Exhibit 10.42

$50,000,000

THE HILLMAN GROUP, INC.

10.875% SENIOR NOTES DUE 2018

PURCHASE AGREEMENT

March 11, 2011

BARCLAYS CAPITAL INC.

MORGAN STANLEY & CO. INCORPORATED,

As Representatives of the several

Initial Purchasers named in Schedule I attached hereto,

c/o Barclays Capital Inc.

745 Seventh Avenue

New York, New York 10019

Ladies and Gentlemen:

The Hillman Group, Inc., a Delaware corporation (the “Company”), proposes, upon
the terms and conditions set forth in this agreement (this “Agreement”), to
issue and sell to you, as the initial purchasers (the “Initial Purchasers”),
$50,000,000 in aggregate principal amount of its 10.875% Senior Notes due 2018
(the “Notes”). The Notes will (i) have terms and provisions that are summarized
in the Offering Memorandum (as defined below), and (ii) are to be issued
pursuant to an Indenture, dated as of May 28, 2010, entered into among the
Company, the Guarantors (as defined below) and Wells Fargo Bank, National
Association, as trustee (the “Trustee”), as amended and supplemented by the
First Supplemental Indenture, dated as of December 29, 2010 (as so amended and
supplemented, the “Indenture”). The Company’s obligations under the Notes,
including the due and punctual payment of interest on the Notes, will be
irrevocably and unconditionally guaranteed on a senior unsecured basis (the
“Guarantees”) by The Hillman Companies, Inc. (“Hillman Companies”), Hillman
Investment Company (“Parent”) and the other guarantors listed in Schedule II
hereto (collectively, the “Guarantors”). As used herein, the term “Notes” shall
include the Guarantees, unless the context otherwise requires. This Agreement is
to confirm the agreement concerning the purchase of the Notes from the Company
by the Initial Purchasers.

The Company has previously issued $150,000,000 in aggregate principal amount of
its 10.875% Senior Notes due 2018 (the “Existing Notes”) under the Indenture.
The Notes constitute “Additional Notes” (as such term is defined in the
Indenture) under the Indenture. Except as otherwise disclosed in the Pricing
Disclosure Package and the Offering Memorandum, the Notes will have terms
identical to the Existing Notes and will be treated as a single series of debt
securities for all purposes under the Indenture.

 

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Pursuant to a Purchase Agreement, dated as of March 10, 2011 (the “Acquisition
Agreement”), by and between the Company, TagWorks, L.L.C., an Arizona limited
liability company (“TagWorks”), and the sellers named therein, the Company will
acquire TagWorks in exchange for initial cash consideration of approximately $40
million (the “Acquisition”). The Company expects to pay the initial cash
consideration of the Acquisition with cash proceeds from the issuance of $50
million aggregate principal amount of the Notes.

1. Purchase and Resale of the Notes. The Notes will be offered and sold to the
Initial Purchasers without registration under the Securities Act of 1933, as
amended (the “Securities Act”), in reliance on an exemption pursuant to
Section 4(2) under the Securities Act. The Company and the Guarantors have
prepared a preliminary offering memorandum, dated March 11, 2011 (the
“Preliminary Offering Memorandum”), a pricing term sheet substantially in the
form attached hereto as Schedule III (the “Pricing Term Sheet”) setting forth
the terms of the Notes omitted from the Preliminary Offering Memorandum and
certain other information and an offering memorandum, dated March 11, 2011 (the
“Offering Memorandum”), setting forth information regarding the Company, the
Guarantors, the Notes, and the Exchange Notes (as defined herein), the
Guarantees and the Exchange Guarantees (as defined herein). The Preliminary
Offering Memorandum, as supplemented and amended as of the Applicable Time (as
defined below), together with the Pricing Term Sheet and any of the documents
listed on Schedule IV(A) hereto are collectively referred to as the “Pricing
Disclosure Package”. The Company and the Guarantors hereby confirm that they
have authorized the use of the Pricing Disclosure Package and the Offering
Memorandum in connection with the offering and resale of the Notes by the
Initial Purchasers. “Applicable Time” means 3:15 p.m. (New York City time) on
the date of this Agreement.

Any reference to the Preliminary Offering Memorandum, the Pricing Disclosure
Package or the Offering Memorandum shall be deemed to refer to and include the
Hillman Companies’ most recent Annual Report on Form 10-K, as amended (the “Form
10-K”), and all subsequent documents filed with the United States Securities and
Exchange Commission (the “Commission”) pursuant to Section 13(a), 13(c) or 15(d)
of the United States Securities Exchange Act of 1934, as amended (the “Exchange
Act”), on or prior to the date of the Preliminary Offering Memorandum, the
Pricing Disclosure Package or the Offering Memorandum, as the case may be. Any
reference to the Preliminary Offering Memorandum, Pricing Disclosure Package or
the Offering Memorandum, as the case may be, as amended or supplemented, as of
any specified date, shall be deemed to include any documents filed with the
Commission pursuant to Section 13(a), 13(c) or 15(d) of the Exchange Act after
the date of the Preliminary Offering Memorandum, Pricing Disclosure Package or
the Offering Memorandum, as the case may be, and prior to such specified date.
All documents filed under the Exchange Act and so deemed to be included in the
Preliminary Offering Memorandum, Pricing Disclosure Package or the Offering
Memorandum, as the case may be, or any amendment or supplement thereto are
hereinafter called the “Exchange Act Reports”.

You have advised the Company that you will offer and resell (the “Exempt
Resales”) the Notes purchased by you hereunder in private sales exempt from
registration under the Securities Act on the terms set forth in each of the
Pricing Disclosure Package and the Offering Memorandum, as amended or
supplemented, solely to (i) persons whom you reasonably believe

 

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to be “qualified institutional buyers” as defined in Rule 144A under the
Securities Act (“QIBs”), in accordance with Rule 144A under the Securities Act,
and (ii) outside the United States to certain persons who are not U.S. Persons
(as defined in Regulation S under the Securities Act (“Regulation S”)) (such
persons, “Non-U.S. Persons”) in offshore transactions in reliance on Regulation
S. As used herein, the terms “offshore transaction” and “United States” have the
meanings assigned to them in Regulation S. Those persons specified in clauses
(i) and (ii) are referred to herein as “Eligible Purchasers”.

Holders (including subsequent transferees) of the Notes will have the
registration rights set forth in a registration rights agreement, substantially
in the form attached hereto as Exhibit A (the “Registration Rights Agreement”),
among the Company, the Guarantors and the Initial Purchasers to be dated the
Closing Date (as defined herein), for so long as such Notes constitute “Transfer
Restricted Securities” (as defined in the Registration Rights Agreement).
Pursuant to the Registration Rights Agreement, the Company and the Guarantors
will agree to file with the Securities and Exchange Commission (the
“Commission”) under the circumstances set forth therein, a registration
statement under the Securities Act relating to the Company’s 10.875% Senior
Notes due 2018 (the “Exchange Notes”) and the Guarantors’ Exchange Guarantees
(the “Exchange Guarantees”) to be offered in exchange for the Notes and the
Guarantees. Such portion of the offering is referred to as the “Exchange Offer”.

2. Representations, Warranties and Agreements of the Company and the Guarantors.
The Company and the Guarantors, jointly and severally, represent, warrant and
agree as follows:

(a) When the Notes and Guarantees are issued and delivered pursuant to this
Agreement, such Notes and Guarantees will not be of the same class (within the
meaning of Rule 144A under the Securities Act) as securities of the Company or
the Guarantors that are listed on a national securities exchange registered
under Section 6 of the Exchange Act or that are quoted in a United States
automated inter-dealer quotation system.

(b) Assuming the accuracy of your representations and warranties in
Section 3(b), and your compliance with your agreements set forth in this
Agreement, the purchase and resale of the Notes pursuant to and in the manner
contemplated by this Agreement, the Pricing Disclosure Package and the Offering
Memorandum (including pursuant to the Exempt Resales) are exempt from the
registration requirements of the Securities Act.

(c) No form of general solicitation or general advertising within the meaning of
Regulation D (including, but not limited to, advertisements, articles, notices
or other communications published in any newspaper, magazine or similar medium
or broadcast over television or radio, or any seminar or meeting whose attendees
have been invited by any general solicitation or general advertising) was used
by the Company, the Guarantors, any of their respective affiliates or any of
their respective representatives (other than you and your affiliates, as to whom
the Company and the Guarantors make no representation) in connection with the
offer and sale of the Notes.

 

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(d) No directed selling efforts within the meaning of Rule 902 under the
Securities Act were used by the Company, the Guarantors or any of their
respective representatives (other than you, as to whom the Company and the
Guarantors make no representation) with respect to Notes sold outside the United
States to Non-U.S. Persons, and the Company, any affiliate of the Company and
any person acting on its or their behalf (other than you and your affiliates, as
to whom the Company and the Guarantors make no representation) has complied with
and will implement the “offering restrictions” required by Rule 902 under the
Securities Act.

(e) Each of the Preliminary Offering Memorandum, the Pricing Disclosure Package
and the Offering Memorandum, each as of its respective date, contains or will
contain all the information specified in, and meet the requirements of, Rule
144A(d)(4) under the Securities Act.

(f) Neither the Company, any Guarantor nor any other person acting on behalf of
the Company or any Guarantor has sold or issued any securities that would be
integrated with the offering of the Notes contemplated by this Agreement
pursuant to the Securities Act, the rules and regulations thereunder or the
interpretations thereof by the Commission.

(g) The Preliminary Offering Memorandum, the Pricing Disclosure Package and the
Offering Memorandum have been prepared by the Company and the Guarantors for use
by the Initial Purchasers in connection with the Exempt Resales. No order or
decree preventing the use of the Preliminary Offering Memorandum, the Pricing
Disclosure Package or the Offering Memorandum, or any order asserting that the
transactions contemplated by this Agreement are subject to the registration
requirements of the Securities Act has been issued, and no proceeding for that
purpose has commenced or is pending or, to the knowledge of Company or any of
the Guarantors is contemplated.

(h) The Offering Memorandum will not, as of its date or as of the Closing Date,
contain an untrue statement of a material fact or omit to state a material fact
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading; provided that no representation or
warranty is made as to information contained in or omitted from the Offering
Memorandum in reliance upon and in conformity with written information furnished
to the Company through the Representatives by or on behalf of any Initial
Purchaser specifically for inclusion therein, which information is specified in
Section 8(e).

(i) The Pricing Disclosure Package did not, as of the Applicable Time, contain
an untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided that no
representation or warranty is made as to information contained in or omitted
from the Pricing Disclosure Package in reliance upon and in conformity with
written information furnished to the Company through the Representatives by or
on behalf of any Initial Purchaser specifically for inclusion therein, which
information is specified in Section 8(e).

 

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(j) The Company has not made any offer to sell or solicitation of an offer to
buy the Notes that would constitute a “free writing prospectus” (if the offering
of the Notes was made pursuant to a registered offering under the Securities
Act), as defined in Rule 405 under the Securities Act (a “Free Writing Offering
Document”), without the prior consent of the Representatives; any such Free
Writing Offering Document the use of which has been previously consented to by
the Initial Purchasers is listed on Schedule IV.

(k) The Pricing Disclosure Package, when taken together with each Free Writing
Offering Document listed in Schedule IV(B) hereto, did not, as of the Applicable
Time, contain an untrue statement of a material fact or omit to state a material
fact necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading; provided that no representation or
warranty is made as to information contained in or omitted from the Pricing
Disclosure Package (or Free Writing Offering Document listed in Schedule IV(B)
hereto) in reliance upon and in conformity with written information furnished to
the Company through the Representatives by or on behalf of any Initial Purchaser
specifically for inclusion therein, which information is specified in
Section 8(e).

(l) The Exchange Act Reports, when they were or are filed with the Commission,
conformed or will conform in all material respects to the applicable
requirements of the Exchange Act and the applicable rules and regulations of the
Commission thereunder. The Exchange Act Reports did not and will not, when filed
with the Commission, contain an untrue statement of material fact or omit to
state a material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading.

(m) Each of the Company, the Guarantors and their respective subsidiaries has
been duly organized, is validly existing and in good standing as a corporation
or other business entity under the laws of its jurisdiction of organization and
is duly qualified to do business and in good standing as a foreign corporation
or other business entity in each jurisdiction in which its ownership or lease of
property or the conduct of its businesses requires such qualification, except
where the failure to be so qualified or in good standing could not, in the
aggregate, reasonably be expected to have a material adverse effect on the
condition (financial or otherwise), results of operations, stockholders’ equity,
properties or business of the Company and its subsidiaries taken as a whole (a
“Material Adverse Effect”). Each of the Company, the Guarantors and their
respective subsidiaries has all power and authority necessary to own or hold its
properties and to conduct the businesses in which it is engaged. The Company
does not own or control, directly or indirectly, any corporation, association or
other entity other than the subsidiaries listed on Schedule V hereto. None of
the subsidiaries of the Company is a “significant subsidiary” (as defined in
Rule 405 under the Securities Act).

(n) Hillman Companies has an authorized capitalization as set forth in each of
the Pricing Disclosure Package and the Offering Memorandum. All of the issued
shares of capital stock of the Company have been duly authorized and validly
issued and are fully paid and non-assessable. All of the issued shares of
capital stock of each subsidiary of the Company have been duly authorized and
validly issued, are fully paid and non-assessable and are owned directly or
indirectly by the Company, free and clear of all liens, encumbrances, equities
or claims, except for such liens, encumbrances, equities or claims as could not,
in the aggregate, reasonably be expected to have a Material Adverse Effect.

 

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(o) The Company and each Guarantor has all requisite corporate power,
partnership or limited liability company and authority, as applicable, to
execute, deliver and perform its obligations under the Indenture. The Indenture
has been duly and validly authorized by the Company and the Guarantors, and,
assuming due authorization, execution and delivery by the Trustee, constitutes
the valid and binding agreement of the Company and the Guarantors, enforceable
against the Company and the Guarantors in accordance with its terms, except as
such enforceability may be limited by bankruptcy, fraudulent conveyance,
insolvency, reorganization, moratorium, and other laws now or hereafter in
effect relating to or affecting creditors’ rights generally and by general
equitable principles (regardless of whether such enforceability is considered in
a proceeding in equity or at law). The Indenture conforms in all material
respects to the description thereof in each of the Pricing Disclosure Package
and the Offering Memorandum.

(p) The Company has all requisite corporate power and authority to execute,
issue, sell and perform its obligations under the Notes. The Notes have been
duly authorized by the Company and, when duly executed by the Company in
accordance with the terms of the Indenture, assuming due authentication of the
Notes by the Trustee, upon delivery to the Initial Purchasers against payment
therefor in accordance with the terms hereof, will be validly issued and
delivered and will constitute valid and binding obligations of the Company
entitled to the benefits of the Indenture, enforceable against the Company in
accordance with their terms, except as such enforceability may be limited by
bankruptcy, fraudulent conveyance, insolvency, reorganization, moratorium, and
other laws now or hereafter in effect relating to or affecting creditors’ rights
generally and by general equitable principles (regardless of whether such
enforceability is considered in a proceeding in equity or at law). The Notes
will conform in all material respects to the description thereof in each of the
Pricing Disclosure Package and the Offering Memorandum.

(q) The Company has all requisite corporate power and authority to execute,
issue and perform its obligations under the Exchange Notes. The Exchange Notes
have been duly and validly authorized by the Company and if and when issued and
authenticated in accordance with the terms of the Indenture and delivered in
accordance with the Exchange Offer provided for in the Registration Rights
Agreement, will be validly issued and delivered and will constitute valid and
binding obligations of the Company entitled to the benefits of the Indenture,
enforceable against the Company in accordance with their terms, except as such
enforceability may be limited by bankruptcy, fraudulent conveyance, insolvency,
reorganization, moratorium, and other laws now or hereafter in effect relating
to or affecting creditors’ rights generally and by general equitable principles
(regardless of whether such enforceability is considered in a proceeding in
equity or at law).

(r) Each Guarantor has all requisite corporate, partnership or limited liability
company power and authority, as applicable, to execute, issue and perform its
obligations under the Guarantees. The Guarantees have been duly and validly
authorized by the Guarantors and in accordance with the terms of the Indenture
and upon the due execution, authentication and

 

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delivery of the Notes in accordance with the Indenture and the issuance of the
Notes in the sale to the Initial Purchasers contemplated by this Agreement, will
constitute valid and binding obligations of the Guarantors, enforceable against
the Guarantors in accordance with their terms, except as such enforceability may
be limited by bankruptcy, fraudulent conveyance, insolvency, reorganization,
moratorium, and other laws now or hereafter in effect relating to or affecting
creditors’ rights generally and by general equitable principles (regardless of
whether such enforceability is considered in a proceeding in equity or at law).
The Guarantees will conform in all material respects to the description thereof
in each of the Pricing Disclosure Package and the Offering Memorandum.

(s) Each Guarantor has all requisite corporate, partnership or limited liability
company power and authority, as applicable, to execute, issue and perform its
obligations under the Exchange Guarantees. The Exchange Guarantees have been
duly and validly authorized by the Guarantors and if and when executed and
delivered by the Guarantors in accordance with the terms of the Indenture and
upon the due execution and authentication of the Exchange Notes in accordance
with the Indenture and the issuance and delivery of the Exchange Notes in the
Exchange Offer contemplated by the Registration Rights Agreement, will be
validly issued and delivered and will constitute valid and binding obligations
of the Guarantors entitled to the benefits of the Indenture, enforceable against
the Guarantors in accordance with their terms, except as such enforceability may
be limited by bankruptcy, fraudulent conveyance, insolvency, reorganization,
moratorium, and other laws now or hereafter in effect relating to or affecting
creditors’ rights generally and by general equitable principles (regardless of
whether such enforceability is considered in a proceeding in equity or at law).

(t) The Company and each Guarantor has all requisite corporate, partnership or
limited liability company power and authority, as applicable, to execute,
deliver and perform its obligations under the Registration Rights Agreement. The
Registration Rights Agreement has been duly authorized by the Company and each
Guarantor and, when executed and delivered by the Company and each Guarantor on
the Closing Date in accordance with the terms hereof and thereof, will be
validly executed and delivered and (assuming the due authorization, execution
and delivery thereof by you) will be the legally valid and binding obligation of
the Company and each Guarantor in accordance with the terms thereof, enforceable
against the Company and each Guarantor in accordance with its terms, except as
such enforceability may be limited by bankruptcy, insolvency, reorganization,
moratorium and other similar laws now or hereafter in effect relating to or
affecting creditor’s rights generally, by general equitable principles
(regardless of whether such enforceability is considered in a proceeding in
equity or at law) and, as to rights of indemnification and contribution, by
principles of public policy. The Registration Rights Agreement will conform in
all material respects to the description thereof in each of the Pricing
Disclosure Package and the Offering Memorandum.

(u) The Company has all requisite corporate power and authority to consummate
the Acquisition and to enter into and perform its obligations under the
Acquisition Agreement.

 

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(v) The Acquisition Agreement has been duly and validly authorized, executed and
delivered by the Company and, assuming due authorization, execution and delivery
by the other parties thereto, constitute the valid and binding agreement of the
Company enforceable against the Company in accordance with its terms, except as
such enforceability may be limited by bankruptcy, fraudulent conveyance,
insolvency, reorganization, moratorium, and other laws now or hereafter in
effect relating to or affecting creditors’ rights generally and by general
equitable principles (regardless of whether enforcement is sought in a
proceeding in equity or at law).

(w) The Company and each Guarantor has all requisite corporate power to execute,
deliver and perform its obligations under this Agreement. This Agreement has
been duly and validly authorized, executed and delivered by the Company and each
of the Guarantors.

(x) Except as set forth in the Offering Memorandum, and assuming the accuracy
of, and the Initial Purchasers’ compliance with, the representations, warranties
and agreements of the Initial Purchasers set forth in Section 3 of this
Agreement, the issue and sale of the Notes and the Guarantees, the execution,
delivery and performance by the Company and the Guarantors of the Notes, the
Guarantees, the Exchange Notes, the Exchange Guarantees, the Indenture, the
Registration Rights Agreement, this Agreement and the Acquisition Agreement, the
application of the proceeds from the sale of the Notes as described under “Use
of Proceeds” in each of the Pricing Disclosure Package and the Offering
Memorandum and the consummation of the transactions contemplated hereby and
thereby, will not (i) conflict with or result in a breach or violation of any of
the terms or provisions of, impose any lien, charge or encumbrance upon any
property or assets of the Company, the Guarantors or their respective
subsidiaries, or constitute a default under, any indenture, mortgage, deed of
trust, loan agreement, license, lease or other agreement or instrument to which
the Company, the Guarantors or any of their respective subsidiaries is a party
or by which the Company, the Guarantors or any of their respective subsidiaries
is bound or to which any of the property or assets of the Company, the
Guarantors or any of their respective subsidiaries is subject, (ii) result in
any violation of the provisions of the charter or by-laws (or similar
organizational documents) of the Company, the Guarantors or any of their
respective subsidiaries, or (iii) result in any violation of any statute or any
judgment, order, decree, rule or regulation of any court or governmental agency
or body having jurisdiction over the Company, the Guarantors or any of their
respective subsidiaries or any of their properties or assets, except, with
respect to clauses (i) and (iii), breaches or defaults that would not reasonably
be expected to have a Material Adverse Effect.

