Exhibit 10.2

ASSET PURCHASE AGREEMENT

AMONG

SLMTI DS LLC

SL MONTEVIDEO TECHNOLOGY, INC.,

AND

ITT TORQUE SYSTEMS, INC.

DATED MAY 22, 2015

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TABLE OF CONTENTS

 

          Page  

ARTICLE I           Definitions

     1  

ARTICLE II          Purchase and Sale

     9     Section 2.1    Terms of Purchase and Sale      9     Section 2.2   
The Closing      9     Section 2.3    Closing Deliveries      10     Section 2.4
   Assignment and Assumption      10     Section 2.5    Non-Assumption of
Liabilities      11     Section 2.6    Instruments of Conveyance      11    
Section 2.7    Allocation of Purchase Price      11     Section 2.8    Purchase
Price Adjustment      12     Section 2.9    Real Estate Taxes      14  

ARTICLE III         Representations and Warranties of the Seller

     14     Section 3.1    Organization and Qualification of the Seller      14
    Section 3.2    Due Authorization; Authority of Seller; Enforceability     
14     Section 3.3    No Violation      14     Section 3.4    Assets      15    
Section 3.5    Affiliated Businesses      15     Section 3.6    Subsidiaries   
  15     Section 3.7    Financial Statements      15     Section 3.8    Events
Since the Balance Sheet Date      16     Section 3.9    Absence of Undisclosed
Liabilities      17     Section 3.10    Real Property      17     Section 3.11
   Personal Property      20     Section 3.12    Contracts and Commitments     
20     Section 3.13    Suppliers and Customers      21     Section 3.14   
Insurance      22     Section 3.15    Labor Agreements and Actions      22    
Section 3.16    Employee Benefit Plans      23     Section 3.17    Taxes      24
    Section 3.18    Legal Proceedings      25     Section 3.19    Judgments,
Decrees and Orders      25     Section 3.20    Compliance With Laws      25    
Section 3.21    Environmental Matters      26     Section 3.22    Consummation
of this Transaction      27     Section 3.23    Intellectual Property.      27  
  Section 3.24    Employees      29     Section 3.25    Brokers or Finders     
29     Section 3.26    Powers of Attorney      29     Section 3.27    Accounts
Receivable      29     Section 3.28    Accounts Payable      29     Section 3.29
   Product Warranties      30     Section 3.30    Ordinary Course      30  

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TABLE OF CONTENTS

(Continued)

 

              Page  

ARTICLE IV        Representations and Warranties of the Purchaser and Parent

     30    

Section 4.1

   Corporate Organization      30    

Section 4.2

   Due Authorization; Authority of Purchaser and Parent; Enforceability      30
   

Section 4.3

   No Violation      31    

Section 4.4

   Financing      31    

Section 4.5

   Brokers or Finders      31  

ARTICLE V         Covenants

     31    

Section 5.1

   Title Insurance and Survey      31    

Section 5.2

   Seller Mail      32    

Section 5.3

   Collection; Inquiries      32    

Section 5.4

   Business Relations      32    

Section 5.5

   Business Referrals      32    

Section 5.6

   Non-Competition      32    

Section 5.7

   Use of Seller Names and Marks      34    

Section 5.8

   Warranty Obligations      34  

ARTICLE VI        Survival and Indemnification

     34    

Section 6.1

   Survival of Representations and Warranties      34    

Section 6.2

   Indemnification      35    

Section 6.3

   Limitations on Liabilities      36    

Section 6.4

   Indemnification Procedure as to Third Party Claims      37    

Section 6.5

   Other Indemnification Claims      38    

Section 6.6

   Sole Remedy      38  

ARTICLE VII      Employees and Employee Benefits

     38    

Section 7.1

   Employment      38    

Section 7.2

   Compensation and Employee Benefits      38    

Section 7.3

   Healthcare Plans      39    

Section 7.4

   Seller Savings Plan      40    

Section 7.5

   Terminations or Layoffs      40    

Section 7.6

   Vacation; Sick Time      40    

Section 7.7

   Flexible Spending Accounts      40    

Section 7.8

   Disability      40    

Section 7.9

   Assistance      41    

Section 7.10

   No Assumption of Plans      41    

Section 7.11

   Purchaser’s Actions      41    

Section 7.12

   No Third Party Rights      41    

Section 7.13

   M&A Qualified Beneficiaries      41    

Section 7.14

   No Modification      41                    

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TABLE OF CONTENTS

(Continued)

 

              Page                    

ARTICLE VIII      Miscellaneous

     41    

Section 8.1

   Books and Records      41    

Section 8.2

   Further Assurances and Assistance      42    

Section 8.3

   Press Releases and Public Announcements      42    

Section 8.4

   Notices      42    

Section 8.5

   Transaction Expenses      43    

Section 8.6

   Bulk Transfer Laws      44    

Section 8.7

   Miscellaneous Taxes and Expenses      44    

Section 8.8

   Successors and Assigns      44    

Section 8.9

   Governing Law      44    

Section 8.10

   Disputes      44    

Section 8.11

   Entire Agreement; Third Party Rights      44    

Section 8.12

   Amendment; Waiver      44    

Section 8.13

   Effect of Captions      44    

Section 8.14

   Counterparts      45  

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Exhibits and Schedules:

 

Exhibit A

   Assumed Liabilities

Exhibit B

   Excluded Assets

Exhibit C

   Form of Bill of Sale

Exhibit D

   Form of Assignment and Assumption Agreement

Exhibit E

   Form of Transition Services Agreement

Exhibit F

   Form of Deed

Exhibit G

   Allocation of Purchase Price

Exhibit H

   Form of Guaranty

Schedule 1.1

  

Permitted Exceptions

Schedule 1.2

  

Products

Schedule 1.3

  

Purchased Assets

Schedule 1.4

  

Additional Purchased Assets

Schedule 2.4

  

Assigned Contracts

Schedule 2.5

  

Excluded Liabilities

Schedule 2.8(a)

  

Working Capital Calculation Sample

Schedule 3.1

  

Foreign Qualifications of Seller

Schedule 3.3

  

No Violation

Schedule 3.4

  

Assets

Schedule 3.5

  

Affiliated Businesses

Schedule 3.7(a)

  

Financial Statements

Schedule 3.7(b)

  

Allotted Charges and Credits

Schedule 3.8

  

Events Since the Balance Sheet Date

Schedule 3.10(a)

  

Owned Real Property

Schedule 3.10(c)

  

Improvements

Schedule 3.10(d)(vi)

  

Material Plans and Specifications of Owned Real Property

Schedule 3.10(g)

  

Agreements with Real Estate Broker, Agent or Finder

Schedule 3.10(i)

  

Condition of Real Property

Schedule 3.10(m)

  

Owned Real Property Insurance Policy Requirements

Schedule 3.11(c)

  

Inventory Quality

Schedule 3.11(d)

  

Personal Property Leases

Schedule 3.12(a)

  

Contracts and Commitments

Schedule 3.12(c)

  

Consent or Termination of Contracts

Schedule 3.13(a)

  

Suppliers and Customers

Schedule 3.14

  

Insurance

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Schedule 3.15

  

Labor Agreements and Actions

Schedule 3.16(a)

  

Employee Benefit Plans

Schedule 3.16(d)

  

Termination of Benefit Plans

Schedule 3.18

  

Legal Proceedings

Schedule 3.20(b)

  

Compliance with Laws

Schedule 3.20(c)

  

Material Adverse Effect and Permits

Schedule 3.20(d)

  

Governmental Authorization

Schedule 3.20(e)

  

Product Regulatory Requirements

Schedule 3.21(a)

  

Compliance with Environmental Laws

Schedule 3.21(b)

  

Environmental Permits

Schedule 3.21(d)

  

Hazardous Substances

Schedule 3.21(e)

  

Environmental Claims

Schedule 3.21(f)

  

Investigation under Environmental Laws

Schedule 3.23(a)

  

Industrial Property

Schedule 3.23(c)

  

Intellectual Property Contracts

Schedule 3.23(h)

  

Off the Shelf Software

Schedule 3.24(a)

  

Employees

Schedule 3.24(b)

  

Vacation and Sick Hours

Schedule 3.26

  

Powers of Attorney

Schedule 3.27

  

Accounts Receivable

Schedule 4.3

  

Required Consents

Schedule 7.1

  

Offered Employees

Schedule 7.2

  

Severance Policies

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ASSET PURCHASE AGREEMENT

THIS ASSET PURCHASE AGREEMENT (this “Agreement”) is made as of May 22, 2015 by
and among SLMTI DS LLC, a Delaware limited liability company (the “Purchaser”),
SL Montevideo Technology, Inc., a Minnesota corporation and parent of Purchaser
(the “Parent”), and ITT Torque Systems, Inc. an Ohio corporation (the “Seller”).

W I T N E S S E T H:

WHEREAS, the Purchaser and the Parent are affiliated entities;

WHEREAS, the Seller owns the Purchased Assets (as hereinafter defined);

WHEREAS, the parties hereto desire that the Seller sell the Purchased Assets to
the Purchaser, and that the Purchaser purchase the Purchased Assets from the
Seller;

NOW, THEREFORE, the parties hereto agree as follows:

ARTICLE I

DEFINITIONS

Whenever used in this Agreement the following terms shall have the following
respective meanings:

“AAA” has the meaning ascribed thereto in Section 8.10.

“Accounts Payable” means, without duplication, any and all trade and accounts
payable of Seller with respect to the Business.

“Accounts Receivable” means accounts receivable (billed and unbilled) and other
obligations owed to Seller with respect to the Business.

“Acquired Business” has the meaning ascribed thereto in Section 5.6(a).

“Assigned Contracts” has the meaning ascribed thereto in Section 2.4(a).

“Assignment and Assumption Agreement” means the Assignment and Assumption
Agreement in the form attached as Exhibit D hereto.

“Associate” means with respect to any Person any other Person directly or
indirectly controlling, controlled by or under common control with such
specified Person. For purposes of this definition, control means ownership of
more than 50% of the shares or other equity interest having power to elect
directors or persons performing a similar function.

“Assumed Liabilities” means the liabilities of the Seller set forth in
Exhibit A.

“Assumed Warranty Obligations” means all Warranty Obligations other than the
Excluded Warranty Obligations.

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“Balance Sheet Date” has the meaning ascribed thereto in Section 3.7.

“Bill of Sale” means the Bill of Sale in the form attached as Exhibit C hereto.

“Benefit Plans” means plans, contracts, agreements, practices, policies or
arrangements, whether oral or written, providing for any bonuses, deferred
compensation, pension, retirement benefits, excess benefits, profit sharing,
stock bonuses, stock options, stock purchases, life, accident and health
insurance, hospitalization, savings, holiday, vacation, severance pay, sick pay,
sick leave, disability, tuition refund, service awards, company car,
scholarship, relocation, or any other employee or executive benefits, including,
without limitation, any such plan, contract, agreement, practice, policy or
arrangement which is an “employee benefit plan” as defined in Section 3(3) of
ERISA, including any Welfare Plan, any Pension Plan, and any Multiemployer Plan.

“Bonds” means the $2,930,000 original principal amount of Massachusetts
Development Finance Agency Multi-Mode Variable Rate Industrial Revenue Bonds
(Cleveland Motion Controls, Inc. Issue, Series 2001).

“Business” means the Seller’s business of designing and manufacturing engineered
motion control products, including brush servo motors, brushless servo motors,
incremental encoders, and linear actuators.

“Business Day” means any day other than a Saturday, Sunday or any other day on
which commercial banks located in New York City are authorized or required by
Law to be closed for business.

“Claim” has the meaning ascribed thereto in Section 6.5.

“Closing” has the meaning ascribed thereto in Section 2.2.

“Closing Adjustment” has the meaning set forth in Section 2.8(a)(ii).

“Closing Date” has the meaning ascribed thereto in Section 2.2.

“Closing Payment” has the meaning ascribed thereto in Section 2.1(c).

“Closing Working Capital” means (a) the Current Assets of the Business, less
(b) the Current Liabilities of the Business, determined as of the close of
business at 11:59 p.m. on the Business Day immediately preceding the Closing
Date.

“Closing Working Capital Statement” has the meaning set forth in Section 2.8(b).

“COBRA” means the requirements of Part 6 of Subtitle B of Title I of ERISA and
Code Section 4980B.

“Code” has the meaning ascribed thereto in Section 3.16(b).

“Competing Operations” has the meaning ascribed thereto in Section 5.6(a).

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“Contract” means contracts, agreements, purchase orders, plans, leases, licenses
and franchises relating primarily or exclusively to the Business.

“Current Assets” means, as of a given date, the Accounts Receivable and
Inventory on such date.

“Current Liabilities” means, as of a given date, the Accounts Payable on such
date.

“Deed” means the warranty deed in the form of Exhibit F hereto.

“Disability” or “Disabled” means any illness or injury or any other reason that
an Offered Employee has missed work, except for taking vacation or personal
leave time, or working part-time.

“Dispute” has the meaning ascribed thereto in Section 6.6.

“Disputed Amounts” has the meaning set forth in Section 2.8(c)(iii).

“Effective Benefits Time” has the meaning ascribed thereto in Section 7.3(b)(i).

“Environmental Indemnitee” has the meaning ascribed thereto in Section 6.4(a).

“Environmental Laws” means Laws relating to (i) emission, discharge, release or
threatened release of Hazardous Substances, into the environment (including,
without limitation, the air, surface water, ground water, land, natural
resources or subsurface strata) or (ii) the manufacture, processing,
distribution, use, treatment, storage, disposal, transport, or handling of
Hazardous Substances or (iii) the protection of public health, safety or the
environment.

“Environmental Side Letter” means that certain side letter regarding
environmental matters concerning the Owned Real Property and facilities
previously owned or operated by Seller or its predecessors.

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended.

“Excluded Assets” means the assets of Seller set forth in Exhibit B.

“Excluded Liabilities” has the meaning ascribed thereto in Section 2.5.

“Existing Surveys” has the meaning ascribed thereto in Section 3.10(a).

“Existing Title Policies” has the meaning ascribed thereto in Section 3.10(a).

“Excluded Warranty Obligations” means all Warranty Obligations that are (i) in
excess of an aggregate of $35,000 in any 12-month period, and (ii) incurred
during the 18-month period immediately following the Closing.

“Financial Statements” has the meaning ascribed thereto in Section 3.7.

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“Fundamental Representations” means, with respect to Seller, the representations
and warranties set forth in Sections 3.1 (Organization and Qualification of
Seller), 3.2 (Due Authorization; Authority of Seller; Enforceability), 3.4(a)
(Assets) and 3.25 (Brokers or Finders) and with respect to Purchaser, the
representations and warranties set forth in Sections 4.1 (Corporate
Authorization), 4.2 (Due Authorization; Authority of Purchaser and Parent;
Enforceability), and 4.5 (Brokers or Finders).

“GAAP” means generally accepted accounting principles in the United States in
effect from time to time as applied in a consistent manner by the Seller.

“Governmental Authority” means any (a) nation, region, state, county, city,
town, village, district or other jurisdiction, (b) federal, state, local,
municipal, foreign or other government, (c) governmental or quasi–governmental
authority of any nature (including any governmental agency, branch, department
or other entity and any court or other tribunal), (d) multinational organization
exercising judicial, legislative or regulatory power or (e) body exercising, or
entitled to exercise, any administrative, executive, judicial, legislative,
police, regulatory or taxing authority or power of any nature of any federal,
state, local, municipal, foreign or other government.

“Guarantor” means ITT.

“Guaranty” means the guaranty attached hereto as Exhibit H.

