EX 10.4


SHARE
PURCHASE AGREEMENT



          
THIS SHARE PURCHASE AGREEMENT (“Agreement”) is made as of July 18, 2002,
by and among
OUTOKUMPU COPPER PRODUCTS OY, a Finnish
company (“Buyer”) and LGL Holland B.V., a private limited liability company
(besloten vennootschap met beperkte aansprakelijkheid) incorporated under the
laws of The Netherlands and having its official seat (statutaire zetel) in Amsterdam,
The Netherlands and its registered office at Watergoorweg 87, 3861MA
Nijkerk, the ,The Netherlands and registered with the Commercial Register under number
32069974 (“Seller”) and LGL EUROPE HOLDING CO.
(the “Guarantor”).


RECITALS



          
Seller desires to sell, and Buyer desires to purchase, shares in OUTOKUMPU HEATCRAFT B.V.,
a private limited liability company (besloten vennootschap
met beperkte aansprakelijkheid) to be incorporated by Seller under the laws
of The Netherlands and having its official seat (statutaire zetel) in
Amsterdam, (the “Company”) as hereinafter provided, for the
consideration and on the terms and conditions set forth in this Agreement.
Seller is a wholly-owned subsidiary of the Guarantor. 


AGREEMENT



          
Buyer, Seller and the Guarantor, intending to be legally bound, agree as follows:



1.     DEFINITIONS.



          
For purposes of this Agreement, the following terms have the meanings specified or
 referred to in this Section 1:



          
          
      
“Acquired Companies” -- the Company and the Heat Transfer Subsidiaries,
 collectively.



          
          
      
“Applicable Contract” -- any Contract (a) under which any Acquired
Company has or may acquire any rights, (b) under which any
Acquired Company has or may become subject to any obligation or liability, or (c) by
which any Acquired Company or any of the assets owned or used by it is
or may become bound.



          
          
      
“Balance Sheet” -- as defined in Section 3.4.



          
          
      
“Balance Sheet Net Assets” -- the combined net assets ((i) total
assets minus (ii) total liabilities other than Indebtedness) of
the Acquired Companies shown on the Base Balance Sheet calculated in accordance
with GAAP.



          
          
      
“Base Balance Sheet” -- means the unaudited balance sheet for the
Acquired Companies attached hereto as Schedule 1-A .









          
          
      
“Base Business Plan” --  means the initial base business plan of
the Company set forth as Attachment A to the Shareholders
Agreement.



          
          
      
“Best Efforts” -- the efforts that a prudent Person desirous of
achieving a result would use in similar circumstances to ensure
that such result with due consideration for timing where appropriate; provided, however,
that an obligation to use Best Efforts under this Agreement does
not require the Person subject to that obligation to take actions that would result
 in a materially adverse change in the benefits to such Person of this
Agreement and the Contemplated Transactions.



          
          
      
“Breach”  -- a “Breach” of a representation,
warranty, covenant, obligation or other provision of this Agreement or any instrument
delivered pursuant to this Agreement will be deemed to have occurred if there is or
has been  any inaccuracy in or breach of, or any failure to perform or
comply with such representation, warranty, covenant, obligation or other provision,
and the term “Breach” means any such inaccuracy, breach, failure,
claim, occurrence or circumstance.



          
          
      
“Business” -- consists of:


	
        (a)	
Subject to clause (b) and (c) below, Seller’s heat transfer business in
Europe, which includes its heat transfer division operations located in Cremieu,
France, Torreglia, Italy and Prague, Czech Republic. The Business includes all
plant, property, equipment and working capital presently used or useable in the
designated facilities; those licenses (including all licenses relating to the
software used in the Business), patent rights, trademarks and trade names used
in the Business (including Heatcraft), know-how, and other commercial or
proprietary information associated and/or necessary to conduct the Business as
presently conducted and foreseen, including all agreements with trade
representatives, agents, distributors engaged in marketing activities related to
the Business, with products currently manufactured by the Business; and the real
estate (including all rights to leaseholds) wherein the Business conducts its
manufacturing, distribution or administrative functions in the designated
facilities (collectively “Assets”);





	
        (b)	
With respect to Asia Pacific, (A) the Assets include certain idle manufacturing
equipment located at Lennox International, Inc.‘s Australian facility set
forth in Schedule A which shall be provided by Lennox on or before Closing (and
thereby attached to this Agreement) which equipment shall have an aggregate book
value of at least $ 100,000 and which will be moved to China (the “Kirby
Equipment”) and (B) with respect to the Singapore and Shanghai offices, the
Company will have the right to hire those employees of those offices who have
been primarily involved in the heat transfer business. In connection with
subpoint (A) above, the parties further agree that if additional idle equipment
is identified after Closing, such additional equipment shall be deemed to form
part of the Kirby Equipment up to the aggregate book value of $100,000 and
Seller undertakes at its own cost to assign and transfer them 






3[sic]




	
         	
        to the Company
        free of charge without encumbrances (as is, where is). So far as any additional
        idle equipment are identified in excess of the above referred additional $100,000
        book value, the Company shall have the option, but not the obligation,
        to acquire such idle equipment from the Seller at book value. 





	
        (c)	
        “Business” does not include (i) the heat transfer operations of Seller
        which are integrated into Seller’s other businesses, including its HVAC/R
        operations in Europe, Australia/New Zealand and the United States or (ii)
        Seller’s interest in Frigus-Bohn S.A. de C.V or, for clarification
        purposes, Sellers’s interest in its joint venture company in Brazil,
        Heatcraft do Brasil Ltda. 




          
          
      
“Business Day” -- means a day (other than a Saturday or Sunday)
on which banks in both New York, New York (USA) and Helsinki,
Finland are open for general business.



          
          
      
“Buyer” -- as defined in the first paragraph of this
Agreement.



          
          
      
“Buyer’s Accountants” -- PricewaterhouseCoopers LLP.



          
          
      
“Closing” -- as defined in Section 2.3.



          
          
      
“Closing Date” -- the date and time as of which the Closing actually
takes place.



          
          
      
“Closing Date Net Assets” -- the combined net assets (total
assets minus (ii) total liabilities other than any Indebtedness) of the
Acquired Companies as of the Closing Date calculated in accordance with GAAP.



          
      
          
“Company” -- as defined in the Recitals of this Agreement.



          
          
      
“Company’s Articles of Association” -- the Articles of Association
of the Company, the form of which is attached to the
Shareholders Agreement as .



          
          
      
“Competition Law” -- Any Legal Requirement intended to prohibit
or regulate mergers, restraints of trade or monopolization of
trade, including the HSR Act and Council Regulation (EEC) No. 4064/89 or similar
laws within Finland or other applicable jurisdictions including France,
Italy and the Czech Republic.



          
          
      
“Consent” -- any approval, consent, ratification, waiver, or other
 authorization (including any Governmental Authorization).



          
          
      
“Contemplated Transactions” -- all of the transactions contemplated
by this Agreement, including:


(a)
     the sale of the Shares by Seller to Buyer;




4





[sic](d)
          
     the JV Transactions;



(e)
          
             
        the performance by Buyer and Seller of their respective covenants and obligations
        under this Agreement; and



(f)
                  
     
The Company’s
exercise of 100% control over the Heat Transfer Subsidiaries including the
transactions provided for in Section 6.1. 



          
          
      
“Contract” -- any agreement, contract, obligation, promise or
undertaking (whether written or oral and whether express or implied)
that is legally binding.



          
          
      
“Damages” -- as defined in Section 10.1.



          
          
      
“Deed of Transfer”--the notarial deed of transfer attached hereto
as Schedule 1-D.



          
          
      
“Dutch Notary”--a Dutch notary to be mutually appointed by the
parties prior to Closing.



          
          
      
“Effective Time” - 11:59:59 p.m. on the Closing Date.



          
          
      
“Encumbrance” -- any charge, claim, community property interest,
condition, equitable interest, lien, option, pledge, security
interest, right of first refusal or any restriction on use, voting, transfer, receipt
of income or exercise of any other attribute of ownership other than
pursuant to the Company's Articles of Association.



          
          
      
“Environment” -- soil, land surface or subsurface strata, surface
waters (including navigable waters, ocean waters, streams, ponds,
drainage basins and wetlands), groundwaters, drinking water supply, stream sediments,
ambient air (including indoor air), plant and animal life and any
other environmental medium or natural resource.



          
          
      
“Environmental, Health and Safety Liabilities” -- any cost, damages,
expense, liability, obligation or other responsibility arising
from the requirements for compliance with or arising from the violation of  any
applicable Environmental Law or Occupational Safety and Health Law and
consisting of or relating to:



          
      
          (a)
     any actions required to
be taken to comply with applicable law or regulation relating to environmental,
health or safety matters or conditions (including on-site or off-site
contamination, occupational safety and health and regulation of chemical
substances or products); 



          
      
          (b)
      fines, penalties,
judgments, awards, settlements, legal or administrative proceedings, damages,
losses, claims, demands and response, investigative, remedial or inspection
costs and expenses resulting from any requirements under Environmental Law or
Occupational Safety and Health Law; 



5





          
          
       
(c)     
        financial
        responsibility under Environmental Law or Occupational Safety and Health Law for
        cleanup costs or corrective action, including any investigation, cleanup,
        removal, containment or other remediation or response actions
        (“Cleanup”) required by applicable Environmental
        Law or Occupational Safety and Health Law (whether or not such Cleanup has been
        required or requested by any Governmental Body or any other Person) with
        authority to require such Cleanup; or 



          
       
          
(d)     
        any other compliance,
        corrective, investigative or remedial measures required under the applicable
        Environmental Law or Occupational Safety and Health Law. 



          
       
          
“Environmental Law” -- any Legal Requirement that requires:



	
        (a)	
        advising appropriate authorities, employees and the public of intended or actual
        releases of pollutants or hazardous substances or materials, violations of
        discharge limits or other prohibitions and of the commencements of activities,
        such as resource extraction or construction, that could have significant impact
        on the Environment;





	
        (b)	
        preventing or reducing to acceptable levels the release of pollutants or
        hazardous substances or materials into the Environment;





	
        (c)	
        reducing the quantities, preventing the release or minimizing the hazardous
        characteristics of wastes that are generated;





	
        (d)	
        assuring that products are designed, formulated, packaged and used so that they
        do not present unreasonable risks to human health or the Environment when used
        or disposed of; 





	
        (e)	
        protecting resources, species or ecological amenities;





	
        (f)	
        reducing to acceptable levels the risks inherent in the transportation of
        hazardous substances, pollutants, oil or other potentially harmful
        substances;





	
        (g)	
        cleaning up pollutants that have been released, preventing the threat of release,
        or paying the costs of such clean up or prevention; or





	
        (h)	
        making responsible parties pay private parties, or groups of them, for damages
        done to their health or the Environment, or permitting self-appointed
        representatives of the public interest to recover for injuries done to public
        assets.






          
          
       
“Facilities” -- any real property, leaseholds or other interests
currently or formerly owned or operated by Seller or any Related Person thereof
and any buildings, structures or equipment (including motor vehicles, tank cars
and rolling stock) currently or formerly owned or operated by Seller or any Related
Person thereof for which Buyer or any of the Acquired Companies could have any legal
liability under Environmental Law. 



6





          
          
       
“GAAP” -- generally accepted United States accounting principles,
applied on a basis consistent with the basis on which the Balance Sheet and the
other financial statements referred to in Section 3.4 were prepared.



          
          
       
“Governmental Authorization” -- any approval, consent, license,
permit, waiver or other authorization issued, granted, given or
otherwise made available by or under the authority of any Governmental Body or
pursuant to any Legal Requirement.



          
       
          
“Governmental Body” -- any:


	
        (a)	
        nation, state, county, city, town, village, district
        or other jurisdiction of any nature;





	
        (b)	
        federal, state, local, municipal, foreign or other government;
        





	
        (c)	
         governmental or quasi-governmental authority of any nature (including any governmental agency, branch, department, official or entity and any
        court or other tribunal);





	
        (d)	
        multi-national organization or body; or





	
        (e)	
        body exercising, or entitled to exercise, any administrative, executive,
        judicial, legislative, police, regulatory or taxing authority or power of any
        nature. 






          
          
       
“Guarantor”-- as defined in the first paragraph of this Agreement.



          
          
       
“Hazardous Activity” -- the distribution, generation, handling, importing, management, manufacturing, processing, production,
refinement, Release,
storage, transfer, transportation, treatment or use (including any withdrawal or
other use of groundwater) of Hazardous Materials in, on, under, about or from
the Facilities or any part thereof, and any other act, business, operation or
thing that increases the danger, or risk of danger, or poses an unreasonable
risk of harm to persons or property or the Environment on or off the Facilities. 



          
          
       
“Hazardous Materials” -- any waste or other substance that is listed,
defined, designated or classified as, or otherwise determined
to be, hazardous, radioactive or toxic or a pollutant or a contaminant under or pursuant
to any Environmental Law, including any admixture or solution
thereof, and specifically including petroleum and all derivatives thereof or synthetic
substitutes therefore and asbestos or asbestos-containing materials.



          
          
       
“Heat Transfer Existing Subsidiaries” - the direct and indirect,
wholly or partially owned, subsidiaries of Seller in existence as
of December 31, 2001 and through which the Business has been operated.



          
          
       
“Heat Transfer Subsidiaries” - the Persons formed or to be formed
that, in addition to the Company, are listed on Schedule 3.1(a).



7





          
          
       
“Indebtedness” -- without duplication with respect to any Person,
(a) all indebtedness of such Person for borrowed money (including all accrued interest
and accumulated amortization), (b) all obligations of such Person for the deferred
purchase price of property or services (other than trade payables created in the
Ordinary Course of Business), (c) all indebtedness created or arising under any
conditional sale or other title retention agreement with respect to property acquired
by such Person (even though the rights and remedies of the seller or lender under
such agreement in the event of default are limited to repossession or sale of such
property), (d) all obligations of such Person as lessee under leases that have been
in accordance with GAAP, recorded as capital leases, (e) all obligations, contingent
or otherwise, of such Person under acceptance, letter of credit or similar facilities,
that have been in accordance with GAAP, recorded as indebtedness, and (f) Indebtedness
of others referred to in clauses (a) through (e) above guaranteed in any manner by
such Person, or in effect guaranteed by such Person under or pursuant to one or
more Contracts.