(y) Assuming the accuracy of the representations and warranties of the Initial
Purchasers contained herein and the compliance by the Initial Purchasers with
their agreements contained herein, no consent, approval, authorization or order
of, or filing, registration or qualification with any court or governmental
agency or body having jurisdiction over the Company, the Guarantors or any of
their respective subsidiaries or any of their properties or assets is required
for the issue and sale of the Notes and the Guarantees, the execution, delivery
and performance by the Company and the Guarantors of the Notes, the Guarantees,
the Exchange Notes, the Exchange Guarantees, the Indenture, the Registration
Rights Agreement, this Agreement and the Acquisition Agreement, the application
of the proceeds from the sale of the Notes as described under “Use of Proceeds”
in each of the Pricing Disclosure Package and the Offering Memorandum and the
consummation of the transactions contemplated hereby and thereby, except
(i) such as have been or will be obtained or made on or prior to the Closing
Date,

 

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(ii) for the filing of a registration statement by the Company with the
Commission pursuant to the Securities Act as required by the Registration Rights
Agreement in connection with the issuance of the Exchange Notes and the Exchange
Guarantees, (iii) such consents, approvals, authorizations, orders, filings,
registrations or qualifications as may be required under state securities or
Blue Sky laws in connection with the purchase and distribution of the Notes by
the Initial Purchasers, each of which had been obtained and is in full force and
effect and (iv) where the failure to obtain such consents, approvals,
authorizations or orders of, filings, registrations or qualifications could not,
in the aggregate, reasonably be expected to have a Material Adverse Effect.

(z) The historical financial statements (including the related notes and
supporting schedules) included or incorporated by reference in the Pricing
Disclosure Package and the Offering Memorandum present fairly in all material
respects the financial condition, results of operations and cash flows of the
entities purported to be shown thereby, at the dates and for the periods
indicated, and have been prepared in conformity with accounting principles
generally accepted in the United States applied on a consistent basis throughout
the periods involved (except as disclosed therein).

(aa) The unaudited pro forma financial information and related notes thereto
included in the Pricing Disclosure Package and the Offering Memorandum has been
prepared in accordance with the Commission’s rules and guidance with respect to
pro forma financial information, and the assumptions underlying such pro forma
financial information are reasonable and are set forth in each of the Pricing
Disclosure Package and the Offering Memorandum.

(bb) Grant Thornton LLP, who have certified certain financial statements of the
Company, whose report is incorporated by reference in the Pricing Disclosure
Package and the Offering Memorandum and who have delivered the Grant Thornton
initial letter referred to in Section 7(f) hereof, are independent registered
public accountants as required by the Securities Act and the rules and
regulations thereunder.

(cc) KPMG LLP, who have certified certain financial statements of the Company,
and who have delivered the KPMG initial letter referred to in Section 7(h)
hereof, are independent registered public accountants as required by the
Securities Act and the rules and regulations thereunder.

(dd) Except as otherwise disclosed in the Pricing Disclosure Package and the
Offering Memorandum, the Company and the Guarantors maintain a system of
internal control over financial reporting (as such term is defined in Rule
13a-15(f) of the Exchange Act) that complies in all material respects with the
requirements of the Exchange Act and that has been designed by, or under the
supervision of, the Company’s and each Guarantors’ respective principal
executive and principal financial officers, to provide reasonable assurance
regarding the reliability of financial reporting and the preparation of
financial statements for external purposes in accordance with generally accepted
accounting principles in the United States. Except as otherwise disclosed in or
contemplated by the Pricing Disclosure Package and the Offering Memorandum, the
Company and the Guarantors maintain internal accounting controls sufficient to
provide reasonable assurance that (i) transactions are executed in accordance
with

 

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management’s general or specific authorization, (ii) transactions are recorded
as necessary to permit preparation of financial statements in conformity with
accounting principles generally accepted in the United States and to maintain
accountability for its assets, (iii) access to assets is permitted only in
accordance with management’s general or specific authorization, and (iv) the
recorded accountability for assets is compared with existing assets at
reasonable intervals and appropriate action is taken with respect to any
differences. As of the date of the most recent balance sheet of Hillman
Companies and its consolidated subsidiaries reviewed or audited by KPMG LLP and
the audit committee of the board of directors of Hillman Companies, except as
otherwise disclosed in or contemplated by the Pricing Disclosure Package and the
Offering Memorandum, there were no material weaknesses in Hillman Companies’
internal controls.

(ee) Except as otherwise disclosed in or contemplated by the Pricing Disclosure
Package and the Offering Memorandum, (i) the Company and the Guarantors maintain
disclosure controls and procedures (as such term is defined in Rule 13a-15(e)
under the Exchange Act), (ii) such disclosure controls and procedures are
designed to ensure that the information required to be disclosed by Hillman
Companies in the reports it files or submits under the Exchange Act is
accumulated and communicated to management of Hillman Companies, including its
principal executive officer and principal financial officer, to allow timely
decisions regarding required disclosure to be made; and (iii) such disclosure
controls and procedures are effective in all material respects to perform the
functions for which they were established.

(ff) Except as would not have a Material Adverse Effect, the section entitled
“Management’s Discussion and Analysis of Financial Condition and Results of
Operations – Critical Accounting Policies” set forth or incorporated by
reference in the Preliminary Offering Memorandum contained in the Pricing
Disclosure Package and the Offering Memorandum accurately and fully describes
(i) the accounting policies that Hillman Companies believes are the most
important in the portrayal of Hillman Companies’ financial condition and results
of operations and that require management’s most difficult, subjective or
complex judgments; (ii) the judgments and uncertainties affecting the
application of critical accounting policies; and (iii) the likelihood that
materially different amounts would be reported under different conditions or
using different assumptions and an explanation thereof.

(gg) With respect to each of the items of financial data regarding the fiscal
year ended December 31, 2010 included in the Preliminary Offering Memorandum
under the caption “Summary - Preliminary Financial Data and Recent Developments”
(the “Preliminary Results”), the Chief Financial Officer of the Company or
members of the staff who are responsible for the Company’s financial and
accounting matters derived the amounts with respect to the fiscal-year ended
December 31, 2010 referenced in the Preliminary Results from the accounting
records of the Company and the accounting records of TagWorks provided to the
Company, and found the amounts to be within the ranges set forth in the
Preliminary Offering Memorandum.

(hh) With respect to the Preliminary Results, nothing has come to the attention
of the Company that causes the Company to believe that the financial information
contained in the Preliminary Results is not true, correct and accurate in all
material respects.

 

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(ii) There is and has been no failure on the part of Hillman Companies and any
of Hillman Companies’ directors or officers, in their capacities as such, to
comply with any provision of the Sarbanes-Oxley Act of 2002 and the rules and
regulations promulgated in connection therewith.

(jj) Since the date of the latest audited financial statements included in the
Pricing Disclosure Package and the Offering Memorandum, and except as otherwise
disclosed in the Offering Memorandum, neither the Company, the Guarantors nor
any of their respective subsidiaries has (i) sustained any loss or interference
with its business from fire, explosion, flood or other calamity, whether or not
covered by insurance, or from any labor disturbance or dispute or court or
governmental action, order or decree, (ii) issued or granted any securities,
(iii) incurred any material liability or obligation, direct or contingent, other
than liabilities and obligations that were incurred in the ordinary course of
business, (iv) entered into any material transaction not in the ordinary course
of business, (v) declared or paid any dividend on its capital stock, and
(vi) since such date, there has not been any change in the capital stock,
partnership or limited liability interests as applicable, or long-term debt of
the Company, the Guarantors or any of their respective subsidiaries or any
adverse change, or any development involving a prospective adverse change, in or
affecting the condition (financial or otherwise), results of operations,
stockholders’ equity, properties, management or business of the Company and its
subsidiaries, taken as a whole, in each case except as could not, in the
aggregate, reasonably be expected to have a Material Adverse Effect.

(kk) Except as would not have a Material Adverse Effect, the Company, the
Guarantors and each of their respective subsidiaries has good and marketable
title in fee simple to all real property and good and marketable title to all
personal property owned by them, in each case free and clear of all liens,
encumbrances and defects, except such liens, encumbrances and defects as are
described in the Pricing Disclosure Package and the Offering Memorandum and such
as do not materially affect the value of such property and do not materially
interfere with the use made and proposed to be made of such property by the
Company, the Guarantors or any of their respective subsidiaries are held by them
under valid, subsisting and enforceable leases, with such exceptions as do not
materially interfere with the use made and proposed to be made of such assets by
the Company, the Guarantors or any of their respective subsidiaries.

(ll) The Company and each of its subsidiaries have such permits, licenses,
patents, franchises, certificates of need and other approvals or authorizations
of governmental or regulatory authorities (“Permits”) as are necessary under
applicable law to own their properties and conduct their businesses in the
manner described in the Pricing Disclosure Package and the Offering Memorandum,
except for any of the foregoing that could not, in the aggregate, reasonably be
expected to have a Material Adverse Effect. Hillman Companies and each of its
subsidiaries have fulfilled and performed all of its obligations with respect to
the Permits, and no event has occurred that allows, or after notice or lapse of
time would allow, revocation or termination thereof or results in any other
impairment of the rights of the holder or any such Permits, except for any of
the foregoing that could not reasonably be expected to have a Material Adverse
Effect. Neither the Company, nor any of its subsidiaries has received notice of
any revocation or modification of any such Permits, except for any notice that
could not reasonably be expected to have a Material Adverse Effect.

 

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(mm) Except as could not reasonably be expected to have a Material Adverse
Effect, the Company and the Guarantors own or possess adequate rights to use all
material patents, patent applications, trademarks, service marks, trade names,
trademark registrations, service mark registrations, copyrights, licenses,
know-how, software, systems and technology (including trade secrets and other
unpatented and/or unpatentable proprietary or confidential information, systems
or procedures) necessary for the conduct of their respective businesses and have
not received any notice of any claim of infringement or other violation of, any
such rights of others.

(nn) Except as otherwise disclosed in the Offering Memorandum, there are no
legal or governmental proceedings pending to which the Company or any of its
subsidiaries is a party or of which any property or assets of the Company or any
of its subsidiaries is the subject that could, in the aggregate, reasonably be
expected to have a Material Adverse Effect or could, in the aggregate,
reasonably be expected to have a material adverse effect on the performance by
the Company and the Guarantors of the performance of this Agreement, the
Indenture, the Notes, the Guarantees or the consummation of any of the
transactions contemplated hereby. To the Company’s and each Guarantors’
knowledge, no such proceedings are threatened or contemplated by governmental
authorities or others.

(oo) There are no contracts or other documents that would be required to be
described in a registration statement filed under the Securities Act or filed as
exhibits to a registration statement of the Company pursuant to Item 601(10) of
Regulation S-K that have not been described in the Pricing Disclosure Package
and the Offering Memorandum. The statements made in the Pricing Disclosure
Package and the Offering Memorandum, insofar as they purport to constitute
summaries of the terms of the contracts and other documents that are so
described, constitute accurate summaries of the terms of such contracts and
documents in all material respects. Neither the Company, the Guarantors nor any
of their respective subsidiaries has knowledge that any other party to any such
contract or other document has any intention not to render full performance as
contemplated by the terms thereof.

(pp) The Company and each Guarantor carries, or are covered by, insurance from
insurers of recognized financial responsibility in such amounts and covering
such risks as is adequate for the conduct of their respective businesses and the
value of their respective properties and as is customary for companies engaged
in similar businesses in similar industries, except where the failure to
maintain such insurance could not, individually or in the aggregate, have a
Material Adverse Effect. The Company and the Guarantors are in compliance with
the terms of such policies, neither the Company nor any Guarantor has received
notice from any insurer or agent of such insurer that capital improvements or
other expenditures are required or necessary to be made in order to continue
such insurance, there are no claims by the Company or the Guarantors under any
such policy or instrument as to which any insurance company is denying liability
or defending under a reservation of rights clause, and neither the Company nor
any Guarantor has any reason to believe that it will not be able to renew its
existing insurance coverage as and when such coverage expires or to obtain
similar coverage from similar insurers as may be necessary to continue its
business, in each case other than as could not reasonably be expected to have a
Material Adverse Effect.

 

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(qq) No labor disturbance by or dispute with the employees of the Company or any
of its subsidiaries exists or, to the knowledge of any officer of the Company or
any Guarantor is imminent that could reasonably be expected to have a Material
Adverse Effect.

(rr) Neither the Company nor any of the Guarantors (i) is in violation of its
charter or by-laws (or similar organizational documents), (ii) is in default,
and no event has occurred that, with notice or lapse of time or both, would
constitute such a default, in the due performance or observance of any term,
covenant, condition or other obligation contained in any indenture, mortgage,
deed of trust, loan agreement, license or other agreement or instrument to which
it is a party or by which it is bound or to which any of its properties or
assets is subject, or (iii) is in violation of any statute or any order, rule or
regulation of any court or governmental agency or body having jurisdiction over
it or its property or assets or has failed to obtain any license, permit,
certificate, franchise or other governmental authorization or permit necessary
to the ownership of its property or to the conduct of its business, except in
the case of clauses (ii) and (iii), to the extent any such conflict, breach,
violation, failure or default could not, in the aggregate, reasonably be
expected to have a Material Adverse Effect.

(ss) (i) There are no proceedings that are pending, or known to be threatened,
against the Company or any of its subsidiaries under any laws, regulations,
ordinances, rules, orders, judgments, decrees, permits or other legal
requirements of any governmental authority, including without limitation any
international, foreign, national, state, provincial, regional, or local
authority, relating to pollution, the protection of human health or safety, the
environment, or natural resources, or to use, handling, storage, manufacturing,
transportation, treatment, discharge, disposal or release of or exposure to
hazardous or toxic substances or wastes, pollutants or contaminants
(“Environmental Laws”) in which a governmental authority is also a party, other
than such proceedings regarding which it is reasonably believed no monetary
sanctions of $100,000 or more will be imposed and (ii) the Company, the
Guarantors and their respective subsidiaries are not aware of any issues
regarding compliance with Environmental Laws, including any pending or proposed
Environmental Laws, or liabilities or other obligations under Environmental Laws
or concerning hazardous or toxic substances or wastes, pollutants or
contaminants, that could reasonably be expected to have a Material Adverse
Effect.

(tt) The Company, the Guarantors and each of their respective subsidiaries have
filed all federal, state, local and foreign tax returns required to be filed
through the date hereof, subject to permitted extensions, and have paid all
taxes due, and no tax deficiency has been determined adversely to the Company,
the Guarantors or any of their respective subsidiaries. Neither the Company nor
any Guarantor has any knowledge of any tax deficiencies that have been, or could
reasonably be expected to be asserted against the Company, the Guarantors and
each of their respective subsidiaries, that could, in the aggregate, reasonably
be expected to have a Material Adverse Effect.

(uu) (i) Each “employee benefit plan” (within the meaning of Section 3(3) of the
Employee Retirement Security Act of 1974, as amended (“ERISA”)) that is
sponsored or maintained within the United States and with respect to which the
Company has any direct or indirect liability, whether contingent or otherwise
(each a “Plan”) has been established and administered in all material respects
in compliance with its terms and with the requirements of

 

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all applicable statutes, rules and regulations including ERISA and the Code;
(ii) with respect to each Plan, no prohibited transaction, within the meaning of
Section 406 of ERISA or Section 4975 of the Code, has occurred with respect to
any Plan excluding transactions effected pursuant to a statutory or
administrative exemption or that have been corrected, that would result in a
material liability to the Company ; (iii) no Plan is subject to Title IV of
ERISA; and (iv) each Plan that is intended to be qualified under Section 401(a)
of the Code has received a favorable determination letter from the Internal
Revenue Service or is in the form of a prototype plan with respect to which the
IRS has issued a favorable opinion letter, in each case to the effect that the
Plan satisfies the requirements of Section 401(a) of the Code and that its
related trust is exempt from tax under Section 501(a) of the Code and nothing
has occurred, whether by action or by failure to act, which would be reasonably
be expected to cause the loss of such qualification.

(vv) No subsidiary of the Company is currently prohibited, directly or
indirectly, from paying any dividends to the Company, from making any other
distribution on such subsidiary’s capital stock, from repaying to the Company
any loans or advances to such subsidiary from the Company or from transferring
any of such subsidiary’s property or assets to the Company or any other
subsidiary of the Company, except as described in the Pricing Disclosure Package
and the Offering Memorandum and as could not be reasonably expected to impact
the ability of the Company or the Guarantors to make payments on the Notes when
due.

(ww) The statistical and market-related data included in the Pricing Disclosure
Package and the Offering Memorandum and the consolidated financial statements of
the Company and its subsidiaries included in the Pricing Disclosure Package and
the Offering Memorandum are based on or derived from sources that the Company
believes to be reliable in all material respects.

(xx) Neither of the Company nor any Guarantor is, and after giving effect to the
offer and sale of the Notes and the application of the proceeds therefrom as
described under “Use of Proceeds” in each of the Pricing Disclosure Package and
the Offering Memorandum will be an “investment company” or a company “controlled
by an “investment company” within the meaning of the Investment Company Act of
1940, as amended, and the rules and regulations of the Commission thereunder.

(yy) The statements set forth in each of the Pricing Disclosure Package and the
Offering Memorandum under the caption “Description of Notes,” insofar as they
purport to constitute a summary of the terms of the Notes and the Guarantees and
under the captions “Certain United States Federal Income Tax Considerations,”
“The Transactions,” “Description of Certain Other Indebtedness,” “Management”
and “Plan of Distribution,” insofar as they purport to summarize the provisions
of the laws and documents referred to therein, are accurate summaries in all
material respects.

(zz) Except as described in the Offering Memorandum, there are no contracts,
agreements or understandings between the Company, any Guarantor and any person
granting such person the right to require the Company or any Guarantor to file a
registration statement under the Securities Act with respect to any securities
of the Company or any Guarantor (other than the Registration Rights Agreement)
owned or to be owned by such person or to require the

 

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Company or any Guarantor to include such securities in the securities registered
pursuant to the Registration Rights Agreement or in any securities being
registered pursuant to any other registration statement filed by the Company or
any Guarantor under the Securities Act.

(aaa) Neither the Company nor any of its subsidiaries is a party to any
contract, agreement or understanding with any person (other than this Agreement)
that could give rise to a valid claim against any of them or the Initial
Purchasers for a brokerage commission, finder’s fee or like payment in
connection with the offering and sale of the Notes.

(bbb) Except as would not have a Material Adverse Effect, none of the
transactions contemplated by this Agreement (including, without limitation, the
use of the proceeds from the sale of the Notes), will violate or result in a
violation of Section 7 of the Exchange Act, or any regulation promulgated
thereunder, including, without limitation, Regulations T, U and X of the Board
of Governors of the Federal Reserve System

(ccc) The Company and its affiliates have not taken, directly or indirectly, any
action designed to or that has constituted or that could reasonably be expected
to cause or result in the stabilization or manipulation of the price of any
security of the Company or the Guarantors in connection with the offering of the
Notes.

(ddd) Neither the Company nor any of its subsidiaries, nor, to the knowledge of
the Company and the Guarantors, any director, officer, agent, employee or other
person associated with or acting on behalf of the Company, the Guarantors or any
of their respective subsidiaries, has (i) used any corporate funds for any
unlawful contribution, gift, entertainment or other unlawful expense relating to
political activity; (ii) made any direct or indirect unlawful payment to any
foreign or domestic government official or employee from corporate funds;
(iii) violated or is in violation of any provision of the Foreign Corrupt
Practices Act of 1977; or (iv) made any bribe, rebate, payoff, influence
payment, kickback or other unlawful payment.

(eee) The operations of the Company and its subsidiaries are and have been
conducted at all times in compliance with applicable financial recordkeeping and
reporting requirements of the Currency and Foreign Transactions Reporting Act of
1970, as amended, the money laundering statutes of all jurisdictions, the rules
and regulations thereunder and any related or similar rules, regulations or
guidelines, issued, administered or enforced by any governmental agency
(collectively, the “Money Laundering Laws”) and no action, suit or proceeding by
or before any court or governmental agency, authority or body or any arbitrator
involving the Company or any of its subsidiaries with respect to the Money
Laundering Laws is pending or, to the knowledge of the Company, threatened.

(fff) Neither the Company nor any of its subsidiaries nor, to the knowledge of
the Company, any director, officer, agent, employee or affiliate of the Company
or any of its subsidiaries is currently subject to any U.S. sanctions
administered by the Office of Foreign Assets Control of the U.S. Treasury
Department (“OFAC”); and the Company will not directly or indirectly use the
proceeds of the offering, or lend, contribute or otherwise make available such
proceeds to any subsidiary, joint venture partner or other person or entity, for
the purpose of financing the activities of any person currently subject to any
U.S. sanctions administered by OFAC.

 

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Any certificate signed by any officer of the Company or the Guarantors and
delivered to the Representatives or counsel for the Initial Purchasers in
connection with the offering of the Notes shall be deemed a representation and
warranty by the Company or such Guarantor, jointly and severally, as to matters
covered thereby, to each Initial Purchaser.

3. Purchase of the Notes by the Initial Purchasers, Agreements to Sell, Purchase
and Resell.

(a) The Company and the Guarantors, jointly and severally hereby agree, on the
basis of the representations, warranties, covenants and agreements of the
Initial Purchasers contained herein and subject to all the terms and conditions
set forth herein, to issue and sell to the Initial Purchasers and, upon the
basis of the representations, warranties and agreements of the Company and the
Guarantors herein contained and subject to all the terms and conditions set
forth herein, each of the Initial Purchasers agree, severally and not jointly,
to purchase from the Company, at a purchase price of 107.500% of the principal
amount thereof, the total principal amount of Notes set forth opposite the name
of such Initial Purchaser in Schedule I hereto. The Company and the Guarantors
shall not be obligated to deliver any of the securities to be delivered
hereunder except upon payment for all of the securities to be purchased as
provided herein.