“Hazardous Substances” means solid waste and pollutants, contaminants, or
hazardous or toxic substances, materials or wastes including, but not limited
to, (a) those substances defined as hazardous substances or pollutants or
contaminants under Section 101 of the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended from time to time (42 U.S.C.
Section 9601); (b) those substances defined as hazardous wastes under
Section 1004 of the Resource Conservation and Recovery Act, as amended from time
to time (42 U.S.C. Section 6903); (c) those substances regulated under the Toxic
Substances Control Act, as amended from time to time (15 U.S.C. Sections 2601 et
seq.); (d) petroleum, including crude oil or any fraction thereof; and (e) those
substances regulated under any applicable Law due to their known or suspected
ability to cause harm to human health, safety or the environment.

“Improvements” means buildings and other improvements on the Owned Real
Property.

“Indemnitee” has the meaning ascribed thereto in Section 6.5.

“Indemnitor” has the meaning ascribed thereto in Section 6.5.

“Independent Accountant” has the meaning ascribed thereto in
Section 2.8(b)(iii).

“Industrial Property” means patents, copyright registrations, mask work
registrations, trademark and service mark registrations, domain names, social
media accounts and applications for any of the foregoing, relating or used
primarily or exclusively in the Business.

“Industrial Property Assignments” means the Trademark and Copyright Assignment
and the Domain Name, Social Media Account Assignment related to the Industrial
Property.

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“Intellectual Property” means Industrial Property and inventions, invention
studies (whether patentable or unpatentable), unregistered: designs, copyrights,
mask works, trademarks, service marks, trade dress, trade names, secret
formulae, trade secrets, secret processes, computer programs embedded in
Products, confidential information, license agreements and know-how relating or
used primarily or exclusively in the Business.

“Interim Financial Statements” has the meaning ascribed thereto in
Section 3.7(a).

“Inventory” to the extent owned by Seller, all estimated work-in-progress
including capitalized variances, raw materials, and finished goods used in the
Business.

“ITT” means ITT Corporation, an Indiana corporation and the ultimate parent of
the Seller.

“Laws” means laws (including, without limitation, common law), ordinances,
codes, standards, rulings, orders, directives, decrees, regulations or
requirements of any Governmental Authority.

“Liens” has the meaning ascribed thereto in Section 3.4.

“Licensed Intellectual Property” means all Intellectual Property that is
licensed to Seller by a third party and is used or held for use in the conduct
of the Business.

“Losses” has the meaning ascribed thereto in Section 6.2.

“Major Customer” has the meaning ascribed thereto in Section 3.13(a)(iv).

“Major Supplier” has the meaning ascribed thereto in Section 3.13(a)(i).

“Material Adverse Effect” means any change, event, occurrence, effect,
development or circumstance that, individually or in the aggregate with all
other changes, events, occurrences, effects, developments or circumstances, is
or would reasonably be expected to be likely to be materially adverse to:
(a) the Business, assets, liabilities, financial condition or results of
operations of the Business, taken as a whole; or (b) the ability of Seller to
consummate the transactions contemplated by this Agreement; provided, however,
that any change, event, occurrence, effect, development or circumstance arising
out of or in connection with (i) changes in global, national or regional
political conditions or general business, economic or market conditions,
including changes in prevailing interest rates, currency exchange rates and
price levels or trading volumes in the United States or foreign securities
markets; (ii) changes in the credit, financial, banking, securities or
commodities markets (including any disruption thereof and any decline in the
price of any security, commodity or any market index, any downgrades in the
credit markets, or adverse credit events resulting in deterioration in the
credit markets generally), (iii) conditions generally affecting the industry in
which the Seller operates, (iv) earthquakes, hurricanes, floods or other natural
disasters, (v) hostilities, acts of war, sabotage or terrorism or military
actions or any escalation or material worsening of any such hostilities, acts of
war, sabotage or terrorism or military actions existing or underway as of the
date hereof, (vi) changes in any Laws or accounting rules, (vii) any adverse
change in or effect on the Business that is cured prior to Closing, or
(viii) the public announcement of this Agreement or the

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transactions contemplated hereby, any action taken by a party hereto in
accordance with this Agreement or the consummation of the transactions
contemplated hereby, shall not be taken into account in determining whether a
“Material Adverse Effect” has occurred, except, with respect to clauses
(i) through (vi) of this definition, to the extent such change, event,
occurrence, effect, development or circumstance materially disproportionately
impacts the Seller as compared to other Persons engaged in the industries in
which the Seller conducts the Business.

“Mortgage” means a mortgage, deed of trust, deed to secure debt or other
security instrument which is a lien on or title interest in real property or
leased real property, including any notes or bonds secured thereby.

“Multiemployer Plan” means multiemployer plan” as defined in Section 3(37) of
ERISA.

“Offered Employees” has the meaning ascribed thereto in Section 7.1.

“Owned Real Property” has the meaning ascribed thereto in Section 3.10(a).

“Parent” has the meaning ascribed thereto in the preamble of this Agreement.

“Pension Plan” means “employee pension benefit plan” as defined in Section 3(2)
of ERISA.

“Permits” means permits, licenses, franchises, certifications, approvals,
consents waivers, and other authorizations from public authorities.

“Permitted Exceptions” means: (a) liens for any current real estate or ad
valorem taxes or assessments not yet delinquent or being contested in good faith
by appropriate proceeding, as disclosed on Schedule 1.1 hereto; and (b) inchoate
mechanic’s, materialmen’s, laborer’s, and carrier’s liens and other similar
inchoate liens arising by operation of law or statute in the ordinary course of
the business of the Business for obligations which are not delinquent and which
will be paid or discharged in the ordinary course of such business.

“Person” means an individual, partnership, corporation, business trust, limited
liability company, limited liability partnership, joint venture or other entity,
or a government entity.

“Post-Closing Adjustment” has the meaning set forth in Section 2.8(b)(ii).

“Products” means the products of the Business, including those listed on
Schedule 1.2 hereto.

“Purchase Price” has the meaning ascribed thereto in Section 2.1(b).

“Purchased Assets” means all the assets of the Seller used or held for use
primarily or exclusively in the Business, other than Excluded Assets, including
but not limited to the following:

(a) the Owned Real Property;

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(b) the Improvements;

(c) fixed assets, machinery and equipment, including the vehicles listed on
Schedule 1.3 hereto, together with all assignable warranties by the
manufacturers or sellers of those items, and all maintenance records, brochures,
catalogues and other documents and software relates to those items or to the
installation or function of those items, which Seller has in its possession or
that are in the possession of Seller’s vendors or service providers;

(d) furniture and fixtures;

(e) Inventory;

(f) Accounts Receivable;

(g) prepaid expenses;

(h) the Permits indicated as being transferable to Purchaser and listed on
Schedule 3.20(c) and Schedule 3.21(b) hereto;

(i) all Assigned Contracts;

(j) all customer lists and business records;

(k) all Intellectual Property;

(l) goodwill associated with the Business;

(m) supplies;

(n) intangible property rights, including, but not limited to confidentiality,
non-competition, non-solicitation and similar obligations related to the
Business and all causes of action, claims and rights to recovery or offset of
any kind or character arising from or relating to events occurring after the
Closing Date concerning the Business, the Purchased Assets or the Assumed
Liabilities; and

(o) the other assets listed on Schedule 1.4 hereto.

“Purchaser” has the meaning ascribed thereto preamble of this Agreement.

“Purchaser Indemnitee” has the meaning ascribed thereto in Section 6.2.

“Purchaser’s Welfare Benefits Program” has the meaning ascribed thereto in
Section 7.3(b)(i).

“Qualified Benefit Plan” has the meaning ascribed thereto in Section 3.16(b).

“Real Property” means real property and interests in real property.

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“Required Consents” means the consents, filings and notices set forth on
Schedule 3.12(c), Schedule 3.20(d) and
Schedule 3.21(b).

“Resolution Period” has the meaning ascribed thereto in Section 2.8(b)(ii).

“Restrictions” has the meaning ascribed thereto in Section 3.10(a).

“Restricted Parties” has the meaning ascribed thereto in Section 5.6(a).

“Restricted Period” has the meaning ascribed thereto in Section 5.6(a).

“Review Period” has the meaning ascribed thereto in Section 2.8(b)(i).

“Salaried Employees” has the meaning ascribed thereto in Section 3.24(a).

“Seller” has the meaning ascribed thereto on page 1 of this Agreement.

“Seller’s Knowledge” or “Knowledge of Seller” means the Seller’s knowledge,
including the knowledge of James Farley, Richard Duray, and Arvind Ramani, in
each case after due inquiry.

“Seller Indemnitee” has the meaning ascribed thereto in Section 6.2.

“Seller Savings Plan” has the meaning ascribed thereto in Section 7.4.

“Seller’s Welfare Benefits Program” has the meaning ascribed thereto in
Section 7.3(b)(i).

“Statement of Objections” has the meaning ascribed thereto in
Section 2.8(b)(ii).

“Survival Periods” has the meaning ascribed thereto in Section 6.1.

“Target Working Capital” means $1,556,000.

“Tax” means any income, gross receipts, sales, use, real estate, ad valorem,
transfer, franchise, withholding, payroll, employment, excise, severance,
occupation, premium or property tax or other like assessment or charge of any
kind whatsoever, together with any interest, penalty, addition to tax or other
additional amount imposed by any taxing authority.

“Tax Return” means any Tax return, report or form.

“Threshold” has the meaning ascribed thereto in Section 6.3(a).

“Title Insurer” means a reputable title company authorized to do business in the
jurisdiction in which the real property in question is located.

“Transaction Documents” means this Agreement, the Bill of Sale, the Assignment
and Assumption Agreement, the Guaranty, Industrial Property Assignments, the
Transition Services Agreement, the Deed, and the Environmental Side Letter.

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“Transition Services Agreement” means the Transition Services Agreement in the
form of Exhibit E hereto.

“Transitioned Employees” has the meaning ascribed thereto in Section 7.1.

“Undisputed Amounts” has the meaning set forth in Section 2.8(c)(iii).

“WARN” has the meaning ascribed thereto in Section 3.24(c).

“Warranty Obligations” means all written warranty obligations with respect to
products manufactured and sold by the Seller prior to the Closing Date pursuant
to the terms of the warranties issued by the Seller.

“Welfare Plan” means “employee welfare benefit plan” as defined in Section 3(l)
of ERISA.

ARTICLE II

PURCHASE AND SALE

Section 2.1 Terms of Purchase and Sale.

Subject to the terms and conditions of this Agreement:

(a) The Seller shall sell, assign and transfer the Purchased Assets and Assumed
Liabilities to the Purchaser and the Purchaser shall purchase the Purchased
Assets and assume the Assumed Liabilities from the Seller.

(b) In consideration for the Purchased Assets, the Purchaser shall pay to the
Seller an aggregate purchase price (the “Purchase Price”) equal to Nine Million
Dollars ($9,000,000.00), and assume the Assumed Liabilities. The Purchase Price
shall be subject to increase or decrease by the Post-Closing Adjustment, as set
forth in Section 2.8.

(c) At Closing, the Purchase Price ($9,000,000.00) shall be paid by wire
transfer of immediately available funds to an account designated in writing by
Seller to Purchaser no later than two Business Days prior to the Closing Date
(the “Closing Payment”).

Section 2.2 The Closing. Consummation of the sale and purchase of the Business
(the “Closing”) shall take place concurrently with the execution and delivery of
this Agreement at the offices of Day Pitney LLP, One International Place,
Boston, Massachusetts, or via the electronic exchange of documents and
signatures. The date of Closing is herein called the “Closing Date.” The parties
hereto acknowledge and agree that all proceedings at the Closing shall be deemed
to be taken and all documents to be executed and delivered by all parties at the
Closing shall be deemed to have been taken and executed simultaneously, and no
proceedings shall be deemed taken nor any documents executed or delivered until
all have been taken, executed or delivered. The Closing shall be deemed
effective as of 11:59 p.m., Massachusetts time on the Closing Date.

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Section 2.3 Closing Deliveries. At the Closing:

 

  (a) The Seller shall deliver to the Purchaser the following:

 

  (i) possession of the Purchased Assets;

 

  (ii) the Bill of Sale and Assignment and Assumption Agreement, each duly
executed by the Seller;

 

  (iii) the Transition Services Agreement, each duly executed by the Seller;

 

  (iv) the Deed;

 

  (v) the Industrial Property Assignments in a form satisfactory to Purchaser,
each duly executed by the Seller;

 

  (vi) a non-foreign person affidavit duly executed by the Seller;

 

  (vii) evidence that the Required Consents have been obtained or filed, as
applicable;

 

  (viii) the Guaranty, duly executed by the Guarantor; and

 

  (ix) the Environmental Side Letter, duly executed by Seller and the Guarantor.

 

  (b) The Purchaser and the Parent shall deliver to the Seller the following:

 

  (i) the Purchase Price;

 

  (ii) the Assignment and Assumption Agreement duly executed by the Purchaser;

 

  (iii) the Transition Services Agreement duly executed by the Purchaser; and

 

  (iv) the Industrial Property Assignments duly executed by the Purchaser.

Section 2.4 Assignment and Assumption.

(a) The Contracts listed on Schedule 2.4 are included in the Purchased Assets
and shall be assigned to the Purchaser at the Closing (the “Assigned
Contracts”). Nothing in this Agreement shall be construed as an attempt to
assign any Contract which by its terms or by law is not assignable without the
consent of the other party or parties thereto, unless such consent shall have
been given. The Seller agrees to use commercially reasonable efforts to obtain
the consent of any such other party or parties in each case where such consent
is required and is requested by the Purchaser. If any Required Consent is not
obtained, the Seller will cooperate

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with the Purchaser in any reasonable arrangement designed to provide for the
Purchaser the benefits under any such Assigned Contracts or otherwise provide
Purchaser with the economic and, to the extent permitted under applicable Law,
operational equivalent of the transfer of such Assigned Contract as of the
Closing. All cure costs related to assignment of Assigned Contract shall be paid
by the Seller.

(b) To the extent permitted under applicable Law, Seller shall, at Purchaser’s
expense, hold in trust for and pay to Purchaser promptly upon receipt thereof,
such Purchased Asset and all income, proceeds and other monies received by
Seller to the extent related to such Purchased Asset in connection with the
arrangements under this Section 2.04. Seller shall be permitted to set off
against such amounts all direct costs associated with the retention and
maintenance of such Purchased Assets.

(c) The Purchaser hereby assumes and agrees to pay, perform and discharge when
due the Assumed Liabilities.

Section 2.5 Non-Assumption of Liabilities. The Purchaser does not assume any
liabilities of the Seller except the Assumed Liabilities, all such liabilities
not assumed, the “Excluded Liabilities”. For purposes of clarification and not
limitation, Schedule 2.5 sets forth liabilities specifically deemed “Excluded
Liabilities” which Excluded Liabilities are in addition to the Excluded
Liabilities set forth in the first sentence of this Section 2.5.

Section 2.6 Instruments of Conveyance. In order to effectuate the sale,
conveyance, transfers and assignments contemplated by Section 2.1 hereof, the
Seller will execute and deliver at the Closing, or as reasonably soon thereafter
as is customary in Massachusetts, all such deeds, bills of sale and other
documents or instruments of conveyance, transfer or assignment as shall be
necessary or appropriate to vest in or to confirm in the Purchaser full and
complete title to all of the Purchased Assets free and clear of any Liens (other
than Liens securing Assumed Liabilities, Liens securing the Bonds, and Permitted
Exceptions), all of which documents shall be in form and substance reasonably
satisfactory to counsel for the Purchaser and the Seller. Subsequent to the
Closing, the Seller will execute and deliver from time to time, at the request
of the Purchaser, all such further instruments of conveyance, transfer,
assignment and further assurance as may reasonably be required in order to vest
in and confirm to the Purchaser full and complete title to and the right to use
and enjoy the Purchased Assets. Without limiting the generality of the
foregoing, with respect to the Owned Real Property to be conveyed to the
Purchaser pursuant hereto which has previously been recorded, such conveyance
shall be in recordable form.