          
          
       
“Independent Accountants” - Ernst & Young, LLP




          
          
       
“Intellectual Property Assets”  -- as defined in Section 3.22.



          
          
       
“Interim Closing Period” -- the period beginning as of the Effective
Time and continuing through and ending on the Closing Date.



          
          
       
“JV Closings” -- the completion and consummation of the JV
Transactions as provided for in the Shareholders Agreement.



          
          
       
“JV Transactions” -- the Contracts and actions provided for, and as defined, in
the Shareholders Agreement and Joint Venture and
Member's Agreement with respect to USJVCO.



          
          
       
“Key Executives” -- the individuals listed on Schedule 1-B.




          
          
       
“Knowledge” -- an individual will be deemed to have “Knowledge”
of a particular fact or other matter if:



		
             (a)	
        such individual is actually aware of such fact or
        other matter; or






		
             (b)	
        a prudent individual could be expected to discover or otherwise become aware of
        such fact or other matter in the course of conducting a reasonably comprehensive
        investigation concerning the existence of such fact or other matter. 





A Person (other than an
individual) will be deemed to have “Knowledge” of a particular fact or
other matter if any individual who is serving, or who has at any time served, as
a director, officer or partner of such Person or any subsidiary thereof (or in
any similar capacity) has, or at any time had, Knowledge of such fact or other
matter. Notwithstanding the foregoing, “Knowledge” of Seller means the
knowledge of the officers and directors of Seller, the Acquired Companies and
the Heat Transfer Existing Subsidiaries; the management team members of Seller
in Dallas, Texas listed on 



8





Schedule 1-C and of Heatcraft Inc. in Grenada,
Mississippi and Livernois Engineering Inc. in Dearborn Michigan listed on
Schedule 1-D; and the management team members for Seller’s heat transfer
operations in Europe, and the directors of such subsidiaries, listed on Schedule
1-E. 



          
          
       
“Legal Requirement” -- any federal, state, local, municipal, foreign,
 international, multinational or other administrative order, constitution, law,
ordinance, principle of common law, regulation, statute or treaty applicable to any
of the Acquired Companies.



          
          
       
“Net Assets Adjustment” -- the amount by which (a) the Closing Date
Net Assets are greater (the "Positive Net Assets Adjustment")
or less (the "Negative Net Assets Adjustment") than (b) the Balance Sheet Net
Assets.



          
          
       
“Occupational Safety and Health Law” -- any Legal Requirement
designed to provide safe and healthful working conditions and to
reduce occupational safety and health hazards.



          
          
       
“Order” -- any award, decision, injunction, judgment, order, ruling,
subpoena or verdict entered, issued, made or rendered by any
court, administrative agency or other Governmental Body or by any arbitrator.



          
          
       
“Ordinary Course of Business” -- an action taken by a Person will
be deemed to have been taken in the "Ordinary Course of Business"
if such action is consistent with the past practices of such Person and is taken in
the ordinary course of the normal day-to-day operations of such Person.



          
          
       
“Organizational Documents” -- (a) the articles or certificate or
deed of incorporation, shareholders register and the bylaws of a
corporation, (b) the
partnership agreement and any statement of partnership of a general partnership,
(c) the limited partnership agreement and the certificate of limited
partnership of a limited partnership, (d) the certificate or deed of
formation and limited liability company agreement, articles of association,
memorandum of association or operating agreement and shareholders register of a
limited liability company, (e) any charter or similar document adopted or
filed in connection with the creation, formation or organization of a Person,
and (f) any amendment to or restatement of any of the foregoing. 



          
          
       
“Permitted Indebtedness” - any Indebtedness of the Acquired Companies
 incurred after the Effective Time which has been approved in
writing by Buyer.



          
          
       
“Person” -- any individual, corporation (including any non-profit
corporation), general or limited partnership, limited liability company, joint venture,
estate, trust, association, organization, labor union or other entity or
Governmental Body.



          
          
       
“Plan” -- as defined in Section 3.13.



9





          
          
       
Proceeding -- any action, arbitration, audit, hearing, investigation, litigation
or suit (whether civil, criminal, administrative, investigative or informal)
commenced, brought, conducted or heard by or before, or otherwise involving, any
Governmental Body or arbitrator.



          
          
       
“Related Person” -- with respect to a particular individual:


		
             (a)	
        each other member of such individual's immediately family(including spouse, parents
        and children, natural or adopted) (the "Family");





		
             (b)	
        any Person that is directly or indirectly controlled by such individual or one or
        more members of such individual's Family.






With respect to a specified Person other than an individual:


		
             (c)	
 any Person that directly or indirectly controls, is directly or indirectly
controlled by, or is directly or indirectly under common control with such
specified Person; 





		
             (d)	
 any Person that holds a Material Interest in such specified Person; and







		
             (e)	
        any Person with respect
        to which such specified Person serves as a general partner or a trustee (or in a
        similar capacity). 






          
          
       
“Release” -- any spilling, leaking, emitting, discharging,
depositing, escaping, leaching, dumping or other releasing into the
Environment, whether intentional or unintentional.



          
          
       
“Representative” -- with respect to a particular Person,
any director, officer, employee, agent, consultant, advisor or other
representative of such Person, including legal counsel, accountants and financial
advisors which has been designated by a Person and acknowledged by the
other Party which are limited in number to those reasonably necessary to accomplish
the required activities under this Agreement.



          
          
       
“Search Expenses” -- the fees and expenses incurred by Buyer or
its Related Person in connection with environmental searches and investigations
reasonably incurred by or on behalf of Buyer (but excluding the fees of Buyer's
 attorneys).



          
          
       
“Securities Act” -- the United States Securities Act of 1933
or any successor law, and regulations and rules issued pursuant to
that Act or any successor law.



          
          
       
“Seller” -- as defined in the first paragraph of this
Agreement.



          
          
       
“Seller’s Accountants” -- KPMG, LLP.



10





          
          
       
“Seller’s Release” -- as defined in Section 2.4.



          
          
       
“Shared Services Agreement” -- an agreement between the Company,
US JVCo and Seller in the form attached to the Joint Venture
Agreement as Attachment I pursuant to which (a) Seller and/or its Related
Persons shall provide certain transition services to the Company, US JVCo and the
other Acquired Companies and (b) the Company will provide certain services to Advanced
Distributor Products LLC, an affiliate of Seller.



          
          
       
“Shares” - 100 % of the Class A share, constituting 55% of all
outstanding shares in the Company, together with all rights
attaching or accruing thereto.



          
          
       
“Shareholders  Agreement” -- the  Shareholders’ Agreement
among Buyer, OCP, Seller, dated 18 July, 2002.



          
          
       
“Subsidiary” -- with respect to any Person (the “Owner”),
any corporation or other Person of which securities or other interests
having the power to elect a majority of that corporation’s or other Person’s
board of directors or similar governing body are held by the Owner or one or
more of its Subsidiaries; when used without reference to a particular Person,
“Subsidiary” means a Subsidiary of the Company.



          
          
       
“Tax” and “Taxes” -- any federal,
state, local or foreign
income, gross receipts, license, payroll, employment, excise, severance,
stamp, occupation, premium, windfall profits, environmental, customs duties,
capital stock, franchise, profits, withholding, social security (or similar),
unemployment, disability, real property, personal property, sales, use, transfer,
transfer pricing, registration, value added, alternative or add-on
minimum, estimated or other tax of any kind whatsoever applicable to any of the
Acquired Companies, including any interest, penalty or addition thereto,
whether disputed or not.



          
          
       
“Tax Return” -- any return (including any information return),
report, statement, schedule, notice, form or other document or
information required to be filed with or submitted to, any Governmental Body in
connection with the determination, assessment, collection or payment of any
Tax or in connection with the administration, implementation or enforcement of or
compliance with any Legal Requirement relating to any Tax.



          
          
       
“Threat of Release” -- a substantial likelihood of a Release
 that may require action in order to prevent or mitigate damage to the
Environment that may result from such Release.



          
          
       
“Threatened” -- a claim, Proceeding, dispute, action or other matter
will be deemed to have been "Threatened" if any demand or statement has been made
(orally or in writing) or any notice has been given (orally or in writing), or if any
other event has occurred or any other
circumstances exist, that would lead a prudent Person with adequate Knowledge of all of
the relevant facts to conclude that such a claim, Proceeding,
dispute, action or other matter is likely to be asserted, commenced, taken or otherwise
pursued in the future.



11






          
          
       
“Transaction Expenses” -- all fees, costs, expenses and disbursements,
incurred by Seller and the Acquired Companies, in connection
with the Contemplated Transactions, including: (a) the fees and expenses of any counsel
 retained by Seller, (b) the fees and expenses of any investment or
financial advisors retained by Seller or any Acquired Company, (c) the fees and expenses
of Seller's Accountants, (d) any amounts payable in accordance
with Section 10.4.3, (e) any incentive bonuses payable to the management, and any severance
or similar payments payable to any employee, of any of the
Acquired Companies in connection with the transactions contemplated hereby, (f) Seller's
share of the fees and expenses of the Independent Accounting Firm,
if any, and (g) any fees and expenses of any other counsel, accountants or other similar
professionals with respect to services rendered to Seller or the
Acquired Companies in connection with the transactions contemplated by this Agreement and
(h) one-half of Buyer's Search Expenses.



          
          
       
“US Share Purchase Agreement” -- the Share Purchase Agreement to be
entered into as of the date hereof by and between LENNOX
INTERNATIONAL, INC. AND OUTOKUMPU COPPER HOLDINGS INC and OUTOKUMPU COPPER OY with
respect to the purchase by OUTOKUMPU COPPER HOLDINGS INC (or its Related
Person) of 55% of the Shares (as defined therein) of OUTOKUMPU HEATCRAFT USA LLC
(“US JVCo”).



2.       
SALE AND TRANSFER OF SHARES; CLOSING.


	
        2.1	
        SHARES. Subject to the terms and conditions of this
        Agreement, Seller hereby sells the Shares to Buyer, and Buyer hereby purchases
        the Shares from Seller. 





2.2     
CONSIDERATION.



		
                  
             
        (a)     
        The total consideration payable by Buyer for the purchase of the Shares (the
        “Purchase Price”) shall be (i) $9,680,000
        minus (ii) any Indebtedness other than Permitted Indebtedness of the
        Acquired Companies that Seller shall not have repaid in full pursuant to Section
        6.3 (b) that is outstanding as of the Closing Date (including the unpaid
        principal, accrued and unpaid interest, any premium (including any prepayment
        penalties or other charges payable by reason of the prepayment of such
        Indebtedness on the Closing Date) and other charges payable in connection
        therewith) and (iii) either (A) plus 55% of the Positive Net Assets
        Adjustment or (B) minus 55% of the Negative Net Assets Adjustment.
        





		
                  
             
        (b)     
        At least three (3) Business Days prior to the Closing Date, the chief financial
        officer of Seller shall certify in writing to Buyer the estimated amount of the
        Indebtedness, Permitted Indebtedness, Closing Date Net Assets and, based
        thereon, a preliminary calculation of the Net Assets Adjustment and the
        adjustment for 






12




	
                  
        	
        Indebtedness. As soon as practicable prior to the Closing Date
        and based on the certification referred to above, Buyer and Seller shall jointly
        calculate the amount of the Purchase Price to be paid at Closing subject to
        adjustment as provided for in Section 2.2(c) (the “Preliminary
        Purchase Price”). The Closing shall occur and the payments
        to be made at Closing as provided for in Section 2.4 shall be based upon
        the notice provided for herein, and upon such joint calculations. 






		
                  
             
        (c)     
        As promptly as possible and in any event, not later than 30 days after the
        Closing, the Company, under the direction of Buyer after consultation with
        Seller, shall prepare and deliver initially to Buyer and Buyer’s
        Accountants (i) financial statements of the Company including a
        consolidated balance sheet (the “Closing Balance Sheet”) and an income
        statement with consolidating schedule of the Acquired Companies as of the
        Closing Date in accordance with GAAP which shall be subject to an audit or
        review by Buyer’s Accountants and (ii) a supplemental report setting
        forth the Indebtedness, the Permitted Indebtedness, Closing Date Net Assets and,
        based thereon, the Net Assets Adjustment (identified as either the Positive Net
        Assets Adjustment or the Negative Net Assets Adjustment), and the adjustment for
        Indebtedness (the “Closing Adjustments”), each of
        which shall be reported on by Buyer’s Accountants (the “Closing
        Date Financial Report”). The Closing Date Financial Report
        shall reflect a physical inventory conducted in accordance with subsection (e)
        of this Section 2.2. with any necessary adjustments required to reflect any
        changes from the date of inventory and the Closing Date. Any third-party
        expenses or fees incurred by Company in preparing or in connection with the
        Closing Date Financial Report and the Closing Adjustment (including the fees of
        Buyer’s Accountants) shall be borne by the Company. The Company and
        Buyer’s Accountants shall make available any work papers or other
        information relating to the Closing Date Financial Report then or thereafter
        requested by Seller. Any expenses incurred by Seller’s Accountants in
        reviewing the Closing Date Financial Report, such work papers and other
        information and in providing Seller with its report thereon shall be borne by
        the Company. If Seller does not object, or otherwise fails to respond, to the
        Closing Date Financial Report within 30 days after delivery to Seller, such
        Closing Date Financial Report shall automatically become final and conclusive.
        In the event that Seller objects to the Closing Date Financial Report within
        such 30 day review period, Seller and Buyer shall promptly meet and endeavor to
        reach agreement as to the content of the Closing Date Financial Report. If
        Seller and Buyer agree on the content of the Closing Date Financial Report, such
        Closing Date Financial Report shall become final and conclusive. If Seller and
        Buyer are unable to reach agreement within 30 days after the end of
        Seller’s 30 day review period, then the Independent Accountants shall
        promptly be retained to undertake a determination of the Closing Date Financial
        Report, which determination shall be made as






13




	 	
        quickly as possible (it being
        understood that the parties shall direct the Independent Accountants to complete
        their work within 30 days). Only disputed items shall be submitted to the
        Independent Accountants for review. In resolving any disputed item, the
        Independent Accountants may not assign a value to such item greater than the
        greatest value for such item claimed by either party or less than the lowest
        value for such item claimed by either party, in each case as presented to the
        Independent Accountants. Such determination of the Independent Accountants shall
        be final and binding on Seller and Buyer, and all expenses of the Independent
        Accountants shall be borne equally by Seller and Buyer. The Purchase Price and
        the payments required to be made after the Closing Date pursuant to
        Section 2.2(d) shall be finally determined on the basis of the Closing Date
        Financial Report and the Closing Adjustment. 