(b) Each of the Initial Purchasers, severally and not jointly hereby represents
and warrants to the Company that it will offer the Notes for sale upon the terms
and conditions set forth in this Agreement and in the Pricing Disclosure
Package. Each of the Initial Purchasers, severally and not jointly, hereby
represents and warrants to, and agrees with, the Company, on the basis of the
representations, warranties and agreements of the Company and the Guarantors,
that such Initial Purchaser: (i) is a QIB with such knowledge and experience in
financial and business matters as are necessary in order to evaluate the merits
and risks of an investment in the Notes; (ii) is purchasing the Notes pursuant
to a private sale exempt from registration under the Securities Act; (iii) in
connection with the Exempt Resales, will solicit offers to buy the Notes only
from, and will offer to sell the Notes only to, the Eligible Purchasers in
accordance with this Agreement and on the terms contemplated by the Pricing
Disclosure Package; (iv) will not offer or sell the Notes, nor has it offered or
sold the Notes by, or otherwise engaged in, any form of general solicitation or
general advertising (within the meaning of Regulation D, including, but not
limited to, advertisements, articles, notices or other communications published
in any newspaper, magazine, or similar medium or broadcast over television or
radio, or any seminar or meeting whose attendees have been invited by any
general solicitation or general advertising) and will not engage in any directed
selling efforts within the meaning of Rule 902 under the Securities Act, in
connection with the offering of the Notes; and (v) has offered the Notes and
will offer and sell the Notes (A) as part of its distribution at any time and
(B) otherwise until 40 days after the later of the commencement of the offering
and the Closing Date, only in accordance with Rule 903 of Regulation S and,
accordingly, neither it nor any persons acting on its behalf have engaged or
will engage in any directed selling efforts (within the meaning of Regulation S)
with respect to the Securities, and any such persons have complied and will

 

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comply with the offering restrictions requirement of Regulation S. The Initial
Purchasers have advised the Company that they will offer the Notes to Eligible
Purchasers at a price initially equal to 109.250% of the principal amount
thereof, plus accrued interest, if any, from the date of issuance of the Notes.
Such price may be changed by the Initial Purchasers at any time without notice.

(c) The Initial Purchasers have not nor, prior to the later to occur of (A) the
Closing Date and (B) completion of the distribution of the Notes, will not, use,
authorize use of, refer to or distribute any material in connection with the
offering and sale of the Notes other than (i) the Preliminary Offering
Memorandum, the Pricing Disclosure Package, the Offering Memorandum, (ii) any
written communication that contains no “issuer information” (as defined in Rule
433(h)(2) under the Act) that was not included (including through incorporation
by reference) in the Preliminary Offering Memorandum or any Free Writing
Offering Document listed on Schedule IV hereto, (iii) the Free Writing Offering
Documents listed on Schedule IV hereto, (iv) any written communication prepared
by such Initial Purchaser and approved by the Company in writing, or (v) any
written communication that contains the terms of the Notes in the Preliminary
Offering Memorandum, the Pricing Disclosure Package or the Offering Memorandum.

(d) Each of the Initial Purchasers hereby acknowledges that upon original
issuance thereof, and until such time as the same is no longer required under
the applicable requirements of the Securities Act, the Notes (and all securities
issued in exchange therefore or in substitution thereof) shall bear legends
substantially in the forms as set forth in the “Notice to Investors” section of
the Pricing Disclosure Package and Offering Memorandum (along with such other
legends as the Company and its counsel deem necessary).

Each of the Initial Purchasers understands that the Company and, for purposes of
the opinions to be delivered to the Initial Purchasers pursuant to Sections
7(c), 7(d) and 7(e) hereof, counsel to the Company and counsel to the Initial
Purchasers, will rely upon the accuracy and truth of the foregoing
representations, warranties and agreements, and the Initial Purchasers hereby
consent to such reliance.

4. Delivery of the Notes and Payment Therefor. Delivery to the Initial
Purchasers of and payment for the Notes shall be made at the New York offices of
Latham & Watkins LLP, at 10:00 A.M., New York City time, on March 16, 2011 (the
“Closing Date”). The place of closing for the Notes and the Closing Date may be
varied by agreement between the Initial Purchasers and the Company.

The Notes will be delivered to the Initial Purchasers, or the Trustee as
custodian for The Depository Trust Company (“DTC”), against payment by or on
behalf of the Initial Purchasers of the purchase price therefor by wire transfer
in immediately available funds, by causing DTC to credit the Notes to the
account of the Initial Purchasers at DTC. The Notes will be evidenced by one or
more global securities in definitive form and will be registered in the name of
Cede & Co. as nominee of DTC. The Notes to be delivered to the Initial
Purchasers shall be made available to the Initial Purchasers in New York City
for inspection and packaging not later than 10:00 A.M., New York City time, on
the business day next preceding the Closing Date.

 

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5. Agreements of the Company and the Guarantors. The Company and the Guarantors,
jointly and severally, agree with each of the Initial Purchasers as follows:

(a) The Company and the Guarantors furnish to the Initial Purchasers, without
charge, not later than the second business day following the date of the
Offering Memorandum, such number of copies of the Offering Memorandum as may
then be amended or supplemented as they may reasonably request.

(b) The Company and the Guarantors will prepare the Offering Memorandum in a
form approved by the Initial Purchasers and will not make any amendment or
supplement to the Pricing Disclosure Package or to the Offering Memorandum of
which the Initial Purchasers shall not previously have been advised or to which
they shall reasonably object in a timely manner after being so advised.

(c) Subject to the proviso in Section 5(f), the Company and each of the
Guarantors consents to the use of the Pricing Disclosure Package and the
Offering Memorandum in accordance with the securities or Blue Sky laws of the
jurisdictions in which the Notes are offered by the Initial Purchasers and by
all dealers to whom Notes may be sold, in connection with the offering and sale
of the Notes.

(d) If, at any time prior to completion of the distribution of the Notes by the
Initial Purchasers to Eligible Purchasers, any event occurs or information
becomes known that, in the judgment of the Company or any of the Guarantors or
in the reasonable opinion of counsel for the Initial Purchasers, should be set
forth in the Pricing Disclosure Package or the Offering Memorandum so that the
Pricing Disclosure Package or the Offering Memorandum, as then amended or
supplemented, does not include any untrue statement of material fact or omit to
state a material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading, or if it
is necessary to supplement or amend the Pricing Disclosure Package or the
Offering Memorandum in order to comply with any law, the Company and the
Guarantors will forthwith prepare an appropriate supplement or amendment
thereto, and will expeditiously furnish to the Initial Purchasers and dealers a
reasonable number of copies thereof.

(e) None of the Company nor any Guarantor will make any offer to sell or
solicitation of an offer to buy the Notes that would constitute a Free Writing
Offering Document without the prior consent of the Representatives, which
consent shall not be unreasonably withheld or delayed. If at any time following
issuance of a Free Writing Offering Document any event occurred or occurs as a
result of which such Free Writing Offering Document conflicts with the
information in the Preliminary Offering Memorandum, the Pricing Disclosure
Package or the Offering Memorandum or, when taken together with the information
in the Preliminary Offering Memorandum, the Pricing Disclosure Package or the
Offering Memorandum, includes an untrue statement of a material fact or omits to
state any material fact necessary in order to make the statements therein, in
the light of the circumstances then prevailing, not misleading, as

 

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promptly as practicable after becoming aware thereof, the Company will give
notice thereof to the Initial Purchasers through the Representatives and, if
requested by the Representatives, will prepare and furnish without charge to
each Initial Purchaser a Free Writing Offering Document or other document which
will correct such conflict, statement or omission.

(f) Promptly from time to time to take such action as the Initial Purchasers may
reasonably request to qualify the Notes for offering and sale under the
securities or Blue Sky laws of such jurisdictions as the Initial Purchasers may
request and to comply with such laws so as to permit the continuance of sales
and dealings therein in such jurisdictions for as long as may be necessary to
complete the distribution of the Notes; provided that in connection therewith
the Company shall not be required to (i) qualify as a foreign corporation in any
jurisdiction in which it would not otherwise be required to so qualify,
(ii) file a general consent to service of process in any such jurisdiction, or
(iii) subject itself to taxation in any jurisdiction in which it would not
otherwise be subject.

(g) For a period commencing on the date hereof and ending on the 90th day after
the date of the Offering Memorandum, the Company and the Guarantors agree not
to, directly or indirectly, (i) offer for sale, sell, or otherwise dispose of
(or enter into any transaction or device that is designed to, or would be
expected to, result in the disposition by any person at any time in the future
of) any debt securities of the Company substantially similar to the Notes or
securities convertible into or exchangeable for such debt securities of the
Company, or sell or grant options, rights or warrants with respect to such debt
securities of the Company or securities convertible into or exchangeable for
such debt securities of the Company, (ii) enter into any swap or other
derivatives transaction that transfers to another, in whole or in part, any of
the economic benefits or risks of ownership of such debt securities of the
Company, whether any such transaction described in clause (i) or (ii) above is
to be settled by delivery of debt securities of the Company or other securities,
in cash or otherwise, (iii) file or cause to be filed a registration statement,
including any amendments, with respect to the registration of debt securities of
the Company substantially similar to the Notes or securities convertible,
exercisable or exchangeable into debt securities of the Company, or
(iv) publicly announce an offering of any debt securities of the Company
substantially similar to the Notes or securities convertible or exchangeable
into such debt securities, in each case without the prior written consent of
Barclays Capital Inc., on behalf of the Initial Purchasers, except any offer or
sale of Notes, Exchange Notes, Guarantees or Exchange Guarantees pursuant to the
Registration Rights Agreement, and any filings with the SEC related thereto.

(h) So long as any of the Notes are outstanding and the Company and the
Guarantors are so required pursuant to the Indenture, the Company and the
Guarantors will, furnish at their expense to the Initial Purchasers, and, upon
request, to the holders of the Notes and prospective purchasers of the Notes the
information required by Rule 144A(d)(4) under the Securities Act (if any).

(i) The Company and the Guarantors will apply the net proceeds from the sale of
the Notes to be sold by it hereunder substantially in accordance with the
description set forth in the Pricing Disclosure Package and the Offering
Memorandum under the caption “Use of Proceeds.”

 

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(j) The Company, the Guarantors and their respective affiliates will not take,
directly or indirectly, any action designed to or that has constituted or that
reasonably could be expected to cause or result in the stabilization or
manipulation of the price of any security of the Company or the Guarantors in
connection with the offering of the Notes.

(k) The Company and the Guarantors will use all commercially reasonable efforts
to permit the Notes to be eligible for clearance and settlement through DTC.

(l) For a period of one year (calculated in accordance with paragraph (d) of
Rule 144 under the Securities Act) from the Closing Date, the Company and the
Guarantors will not, and will not permit any of their respective affiliates (as
defined in Rule 144 under the Securities Act) to, resell any of the Notes that
have been acquired by any of them, except (i) for Notes that are sold in a
transaction registered under the Securities Act or (ii) in the opinion of
counsel, the buyer of such Notes is not acquiring “restricted securities” under
Rule 144 under the Securities Act.

(m) The Company and the Guarantors agree not to sell, offer for sale or solicit
offers to buy or otherwise negotiate in respect of any security (as defined in
the Securities Act) that would be integrated with the sale of the Notes in a
manner that would require the registration under the Securities Act of the sale
to the Initial Purchasers or the Eligible Purchasers of the Notes. The Company
and the Guarantors will take reasonable precautions designed to insure that any
offer or sale, direct or indirect, in the United States or to any U.S. person
(as defined in Rule 902 under the Securities Act), of any Notes or any
substantially similar security issued by the Company or any Guarantor, within
six months subsequent to the date on which the distribution of the Notes has
been completed (as notified to the Company by the Initial Purchasers), is made
under restrictions and other circumstances reasonably designed not to affect the
status of the offer and sale of the Notes in the United States and to U.S.
persons contemplated by this Agreement as transactions exempt from the
registration provisions of the Securities Act, including any sales pursuant to
Rule 144A under, or Regulations D or S of, the Securities Act.

(n) The Company and the Guarantors agree to comply with all the terms and
conditions of the Registration Rights Agreement and all agreements set forth in
the representation letters of the Company and the Guarantors to DTC relating to
the approval of the Notes by DTC for “book entry” transfer.

(o) The Company and the Guarantors will do and perform all things required or
necessary to be done and performed under this Agreement by them prior to the
Closing Date, and to satisfy all conditions precedent to the Initial Purchasers’
obligations hereunder to purchase the Notes.

6. Expenses. Whether or not the transactions contemplated by this Agreement are
consummated or this Agreement is terminated, the Company and the Guarantors,
jointly and severally, agree to pay all expenses, costs, fees and taxes incident
to and in connection with: (a) the preparation, printing, filing and
distribution of the Preliminary Offering Memorandum, the Pricing Disclosure
Package and the Offering Memorandum (including, without limitation, financial
statements and exhibits) and all amendments and supplements thereto (including
the

 

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fees, disbursements and expenses of the Company’s and the Guarantors’
accountants and counsel, but not, however, legal fees and expenses of the
Initial Purchasers’ counsel incurred in connection therewith); (b) the
preparation, printing (including, without limitation, word processing and
duplication costs) and delivery of this Agreement, the Indenture, the
Registration Rights Agreement, all Blue Sky memoranda and all other agreements,
memoranda, correspondence and other documents printed and delivered in
connection therewith and with the Exempt Resales (but not, however, legal fees
and expenses of the Initial Purchasers’ counsel incurred in connection with any
of the foregoing other than reasonable and documented fees of counsel plus
reasonable disbursements incurred in connection with the preparation, printing
and delivery of such Blue Sky memoranda); (c) the issuance and delivery by the
Company of the Notes and by the Guarantors of the Guarantees and any taxes
payable in connection therewith; (d) the qualification of the Notes and Exchange
Notes for offer and sale under the securities or Blue Sky laws of the several
states and any foreign jurisdictions as the Initial Purchasers may designate
(including, without limitation, the reasonable and documented out of pocket fees
and disbursements of the Initial Purchasers’ counsel relating to such
registration or qualification); (e) the furnishing of such copies of the
Preliminary Offering Memorandum, the Pricing Disclosure Package and the Offering
Memorandum, and all amendments and supplements thereto, as may be reasonably
requested for use in connection with the Exempt Resales; (f) the preparation of
certificates for the Notes (including, without limitation, printing and
engraving thereof); (g) the approval of the Notes by DTC for “book-entry”
transfer; (h) the rating of the Notes and the Exchange Notes; (i) the
obligations of the Trustee, any agent of the Trustee and the counsel for the
Trustee in connection with the Indenture, the Notes, the Guarantees, the
Exchange Notes and the Exchange Guarantees; (j) the performance by the Company
and the Guarantors of their other obligations under this Agreement; and (k) all
of the travel expenses of the Company’s officers and employees and any other
expenses of the Company in connection with attending or hosting meetings with
prospective purchasers of the Notes, and expenses associated with any electronic
road show. For the avoidance of doubt, nothing in this section shall require the
Company and the Guarantors to pay any fees or disbursements of counsel to the
Initial Purchasers, other than those fees and disbursements described in clauses
(b) and (d) above.

7. Conditions to Initial Purchasers’ Obligations. The respective obligations of
the Initial Purchasers hereunder are subject to the accuracy, when made and on
and as of the Closing Date, of the representations and warranties of the Company
and the Guarantors contained herein, to the performance by the Company and the
Guarantors of their respective obligations hereunder, and to each of the
following additional terms and conditions:

(a) All corporate proceedings and other legal matters incident to the
authorization, form and validity of this Agreement, the Notes, the Guarantees,
the Exchange Notes, the Exchange Guarantees, the Registration Rights Agreement,
the Indenture, the Acquisition Agreement, the Pricing Disclosure Package and the
Offering Memorandum, and all other legal matters relating to this Agreement and
the transactions contemplated hereby shall be reasonably satisfactory in all
material respects to counsel for the Initial Purchasers, and the Company and the
Guarantors shall have furnished to such counsel all documents and information
that they may reasonably request to enable them to pass upon such matters.

 

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(b) Paul, Weiss, Rifkind, Wharton & Garrison LLP shall have furnished to the
Initial Purchasers its written opinion and negative assurance letter, as counsel
to the Company and the Guarantors, addressed to the Initial Purchasers and dated
the Closing Date, in form and substance reasonably satisfactory to the Initial
Purchasers, substantially in the form of Exhibit B-1 and B-2 hereto.

(c) Holland & Knight LLP shall have furnished to the Initial Purchasers its
written opinion, as counsel to the Company and the Guarantors, addressed to the
Initial Purchasers and dated the Closing Date, in form and substance reasonably
satisfactory to the Initial Purchasers, substantially in the form of Exhibit B-3
hereto.

(d) Califf & Harper, P.C. shall have furnished to the Initial Purchasers its
written opinion, as counsel to the Company and the Guarantors, addressed to the
Initial Purchasers and dated the Closing Date, in form and substance reasonably
satisfactory to the Initial Purchasers, substantially in the form of Exhibit B-4
hereto.

(e) The Initial Purchasers shall have received from Latham & Watkins LLP,
counsel for the Initial Purchasers, such opinion or opinions and negative
assurance letter, dated the Closing Date, with respect to the issuance and sale
of the Notes, the Pricing Disclosure Package, the Offering Memorandum and other
related matters as the Initial Purchasers may reasonably require, and the
Company shall have furnished to such counsel such documents and information as
such counsel reasonably requests for the purpose of enabling them to pass upon
such matters.

(f) At the time of execution of this Agreement, the Initial Purchasers shall
have received from Grant Thornton LLP a letter, in form and substance reasonably
satisfactory to the Initial Purchasers, addressed to the Initial Purchasers and
dated the date hereof (i) confirming that it is an independent public accountant
within the meaning of the Securities Act and are in compliance with the
applicable requirements relating to the qualification of accountants under Rule
2-01 of Regulation S-X of the Commission and (ii) stating, as of the date hereof
(or, with respect to matters involving changes or developments since the
respective dates as of which specified financial information is given in the
Pricing Disclosure Package, as of a date not more than three days prior to the
date hereof), the conclusions and findings of such firm with respect to the
financial information and (iii) covering such other matters as are ordinarily
covered by accountants’ “comfort letters” to underwriters in connection with
registered public offerings.

(g) With respect to the letter of Grant Thornton LLP referred to in the
preceding paragraph and delivered to the Initial Purchasers concurrently with
the execution of this Agreement (the “Grant Thornton initial letter”), Grant
Thornton LLP shall have furnished to the Initial Purchasers a “bring-down
letter” addressed to the Initial Purchasers and dated the Closing Date
(i) confirming that they are independent public accountants within the meaning
of the Securities Act and are in compliance with the applicable requirements
relating to the qualification of accountants under Rule 2-01 of Regulation S-X
of the Commission, (ii) stating, as of the Closing Date (or, with respect to
matters involving changes or developments since the respective dates as of which
specified financial information is given in each of the Pricing

 

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Disclosure Package or the Offering Memorandum, as of a date not more than three
days prior to the date of the Closing Date), the conclusions and findings of
such firm with respect to the financial information and other matters covered by
the Grant Thornton initial letter, and (iii) confirming in all material respects
the conclusions and findings set forth in the Grant Thornton initial letter.

(h) At the time of execution of this Agreement, the Initial Purchasers shall
have received from KPMG LLP a letter, in form and substance reasonably
satisfactory to the Initial Purchasers, addressed to the Initial Purchasers and
dated the date hereof (i) confirming that it is an independent public accountant
within the meaning of the Securities Act and are in compliance with the
applicable requirements relating to the qualification of accountants under Rule
2-01 of Regulation S-X of the Commission and (ii) stating, as of the date hereof
(or, with respect to matters involving changes or developments since the
respective dates as of which specified financial information is given in the
Pricing Disclosure Package, as of a date not more than three days prior to the
date hereof), the conclusions and findings of such firm with respect to the
financial information and (iii) covering such other matters as are ordinarily
covered by accountants’ “comfort letters” to underwriters in connection with
registered public offerings.

(i) With respect to the letter of KPMG LLP referred to in the preceding
paragraph and delivered to the Initial Purchasers concurrently with the
execution of this Agreement (the “KPMG initial letter”), KPMG LLP shall have
furnished to the Initial Purchasers a “bring-down letter” addressed to the
Initial Purchasers and dated the Closing Date (i) confirming that they are
independent public accountants within the meaning of the Securities Act and are
in compliance with the applicable requirements relating to the qualification of
accountants under Rule 2-01 of Regulation S-X of the Commission, (ii) stating,
as of the Closing Date (or, with respect to matters involving changes or
developments since the respective dates as of which specified financial
information is given in each of the Pricing Disclosure Package or the Offering
Memorandum, as of a date not more than three days prior to the date of the
Closing Date), the conclusions and findings of such firm with respect to the
financial information and other matters covered by the KPMG initial letter, and
(iii) confirming in all material respects the conclusions and findings set forth
in the KPMG initial letter.

(j) (i) Neither the Company, any Guarantor nor any of their respective
subsidiaries shall have sustained, since the date of the latest audited
financial statements included in the Pricing Disclosure Package and the Offering
Memorandum, any material loss or interference with its business from fire,
explosion, flood or other calamity, whether or not covered by insurance, or from
any labor dispute or court or governmental action, order or decree, or
(ii) since such date, there shall not have been any change in the capital stock
or long-term debt of the Company, any Guarantor or any of their respective
subsidiaries or any change, or any development involving a prospective change,
in or affecting the condition (financial or otherwise), results of operations,
stockholders’ equity, properties, management or business of the Company, the
Guarantors and their respective subsidiaries, taken as a whole, the effect of
which, in any such case described in clause (i) or (ii), is, individually or in
the aggregate, in the judgment of the Representatives, so material and adverse
as to make it impracticable or inadvisable to proceed with the offering or the
delivery of the Notes being delivered on the Closing Date on the terms and in
the manner contemplated in the Pricing Disclosure Package and the Offering
Memorandum.

 

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(k) The Company and each Guarantor shall have furnished or caused to be
furnished to the Initial Purchasers dated as of the Closing Date a certificate
of the Chief Executive Officer and Chief Financial Officer of the Company and
each Guarantor, or other officers satisfactory to the Initial Purchasers, as to
such matters as the Representatives may reasonably request, including, without
limitation, a statement that the representations, warranties and agreements of
the Company and the Guarantors in Section 2 are true and correct on and as of
the Closing Date, and the Company has complied with all its agreements contained
herein and satisfied all the conditions on its part to be performed or satisfied
hereunder at or prior to the Closing Date.