Section 2.7 Allocation of Purchase Price. The Purchase Price will be allocated
among the Purchased Assets, as set forth on Exhibit G, in accordance with
Section 1060 of the Code. For the purposes of all Taxes and Tax returns, the
parties agree to report the transactions contemplated in this Agreement in a
manner consistent with Exhibit G and none of them will take any position
inconsistent therewith in any Tax return, in any refund claim, in any
litigation, or otherwise without the consent of the other party except as
required by a final “determination” within the meaning of Section 1313 of the
Code. The Seller shall prepare the first draft of Internal Revenue Service Form
8594, which shall be sent to Purchaser at least 90 days prior to the due date,
including extensions, for filing the federal income tax return for the Seller or
the

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Purchaser, whichever files its return earlier, for the taxable year in which the
Closing takes place. With 30 days following the receipt of such Form 8594,
Purchaser shall propose any changes to such Form 8594 or shall indicate its
concurrence therewith, which concurrence shall not be unreasonably withheld.

Section 2.8 Purchase Price Adjustment.

(a) Post-Closing Adjustment.

(i) Within sixty (60) days after the Closing Date, Purchaser shall prepare and
deliver to Seller a statement setting forth its calculation of Closing Working
Capital, which statement shall contain an unaudited balance sheet of the
Business as of the Closing Date (without giving effect to the transactions
contemplated herein) (the “Closing Working Capital Statement”). The line items
set forth in the Closing Working Capital Statement shall be prepared in good
faith in accordance with the sample calculation set forth on Schedule 2.8(a).

(ii) The post-closing adjustment shall be an amount equal to the Closing Working
Capital minus the Target Working Capital (the “Post-Closing Adjustment”). If the
Post-Closing Adjustment is a positive number, Purchaser shall pay to Seller an
amount equal to the Post-Closing Adjustment. If the Post-Closing Adjustment is a
negative number, Seller shall pay to Purchaser an amount equal to the
Post-Closing Adjustment.

(b) Examination and Review.

(i) Examination. After receipt of the Closing Working Capital Statement, Seller
shall have sixty (60) days (the “Review Period”) to review the Closing Working
Capital Statement. During the Review Period, Seller and Seller’s Accountants
shall have reasonable access to the books and records of Purchaser as relates to
the Closing Working Capital; the personnel of, and work papers prepared by,
Purchaser and/or Purchaser’s Accountants to the extent that they relate to the
Closing Working Capital Statement, and to such historical financial information
(to the extent in Purchaser’s possession) relating to the Closing Working
Capital Statement as Seller may reasonably request for the purpose of reviewing
the Closing Working Capital Statement and to prepare a Statement of Objections
(defined below).

(ii) Objection. On or prior to the last day of the Review Period, Seller may
object to the Closing Working Capital Statement by delivering to Purchaser a
written statement setting forth Seller’s objections in reasonable detail,
indicating each disputed item or amount and the basis for Seller’s disagreement
therewith (the “Statement of Objections”). If Seller fails to deliver the
Statement of Objections before the expiration of the Review Period, the Closing
Working Capital Statement and the Post-Closing Adjustment, as the case may be,
reflected in the Closing Working Capital Statement shall be deemed to have been
accepted by Seller. If Seller delivers the Statement of Objections before the
expiration of the Review Period, Purchaser and Seller shall negotiate in good
faith to resolve such objections within thirty (30) days after the delivery of
the Statement of Objections (the “Resolution Period”), and, if the same are so
resolved within the Resolution Period, the Post-Closing Adjustment and the
Closing Working Capital Statement with such changes as may have been previously
agreed in writing by Purchaser and Seller shall be final and binding.

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(i) Resolution of Disputes. If the Seller and the Purchaser fail to reach an
agreement with respect to all of the matters set forth in the Statement of
Objections before expiration of the Resolution Period, then any amounts
remaining in dispute (“Disputed Amounts” and any amounts not so disputed, the
“Undisputed Amounts”) shall be submitted for resolution to an impartial
nationally recognized firm of independent certified public accountants, other
than Seller’s Accountants, Seller’s Associate’s Accountants or Purchaser’s
Accountants which the Purchaser and the Seller shall appoint by mutual agreement
(the “Independent Accountant”), who, acting as experts and not arbitrators,
shall resolve the Disputed Amounts only and make any adjustments to the Closing
Working Capital Statement and the Post-Closing Adjustment. The Parties agree
that all adjustments shall be made without regard to materiality. The
Independent Accountant shall only decide the specific items under dispute by the
parties and its decision for each Disputed Amount must be within the range of
values assigned to each such item in the Closing Working Capital Statement and
the Statement of Objections, respectively.

(iii) Fees of the Independent Accountant. The fees and expenses of the
Independent Accountant shall be paid by Seller, on the one hand, and by
Purchaser, on the other hand, based upon the percentage that the amount actually
contested but not awarded to Seller or Purchaser, respectively, bears to the
aggregate amount actually contested by Seller and Purchaser.

(iv) Determination by Independent Accountant. The Independent Accountant shall
make a determination as soon as practicable within thirty (30) days (or such
other time as the parties hereto shall agree in writing) after its engagement,
and their resolution of the Disputed Amounts and their adjustments to the
Closing Working Capital Statement and/or the Post-Closing Adjustment shall be
conclusive and binding upon the parties hereto.

(v) Payments of Post-Closing Adjustment. Except as otherwise provided herein,
any payment of the Post-Closing Adjustment shall (A) be due (x) within ten
(10) Business Days of acceptance of the applicable Closing Working Capital
Statement or (y) if there are Disputed Amounts, then within ten (10) Business
Days of the resolution described in clause (iii) above; and (B) be paid by wire
transfer of immediately available funds to such account(s) as is directed by
Purchaser or Seller, as the case may be. Any Post-Closing Adjustment not paid
within such time period shall bear interest from the due date at a rate per
annum equal to the lowest applicable federal rate promulgated by the Internal
Revenue Service for short-term loans as of the Closing Date. Such interest shall
be calculated daily on the basis of a 365 day year and the actual number of days
elapsed, without compounding.

(c) Adjustments for Tax Purposes. Any payments made pursuant to this Section 2.8
shall be treated as an adjustment to the Purchase Price by the parties for Tax
purposes, unless otherwise required by Law.

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Section 2.9 Real Estate Taxes. All real estate Taxes levied against the Owned
Real Property shall be prorated as of the date hereof between the Purchaser and
the Seller, with the Seller receiving an adjustment payment for those real
estate Taxes paid in advance that are applicable to periods after the date
hereof and Purchaser receiving an adjustment payment for those real estate Taxes
not paid which are applicable to the periods prior to the date hereof. Such
adjustment shall be paid by the applicable party promptly following receipt of
evidence reasonably acceptable to such party of such payment of Taxes by the
other party.

ARTICLE III

REPRESENTATIONS AND WARRANTIES OF THE SELLER

The Seller, represents and warrants to the Purchaser and the Parent that:

Section 3.1 Organization and Qualification of the Seller. The Seller is duly
organized, validly existing and in good standing under the laws of the State of
Ohio and has full power to own the Purchased Assets owned by it and to carry on
the Business as it is now being conducted, and is qualified to do business as a
foreign corporation in the jurisdictions identified with respect to it in
Schedule 3.1, which are the only jurisdictions in which its ownership or conduct
of the Business requires it to be so qualified. Seller is a wholly owned
indirect subsidiary of Guarantor.

Section 3.2 Due Authorization; Authority of Seller; Enforceability.

(a) The Seller has all requisite power and authority to make, execute, deliver
and perform this Agreement and the Transaction Documents to which it is a party
and to consummate the transactions contemplated hereby and thereby.

(b) The execution and delivery by Seller of this Agreement and the other
Transaction Documents to which it is a party has been, and the consummation by
Seller and ITT of the transactions contemplated hereby and thereby have been,
duly authorized by all necessary corporate action on the part of Seller, and no
other corporate proceeding is necessary for the execution and delivery of this
Agreement or such other agreements by Seller or the performance by Seller of its
obligations hereunder or thereunder.

(c) This Agreement and each of the Transaction Documents to which the Seller is
a party constitutes the legal, valid and binding obligation of each enforceable
against each of them in accordance with their respective terms, except as
enforcement of such terms may be limited by bankruptcy, insolvency,
reorganization, moratorium-or similar laws affecting the enforcement of
creditors’ rights generally and by the availability of equitable remedies and
defenses.

Section 3.3 No Violation. Except as set forth in Schedule 3.3, the execution and
delivery of this Agreement and the Transaction Documents to which the Seller is
a party and the consummation of the transactions contemplated hereby and thereby
will not (i) violate or conflict with any provision of the governing documents
of Seller; (ii) violate or conflict with any provision of, or result in the
termination of, or the acceleration of (or entitle any party to exercise a right
to terminate or accelerate) any obligation under any mortgage, note, lien,
Contract, lease, franchise, license, Permit, agreement, plan, instrument, order,
arbitration award, judgment or

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decree to which the Seller is a party or by which Seller is bound, or require
the consent of any party thereto; (iii) violate or conflict with any other
material contractual or statutory restriction of any kind or character to which
Seller, the Business or the Purchased Assets is subject; or (iv) violate in any
material respect any Law or any decree or judgment of any court or other
Governmental Authority applicable to Seller, the Business, or any of the
Purchased Assets. Except for the Required Consents, Seller is not required to
obtain any consent from any Person or Governmental Authority in connection with
the execution and delivery of this Agreement or the consummation of the
transactions contemplated hereby.

Section 3.4 Assets. Except as set forth on Schedule 3.4, the Purchased Assets
constitute all of the assets of the Seller used in the operation of the Business
as it is presently operated by Seller, and are adequate and suitable in all
material respects for the continued operation of the Business as conducted on
the date hereof. On consummation of the transactions contemplated by this
Agreement in accordance with the terms thereof, the Seller will transfer to the
Purchaser good and valid title to the Purchased Assets free and clear of any
options, rights of first refusal, liens, claims, charges or other encumbrances
(collectively “Liens”) other than any Liens securing Assumed Liabilities, Liens
securing the Bonds, and Permitted Exceptions.

Section 3.5 Affiliated Businesses. Set forth in Schedule 3.5 is a complete and
accurate list of all Associates of the Seller, which are conducting, or during
the past three years conducted, business (paid or unpaid) with the Seller in
respect of the Business as a supplier, customer or otherwise. Schedule 3.5
specifies: (a) the business engaged in during such period by each such Person,
and (b) the nature and volume of the business conducted by Person with the
Seller in respect of the Business and the period during which it has been
conducted. Except as set forth on Schedule 3.5: (i) no Associate of Seller
provides or causes to be provided any assets, services or facilities to Seller
in relation to the Business, (ii) Seller does not provide nor cause to be
provided any assets, services or facilities to its Associates in relation to the
Business, (iii) Seller does not beneficially own, directly or indirectly, any
investment assets issued by its Associates in relation to the Business, and
(iv) Seller has not entered into any agreement, understanding or arrangement
with its Associates in relation to the Business. As of the Closing Date, there
is no indebtedness, Accounts Receivable or Accounts Payable between Seller, on
the one hand, and its Associates, on the other hand, that are included in the
Purchased Assets or the Assumed Liabilities or reflected in the Working Capital
calculation.

Section 3.6 Subsidiaries. The Seller does not own in respect of the Business any
shares of any corporation or control, directly or indirectly, any interest in
any corporation, partnership, trust, joint venture or other legal entity.

Section 3.7 Financial Statements.

(a) Schedule 3.7(a) includes true and correct copies of (i) the unaudited
balance sheet of the Seller as of the fiscal year ended December 31, 2014 and
the related unaudited statement of income (loss) for such fiscal year (the “2014
Financial Statements”) and (ii) the unaudited balance sheet of the Seller as of
March 31, 2015 (the “Balance Sheet Date”) and the related unaudited statement of
income (loss) for the three (3) month period ending on the Balance Sheet Date
(the “Interim Financial Statements”). The 2014 Financial Statements and the
Interim Financial Statements are collectively referred to herein as the
“Financial Statements.”

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The Financial Statements present fairly in all material respects the financial
condition and results of operations of the Business as of such dates in
accordance with GAAP; provided, that certain liabilities related to employees of
the Seller, Taxes of the Seller and certain intercompany costs not allocated to
the Seller are not reflected on the Financial Statements as would otherwise be
required by GAAP; provided further, that the Financial Statements do not contain
the footnotes required by GAAP and the Interim Financial Statements are subject
to year-end adjustments consistent with past practice.

(b) All of the Financial Statements are qualified by the fact that the Business
has not operated as a separate “stand alone” entity. As a result, the Business
received certain allocated charges and credits, which charges and credits for
the fiscal year ended December 31, 2014, and the year-to-date period ended on
the Balance Sheet Date are set forth on Schedule 3.7(b). Such charges and
credits do not necessarily reflect the amounts which would have resulted from
arms-length transactions or which the Business would incur on a stand-alone
basis.

Section 3.8 Events Since the Balance Sheet Date. Except as disclosed in Schedule
3.8, since the Balance Sheet Date, there has not been:

(a) any material adverse change in the results of operations, assets,
liabilities or financial condition of the Business;

(b) any damage, destruction or loss (whether or not covered by insurance)
materially and adversely affecting the assets or operations of the Business;

(c) any increase in compensation, bonus or other benefits payable or to become
payable by the Seller in respect of the Business to any directors, officers,
employees or agents of the Seller other than normal increases granted in the
ordinary course of business; or

(d) any disposition by the Seller of any Inventory or personal property of the
Business, except such Inventory or personal property as has been disposed of in
the ordinary course of business;

(e) material change in any method of accounting or accounting practice of
Seller, except as required by GAAP or as disclosed in the notes to the Financial
Statements;

(f) material change in Seller’s cash management practices and its policies,
practices and procedures with respect to collection of Accounts Receivable,
establishment of reserves for uncollectible Accounts Receivable, accrual of
Accounts Receivable, inventory control, prepayment of expenses, payment of trade
accounts payable, accrual of other expenses, deferral of revenue and acceptance
of customer deposits;

(g) cancellation of any debts or claims or amendment, termination or waiver of
any rights constituting Purchased Assets;

(h) transfer, assignment or grant of any license or sublicense of any material
rights under or with respect to any Intellectual Property;

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(i) acceleration, termination, material modification to or cancellation of any
Assigned Contract or Permit;

(j) any material capital expenditures which would constitute an Assumed
Liability;

(k) adoption of any plan of merger, consolidation, reorganization, liquidation
or dissolution or filing of a petition in bankruptcy under any provisions of
federal or state bankruptcy Law or consent to the filing of any bankruptcy
petition against it under any similar Law;

(l) purchase, lease or other acquisition of the right to own, use or lease any
property or assets in connection with the Business for an amount in excess of
$20,000, individually (in the case of a lease, per annum) or $50,000 in the
aggregate (in the case of a lease, for the entire term of the lease, not
including any option term), except for purchases of inventory or supplies or
replacement of equipment in the ordinary course of business; or

(m) any Contract or agreement to do any of the foregoing, or any action or
omission that would result in any of the foregoing.

Section 3.9 Absence of Undisclosed Liabilities. There are no liabilities of the
Seller in respect of the Business, whether or not accrued and whether or not
determined or determinable, other than:

(a) liabilities disclosed or fully provided for in the Balance Sheet;

(b) liabilities incurred in the ordinary course of business since the Balance
Sheet Date, none of which has been materially adverse to the assets, financial
condition or results of operations of the Business;

(c) liabilities disclosed in the Schedules to this Agreement; and

(d) liabilities under Contracts not required to be disclosed in the Schedules to
this Agreement.

Section 3.10 Real Property.