		
             
                  
        (d) 
        Within five (5) Business Days after the final determination of the Closing
        Adjustments, Buyer or Seller, as the case may be, shall pay to the other the
        amount by which the Purchase Price, as adjusted by the Closing Adjustments, is
        greater or less than the Preliminary Purchase Price (such difference being the
        “Closing Purchase Price Reconciliation”). If the
        Closing Purchase Price Reconciliation is positive, Buyer shall pay such
        difference to Seller. If the Closing Purchase Price Reconciliation is negative,
        Seller shall pay such difference to Buyer. If (i) Buyer fails to pay any amount
        owing to Seller pursuant to this subsection (d) or (ii) Seller fails to pay any
        amount owing to Buyer pursuant to this subsection (d), within the specified five
        (5) Business Day period, then the amount so owing shall be payable on demand and
        interest shall accrue on the unpaid amount at the rate of 18% per annum. 





		
             
                  
        (e) 
        In connection with the Purchase Price Reconsiliation referred to in this Section
        2.2 above, Parties shall further agree that if the book value of the Kirby
        Equipment falls below $100,000 as specified in Article 1 (the
        “Business” definition clause) above, the final Purchase Price shall be
        reduced by the difference between $100,000 and the actual book value of the
        Kirby Equipment listed on Schedule A. 





		
             
                  
        (f) 
        The
        target date for the physical inventory referred to in subsection (c) above is
        August 24, 2002, except for Italy, which is on or about August 10, 2002. Buyer
        agrees to notify Seller by August 2, 2002 if it appears that the approval of the
        European Commission will not be received by August 22, 2002, in which case the
        date of the physical inventory will be postponed by mutual agreement of the
        parties to a date that is closer to the Closing Date but in no event earlier
        than 35 days prior to a new target Closing Date. The physical inventory will be
        taken as by the employees of the Acquired Companies under the direction of
        Buyer, after consultation with Seller who shall have the right to be present
        thereat.(g) If any Accounts Receivable that are included in the 






14




	         
         	
        Closing Balance
        Sheet and taken into account in calculating the Net Assets Adjustment are not
        collected in full within later of 180 days after the Closing or 90 days after
        the due date (the aggregate amount of any such uncollected Accounts Receivable
        less any reserve for doubtful accounts being herein referred to as the
        “Shortfall Amount”), Buyer shall promptly notify Seller in writing as
        to the Shortfall Amount. Within five (5) Business Days after delivery of such
        notice, unless Seller disputes the amount thereof, Seller shall pay Buyer by
        wire transfer of immediately available funds an amount equal to the Shortfall
        Amount.The receivables in question will then be transferred to Seller and Buyer
        agrees to provide any reasonable assistance requested by Seller to collect said
        receivables. For purposes hereof, it is understood that the Accounts Receivable
        included in the current assets to be set forth on the Closing Balance Sheet will
        be net of any reserve for doubtful accounts. Any disputes as to the Shortfall
        Amount shall be submitted to and resolved by the Independent Accountants in the
        same manner as provided for in Section 2.2(c). 





	
        2.3	
CLOSING.The transfer of the Shares (the
“Closing”) provided for in this Agreement will take
place by execution of the Deed of Transfer at the offices of Clifford Chance as
soon as all of the conditions to Closing set forth in Articles 7 and 8 have been
or can be satisfied, on a date, subject to the foregoing, to be reasonably
specified by Buyer by written notice at least five (5) Business Days in advance
or at such other time and place as the parties may agree. Subject to the
provisions of Section 9, failure to consummate the purchase and sale provided
for in this Agreement on the date and time and at the place determined pursuant
to this Section 2.3 will not result in the termination of this Agreement and
will not relieve any party of any obligation under this Agreement. 





2.4
     
CLOSING OBLIGATIONS.  At the Closing:



(a)          
        Seller will deliver, or cause a Related Person to
        deliver, to Buyer:


		
        (i)	
        a certificate executed by Seller representing and warranting to Buyer that each
            of Seller’s representations and warranties in this Agreement was accurate
            in all respects as of the date of this Agreement, provided that the
            representations and warranties in so far as they relate to the Company will be
            as of the date the Company will have been incorporated and is accurate in all
            respects as of the Closing Date as if made on the Closing Date (giving full
            effect to any supplements to and schedules or exhibits attached hereto that were
            delivered by Seller to Buyer prior to the Closing Date in accordance with
            Section 5.5); and 





		
        (ii)	
            resignations, effective as of the Closing, of such directors and officers of the
            Acquired Companies as may be designated by the Board of the Company prior to
            Closing. 







15





(b)          
        Buyer, Seller and the Dutch Notary will execute the
        Deed of Transfer.



(i)     Buyer will deliver, or
        cause a Related Person to deliver:(ii) the Preliminary Purchase Price by wire
        transfer to Seller, to an account to be specified by Seller; and(iii) a
        certificate executed by Buyer to the effect that, except as otherwise stated in
        such certificate, each of Buyer’s representations and warranties in this
        Agreement was accurate in all respects as of the date of this Agreement and is
        accurate in all respects as of the Closing Date as if made on the
        Closing Date. 


	
3.	
REPRESENTATIONS AND WARRANTIES OF SELLER.  Seller represents and warrants
to Buyer as follows (which representations and warranties in so far
           as they relate to the Company shall be as of the date when the Company has
been incorporated):





	
        3.1	
        ORGANIZATION AND GOOD STANDING.





	
        (a)	
        Schedule 3.1(a) contains a complete and accurate list for each Acquired
        Company of its name, its jurisdiction of incorporation or formation, other
        jurisdictions in which it is authorized to do business, and its capitalization
        (including the identity of each shareholder and the number of shares or other
        ownership interests held by each). Each Acquired Company is duly organized,
        validly existing and in good standing - to the extent such concept is relevant
        in its jurisdiction of incorporation or formation - under the laws of its
        jurisdiction of incorporation or formation, with full power and authority to
        conduct its business as it is now being conducted, to own or use the properties
        and assets that it purports to own or use and to perform all its obligations
        under Applicable Contracts. Each Acquired Company is duly qualified to do
        business as a foreign corporation or other entity and is in good standing under
        the laws of each other jurisdiction in which either the ownership or use of the
        properties owned or used by it, or the nature of the activities conducted by it,
        requires such qualification where the lack of such qualification would have a
        material adverse effect on the Business. 





	
        (b)	
         The Company is, and at all times since its incorporation has been, a
                limited liability company with only one shareholder.





	
        (c)	
        Seller has delivered to Buyer copies of the Organizational Documents of each
                Acquired Company, as currently in effect.






3.2     AUTHORITY; NO CONFLICT.


	
        (a)	
        This Agreement constitutes the legal, valid, and binding obligation of Seller,
        enforceable against Seller in accordance with its terms. Upon the execution and
        delivery by Seller of the Shareholders Agreement (the “Seller’s
        Closing Documents”), the Seller’s Closing Documents will
        






16




		
        constitute the legal, valid and binding obligations of Seller, enforceable
against Seller in accordance with their respective terms. Seller has all the
necessary right, power, authority and capacity to execute and deliver this
Agreement and the Seller’s Closing Documents and to perform its obligations
under this Agreement and the Seller’s Closing Documents. 





	
        (b)	
        Except as set forth in Schedule 3.2(b), neither the execution and
        delivery of this Agreement nor the consummation or performance of any of the
        Contemplated Transactions will, directly or indirectly (with or without notice
        or lapse of time): 






(i) 
        contravene, conflict
        with or result in a violation of (A) any provision of the Organizational
        Documents of Seller or of the Acquired Companies, or (B) any resolution
        adopted by the board of directors or the shareholders of Seller or of any
        Acquired Company; 



(ii)     contravene, conflict
        with or result in a violation of, or give any Governmental Body or other Person
        the right to exercise any remedy or obtain any relief under, any Legal
        Requirement or any Order to which any Acquired Company or Seller, or any of the
        assets owned or used by any Acquired Company or otherwise in connection with the
        Business, may be subject; 



(iii)    contravene, conflict
        with or result in a violation of any of the terms or requirements of, any
        Governmental Authorization that is held by any Acquired Company or that
        otherwise relates to the Business or the business of, or any of the assets owned
        or used by, any Acquired Company; 



(iv)     cause  any Acquired Company to become subject to, or to become liable for the
        payment of, any Tax;



(v)      contravene or result in
        a violation or breach of any provision of, or give any Person the right to
        declare a default or exercise any remedy under, or to accelerate the maturity or
        performance of, or to cancel, terminate or modify, any Applicable
        Contract; or 



(vi)     result in the imposition or creation of any Encumbrance upon or with respect
        to any of the assets owned or used by any Acquired Company or otherwise
        in connection with the Business.


Except as set forth in
Schedule 3.2(b), neither Seller nor any Acquired Company is or will
be required to give any notice to or obtain any Consent from any Person in
connection with the execution and delivery of this Agreement or the consummation
or performance of any of the Contemplated Transactions. 


	
        3.3	
        CAPITALIZATION.





	
        (a)	
        All Shares have been validly authorized and issued in compliance with all Legal
        Requirements. All Shares are fully paid up and the Shares constitute 






17




		
        all of the
outstanding class A shares in the Company and 55% of all outstanding shares in
the Company. 






	
        (b)	
        The Seller has full legal and beneficial title (juridisch en economisch
        eigendom) to all of the Shares free and clear of any third party rights and
        is entitled to sell and transfer the full legal and beneficial ownership
        (juridisch en economisch eigendom) of the Shares under the terms of this
        Agreement. 





	
        (c)	
        No pre-emption rights or other rights, other than pursuant to the Company’s
        Articles of Association, pursuant to which a third party is or shall be entitled
        to have one or more of the Shares transferred to it or encumbered exist in
        relation to the Shares. 





	
        (d)	
        None of the Shares is encumbered with a right of pledge and/or usufruct
        (vruchtgebruik) or subject to attachment.





	
        (e)	
        No depository receipts (certificaten van aandelen) are issued in relation to
                any of the Shares.





	
        (f)	
        With the exception of the Shares and the remaining 45% of the outstanding shares
        in the Company (which are owned by Seller), all of the outstanding equity
        securities and other securities of each Acquired Company are owned of record and
        beneficially by one or more of the Acquired Companies, free and clear of all
        Encumbrances except where the ownership of shares is required under the Legal
        Requirements of the jurisdiction of organization to be vested in those Persons
        serving on the Board of Directors of an Acquired Company. No legend or other
        reference to any purported Encumbrance appears upon any certificate representing
        equity securities of any Acquired Company. All of the outstanding equity
        securities of each Acquired Company have been duly authorized and validly issued
        and are fully paid and non-assessable. Except as set forth on
        Schedule 3.3(b), there are no Contracts relating to the issuance,
        sale, or transfer of any equity securities or other securities of any Acquired
        Company. Seller is not a party to any option, warrant, purchase right or other
        contract or commitment that could require Seller to sell, transfer, or otherwise
        dispose of any equity securities of the Acquired Companies. There are no voting
        trust, proxy or other agreement with respect to the voting of any Shares of the
        Acquired Companies. None of the outstanding equity securities or other
        securities of any Acquired Company was issued in violation of any Legal
        Requirement. 





	
        (g)	
        Except as set forth on Schedule 3.3(c), no Acquired Company owns, or has
        any Contract to acquire, any equity securities or other securities of any Person
        (other than Acquired Companies) or any direct or indirect equity or ownership
        interest in any other business. 






18




	
        3.4	
         FINANCIAL STATEMENTS. Seller has delivered to Buyer:
        (i) all available audited financial statements of the Acquired Companies
        and the Business as of December 31 for each of the years 2000 and 2001, (ii)
        unaudited financial statements for the Heat Transfer Existing Subsidiaries as
        for each of the years 2000 and 2001 and (iii) a proforma unaudited
        consolidated balance sheet of the Acquired Companies and the Business as at the
        Effective Time (the “Balance Sheet”) all of which are attached hereto
        as Schedule 3-4. Buyer acknowledges that the audited financial statements, if
        any, may be audited according to local accounting principles or according to
        GAAP, and nothing in this section requires Seller to restate these financial
        statements. The Balance Sheet is true and correct and fairly presents the
        financial condition of the Acquired Companies and the Business in all
        material and reflects the consistent application of accounting principles. 





	
        3.5	
        BOOKS AND RECORDS. The books of account, minute books,
        stock record books, and other records of the Acquired Companies for the period
        of time as the Acquired Companies have been owned by the Seller, all of which
        have been made available to Buyer, are complete and correct and have been
        maintained in accordance with reasonable business practices of the Seller,
        including the maintenance of an adequate system of internal controls. For such
        time as the Acquired Companies have been owned by the Seller, such minute books
        contain records of all meetings held of, and corporate action taken by, the
        stockholders, the Boards of Directors, and committees of the Boards of Directors
        of the applicable Persons, which are accurate and complete in all material
        respects and, to Seller’s Knowledge, no meeting of any such stockholders,
        Board of Directors, or committee has been held for which minutes have not been
        prepared and are not contained in such minute books, where the absence of such
        record would have a material adverse effect on the Acquired Companies. At the
        Closing, all of those books and records will be in the possession of the
        Acquired Companies. 