(l) The Notes shall be eligible for clearance and settlement through DTC.

(m) The Company and the Guarantors shall have executed and delivered the
Registration Rights Agreement and the Initial Purchasers shall have received an
original copy thereof, duly executed by the Company and the Guarantors.

(n) The Company, the Guarantors and the Trustee have executed and delivered the
Indenture, and the Initial Purchasers have received an original copy thereof,
duly executed by the Company, the Guarantors and the Trustee.

(o) Subsequent to the execution and delivery of this Agreement there shall not
have occurred any of the following: (i) trading in securities generally on the
New York Stock Exchange or the Nasdaq Stock Market, or trading in any securities
of the Company on any exchange or in the over-the-counter market, shall have
been suspended or materially limited or the settlement of such trading generally
shall have been materially disrupted or minimum prices shall have been
established on any such exchange or such market by the Commission, by such
exchange or by any other regulatory body or governmental authority having
jurisdiction, (ii) a general moratorium on commercial banking activities shall
have been declared by federal or New York State authorities, (iii) the United
States shall have become engaged in hostilities, there shall have been an
escalation in hostilities involving the United States or there shall have been a
declaration of a national emergency or war by the United States, or (iv) there
shall have occurred such a material adverse change in general economic,
political or financial conditions, including, without limitation, as a result of
terrorist activities after the date hereof (or the effect of international
conditions on the financial markets in the United States shall be such), as to
make it, in the judgment of the Representatives, impracticable or inadvisable to
proceed with the offering or delivery of the Notes being delivered on the
Closing Date on the terms and in the manner contemplated in the Offering
Memorandum or that, in the judgment of the Representatives, could materially and
adversely affect the financial markets or the markets for the Notes and other
debt securities.

(p) Substantially concurrent with the closing of the offering of the Notes, the
Acquisition shall be consummated in accordance with the terms of the Acquisition
Agreement as set forth in the Pricing Disclosure Package and the Offering
Memorandum.

 

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(q) There shall exist at and as of the Closing Date no condition that would
constitute a default (or an event that with notice or the lapse of time, or
both, would constitute a default) under the Indenture as in effect at the
Closing Date (or an event that with notice or lapse of time, or both, would
constitute such a default or material breach).

(r) On or prior to the Closing Date, the Company and the Guarantors shall have
furnished to the Initial Purchasers such further certificates and documents as
the Initial Purchasers may reasonably request.

All opinions, letters, evidence and certificates mentioned above or elsewhere in
this Agreement shall be deemed to be in compliance with the provisions hereof
only if they are in form and substance reasonably satisfactory to counsel for
the Initial Purchasers.

8. Indemnification and Contribution.

(a) The Company and each Guarantor hereby agree, jointly and severally, to
indemnify and hold harmless each Initial Purchaser, its affiliates, directors,
officers and employees and each person, if any, who controls any Initial
Purchaser within the meaning of Section 15 of the Securities Act or Section 20
of the Exchange Act, from and against any loss, claim, damage or liability,
joint or several, or any action in respect thereof (including, but not limited
to, any loss, claim, damage, liability or action relating to purchases and sales
of Notes), to which that Initial Purchaser, affiliate, director, officer,
employee or controlling person may become subject, under the Securities Act or
otherwise, insofar as such loss, claim, damage, liability or action arises out
of, or is based upon, (i) any untrue statement or alleged untrue statement of a
material fact contained (A) in any Free Writing Offering Document, the
Preliminary Offering Memorandum, the Pricing Disclosure Package or the Offering
Memorandum or in any amendment or supplement thereto, (B) in any Blue Sky
application or other document prepared or executed by the Company or any
Guarantor (or based upon any written information furnished by the Company or any
Guarantor) specifically for the purpose of qualifying any or all of the Notes
under the securities laws of any state or other jurisdiction (any such
application, document or information being hereinafter called a “Blue Sky
Application”), or (C) in any materials or information provided to investors by,
or with the approval of, the Company or any Guarantor in connection with the
marketing of the offering of the Notes (“Marketing Materials”), including any
road show or investor presentations made to investors by the Company (whether in
person or electronically) or (ii) the omission or alleged omission to state in
any Free Writing Offering Document, the Preliminary Offering Memorandum, the
Pricing Disclosure Package or the Offering Memorandum, or in any amendment or
supplement thereto, or in any Blue Sky Application or in any Marketing
Materials, any material fact necessary in order to make the statements therein,
in the light of the circumstances under which they were made, not misleading,
and shall reimburse each Initial Purchaser and each such director, officer,
employee or controlling person promptly upon demand for any legal or other
expenses reasonably incurred by that Initial Purchaser, director, officer,
employee or controlling person in connection with investigating or defending or
preparing to defend against any such loss, claim, damage, liability or action as
such expenses are incurred; provided, however, that the Company and the
Guarantors shall not be liable in any such case to the extent that any such
loss, claim, damage, liability or action arises out of, or is based upon, any
untrue statement or alleged

 

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untrue statement or omission or alleged omission made in any Free Writing
Offering Document, Preliminary Offering Memorandum, the Pricing Disclosure
Package or Offering Memorandum, or in any such amendment or supplement thereto,
or in any Blue Sky Application or in any Marketing Materials, in reliance upon
and in conformity with written information concerning such Initial Purchaser
furnished to the Company through the Representatives by or on behalf of any
Initial Purchaser specifically for inclusion therein, which information consists
solely of the information specified in Section 8(e). The foregoing indemnity
agreement is in addition to any liability that the Company or the Guarantors may
otherwise have to any Initial Purchaser or to any affiliate, director, officer,
employee or controlling person of that Initial Purchaser.

(b) Each Initial Purchaser, severally and not jointly, hereby agrees to
indemnify and hold harmless the Company, each Guarantor, their respective
officers and employees, each of their respective directors, and each person, if
any, who controls the Company or any Guarantor within the meaning of Section 15
of the Securities Act or Section 20 of the Exchange Act, from and against any
loss, claim, damage or liability, joint or several, or any action in respect
thereof, to which the Company, any Guarantor or any such director, officer,
employee or controlling person may become subject, under the Securities Act or
otherwise, insofar as such loss, claim, damage, liability or action arises out
of, or is based upon, (i) any untrue statement or alleged untrue statement of a
material fact contained (A) in any Free Writing Offering Document, Preliminary
Offering Memorandum, the Pricing Disclosure Package or the Offering Memorandum
or in any amendment or supplement thereto, (B) or in any Blue Sky Application or
(C) in any Marketing Materials, or (ii) the omission or alleged omission to
state in any Free Writing Offering Document, Preliminary Offering Memorandum,
the Pricing Disclosure Package or the Offering Memorandum, or in any amendment
or supplement thereto, or in any Blue Sky Application or in any Marketing
Materials, any material fact necessary in order to make the statements therein,
in the light of the circumstances under which they were made, not misleading,
but in each case only to the extent that the untrue statement or alleged untrue
statement or omission or alleged omission was made in reliance upon and in
conformity with written information concerning such Initial Purchaser furnished
to the Company through the Representatives by or on behalf of that Initial
Purchaser specifically for inclusion therein, which information is limited to
the information set forth in Section 8(e). The foregoing indemnity agreement is
in addition to any liability that any Initial Purchaser may otherwise have to
the Company, any Guarantor or any such director, officer, employee or
controlling person.

(c) Promptly after receipt by an indemnified party under this Section 8 of
notice of any claim or the commencement of any action, the indemnified party
shall, if a claim in respect thereof is to be made against the indemnifying
party under this Section 8, notify the indemnifying party in writing of the
claim or the commencement of that action; provided, however, that the failure to
notify the indemnifying party shall not relieve it from any liability that it
may have under this Section 8 except to the extent it has been materially
prejudiced (by the forfeiture of substantive rights or defenses) by such failure
and; provided, further, that the failure to notify the indemnifying party shall
not relieve it from any liability that it may have to an indemnified party
otherwise than under this Section 8. If any such claim or action shall be
brought against an indemnified party, and it shall notify the indemnifying party
thereof, the indemnifying party shall be entitled to participate therein and, to
the extent that it wishes, jointly with any other similarly notified
indemnifying party, to assume the defense thereof with counsel

 

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reasonably satisfactory to the indemnified party. After notice from the
indemnifying party to the indemnified party of its election to assume the
defense of such claim or action, the indemnifying party shall not be liable to
the indemnified party under this Section 8 for any legal or other expenses
subsequently incurred by the indemnified party in connection with the defense
thereof other than reasonable costs of investigation; provided, however, that
the indemnified party or parties shall have the right to employ its or their own
counsel in any such action if (i) the indemnified party and the indemnifying
party shall have so mutually agreed; (ii) the indemnifying party shall have
failed within a reasonable time to retain counsel reasonably satisfactory to the
indemnified party or parties; (iii) the indemnified party or parties shall have
reasonably concluded, based on the advice of counsel, that there may be legal
defenses available to them that are different from or in addition to those
available to the indemnified party; or (iv) the named parties in any such
proceeding (including any impleaded parties) include both the indemnifying
party, on the one hand, and the indemnified party, on the other hand, and
representation of both sets of parties by the same counsel would present a
conflict due to actual or potential differing interests between them, and in any
such event the reasonable and documented out-of-pocket fees and expenses of such
separate counsel shall be paid by the indemnifying party. In no event shall the
indemnifying parties be liable for the reasonable fees and expenses of more than
one counsel (together with appropriate local counsel) at any time for all
indemnified parties in connection with any one action or separate but
substantially similar or related actions arising in the same jurisdiction out of
the same general allegations or circumstances; provided that if the use of such
counsel chosen to represent all indemnified parties would present such counsel
with a conflict of interest, each indemnified party shall have the right to
select separate counsel to defend such action on behalf of such indemnified
party. No indemnifying party shall (x) without the prior written consent of the
indemnified parties (which consent shall not be unreasonably withheld), settle
or compromise or consent to the entry of any judgment with respect to any
pending or threatened claim, action, suit or proceeding in respect of which
indemnification or contribution may be sought hereunder (whether or not the
indemnified parties are actual or potential parties to such claim or action)
unless such settlement, compromise or consent includes an unconditional release
of each indemnified party from all liability arising out of such claim, action,
suit or proceeding and does not include a statement as to, or an admission of
fault, culpability or a failure to act by or on behalf of any indemnified party,
or (y) be liable for any settlement of any such action effected without its
written consent (which consent shall not be unreasonably withheld), but if
settled with the consent of the indemnifying party or if there be a final
judgment of the plaintiff in any such action, the indemnifying party agrees to
indemnify and hold harmless any indemnified party from and against any loss or
liability by reason of such settlement or judgment.

(d) If the indemnification provided for in this Section 8 shall for any reason
be unavailable to or insufficient to hold harmless an indemnified party under
Section 8(a) or 8(b) in respect of any loss, claim, damage or liability, or any
action in respect thereof, referred to therein, then each indemnifying party
shall, in lieu of indemnifying such indemnified party, contribute to the amount
paid or payable by such indemnified party as a result of such loss, claim,
damage or liability, or action in respect thereof, (i) in such proportion as
shall be appropriate to reflect the relative benefits received by the Company
and the Guarantors, on the one hand, and the Initial Purchasers, on the other,
from the offering of the Notes, or (ii) if the allocation provided by clause
(i) above is not permitted by applicable law, in such proportion as

 

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is appropriate to reflect not only the relative benefits referred to in clause
(i) above but also the relative fault of the Company and the Guarantors, on the
one hand, and the Initial Purchasers, on the other, with respect to the
statements or omissions that resulted in such loss, claim, damage or liability,
or action in respect thereof, as well as any other relevant equitable
considerations. The relative benefits received by the Company and the
Guarantors, on the one hand, and the Initial Purchasers, on the other, with
respect to such offering shall be deemed to be in the same proportion as the
total net proceeds from the offering of the Notes purchased under this Agreement
(before deducting expenses) received by the Company and the Guarantors, on the
one hand, and the total underwriting discounts and commissions received by the
Initial Purchasers with respect to the Notes purchased under this Agreement, on
the other hand, bear to the total gross proceeds from the offering of the Notes
under this Agreement as set forth on the cover page of the Offering Memorandum.
The relative fault shall be determined by reference to whether the untrue or
alleged untrue statement of a material fact or omission or alleged omission to
state a material fact relates to information supplied by the Company, the
Guarantors, or the Initial Purchasers, the intent of the parties and their
relative knowledge, access to information and opportunity to correct or prevent
such statement or omission. For purposes of the preceding two sentences, the net
proceeds deemed to be received by the Company shall be deemed to be also for the
benefit of the Guarantors, and information supplied by the Company shall also be
deemed to have been supplied by the Guarantors. The Company, the Guarantors and
the Initial Purchasers agree that it would not be just and equitable if
contributions pursuant to this Section 8(d) were to be determined by pro rata
allocation (even if the Initial Purchasers were treated as one entity for such
purpose) or by any other method of allocation that does not take into account
the equitable considerations referred to herein. The amount paid or payable by
an indemnified party as a result of the loss, claim, damage or liability, or
action in respect thereof, referred to above in this Section 8(d) shall be
deemed to include, for purposes of this Section 8(d), any legal or other
expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this Section 8(d), no Initial Purchaser shall be required to
contribute any amount in excess of the amount by which the net proceeds from the
sale to Eligible Purchasers of the Notes initially purchased by it exceeds the
amount of any damages that such Initial Purchaser has otherwise paid or become
liable to pay by reason of any untrue or alleged untrue statement or omission or
alleged omission. No person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. The Initial Purchasers’ obligations to contribute as provided
in this Section 8(d) are several in proportion to their respective purchase
obligations and not joint.

(e) The Initial Purchasers severally confirm and the Company and the Guarantors
acknowledge and agree that the statements with respect to the offering of the
Notes by the Initial Purchasers set forth in (i) the second sentence of the
second to last paragraph on the front cover of the Offering Memorandum and
(ii) the sub-section entitled “Stabilization and Short Positions” and the
fourth, fifth and sixth sentences of the first paragraph and the second
paragraph of the sub-section entitled “Rule 144A and Regulation S” of the
section entitled “Plan of Distribution,” in the Pricing Disclosure Package and
the Offering Memorandum are correct and constitute the only information
concerning such Initial Purchasers furnished in writing to the Company or any
Guarantor by or on behalf of the Initial Purchasers specifically for inclusion
in the Preliminary Offering Memorandum, the Pricing Disclosure Package and the
Offering Memorandum or in any amendment or supplement thereto.

 

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9. Defaulting Initial Purchasers.

(a) If, on the Closing Date, any Initial Purchaser defaults in its obligations
to purchase the Notes that it has agreed to purchase under this Agreement, the
remaining non-defaulting Initial Purchasers may in their discretion arrange for
the purchase of such Notes by the non-defaulting Initial Purchasers or other
persons satisfactory to the Company on the terms contained in this Agreement.
If, within 36 hours after any such default by any Initial Purchaser, the
non-defaulting Initial Purchasers do not arrange for the purchase of such Notes,
then the Company shall be entitled to a further period of 36 hours within which
to procure other persons satisfactory to the non-defaulting Initial Purchasers
to purchase such Notes on such terms. In the event that within the respective
prescribed periods, the non-defaulting Initial Purchasers notify the Company
that they have so arranged for the purchase of such Notes, or the Company
notifies the non-defaulting Initial Purchasers that it has so arranged for the
purchase of such Notes, either the non-defaulting Initial Purchasers or the
Company may postpone the Closing Date for up to seven full business days in
order to effect any changes that in the opinion of counsel for the Company or
counsel for the Initial Purchasers may be necessary in the Pricing Disclosure
Package, the Offering Memorandum or in any other document or arrangement, and
the Company agrees to promptly prepare any amendment or supplement to the
Pricing Disclosure Package or the Offering Memorandum that effects any such
changes. As used in this Agreement, the term “Initial Purchaser” includes, for
all purposes of this Agreement unless the context requires otherwise, any party
not listed in Schedule I hereto that, pursuant to this Section 9, purchases
Notes that a defaulting Initial Purchaser agreed but failed to purchase.

(b) If, after giving effect to any arrangements for the purchase of the Notes of
a defaulting Initial Purchaser or Initial Purchasers by the non-defaulting
Initial Purchasers and the Company as provided in paragraph (a) above, the
aggregate principal amount of such Notes that remains unpurchased does not
exceed one-eleventh of the aggregate principal amount of all the Notes, then the
Company shall have the right to require each non-defaulting Initial Purchaser to
purchase the principal amount of Notes that such Initial Purchaser agreed to
purchase hereunder plus such Initial Purchaser’s pro rata share (based on the
principal amount of Notes that such Initial Purchaser agreed to purchase
hereunder) of the Notes of such defaulting Initial Purchaser or Initial
Purchasers for which such arrangements have not been made; provided that the
non-defaulting Initial Purchasers shall not be obligated to purchase more than
110% of the aggregate principal amount of Notes that they agreed to purchase on
the Closing Date pursuant to the terms of Section 3.

(c) If, after giving effect to any arrangements for the purchase of the Notes of
a defaulting Initial Purchaser or Initial Purchasers by the non-defaulting
Initial Purchasers and the Company as provided in paragraph (a) above, the
aggregate principal amount of such Notes that remains unpurchased exceeds
one-eleventh of the aggregate principal amount of all the Notes, or if the
Company shall not exercise the right described in paragraph (b) above, then this
Agreement shall terminate without liability on the part of the non-defaulting
Initial Purchasers. Any termination of this Agreement pursuant to this Section 9
shall be without liability on the part

 

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of the Company or the Guarantors, except that the Company and each of the
Guarantors will continue to be liable for the payment of expenses as set forth
in Section 6 and except that the provisions of Section 8 shall not terminate and
shall remain in effect.

(d) Nothing contained herein shall relieve a defaulting Initial Purchaser of any
liability it may have to the Company, the Guarantors or any non-defaulting
Initial Purchaser for damages caused by its default.

10. Termination. The obligations of the Initial Purchasers hereunder may be
terminated by the Initial Purchasers by notice given to and received by the
Company prior to delivery of and payment for the Notes if, prior to that time,
any of the events described in Sections 7(j) or 7(o) shall have occurred or if
the Initial Purchasers shall decline to purchase the Notes for any reason
permitted under this Agreement.

11. Reimbursement of Initial Purchasers’ Expenses. If (a) the Company for any
reason fails to tender the Notes for delivery to the Initial Purchasers, or
(b) the Initial Purchasers shall decline to purchase the Notes for any reason
permitted under this Agreement, the Company and the Guarantors shall reimburse
the Initial Purchasers for all reasonable and documented out-of-pocket expenses
(including fees and disbursements of one firm of outside counsel for the Initial
Purchasers) incurred by the Initial Purchasers in connection with this Agreement
and the proposed purchase of the Notes, and upon demand the Company and the
Guarantors shall pay the full amount thereof to the Initial Purchasers. If this
Agreement is terminated pursuant to Section 9 by reason of the default of one or
more Initial Purchasers, the Company and the Guarantors shall not be obligated
to reimburse any defaulting Initial Purchaser on account of those expenses.

12. Notices, etc. All statements, requests, notices and agreements hereunder
shall be in writing, and:

(a) if to any Initial Purchasers, shall be delivered or sent by hand delivery,
mail, telex, overnight courier or facsimile transmission to Barclays Capital
Inc., 745 Seventh Avenue, New York, New York 10019, Attention: Syndicate
Registration with a copy to Latham & Watkins LLP, 885 Third Avenue, New York,
New York 10022, Attention: Greg Rodgers (Fax: 212-751-4864), and with a copy, in
the case of any notice pursuant to Section 8(c), to the Director of Litigation,
Office of the General Counsel, Barclays Capital Inc., 745 Seventh Avenue, New
York, New York 10019;

(b) if to the Company or any Guarantor, shall be delivered or sent by mail,
telex, overnight courier or facsimile transmission to The Hillman Group, Inc.,
10590 Hamilton Avenue, Cincinnati, Ohio 45231-1764, Attention: Chief Financial
Officer (Fax: 513-595-8297), with a copy to Paul, Weiss, Rifkind, Wharton &
Garrison LLP, 1285 Avenue of the Americas, New York, New York 10019, Attention:
John C. Kennedy (Fax: 212-492-0025);

provided, however, that any notice to an Initial Purchaser pursuant to
Section 8(c) shall be delivered or sent by hand delivery, mail, facsimile or
electronic transmission to such Initial Purchaser at its address set forth in
its acceptance telex to Barclays Capital Inc., which address will be supplied to
any other party hereto by Barclays Capital Inc. upon request. Any such
statements, requests, notices or agreements shall take effect at the time of
receipt thereof. The Company shall be entitled to act and rely upon any request,
consent, notice or agreement given or made on behalf of the Initial Purchasers
by Barclays Capital Inc.

 

30

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13. Persons Entitled to Benefit of Agreement. This Agreement shall inure to the
benefit of and be binding upon the Initial Purchasers, the Company, the
Guarantors and their respective successors. This Agreement and the terms and
provisions hereof are for the sole benefit of only those persons, except that
the representations, warranties, indemnities and agreements contained in this
Agreement shall also be deemed to be for the benefit of the other indemnified
parties referred to in clauses 8(a) and (b), and their respective successors and
assigns. Nothing in this Agreement is intended or shall be construed to give any
person, other than the persons referred to in this Section 14, any legal or
equitable right, remedy or claim under or in respect of this Agreement or any
provision contained herein.

14. Survival. The respective indemnities, rights of contribution,
representations, warranties and agreements of the Company, the Guarantors and
the Initial Purchasers contained in this Agreement or made by or on behalf of
them, respectively, pursuant to this Agreement, shall survive the delivery of
and payment for the Notes and shall remain in full force and effect, regardless
of any termination of this Agreement or any investigation made by or on behalf
of any of them or any person controlling any of them.