(a) Schedule 3.10(a) describes all of the Real Property included in the
Purchased Assets (“Owned Real Property”) and all prior title insurance policies
that insure the Seller’s interests in and to such Owned Real Property. The
Seller has delivered or made available to Purchaser true, correct and complete
copies of all instruments evidencing the Restrictions (hereinafter defined)
affecting the Owned Real Property, title reports, title polices (“Existing Title
Policies”) and surveys (“Existing Surveys”) if any, for the Owned Real Property
in the Seller’s possession or control. No claim has been made by Seller under
any of the Existing Title Policies or Existing Surveys. Except for Permitted
Exceptions and except as disclosed in Schedule 3.10(a), the Seller, to its
Knowledge, has good, marketable and insurable title to all such Owned Real
Property, free and clear of all leases, occupancy agreements, occupancy
arrangements, licenses, covenants, conditions, restrictions, reservations,
reversions,

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licenses, easements, mortgages and other security interests, liens, claims,
charges, options, rights of purchase and other encumbrances (each a
“Restriction,” collectively “Restrictions”). Except as disclosed in Schedule
3.10(a), the Seller is not a party to any contract or option to sell, assign or
otherwise dispose of any Owned Real Property, or to grant or create any
Restriction on or affecting the Owned Real Property, and in respect of the
Business, is not a party to any contract or option to purchase or otherwise
acquire any interest in real property or to create a Restriction affecting the
Owned Real Property and since the Balance Sheet Date, the Seller has not sold,
assigned, granted or created any Restriction on or affecting the Owned Real
Property, and in respect of the Business, has not purchased, sold, assigned or
otherwise disposed of the Owned Real Property or otherwise acquired or disposed
of any interest in Real Property. There are no parties in possession of the
Owned Real Property other than Seller.

(b) The Seller does not lease any Real Property in respect of the Business.

(c) The Improvements are listed on Schedule 3.10(c) hereto. To Seller’s
Knowledge, the Improvements and operations of the Business do not encroach on
the property of others. All Improvements, occupancy and use of the Improvements,
occupancy and use of the Owned Real Property and all such operations, to
Seller’s Knowledge, conform in all material respects with all applicable zoning,
building, fire and safety Laws, and any other applicable Laws relating to the
use and operation of the Owned Real Property and the Business, and the Seller
has not received notice of noncompliance with any such Laws. All permits,
including but not limited to permanent certificates of occupancy, required for
the use and occupancy of the Improvements and Owned Real Property have been
obtained and are valid and in effect, and true, correct and complete copies
thereof have been delivered or made available to Purchaser. To Seller’s
Knowledge, none of the Improvements or uses being made of the Owned Real
Property constitute a legal non-conforming use or otherwise require any special
dispensation, variance or special permit under any Laws.

(d) With respect to the Owned Real Property:

(i) To Seller’s Knowledge, the Seller has legal and practical access to the
roads and utilities needed to substantially operate the Business on the Owned
Real Property; the Seller has not received and to Seller’s Knowledge there do
not exist any adverse claims to such access that would materially adversely
affect the use currently being made of such access by the Seller.

(ii) To Seller’s Knowledge, no material violation of any Restriction affecting
the Owned Real Property or the use or occupancy of the Owned Real Property
exists, and no notice of any such violation has been received from any person
entitled to enforce the same.

(iii) To Seller’s Knowledge, there are no encroachments onto the Owned Real
Property of any improvements on any adjoining property.

(iv) Public and private utilities servicing the Owned Real Property have, to
Seller’s Knowledge, adequate capacity to meet the utility requirements for the
current use of such Owned Real Property.

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(v) To Seller’s Knowledge, the Owned Real Property is assessed separately from
all other adjacent property for purposes of real estate taxes. No action seeking
a reduction in real estate taxes imposed upon the Owned Real Property or the
assessed valuation thereof (or any portion thereof) (1) has been settled during
the period in which the Owned Real Property has been owned, by the Seller or
(2) is currently pending.

(vi) Set forth Schedule 3.10(d)(vi), if any, is a true and correct list of all
material plans and specifications relating to the Owned Real Property in the
possession or control of the Seller. True, correct and complete copies of such
material plans and specifications in the possession or control of the Seller
have been furnished or made available to Purchaser.

(e) To Seller’s Knowledge:

(i) there is not any proposed public improvement which may result in an
assessment upon the Owned Real Property, or any proposed federal, state or local
statute, ordinance, order, requirement, law or regulation (including, but not
limited to, zoning changes) which may adversely affect the current or planned
use of the Owned Real Property; and

(ii) there is no existing or proposed plan to modify or realign any street or
highway that would adversely affect the current or planned use of the Owned Real
Property nor is there any existing or proposed eminent domain proceeding that
would result in the taking of all or any part of the Owned Real Property.

(f) No Real Property owned or controlled directly or indirectly by the Seller
(other than the Owned Real Property) or any Associate of Seller’s adjoins, abuts
or is adjacent to any of the Owned Real Property.

(g) Other than as set forth in Schedule 3.10(g), the Seller has no oral or
written agreement with any real estate broker, agent or finder with respect to
the Owned Real Property that would require a fee to be paid at any time for any
reason as it relates to the Owned Real Property.

(h) The Seller does not own any Mortgages in respect of the Owned Real Property.

(i) Except as set forth on Schedule 3.10(i), the Owned Real Property, fixtures
thereon and Improvements, are in good operating condition and, to the Seller’s
Knowledge, without structural defects.

(j) The mechanical and other building systems (including, without limitation,
the roof on any of the Improvements) located on the Owned Real Property, are
(1) in good operating condition, and, to the Seller’s Knowledge, no condition
exists requiring material repairs, alterations, replacements or corrections, and
(2) suitable and appropriate in all respects for their current use.

(k) The Owned Real Property and the Improvements constitute all of the land,
buildings, structures, improvements, fixtures or other interests and rights in
real property that are currently used or occupied by the Seller in connection
with the Business and the Purchased Assets.

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(l) To Seller’s Knowledge, no Person (other than the Seller) has any interest
in, or rights to, the mineral, oil, gas, and other natural resources arising
from the Owned Real Property.

(m) To Seller’s Knowledge, except as set forth on Schedule 3.10(m), there exist
no outstanding requirements or recommendations by (1) any insurance policy
maintained by Seller currently insuring any Owned Real Property, (2) any board
of fire underwriters or other body exercising similar functions with respect to
any Owned Real Property or (iii) the holder of any encumbrance on any Owned Real
Property, in each such case that require or recommend any repairs or work of any
material nature be performed on such Owned Real Property.

Section 3.11 Personal Property.

(a) The Seller owns, free and clear of any Liens other than Permitted
Exceptions, all of the personal property (including Inventory) included in the
Purchased Assets.

(b) All machinery and equipment owned or leased by the Seller in respect of the
Business which is in regular use is in good working order and repair, ordinary
wear and tear excepted.

(c) Except as set forth on Schedule 3.11(c) all Inventory included in the
Purchased Assets is of a quality and condition usable (and in the case of
finished goods, saleable) in the ordinary course of business for the purposes
for which intended net of any applicable reserves reflected in the Financial
Statements. Schedule 3.11(c) sets forth a true and complete list of Inventory
included in the Purchased Assets.

(d) All leases for personal property are set forth on Schedule 3.11(d).

Section 3.12 Contracts and Commitments.

(a) Except as listed on Schedule 3.12(a), the Seller is not in respect of the
Business a party to, or subject to, any oral or written:

(i) Contract for the purchase of products for resale, materials, parts or
supplies and involving any expenditure by the Seller of more than $20,000;

(ii) Contract for the purchase of machinery or equipment or for construction,
and involving any expenditure by the Seller of more than $20,000;

(iii) Contract to obtain services and involving any expenditure by the Seller of
more than $20,000;

(iv) lease (as lessee) of machinery, equipment or other personal property
requiring annual rental payments of $20,000 or more;

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(v) Contract for the sale or lease of its products or the Purchased Assets or
the furnishing of its services and involving consideration of more than $20,000;

(vi) Contract pursuant to which a party other than the Seller has a right to
renegotiate or require a reduction in price or refund of payments made to the
Seller;

(vii) Contract providing for payment by the Seller of liquidated damages or
penalties in the event of breach;

(viii) contract with any government entity;

(ix) Contract that relates to the acquisition of any business, a material amount
of stock or assets of any other Person or any real property (whether by merger,
sale of stock, sale of assets or otherwise), in each case involving amounts in
excess of $20,000;

(x) Contracts relating to indebtedness (including, without limitation,
guarantees, but not agreements relating to trade receivables), in each case
having an outstanding principal amount in excess of $20,000;

(xi) Contract between or among the Seller on the one hand and any Associate of
Seller on the other hand; and

(xii) Contracts imposing non-compete restrictions, geographic restrictions,
restrictions with regard to the passing of time or other limits on the operation
or scope of the Business.

(b) True and complete copies of all Assigned Contracts, and all amendments,
supplements and modifications thereto have been delivered to Purchaser.

(c) Each of the Contracts to which the Seller is subject or a party in respect
of the Business is a valid and binding agreement enforceable in accordance with
its terms and is in full force and effect and (i) no material default by the
Seller or, to Seller’s Knowledge, by any other party exists under any provision
thereof, (ii) neither Seller nor its Associates have received any cancellation
or non-renewal notice from any party to a Contract or taken any action that
constitutes a cancellation of any of Contracts, (iii) no condition or event
exists which after notice or lapse of time or both would constitute a material
breach or default thereunder by the Seller any Associate of Seller or, to
Seller’s Knowledge, by any other party; and (iv) except as set forth on Schedule
3.12(c), the assignment thereof pursuant to this Agreement will not result in
termination of, or result in a right of termination under, any such agreement,
require the consent of any party thereto or bring into operation any other
provision thereof.

Section 3.13 Suppliers and Customers.

(a) Set forth in Schedule 3.13(a) is a complete and accurate list of:

(i) the names and addresses of the ten largest suppliers (by dollar volume) of
products and services to the Business during Seller’s last two fiscal years
(each a “Major Supplier”);

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(ii) the names and addresses of any sole source suppliers of significant goods
or services to the Business with respect to which practical alternative sources
of supply are not available on comparable terms and conditions;

(iii) the dollar volume of purchases from each supplier referred to in
paragraphs (a) and (b) above during each of the last two fiscal years; and

(iv) the names and addresses of the ten largest customers (by dollar volume) of
the Business during Seller’s last two fiscal years (each a “Major Customer”),
together with the annual dollar volume of such revenues for each such customer.

(b) There exists no actual or, to Seller’s Knowledge, threatened, material
termination, cancellation, reduction or limitation of, or any material
modification or change in, the business relationship of Seller with any Major
Customer, or any customer whose purchases individually or in the aggregate are
material to the Business, or with any Major Supplier, or whose sales
individually or in the aggregate are material to the operation of the Business.
Seller shall not sell or otherwise disclose such lists to any third party except
pursuant to this Agreement.

(c) To Seller’s Knowledge, there is no material adverse condition affecting the
supply of materials available to Seller in the conduct of the Business.

Section 3.14 Insurance. Set forth in Schedule 3.14 is a complete and accurate
list of all current insurance policies of the Seller in respect of the Business
and all other insurance policies of the Seller or any Associate of Seller under
which any claim could be made by or on behalf of the Seller in respect of the
Business.

Section 3.15 Labor Agreements and Actions. Except as set forth on Schedule 3.15:

(a) the Seller is not in respect of the Business a party to or bound by or
subject to any Contract with any labor union;

(b) there are in respect of the Business no existing or, to the Seller’s
Knowledge, threatened (i) labor strikes, work stoppages, slow downs or
interruptions of work affecting the Business, (ii) arbitrations or material
grievances involving the Business, or (iii) other labor controversies which
would have a Material Adverse Effect on the financial condition, results of
operations, properties or business of the Business;

(c) the Seller is not now, nor has the Seller within the last six months
preceding the date of this Agreement, engaged in respect of the Business in any
unfair labor practice within the meaning of the National Labor Relations Act;

(d) there are no pending or, to the Seller’s Knowledge, threatened unfair labor
practice charges or discrimination complaints relating to race, color, national
origin, sex, religion, age, marital status or handicap against the Seller in
respect of the Business before any federal, state or local board, department,
commission or agency nor, to the Seller’s Knowledge, does any basis therefor
exist; and

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(e) the Seller is not now, and during the past three years the Seller has not
been, charged with, or to the Seller’s Knowledge threatened with, a charge of
violation, or under investigation with respect to a possible violation, in
respect of the Business of any provision of any Laws relating to unfair labor
practices or equal employment opportunity; and there have been no claims,
inquiries, citations, penalties assessed or other proceedings of federal, state
or local governmental agencies in respect of the Seller in respect of the
Business during the past three years which relate to any provision of any Laws
relating to unfair labor practices or equal employment opportunity.

Section 3.16 Employee Benefit Plans.

(a) Schedule 3.16(a) lists all Benefit Plans (i) which are maintained by the
Seller or any Associate of Seller for the benefit of the present or former
employees of the Seller in respect of the Business or any predecessor thereof or
(ii) to which the Seller is required to contribute in respect of the Business.

(b) Except with respect to any Pension Plan listed in Schedule 3.16(a) which is
a Multiemployer Plan, each such Pension Plan is in material compliance with the
provisions of ERISA, the applicable provisions of the Internal Revenue Code of
1986, as amended (the “Code”) and all other applicable Law. Each Benefit Plan
that is intended to be qualified under Section 401(a) of the Code (a “Qualified
Benefit Plan”) is so qualified and has received a favorable and current
determination letter from the IRS and to the extent that such favorable
determination was conditioned upon adoption of amendments by a specified date,
such amendments were timely adopted, to the effect that such Qualified Benefit
Plan is so qualified and that the plan and trust related thereto are exempt from
federal income taxes under Section 401(a) and 501(a), respectively, of the Code,
and nothing has occurred that could reasonably be expected to cause the
revocation of such determination letter from the IRS, nor has any such
revocation been threatened. No Benefit Plan has within the three years prior to
the Closing been the subject of an examination or audit by a governmental
authority or the subject of an application or filing under or is a participant
in, an amnesty, voluntary compliance, self-correction, or similar program
sponsored by any governmental authority.

(c) No such Pension Plan, nor any trust created thereunder, nor any trustee or
administrator thereof, has engaged in a transaction which might subject such
Pension Plan, trustee or administrator thereof, or any party dealing with such
Pension Plan which is not a Multiemployer Plan or trust, to the tax or penalty
on prohibited transactions imposed by Section 4975 of the Code or to a civil
penalty imposed by Section 502 of ERISA.

(d) Except as disclosed on Schedule 3.16(d), since September 2, 1974, no such
Pension Plan subject to Title IV of ERISA, other than a Multiemployer Plan, has
been completely or partially terminated, nor to the Seller’s Knowledge has there
been any filing of any notice of intent to terminate under Section 4041 of ERISA
or any other receipt by the Seller of notice of the institution by the Pension
Benefit Guaranty Corporation of any proceeding under Section 4042 of ERISA
involving a Pension Plan, nor has there been any “reportable event”, as such
term is defined in Section 4043(b) of ERISA, with respect to any such Pension
Plan since the effective date of said Section 4043(b).

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(e) Since April 29, 1980, the Seller has not in respect of the Business suffered
or otherwise caused a “complete withdrawal” or “partial withdrawal”, as such
terms are respectively defined in Section 4203 and 4205 of ERISA, with respect
to any Multiemployer Plan, nor will the consummation of this transaction result
in such a complete withdrawal nor partial withdrawal, nor is Seller or any
Associate of Seller liable or contingently liable for any withdrawal liability
under Title IV of ERISA.

(f) Each Welfare Plan listed in Schedule 3.16(a) is in material compliance with
the provisions of all applicable Laws.

(g) All material reports and documents with respect to such Pension Plans and
such Welfare Plans that are required by ERISA to be filed or distributed have
been timely filed or distributed.

(h) The Seller is in respect of the Business in compliance with all Laws
including, without limitation, the consolidated omnibus Budget Reconciliation
Act of 1985, which require the continuation of benefit coverage under any
Benefit Plan upon the happening of certain events, such as the termination of
employment or change in beneficiary or dependent status.

Section 3.17 Taxes.