	
        3.6	
        TITLE TO PROPERTIES; ENCUMBRANCES. Schedule 3.6
        contains a complete and accurate list of all real property, leaseholds or other
        interests therein used in connection with the Business. Seller has delivered or
        made available to Buyer copies of the deeds and other instruments (as recorded)
        by which Seller or one of the Acquired Companies acquired such real property
        and/or interests, and copies of all title insurance policies, opinions,
        abstracts and surveys that, to Seller’s Knowledge, are in the possession of
        Seller or the Acquired Companies and relating to such property or interests. The
        Acquired Companies own, or will as of the Closing Date own, (with good and
        marketable title in the case of owned real property, subject only to the matters
        permitted by the following sentence) all the properties and assets (whether
        real, personal or mixed and whether tangible or intangible) that are used in
        connection with the Business, or reflected as owned in the books and records of
        the Acquired Companies or the Business, including all of the properties and
        assets reflected in the Balance Sheet (except for assets held under capitalized
        leases disclosed or not required to be disclosed in Schedule 3.6 and
        personal property sold since the date of the Balance Sheet in the Ordinary
        Course of Business), and all of the material properties and assets purchased or






19




		
        otherwise acquired to be owned by the Acquired Companies or otherwise in
        connection with the Business since the date of the Balance Sheet (except for
        personal property acquired and sold since the date of the Balance Sheet in the
        Ordinary Course of Business and consistent with past practice), which
        subsequently purchased or acquired properties and assets (other than inventory
        and short-term investments) are listed in Schedule 3.6. All material
        properties and assets reflected in the Balance Sheet are free and clear of all
        Encumbrances and are not, in the case of real property, subject to any rights of
        way, building use restrictions, exceptions, variances, reservations or
        limitations of any material nature except, with respect to all such properties
        and assets, (a) mortgages or security interests shown on the Balance Sheet
        as securing specified liabilities or obligations, with respect to which no
        default (or event that, with notice or lapse of time or both, would constitute a
        default) exists, (b) mortgages or security interests incurred in connection
        with the purchase of property or assets after the date of the Balance Sheet
        (such mortgages and security interests being limited to the property or assets
        so acquired), with respect to which no material default (or event that, with
        notice or lapse of time or both, would constitute a default) exists,
        (c) liens for current taxes not yet due, and (d) with respect to real
        property, any restrictions which have not been identified in documents of
        ownership or title insurance. All buildings, plants and structures owned by the
        Acquired Companies or otherwise used in connection with the Business lie wholly
        within the boundaries of the real property owned by the Acquired Companies and
        to Seller’s Knowledge, do not encroach upon the property of, or otherwise
        conflict with the property rights of, any other Person. 





	
        3.7	
        CONDITION AND SUFFICIENCY OF ASSETS. The buildings,
        structures and equipment used in the Business are structurally sound, are in
        good operating condition and repair and are adequate for the uses to which they
        are being put, and none of such buildings, structures or equipment is in need of
        maintenance or repairs except for ordinary, routine maintenance and repairs that
        are not material in nature or cost or other repairs included in the Base
        Business Plan. The buildings, structures and equipment of the Acquired Companies
        are sufficient for the continued conduct of the Business after the Closing in
        substantially the same manner as conducted prior to the Closing. One or more of
        the Acquired Companies is, or will be as of the Closing Date, the owner of all
        right, title and interest in and to all of the material assets that have been
        used in connection with the operation of the Business by Seller or the Heat
        Transfer Existing Subsidiaries (including all material Applicable Contracts,
        Intellectual Property Assets, inventory, insurance, Governmental Authorizations,
        licenses and permits), whether tangible or intangible, free and clear of all
        Encumbrances, and such assets are sufficient for the continued conduct of the
        Business after the Closing in substantially the same manner as conducted prior
        to the Closing. 





	
        3.8	
        ACCOUNTS RECEIVABLE. All trade accounts receivable of the
        Business that are reflected on the Balance Sheet (whether or not they were
        factored as of the date of the Balance Sheet) and all accounts receivable of the
        Business that will be reflected on the accounting records of the Acquired
        Companies as of the Closing 






20





		
        Date (collectively, the “Accounts
        Receivable”) represent or will represent valid obligations
        arising from sales actually made or services actually performed in the Ordinary
        Course of Business, and the respective reserves shown on the Balance Sheet or on
        the accounting records of the Company as of the Closing Date are
        calculated consistent with GAAP and, in the case of the reserve as of the
        Closing Date, will be so calculated. There is no contest, claim or right of
        set-off which has been asserted by any account debtor, other than those incurred
        in the Ordinary Course of Business, under any Contract with any obligor of an
        Accounts Receivable relating to the amount or validity of such Accounts
        Receivable. 





	
                3.9	
        INVENTORY. All inventory of the Business, whether or not
        reflected in the Balance Sheet, is owned by the Acquired Companies and to
        Seller’s Knowledge, consists of a quality and quantity usable and salable
        in the Ordinary Course of Business, except for obsolete items and items of
        below-standard quality, all of which have been written off or written down to
        net realizable value in the Balance Sheet or on the accounting records of the
        Acquired Companies as of the Closing Date, as the case may be.  All
        inventories not written off have been priced at the lower of cost or net
        realizable. The quantities of each item of inventory (whether raw materials,
        work-in-process or finished goods) are not excessive, but are reasonable in the
        present circumstances of the Acquired Companies. 





	
        3.10	
        NO UNDISCLOSED LIABILITIES. Except as set forth in
        Schedule 3.10 or 3.19, to Seller’s Knowledge, the Business and the
        Acquired Companies have no material liabilities or obligations whether absolute,
        accrued, contingent or otherwise) except for liabilities or obligations
        reflected or reserved against in the Balance Sheet and such trade payables and
        short term trade indebtedness relating to the Business as may have been incurred
        in the Ordinary Course of Business since the date thereof. 





	
        3.11	
        TAXES.





	
        (a)	
        To Seller’s Knowledge, Seller and the Acquired Companies have filed or
        caused to be filed all Tax Returns that are or were required to be filed by or
        with respect to the Business or any of them, either separately or as a member of
        a group of corporations, pursuant to applicable Legal Requirements where the
        failure to file such Tax Return would have a material adverse effect on the
        Business or the Acquired Companies. Seller will make available to Buyer or its
        Representatives, at its request, copies of, and Schedule 3.11  contains a
        complete and accurate list of, all such Tax Returns since January 1, 1998. To
        Seller’s Knowledge, Seller and the Acquired Companies have paid, or made
        provision for the payment of, all material Taxes that have or may have become
        due pursuant to those Tax Returns or otherwise, or pursuant to any assessment
        received with respect to the Business or by Seller or any Acquired Company,
        except such Taxes, if any, as are listed in Schedule 3.11 and are
        being contested in good faith and as to which adequate reserves (determined in
        accordance with GAAP) have been provided in the Balance Sheet. 






21




	
        (b)	
        To Seller’s Knowledge, all deficiencies proposed as a result of such audits
        have been paid, reserved against, settled, or, as described in
        Schedule 3.11, are being contested in good faith by appropriate
        proceedings. Except as described in Schedule 3.11, neither Seller
        nor any Acquired Company has given or been requested to give waivers or
        extensions (or is or would be subject to a waiver or extension given by any
        other Person) of any statute of limitations relating to the payment of Taxes of
        Seller or any Acquired Company or for which Seller or any Acquired Company may
        be liable. 





	
        (c)	
        To Seller’s Knowledge, the charges, accruals and reserves with respect to
        Taxes on the respective books of Seller and each Acquired Company are adequate
        (determined in accordance with GAAP) and are at least equal to Seller’s and
        that Acquired Company’s expected liability for Taxes. There exists no
        proposed tax assessment against Seller, any Acquired Company or the Business
        except as disclosed in the Balance Sheet or in Schedule 3.11. To
        Seller’s Knowledge, all material Taxes that Seller or any Acquired Company
        is or was required by Legal Requirements to withhold or collect have been duly
        withheld or collected and, to the extent required, have been paid to the proper
        Governmental Body or other Person. 





	
        (d)	
        All Tax Returns filed with respect to the Business or by (or that include on a
        consolidated basis) Seller or any Acquired Company, to the Knowledge of the
        Seller, are true, correct and complete in all material respects. There is no tax
        sharing agreement that will require any payment by Seller or any Acquired
        Company after the date of this Agreement. 





	
        3.12	
        NO MATERIAL ADVERSE CHANGE. Except as disclosed on Schedule
        3.12, since December 31, 2001, there has not been any material adverse change in
        the business, operations, properties, prospects, assets or condition of the
        Business or any Acquired Company, and no event has occurred or circumstance
        exists that may result in such a material adverse change. 





	
        3.13	
        EMPLOYEE BENEFITS.




Schedule 3.13 contains a list of:




(a)      all employees employed
        by any of the Acquired Companies (“Employees
”);



(b) 
all individual benefits in the widest sense of the word, including but not
limited to salaries, the Employees or former Employees are entitled to (the
“Individual Benefits”) and
all collective rights and benefits with respect to the Employees, including but
not limited to collective bargaining agreements (the “Collective
Benefits”);



22





(c)       all obligations and liabilities of any of the Acquired Companies imposed by law or otherwise with respect to its Employees, including but not
      limited to, by social security or tax authorities (“Employee
Liabilities”);



(d) 
         all rules and regulations applicable to any of the Employees, including but not
        limited with respect to health, safety and environment
        protection (the “Employment Rules”); and




(e)      all disputes between an Acquired Company and any Employee or former Employee
 (“Employment Disputes”).


There
are no other persons employed by any of the Acquired Companies other than the
Employees and any all Employees are employed by the relevant Acquired Company in
connection with the Business as conducted at the Effective Date. All Continuing
Employees (as defined below) that are hereby transferred directly or indirectly
to the Buyer through the Acquired Companies have been exclusively working for
the Business since 1 January 2002. There are no Employees entitled to any other
individual benefits or collective benefits other than the Individual Benefits
and Collective Benefits and (i) each and all of such Individual Benefits and
Collective Benefits has been duly paid and/or fulfilled by the relevant Acquired
Company and (ii) there is no obligation, by law or otherwise, for any of the
Acquired Companies to increase the Individual Benefits or the Collective
Benefits. Each of the Acquired Companies has duly paid and fulfilled all and any
of its Employee Liabilities and is at the date hereof and at Closing in due
compliance with any Employment Rules, also including but not limited to any
rules or procedures related to the change of control of the Business and
transfer of Business to Acquired Companies. There are no other disputes between
any of the Acquired Companies and Employees or former Employees other than the
Employment Disputes. 


	
                3.14 	
        COMPLIANCE WITH LEGAL REQUIREMENTS; GOVERNMENTAL AUTHORIZATIONS.





	
        (a) 	
        Except as set forth in Schedule 3.14 or Schedule 3.19:





		
        (i)	
        each Acquired Company is, and at all times since January 1, 1998 has been,
        and the Business has been conducted at all times since January 1, 1998, in full
        compliance with each Legal Requirement that is or was applicable to it or to the
        conduct or operation of its business or the ownership or use of any of its
        assets except for any such failure that would not result in a material adverse
        effect; 





		
        (ii)	
        no event has occurred or circumstance exists that (with or without notice or
        lapse of time) (A) may constitute or result in a violation by the Business or
        any Acquired Company of, or a failure on the part of the Business or any
        Acquired Company to comply with, any Legal Requirement, or (B) may give rise to
        any obligation on the part of the Company, Seller, any Acquired Company or Buyer
        to undertake, or to bear all or any portion of the cost of, any remedial action
        of any nature; and 






23




		
        (iii)	
        neither Seller nor any Acquired Company has received at any time since
        January 1, 1998 any notice or other communication (whether oral or written)
        from any Governmental Body or any other Person regarding (A) any actual,
        alleged, possible or potential violation of, or failure to comply with, any
        Legal Requirement which would have a material effect on the Business or any
        Acquired Company, or (B) any actual, alleged or potential obligation on the part
        of Seller, the Business or any Acquired Company arising under any applicable
        Legal Requirement to undertake, or to bear any material portion of the cost of,
        any remedial action of any material nature. 





	
        (b) 	
        Schedule 3.14 contains a complete and accurate list of each material
        Governmental Authorization that is required to be held by the Business for its
        operation or that is otherwise required for the Business or any Acquired Company
        to own or use any of its assets. Each Governmental Authorization listed or
        required to be listed in Schedule 3.14 is valid and in full force and
        effect. Except as set forth in Schedule 3.14 or Schedule 3.19: 





		
        (i)	
        all of the material terms and requirements of each Governmental Authorization
        identified or required to be identified in Schedule 3.14 have been at all
        required times complied with by the Business and, to the extent applicable, each
        Acquired Company in all material respects; 





		
        (ii)	
        no material event has occurred or circumstance exists that may (with or without
        notice or lapse of time) (A) constitute or result in a violation of or a failure
        to comply with any material term or requirement of any Governmental
        Authorization listed or required to be listed in Schedule 3.14, or (B)
        result in the revocation, withdrawal, suspension, cancellation or termination
        of, or any material modification to, any Governmental Authorization listed or
        required to be listed in Schedule 3.14; 






		
        (iii)	
        neither Seller nor any Acquired Company has received, at any time since
        January 1, 1998, any notice or other communication (whether oral or
        written) from any Governmental Body or any other Person regarding (A) any
        actual, alleged or potential violation of, or failure to comply with, any
        material term or requirement of any Governmental Authorization, or (B) any
        actual, proposed or potential revocation, withdrawal, suspension, cancellation,
        termination of or material modification to any Governmental Authorization; and







24




		
        (iv)	
        all material applications required to have been filed for the renewal of the
        Governmental Authorizations listed or required to be listed in Schedule
        3.14 or which are required by or in connection with the Contemplated
        Transactions have been duly filed on a timely basis with the appropriate
        Governmental Bodies, and all other material filings required to have been made
        with respect to such Governmental Authorizations have been duly made on a timely
        basis with the appropriate Governmental Bodies. 





The Governmental
Authorizations listed in Schedule 3.14 collectively constitute all of the
Governmental Authorizations necessary to permit the Business to be lawfully
conducted in the manner it is currently conducted in all material respects and
to permit the Acquired Companies to own and use their assets in the manner in
which they currently own and use such assets in all material respects. 



3.15
    
LEGAL PROCEEDINGS; ORDERS.


	
        (a)	
        Except as set forth in Schedule 3.15 or Schedule 3.19, to the
Knowledge of Seller there is no pending Proceeding:






(i)      that has been commenced
        by or against any Acquired Company or may affect the Business or the business
        of, or any of the assets owned or used by, any Acquired Company in any material
        respect; or(ii) that challenges, or that may have the effect of preventing,
        delaying, making illegal or otherwise interfering with in any material way, any
        of the Contemplated Transactions. 