15. Definition of the Terms “Business Day”, “Affiliate”, and “Subsidiary”. For
purposes of this Agreement, (a) “business day” means any day on which the New
York Stock Exchange, Inc. is open for trading, and (b) “affiliate” and
“subsidiary” have the meanings set forth in Rule 405 under the Securities Act.

16. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York.

17. Waiver of Jury Trial. The Company and each of the Initial Purchasers hereby
irrevocably waives, to the fullest extent permitted by applicable law, any and
all right to trial by jury in any legal proceeding arising out of or relating to
this Agreement or the transactions contemplated hereby.

18. No Fiduciary Duty. The Company and the Guarantors acknowledge and agree that
in connection with this offering, or any other services the Initial Purchasers
may be deemed to be providing hereunder, notwithstanding any preexisting
relationship, advisory or otherwise, between the parties or any oral
representations or assurances previously or subsequently made by the Initial
Purchasers: (a) no fiduciary or agency relationship between the Company, and
Guarantor and any other person, on the one hand, and the Initial Purchasers, on
the other, exists; (b) the Initial Purchasers are not acting as advisors, expert
or otherwise, to the Company and the Guarantors, including, without limitation,
with respect to the determination of the purchase price of the Notes, and such
relationship between the Company and the Guarantors, on the one hand, and the
Initial Purchasers, on the other, is entirely and solely commercial, based on
arms-length negotiations; (c) any duties and obligations that the Initial
Purchasers may have to the Company and the Guarantors shall be limited to those
duties and obligations specifically stated herein; (d)

 

31

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the Initial Purchasers and their respective affiliates may have interests that
differ from those of the Company and the Guarantors; and (e) the Company and the
Guarantors have consulted their own legal and financial advisors to the extent
they deemed appropriate. The Company and the Guarantors hereby waive any claims
that the Company and the Guarantors may have against the Initial Purchasers with
respect to any breach of fiduciary duty in connection with the Notes.

19. Counterparts. This Agreement may be executed in one or more counterparts
and, if executed in more than one counterpart, the executed counterparts shall
each be deemed to be an original but all such counterparts shall together
constitute one and the same instrument.

20. Headings. The headings herein are inserted for convenience of reference only
and are not intended to be part of, or to affect the meaning or interpretation
of, this Agreement.

 

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If the foregoing correctly sets forth the agreement among the Company, the
Guarantors and the Initial Purchasers, please indicate your acceptance in the
space provided for that purpose below.

 

Very truly yours, THE HILLMAN GROUP, INC. By   /s/ James P. Waters Name:   James
P. Waters Title:   Chief Financial Officer

HILLMAN INVESTMENT COMPANY

THE HILLMAN COMPANIES, INC.

ALL POINTS INDUSTRIES, INC.

SUNSUB C INC.

SERV-A-LITE PRODUCTS, INC.

By:   /s/ James P. Waters Name:   James P. Waters Title:   Chief Financial
Officer

Accepted:

 

BARCLAYS CAPITAL INC.

MORGAN STANLEY & CO. INCORPORATED

 

By BARCLAYS CAPITAL INC., as

Authorized Representative

By:   /s/ Benjamin J. Burton Name:   Benjamin J. Burton Title:   Managing
Director

[Signature Page to Note Purchase Agreement]

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SCHEDULE I

 

Initial Purchasers

   Principal
Amount of
Notes
to be
Purchased  

Barclays Capital Inc.

   $ 25,000,000   

Morgan Stanley & Co. Incorporated

   $ 25,000,000            

Total

   $ 50,000,000            

 

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SCHEDULE II

LIST OF GUARANTORS

HILLMAN COMPANIES, INC.

HILLMAN INVESTMENT CO.

ALL POINTS INDUSTRIES, INC.

SUNSUB C INC.

SERV-A-LITE PRODUCTS, INC.

 

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SCHEDULE III

LOGO [g163565g96w37.jpg]

The Hillman Group, Inc.

$50,000,000 10.875% Senior Notes due 2018

March 11, 2011

 

Pricing Supplement Pricing Supplement dated March 11, 2011 to the Preliminary
Offering Memorandum dated March 11, 2011 of the Hillman Group, Inc. This Pricing
Supplement is qualified in its entirety by reference to the Preliminary Offering
Memorandum. The information in this Pricing Supplement supplements the
Preliminary Offering Memorandum and supersedes the information in the
Preliminary Offering Memorandum to the extent it is inconsistent with the
information in the Preliminary Offering Memorandum. Capitalized terms used in
this Pricing Supplement but not defined have the meanings given them in the
Preliminary Offering Memorandum.

Issuer

   The Hillman Group, Inc.

Guarantors

  

The Hillman Companies, Inc.

Hillman Investment Co.

All Points Industries, Inc.

SunSub C Inc.

Serv-A-Lite Products, Inc.

and each of the Issuer’s future Domestic Subsidiaries

Title of Securities

   10.875% Senior Notes due 2018 (the “Notes”)

Aggregate Principal Amount

   $50,000,000

Gross Proceeds

   $54,625,000 (excluding accrued and unpaid interest from December 1, 2010 to
the date of delivery paid in addition to the issue price, which will be paid to
the applicable holders on the next interest payment date, June 1, 2011)

Distribution

   144A/Regulation S with Registration Rights

Maturity Date

   June 1, 2018

Issue Price

   109.250%, plus pre-issuance accrued and unpaid interest from December 1, 2010

Coupon

   10.875%

Yield to Maturity

   9.092%

Spread to Benchmark Treasury

   632 basis points

Benchmark Treasury

   3.875% due May 15, 2018

Interest Payment Dates

   June 1 and December 1 of each year, beginning on June 1, 2011

Record Dates

   May 15 and November 15 of each year

 

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Ratings*

   B3 (Moody’s)/CCC+ (S&P)   

Trade Date

   March 11, 2011   

Settlement Date

  

March 16, 2011 (T+3)

 

We expect that delivery of the notes will be made against payment therefor on or
about the third business day following the date of confirmation of orders with
respect to the notes (this settlement cycle being referred to as “T+3”).

  

     

Make-Whole Redemption

   Make-whole redemption at Treasury Rate + 50 basis points prior to June 1,
2014    

Optional Redemption

   On or after June 1, 2014, at the following redemption prices (expressed as a
percentage of principal amount), plus accrued and unpaid interest, if any, on
the Notes redeemed during the twelve-month period indicated beginning on June 1
of the years indicated below:             

Year

   Price      2014      105.438 %     2015      102.719 %     2016 and
thereafter      100.000 % 

Equity Clawback

   Up to 35% at 110.875% prior to June 1, 2013   

Change of Control

   101% plus accrued and unpaid interest   

Joint Book-Running Managers

  

Barclays Capital Inc.

 

Morgan Stanley & Co. Incorporated

  

  

CUSIP Numbers

  

Rule 144A: 43162R AC8

 

Regulation S: U4328P AB4

  

  

ISIN Numbers

  

Rule 144A: US43162RAC88

 

Regulation S: USU4328PAB41

  

  

Denominations

   Minimum denominations of $2,000 and integral multiples of $1,000 in excess
thereof    

 

* Note: A securities rating is not a recommendation to buy, sell or hold
securities and may be subject to revision or withdrawal at any time.

 

 

This material is strictly confidential and has been prepared by the Issuer
solely for use in connection with the proposed offering of the securities
described in the Preliminary Offering Memorandum. This material is personal to
each offeree and does not constitute an offer to any other person or the public
generally to subscribe for or otherwise acquire the securities. Please refer to
the Preliminary Offering Memorandum for a complete description.

The securities have not been registered under the Securities Act of 1933, as
amended (the “Securities Act”), and are being offered only to (1) “qualified
institutional buyers” as defined in Rule 144A under the Securities Act and
(2) outside the United States to non-U.S. persons in compliance with Regulation
S under the Securities Act, and this communication is only being distributed to
such persons.

This communication is not an offer to sell the securities and it is not a
solicitation of an offer to buy the securities in any jurisdiction to any person
to whom it is unlawful to make such offer or solicitation in such jurisdiction.

 

2

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SCHEDULE IV

 

A. Each document provided as an amendment or supplement to the Preliminary
Offering Memorandum:

None.

 

B. Free Writing Offering Documents:

None.

 

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SCHEDULE V

LIST OF SUBSIDIARIES

ALL POINTS INDUSTRIES, INC.

SUNSUB C INC

THE HILLMAN GROUP CANADA, LTD

SUNSOURCE INTEGRATED SERVICES DE MEXICO S.A. DE C.V.

SERV-A-LITE PRODUCTS, INC.

 

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Exhibit A

FORM OF REGISTRATION RIGHTS AGREEMENT

This Registration Rights Agreement (this “Agreement”) is made and entered into
as of March 16, 2011 by and among the Hillman Group, Inc., a Delaware
corporation (the “Company”), the guarantors listed on Schedule I hereto (the
“Guarantors”) and Barclays Capital Inc. and Morgan Stanley & Co. Incorporated,
as representatives of the several initial purchasers named in Schedule I
attached to the Purchase Agreement (as defined below) (each such initial
purchaser, an “Initial Purchaser” and, together, the “Initial Purchasers”), each
of whom has agreed to purchase the Company’s 10.875% Senior Notes Due 2018 (the
“Initial Notes”) pursuant to the Purchase Agreement (as defined below).

This Agreement is made pursuant to the Purchase Agreement, dated March 11, 2011
(the “Purchase Agreement”), by and among the Company, the Guarantors and the
Initial Purchasers. In order to induce the Initial Purchasers to purchase the
Initial Notes, the Company and the Guarantors have agreed to provide the
registration rights set forth in this Agreement. The execution and delivery of
this Agreement is a condition to the obligations of the Initial Purchasers set
forth in Section 7 of the Purchase Agreement. Capitalized terms used herein and
not otherwise defined shall have the meaning assigned to them in the Indenture,
dated as of May 28, 2010, among the Company, the Guarantors and Wells Fargo
Bank, National Association, as trustee, relating to the Initial Notes and the
Exchange Notes, as amended and supplemented by the First Supplemental Indenture,
dated as of December 29, 2010 (as so amended and supplemented, the “Indenture”).

The parties hereby agree as follows:

 

  1. DEFINITIONS

As used in this Agreement, the following capitalized terms shall have the
following meanings:

Act: The Securities Act of 1933, as amended, and the rules and regulations of
the Commission promulgated thereunder.

Affiliate: As defined in Rule 144 of the Act.

Broker-Dealer: Any broker or dealer registered under the Exchange Act.

Business Day: Any day other than a Saturday, a Sunday or a day on which banking
institutions in the City of New York or at a place of payment are authorized by
law, regulation or executive order to remain closed. If the time to perform any
action hereunder falls on a day that is not a Business Day, such time will be
extended to the next Business Day and no Special Interest shall accrue for the
intervening period.

 

1

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Closing Date: The date hereof.

Commission: The Securities and Exchange Commission.

Consummate: An Exchange Offer shall be deemed “Consummated” for purposes of this
Agreement upon the occurrence of (a) the filing and effectiveness under the Act
of the Exchange Offer Registration Statement relating to the Exchange Notes to
be issued in the Exchange Offer, (b) the maintenance of such Exchange Offer
Registration Statement continuously effective and the keeping of the Exchange
Offer open for a period not less than the period required pursuant to
Section 3(b) hereof, and (c) the delivery by the Company to the Registrar (as
defined in the Indenture) under the Indenture of Exchange Notes in the same
aggregate principal amount as the aggregate principal amount of Initial Notes
tendered by Holders thereof pursuant to the Exchange Offer.

Consummation Deadline: As defined in Section 3(b) hereof.

Effectiveness Deadline: As defined in Sections 3(a) and 4(a) hereof.

Exchange Act: The Securities Exchange Act of 1934, as amended, and the rules and
regulations of the Commission promulgated thereunder.

Exchange Notes: The Company’s 10.875% Senior Notes due 2018 to be issued
pursuant to the Indenture: (i) in the Exchange Offer or (ii) as contemplated by
Section 4 hereof.

Exchange Offer: The exchange and issuance by the Company of a principal amount
of Exchange Notes (which shall be registered pursuant to the Exchange Offer
Registration Statement) equal to the outstanding principal amount of Initial
Notes that are validly tendered and not withdrawn by such Holders in connection
with such exchange and issuance.

Exchange Offer Registration Statement: The Registration Statement relating to
the Exchange Offer, including the related Prospectus.

Filing Deadline: As defined in Sections 3(a) and 4(a) hereof.

Free Writing Prospectus: Each offer to sell or solicitation of an offer to buy
the Initial Notes or the Exchange Notes that would constitute a “free writing
prospectus” as defined in Rule 405 under the Securities Act, prepared by or on
behalf of the Company or used or referred to by the Company in connection with
the sale of the Initial Notes or the Exchange Notes.

Holders: As defined in Section 2 hereof.

Interest Payment Date: As defined in the Initial Notes and Exchange Notes.

Prospectus: The prospectus included in a Registration Statement at the time such
Registration Statement is declared effective, as amended or supplemented by any
prospectus supplement and by all other amendments thereto, including
post-effective amendments, and all material incorporated by reference into such
Prospectus.

 

2

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Recommencement Date: As defined in Section 6(d) hereof.

Registration Default: As defined in Section 5 hereof.

Registration Statement: Any registration statement of the Company and the
Guarantors relating to (a) an offering of Exchange Notes pursuant to an Exchange
Offer or (b) the registration for resale of Transfer Restricted Securities
pursuant to the Shelf Registration Statement, in each case, (i) that is filed
pursuant to the provisions of this Agreement, (ii) including the Prospectus
included therein, and (iii) including all amendments and supplements thereto
(including post-effective amendments) and all exhibits and material incorporated
by reference therein.

Rule 144: Rule 144 promulgated under the Act.

Shelf Registration Statement: As defined in Section 4 hereof.

Special Interest. As defined in Section 5 hereof.

Suspension Notice: As defined in Section 6(d) hereof.

Transfer Restricted Securities: Each Initial Note until the earliest to occur of
(a) the date on which such Initial Note has been exchanged in the Exchange Offer
by a Person other than a Broker-Dealer for an Exchange Note and is entitled to
be resold to the public by the Holder thereof without complying with the
prospectus delivery requirements of the Act, (b) following the exchange by a
Broker-Dealer in the Exchange Offer of an Initial Note for an Exchange Note, the
date on which such Exchange Note is sold to a purchaser who receives from such
Broker-Dealer on or prior to the date of such sale a copy of the Prospectus
contained in the Exchange Offer Registration Statement, (c) the date on which
such Initial Note has been effectively registered under the Act and disposed of
in accordance with the Shelf Registration Statement; (d) the date on which such
Initial Note is sold or otherwise distributed to a Person who is not the Company
or an Affiliate of the Company; provided, that an Initial Note will not cease to
be a Transfer Restricted Security for purposes of the Exchange Offer by virtue
of this clause (d); or (e) the earliest date that is no less than two years
after the date of the Indenture and on which all such Initial Notes (except for
Initial Notes held by an Affiliate of the Company) are no longer subject to any
restrictions on transfer under the Act, including Rule 144.

 

  2. HOLDERS

A Person is deemed to be a holder of Transfer Restricted Securities (each, a
“Holder”) whenever such Person owns Transfer Restricted Securities.

 

3

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  3. REGISTERED EXCHANGE OFFER

(a) To the extent not prohibited by any applicable law or Commission policy, the
Company and the Guarantors shall (i) cause the Exchange Offer Registration
Statement to be filed with the Commission no later than the 180th day after the
initial issuance of the Initial Notes (such date being the “Filing Deadline”),
(ii) use all commercially reasonable efforts to cause such Exchange Offer
Registration Statement to become effective no later than 270 days after the
Filing Deadline (such 270th day being the “Effectiveness Deadline”), (iii) in
connection with the foregoing, use all commercially reasonable efforts to
(A) file all pre-effective amendments to such Exchange Offer Registration
Statement as may be necessary in order to cause it to become effective,
(B) file, if applicable, a post-effective amendment to such Exchange Offer
Registration Statement, and (C) cause all necessary filings, if any, in
connection with the registration and qualification of the Exchange Notes to be
made under the Blue Sky laws of such jurisdictions as are necessary to permit
Consummation of the Exchange Offer, provided, however, that neither the Company
nor any Guarantor shall be required to take any action that would subject them
to general service of process or taxation in any jurisdiction where they are not
already subject, and (iv) unless the Exchange Offer shall not be permitted by
applicable law or Commission policy (after the procedures set forth in
Section 6(a)(i) below have been complied with), upon the effectiveness of such
Exchange Offer Registration Statement, commence and use all commercially
reasonable efforts to Consummate the Exchange Offer. The Exchange Offer shall be
on the appropriate form permitting (i) registration of the Exchange Notes to be
offered in exchange for the Initial Notes that are Transfer Restricted
Securities and (ii) resales of Exchange Notes by Broker-Dealers that tendered
into the Exchange Offer Initial Notes that such Broker-Dealer acquired for its
own account as a result of market-making activities or other trading activities
(other than Initial Notes acquired directly from the Company or any of its
Affiliates) as contemplated by Section 3(c) below.

(b) To the extent not prohibited by any applicable law or Commission policy, the
Company and the Guarantors shall use all commercially reasonable efforts to
cause the Exchange Offer Registration Statement to be effective continuously,
and shall keep the Exchange Offer open for a period of not less than the minimum
period required under applicable federal and state securities laws to Consummate
the Exchange Offer; provided, however, that in no event shall such period be
less than 20 Business Days. The Company and the Guarantors shall cause the
Exchange Offer to comply with all applicable federal and state securities laws.
No securities other than the Exchange Notes shall be included in the Exchange
Offer Registration Statement. The Company and the Guarantors shall use all
commercially reasonable efforts to cause the Exchange Offer to be Consummated on
the earliest practicable date after the Exchange Offer Registration Statement
has become effective, but in no event later than 30 Business Days or longer, if
required by the federal securities laws, after the date on which the Exchange
Offer Registration Statement has become effective (such 30th day, or such later
date required by the federal securities laws, being the “Consummation
Deadline”).

(c) The Company shall include a “Plan of Distribution” section in the Prospectus
contained in the Exchange Offer Registration Statement and indicate therein that
any Broker-Dealer who holds Transfer Restricted Securities that were acquired
for the account of such Broker-Dealer as a result of market-making activities or
other trading activities (other than

 

4

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Initial Notes acquired directly from the Company or any Affiliate of the
Company), may exchange such Transfer Restricted Securities pursuant to the
Exchange Offer. Such “Plan of Distribution” section shall also contain all other
information with respect to such sales by such Broker-Dealers that the
Commission may require in order to permit such sales pursuant thereto, but such
“Plan of Distribution” shall not name any such Broker-Dealer or disclose the
amount of Transfer Restricted Securities held by any such Broker-Dealer, except
to the extent required by the Commission as a result of a change in policy,
rules or regulations after the date of this Agreement.

Because such Broker-Dealer may be deemed to be an “underwriter” within the
meaning of the Act and must, therefore, deliver a prospectus meeting the
requirements of the Act in connection with its initial sale of any Exchange
Notes received by such Broker-Dealer in the Exchange Offer, the Company and
Guarantors shall permit the use of the Prospectus contained in the Exchange
Offer Registration Statement by such Broker Dealer to satisfy such prospectus
delivery requirement. To the extent necessary to ensure that the Prospectus
contained in the Exchange Offer Registration Statement is available for sales of
Exchange Notes by Broker-Dealers, the Company and the Guarantors agree to use
all commercially reasonable efforts to keep the Exchange Offer Registration
Statement continuously effective, supplemented, amended and current as required
by and subject to the provisions of Sections 6(a) and (c) hereof and in
conformity with the requirements of this Agreement, the Act and the policies,
rules and regulations of the Commission as announced from time to time, for a
period of 180 days from the Consummation Deadline or such shorter period as will
terminate when all Transfer Restricted Securities covered by such Registration
Statement have been sold pursuant thereto. The Company and the Guarantors shall
provide sufficient copies of the latest version of such Prospectus to such
Broker-Dealers, promptly upon request, and in no event later than five Business
Days after such request, at any time during such period.

 

  4. SHELF REGISTRATION

(a) Shelf Registration. If (i) the Company and the Guarantors are not
(A) required to file the Exchange Offer Registration Statement or (B) permitted
to Consummate the Exchange Offer because the Exchange Offer is not permitted by
applicable law or Commission policy (after the Company and the Guarantors have
complied with the procedures set forth in Section 6(a)(i) below) or (ii) any
Holder notifies the Company prior to the 20th Business Day following
Consummation of the Exchange Offer that (A) such Holder is prohibited by law or
Commission policy from participating in the Exchange Offer, (B) such Holder may
not resell the Exchange Notes acquired by it in the Exchange Offer to the public
without delivering a prospectus and the Prospectus contained in the Exchange
Offer Registration Statement is not appropriate or available for such resales by
such Holder or (C) such Holder is a Broker-Dealer and holds Initial Notes
acquired directly from the Company or any of its Affiliates, then the Company
and the Guarantors shall:

(x) use all commercially reasonable efforts to file, on or prior to the later of
(i) 30 days after the earlier of (A) the date as of which the Company determines
that the Exchange Offer Registration Statement will not be or cannot be, as the
case may be, filed as a result of clause (a)(i) above and (B) the date on which
the Company receives the notice specified in clause (a)(ii) above and (ii) 180
days after the initial issuance of the Initial Notes (such later date, the
“Shelf Filing Deadline”), a shelf registration statement pursuant to Rule 415
under the Act (which may be an amendment to the Exchange Offer Registration
Statement (the “Shelf Registration Statement”)), covering the resale of all
Transfer Restricted Securities, and

 

5

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(y) use all commercially reasonable efforts to cause such Shelf Registration
Statement to become effective on or prior to the later of (i) 60 days after the
Shelf Filing Deadline and (ii) 270 days after the initial issuance of the
Initial Notes (such later date, the “Shelf Effectiveness Deadline”).