(a) The Seller has:

(i) duly and timely filed, or caused to be filed, in accordance with applicable
Law all Tax Returns applicable to or including the Seller, each of which is
true, correct and complete,

(ii) duly and timely paid in full, or caused to be paid in full, all Taxes due
and payable (whether or not shown on any Tax Return) on or prior to the Closing
Date for which the Seller is or could liable (in whole or in part), and

(iii) properly accrued in accordance with GAAP on its books and records a
provision for the payment of all Taxes that are due, are claimed to be due, or
may or will become due with respect to any Tax period (or portion thereof)
ending on or prior to the Closing Date.

(b) No extension of time to file any Tax Return for or including the Seller,
which Tax Return has not since been filed in accordance with applicable Law, has
been filed.

(c) With respect to or otherwise inclusive of or relating to the Seller, no Tax
Return has ever been filed, and no Tax has ever been determined, on a
consolidated, combined, unitary or other similar basis (including, but not
limited to, a consolidated federal income Tax return). There is no actual or
potential theory or circumstance (including, but not limited to, as a transferee
or successor, under Code Section 6901 or Treasury Regulation Section 1.1502-6,
as result of a Tax sharing agreement or other contract or by operation of law)
under which the Seller is or may be liable for any Tax determined, in whole or
in part, by taking into account any income, sale, asset of or any activity
conducted by any other Person.

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(d) The Seller has complied in all respects with all applicable Law relating to
the deposit, collection, withholding, payment or remittance of any Tax
(including, but not limited to, Code Section 3402).

(e) With respect to the Seller or otherwise inclusive of or relating to the
Seller, no proceeding is pending, threatened or proposed with regard to any Tax
or Tax Return.

(f) With respect to the Seller or otherwise inclusive of or relating to the
Seller, the statute of limitations applicable or relating to any Tax or any Tax
Return has never been modified, extended or waived, nor has any request been
made in writing for any such modification, extension or waiver.

(g) With respect to the Seller or otherwise inclusive of or relating to the
Seller, no jurisdiction where no Tax Return has been filed or no Tax has been
paid has made or threatened to make a claim for the payment of any Tax or the
filing of any Tax Return.

(h) The Seller is not nor has it ever been a beneficiary or otherwise
participated in any reportable transaction within the meaning of Treasury
Regulation Section 1.6011-4(b)(1).

(i) The Seller is not a “foreign person” as defined in Section 1445 of the Code.

Section 3.18 Legal Proceedings. Except as set forth in Schedule 3.18, there are
no claims, charges, arbitrations, grievances, actions, suits, proceedings or
investigations pending or, to the Seller’s Knowledge, threatened by or against
or affecting the Seller or its Associates in respect of the Business, the
Purchased Assets or the Assumed Liabilities.

Section 3.19 Judgments, Decrees and Orders. The Seller is not a party to nor
subject to any judgments, decrees, orders, writs, injunctions, rulings,
decisions or awards of any court or Governmental Authority in respect of the
Business or to which any of the Purchased Assets or the Assumed Liabilities is
subject.

Section 3.20 Compliance With Laws.

(a) The Seller is not in violation of any Laws, except for violations which
individually, or in the aggregate, do not and would not reasonably be expected
to have a Material Adverse Effect on the financial condition, results of
operations, business, properties, assets or liabilities of the Seller in respect
of the Business.

(b) Except as set forth in Schedule 3.20(b), the Seller is not now, and during
the past three years the Seller has not been, charged with, or to the Seller’s
Knowledge threatened with, a charge or violation, or under investigation with
respect to a possible violation, of any provision of any Laws applicable to the
Business. Except as set forth in Schedule 3.20(b), there have been no claims,
inquiries, citations, penalties assessed or other proceedings of Governmental
Authorities against the Seller in respect of the Business during the past three
years which relate to any provision of any Laws.

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(c) Except as disclosed in Schedule 3.20(c) or which has not and would not
reasonably be expected to have, individually or in the aggregate, a Material
Adverse Effect on the Seller in respect of the Business, the Purchased Assets or
the Assumed Liabilities, the Seller has obtained all Permits which are required
in connection with the Business and operations of the Business and to use or own
the Purchased Assets, and is in full compliance therewith. Schedule 3.20(c)
lists all such Permits except for the Permits listed in Schedule 3.21(b) in
response to Section 3.21(b). All such Permits are valid and in full force and
effect. The Seller has not engaged in any conduct which could cause revocation
or suspension of any of such Permits and no action or proceeding which could
result in the revocation or suspension of any thereof is pending or, to the
Seller’s Knowledge, threatened.

(d) Except as disclosed in Schedule 3.20(d) and except for transfers, approvals
and authorizations listed in Schedule 3.21(b) in response to Section 3.21(b), no
transfers of such Permits and no approvals or authorizations of Governmental
Authorities will be required to permit the Purchaser to continue the Business as
presently conducted after sale of the Business to the Purchaser pursuant to this
Agreement.

(e) Except as disclosed on Schedule 3.20(e), (i) all products manufactured by
Seller meet all applicable regulatory requirements in all material respects for
the Business as currently conducted and (ii) Seller has not received any notices
that such products, or any anticipated products, do not, or will not, meet
applicable regulatory requirements.

Section 3.21 Environmental Matters.

(a) Except as disclosed in Schedule 3.21(a), the Seller’s operation of the
Business is in material compliance with all Environmental Laws.

(b) The Seller has obtained all material Permits, and will comply with,
Environmental Laws that are required in connection with the sale or transfer of
the Business and Owned Real Property to Purchaser and operation of the Business
and the Seller is in full compliance therewith. Schedule 3.21(b) lists all such
Permits and approvals required by Governmental Authorities under Environmental
Laws to sell or transfer the Business, Purchased Assets or Owned Real Property.
All such Permits are valid and in full force and effect. The Seller has not
engaged in any conduct which could cause revocation or suspension or any
modification of any such Permits and no action or proceeding which could result
in the revocation or suspension or modification of any thereof is pending or, to
the Seller’s Knowledge, threatened. Except as disclosed in Schedule 3.21(b), no
transfers of such Permits and no approvals or authorizations of Governmental
Authorities under Environmental Laws will be required to permit the Purchaser to
continue the Business as presently conducted after sale of the Purchased Assets
to the Purchaser pursuant to this Agreement.

(c) Except as disclosed in Schedule 3.21(c), the Seller has not used or
permitted others, by contract or otherwise, to use its facilities or any Owned
Real Property (whether owned, leased or otherwise controlled) to generate,
manufacture, refine, transport, treat, store, handle, dispose, transfer,
produce, process or use Hazardous Substances nor has the Seller, by contract or
otherwise, arranged for others to handle or manage Hazardous Substances
produced, owned or controlled by the Business, whether on or off any Owned Real
Property.

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(d) Except as disclosed in Schedule 3.21(d), the Seller has not caused or
permitted, and to the Seller’s Knowledge there has not been, any releasing,
spilling, leaking, pumping, pouring, emitting, emptying, discharging, injecting,
escaping, leaching or disposing of any Hazardous Substances on or from, or onto,
any Owned Real Property.

(e) Except as disclosed in Schedule 3.21(e), the Seller has not been notified of
any potential claim or liability or request for information under any
Environmental Laws in respect of the Business or the Owned Real Property, and
has not received notice of, and the Seller is not aware of, any such potential
claim or liability.

(f) Except as set forth in Schedule 3.21(f), the Seller is not now, and during
the past three years the Seller has not been charged with, or to the Seller’s
Knowledge, threatened with a charge of, or under investigation with respect to a
possible violation of any provision of any Environmental Laws, in respect of the
Business.

(g) The Seller has made available to the Purchaser true and complete copies of
all documents, writings or reports regarding environmental conditions on the
Owned Real Property, including, without limitation, all correspondence to and
from public authorities, all filings with public authorities, all external
environmental audits within Seller’s possession and all internal environmental
audits performed by Seller within the last two (2) years.

(h) There are no former or current underground storage tanks for Hazardous
Substances installed, removed or maintained by the Seller on the Owned Real
Property.

(i) The Seller is not a party to, or negotiating, any agreements, orders or
decrees with third parties or Governmental Authorities for access or to settle,
resolve, fund, contribute, design, implement, monitor, maintain, restore or
implement the remediation of Hazardous Substances or damages to natural
resources in any way related to the Owned Real Property or the Business.

(j) To Seller’s Knowledge, Seller or its predecessors have previously owned, or
operated at, only the following properties in the Commonwealth of Massachusetts:
36 Arlington Street, Watertown, MA; 221-225 Crescent Street, Waltham, MA; and
829 Middlesex Turnpike, Billerica, MA.

Section 3.22 Consummation of this Transaction. Except for filings and approvals
listed in Schedule 3.21(b) in response to Section 3.21(b): (i) no filing by the
Seller with any Governmental Authority is required with respect to the execution
or delivery of this Agreement or the performance of the transactions
contemplated by this Agreement; and (ii) the consummation by the Seller of the
transactions contemplated by this Agreement is not subject to the prior consent
or approval of any Governmental Authority.

Section 3.23 Intellectual Property.

(a) Schedule 3.23(a) lists all Industrial Property that the Seller or any
Associate of Seller, owns and uses solely in the Business, specifying the owner
thereof; and (ii) all domain names and social media accounts used by the Seller
in respect of the Business. The Industrial Property listed constitutes all
material Industrial Property currently used or held for use or necessary for the
operation of the Business as presently conducted by Seller.

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(b) To the extent indicated on Schedule 3.23(a), all listed Industrial Property
has been and currently remains duly registered with, filed in or issued by the
appropriate governmental agencies of the United States. The Industrial Property
is valid and enforceable and is not and to the Knowledge of Seller, has not been
the subject of any proceeding regarding opposition to registration, cancellation
or similar claim naming Seller or any Seller Associate as a party, or any other
challenges to the validly of the Industrial Property, and, to the Knowledge of
Seller, no such proceeding has been threatened.

(c) Schedule 3.23(c) lists all Contracts and identifies all parties to such
Contracts under which the Seller in respect of the Business or any Associate of
Seller on behalf of the Seller in respect of the Business, or any predecessor
thereof, either obtains or grants the right to use any Intellectual Property.
Except for the Contracts identified in Schedule 3.23(c), and embedded licenses
to use as they are automatically granted with the sale of products or services,
there are no material agreements or other arrangements pursuant to which Seller
has licensed to any other Person or otherwise permitted any other Person to use
(through non-assertion, settlement or similar agreements or otherwise) any of
the Intellectual Property.

(d) Immediately following the Closing Date, Purchaser will have and be permitted
to exercise all of Seller’s rights under, and will have the same rights with
respect to all Intellectual Property, to the same extent Seller would have had,
and been able to exercise, had this Agreement not occurred, without payment of
any additional amounts or consideration other than ongoing fees, royalties or
payments that Seller would have been required to pay if such Agreement had not
occurred; provided the parties have complied with the terms and conditions of
the Contracts.

(e) The Seller or an Associate of Seller has good title to all of the
Intellectual Property which Seller or an Associate of Seller owns and uses
solely in the Business (including the Industrial Property listed in Schedule
3.23(a)) free and clear of any Liens. The Seller or an Associate of Seller owns
or has the right to use without payment to a third Person all of the
Intellectual Property. The rights of Seller or an Associate of Seller in, to and
under the Intellectual Property are freely transferable and assignable to
Purchaser. To the Knowledge of Seller, neither Seller nor any Associate of
Seller has received any opinion of counsel (whether internal or external,
written or oral) relating to the patentability infringement validity or
enforceability of any Intellectual Property.

(f) The Seller has the sole and exclusive right to use all of the Intellectual
Property that the Seller or an Associate of Seller owns and uses in the
Business. To the Seller’s Knowledge, none of the products, apparatus, methods or
services that the Seller makes, uses or sells in respect of the Business
infringes or violates the Intellectual Property of others, nor, to the Knowledge
of Seller, shall Purchaser’s use of the Intellectual Property following the
Closing, with or without the ITT Name, in substantially the same manner in all
material respects as it was used prior to the Closing, infringe or violate any
Intellectual Property or other right of any third Person . None of the
Intellectual Property that the Seller owns or uses in respect of the Business
is, to the Seller’s Knowledge, being infringed by others.

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(g) The Seller is not using in respect of the Business any secret formulae,
trade secrets, secret processes, computer programs, confidential information or
know-how of others. There are no claims or demands of any other person, firm or
corporation pertaining to Intellectual Property which the Seller owns or uses in
respect of the Business, and no proceedings have been instituted, are pending
or, to the Seller’s Knowledge, are threatened, which challenge the rights of the
Seller or any Associate of Seller in respect thereof. Except for off-the-shelf
software and/or information technology or communication devices and except for a
license to use the mark “ITT”, the Seller has no Licensed Intellectual Property
material to the operation of the Business.

(h) Schedule 3.23(h) lists all off the shelf software material to the operation
of the Business and identifies whether it is (i) covered by a fully paid license
transferred, (ii) running royalty bearing license transferred, or (iii) NOT
transferred.

Section 3.24 Employees.

(a) Schedule 3.24(a) contains a list of all of the employees of the Seller
involved exclusively in the Business, none of whom are union members (the
“Salaried Employees”) and which list includes the current title and pay rate or
salary for each such employee.

(b) Schedule 3.24(b) sets forth for each of the Salaried Employees, the number
of unused vacation days and sick days to which each such employee is entitled as
of the date hereof.

(c) Seller is in compliance with the Worker Adjustment and Retraining
Notification Act and the regulations promulgated thereunder (“WARN”).

Section 3.25 Brokers or Finders. Except for EuroConsult, Inc., the Seller has
not incurred any obligation, contingent or otherwise, for broker’s fees or
similar payments in connection with the purchase and sale of the Purchased
Assets.

Section 3.26 Powers of Attorney. There are no outstanding powers of attorney of
the Seller in respect of the Business other than those issued in the ordinary
course of business with respect to insurance, Intellectual Property and Tax
matters, all of which are set forth on Schedule 3.26.

Section 3.27 Accounts Receivable. Schedule 3.27 sets forth a true and complete
list of the Accounts Receivable as of April 25, 2015. All of the Accounts
Receivable have or will have arisen out of bona fide transactions in the
ordinary course of business and are carried on Seller’s books and records at
values determined in accordance with GAAP consistently applied in accordance
with Seller’s accounting policies. Except as set forth on Schedule 3.27, to
Seller’s Knowledge, no request or agreement for deduction or discount has been
made with respect to any of such Accounts Receivable.

Section 3.28 Accounts Payable. All Accounts Payable that are included in the
Assumed Liabilities are separately listed on Exhibit A as “Accounts Payable.”
All Accounts Payable (i) have arisen in the ordinary course of the business and
in amounts consistence with

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the historical experience of the Business, and (ii) are solely for the benefit
of the Business (and not for any other portion of Seller’s business activities
or those of any of Seller’s Associates). Seller shall be responsible for paying
all Accounts Payable not included in the Assumed Liabilities.

Section 3.29 Product Warranties. To Sellers Knowledge, there are no liabilities
for product returns other than those arising in the ordinary course of business
that would reasonably be expected to be incurred after Closing. To the Sellers
Knowledge, there are no threatened claims for (a) product returns, (b) Warranty
Obligations or (c) product services other than in the ordinary course of
business. To Sellers Knowledge, there does not presently exist any circumstances
that would constitute a valid basis for any voluntary or governmental recall of
any product sold or distributed by the Sellers in the course of or that relates
to the Business.

Section 3.30 Ordinary Course. Since the Balance Sheet Date, Seller has conducted
the Business in the ordinary course and consistent with prior practices in all
material respects.

ARTICLE IV

REPRESENTATIONS AND WARRANTIES OF THE PURCHASER AND PARENT

The Purchaser and Parent, jointly and severally, represent and warrant to the
Seller as follows:

Section 4.1 Corporate Organization. The Purchaser is a limited liability company
duly organized, validly existing and in good standing under the laws of the
State of Delaware. The Parent is a corporation duly organized, validly existing
and in good standing under the laws of the State of Minnesota.