To Seller’s Knowledge,
no such Proceeding has been Threatened. Seller has delivered to Buyer copies of
all pleadings, correspondence and other documents relating to each Proceeding
listed in Schedule 3.15 requested by Buyer. The Proceedings listed in
Schedule 3.15 will not have a material adverse effect on the Business or
the business, operations, assets, condition or prospects of any Acquired
Company. 


	
        (b) 	
        Except as set forth in Schedule 3.15:






(i)      there is no material Order to which the
        Business or any of the Acquired Companies, or any of the assets owned or used
        by any Acquired Company or
        otherwise in connection with the Business, is subject;



(ii)     Seller is not subject to any material Order that
        relates to the Business or the business of, or any of the assets owned or used by,
        any Acquired Company; and 



(iii)    no officer, director,
        agent or employee of any Acquired Company is subject to any Order that prohibits
        such officer, director, agent or employee from engaging in or continuing any
        conduct, activity or practice relating to the Business or the business of any
        Acquired Company which would have a material adverse effect on the Business or
        the business of any Acquired Company. 



25




	
        (c)	
        Except as set forth in Schedule 3.15:






(i)      the Seller and each
        Acquired Company are in full compliance with all of the terms and requirements
        of each material Order to which the Business or they, or any of the assets owned
        or used by it, is or has been subject; 



(ii)     no event has occurred
        or circumstance exists that may constitute or result in (with or without notice
        or lapse of time) a material violation of or failure to comply with any term or
        requirement of any Order to which Seller, the Business or any Acquired Company,
        or any of the assets owned or used by any Acquired Company is subject;
        and 



(iii)    neither Seller nor
        any Acquired Company has received any notice or other communication (whether
        oral or written) from any Governmental Body or any other Person regarding any
        actual, alleged potential violation of, or failure to comply with, any material
        term or requirement of any Order to which the Seller, the Business or any
        Acquired Company, or any of the assets owned or used by any Acquired Company or
        otherwise in connection with the Business, is or has been subject.
        


3.16
    ABSENCE OF CERTAIN CHANGES AND EVENTS.



Except as set forth in
Schedule 3.16, since December 31, 2001 and for clauses (f), (g), and (i)
of this Section 3.16, since December 31, 2000 the Business has been conducted by
the Seller and its Related Persons only in the Ordinary Course of Business and
there has not been, with respect to or relating to the Business, any: 



(a)      issuance of any
        membership interests in or shares of capital stock of any Acquired Company
        except as necessary to provide for the creation of the Acquired Companies and
        consistent with Section 3.3; grant of any stock option or right to purchase
        membership interests in or shares of capital stock of any Acquired Company;
        issuance of any security convertible into such capital stock; grant of any
        registration rights; purchase, redemption, retirement or other acquisition by
        any Acquired Company of any membership interests in or shares of any such
        capital stock; or declaration or payment of any dividend or other distribution
        or payment in respect of shares of capital stock; 



(b)      amendment to the Organizational Documents of any
        of the Heat Transfer Existing
        Subsidiaries or any Acquired Company except as may be necessary to
        provide for the creation of the Acquired Companies;



(c)      except in the Ordinary Course of Business, payment or increase by any Acquired
        Company of any management fee or any bonuses, salaries, or other
        compensation to any stockholder, director, officer or employee or entry into any
        employment, severance or similar Contract with any director, officer or
        employee;



(d)      except in the Ordinary
        Course of Business, adoption of, or increase in the payments to or benefits
        under, any profit sharing, bonus, deferred compensation, savings, insurance,
        pension, retirement or other employee benefit plan for or with any employees of
        any Acquired Company;



26





(e)      damage to or
        destruction or loss of any asset or property of any Acquired Company, whether or
        not covered by insurance, materially and adversely affecting the properties,
        assets, business, financial condition or prospects of the Business or the
        Acquired Companies, taken as a whole; 



(f)      entry into, termination
        of or receipt of notice of termination of (i) any license, distributorship,
        dealer, sales representative, joint venture, credit or similar agreement which
        would have a material impact on the Business, or (ii) any Contract or
        transaction involving a total remaining commitment by or to any Acquired Company
        of at least $100,000; 



(g)      except in the Ordinary
        Course of Business, sale, lease or other disposition of any asset or property of
        any Acquired Company or mortgage, pledge or imposition of any lien or other
        encumbrance on any material asset or property of any Acquired Company or
        otherwise relating to the Business, including the sale, lease or other
        disposition of any of the Intellectual Property Assets;



(h)      cancellation or waiver of any claims or rights
        with a value to any Acquired Company in excess of $25,000;



(i)      material change in the accounting methods used
        by any Acquired Company; or 



(j)      agreement, whether oral or written, by Seller
        or any Acquired Company to do any of the foregoing. 



3.17    
CONTRACTS; NO DEFAULTS.



(a)      Schedule 3.17(a)
        contains a complete and accurate list, and Seller has delivered to Buyer true
        and complete copies, of: 



(i)              each Applicable
                Contract that involves performance of services or delivery of goods or materials
                by one or more Acquired Companies or otherwise in connection with the Business
                of an amount or value in excess of $100,000; 



(ii)             each Applicable
                Contract that involves performance of services or delivery of goods or materials
                to one or more Acquired Companies or otherwise in connection with the Business
                of an amount or value in excess of $100,000; 



(iii)            each Applicable
                Contract that was not entered into in the Ordinary Course of Business and that
                involves expenditures or receipts of one or more Acquired Companies or otherwise
                in connection with the Business in excess of $25,000; 



(iv)             each lease, rental or
                occupancy agreement, license, installment and conditional sale agreement, and
                other Applicable Contract affecting the ownership of, leasing of, title to, use
                of or any leasehold or other interest in, any real or personal property (except
                personal property leases and installment and conditional sales agreements having
                a value per item or aggregate payments of less than $25,000 and with terms of
                less than one year); 



27





(v)              each licensing
                agreement or other Applicable Contract with respect to patents, trademarks,
                copyrights or other intellectual property, including agreements with current or
                former employees which are still in effect, consultants or contractors regarding
                the appropriation or the non-disclosure of any of the Intellectual Property
                Assets other than those agreements with employees entered into in the ordinary
                course of business; 



(vi)             each collective
                bargaining agreement and other Applicable Contract to or with any labor union or
                other employee representative of a group of employees;
                



(vii)            each joint venture, partnership and other
        Applicable Contract (however named) involving a sharing of profits, losses, costs,
        or liabilities by any Acquired Company with any other Person;
         



                (vii) 
                each Applicable
                Contract containing covenants that in any material way purport to restrict the
                business activity of the Business or any Acquired Company or any Related Person
                of an Acquired Company or limit the freedom of the Business or any Acquired
                Company or any Related Person of an Acquired Company in any material way to
                engage in any of its line of business or to compete with any Person in its lines
                of business; 



                (ix) 
                each Applicable
                Contract providing for payments to or by any Person based on sales, purchases or
                profits, other than direct payments for goods; 



                (x) 
                each power of attorney
                that is currently effective and outstanding which could effect in a material way
                the Business or the Acquired Companies; 



                (xi) 
                each Applicable
                Contract entered into other than in the Ordinary Course of Business that
                contains or provides for an express undertaking by any Acquired Company to be
                responsible for indirect, consequential or punitive damages;
                



                (xii) 
                each Applicable Contract for capital expenditures
                 in excess of $25,000;  



                (xiii) 
                each written
                warranty, guaranty and other similar undertaking with respect to contractual
                performance extended by any Acquired Company other than in the Ordinary Course
                of Business; and 



                (xiv) 
                each material
                amendment, supplement and modification (whether oral or written) in respect of
                any of the foregoing. 



Schedule 3.17(a) sets forth sufficient details concerning such Contracts to
 identify the Contracts, and the Acquired Companies' office where details
relating to the Contracts are located.



        (b) 
        Except as set forth in Schedule 3.17(b):
        



        (i)  
Neither Seller nor any
                Related Person of Seller has or may acquire any rights under, and Seller has not
                become subject to any obligation or liability under, any material Contract that
                relates to the business of, or any of the material assets owned or used by, any
                Acquired Company; and 




28





                (ii) 
                To Seller’s Knowledge, no officer or employee of any Acquired Company
                is bound by any
                Contract that purports to limit the ability of such officer or employee to (A)
                engage in or continue any conduct, activity or practice relating to the business
                of any Acquired Company, or (B) assign to any Acquired Company any material
                rights to any invention, improvement or discovery made in the course of said
                officer’s or employee’s employment. 



        (c) 
        Except as set forth in
        Schedule 3.17(c), each Contract identified or required to be identified
        in Schedule 3.17(a) is in full force and effect and is valid and
        enforceable in accordance with its terms in all material respects. 



        (d) 
        Except as set forth in Schedule 3.17(d)



                (i) 
                to Seller’s
                Knowledge, each Acquired Company is, and at all times has been, in compliance in
                all material respects with all applicable terms and requirements of each
                Contract under which such Acquired Company has or had any obligation or
                liability or by which such Acquired Company or any of the assets owned or used
                by such Acquired Company or otherwise in connection with the Business is or was
                bound; 



                (ii) 
                to Seller’s
                Knowledge, each other Person that has or had any obligation or liability under
                any Contract under which an Acquired Company has or had any rights is, and at
                all times has been, in compliance in all material respects with all applicable
                terms and requirements of such Contract; 



                (iii) 
                to Seller’s
                Knowledge, no event has occurred or circumstance exists that (with or without
                notice or lapse of time) may contravene, conflict with or result in a material
                violation or breach of, or give any Acquired Company or other Person the right
                to declare a default or exercise any remedy under, or to accelerate the maturity
                or performance of, or to cancel, terminate or modify, any Applicable Contract;
                and (iv) neither Seller nor any Acquired Company has given to or received from
                any other Person any notice or other communication (whether oral or written)
                regarding any actual, alleged potential material violation or breach of, or
                default under, any Contract. 



        (e) 
        There are no
        renegotiations of any material amounts paid or payable to Seller or any Acquired
        Company under current or completed Contracts with any Person and no such Person
        has made written demand for such renegotiation. 



        (f) 
        The Contracts relating
        to the sale, design, manufacture, or provision of products or services by the
        Acquired Companies or otherwise in connection with the Business have been
        entered into in the Ordinary Course of Business and have been entered into
        without the commission of any act alone or in concert with any other Person, or
        any consideration having been paid or promised, that is or would be in material
        violation of any Legal Requirement. 



3.18     INSURANCE.



        (a)          
             
        Seller has delivered to Buyer 




29





        true and complete list of
        all policies of insurance to which any Acquired Company is a party or under
        which the Business, any Acquired Company, or any director of any Acquired
        Company, is or has been covered at any time within the five (5) years preceding
        the date of this Agreement and a list of all pending applications for policies
        of insurance; 



        (a)[sic]



        (b)          
        Schedule 3.18(b) describes:



                (i) 
                any self-insurance arrangement by or affecting
                the Business or any Acquired Company, including any reserves established
                thereunder;



                (ii) 
                any contract or arrangement, other than a
                policy of insurance, for the transfer or sharing of any risk by any Acquired Company
                or otherwise in connection with the Business; and 



                (iii) 
                all obligations of
                the Acquired Companies or otherwise in connection with the Business to third
                parties with respect to insurance (including such obligations under leases and
                service agreements) and identifies the policy under which such coverage is
                provided. 



        (c)          
        Schedule 3.18(c)
sets forth, by year, for the current policy year and each of the five (5)
preceding policy years: 



                (i) 
                a summary of the loss experience under each policy;



                (ii) 
                a statement describing each claim under an insurance policy for an amount
                in excess of $50,000, which sets forth: 


		
        (A)	
        the name of the claimant;





		
        (B)	
        description of the policy by insurer, type of
        insurance and period of coverage; and 





		
        (C)	
        the amount and a brief description of the claim;
        and 






        (iii)                 a statement
                describing the loss experience for all claims that were
                self-insured, including the number and aggregate cost of such
                 claims. 



        (d)          
                Except as set forth on Schedule 3.18(d),
        to Seller's Knowledge:



       (i) 
                All policies to which any Acquired Company is a party or will be a party
                at the Effective Time, or that provide coverage to Seller, the Business,
                any Acquired Company or any director or officer of an Acquired Company in
                all material respects: 


		
        (A)	
        are valid, outstanding and enforceable;
                        





		
        (B)	
        are issued by an insurer that is financially sound and
                        reputable;






30




		(C)	
        taken together, provide adequate insurance coverage for the Business and the
        assets and the operations of the Acquired Companies;





		
        (D)	
        are sufficient for compliance with all Legal Requirements and Contracts to which
        any Acquired Company is a party, by which any Acquired Company is bound or
        otherwise in connection with the Business to the extent insurance is customarily
        available therefor;





		
        (E)	
        will continue in full force and effect following the consummation of the
        Contemplated Transactions or, as applicable, will have been replaced by similar
        policies on or before the Closing Date; and





		
        (F)	
        do not provide for any retrospective premium adjustment or other
        experienced-based liability on the part of any Acquired Company or otherwise in
        connection with the Business.






               (ii) 
                Neither Seller nor any
                Acquired Company has received (A) any refusal of coverage or any notice that a
                defense will be afforded with reservation of rights, or (B) any notice of
                cancellation or any other indication that any insurance policy is no longer in
                full force or effect or will not be renewed or that the issuer of any policy is
                not willing or able to perform its obligations thereunder. 



                (iii) 
                The Acquired
                Companies or Seller have paid all premiums due, and have otherwise performed all
                of their respective obligations, under each policy to which any Acquired Company
                is a party or that provides coverage to the Business or to any Acquired Company
                or director thereof. 



                (iv) 
                To Seller’s
                Knowledge, the Acquired Companies have given notice to the insurer of all claims
                that may be insured thereby. 