If, after the Company and the Guarantors have filed an Exchange Offer
Registration Statement that satisfies the requirements of Section 3(a) above,
the Company and the Guarantors are required to file and make effective a Shelf
Registration Statement solely because the Exchange Offer is not permitted under
applicable federal law (i.e., clause (a)(i)(B) above), then the filing of the
Exchange Offer Registration Statement shall be deemed to satisfy the
requirements of clause (x) above; provided that, in such event, the Company and
the Guarantors shall remain obligated to meet the Shelf Effectiveness Deadline
set forth in clause (y).

To the extent necessary to ensure that the Shelf Registration Statement is
available for sales of Transfer Restricted Securities by the Holders thereof
entitled to the benefit of this Section 4(a) and the other securities required
to be registered therein pursuant to Section 6(b)(ii) hereof, the Company and
the Guarantors shall use all commercially reasonable efforts to keep any Shelf
Registration Statement required by this Section 4(a) continuously effective,
supplemented, amended and current as required by and subject to the provisions
of Sections 6(b) and 6(c) hereof and in conformity with the requirements of this
Agreement, the Act and the policies, rules and regulations of the Commission as
announced from time to time, for a period of at least one year (as extended
pursuant to Section 6(c)(i) or 6(d)) following the Closing Date, or such shorter
period as will terminate when all Transfer Restricted Securities covered by such
Shelf Registration Statement have been sold pursuant thereto or are no longer
Transfer Restricted Securities.

(b) Provision by Holders of Certain Information in Connection with the Shelf
Registration Statement. No Holder may include any of its Transfer Restricted
Securities in any Shelf Registration Statement pursuant to this Agreement unless
and until such Holder furnishes to the Company in writing, within 15 days after
receipt of a request therefor, the information specified in Item 507 or 508 of
Regulation S-K, as applicable, of the Act, or other information reasonably
requested by the Company or required by Regulation S-K of the Act, for use in
connection with any Shelf Registration Statement or Prospectus or preliminary
Prospectus included therein. No Holder shall be entitled to Special Interest
pursuant to Section 5 hereof unless and until (and from and after such time)
such Holder shall have provided all such information. Each selling Holder agrees
to promptly furnish additional information required to be disclosed in order to
make the information previously furnished to the Company by such Holder not
materially misleading and shall promptly supply such other information as the
Company may from time to time reasonably request.

 

6

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  5. SPECIAL INTEREST

If (i) any Registration Statement required by this Agreement is not filed with
the Commission on or prior to the applicable Filing Deadline, (ii) any such
Registration Statement has not been declared effective by the Commission on or
prior to the applicable Effectiveness Deadline, (iii) the Exchange Offer has not
been Consummated on or prior to 30 Business Days after the Effectiveness
Deadline with respect to the Exchange Offer Registration Statement, or (iv) any
Registration Statement required by this Agreement is filed and declared
effective but shall thereafter cease to be effective or fail to be usable for
its intended purpose (each such event referred to in clauses (i) through (iv), a
“Registration Default”), then the Company and the Guarantors hereby jointly and
severally agree to pay to each Holder affected thereby special interest
(“Special Interest”) in an amount equal to 0.25% per annum of the principal
amount of Transfer Restricted Securities held by such Holder for each week or
portion thereof that the Registration Default continues for the first 90-day
period immediately following the occurrence of the first such Registration
Default. The amount of Special Interest shall increase by an additional
0.25% per annum of the principal amount of Transfer Restricted Securities with
respect to each subsequent 90-day period until all Registration Defaults have
been cured, up to a maximum amount of Special Interest of 0.50% per annum of the
principal amount of Transfer Restricted Securities; provided that the Company
and the Guarantors shall in no event be required to pay Special Interest for
more than one Registration Default at any given time. Notwithstanding anything
to the contrary set forth herein, (1) upon filing of the Exchange Offer
Registration Statement (and/or, if applicable, the Shelf Registration
Statement), in the case of clause (i) above, (2) upon the effectiveness of the
Exchange Offer Registration Statement (and/or, if applicable, the Shelf
Registration Statement), in the case of clause (ii) above, (3) upon Consummation
of the Exchange Offer, in the case of clause (iii) above, or (4) upon the filing
of a post-effective amendment to the Registration Statement or an additional
Registration Statement that causes the Exchange Offer Registration Statement
(and/or, if applicable, the Shelf Registration Statement) to again be declared
effective or made usable in the case of clause (iv) above, the Special Interest
payable with respect to the Transfer Restricted Securities as a result of such
clause (i), (ii), (iii), or (iv), as applicable, shall cease on the date of such
cure and the interest rate on such Transfer Restricted Securities will revert to
the interest rate on such Transfer Restricted Securities prior to the applicable
Registration Default.

All accrued Special Interest shall be paid by the Company and the Guarantors (or
the Company and the Guarantors will cause the Paying Agent to make such payment
on their behalf) to the Holders entitled thereto, in the manner provided for the
payment of interest in the Indenture, on each Interest Payment Date, as more
fully set forth in the Indenture, the Initial Notes and the Exchange Notes.
Notwithstanding the fact that any securities for which Special Interest are due
cease to be Transfer Restricted Securities, all obligations of the Company and
the Guarantors to pay Special Interest with respect to securities that accrued
prior to the time that such securities ceased to be Transfer Restricted
Securities shall survive until such time as such obligations with respect to
such securities shall have been satisfied in full.

 

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  6. REGISTRATION PROCEDURES

(a) Exchange Offer Registration Statement. In connection with the Exchange
Offer, the Company and the Guarantors shall (x) comply with all applicable
provisions of Section 6(c) below, (y) use all commercially reasonable efforts to
effect such exchange and to permit the resale of Exchange Notes by
Broker-Dealers that tendered in the Exchange Offer Initial Notes that such
Broker-Dealer acquired for its own account as a result of its market-making
activities or other trading activities (other than Initial Notes acquired
directly from the Company or any of its Affiliates) being sold in accordance
with the intended method or methods of distribution thereof, and (z) comply with
all of the following provisions:

(aa) If, following the date hereof there has been announced a change in
Commission policy with respect to exchange offers such as the Exchange Offer,
that in the reasonable opinion of counsel to the Company raises a substantial
question as to whether the Exchange Offer is permitted by applicable federal
law, the Company and the Guarantors hereby agree to use all commercially
reasonable efforts to either (x) seek a no-action letter or other favorable
decision from the Commission allowing the Company and the Guarantors to
Consummate an Exchange Offer for such Transfer Restricted Securities, or
(y) file, in accordance with Section 4(a) hereof, a Shelf Registration Statement
to permit the registration and/or resale of the Transfer Restricted Securities
that would otherwise be covered by the Exchange Offer Registration Statement but
for the announcement of a change in Commission policy. In the case of clause
(x) above, the Company and the Guarantors hereby agree to pursue the issuance of
such a decision to the Commission staff level but shall not be required to take
action not commercially reasonable to affect a change of Commission policy. In
connection with the foregoing, the Company and the Guarantors hereby agree to
take all such other actions as may be requested by the Commission or otherwise
reasonably required in connection with the issuance of such decision, including
without limitation (A) participating in telephonic conferences with the
Commission, (B) delivering to the Commission staff an analysis prepared by
counsel to the Company setting forth the legal bases, if any, upon which such
counsel has concluded that such an Exchange Offer should be permitted, and
(C) diligently pursuing a resolution (which need not be favorable and which need
not be a written resolution) by the Commission staff.

(ab) As a condition to its participation in the Exchange Offer, each Holder
(including, without limitation, any Holder who is a Broker-Dealer) shall
furnish, upon the request of the Company, prior to the Consummation of the
Exchange Offer, a written representation to the Company and the Guarantors
(which may be contained in the letter of transmittal contemplated by the
Exchange Offer Registration Statement) to the effect that (A) it is not an
Affiliate of the Company, (B) it is not engaged in, and does not intend to
engage in, and has no arrangement or understanding with any Person to
participate in,

 

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a distribution of the Exchange Notes to be issued in the Exchange Offer, (C) it
is acquiring the Exchange Notes in its ordinary course of business, and (D) only
if such Holder is a Broker-Dealer that will receive Exchange Notes in exchange
for Initial Notes that such Broker-Dealer acquired for its own private account
as a result of market making or other trading activities, it will deliver a
Prospectus, as required by law, in connection with any sale of such Exchange
Notes. As a condition to its participation in the Exchange Offer, each Holder
using the Exchange Offer to participate in a distribution of the Exchange Notes
shall acknowledge and agree that, if the resales are of Exchange Notes obtained
by such Holder in exchange for Initial Notes acquired directly from the Company
or an Affiliate thereof, it (1) could not, under Commission policy as in effect
on the date of this Agreement, rely on the position of the Commission enunciated
in Morgan Stanley and Co., Inc. (available June 5, 1991) and Exxon Capital
Holdings Corporation (available May 13, 1988), as interpreted in the
Commission’s letter to Shearman & Sterling dated July 2, 1993, and similar
no-action letters (including, if applicable, any no-action letter obtained
pursuant to clause (i) above), and (2) must comply with the registration and
prospectus delivery requirements of the Act in connection with a secondary
resale transaction and that such a secondary resale transaction must be covered
by an effective registration statement containing the selling security holder
information required by Item 507 or 508, as applicable, of Regulation S-K.

(ac) Prior to effectiveness of the Exchange Offer Registration Statement, the
Company and the Guarantors shall provide a supplemental letter to the Commission
(A) stating that the Company and the Guarantors are registering the Exchange
Offer in reliance on the position of the Commission enunciated in Exxon Capital
Holdings Corporation (available May 13, 1988), Morgan Stanley and Co., Inc.
(available June 5, 1991) as interpreted in the Commission’s letter to Shearman &
Sterling dated July 2, 1993, and, if applicable, any no-action letter obtained
pursuant to clause (i) above, (B) including a representation that the Company
and Guarantors have not entered into any arrangement or understanding with any
Person to distribute the Exchange Notes to be received in the Exchange Offer and
that, to the Company’s and each Guarantor’s information and belief, each Holder
participating in the Exchange Offer is acquiring the Exchange Notes in its
ordinary course of business and has no arrangement or understanding with any
Person to participate in the distribution of the Exchange Notes received in the
Exchange Offer, and (C) any other undertaking or representation required by the
Commission as set forth in any no-action letter obtained pursuant to clause
(i) above, if applicable.

(b) Shelf Registration Statement. In connection with the Shelf Registration
Statement, the Company and the Guarantors shall:

(aa) comply with all the provisions of Section 6(c) below and use all
commercially reasonable efforts to effect such registration to permit the sale
of the Transfer Restricted Securities being sold in accordance with the intended
method or

 

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methods of distribution thereof (as indicated in the information furnished to
the Company pursuant to Section 4(b) hereof), and pursuant thereto the Company
and the Guarantors will prepare and file with the Commission a Registration
Statement relating to the registration on any appropriate form under the Act,
which form shall be available for the sale of the Transfer Restricted Securities
in accordance with the intended method or methods of distribution thereof within
the time periods and otherwise in accordance with the provisions hereof, and

(ii) issue to any purchaser of Initial Notes covered by any Shelf Registration
Statement contemplated by this Agreement, upon the request of the purchaser,
registered Initial Notes having an aggregate principal amount equal to the
aggregate principal amount of Initial Notes sold pursuant to the Shelf
Registration Statement and surrendered to the Company for cancellation in the
names as such purchaser shall designate; provided that such purchaser provides
all documentation reasonably requested by the Company in connection with such
issuance.

(c) General Provisions. In connection with any Registration Statement and any
related Prospectus required by this Agreement, the Company and the Guarantors
shall:

(aa) use all commercially reasonable efforts to keep such Registration Statement
continuously effective and provide all requisite financial statements for the
period specified in Section 3 or 4 of this Agreement, as applicable. Upon the
occurrence of any event that would cause any such Registration Statement or the
Prospectus contained therein (A) to contain an untrue statement of material fact
or omit to state any material fact required to be stated therein or necessary to
make the statements therein not misleading, or (B) not to be effective and
usable for resale of Transfer Restricted Securities during the period required
by this Agreement, the Company and the Guarantors shall file as promptly as
practicable an appropriate amendment to such Registration Statement curing such
defect, and, if Commission review is required, use all commercially reasonable
efforts to cause such amendment to be declared effective as soon as practicable.

(ab) use all commercially reasonable efforts to prepare and file with the
Commission such amendments and post-effective amendments to the applicable
Registration Statement as may be necessary to keep such Registration Statement
effective for the applicable period set forth in Section 3 or 4 hereof, as the
case may be; cause the Prospectus to be supplemented by any required Prospectus
supplement, and as so supplemented to be filed pursuant to Rule 424 under the
Act, and to comply fully with Rules 424, 430A, and 462, as applicable, under the
Act in a timely manner; and comply with the provisions of the Act with respect
to the disposition of all securities covered by such Registration Statement
during the applicable period in accordance with the intended method or methods
of distribution by the sellers thereof set forth in such Registration Statement
or supplement to the Prospectus;

 

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(ac) advise (a) each Holder whose Transfer Restricted Securities have been
included in a Shelf Registration Statement (in the case of a Shelf Registration
Statement), and (b) each Holder who has provided notice to the Company promptly
and, if requested by such Holder, confirm such advice in writing, (A) when the
Prospectus or any Prospectus supplement or post-effective amendment has been
filed, and, with respect to any applicable Registration Statement or any
post-effective amendment thereto, when the same has become effective, (B) of any
request by the Commission for amendments to the Registration Statement or
amendments or supplements to the Prospectus or for additional information
relating thereto, (C) of the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement under the Act or of
the suspension by any state securities commission of the qualification of the
Transfer Restricted Securities for offering or sale in any jurisdiction, or the
initiation of any proceeding for any of the preceding purposes, and (D) of the
happening of any event that requires the Company to make changes in the
Registration Statement or the Prospectus in order that the Registration
Statement or the Prospectus, any amendment or supplement thereto or any document
incorporated by reference therein do not contain an untrue statement of material
fact nor omit to state a material fact required to be stated therein or
necessary to make the statements therein (in the case of the Prospectus, in
light of the circumstances under which they were made) not misleading. If at any
time the Commission shall issue any stop order suspending the effectiveness of
the Registration Statement, or any state securities commission or other
regulatory authority shall issue an order suspending the qualification or
exemption from qualification of the Transfer Restricted Securities under state
securities or Blue Sky laws, the Company and the Guarantors shall use all
commercially reasonable efforts to obtain the withdrawal or lifting of such
order at the earliest possible time;

(ad) subject to Section 6(d), if any fact or event contemplated by
Section 6(c)(iii)(D) above shall exist or have occurred, prepare a supplement or
post-effective amendment to the Registration Statement or related Prospectus or
any document incorporated therein by reference or file any other required
document so that, as thereafter delivered to the purchasers of Transfer
Restricted Securities, the Prospectus will not contain an untrue statement of a
material fact or omit to state any material fact necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading;

(ae) furnish to each Holder whose Transfer Restricted Securities have been
included in a Shelf Registration Statement (in the case of a Shelf Registration
Statement) in connection with such exchange, registration or sale, if any,
before filing with the Commission, copies of any Registration Statement or any
Prospectus included therein or any amendments or supplements to any such
Registration Statement or Prospectus (including all documents incorporated by
reference after the initial filing of such Registration Statement), which
documents will be subject to the reasonable review and comment of such Holders
in connection with such sale, if any, for a period of at least three Business
Days, and the Company will not file any such Registration Statement or

 

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Prospectus or any amendment or supplement to any such Registration Statement or
Prospectus (including all such documents incorporated by reference) to which
such Holders shall reasonably object within three Business Days after the
receipt thereof. A Holder shall be deemed to have reasonably objected to such
filing if such Registration Statement, amendment, Prospectus or supplement, as
applicable, as proposed to be filed, contains an untrue statement of a material
fact or omits to state any material fact necessary to make the statements
therein not misleading or fails to comply with the applicable requirements of
the Act;

(af) promptly prior to the filing of any document that is to be incorporated by
reference into a Registration Statement or Prospectus in connection with such
exchange, registration or sale, if any, provide copies of such document to each
Holder whose Transfer Restricted Securities have been included in a Shelf
Registration Statement (in the case of a Shelf Registration Statement) in
connection with such exchange, registration or sale, if any, make the Company’s
and the Guarantors’ representatives available for discussion of such document
and other customary due diligence matters, subject to execution and delivery of
customary confidentiality agreements, and include such information in such
document prior to the filing thereof as such Holders may reasonably request;

(ag) make available, at reasonable times, for inspection by each Holder whose
Transfer Restricted Securities have been included in a Shelf Registration
Statement (in the case of a Shelf Registration Statement) and any attorney or
accountant retained by such Holders, all financial and other records, pertinent
corporate documents of the Company and the Guarantors reasonably requested and
cause the Company’s and the Guarantors’ officers, directors and employees to
supply all information reasonably requested by any such Holder, attorney or
accountant in connection with such Registration Statement or any post-effective
amendment thereto subsequent to the filing thereof and prior to its
effectiveness; provided that any Holder or representative thereof requesting or
receiving such information shall agree to be bound by customary confidentiality
agreements and procedures with respect thereto;

(ah) if requested by any Holders whose Transfer Restricted Securities have been
included in a Shelf Registration Statement (in the case of a Shelf Registration
Statement) in connection with such exchange, registration or sale, promptly
include in any Registration Statement or Prospectus, pursuant to a supplement or
post-effective amendment if necessary, such information as such Holders may
reasonably request to have included therein, including, without limitation,
information relating to the “Plan of Distribution” of the Transfer Restricted
Securities and the use of the Registration Statement or Prospectus for market
making activities; and make all required filings of such Prospectus supplement
or post-effective amendment as soon as practicable after the Company is notified
of the matters to be included in such Prospectus supplement or post-effective
amendment;

 

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(ai) upon request, furnish to each Holder whose Transfer Restricted Securities
have been included in a Shelf Registration Statement (in the case of a Shelf
Registration Statement) in connection with such exchange, registration or sale,
without charge, at least one copy of the Registration Statement, as first filed
with the Commission, and of each amendment thereto, including all documents
incorporated by reference therein and all exhibits (including exhibits
incorporated therein by reference);

(aj) upon request, deliver to each Holder whose Transfer Restricted Securities
have been included in a Shelf Registration Statement (in the case of a Shelf
Registration Statement) without charge, as many copies of the Prospectus
(including each preliminary prospectus) and any amendment or supplement thereto
as such Holders reasonably may request; the Company and the Guarantors hereby
consent to the use (in accordance with law and subject to Section 6(d) hereof)
of the Prospectus and any amendment or supplement thereto by each selling Holder
in connection with the offering and the sale of the Transfer Restricted
Securities covered by the Prospectus or any amendment or supplement thereto;

(ak) upon the reasonable request of such Holder, enter into such agreements
(including an underwriting agreement containing customary terms), and make such
representations and warranties, and take all such other reasonable and customary
actions in connection therewith in order to expedite or facilitate the
disposition of the Transfer Restricted Securities pursuant to a Shelf
Registration Statement contemplated by this Agreement, all to such extent as may
be customarily and reasonably requested by any Holder or Holders of Transfer
Restricted Securities who hold at least 50% in aggregate principal amount of
such class of Transfer Restricted Securities; provided, that, the Company and
the Guarantors shall not be required to enter into any such agreement more than
once with respect to all of the Transfer Restricted Securities and may delay
entering into such agreement if the Board of Directors of the Company determines
in good faith that it is in the best interests of the Company and the Guarantors
not to disclose the existence of or facts surrounding any proposed or pending
material corporate transaction involving the Company and the Guarantors. In such
connection, the Company and the Guarantors shall:

(i) upon the request of any Holder, furnish (or in the case of paragraphs
(2) and (3), use its commercially reasonable efforts to cause to be furnished)
to each such Holder (in the case of the Shelf Registration Statement) and any
underwriter, upon the effectiveness of the Shelf Registration Statement, as the
case may be:

a certificate in customary form, dated such date, signed on behalf of the
Company and each Guarantor by (x) the Chief Executive Officer or any Vice
President, and (y) a principal financial or accounting officer of the Company
and such Guarantor, confirming, as of the date thereof, such matters as such
Holders may reasonably request;

 

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a customary opinion (including a customary negative assurance statement), dated
the date of effectiveness of the Shelf Registration Statement, as the case may
be, of counsel for the Company and the Guarantors in customary form and covering
such other matters as such Holder may reasonably request; and

a customary comfort letter, dated the date of effectiveness of the Shelf
Registration Statement, as the case may be, from the Company’s independent
accountants, in the customary form and covering matters of the type customarily
covered in comfort letters to underwriters in connection with underwritten
offerings, and affirming the matters set forth in the comfort letters delivered
pursuant to Section 8(e) of the Purchase Agreement; and

(ii) deliver such other documents and certificates as may be reasonably
requested by the selling Holders to evidence compliance with the matters covered
in clause (A) above and with any customary conditions contained in any agreement
entered into by the Company and the Guarantors pursuant to this clause (xi);

(al) prior to any public offering of Transfer Restricted Securities, cooperate
with the selling Holders and their counsel in connection with the registration
and qualification of the Transfer Restricted Securities under the securities or
Blue Sky laws of such jurisdictions as the selling Holders may request and do
any and all other acts or things necessary or advisable to enable the
disposition in such jurisdictions of the Transfer Restricted Securities covered
by the applicable Registration Statement; provided, however, that the Company
and the Guarantors shall not be required to register or qualify as a foreign
corporation where it is not now so qualified or to take any action that would
subject it to the service of process in suits or to taxation in any jurisdiction
where it is not now so subject;

(am) in connection with any sale of Transfer Restricted Securities that will
result in such securities no longer being Transfer Restricted Securities,
cooperate with the Holders to facilitate the timely preparation and delivery of
certificates representing Transfer Restricted Securities to be sold and not
bearing any restrictive legends; and to enable such Transfer Restricted
Securities to be registered in such denominations and such names as the selling
Holders may request at least two Business Days prior to such sale of Transfer
Restricted Securities;

(an) use all commercially reasonable efforts to cause the disposition of the
Transfer Restricted Securities covered by the Registration Statement to be
registered with or approved by such other governmental agencies or authorities
as may be necessary to enable the seller or sellers thereof to consummate the
disposition of such Transfer Restricted Securities, subject to the proviso
contained in clause (xii) above;

 

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(ao) provide a CUSIP number for all Transfer Restricted Securities not later
than the effective date of a Registration Statement covering such Transfer
Restricted Securities and provide the Trustee under the Indenture with
certificates for the Transfer Restricted Securities which are in a form eligible
for deposit with the Depository Trust Company; and

(ap) otherwise use all commercially reasonable efforts to comply with all
applicable rules and regulations of the Commission, and make generally available
to its security holders with regard to any applicable Registration Statement, as
soon as practicable, a consolidated earnings statement meeting the requirements
of Rule 158 under the Act (which need not be audited) covering a twelve-month
period beginning after the effective date of the Registration Statement (as such
term is defined in paragraph (c) of Rule 158 under the Act).