Section 4.2 Due Authorization; Authority of Purchaser and Parent;
Enforceability.

(a) Each of the Purchaser and the Parent has all requisite power and authority
to make, execute, deliver and perform this Agreement and the Transaction
Documents to which each is a party and to consummate the transactions
contemplated hereby and thereby.

(b) The execution and delivery by Purchaser and the Parent of this Agreement and
the other Transaction Documents to which each is a party has been, and the
consummation by Purchaser and the Parent of the transactions contemplated hereby
and thereby have been, duly authorized by all necessary corporate action on the
part of Purchaser and the Parent, and no other corporate proceeding is necessary
for the execution and delivery of this Agreement or such other agreements by
Purchaser and the Parent or the performance by Purchaser and the Parent of their
obligations hereunder or thereunder.

(c) This Agreement and each of the Transaction Documents to which each of the
Purchaser and Parent is a party constitutes the legal, valid and binding
obligation of each enforceable against each of them in accordance with their
respective terms, except as enforcement of such terms may be limited by
bankruptcy, insolvency, reorganization, moratorium-or similar laws affecting the
enforcement of creditors’ rights generally and by the availability of equitable
remedies and defenses.

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Section 4.3 No Violation. The execution and delivery of this Agreement and the
Transaction Documents to which each of Purchaser or Parent is a party and the
consummation of the transactions contemplated hereby and thereby will not
(i) violate or conflict with any provision of the governing documents of the
Purchaser or the Parent, (ii) violate or conflict with any provision of, or
result in the termination of, or the acceleration of (or entitle any party to
exercise a right to terminate or accelerate) any obligation under, any mortgage,
note, lien, contract, lease, franchise, license, permit, agreement, plan,
instrument, order, arbitration award, judgment or decree to which either the
Purchaser or the Parent is a party or by which either the Purchaser or the
Parent is bound, or require the consent of any party thereto, or (iii) violate
or conflict with any other material contractual or statutory restriction of any
kind or character to which either the Purchaser or the Parent is subject; or
(iv) violate in any material respect any Law or any decree or judgment of any
court or other Governmental Authority applicable to Purchaser or the Parent.
Except as set forth on Schedule 4.3, neither Purchaser nor Parent is or will be
required to obtain any consent from any person in connection with the execution
and delivery of this Agreement or the consummation of the transactions
contemplated hereby.

Section 4.4 Financing. The Purchaser has all funds, or immediate access to funds
(including through available credit facilities), necessary to pay the Purchase
Price and fulfill its obligations to the Seller hereunder.

Section 4.5 Brokers or Finders. Neither the Purchaser nor the Parent has
incurred any obligation, contingent or otherwise, for broker’s fees or similar
payments in connection with the purchase and sale of the Purchased Assets.

ARTICLE V

COVENANTS

Section 5.1 Title Insurance and Survey. As a condition to Purchaser’s execution
of this Agreement, Purchaser shall have received at its sole cost and expense:

(a) ALTA Owner’s Title Insurance Policies dated as of the Closing Date issued to
the Purchaser by a Title Insurer approved by the Purchaser with respect to the
Owned Real Property with survey, zoning, mechanics liens and, as appropriate,
“gap” coverage, which (i) insure in amounts reasonably acceptable to the
Purchaser that the fee simple absolute title in the real property described
therein is marketable and valid and vested in the Purchaser, subject only to
Permitted Exceptions and the exceptions listed in Schedule 3.10(a) in respect of
such property and to no other exceptions, printed or otherwise,
(ii) affirmatively insure against encroachments and against violations of
applicable covenants, conditions and restrictions and, where available,
compliance with zoning laws and regulations and (iii) contain endorsements to
the effect that the Title Insurer will not claim as a defense under the policy
failure of the insured to disclose to the Title Insurer prior to the date of the
policy any defects, liens, encumbrances or adverse claims not shown by public
records and known to the insured (but not known to the Purchaser) prior to the
Closing (the premiums for such policies as well as the title commitment and
survey charges, including, but not limited to, charges for title abstract and
examination, shall be paid by the Purchaser);

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(b) Current surveys of the Owned Real Property in form acceptable to the Title
Insurer showing all matters of survey, including, but not limited to, deed
record and occupied boundary lines, and the location of all buildings, other
improvements, easements, curb cuts, projections encroachments, rights of way and
streets; and

(c) Flood insurance, in the event a Hazard Certificate from the Federal
Emergency Management Agency shows the Owned Real Property is in any type of
flood zone or area.

Section 5.2 Seller Mail. Effective upon the Closing Date, Purchaser shall have
the right to receive and open all mail, packages and other communications
addressed to either Seller and delivered to the Owned Real Property, and the
Seller agrees to deliver promptly to Purchaser any such mail, packages or other
communications received directly or indirectly by the Seller that relates to the
Purchased Assets and Assumed Liabilities. Purchaser shall promptly deliver to
the Seller all mail, packages and other communications received by it that
relate to the Seller but do not relate to the Purchased Assets or Assumed
Liabilities.

Section 5.3 Collection; Inquiries. In recognition of the fact that following the
Closing, Seller may continue to receive payments in connection with Accounts
Receivable, Seller shall promptly upon the receipt by Seller of such funds (i.e.
upon funds clearing Seller’s lock-box or other applicable bank account), but no
less frequently than every other Friday (or other mutually agreed day each week)
following the Closing Date (or next Business Day, in the event a such mutually
agreed day is not a Business Day), remit all such payments to Purchaser by wire
transfer; provided that in the event the amounts held by Seller are less than
$2,000, the funds can be held until the later of the next regular payment date
and the amount of the funds reaching an aggregate of $2,000. Seller agrees to
use its reasonable best efforts to cooperate in notifying customers, or prior
customers, of the Business to make payments in connection with the
aforementioned Accounts Receivable and other Purchased Assets directly to
Purchaser and shall otherwise direct correspondence and inquiries relating to
the Business to Purchaser.

Section 5.4 Business Relations. Seller will reasonably cooperate with Purchaser
in Purchaser’s efforts to preserve Purchaser’s relations and goodwill with the
customers, suppliers, creditors, employees, agents, and other business relations
of Seller relating to the Purchased Assets or the Business that existed before
the date of this Agreement.

Section 5.5 Business Referrals. Seller will refer to Purchaser all customer and
supplier inquiries that Seller receives in connection with the Business
associated with the Purchased Assets and Assumed Liabilities.

Section 5.6 Non-Competition.

(a) Purchaser, Parent, and Seller agree that for a period of three (3) years
after the Closing (the “Restricted Period”), neither Seller nor any Person that
is at the time in question a direct or indirect subsidiary of ITT (the
“Restricted Parties”) shall, directly or indirectly, compete with the Business
(as conducted as of the Closing Date), or own an interest in, manage, operate,
join, control or participate in the ownership, management, operation or control
of, or act as a director, officer, employee, partner or consultant with, any
profit or non-profit business or

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organization, which competes with the Business (as conducted as of the Closing
Date) anywhere in the world; provided, that ownership of less than five percent
(5%) of the outstanding stock of any publicly traded entity shall not be deemed
to violate the foregoing restriction set forth in this Section 5.6(a). The time
period during which the restrictions set forth in this Section 5.6(a) apply
shall be extended by the length of time during which the Seller, or any
controlled Associate of the Seller, violates these restrictions in any respect.
Notwithstanding the foregoing, nothing in this Section 5.6(a) shall restrict
(A) the purchasing by the Seller or any of its Associates of products from a
competitor of the Business as a component part to be incorporated into a product
manufactured or sold by Seller or such Associate or (B) the manufacture and sale
by or on behalf of any Associate of any product that as of the date of this
Agreement is being manufactured and sold by or on behalf of such Associate or
(C) the acquisition by an Associate of any company or business (an “Acquired
Business”) whose operations would contravene this Section 5.6(a) (the “Competing
Operations”); provided, that (a) the Competing Operations represent less than
twenty percent (20%) of the total annual sales of such Acquired Business, or
(b) such Associate divests such Competing Business (at least to the extent
necessary to that it represents less than twenty percent (20%) of the total
annual sales of such Acquired Business) included within the Acquired Business
within one (1) year after the acquisition of such Acquired Business.

(b) During the period commencing on the Closing Date and ending on the first
anniversary of the Closing Date, none of the Restricted Parties shall, directly
or indirectly, (i) recruit, offer employment, employ or engage as a consultant
any employee of the Purchaser or its Associates who was an employee of the
Seller immediately prior to the Closing or (ii) solicit, knowingly persuade or
induce any employee of the Purchaser or its Associates who was an employee of
the Seller immediately prior to the Closing to terminate his or her employment
with the Purchaser or its Associates; provided that the foregoing restriction
set forth in this Section 5.6(b) does not apply to general advertisements or
other solicitations for employment distributed publicly and not directed at, or
in communication with, any particular employee or group of employees.

(c) During the period commencing on the Closing Date and ending on the first
anniversary of the Closing Date, Seller shall not directly or indirectly
solicit, knowingly persuade or induce any proprietor, lender, joint venturer,
lessor, customer, supplier or vendor which has a business relationship involving
the Business, to discontinue, reduce or modify in a manner adverse to the
Business such relationship with the Purchaser. Subject to the foregoing
sentence, Seller and its Associates may have a business relationship with such
proprietors, lenders, joint venturers, lessors, customers, suppliers or vendors
that is unrelated to the Business as conducted as of the Closing Date or not
competitive with the Business as conducted as of the Closing Date.

(d) In the event that the covenants in this Section 5.6 shall be determined by
any court of competent jurisdiction to be unenforceable by reason of its
extending for too great of time or over too great a geographical areas or by
reason of its being too extensive in any other respect, it shall be interpreted
to extend only over the maximum period of time for which it may be enforceable
and/or over the maximum geographical area as to which it may be enforceable
and/or to the maximum extent in all other respects as to which it may be
enforceable, all as determined by such court in such action.

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(e) Seller acknowledges that a breach of the covenants contained in this
Section 5.6 may cause irreparable damage to the Purchaser and the Business, the
exact amount which will be difficult to ascertain, and that remedies at law for
any such breach may be inadequate. Accordingly, the Seller agrees that if it or
any of its Associates breach any of the covenants contained in this Section 5.6,
in addition to any other remedy which may be available at law or in equity,
Purchaser shall be entitled to specific performance and injunctive relief,
without posting bond or any other security.

Section 5.7 Use of Seller Names and Marks. Purchaser acknowledges and agrees
that on the Closing Date, subject to Seller’s and its Associates’ performance of
services under the Transition Services Agreement, the Purchaser shall cease and
discontinue all uses of the “ITT” and “Cleveland Motion Controls” (together, the
“ITT Name”) and any use of the ITT Name in any logos and trademarks, and
complete the removal of the ITT Name from all products, technical information
and promotional materials (physical as well as electronic). Notwithstanding the
foregoing, the Purchaser shall be permitted to use the ITT Name: (a) on
products, technical information and other deliverables to the extent
specifically required for the Purchaser to comply with the requirements of any
Assigned Contract, (b) on existing hardcopy brochures and invoices for ten
(10) days following the Closing Date, and/or (c) on finished goods and inventory
for thirty (30) days following the Closing Date. The Purchaser agrees that from
and after the Closing Date that it (x) will not expressly, or by implication, do
business as or represent itself as the Seller, or (y) with respect to products
or services sold or provided by it after the Closing Date, will not represent
that such products or services are those of the Seller. The Purchaser
acknowledges and agrees that it shall not have any rights in the ITT Name and
shall not contest the ownership or validity of any rights of the Seller in or to
the ITT Name.

Section 5.8 Warranty Obligations. Following the Closing, the Purchaser will
perform all Warranty Obligations. Warranty Obligations to be paid, performed and
discharged by the Purchaser hereunder will be limited to the obligations stated
under the applicable warranties of the Seller. Products will be deemed to be
“maintained and sold” prior to the Closing Date if such products were completed,
sold and shipped prior to the Closing Date or were in finished goods Inventory.
Products that were not completed prior to the Closing Date or were in raw
materials or work in process Inventory will not be deemed to have been
manufactured and sold prior to the Closing Date and any warranty obligations
with respect to such products will be the sole responsibility of the Purchaser.
As consideration for the Purchaser’s performance of the Warranty Obligations,
the Seller will pay to the Purchaser on a monthly basis the direct cost
(material, labor and overhead, without mark-up) incurred by the Purchaser in
performing any Excluded Warranty Obligations. The Purchaser will submit an
invoice to the Seller on a monthly basis for all such costs incurred during the
preceding calendar month. All amounts reflected on such invoices will be payable
within ten (10) Business Days after the Seller’s receipt thereof.

ARTICLE VI

SURVIVAL AND INDEMNIFICATION

Section 6.1 Survival of Representations and Warranties. The representations and
warranties contained in this Agreement shall survive until the date that is
eighteen (18) months from the Closing Date, except (i) the Fundamental
Representations shall survive the Closing

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indefinitely; (ii) the representations and warranties set forth in Section 3.21
(Environmental Matters) shall survive for a period of five (5) years following
the Closing Date; and (iii) the representations and warranties set forth in
Sections 3.16 (Employee Benefit Plans) and 3.17 (Tax) shall survive for the full
period of all applicable statutes of limitations (giving effect to any waiver,
mitigation or extension thereof) plus sixty (60) days (such survival periods,
the “Survival Periods”); provided, however, that in all cases, representations
and warranties in respect of which an indemnification claim shall be pending as
of the end of the applicable period referred to above shall survive with respect
to such indemnification claim until the final disposition thereof. None of the
covenants or other agreements contained in this Agreement shall survive the
Closing Date other than those which by their terms contemplate performance after
the Closing Date, and each such surviving covenant and agreement shall survive
the Closing for the period contemplated by its terms.

Section 6.2 Indemnification.

(a) Subject to the other provisions of this Article VI, the Seller agrees to
indemnify the Purchaser and the Parent, and their respective officers,
directors, employees and agents (each individually a “Purchaser Indemnitee” and
collectively the “Purchaser Indemnitees”) and to hold each Purchaser Indemnitee
harmless from and against all damages (excluding consequential, indirect,
special or punitive damages), losses and expenses (including reasonable
attorneys’ fees and expenses) (“Losses”) actually suffered by Purchaser or
Parent caused by or arising out of any:

(i) any breach of any representation or warranty of Seller contained in this
Agreement;

(ii) any breach or non-fulfillment of any covenant, agreement or obligation to
be performed by Seller pursuant to this Agreement;

(iii) any claim in respect of any liabilities resulting from acts or omissions
of the Seller on or prior to the Closing Date, including , but not limited to,
any claim or liability with regard to any Tax arising with respect to, resulting
from or attributable to any period or portion thereof ending on or prior to the
Closing Date, other than Assumed Liabilities; and

(iv) the Excluded Liabilities.

(b) Subject to the other provisions of this Article VI, the Purchaser and the
Parent, jointly and severally, agree to indemnify the Seller, and its respective
officers, directors, employees and agents (each individually a “Seller
Indemnitee,” and collectively the “Seller Indemnitees”) and to hold each Seller
Indemnitee harmless from and against all Losses caused by or arising out of any:

(i) any breach of any representation or warranty of Purchaser or Parent
contained in this Agreement;

(ii) any breach or non-fulfillment of any covenant, agreement or obligation to
be performed by Purchaser pursuant to this Agreement;

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(iii) any claim in respect of any liabilities resulting from acts or omissions
of the Purchaser or Parent on or after the Closing Date, and

(iv) failure of the Purchaser to discharge any Assumed Liabilities.

Section 6.3 Limitations on Liabilities.