	3.19	
        ENVIRONMENTAL MATTERS.  Except as set forth in Schedule
        3.19 or as described in the reports supplied
        by Seller or obtained by Buyer and each of
        which reports is specifically listed on Schedule 3.19, to Seller's
        Knowledge:





	
                (a)	
        Each of the Acquired Companies and the Business is in compliance with in all
        material respects and is not in violation of or liable under in any material
        respect, any Environmental Law. Neither Seller nor any Acquired Company has any
        reasonable basis to expect, nor has any of them received, any actual or
        Threatened order or notice from (i) any Governmental Body or private citizen
        acting in the public interest, or (ii) the current or prior owner or operator of
        any Facilities, of any actual or potential material violation or material
        failure to comply with any Environmental Law, or of any actual or Threatened
        obligation to undertake or bear the cost of any Environmental, Health, and
        Safety Liabilities with respect to any of the Facilities or any other properties
        or assets (whether real, personal, or mixed) in which Seller or any Acquired 






31




	
                	
        Company has or had an interest, or with respect to any property or Facility at
        or to which Hazardous Materials were generated, manufactured, refined,
        transferred, imported, used, or processed by Seller, any Acquired Company, or
        any other Person for whose conduct they are or may be held responsible, or from
        which Hazardous Materials have been transported, treated, stored, handled,
        transferred, disposed, recycled, or received. 





	
                (b)	
        There are no pending or Threatened claims, Encumbrances, or other material
        restrictions of any nature, resulting from any Environmental, Health, and Safety
        Liabilities or arising under or pursuant to any Environmental Law, with respect
        to or affecting any of the Facilities or any other properties and assets
        (whether real, personal, or mixed) in which Seller or any Acquired Company has
        or had an interest. 





	
                (c)	
        Neither Seller nor any Acquired Company has any basis to expect, nor has any of
        them or any other Person for whose conduct they are or may be held responsible,
        received, any citation, directive, inquiry, notice, Order, summons or warning
        that relates to Hazardous Activity, Hazardous Materials, or any alleged, actual,
        or potential violation or failure to comply with any Environmental Law, or of
        any alleged, actual, or potential obligation to undertake or bear the cost of
        any Environmental, Health, and Safety Liabilities with respect to any of the
        Facilities or any other properties or assets (whether real, personal, or mixed)
        in which Seller or any Acquired Company had an interest, or with respect to any
        property or facility to which Hazardous Materials generated, manufactured,
        refined, transferred, imported, used, or processed by Seller, any Acquired
        Company, or any other Person for whose conduct they are or may be held
        responsible, have been transported, treated, stored, handled, transferred,
        disposed, recycled, or received. 






	
                (d)	
        Neither Seller nor any Acquired Company nor any other Person for whose conduct
        they are or may be held responsible has any Environmental, Health, and Safety
        Liabilities with respect to the Facilities or with respect to any other
        properties and assets (whether real, personal, or mixed) in which any Acquired
        Company (or any predecessor), has or had an interest, or at any property
        geologically or hydrologically adjoining the Facilities or any such other
        property or assets. 





	
                (e)	
        Except in material compliance with or as permitted by applicable Environmental
        Law, there are no Hazardous Materials present on or in the Environment at the
        Facilities or at any geologically or hydrologically adjoining property in
        material quantities that emanated from Seller, any Acquired Company or any
        predecessor thereof, including any Hazardous Materials contained in barrels,
        above or underground storage tanks, landfills, land deposits, dumps, equipment
        (whether moveable or fixed) or other containers, either temporary or permanent,
        and deposited or located in land, water, sumps, or any other part of the
        Facilities or such adjoining property, or incorporated into any structure
        therein or thereon. Except in 






32




	
                	
        material compliance with or as permitted by
        applicable Environmental Law, neither Seller nor any Acquired Company nor any
        other Person for whose conduct they are or may be held responsible has permitted
        or conducted, or is aware of, any Hazardous Activity conducted with respect to
        the Facilities or any other properties or assets (whether real, personal, or
        mixed) in which any Acquired Company has or had an interest. 





	
                (f)	
        Except in material compliance with or as permitted by applicable Environmental
        Law, there has been no Release or Threat of Release, of any material amounts of
        Hazardous Materials at or from the Facilities. 





	
                (g)	
        Seller has delivered or made available to Buyer true and complete copies and
        results of the most recent material reports, studies, analyses, tests, or
        monitoring possessed or initiated by Seller or any Acquired Company or such
        other reports as Buyer has requested pertaining to Hazardous Materials or
        Hazardous Activities in, on, or under the Facilities, or concerning compliance
        by Seller, any Acquired Company, or any other Person for whose conduct they are
        or may be held responsible, with Environmental Laws. 






3.20    EMPLOYEES.


	
        (a)	
        Schedule 3.20(a) contains a complete and accurate list of the following
        information for each employee of the Acquired Companies whose compensation in
        2001 exceeded 80,000, including each employee on leave of absence or
        layoff status: employer, name, job title, current compensation paid or payable
        and any change in compensation since January 1, 2002, vacation accrued and
        service credited for purposes of vesting and eligibility to participate under
        any Acquired Company’s severance pay plan. 





	
        (b)	
        No employee or director of any Acquired Company is a party to, or is otherwise
        bound by, any agreement or arrangement, including any confidentiality,
        noncompetition or proprietary rights agreement, between such employee or
        director and any other Person (“Proprietary Rights
        Agreement”) that in any material way adversely affects or
        will affect (i) the performance of his or her duties as an employee or director
        of the Acquired Companies, or (ii) the ability of the Business to be conducted
        or of any Acquired Company to conduct its business, including any Proprietary
        Rights Agreement with Seller or the Acquired Companies by any such employee or
        director. To Seller’s Knowledge, no director, officer or other key employee
        of any Acquired Company intends to terminate his or her employment with such
        Acquired Company. 






3.21     LABOR RELATIONS; COMPLIANCE.



33




	
                (a)	
        Except as set forth on Schedule 3.21(a), neither the Business nor any
        Acquired Company has been or is a party to or bound by any collective bargaining
        or other material labor Contract. 





	
                (b)	
        Except as set forth on Schedule 3.21(b), since January 1, 1998,
        there has not been, there is not presently pending or existing and, to
        Seller’s Knowledge, there is not Threatened, (i) any strike, work stoppage
        or material employee grievance process, (ii) any Proceeding against or affecting
        the Business or any Acquired Company relating to the alleged material violation
        of any Legal Requirement pertaining to labor relations or employment matters,
        including any charge or complaint filed by an employee or union with any
        Governmental Body, organizational activity or other material labor or employment
        dispute against or affecting the Business or any of the Acquired Companies or
        their premises, or (iii) any application for certification of a collective
        bargaining agent. No event has occurred or circumstance exists that could on any
        reasonable basis provide the basis for any work stoppage or other labor dispute.
        There is no lockout of any employees by the Seller or any Acquired Company, and
        no such action is contemplated by the Seller or any Acquired Company. 





	
                (c)	
        Except as set forth on Schedule 3.21(c), the Seller and each
        Acquired Company have complied in all material respects with all Legal
        Requirements relating to employment, equal employment opportunity,
        nondiscrimination, immigration, wages, hours, benefits, collective bargaining,
        the payment of social security and similar taxes, occupational safety and health
        and plant closing. Except as set forth on Schedule 3.21(c), no
        Acquired Company is liable for the payment of any material compensation,
        damages, taxes, fines, penalties or other amounts, however designated, for
        failure to comply with any of the foregoing Legal Requirements. 





	
        3.22	
        INTELLECTUAL PROPERTY.





	
                (a)	
        Intellectual Property Assets.  The term “Intellectual Property
        Assets” includes to the extent owned or used by the Business:






                (i) 
                the names Heatcraft,
                Friga, and all derivatives or combinations thereof, and all fictional business
                names, trading names, registered and unregistered trademarks, service marks and
                applications (collectively, “Marks”); 



                (ii) 
                all patents, patent applications and inventions that may be patentable
                (collectively, “Patents”;



                (iii) 
                all copyrights in both published works and unpublished works
                (collectively, “Copyrights”;



                (iv) 
                all rights in mask works (collectively, “Rights in Mask Works
                ”; and




34





                (v) 
                all know-how, trade
                secrets, confidential information, customer lists, software, technical
                information, data, process technology, plans, drawings and blue prints
                (collectively, “Trade Secrets”) owned, used or licensed
                in connection with the Business; 



                       (vi) 
                the internet domain names relating to the Business.


	
        (b)	
        Agreements.  Schedule 3.22(b) contains a complete
        and accurate list and summary description, including any royalties paid or
        received by Seller or the Acquired Companies, of all Contracts relating to the
        Intellectual Property Assets to which Seller or any Acquired Company is a party
        or by which Seller or any Acquired Company is bound, except for any license
        implied by the sale of a product and perpetual, paid-up licenses for commonly
        available software programs with a value of less than $10,000 under which Seller
        or an Acquired Company is the licensee. There are no outstanding and, to
        Seller’s Knowledge, no Threatened disputes or disagreements of a material
        nature with respect to any such agreement. 





	
        (c)	
        Know-How Necessary for the Business.






                (i) 
                The Intellectual
                Property Assets are all those necessary for the operation of the Business as it
                is currently conducted. One or more of the Acquired Companies is the owner of
                all right, title and interest in and to each of the Intellectual Property Assets
                which are, except as set forth on Schedule 3.22(c)(i), free and clear of all
                Encumbrances, and has the right to use without payment to a third party all of
                the Intellectual Property Assets. 



                (ii) 
                Except as set forth in
                Schedule 3.22(c), all current employees of each Acquired Company
                have executed written Contracts with Seller or one or more of the Acquired
                Companies that assign to Seller or one or more of the Acquired Companies all
                rights to any inventions, improvements, discoveries or information relating to
                the Business. No employee, officer or director of Seller or any Acquired Company
                has entered into any Contract that restricts or limits in any way the scope or
                type of work in which the employee may be engaged or requires the employee to
                transfer, assign or disclose information concerning his or her work to anyone
                other than Seller or one or more of the Acquired Companies. 



        (d)          
             
        Patents.



                (i) 
                Schedule 3.22(d)
                contains a complete and accurate list and summary description of all Patents.
                Seller or one or more of the Acquired Companies is the owner of all right, title
                and interest in and to each of the Patents, free and clear of all Encumbrances.
        



                (ii) 
                All of the issued
                Patents are currently in compliance with formal legal requirements (including
                payment of filing, examination and maintenance fees and proofs of working or
                use), are valid and enforceable, except as set forth on Schedule 3.22(d)(ii),
                and are not subject to any maintenance fees or taxes or actions falling due
                within ninety (90) days after the Closing Date. 





35





                (iii) 
                No Patent has been or
                is now involved in any interference, reissue, reexamination or opposition
                proceeding. To Seller’s Knowledge, there is no potentially interfering
                patent or patent application of any third party. 



                (iv) 
                No Patent is infringed or, to Seller's Knowledge, has been challenged or
                threatened in any way.  None of the products manufactured and sold, nor any
                process or know-how used, by the Business or any Acquired Company infringes or
                is alleged to infringe any patent or other proprietary right of any other
                Person.



        (e)     
        Trademarks.



                (i) 
                Schedule 3.22(e)
                contains a complete and accurate list and summary description of all Marks. One
                or more of the Acquired Companies or will be at Closing is the owner of all
                right, title, and interest in and to each of the Marks, free and clear of all
                Encumbrances. 



                (ii) 
                All Marks that have
                been registered are currently in compliance with all formal legal requirements
                (including the timely post-registration filing of affidavits of use and
                incontestability and renewal applications), are valid and enforceable, except as
                set forth on Schedule 3.22(e)(ii), and are not subject to any maintenance fees
                or taxes or actions falling due within ninety (90) days after the Closing Date.
                



                 (iii) 
                No Mark has been or
                is now involved in any opposition, invalidation or cancellation and, to
                Seller’s Knowledge, no such action is Threatened with the respect to any of
                the Marks. 



        (iv) 
        To Seller’s
        Knowledge, there is no potentially interfering trademark or trademark
        application of any third party. 



                (v) 
                To Seller’s
                Knowledge, no Mark is infringed or, to Seller’s Knowledge, has been
                challenged or threatened in any way.  None of the Marks used by any
                Acquired Company infringes or is alleged to infringe any trade name, trademark
                or service mark of any third party. 



        (f)     
        Copyrights.



                (i) 
                To Seller’s
                Knowledge, no Copyright is infringed or has been challenged or threatened in any
                way. To Seller’s Knowledge, none of the subject matter of any of the
                Copyrights infringes or is alleged to infringe any copyright of any third party
                or is a derivative work based on the work of a third party. 



        (g)     
        Trade Secrets.



                (i) 
                Seller and the Acquired
                Companies have taken all reasonable precautions to protect the secrecy,
                confidentiality and value of their Trade Secrets. 



                (ii) 
                One or more of the
                Acquired Companies has good title and an absolute (but not necessarily
                exclusive) right to use the Trade Secrets. To the Seller’s
                Knowledge, the Trade Secrets are not part of the public knowledge or literature,
                and, to Seller’s 





36





        Knowledge, have not been used, divulged or appropriated either for
        the benefit of any Person (other than one or more of the Acquired Companies) or
        to the detriment of the Acquired Companies. No Trade Secret is subject to any
        adverse claim or has been challenged or threatened in any way. 


	
                3.23	
        CERTAIN PAYMENTS. To Seller’s Knowledge,no Acquired
        Company or director, officer, agent or employee of any Acquired Company, nor any
        other Person associated with or acting for or on behalf of the Business or any
        Acquired Company, has directly or indirectly (a) made any contribution, gift,
        bribe, rebate, payoff, influence payment, kickback or other payment to any
        Person, private or public, regardless of form, whether in money, property or
        services (i) to obtain favorable treatment in securing business, (ii) to pay for
        favorable treatment for business secured, (iii) to obtain special concessions or
        for special concessions already obtained, for or in respect of the Business, any
        Acquired Company or any Related Person of an Acquired Company, or (iv) in
        violation of any Legal Requirement, or (b) established or maintained any fund or
        asset that has not been recorded in the books and records of the Acquired
        Companies. 





	
                3.24	
                DISCLOSURE.





	
        (a)	
No representation or warranty of Seller in this Agreement and no statement in
any Schedule attached hereto omits to state a material fact necessary to make
the statements herein or therein, in light of the circumstances in which they
were made, not misleading. 





	
        (b)	
No notice given pursuant to Section 5.5 will contain any untrue statement
or omit to state a material fact necessary to make the statements therein or in
this Agreement, in light of the circumstances in which they were made, not
misleading. 