(d) Restrictions on Holders. Each Holder agrees by acquisition of a Transfer
Restricted Security that, upon receipt of the notice referred to in
Section 6(c)(i) or 6(c)(iii)(C) or any notice from the Company of the existence
of any fact of the kind described in Section 6(c)(iii)(D) hereof (in each case,
a “Suspension Notice”), such Holder will forthwith discontinue disposition of
Transfer Restricted Securities pursuant to the applicable Registration Statement
until (i) such Holder has received copies of the supplemented or amended
Prospectus contemplated by Section 6(c)(iv) hereof, or (ii) such Holder is
advised in writing by the Company that the use of the Prospectus may be resumed,
and has received copies of any additional or supplemental filings that are
incorporated by reference in the Prospectus (in each case, the “Recommencement
Date”). Each Holder receiving a Suspension Notice hereby agrees that it will
either (i) destroy any Prospectuses, other than permanent file copies, then in
such Holder’s possession which have been replaced by the Company with more
recently dated Prospectuses, or (ii) deliver to the Company (at the Company’s
expense) all copies, other than permanent file copies, then in such Holder’s
possession of the Prospectus covering such Transfer Restricted Securities that
was current at the time of receipt of the Suspension Notice. The time period
regarding the effectiveness of such Registration Statement set forth in
Section 3 or 4 hereof, as applicable, shall be extended by a number of days
equal to the number of days in the period from and including the date of
delivery of the Suspension Notice to the Recommencement Date.

 

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  7. REGISTRATION EXPENSES

All expenses incident to the Company’s and the Guarantors’ performance of or
compliance with this Agreement will be borne by the Company and the Guarantors,
regardless of whether a Registration Statement becomes effective, including
without limitation: (i) all registration and filing fees and expenses; (ii) all
fees and expenses of compliance with federal securities and state Blue Sky or
securities laws; (iii) all expenses of printing (including printing certificates
for the Exchange Notes to be issued in the Exchange Offer and printing of
Prospectuses), messenger and delivery services and telephone; (iv) the
reasonable fees and disbursements of counsel for the Company and the Guarantors,
and, in the case of a Shelf Registration Statement, the reasonable and
documented fees and disbursements of one counsel for all of the Holders of
Transfer Restricted Securities selected by the Holders of a majority in
principal amount of Transfer Restricted Securities being registered; (v) all
application and filing fees in connection with listing the Exchange Notes on a
national securities exchange or automated quotation system pursuant to the
requirements hereof; and (vi) all fees and disbursements of independent
certified public accountants of the Company and the Guarantors (including the
expenses of any special audit and comfort letters required by or incident to
such performance); provided, however, that in no event shall the Company or the
Guarantors be responsible for any underwriting discounts and commissions,
brokerage commissions and transfer taxes, and fees attributable to the sale or
other disposition of Transfer Restricted Securities.

The Company will, in any event, bear its and the Guarantors’ internal expenses
(including, without limitation, all salaries and expenses of its officers and
employees performing legal or accounting duties), the expenses of any annual
audit and the fees and expenses of any Person, including special experts,
retained by the Company or the Guarantors.

 

  8. INDEMNIFICATION

(a) The Company and the Guarantors agree, jointly and severally, to indemnify
and hold harmless each Holder, its directors, officers and each Person, if any,
who controls such Holder (within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act), from and against any and all losses, claims,
damages, liabilities or judgments, (including without limitation, any legal or
other expenses incurred in connection with investigating or defending any
matter, including any action that could give rise to any such losses, claims,
damages, liabilities or judgments) caused by any untrue statement or alleged
untrue statement of a material fact contained in any Registration Statement,
preliminary prospectus or Prospectus, Free Writing Prospectus or any “issuer
information” (as defined in Rule 433 of the Act) filed or required to be filed
pursuant to Rule 433(d) under the Act or in any amendment or supplement thereto,
or caused by any omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein, in
the light of the circumstances under which they were made, not misleading,
except insofar as such losses, claims, damages, liabilities or judgments are
caused by an untrue statement or omission or alleged untrue statement or
omission that is based upon information relating to any of the Holders furnished
in writing to the Company by or on behalf of any of the Holders.

 

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(b) Each Holder agrees, severally and not jointly, to indemnify and hold
harmless the Company and the Guarantors, and their respective directors and
officers, and each Person, if any, who controls (within the meaning of
Section 15 of the Act or Section 20 of the Exchange Act) the Company, or the
Guarantors to the same extent as the foregoing indemnity from the Company and
the Guarantors set forth in section (a) above, but only with reference to
information relating to such Holder furnished in writing to the Company and the
Guarantors by or on behalf of such Holder expressly for use in any Registration
Statement. In no event shall any Holder, its directors, officers or any Person
who controls such Holder be liable or responsible for any amount in excess of
the amount by which the total amount received by such Holder with respect to its
sale of Transfer Restricted Securities pursuant to a Registration Statement
exceeds the sum of: (i) the amount paid by such Holder for such Transfer
Restricted Securities plus (ii) the amount of any damages that such Holder, its
directors, officers or any Person who controls such Holder has otherwise been
required to pay by reason of such untrue or alleged untrue statement or omission
or alleged omission.

(c) In case any action shall be commenced involving any Person in respect of
which indemnity may be sought pursuant to Section 8(a) or 8(b) (the “indemnified
party”), the indemnified party shall promptly notify the Person against whom
such indemnity may be sought (the “indemnifying party”) in writing and the
indemnifying party shall assume the defense of such action, including the
employment of counsel reasonably satisfactory to the indemnified party and the
payment of all reasonable fees and expenses of such counsel, as incurred (except
that in the case of any action in respect of which indemnity may be sought
pursuant to both Sections 8(a) and 8(b), a Holder shall not be required to
assume the defense of such action pursuant to this Section 8(c), but may employ
separate counsel and participate in the defense thereof, but the fees and
expenses of such counsel, except as provided below, shall be at the expense of
the Holder). Any indemnified party shall have the right to employ separate
counsel in any such action and participate in the defense thereof, but the
reasonable fees and expenses of such counsel shall be at the expense of the
indemnified party unless (i) the employment of such counsel has been
specifically authorized in writing by the indemnifying party, (ii) the
indemnifying party has failed to assume the defense of such action or employ
counsel reasonably satisfactory to the indemnified party, or (iii) the named
parties to any such action (including any impleaded parties) include both the
indemnified party and the indemnifying party, and the indemnified party has been
advised by such counsel that there may be one or more legal defenses available
to it which are different from or additional to those available to the
indemnifying party (in which case the indemnifying party shall not have the
right to assume the defense of such action on behalf of the indemnified party).
In any such case, the indemnifying party shall not, in connection with any one
action or separate but substantially similar or related actions in the same
jurisdiction arising out of the same general allegations or circumstances, be
liable for the reasonable fees and expenses of more than one separate firm of
attorneys (in addition to any local counsel) for all indemnified parties and all
such fees and expenses shall be reimbursed as they are incurred. Such firm shall
be designated in writing by a majority of the Holders, in the

 

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case of the parties indemnified pursuant to Section 8(a), and by the Company and
Guarantors, in the case of parties indemnified pursuant to Section 8(b). The
indemnifying party shall indemnify and hold harmless the indemnified party from
and against any and all losses, claims, damages, liabilities and judgments by
reason of any settlement of any action effected with its written consent (which
consent shall not be unreasonably withheld). No indemnifying party shall,
without the prior written consent of the indemnified party (which consent shall
not be unreasonably withheld), effect any settlement or compromise of, or
consent to the entry of judgment with respect to, any pending or threatened
claim, action, suit or proceeding in respect of which the indemnified party is
or could have been a party and indemnity or contribution may be or could have
been sought hereunder by the indemnified party, unless such settlement,
compromise or judgment (i) includes an unconditional release of the indemnified
party from all liability on claims that are or could have been the subject
matter of such claim, action, suit or proceeding and (ii) does not include a
statement as to or an admission of fault, culpability or a failure to act, by or
on behalf of the indemnified party.

(d) To the extent that the indemnification provided for in this Section 8 is
unavailable to an indemnified party in respect of any losses, claims, damages,
liabilities or judgments referred to therein, then each indemnifying party, in
lieu of indemnifying such indemnified party, shall contribute to the amount paid
or payable by such indemnified party as a result of such losses, claims,
damages, liabilities or judgments (i) in such proportion as is appropriate to
reflect the relative benefits received by the Company and the Guarantors, on the
one hand, and the Holders, on the other hand, from their sale of Transfer
Restricted Securities, or (ii) if the allocation provided by clause 8(d)(i)
above is not permitted by applicable law, in such proportion as is appropriate
to reflect not only the relative benefits referred to in clause 8(d)(i) above
but also the relative fault of the Company and the Guarantors, on the one hand,
and of the Holder, on the other hand, in connection with the statements or
omissions which resulted in such losses, claims, damages, liabilities or
judgments, as well as any other relevant equitable considerations. The relative
fault of the Company and the Guarantors, on the one hand, and of the Holder, on
the other hand, shall be determined by reference to, among other things, whether
the untrue or alleged untrue statement of a material fact or omission or alleged
omission to state a material fact relates to information supplied by the Company
or such Guarantor, on the one hand, or by the Holder, on the other hand, and the
parties’ relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission. The amount paid or payable by a
party as a result of the losses, claims, damages, liabilities and judgments
referred to above shall be deemed to include, subject to the limitations set
forth in Section 8(c) hereof, any legal or other fees or expenses reasonably
incurred by such party in connection with investigating or defending any action
or claim.

(e) The Company, the Guarantors and each Holder agree that it would not be just
and equitable if contribution pursuant to this Section 8(d) were determined by
pro rata allocation (even if the Holders were treated as one entity for such
purpose) or by any other method of allocation that does not take account of the
equitable considerations referred to in the immediately preceding paragraph. The
amount paid or payable by an indemnified party as a result of the losses,
claims, damages, liabilities or judgments referred to in the immediately

 

18

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preceding paragraph shall be deemed to include, subject to the limitations set
forth above, any legal or other expenses reasonably incurred by such indemnified
party in connection with investigating or defending any matter, including any
action that could have given rise to such losses, claims, damages, liabilities
or judgments. Notwithstanding the provisions of this Section 8, no Holder, its
directors, its officers or any Person, if any, who controls such Holder shall be
required to contribute, in the aggregate, any amount in excess of the amount by
which the total amount received by such Holder with respect to the sale of
Transfer Restricted Securities pursuant to a Registration Statement exceeds the
sum of: (i) the amount paid by such Holder for such Transfer Restricted
Securities plus (ii) the amount of any damages that such Holder has otherwise
paid or become liable to pay by reason of any untrue or alleged untrue statement
or omission or alleged omission. No Person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any Person who was not guilty of such fraudulent
misrepresentation. The Holders’ obligations to contribute pursuant to this
Section 8(d) are several in proportion to the respective principal amount of
Transfer Restricted Securities held by each Holder hereunder and not joint.

 

  9. RULE 144A AND RULE 144

The Company and each Guarantor agrees with each Holder, for so long as any
Transfer Restricted Securities remain outstanding and during any period in which
the Company or such Guarantor is not subject to Section 13 or 15(d) of the
Exchange Act, to make available, upon request of any Holder, to such Holder or
beneficial owner of Transfer Restricted Securities in connection with any sale
thereof and any prospective purchaser of such Transfer Restricted Securities
designated by such Holder or beneficial owner, the information required by Rule
144A(d)(4) under the Act in order to permit resales of such Transfer Restricted
Securities pursuant to Rule 144A under the Act.

 

  10. MISCELLANEOUS

(a) Remedies. The Company and the Guarantors acknowledge and agree that any
failure by the Company and/or the Guarantors to comply with their respective
obligations under Sections 3 and 4 hereof may result in material irreparable
injury to the Initial Purchasers or the Holders for which there is no adequate
remedy at law, that it will not be possible to measure damages for such injuries
precisely and that, in the event of any such failure, the Initial Purchasers or
any Holder may obtain such relief as may be required to specifically enforce the
Company’s and the Guarantors’ obligations under Sections 3 and 4 hereof. The
Company and the Guarantors further agree to waive the defense in any action for
specific performance that a remedy at law would be adequate.

(b) Free Writing Prospectus. The Company represents, warrants and covenants that
it (including its agents and representatives) will not prepare, make, use,
authorize, approve or refer to any “written communication” (as defined in Rule
405 under the Securities Act) in connection with the issuance and sale of the
Initial Notes and the Exchange Notes, other than (i) any communication pursuant
to Rule 134, Rule 135 or Rule 135c under the Securities

 

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Act, (ii) any document constituting an offer to sell or solicitation of an offer
to buy the Initial Notes or the Exchange Notes that falls within the exception
from the definition of prospectus in Section 2(a)(10)(a) of the Securities Act,
or (iii) a prospectus satisfying the requirements of section 10(a) of the
Securities Act or of Rule 430, Rule 430A, Rule 430B, Rule 430C or Rule 431 under
the Securities Act.

(c) No Inconsistent Agreements. The Company and any Guarantor will not, on or
after the date of this Agreement, enter into any agreement with respect to its
securities that is inconsistent with the rights granted to the Holders in this
Agreement or otherwise conflicts with the provisions hereof. The Company and any
Guarantor have not previously entered into, nor is currently a party to, any
agreement granting any registration rights with respect to its securities to any
Person that would require such securities to be included in any Registration
Statement filed hereunder. The rights granted to the Holders hereunder do not in
any way conflict with and are not inconsistent with the rights granted to the
holders of the Company’s and the Guarantors’ securities under any agreement in
effect on the date hereof.

(d) Amendments and Waivers. The provisions of this Agreement may not be amended,
modified or supplemented, and waivers or consents to or departures from the
provisions hereof may not be given unless (i) in the case of Section 5 hereof
and this Section 10(d)(i), the Company has obtained the written consent of
Holders of all outstanding Transfer Restricted Securities, and (ii) in the case
of all other provisions hereof, the Company has obtained the written consent of
Holders of a majority of the outstanding principal amount of Transfer Restricted
Securities (excluding Transfer Restricted Securities held by the Company or its
Affiliates). Notwithstanding the foregoing, a waiver or consent to departure
from the provisions hereof that relates exclusively to the rights of Holders
whose Transfer Restricted Securities are being tendered pursuant to the Exchange
Offer, and that does not affect directly or indirectly the rights of other
Holders whose Transfer Restricted Securities are not being tendered pursuant to
such Exchange Offer, may be given by the Holders of a majority of the
outstanding principal amount of Transfer Restricted Securities subject to such
Exchange Offer.

(e) Additional Guarantors. The Company shall cause any of its Domestic
Subsidiaries (as defined in the Indenture) that becomes, prior to the
consummation of the Exchange Offer, a Guarantor in accordance with the terms and
provisions of the Indenture to become a party to this Agreement as a Guarantor.

(f) Third Party Beneficiary. The Holders shall be third party beneficiaries to
the agreements made hereunder between the Company and the Guarantors, on the one
hand, and the Initial Purchasers, on the other hand, and shall have the right to
enforce such agreements directly to the extent they may deem such enforcement
necessary or advisable to protect its rights or the rights of Holders hereunder.

(g) Notices. All notices and other communications provided for or permitted
hereunder shall be made in writing by hand-delivery, first-class mail
(registered or certified, return receipt requested), telex, telecopier or air
courier guaranteeing overnight delivery:

(aa) if to a Holder, at the address set forth on the records of the Registrar
under the Indenture, with a copy to the Registrar under the Indenture; and

 

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(ab) if to the Company or the Guarantors:

The Hillman Group

10590 Hamilton Avenue

Cincinnati, Ohio 45231-1764

Attention: Chief Financial Officer

Fax: 513-595-8297

With a copy to:

Paul, Weiss, Rifkind, Wharton & Garrison LLP

1285 Avenue of the Americas

New York, New York 10019

Attention: John C. Kennedy

Fax: 212-492-0025

All such notices and communications shall be deemed to have been duly given: at
the time delivered by hand, if personally delivered; five Business Days after
being deposited in the mail, postage prepaid, if mailed; when receipt
acknowledged, if telecopied; and on the next Business Day, if timely delivered
to an air courier guaranteeing overnight delivery.

Copies of all such notices, demands or other communications shall be
concurrently delivered by the Person giving the same to the Trustee at the
address specified in the Indenture.

(h) Successors and Assigns. This Agreement shall inure to the benefit of and be
binding upon the successors and assigns of each of the parties, including
without limitation and without the need for an express assignment, subsequent
Holders; provided that nothing herein shall be deemed to permit any assignment,
transfer or other disposition of Transfer Restricted Securities in violation of
the terms hereof or of the Purchase Agreement or the Indenture. If any
transferee of any Holder shall acquire Transfer Restricted Securities in any
manner, whether by operation of law or otherwise, such Transfer Restricted
Securities shall be held subject to all of the terms of this Agreement, and by
taking and holding such Transfer Restricted Securities such Person shall be
conclusively deemed to have agreed to be bound by and to perform all of the
terms and provisions of this Agreement, including the restrictions on resale set
forth in this Agreement and, if applicable, the Purchase Agreement, and such
Person shall be entitled to receive the benefits hereof.

(i) Counterparts. This Agreement may be executed in any number of counterparts
and by the parties hereto in separate counterparts, each of which when so
executed shall be deemed to be an original and all of which taken together shall
constitute one and the same agreement.

 

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(j) Headings. The headings in this Agreement are for convenience of reference
only and shall not limit or otherwise affect the meaning hereof.

(k) Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO THE
CONFLICT OF LAW RULES THEREOF.

(l) Severability. In the event that any one or more of the provisions contained
herein, or the application thereof in any circumstance, is held invalid, illegal
or unenforceable, the validity, legality and enforceability of any such
provision in every other respect and of the remaining provisions contained
herein shall not be affected or impaired thereby.

(m) Entire Agreement. This Agreement is intended by the parties as a final
expression of their agreement and intended to be a complete and exclusive
statement of the agreement and understanding of the parties hereto in respect of
the subject matter contained herein. There are no restrictions, promises,
warranties or undertakings, other than those set forth or referred to herein
with respect to the registration rights granted with respect to the Transfer
Restricted Securities. This Agreement supersedes all prior agreements and
understandings between the parties with respect to such subject matter.

(Signature Pages Follow.)

 

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IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first written above.

 

The Hillman Group, Inc. By:     Name:   James P. Waters Title:   Chief Financial
Officer

Hillman Investment Company

The Hillman Companies, Inc.

All Points Industries, Inc.

SunSub C Inc.

Serv-A-Lite Products, Inc.

By:     Name:   James P. Waters Title:   Chief Financial Officer

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BARCLAYS CAPITAL INC.

MORGAN STANLEY & CO. INCORPORATED

By:   BARCLAYS CAPITAL INC. By     Name:   Title:  

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SCHEDULE I

Guarantors

Hillman Investment Company

The Hillman Companies, Inc.

All Points Industries, Inc.

SunSub C Inc.

Serv-A-Lite Products, Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Schedule I-1

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ANNEX A

PLAN OF DISTRIBUTION

Each broker-dealer that receives exchange notes for its own account pursuant to
the exchange offer must acknowledge that it will deliver a prospectus in
connection with any resale of such exchange notes. This prospectus, as it may be
amended or supplemented from time to time, may be used by a broker-dealer in
connection with resales of exchange notes received in exchange for unregistered
notes where such unregistered notes were acquired as a result of market-making
activities or other trading activities. To the extent any such broker-dealer
participates in the exchange offer, we have agreed that for a period of up to
180 days we will use commercially reasonable efforts to make this prospectus, as
amended or supplemented, available to such broker-dealer for use in connection
with any such resale, and will deliver as many additional copies of this
prospectus and each amendment or supplement to this prospectus and any documents
incorporated by reference in this prospectus as such broker-dealer may
reasonably request.

We will not receive any proceeds from any sale of exchange notes by
broker-dealers. Exchange notes received by broker-dealers for their own accounts
pursuant to the exchange offer may be sold from time to time in one or more
transactions in the over-the-counter market, in negotiated transactions, through
the writing of options on the exchange notes or a combination of these methods
of resale, at market prices prevailing at the time of resale, at prices related
to such prevailing market prices or negotiated prices. Any such resale may be
made directly to purchasers or to or through brokers or dealers who may receive
compensation in the form of commissions or concessions from any such
broker-dealer or the purchasers of any such exchange notes. Any broker-dealer
that resells exchange notes that were received by it for its own account
pursuant to the exchange offer and any broker or dealer that participates in a
distribution of such exchange notes may be deemed to be an “underwriter” within
the meaning of the Securities Act and any profit on any such resale of exchange
notes and any commissions or concessions received by any such Persons may be
deemed to be underwriting compensation under the Securities Act. The letter of
transmittal states that by acknowledging that it will deliver and by delivering
a prospectus, a broker-dealer will not be deemed to admit that it is an
“underwriter” within the meaning of the Securities Act.