(a) Notwithstanding the provisions of this Article VI, (i) the Seller shall not
have any liability to Purchaser Indemnitees under Section 6.2(a)(i) unless and
until the amount of the aggregate indemnification obligations exceed Forty Five
Thousand Dollars ($45,000.00) (the “Threshold”), whereupon the Seller shall
indemnify the Purchaser Indemnitees for the amount of all Losses solely to the
extent that such Losses exceed the Threshold, and (ii) the aggregate amount of
the Seller’s liability under Section 6.2(a)(i) shall not exceed fifteen percent
(15%) of the Purchase Price, except (A) with respect to a breach of a
Fundamental Representation of Seller, in which case the aggregate amount of the
Seller’s liability under Section 6.2(a)(i) shall not exceed one hundred percent
(100%) of the Purchase Price, or (B) in the case of fraud or willful misconduct
by such party, in which case there shall be no cap on the aggregate amount of
the Seller’s liability.

(b) Notwithstanding the provisions of this Article VI, (i) neither the Purchaser
nor the Parent shall have any liability to Seller Indemnitees under
Section 6.2(b)(i) unless and until the amount of the aggregate indemnification
obligations exceed the Threshold, whereupon the Purchaser and the Parent shall
indemnify the Seller Indemnitees for the amount of all Losses solely to the
extent that such Losses exceed the Threshold, and (ii) the aggregate amount of
the Purchaser’s and Parent’s joint liability under Section 6.2(b)(i) shall not
exceed fifteen percent (15%) of the Purchase Price, except (A) with respect to a
breach of a Fundamental Representation of Purchaser, in which case the aggregate
amount of the Purchaser’s and Parent’s joint liability under Section 6.2(b)(i)
shall not exceed one hundred percent (100%) of the Purchase Price, or (B) in the
case of fraud or willful misconduct by such party, in which case there shall be
no cap on the aggregate amount of the Purchaser’s and Parent’s joint liability.

(c) The amount of any Losses for which indemnification is provided to a Seller
Indemnitee or a Purchaser Indemnitee shall be net of any actual cash insurance
recoveries or recoveries of indemnities from any third parties of the
indemnified party. If a party obtains such a recovery, such party’s indemnity
claim shall not be offset to the extent of the party’s expenses in obtaining
such recovery. Each Person entitled to indemnification hereunder or otherwise to
damages in connection with the transactions contemplated in this Agreement shall
take all commercially reasonable steps to mitigate all Losses after becoming
aware of any event or circumstance that could reasonably be expected to give
rise to Losses that are indemnifiable or recoverable hereunder or in connection
herewith.

(d) Payments by a Seller Indemnitee or a Purchaser Indemnitee in respect of any
Loss shall be reduced by an amount equal to any Tax benefit realized or
reasonably expected to be realized as a result of such Loss by the indemnified
party.

(e) The obligations to indemnify and hold harmless pursuant to Section 6.2 shall
survive the consummation of the transactions contemplated hereby until the end
of the

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applicable Survival Periods, except for claims for indemnification with respect
to which an indemnified party provides a notice for such claim on or before the
expiration of the Survival Period, which claims shall survive until final
resolution thereof.

(f) All indemnification payments under Article VI shall be adjustments to the
Purchase Price except as otherwise required by applicable Law.

Section 6.4 Indemnification Procedure as to Third Party Claims.

(a) Promptly after a Purchaser Indemnitee or a Seller Indemnitee (individually,
an “Indemnitee”) obtains knowledge of the commencement of any third party claim,
action, suit or proceeding or of the occurrence of any event or the existence of
any state of facts which may become the basis of a third party claim (any such
claim, action, suit or proceeding or event or state of facts being hereinafter
referred to in this Section 6.4 as a “Claim”), in respect of which an Indemnitee
is entitled to indemnification under this Agreement, such Indemnitee shall
notify the indemnitor under this Agreement (the “Indemnitor”) of such Claim in
writing, provided, however, that any failure to give such notice (i) will not
waive any rights of the Indemnitee except to the extent that the rights of the
Indemnitor are prejudiced thereby, and (ii) will not relieve the Indemnitor of
its obligations as hereinafter provided in this Section 6.4 after such notice is
given. With respect to any Claim as to which such notice is given by the
Indemnitee to the Indemnitor, the Indemnitor shall, subject to the provisions of
Section 6.4(b) below, be entitled to assume the defense and settlement of such
Claim with counsel reasonably satisfactory to the Indemnitee at the Indemnitor’s
sole risk and expense upon notice to the Indemnitee within fifteen (15) days of
the notice of the applicable Claim; provided, however, that the Indemnitee
(i) shall be permitted to join in the defense and settlement of such Claim and
to employ counsel at its own expense, (ii) shall cooperate with the Indemnitor
in the defense and settlement of such Claim in any manner reasonably requested
by the Indemnitor, and (iii) shall have the right to pay or settle such Claim at
any time in which event the Indemnitee shall be deemed to have waived any right
to indemnification therefor by the Indemnitor. In the event that the Indemnitor
elects not to assume the defense and settlement of a Claim, the Indemnitee shall
be entitled to pursue the defense and settlement of such Claim with counsel of
its choice and to be reimbursed by the Indemnitor for the reasonable attorney’s
fees and expenses incurred with respect thereto, provided that the Indemnitor
shall be entitled to join in the defense and settlement of such Claim and to
employ counsel at its own expense.

(b) If (i) the Indemnitor fails to assume the defense of such Claim or, having
assumed the defense and settlement of such Claim, fails reasonably to contest
such Claim in good faith, or (ii) the remedy sought by the claimant with respect
to such Claim is not solely for money damages, the Indemnitee, without waiving
its right to indemnification, may assume the defense and settlement of such
Claim, provided, however, that (i) the Indemnitor shall be permitted to join in
the defense and settlement of such Claim and to employ counsel at its own
expense, (ii) the Indemnitor shall cooperate with the Indemnitee in the defense
and settlement of such Claim in any manner reasonably requested by the
Indemnitee, and (iii) the Indemnitee shall not settle such Claim without
soliciting the views of the Indemnitor and giving them due consideration.

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(c) As used in this Section 6.4, the term Indemnitee shall be deemed to include
the plural thereof where the rights or obligations of more than one Indemnitee
may be involved.

Section 6.5 Other Indemnification Claims. Any indemnification claim made by an
indemnified party under this Article VI other than a claim relating to a third
party shall be made in writing to the indemnifying party promptly after
discovery of such claim describing the factual basis for such claim in
reasonable detail to the extent then known to the indemnified party. Within
thirty (30) days of its receipt of the indemnification claim, the indemnifying
party shall notify the indemnified party in writing of any dispute relating to
such indemnification claim containing sufficient detail to provide the
indemnified party with notice of the dispute (a “Dispute”). The parties agree to
use their reasonable efforts to resolve the Dispute in accordance with the
provisions of, and procedure described in, Section 8.10.

Section 6.6 Sole Remedy. The Purchaser, the Parent, and the Seller acknowledge
and agree that, except for the specific enforcement of rights and obligations as
provided in this Agreement, the sole and exclusive remedy of each with respect
to any and all Losses or any other damages or losses relating to the subject
matter of this Agreement shall be pursuant to the indemnification provisions set
forth in this Article VI.

ARTICLE VII

EMPLOYEES AND EMPLOYEE BENEFITS

Section 7.1 Employment. The Purchaser shall offer employment, commencing as of
the Closing Date to all employees of the Seller, as such employees are listed on
Schedule 7.1(“Offered Employees”), as such list may be updated by the Purchaser
prior to the Closing Date, contingent upon each of the Offered Employees
submitting to and successfully completing a drug screening for illegal drugs
promptly upon the request of the Purchaser. If there are any union employees,
such drug screening for illegal drugs may be subject to the procedures, if any,
set forth in the applicable collective bargaining agreement then in effect to
which Seller is a signatory. Each Offered Employee who accepts such offer of
employment with Purchaser and commences employment with Purchaser on the Closing
Date is referred to herein as a “Transitioned Employee” and collectively as the
“Transitioned Employees,” provided, however, that any employee of Seller who
does not successfully complete the drug screening for illegal drugs shall not be
a Transitioned Employee and any severance owed to such employee shall be paid by
Seller. The Purchaser agrees that it shall not close the plant located at the
Owned Real Property or terminate the employment without cause (which includes
without limitation, failure to perform the requirements of the position in a
satisfactory manner) of more than fifteen percent (15%) of the Transitioned
Employees prior to the first anniversary of the Closing Date.

Section 7.2 Compensation and Employee Benefits. The Purchaser shall, effective
as of the Closing Date, provide to the Transitioned Employees (i) base salaries
at least equal to their base salaries on the date immediately preceding the
Closing Date, and (ii) employee benefits under plans, programs and arrangements
substantially equivalent in the aggregate to either (A) those provided pursuant
to the plans, programs and arrangements (other than any related to the equity
securities of a Seller) of the Seller in effect on the date immediately
preceding the Closing

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Date, or (B) those provided to comparably situated employees of the Purchaser;
provided, however, that nothing herein shall prevent, from and after the Closing
Date, the amendment or termination of any specific plan, program or arrangement
or interfere with the Purchaser’s right or obligation to make such changes as
are necessary to conform with applicable Laws. Except as provided in
Section 7.3, Transitioned Employees shall be given credit for purposes of
eligibility and vesting for all service with a Seller to the same extent as such
service was credited for such purpose by such Seller, under each employee
benefit plan, program or arrangement of the Purchaser in which the Transitioned
Employees are eligible to participate; provided, however, that in no event shall
any Transitioned Employees be entitled to any credit to the extent that it would
result in a duplication of benefits with respect to the same period of service.
Except as set forth in Schedule 7.2, in the event that any Transitioned Employee
is terminated without cause by the Purchaser prior to the one-year anniversary
of the Closing Date, the Purchaser shall pay to such Transitioned Employee
severance in an amount equal to the greater of (i) the severance amount
determined under the severance policies of the Purchaser, or (ii) the severance
amount determined under the severance policies applicable to the Employees
immediately prior to the Closing, as described on Schedule 7.2.

Section 7.3 Healthcare Plans.

(a) Effective as of the Closing Date, pursuant to Section 7.2, Purchaser shall
offer to each Transitioned Employee the opportunity to elect healthcare
coverage. If a Transitioned Employee who is offered such coverage fails to elect
it in a timely fashion then, absent a change in status event permitting mid-year
elections, such Transitioned Employee may not elect healthcare coverage until
the next open enrollment period. Purchaser shall cause each healthcare plan of
the Purchaser in which the Transitioned Employees participate to (i) waive any
preexisting condition limitations for conditions covered under the applicable
healthcare plans of the Seller, except that Purchaser may require any
Transitioned Employee or eligible dependent thereof who immediately prior to the
Closing Date is in the process of satisfying any similar limitations under such
plans of any Seller to fully satisfy the balance of the applicable time period
for such limitation under the healthcare plans of the Purchaser, and (ii) honor
any deductible and out-of-pocket expenses due to co-insurance actually incurred
by the Transitioned Employees and their beneficiaries under such plans during
the portion of the calendar year prior to such participation in a plan of the
Purchaser; provided, however, that no such expenses shall be carried over from
any preceding calendar year.

(b) (i) The Seller shall be responsible for payment of any premiums for all of
the Seller’s welfare benefit plans, programs and arrangements provided to the
Employees as of the the Closing Date (“Seller’s Welfare Benefit Programs”)
relating to periods prior to 11:59 p.m. Massachusetts time of the Closing Date
(the “Effective Benefits Time”) and for any liability for all claims, expenses
and treatments, including administrative expenses related thereto, which are in
fact covered and payable under the terms of the Seller’s Welfare Benefit Program
and incurred prior to the Effective Benefits Time, irrespective of whether any
such claim is filed or submitted after the Effective Benefits Time.

(ii) Purchaser shall be responsible for payment of any premiums relating to
periods from and subsequent to the Effective Benefits Time for any welfare
benefit plans, programs and arrangements which Purchaser at its sole discretion,
subject to the

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requirements of Section 7.2 hereof, may provide to the Transitioned Employees
from and after the Effective Benefits Time (“Purchaser’s Welfare Benefits
Program”) and for any liability for all claims, expenses and treatments,
including administrative expenses related thereto, which are in fact covered and
payable under the terms of Purchaser’s Welfare Benefits Program and incurred
from and subsequent to the Effective Benefits Time.

Section 7.4 Seller Savings Plan. From and after the Closing Date, the Purchaser
shall permit the Transitioned Employees to immediately participate in the
Purchaser’s 401(k) Plan (the “Purchaser Savings Plan”). The Purchaser shall
cause the Purchaser’s Savings Plan to recognize service of Transitioned
Employees with the Seller attributable to any period before the Closing Date for
purposes of vesting thereunder. The Purchaser shall cause the trustee of the
Purchaser Savings Plan to accept on behalf of such plan a rollover contribution
from any Transitioned Employee or a direct rollover from the trustee of the
Seller’s 401(k) Savings Plan (the “Seller Savings Plan”) of a cash amount
representing such Transitioned Employee’s interest under the Seller Savings Plan
(including for this purpose, any loan to such Transitioned Employee which is
part of such Transitioned Employee’s account balance, provided that the loan is
rolled over to the Purchaser’s Savings Plan before the loan is treated as a
deemed distribution under the Seller Savings Plan).

Section 7.5 Terminations or Layoffs. In the event of any termination or layoff
by Purchaser of any Transitioned Employee on or after the Closing Date,
Purchaser will comply fully with all applicable Laws, including without
limitation any laws relating to employee notification (such as WARN and any
related state laws in the United States), and all laws relating to
discrimination in employment or unfair employment practices. Purchaser will be
responsible for all costs related to such termination or layoff of any
Transitioned Employee, including but not limited to severance expenses
(including without limitation any periodic or lump sum severance payments and
any employee benefits provided in connection with such severance payment), COBRA
continuation benefits, penalties, damages and attorneys’ fees related thereto.

Section 7.6 Vacation; Sick Time. The Purchaser shall provide all Transitioned
Employees with full credit for all accrued and unused, as of the Closing Date,
vacation days and sick days to the extent such accrued and unused vacation and
sick days are set forth on Schedule 3.24(b) hereto.

Section 7.7 Flexible Spending Accounts. Effective as of the Closing Date,
Purchaser shall provide Transitioned Employees with a flexible spending account
benefits plan (or plans) in accordance with Section 7.2. Following the Effective
Benefits Time, the Seller shall cause the accounts under its flexible spending
account plan for each Transitioned Employee to be transferred to Purchaser’s
flexible spending account plan, and Purchaser agrees that such accounts shall be
available to each such Transitioned Employee in the same manner they were
available under Seller’s flexible spending account plan.

Section 7.8 Disability. An Offered Employee who is absent from work due to
Disability as of the Closing Date shall, contingent on such Offered Employee
submitting to and successfully completing a drug screening test for illegal
drugs, subject to the procedures, if any, set forth in the applicable collective
bargaining agreement then in effect, shall be treated as a Transitional Employee
at such time as his or her Disability does not affect his or her ability to
perform the position held by such individual with the Business prior to such
Disability.

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Section 7.9 Assistance. The Seller and Purchaser agree to cooperate fully with
respect to the actions necessary to effect the transactions contemplated in this
Article VII, including the provision of records (including payroll records) and
information as each may reasonably requested from the other.

Section 7.10 No Assumption of Plans. With respect to the Transitioned Employees,
Purchaser is not assuming, and will not have any responsibility for the
continuation of any employee benefit plan, and Purchaser will not be deemed to
be a successor employer to the Seller with respect to any such plan. No employee
benefit plan adopted or maintained by Purchaser with respect to the Transitioned
Employees will be deemed a successor plan of the Seller.

Section 7.11 Purchaser’s Actions. Nothing in this Article VII shall require the
continued employment of any Person or prevent the Purchaser from taking any
action or refrain from taking any action which the Seller or any Associates of
Seller, prior to the Closing Date, could have taken or refrained from taking.