	
        (c)	
There is no fact known to Seller that has specific application to Seller or any
Acquired Company (other than general economic or industry conditions) and that
materially adversely affects the assets, business, prospects, financial
condition, or results of operations of the Business or Acquired Companies (on a
consolidated basis) that has not been set forth in this Agreement. 





	
                3.25	
RELATIONSHIPS WITH RELATED PERSONS. Neither Seller nor any
Related Person of Seller or of any Acquired Company currently has, or since
January 1, 1998 has owned (of record or as a beneficial owner), an equity
interest or any other financial or profit interest in, a Person that has (i) had
business dealings or a material financial interest in any transaction with any
Acquired Company other than business dealings or transactions conducted in the
Ordinary Course of Business with the Acquired Companies at substantially
prevailing market prices and on substantially prevailing market terms except for
less than one percent (1%) of the outstanding capital stock of any such business
that is publicly traded on any recognized exchange or in the over-the-counter
market. Except as set forth in Schedule 3.25, neither Seller nor any
Related Person of 






37




	
         	
        Seller or of any Acquired Company is a party to any Contract
        with, or has any claim or right against, any Acquired Company. 





	
                3.26	
        BROKERS OR FINDERS. Except as set forth in Schedule
        3.26, Seller and its agents have incurred no obligation or liability,
        contingent or otherwise, for brokerage or finders’ fees or agents’
        commissions or other similar payment in connection with this Agreement. 





	
                4.	
        REPRESENTATIONS AND WARRANTIES OF BUYER.  Buyer represent and warrant
        to Seller as follows:





	
                4.1	
        ORGANIZATION AND GOOD STANDING.  Buyer is a corporation duly organized,
        validly existing and in good standing under the laws of Finland.





	
                4.2	
        AUTHORITY; NO CONFLICT.





	
        (a)	
        This Agreement constitutes the legal, valid and binding obligation of Buyer,
        enforceable against Buyer in accordance with its terms. Upon the execution and
        delivery by Buyer of the Shareholders Agreement (the “Buyer’s
        Closing Documents”), the Buyer’s Closing
        Documents will constitute the legal, valid and binding obligations of Buyer,
        enforceable against Buyer in accordance with their respective terms. Buyer has
        all the necessary rights, power and authority to execute and deliver this
        Agreement and the Buyer’s Closing Documents and to perform its obligations
        under this Agreement and the Buyer’s Closing Documents. 





	
        (b)	
        Except as set forth in Schedule 4.2, neither the execution and delivery
        of this Agreement by Buyer nor the consummation or performance of any of the
        Contemplated Transactions by Buyer will contravene, conflict with or result in a
        violation of or give any Government or other Person the right to challenge,
        prevent, delay or otherwise interfere with any of the Contemplated Transactions
        or exercise any remedy or obtain any relief under or pursuant to: 






                (i) 
                any provision of Buyer's Organizational Documents;



                (ii) 
                any resolution adopted by the board of directors or the stockholders of
                Buyer;



                (iii) 
                any Legal Requirement or Order to which Buyer may be subject; or 



                (iv) 
                any Contract to which Buyer is a party or by which Buyer may be
                bound.


Except as set forth in
Schedule 4.2, Buyer is not and will not be required to give notice
or obtain any Consent from any Person in connection with the execution and
delivery of this Agreement or the consummation or performance of any of the
Contemplated Transactions. 


	
                4.3	
        CERTAIN PROCEEDINGS. There is no pending Proceeding that
        has been commenced against Buyer and that challenges, or may have the effect of






39




		
        preventing, delaying, making illegal or otherwise interfering with, any of the
        Contemplated Transactions. To the Knowledge of Buyer, no such Proceeding has
        been Threatened. 





	
                4.4	
        BROKERS OR FINDERS. Buyer and its officers and agents have
        incurred no obligation or liability, contingent or otherwise, for brokerage or
        finders’ fees or agents’ commissions or other similar payment in
        connection with this Agreement and will indemnify and hold Seller harmless from
        any such payment alleged to be due by or through Buyer as a result of the action
        of Buyer or its officers or agents. 





	
                5.	
        ADDITIONAL COVENANTS OF SELLER AND BUYER.





	
                5.1	
        ACCESS AND INVESTIGATION.





	
        (a)	
        Between the date of this Agreement and the Closing Date, Seller will, and will
        cause each Acquired Company and its Representatives to, (a) afford Buyer and its
        Representatives and prospective lenders and their Representatives (collectively,
        “Buyer’s Advisors”) reasonable access to
        each Acquired Company’s personnel, properties (including subsurface
        testing), contracts, books and records, and other documents and data, (b)
        furnish Buyer and Buyer’s Advisors with copies of all such material
        contracts, books and records, and other existing documents and data as Buyer may
        reasonably request, and (c) furnish Buyer and Buyer’s Advisors with such
        additional financial, operating and other data and information as Buyer may
        reasonably request. 





	
        (b)	
        In addition to any environmental investigations and audits conducted by Buyer or
        its Representatives prior to the date of this Agreement, Buyer shall be
        permitted to cause further environmental audits of the Facilities to be
        conducted as are reasonably necessary for assessing the presence and or
        disposition of Hazardous Materials and compliance with Environmental Laws,
        including such Phase II environmental audits as Buyer and Seller may mutually
        agree upon. Seller hereby agrees to permit Buyer’s qualified environmental
        consultants to enter upon the Facilities, upon giving Seller reasonable notice,
        with men and materials reasonably necessary to conduct such environmental
        audits. In connection with any such environmental audits and at the request of
        Seller, Buyer shall from time to time enter into agreements relating to
        indemnification for damages and confidentiality of audit results. 





	
                5.2	
        OPERATION OF THE BUSINESSES OF THE ACQUIRED COMPANIES.  Except as
        provided for in Section 6, between the Effective Time and the Closing Date,
        Seller will, and will cause each Acquired Company to:






                (i) 
                conduct the Business only in the Ordinary Course of Business and without any
                material deviation from the Base Business Plan;





39





                (ii) 
                use its Best Efforts
                to preserve intact the current business organization of the Business, keep
                available the services of the current officers, employees and agents of the
                Business and maintain the relations and good will with suppliers, customers,
                landlords, creditors, employees, agents and others having business relationships
                with the Business; 



                (iii) 
                consult with Buyer
                concerning operational matters of a material nature (subject to any Legal
                Requirement limiting any such consultation); and 



                (iv) 
                otherwise report
                periodically to Buyer concerning the status of the business, operations and
                finances of the Business and such Acquired Company. 


	
                5.3	
        NEGATIVE COVENANT. Except as otherwise expressly permitted
        by this Agreement, between the date of this Agreement and the Closing Date,
        Seller will not, and will cause each Acquired Company not to, without the prior
        written consent of Buyer, take any affirmative action, or fail to take any
        reasonable action within their or its control, as a result of which any of the
        changes or events listed in Section 3.16 is reasonably likely to occur. Without
        limiting the foregoing, Seller will cause the Acquired Companies not to incur
        any Indebtedness other than Permitted Indebtedness. 





	
                5.4	
        REQUIRED APPROVALS.





	
         (a)	
        As promptly as practicable after the date of this Agreement, Seller and Buyer
        will, and Seller will cause each Acquired Company to, make all filings required
        by Legal Requirements to be made by them in order to consummate the Contemplated
        Transactions, including all filings under any applicable Competition Laws of any
        other Governmental Body, including Council Regulation (EEC) No. 4064/89 or
        similar laws within Finland or other applicable jurisdictions such as France,
        Italy and the Czech Republic. In addition, each of Seller and Buyer agree that
        if any Governmental Body requests additional information under any applicable
        Competition Laws or any other Legal Requirement, it will use its reasonable
        commercial efforts to comply with such requests as promptly as possible. 




	
         (b)	
        Between the date of this Agreement and the Closing Date, Seller will, and will
        cause each Acquired Company to, (i) cooperate with Buyer with respect to all
        filings that Buyer required by Legal Requirements to make in connection with the
        Contemplated Transactions, and (ii) cooperate with Buyer in obtaining all
        consents identified in Schedule 4.2. provided that this Agreement will
        not require Seller to dispose of or make any change in any portion of its
        business or to incur any other burden to obtain a Governmental Authorization. 





	
         (c)	
        Between the date of this Agreement and the Closing Date, Buyer will, and will
        cause each Related Person to, (i) cooperate with Seller with respect to all
        filings that Seller is required by Legal Requirements to make in 






40




	
                  	
        connection with
        the Contemplated Transactions, and (ii) cooperate with Seller in obtaining all
        consents identified in Schedule 3.2; provided that this Agreement will
        not require Buyer to dispose of or make any change in any portion of its
        business or to incur any other burden to obtain a Governmental Authorization. 





	
                5.5	
        NOTIFICATION. Between the date of this Agreement and the
        Closing Date, either party will promptly notify the other party in writing if
        such party, including any Acquired Company becomes aware of any fact or
        condition that causes or constitutes a Breach of any of either party’s
        representations and warranties as of the Effective Time or as of the date of
        this Agreement (as applicable), or that party becomes aware of the occurrence
        after the date of this Agreement of any fact or condition that would (except as
        expressly contemplated by this Agreement) cause or constitute a Breach of any
        such representation or warranty had such representation or warranty been made as
        of the time of occurrence or discovery of such fact or condition. If any such
        fact or condition requires any change in any Schedule if the Schedule were dated
        the date of the occurrence or discovery of any such fact or condition, the party
        responsible for the Schedule will promptly deliver to other party a supplement
        to the Schedule specifying such change. During the same period, either party
        will promptly notify the other party of the occurrence of any Breach of any
        covenant of a party in this Agreement or of the occurrence of any event that may
        make the satisfaction of the conditions in the Agreement impossible or unlikely.






	
                5.6	
        NO NEGOTIATION. Until such time, if any, as this Agreement
        is terminated pursuant to Section 9, Seller will not, and will cause each
        Acquired Company and each of their Representatives not to, directly or
        indirectly solicit, initiate, or encourage any inquiries or proposals from,
        discuss or negotiate with, provide any non-public information to, or consider
        the merits of any unsolicited inquiries or proposals from, any Person (other
        than Buyer) relating to any transaction involving the sale of the business or
        assets (other than in the Ordinary Course of Business) of the Business or of any
        Acquired Company, or any of the capital stock of any Acquired Company, or any
        merger, consolidation, business combination, or similar transaction involving
        the Business and any Acquired Company. 





	
                5.7	
        BEST EFFORTS. Between the date of this Agreement and the
        Closing Date, both Buyer and Seller will use its Best Efforts to cause the
        conditions in Sections 7 and 8 to be satisfied except as set forth in the
        provisos to Sections 5.4(b) and 5.4(c), as applicable. 





	
                5.8	
STATUTE OF LIMITATIONS. Prior to the Closing, Seller shall
not permit any Acquired Company to agree with any Governmental Body to extend
the statute of limitations with respect to any Taxes, without the prior written
consent of Buyer. 





	
                5.9	
INTERIM FINANCIAL STATEMENTS. From the date of this
Agreement through the Closing Date, Seller will prepare monthly financial
statements for the Business and the Acquired Companies on a consolidated basis
(beginning with 






41




		
the month of January , 2002), and will promptly (and in any
event not later than the fifteenth Business Day following the end of the month
to which a statement relates) deliver them to Buyer. These unaudited financial
statements will be prepared in accordance with GAAP (except for the absence of
footnotes and subject to normal year end adjustments which will be immaterial in
amount) and in a manner consistent with the basis of presentation used in the
unaudited financial statements referred to in Section 3.4, and will fairly
present, in all material respects, the consolidated financial position and
results of operations, of the Business and the Acquired Companies as at and for
the periods indicated. 





	
                5.10	
MATTERS RELATING TO REAL PROPERTY. Each of the Acquired
Companies has full legal and beneficial title to any and all its real property
(“Real Property”), unless
otherwise disclosed in Schedule 5.10. All Real Property is free from any third
party rights, mortgages or other encumbrances whatsoever and is insured in
accordance with business practice. 





	
        6.	
CERTAIN ACTIONS PRIOR TO CLOSING DATE; TRANSITION AND EMPLOYEE MATTERS






	
        6.1	
THE ACQUIRED COMPANIES. Prior to the Closing Date, Seller
will take or cause to be taken all actions necessary or advisable to effectuate
the actions described on Attachment E to the Shareholders Agreement and
will cause the ownership of the Acquired Companies to be as set forth on
Attachment E to the Shareholders Agreement. 






	 	
        Without
        limiting the foregoing, Seller undertakes and agrees to incorporate the Company
        by on or prior to July 26, 2002 pursuant to Organizational Document the form and
        substance of which shall have been approved in advance by Buyer.





	 	
        Furthermore,
        and for the purposes of further clarity, Parties expressly agree that the Seller
        shall be obligated to ensure at its own cost that, in connection with the
        actions foreseen in the Attachment E to transfer the Business to the Acquired
        Companies, all the software and other licenses which relate to, support and/or
        have been used by the Seller or any of its Subsidiaries in connection with the
        Business shall have been transferred to the applicable Acquired Company on or
        before Closing, it being understood that the applicable Acquired Company shall
        be responsible for the payment of any customary fees which relate to the actual
        use of such licenses in the operation of the Business after the Closing.





	
        6.2	
        TRANSITION MATTERS.





At or prior to the Closing,
Buyer and Seller shall cause the Company to enter into the Shared Services
Agreement. 


	
        6.3	
        PAYMENT OF INDEBTEDNESS.





	
         (a)	
        Except as expressly provided in Paragraph (b) of this Section 6.3, Seller
        will cause all Indebtedness owed by any Acquired Company to Seller (or any
        Related Person of Seller), or owed to any Acquired Company by Seller (or any
        Related Person of Seller) to be paid in full prior to Closing, except that any
        account payable from Seller or any Related Person arising out of sales of goods
        or from any shared services will be paid in accordance with its terms. 





	
        (B)	
Seller will cause all Indebtedness owed by any Acquired Company to be paid in
full prior to Closing and will have caused the termination of all other
financing activities of the Company prior to the Closing (other than Permitted
Indebtedness or Indebtedness otherwise approved in writing by Buyer), it being
the general intent of the parties that the Acquired Companies shall be free of
Indebtedness other than Permitted Indebtedness as of the Closing (with the
provisions of Section 2.2 and the Closing Adjustment for Indebtedness being
intended to take into account any failure to effectuate such intent). 