We have agreed to pay all expenses incident to the exchange offer and will
indemnify the holders of outstanding notes, including any broker-dealers,
against certain liabilities, including liabilities under the Securities Act.

--------------------------------------------------------------------------------

Exhibit B

Company Counsel Opinion

March 16, 2011

Barclays Capital Inc.

Morgan Stanley & Co. Incorporated

As Representatives of the several

    Initial Purchasers named in Schedule I attached hereto,

c/o Barclays Capital Inc.

745 Seventh Avenue

New York, New York 10019

Ladies and Gentlemen:

We have acted as special counsel to The Hillman Group, Inc., a Delaware
corporation (the “Company”), and the Guarantors referred to below in connection
with the Purchase Agreement, dated March 11, 2011, among the Initial Purchasers
named on Schedule I thereof (the “Initial Purchasers”), the Company and the
guarantors named on Schedule II thereof (the “Guarantors”) (the “Purchase
Agreement”), relating to the purchase today by the Initial Purchasers of
$50,000,000 aggregate principal amount of 10.875% Senior Notes due 2018 (the
“Notes”) of the Company. The Notes are to be issued under the Indenture, dated
as of May 28, 2010, among the Company, the Guarantors and Wells Fargo Bank,
National Association, as Trustee (the “Trustee”), as amended and supplemented by
the first supplemental indenture dated as of December 29, 2010 (as so
supplemented, the “Indenture”). This opinion is being furnished at the request
of the Company as contemplated by Section 7(b) of the Purchase Agreement.
Capitalized terms used and not otherwise defined in this letter have the
respective meanings given those terms in the Purchase Agreement.

 

1

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In connection with the furnishing of this opinion, we have examined originals,
or copies certified or otherwise identified to our satisfaction, of the
following documents:

 

  1. the Purchase Agreement;

 

  2. the Indenture (including the guarantees created therein (the
“Guarantees”));

 

  3. the Registration Rights Agreement, dated as of March 16, 2011 (the
“Registration Rights Agreement”), among the Company, the Guarantors and the
Initial Purchasers;

 

  4. the Notes issued on the date of this letter;

 

  5. the form of Exchange Note (the “Exchange Note”) attached as an Exhibit to
the Indenture (including the guarantees created therein (the “Exchange
Guarantees”));

 

  6. the Preliminary Offering Memorandum, dated March 11, 2011 (the “Preliminary
Offering Memorandum”);

 

  7. the Pricing Term Sheet, dated March 11, 2011 (the “Pricing Term Sheet” and
together with the Preliminary Offering Memorandum, the “Pricing Disclosure
Package”);

 

  8. the Offering Memorandum regarding the Notes, dated March 11, 2011 (the
“Final Memorandum”);

 

  9. the Acquisition Agreement, dated as of March 10, 2011 (the “Acquisition
Agreement”), by and between the Company and TagWorks, L.L.C.; and

 

  10. those documents incorporated by reference into the Final Memorandum set
forth on Schedule I hereto.

In addition, we have examined: (i) such corporate records of the Company and
each Guarantor listed on Schedule II hereto (each a “Delaware Guarantor”) that
we have considered appropriate, including a copy of the certificate of
incorporation, as amended, and by-laws, as amended, of the Company and each
Delaware Guarantor certified by the Company or such Delaware Guarantor as in
effect on the date of this letter (collectively,

 

2

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the “Charter Documents”) and copies of resolutions of the board of directors of
the Company and of each Delaware Guarantor relating to the issuance of the Notes
and the Guarantees, each certified by the Company and the Delaware Guarantors,
as applicable; and (ii) such other certificates, agreements and documents as we
deemed relevant and necessary as a basis for the opinions and beliefs expressed
below. We have also relied upon oral and written statements of officers and
representatives of the Company and the Delaware Guarantors, the factual matters
contained in the representations and warranties of the Company and the Delaware
Guarantors made in the Purchase Agreement and upon certificates of public
officials and the officers of the Company and the Delaware Guarantors. The
documents incorporated by reference into the Final Memorandum were prepared by
the Company without our participation.

In our examination of the documents referred to above, we have assumed, without
independent investigation, the genuineness of all signatures, the legal capacity
of all individuals who have executed any of the documents reviewed by us, the
authenticity of all documents submitted to us as originals, the conformity to
the originals of all documents submitted to us as certified, photostatic,
reproduced or conformed copies of valid existing agreements or other documents,
the authenticity of the latter documents and that the statements regarding
matters of fact in the certificates, records, agreements, instruments and
documents that we have examined are accurate and complete. We have also assumed,
without independent investigation, that (i) All Points Industries, Inc. and
Serv-A-Lite Products (the “Non-Delaware Guarantors”) are validly existing and in
good standing under the laws of their jurisdictions of organization, (ii) each
of the

 

3

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Non-Delaware Guarantors has all necessary corporate power and authority to
execute, deliver and perform its obligations under the Purchase Agreement, the
Registration Rights Agreement and the Indenture, (iii) the execution, delivery
and performance of the Purchase Agreement, the Registration Rights Agreement and
the Indenture have been duly authorized by all necessary corporate action of the
Non-Delaware Guarantors and do not violate the charter documents or other
organizational documents of the Non-Delaware Guarantors or the laws of their
respective jurisdictions of organization and (iv) the due execution and delivery
of the Purchase Agreement, the Registration Rights Agreement and the Indenture
by the Non-Delaware Guarantors under the laws of their respective jurisdictions
of organization. We have also assumed that you have complied with all of your
obligations and agreements arising under the Registration Rights Agreement, if
any, and that this agreement represents a valid and legally binding obligation
of yours, that the Indenture has been duly authorized and executed by, and
represents a valid and legally binding obligation of, the Trustee and the due
authentication of the Notes by the Trustee in the manner described in the
certificate of the Trustee delivered to you today.

Whenever we indicate that our opinion is based upon our knowledge or words of
similar import, our opinion is based solely on the actual knowledge of the
attorneys in this firm who are representing the Company in connection with the
Purchase Agreement and without any independent verification.

 

4

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Based upon the above, and subject to the stated assumptions, exceptions and
qualifications, we are of the opinion that:

1. Each of the Company and the Delaware Guarantors has been duly incorporated in
Delaware and is validly existing and in good standing under the laws of the
State of Delaware.

2. The Company has all necessary corporate power and authority to execute,
deliver and perform its obligations under the Purchase Agreement, the
Registration Rights Agreement, the Indenture, the Notes and the Exchange Notes
and to own and hold its properties and conduct its business as described in the
Pricing Disclosure Package and the Final Memorandum. Each Delaware Guarantor has
all necessary corporate power and authority to execute, deliver and perform its
obligations under the Purchase Agreement, the Registration Rights Agreement and
the Indenture (including, the Guarantees and the Exchange Guarantees) and to own
and hold its properties and conduct its business as described in the Pricing
Disclosure Package and the Final Memorandum.

3. The Notes have been duly authorized by the Company. The Notes, when duly
executed, issued and delivered by the Company against payment as provided in the
Purchase Agreement, will constitute valid and legally binding obligations of the
Company entitled to the benefits of the Indenture and enforceable against the
Company in accordance with their terms, except that the enforceability of the
Notes may be subject to bankruptcy, insolvency, reorganization, fraudulent
conveyance or transfer, moratorium or similar laws affecting creditors’ rights
generally and subject to general principles of equity (regardless of whether
enforceability is considered in a proceeding in equity or at law); and the
Notes, when issued and delivered, will conform in all material respects to the
description contained in the Pricing Disclosure Package and the Final Memorandum
under the caption “Description of Notes.”

 

5

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4. The Indenture has been duly authorized, executed and delivered by the Company
and each Delaware Guarantor. The Indenture (including the Guarantees by the
Guarantors therein) is a valid and legally binding obligation of the Company and
each Guarantor, enforceable against the Company and each Guarantor in accordance
with its terms, except that the enforceability of the Indenture may be subject
to bankruptcy, insolvency, reorganization, fraudulent conveyance or transfer,
moratorium or similar laws affecting creditors’ rights generally and subject to
general principles of equity (regardless of whether enforceability is considered
in a proceeding in equity or at law); and the Indenture conforms in all material
respects to its description contained in the Pricing Disclosure Package and the
Final Memorandum under the caption “Description of Notes.”

5. The Purchase Agreement has been duly authorized, executed and delivered by
each of the Company and the Delaware Guarantors.

6. The Registration Rights Agreement has been duly authorized, executed and
delivered by the Company and each Delaware Guarantor and assuming the due
authorization, execution and delivery thereof by the Initial Purchasers, is a
valid and legally binding obligation of the Company and each Guarantor,
enforceable against the Company and each Guarantor in accordance with its terms,
except that the enforceability of the Registration Rights Agreement may be
subject to bankruptcy, insolvency, reorganization, fraudulent conveyance or
transfer, moratorium or similar laws affecting

 

6

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creditors’ rights generally and subject to general principles of equity
(regardless of whether enforceability is considered in a proceeding in equity or
at law) and except to the extent that the indemnification and contribution
provisions of the Registration Rights Agreement may be unenforceable.

7. The Exchange Notes have been duly authorized by the Company.

8. The Exchange Guarantees have been duly authorized by each Delaware Guarantor.

9. The statements in the Final Memorandum under the heading “Certain United
States Federal Income Tax Considerations,” to the extent that they constitute
summaries of United States federal law or regulation or legal conclusions, have
been reviewed by us and fairly summarize the matters described under that
heading in all material respects.

10. Based upon the representations, warranties and agreements of the Company and
the Guarantors in Section 2(b) and Section 2(y) of the Purchase Agreement and of
the Initial Purchasers in Section 3(b) of the Purchase Agreement, it is not
necessary in connection with the offer, sale and delivery of the Notes
(including the Guarantees) to the Initial Purchasers under the Purchase
Agreement or in connection with the initial resale of the Notes (including the
Guarantees) by the Initial Purchasers in accordance with Section 3(b) of the
Purchase Agreement to register the Notes or the Guarantees under the Act, it
being understood that we express no opinion as to any subsequent resale of the
Notes.

 

7

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11. The issuance, execution, sale and delivery of the Notes by the Company, the
execution and delivery by the Company and each Guarantor of the Purchase
Agreement, the Registration Rights Agreement, the Indenture, the Exchange Notes
and the Acquisition Agreement (in each case to the extent it is a party thereto)
will not (i) result in a violation of the Charter Documents, (ii) breach or
result in a default under any agreement, indenture or instrument listed on
Schedule III to this opinion or (iii) violate Applicable Law or any judgment,
order or decree of any court or arbitrator known to us, except, in the case of
clauses (ii) and (iii) above, where the breach, default or violation could not
reasonably be expected to have a material adverse effect on the Company, the
Guarantors and their subsidiaries, taken as a whole. For purposes of this
letter, the term “Applicable Law” means the General Corporation Law of the State
of Delaware (the “GCL”) and those laws, rules and regulations of the United
States of America and the State of New York in each case which in our experience
are normally applicable to the transactions of the type contemplated by the
Purchase Agreement (other than the United States federal securities laws, any
state securities or Blue Sky laws of the various states, anti-fraud laws and the
rules and regulations of the Financial Industry Regulatory Authority, Inc.) but
without us having made any special investigation as to applicability of any
specific rule or regulation.

12. No consent, approval, authorization or order of, or filing, registration or
qualification with, any Governmental Authority, which has not been obtained,
taken or made is required by the Company and the Guarantors under any Applicable
Law for the issuance, sale and delivery of the Notes or the execution and

 

8

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delivery by the Company and the Guarantors of the Purchase Agreement, the
Registration Rights Agreement, the Indenture, the Exchange Notes and the
Acquisition Agreement, except as may be required in connection with the
registration of the Notes (including the Guarantees) and the Exchange Notes
(including the Exchange Guarantees) under the Registration Rights Agreement. For
purposes of this opinion, the term “Governmental Authority” means any executive,
legislative, judicial, administrative or regulatory body of the State of
New York, the State of Delaware or the United States of America.

13. The Company is not and, after giving effect to the offering and sale of the
Notes and the application of their proceeds as described in the Final Memorandum
under the heading “Use of Proceeds,” will not be required to be registered as an
investment company under the Investment Company Act of 1940, as amended, and the
rules and regulations of the Commission promulgated thereunder.

14. Except as otherwise disclosed in the Pricing Disclosure Package and the
Final Memorandum, to our knowledge, there are no legal proceedings pending or
overtly threatened against the Company or any of its subsidiaries which could
reasonably be expected to have a material adverse effect on the Company, the
Guarantors and their subsidiaries, taken as a whole.

The opinions expressed above are limited to the laws of the State of New York,
the GCL, and the federal laws of the United States of America. Our opinions are
rendered only with respect to the laws, and the rules, regulations and orders
under those laws, that are currently in effect.

 

9

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This letter is furnished by us solely for your benefit in connection with the
transactions referred to in the Purchase Agreement and may not be circulated to,
or relied upon by, any other person without our prior written consent.

 

Very truly yours, PAUL, WEISS, RIFKIND, WHARTON & GARRISON LLP

 

10

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Schedule I

Documents Incorporated by Reference

 

1. Annual Report on Form 10-K/A of The Hillman Companies, Inc. filed on May 4,
2010;

 

2. Quarterly Reports on Form 10-Q of The Hillman Companies, Inc. filed on
August 16, 2010 and November 15, 2010; and

 

3. Current Reports on Form 8-K of The Hillman Companies, Inc. filed on May 5,
2010, May 12, 2010, June 4, 2010, September 17, 2010, September 24,
2010, October 14, 2010 and January 7, 2011.

 

1

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Schedule II

Delaware Guarantors

The Hillman Companies, Inc.

Hillman Investment Company

SunSub C Inc.

 

1

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Material Agreements

 

1. Credit Agreement, dated as of March 31, 2004, by and among The Hillman
Companies, Inc., Hillman Investment Company, The Hillman Group, Inc., Merrill
Lynch Capital as Administrative Agent, Issuing Lender and Swingline Lender, JP
Morgan Chase Bank as Syndication Agent, and Merrill Lynch & Co., Merrill Lynch,
Pierce, Fenner & Smith Incorporated and JP Morgan Securities as Joint Lead
Arrangers and Joint Lead Bookrunners.

 

2. Subordination and Intercreditor Agreement, dated March 31, 2004, by and among
The Hillman Group, Inc., The Hillman Companies, Inc. and certain of its
subsidiaries, Allied Capital Corporation and Merrill Lynch Capital, as
Administrative Agent.

 

3. The Hillman Companies, Inc. 2004 Stock Option Plan, adopted on March 31,
2004.

 

4. The Hillman Companies, Inc. Amended and Restated 2004 Stock Option Plan,
adopted on December 2004.

 

5. The Hillman Companies, Inc. Employee Securities Purchase Plan, adopted on
March 31, 2004.

 

6. Hillman Investment Company Employee Securities Purchase Plan, adopted on
March 31, 2004.

 

7. HCI Securities Purchase Agreement, dated March 31, 2004, by and among Code
Hennessy & Simmons IV LP, HCI Acquisition Corp., Ontario Teachers’ Pension Plan
Board, HarbourVest Partners VI – Direct Fund, L.P. and each of the persons
listed on Schedule A thereto.

 

8. Joinder to Securities Purchase Agreement, dated March 31, 2004, by each of
Hillman Investment Company, The Hillman Group, Inc., SunSource Technology
Services LLC, The Hillman Group Canada Ltd., SunSub C, Inc., SunSub Holdings LLC
and SunSource Integrated Services de Mexico, SA.

 

9. Hillman Investment Company Securities Purchase Agreement, dated March 31,
2004, by and among Code Hennessy & Simmons IV LP, Hillman Investment Company,
Ontario Teachers’ Pension Plan Board, HarbourVest Partners VI – Direct Fund,
L.P. and each of the persons listed on Schedule A thereto.

 

10. Employment Agreement, dated March 31, 2004, by and between The Hillman
Group, Inc. and Max W. Hillman.

 

11. Executive Securities Agreement, dated March 31, 2004, by and between Max W.
Hillman and HCI Acquisition Corp.

 

12. Employment Agreement, dated March 31, 2004, by and between The Hillman
Group, Inc. and Richard P. Hillman, dated March 31, 2004.

 

13. Executive Securities Purchase Agreement, dated March 31, 2004, by and
between HCI Acquisition Corp. and Richard P. Hillman.

 

Annex A – Page 1

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14. Employment Agreement, dated March 31, 2004, by and between The Hillman
Group, Inc. and James P. Waters.

 

15. Executive Securities Agreement, dated March 31, 2004, by and between HCI
Acquisition Corp. and James P. Waters.

 

16. Executive Securities Agreement, dated March 31, 2004, by and between HCI
Acquisition Corp. and George L. Heredia.

 

17. Executive Securities Agreement, dated March 31, 2004, by and between HCI
Acquisition Corp. and Terry R. Rowe.

 

18. SunSource Inc. Nonqualified Deferred Compensation Plan, dated as of
August 1, 2000.

 

19. The Hillman Companies, Inc. Nonqualified Deferred Compensation Plan (amended
and restated), effective as of January 1, 2003.

 

20. First Amendment to The Hillman Companies, Inc. Nonqualified Deferred
Compensation Plan, as of March 30, 2004.

 

21. Asset Purchase Agreement, dated January 5, 2006, between The SteelWorks
Corporation and The Hillman Group, Inc.

 

22. Supply Agreement, dated January 5, 2006, between The SteelWorks Corporation
and The Hillman Group, Inc.

 

23. Amended and Restated Credit Agreement dated July 21, 2006, among The Hillman
Companies, Inc., Hillman Investment Company, The Hillman Group, Inc., the
lenders from time to time party hereto, Merrill Lynch Capital, JPMorgan Chase
Bank, and Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith
Incorporated and J.P. Morgan Securities Inc.

 

24. Amended and Restated Credit Agreement dated July 21, 2006, amended as of
August 7, 2009, among The Hillman Companies, Inc., Hillman Investment Company,
The Hillman Group, Inc., the lenders from time to time party hereto, GE Business
Financial Services Inc., JPMorgan Chase Bank, GE Capital Markets, Inc. and J.P.
Morgan Securities Inc.

 

25. Third Amendment to Loan Agreement dated May 6, 2009, among The Hillman
Companies, Inc., Hillman Investment Company, The Hillman Group, Inc., AEA
Mezzanine Fund II LP, AEA Mezzanine Fund II LLC, AEA Mezzanine (Unleveraged)
Fund LP, Connecticut General Life Insurance Company, Life Insurance Company of
North America, Dick & Betsy Devos Foundation, Vanderweide Family Foundation,
Douglas & Maria Devos Foundation, The Jerry & Marcia Tubergen Foundation, and GE
Business Financial Services Inc.

 

26. Fourth Amendment to Loan Agreement, dated August 7, 2009, among The Hillman
Companies, Inc., Hillman Investment Company, The Hillman Group, Inc., AEA
Mezzanine Fund II LP, AEA Mezzanine Fund II LLC, AEA Mezzanine (Unleveraged)
Fund LP, Connecticut General Life Insurance Company, Life Insurance Company of
North America, Dicky & Betsy Devos Foundation, Vanderweide Family Foundation and
GE Business Financial Services Inc.

 

Annex A – Page 2

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27. Amended and Restated Employment Agreement, dated December 21, 2008, by and
between The Hillman Group, Inc. and Max W. Hillman.

 

28. Amended and Restated Employment Agreement, dated December 21, 2008, by and
between The Hillman Group, Inc. and Richard P. Hillman.

 

29. Amended and Restated Employment Agreement, dated December 21, 2008, by and
between The Hillman Group, Inc. and James P. Waters.

 

30. Agreement and Plan of Merger, dated April 21, 2010, by and among OHCP HM
Acquisition Corp., OHCP HM Merger Sub Corp., The Hillman Companies, Inc. and the
Representatives named herein.

 

31. Employment Agreement, dated as of April 21, 2010, by and between The Hillman
Group, Inc. and Ali Fartaj.

 

32. Purchase Agreement, dated as of May 18, 2010, among OHCP HM Merger Sub Corp.
and the Initial Purchasers named therein.

 

33. Credit Agreement, dated as of May 28, 2010, among OHCP HM Acquisition Corp.
OHCP HM Merger Sub Corp., The Hillman Companies, Inc., Hillman Investment
Company, The Hillman Group, Inc., the lenders from time to time party hereto,
Barclays Bank PLC, as Administrative Agent, Issuing Lender and Swingline Lender,
Barclays Capital and Morgan Stanley Senior Funding, Inc., as Joint Lead
Arrangers and Syndication Agents, Barclays Capital, Morgan Stanley Senior
Funding, Inc. and GE Capital Markets, Inc. as Joint Bookrunnners and General
Capital Corporation, as Documentation Agent.

 

34. Borrower Assumption Agreement, dated as of June 1, 2010, among The Hillman
Companies, Inc., The Hillman Group, Inc. and Barclays Bank plc, as
Administrative and Collateral Agent.

 

35. Joinder Agreement, dated May 28, 2010, among The Hillman Group, Inc. and the
Guarantors party thereto.

 

36. Executive Letter Agreement, dated as of April 21, 2010, between The Hillman
Group, Inc. and Max W. Hillman, Jr.

 

37. Executive Letter Agreement, dated as of April 21, 2010, between The Hillman
Group, Inc. and Richard P. Hillman.

 

38. Executive letter Agreement, dated as of April 21, 2010, between The Hillman
Group, Inc. and James P. Waters.

 

39. Separation Agreement, dated as of September 28, 2010, between The Hillman
Group, Inc. and Ali Fartaj.

 

Annex A – Page 3