Section 7.12 No Third Party Rights. No provision of this Article VII shall
create nor is intended to create nor shall be construed to confer: (i) any third
party beneficiary rights in any employee or former employee, or any beneficiary
or dependent thereof, of the Business, the Seller, any Associate of Seller, or
the Purchaser in respect of continued employment or resumed employment or in
respect of any benefits that may be provided, directly or indirectly, under the
employee benefit plans, program, policy, practices, or arrangement of the
Business, the Seller, any Associate of Seller, or the Purchaser whether prior
to, on, or after the Closing Date; or (ii) any rights, remedies, obligations, or
liabilities, legal or equitable, on any person, firm, corporation, organization,
or other entity other than the Seller and the Purchaser (or their respective
successors and assigns).

Section 7.13 M&A Qualified Beneficiaries. The parties agree that Seller shall be
solely responsible for satisfying the continuation coverage requirements of Code
Section 4980B of the Code for all individuals who are “M&A Qualified
Beneficiaries” as such term is defined in Treasury Regulation
Section 54.4980B-9. For purposes of clarification, a Transitioned Employee who
accepts healthcare coverage with Purchaser shall not be deemed to be an M&A
Qualified Beneficiary.

Section 7.14 No Modification. Nothing contained herein, express or implied,
shall be construed to establish, amend, or modify any benefit plan, program,
agreement, or arrangement

ARTICLE VIII

MISCELLANEOUS

Section 8.1 Books and Records. At reasonable times after the Closing (a) the
Purchaser shall make available to the Seller for inspection and copying the
books and records which are Purchased Assets to the extent reasonably required
by the Seller for tax, financial

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reporting and other purposes, and (b) the Seller shall make available to the
Purchaser for inspection and copying any of Seller’s books and records relating
to the Business which are not Purchased Assets to the extent reasonably required
by the Purchaser for such purposes. Neither the Seller on the one hand nor the
Purchaser on the other hand will dispose of any of such books and records
without first offering them to the other.

Section 8.2 Further Assurances and Assistance. The Seller, the Purchaser, and
the Parent agree that each will execute and deliver to the other any and all
documents, and take such further acts, in addition to those expressly provided
for herein, that may be necessary or appropriate to effectuate the provisions of
this Agreement.

Section 8.3 Press Releases and Public Announcements.

(a) Neither Seller nor Purchaser or Parent shall issue any press release or make
any public announcement relating to the subject matter of this Agreement without
the prior written approval of the other; except as may be required by applicable
Law (including the Exchange Act), provided, however, that the Seller, the
Purchaser, Parent and their respective corporate parents may make any public
disclosure it believes in good faith is required by applicable Law (including
the Exchange Act), in which case such party will use commercially reasonable
efforts to advise the other party prior to such disclosure. The parties
acknowledge that (i) Parent’s ultimate parent and ITT are publicly held
companies subject to disclosure and reporting requirements under the Exchange
Act and (ii) the entry into this Agreement may require Parent’s ultimate parent
and ITT to disclose this Agreement and/or its subject matter by filing a Current
Report on Form 8-K and include this Agreement and/or its subject matter in
disclosures set forth in the Annual Reports on Form 10-K and Quarterly Reports
on Form 10-Q of ITT and Parent’s ultimate parent.

(b) If the receiving party of any public announcement or statement for review
pursuant to this Section 8.3 does not respond within twenty-four (24) hours from
submission, such press release, filing, or public disclosure shall be deemed
approved. While the reviewing party shall review comments by such receiving
party in good faith, the disclosing party shall have no obligation to accept or
incorporate any such comments if the proposed disclosure is required by
applicable Law (including the Exchange Act).

Section 8.4 Notices. Any notices or other communications required or permitted
hereunder shall be in writing and shall be given:

if to Purchaser, to:

SLMTI DS LLC

2002 Black Oak Ave.

Montevideo, MN 56265

Attention: Louis J. Belardi

Email: (856) 727-1683

Facsimile: louis.belardi@slindustries.com

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if to Parent to:

SL Montevideo Technology, Inc.

520 Fellowship Road, Suite A114

Mt. Laurel, New Jersey 08054

Attention: Louis J. Belardi

Facsimile: (856) 727-1683

E-mail: louis.belardi@slindustries.com

With a copy to:

Olshan Frome Wolosky LLP

65 East 55th Street

New York, New York 10022

Attention: Adam W. Finerman, Esq.

Email: afinerman@olshanlaw.com

Facsimile: 212.451.2222

if to the Seller or ITT, to:

ITT Corporation

1133 Westchester Avenue

White Plains, New York 10604

Attention: Mary Beth Gustafsson

Email: marybeth.gustafsson@itt.com

Facsimile: (914) 696-2990

With a copy to:

Day Pitney LLP

One International Place

Boston, MA 02110

Attention: Jeffrey A. Clopeck, Esq.

Email: jaclopeck@daypitney.com

Facsimile: (617) 345-4745

or such other address or facsimile number as such parties may hereafter specify
by notice to the other party. Each such notice, request or other communication
shall be effective (i) if given by facsimile, when such facsimile is transmitted
to the facsimile number specified in this Section 8.4 and the appropriate
acknowledgment of receipt of such facsimile is received, or (ii) if given by any
other means, when delivered at the address specified in this Section 8.4.

Section 8.5 Transaction Expenses. Each party to this Agreement shall bear and be
responsible for all fees, costs and expenses (including, without limitation,
legal and accounting fees and expenses) incurred by such party with respect to
the negotiation of this Agreement and the consummation of the transactions
contemplated hereby. Any related recording, filing fees or transfer taxes shall
be the obligation of the party customarily responsible for same in the county of
Northern Middlesex, Massachusetts.

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Section 8.6 Bulk Transfer Laws. The parties hereto hereby waive compliance with
any provisions of the so-called “bulk transfer laws” (Article 6 of the Uniform
Commercial Code) of any relevant jurisdiction which may be applicable to the
transactions contemplated by this Agreement.

Section 8.7 Miscellaneous Taxes and Expenses. Any sales, use or other tax or
recording cost imposed upon the transfer of the assets and business to be
acquired by the Purchaser pursuant to this Agreement shall be paid by the
Purchaser. All ad valorem property taxes and all rentals, water, electricity,
gas, telephone and other similar and usual expenses in respect of the Owned Real
Property and the Business shall be apportioned as of the Closing Date.

Section 8.8 Successors and Assigns. The provisions of this Agreement shall be
binding upon and inure to the benefit of the parties hereto and their respective
successors and assigns, provided that neither party may assign, delegate or
otherwise transfer any of its rights or obligations under this Agreement without
the consent of the other parties hereto.

Section 8.9 Governing Law. This Agreement shall be construed under and in
accordance with the laws of the State of New York, without giving effect to any
rules governing the conflicts of law.

Section 8.10 Disputes. Any controversy or claim arising out of this Agreement,
or the breach thereof, shall be settled by arbitration before a single
arbitrator in accordance with the Commercial Arbitration Rules of the American
Arbitration Association (“AAA”), and judgment upon the award rendered by the
arbitrator may be entered in any court having jurisdiction thereof. Any such
arbitration shall be held in New York, New York. Each party thereto shall pay
his own expenses, and the fee of the arbitrator and the administrative fee of
the AAA shall be paid one half by the Purchaser and one half by the Seller. The
provisions of this Section 8.10 shall not be construed to limit the right or
obligation of an Indemnitor pursuant to Section 6.4 to participate in or assume
the defense of a Claim, nor to entitle an Indemnitor to relitigate in an
arbitration proceeding issues determined in a court proceeding.

Section 8.11 Entire Agreement; Third Party Rights. This Agreement, the
Transaction Documents, the Schedules and the Exhibits hereto constitute the
entire understanding of the parties, supersede any prior agreements or
understandings, written or oral, between the parties with respect to the subject
matter thereof, and are not intended to confer upon any other person any rights
or remedies.

Section 8.12 Amendment; Waiver. This Agreement shall not be amended or modified
except by written agreement executed by each of the parties hereto. No provision
hereof shall be deemed waived except in writing executed by the waiving party.

Section 8.13 Effect of Captions. The captions in this Agreement are included for
convenience only and shall not in any way affect the interpretation or
construction of any of the provisions hereof.

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Section 8.14 Counterparts. This Agreement may be signed in any number of
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.

[Signature Page Follows]

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by their respective authorized representatives as of the day and year first
above written.

 

ITT TORQUE SYSTEMS, INC. By:  

/s/ Denise Brower

  Name: Denise Brower   Title: Authorized Signatory SLMTI DS LLC By:  

/s/ Thomas H. Lemley

  Name: Thomas H. Lemley   Title: President SL MONTEVIDEO TECHNOLOGY, INC. By:  

/s/ Thomas H. Lemley

  Name: Thomas H. Lemley   Title: President

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EXHIBIT A

Assumed Liabilities

1. Commitments or obligations arising under the Assigned Contracts, to the
extent arising or due to be performed following the close of Business on the
Closing Date, including the Accounts Payable.

2. The Accounts Payable, including those set forth on the exhibit attached
hereto.

3. The Assumed Warranty Obligations.

4. See attached.

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EXHIBIT B

Excluded Assets

 

  •   The Business has not operated as a separate “stand alone” entity. As a
result, certain Affiliates of Seller perform administrative and other similar
services on behalf of Seller under a shared services arrangement. Neither the
services performed under the shared services arrangement nor the assets
associated therewith are Purchased Assets. These services will continue to be
performed by Seller or its Affiliates pursuant to the Transition Services
Agreement for the applicable periods set forth therein.

 

  •   ITT Signage.

 

  •   Registered Trademark for “Cleveland Machine Controls” US Reg. No: 1732505
and associated common law rights

 

  •   Registered Trademark for “ITT” US Reg. Nos. 3,108,719 and 3,785,795 and
associated common law rights

 

  •   Oracle EBS R12 ERP

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EXHIBIT G

Allocation of Purchase Price

Owned Real Property-$2,000,000

The balance of the Purchase Price to be allocated among the remainder of the
Purchased Assets as mutually agreed between the parties within sixty (60) days
after the Closing Date.

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EXHIBIT H

Form of Guaranty

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GUARANTY

This Guaranty (this “Guaranty”) is made and delivered as of May     , 2015, by
ITT Corporation, an Indiana corporation (“Guarantor”) in favor of SLMTI DS LLC,
a Delaware limited liability company (“Purchaser”). Capitalized terms used but
not defined in this Guaranty shall have the meanings ascribed to them in the
Purchase Agreement (defined below).

WHEREAS, ITT Torque Systems, Inc. an Ohio corporation (“Seller”), Purchaser and
SL Montevideo Technology, Inc., a Minnesota corporation and parent of Purchaser
(the “Parent”) have entered into that certain Asset Purchase Agreement, dated as
of the date hereof (the “Purchase Agreement”), pursuant to which Purchaser will
purchase certain assets from Seller;

WHEREAS, Purchaser is a wholly owned indirect subsidiary of Guarantor; and

WHEREAS, a condition to Purchaser entering into the Purchase Agreement is that
Guarantor execute and deliver this Guaranty.

NOW, THEREFORE, for good and valuable consideration, the receipt and legal
sufficiency of which are hereby acknowledged, and in order to induce Purchaser
to enter into the Purchase Agreement, the Guarantor hereby agrees as follows:

1. Guarantor irrevocably and unconditionally guarantees to Purchaser the prompt
performance by Seller of all of Seller’s covenants, obligations and agreements
under the Purchase Agreement and the Transaction Documents (including the
Environmental Side Letter) that survive the Closing, including but not limited
to indemnification obligations (collectively, the “Obligations”). Any recovery
under this Guaranty shall include without limitation, all costs and expenses
(including reasonable attorneys’ fees) attributable to the Purchaser’s
successful exercise of its legal remedies against the Guarantor.

2. The obligations of Guarantor under this Guaranty shall be absolute,
unconditional and irrevocable, and shall remain in full force and effect until
the Obligations shall have been satisfied in full, it being the express purpose
and intent of Guarantor that its obligations hereunder shall not be discharged
except by payment, performance, discharge or other satisfaction in full of all
of Guarantor’s obligations hereunder. Such obligations shall not be in any
manner whatsoever affected, modified or impaired by the happening from time to
time of any assignment of the Obligations to a third party or any event or
action that would, in the absence of this clause, result in the release or
discharge of Guarantor, by operation of law or otherwise, from the performance
of observance of any obligation, covenant or agreement contained in this
Guaranty, or the default or failure of Guarantor to perform fully any
obligations set forth in this Guaranty.

3. Guarantor waives diligence, presentment, protest, notice, demand, dishonor
and notice of dishonor and any other defenses available to it hereunder as a
surety and agrees to be bound to the Obligations as fully as if it were a
co-obligor. The parties to the Purchase Agreement may enter into any amendment,
waiver or modification of the Purchase Agreement or other Transaction Document,
whether or not such amendment, waiver or modification would in any way increase
or decrease the extent of Guarantor’s obligations hereunder, without notice to
or consent of Guarantor and without thereby releasing Guarantor hereunder or
incurring any liability to Guarantor.

4. No failure or delay or lack of demand, notice or diligence in exercising any
right under this Guaranty shall operate as a waiver thereof, nor shall any
single or partial exercise of any such right preclude any other or further
exercise thereof or the exercise of any other right under this Guaranty.

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5. This Guaranty is an absolute, unconditional and continuing guaranty of
payment and performance and not of collection. Purchaser need not exhaust or
pursue any remedy or take any action in respect of the default of any Obligation
guaranteed hereby prior to or as a condition to proceeding directly under this
Guaranty against Guarantor.

6. Guarantor agrees that the obligation of Guarantor as a guarantor shall not be
impaired, modified, changed, released, or limited in any manner whatsoever by
any impairment, modification, change, release, or limitation of the liability of
the Seller in bankruptcy, resulting from the operation of any present or future
provision of the bankruptcy laws or other similar statute, or from the decision
of any court.

7. The validity of this Guaranty and the Guarantor’s obligations hereunder shall
in no way be terminated, reduced, impaired or otherwise affected by reason of,
and the Guarantor’s liability under this Guaranty shall be absolute and
unconditional irrespective of any lack of validity or enforceability of the
Purchase Agreement or any other Transaction Document; provided, however, that
Guarantor reserves the right to assert any defense to any claim made by the
Purchaser under this Guaranty that is otherwise available to Seller in response
to claims made by the Purchaser against the Seller under the Purchase Agreement
or any other Transaction Document.

8. This Guaranty is and shall be available to the successors and assigns of
Purchaser and is and shall always be fully binding upon the successors and
assigns of Guarantor, provided that Guarantor shall not assign any of its rights
or obligations hereunder without the prior written consent of Purchaser.

9. Guarantor represents and warrants to Purchaser, as of the date hereof and as
of the Closing Date, as follows: (a) Guarantor is a corporation, organized under
the laws of Indiana, and has all requisite power and authority to enter into
this Guaranty and consummate the transactions contemplated hereby; (b) Guarantor
is duly organized, validly existing and in good standing under the laws of its
jurisdiction of organization; (c) the execution, delivery and performance by
Guarantor of this Guaranty, and the consummation by Guarantor of the
transactions contemplated hereby, have been duly authorized by all necessary
corporate action on the part of Guarantor; (d) this Guaranty has been duly
executed by Guarantor; and (e) this Guaranty constitutes a valid and legally
binding obligation of Guarantor, enforceable against Guarantor in accordance
with its terms.

10. This Guaranty shall be governed by and construed in accordance with the laws
of the State of New York.

[SIGNATURE PAGE FOLLOWS]

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IN WITNESS WHEREOF, the Guarantor has executed this Guaranty on the date first
written above.

 

GUARANTOR:

ITT CORPORATION

By:  

  /s/ Steven Giuliano

    Name:   Steven Giuliano     Title:   VP and Chief Accounting Officer

 

Accepted:

SLMTI DS LLC

By:  

  /s/ Thomas H. Lemley

    Name:   Thomas H. Lemley     Title:   President