	
        6.4	
        EMPLOYEES AND BENEFITS






                  
                  
                  
        6.4.1     
                Background.


	
        (a)	
        The Business has been managed, operated and maintained by employees of Seller or
        its Subsidiaries. Prior to the Closing Date, such employees have been
        compensated at established wage and salary rates, and some or all of such
        employees have had rights under some or all of the following: (i) employee
        benefit plans and (ii) published employment policies in effect at their
        respective work locations. All such benefit plans, published policies, and any
        other agreements or policies affecting employment are described in Schedule
        3.13(b). Seller’s salaried employees assigned to the Business (except
        those who at the Closing Date have retired or are on long-term disability, and
        those whom Buyer and Seller have excluded are herein called
        “Continuing Salaried Employees.” 





	
        (b)	
        The Continuing Salaried Employees will remain employed by the Company after the
        Closing under essentially the same terms and conditions as in effect immediately
        prior to the Closing Date. The Company will also continue the employment of all
        hourly employees after Closing at the Facilities (except those who are on
        layoff), herein called “Continuing Hourly
        Employees”. Continuing Salaried Employees and Continuing
        Hourly Employees are collectively referred to herein as “Continuing
        Employees”. Nothing in this Section will limit the right of
        the Company to terminate the employment or to make any adjustments, including
        both increases and decreases, in salary and benefits of any Continuing Employee
        at any time after the Closing Date. Except as otherwise provided in this
        Section, the Company will have absolute discretion with respect to the terms and
        conditions of employment of any Continuing Employee and other persons at any
        time employed by the Company, including the right to hire, terminate, promote,
        demote, transfer, reduce compensation or benefits or change the job status of
        any employee 






43




	
        
                  	
        of the Company at any time after the Closing Date. No provision of
        this Agreement is intended or will be construed as a promise or guaranty of the
        continued employment of any Continuing Employee or any other employee of either
        party. 





	
        6.5	
        INTERCOMPANY
        CONTRACTS. Seller and Buyer agree that all Contracts (written
        and oral) between (a) Seller and any of its affiliates and (b) the Acquired
        Companies will be terminated prior to the Closing unless otherwise mutually
        agreed upon by Buyer and Seller except for (i) those Contracts expressly
        contemplated by this Agreement, (ii) than purchase orders for goods in the
        ordinary course of Business and (iii) the lease for the Prague facility which is
        to be amended prior to Closing to provide that either party may terminate it
        only upon not less than 18 months notice. 






        7.          
        CONDITIONS PRECEDENT TO BUYER'S OBLIGATION TO CLOSE

        
                  
                
        Buyer's obligation to purchase the Shares and to take the other actions required
        to be taken by Buyer at the Closing is subject to the satisfaction, at or prior to
        the Closing, of each of the following conditions (any of which may be waived by Buyer,
        in whole or in part):


	
        7.1	
ACCURACY OF REPRESENTATIONS. All of Seller’s
representations and warranties in this Agreement (considered collectively), and
each of these representations and warranties (considered individually), must
have been accurate in all material respects as of the date of this Agreement
(or, in so far as they relate to the Company, as of the date of its
incorporation) or as of the Effective Time (as applicable), and must be accurate
in all material respects as of the Closing Date as if made on the Closing Date,
without giving effect to any supplement to any Schedule. 





	
        7.2	
SELLER'S PERFORMANCE.





	
        (a)	
All of the covenants and obligations that Seller is required to perform or to
comply with pursuant to this Agreement at or prior to the Closing (considered
collectively), and each of these covenants and obligations (considered
individually), must have been duly performed and complied with in all material
respects. 





	
        (b)	
        Each document required to be delivered pursuant to Section 2.4 must have
        been delivered, and each of the other covenants and obligations in Sections 5.4
        and 5.7 must have been performed and complied with in all respects. 





	
        7.3	
        CONSENTS.  Each of the Consents identified in Schedule 3.2
        must have been obtained and must be in full force and effect.





	
        7.4	
        ADDITIONAL DOCUMENTS.  Each of the following documents must have
        been delivered to or obtained by the Buyer:






44




	
        (a)	
        the employment agreements, in form and substance satisfactory to Buyer executed by
        Company and the Key Executives; and 





	
        [sic](a) 	
        such other documents as Buyer may reasonably request for the purpose of (i)
        evidencing the accuracy of any of Seller’s representations and warranties,
        (ii) evidencing the performance by Seller of, or the compliance by Seller
        with, any covenant or obligation required to be performed or complied with by
        Seller, (iii) evidencing the satisfaction of any condition referred to in
        this Section 7, or (iv) otherwise facilitating the consummation or
        performance of any of the Contemplated Transactions. 





	
        7.5	
        NO PROCEEDINGS. Since the date of this Agreement, there
        must not have been commenced or Threatened against Buyer, or against any Person
        affiliated with Buyer, any Proceeding (a) involving any challenge to, or
        seeking damages or other relief in connection with, any of the Contemplated
        Transactions, or (b) that may have the effect of preventing, delaying,
        making illegal, or otherwise interfering with any of the Contemplated
        Transactions. 





	
        7.6	
        NO CLAIM REGARDING SHARE OWNERSHIP OR SALE PROCEEDS. There
        must not have been made or Threatened by any Person any claim asserting that
        such Person (a) is the holder or the beneficial owner of, or has the right
        to acquire or to obtain beneficial ownership of, any Shares or any stock of, or
        any other voting, equity or ownership interest in, any of the other Acquired
        Companies, or (b) is entitled to all or any portion of the Purchase Price
        payable for the Shares. 





	
        7.7	
        NO PROHIBITION. Neither the consummation nor the
        performance of any of the Contemplated Transactions will, directly or indirectly
        (with or without notice or lapse of time), materially contravene, or conflict
        with, or result in a material violation of, or cause Buyer or any Person
        affiliated with Buyer to suffer any material adverse consequence under,
        (a) any applicable Legal Requirement or Order, or (b) any Legal
        Requirement or Order that has been published, introduced or otherwise formally
        proposed by or before any Governmental Body. 





	
        7.8	
        JV CLOSINGS.  The JV Closings shall have been completed.






        8.        
        CONDITIONS PRECEDENT TO SELLER'S OBLIGATION TO CLOSE



          
     Seller’s obligation
to sell the Shares and to take the other actions required to be
taken by Seller at the Closing is subject to the satisfaction, at or prior to the
Closing, of each of the following conditions (any of which may be waived by Seller,
in whole or in part):


	
        8.1	
        ACCURACY OF REPRESENTATIONS. All of Buyer’s
        representations and warranties in this Agreement (considered collectively), and
        each of these representations and warranties (considered individually), must
        have been accurate in all material respects as of the date of this Agreement and
        must be accurate in all material respects as of the Closing Date as if made on
        the Closing Date. 






45




	
        8.2	
        BUYER'S PERFORMANCE





	
        (a)	
        All of the covenants and obligations that Buyer is required to perform or to
        comply with pursuant to this Agreement at or prior to the Closing (considered
        collectively), and each of these covenants and obligations (considered
        individually), must have been performed and complied with in all material
        respects. 





	
        (b)	
        Buyer must have delivered each of the documents required to be delivered by
        Buyer pursuant to Section 2.4, and each of the other covenants and obligations
        in Section 5.4 and 5.7 must have been performed and complied in all respects and
        (ii) made the cash payments required to be made by Buyer pursuant to Sections
        2.4(b)(i). 





	
        8.3	
        CONSENTS.  Each of the Consents identified in Schedule 3.2
        must have been obtained and must be in full force and effect.






        8.4     
        ADDITIONAL DOCUMENTS. Buyer must have caused to be delivered to Seller such
        other documents as Seller may reasonably request for the purpose
        of(a) evidencing the accuracy of any representation or warranty of Buyer,
        (b) evidencing the performance by Buyer of, or the compliance by Buyer
        with, any covenant or obligation required to be performed or complied with by
        Buyer, (c) evidencing the satisfaction of any condition referred to in this
        Section 8, or (d) otherwise facilitating the consummation of any of
        the Contemplated Transactions. 


	
        8.5	
        NO PROCEEDINGS. Since the date of this Agreement, there
        must not have been commenced or Threatened against Seller, or against any Person
        affiliated with Seller, any Proceeding (a) involving any challenge to, or
        seeking damages or other relief in connection with any of the Contemplated
        Transactions, or (b) that may have the effect of preventing, delaying, making
        illegal, or otherwise interfering with any of the Contemplated Transactions.
        





	
        8.6	
        NO CLAIM REGARDING SHARE OWNERSHIP OR SALE PROCEEDS. There
must not have been made or Threatened by any Person any claim asserting that
such Person (a) is the holder or the beneficial or the beneficial owner of, or
has the right to acquire or to obtain beneficial ownership of, the Shares or any
stock of, or any other voting, equity or ownership interest in, any of the other
Acquired Companies, or (b) is entitled to all or any portion of the Purchase
Price payable for the Shares.





	
        8.7	
        NO PROHIBITION. Neither the consummation nor the
        performance of any of the Contemplated Transactions will, directly or indirectly
        (with or without notice or lapse of time), materially contravene, or conflict
        with, or result in a material violation of, or cause Seller or any Person
        affiliated with Seller to suffer any material adverse consequence under (a) any
        applicable Legal Requirement or Order, or (b) any Legal Requirement or Order
        that has been published, introduced or otherwise formally proposed by or before
        any Governmental Body.






46





        8.8 . JV CLOSINGS. The JV Closings shall have been
        completed.



        9.  TERMINATION.



        9.1 TERMINATION EVENTS.  This Agreement may, by notice given
        prior to or at the Closing, be terminated:


	
        (a)	
        by either Buyer or Seller if a material Breach of any provision of this
        Agreement has been committed prior to Closing by the other party and such Breach
        has not been waived; 





	
        (b)	
        (i) by Buyer if any of the conditions in Section 7 has not been satisfied as of
        the Closing Date or if satisfaction of such a condition is or becomes impossible
        (other than through the failure of Buyer to comply with its obligations under
        this Agreement) and Buyer has not waived such condition on or before the Closing
        Date; or (ii) by Seller, if any of the conditions in Section 8 has not been
        satisfied of the Closing Date or if satisfaction of such a condition is or
        becomes impossible (other than through the failure of Seller to comply with its
        obligations under this Agreement) and Seller has not waived such condition on or
        before the Closing Date; 





	
        (c)	
                by mutual consent of Buyer and Seller; or





	
        (d)	
        by either Buyer or Seller if the Closing has not occurred (other than through
        the failure of any party seeking to terminate this Agreement to comply fully
        with its obligations under this Agreement) on or before September 30, 2002 (the
        “Target Date”), or such later date as the parties
        may agree upon. If any Governmental Body with jurisdiction over the enforcement
        of any Competition Laws requests additional information relating to the JV
        Transactions or the parties and/or if any waiting period has not expired or any
        clearance or approval under any such Competition Law has not been satisfied or
        obtained by the Target Date, the Target Date will automatically be extended for
        such period of time as may be reasonably necessary for the parties to have
        complied with the Competition Laws and all such requests for information
        thereunder to the extent applicable to the JV Transactions, but in no event
        shall the Target Date be extended by this sentence beyond December 31, 2002. 






        9.2  EFFECT OF TERMINATION. Each party’s right of termination
        under Section
        9.1 is in addition to any other rights it may have under this Agreement or
        otherwise, and the exercise of a right of termination will not be an election of
        remedies. If this Agreement is terminated pursuant to Section 9.1, all
        further obligations of the parties under this Agreement will terminate, except
        that the obligations in Sections 11.1 and 11.3 will survive; provided, however,
        that if this Agreement is terminated by a party because of the Breach of this
        Agreement by the other party or because one or more of the conditions to the
        terminating party’s obligations under this Agreement is not satisfied as a
        result of the other party’s failure to comply with its obligations under
        




47





                this Agreement, the terminating party’s right to pursue all legal remedies
        will survive such termination unimpaired. 



        10. INDEMNIFICATION; REMEDIES;
        DISPUTE RESOLUTION



        10.1 SURVIVAL; RIGHT TO INDEMNIFICATION NOT AFFECTED BY KNOWLEDGE;
        DEFINITIONS.



        (a) 
        All representations,
        warranties, covenants and obligations in this Agreement, the Schedules, the
        supplements to the Schedules, the certificate delivered pursuant to Section
        2.4(a)(ii) and any other certificate or document delivered pursuant to this
        Agreement will survive the Closing as set forth in this Article 10. Except as
        expressly provided for in Section 10.2(b) and the last Section of 10.2, the
        right to indemnification, payment of Damages or other remedy based on such
        representations, warranties, covenants and obligations will not be affected by
        any investigation conducted with respect to, or any Knowledge acquired (or
        capable of being acquired) at any time, whether before or after the execution
        and delivery of this Agreement or the Closing Date, with respect to the accuracy
        or inaccuracy of or compliance with, any such representation, warranty, covenant
        or obligation, and the waiver of any condition based on the accuracy of any
        representation or warranty, or on the performance of or compliance with any
        covenant or obligation, will not affect the right to indemnification, payment of
        Damages or other remedy based on such representations, warranties, covenants and
        obligations. 



        (b) 
        For purposes of this
        Article 10, the following terms have the meanings specified or referred to in
        this Section 10.1(b): 



          
“Buyer Indemnified Persons” -- means Buyer, OCP, the Acquired
Companies and their respective Representatives and Related Persons.



          
“Seller Indemnified Persons”-- means Seller and its
Representatives and Related Persons.



          
“Damages” -- means any loss, liability, claim, damage (including
incidental and consequential damages), expense (including costs of
investigation and defense and reasonable attorneys’ fees and expenses of attorneys,
accountants, engineers and other experts and consultants), fine,
penalty or obligation, whether or not involving a third-party claim relating to the
Company, its Business (as defined in this Agreement) or USJVCO and its
Business (as defined in the Joint Venture and Member’s Agreement.



          
“Indemnified Party” -- any Person entitled to indemnification
under this Article 10.



          
“Indemnifying Party” -- any Person required to indemnify another
Person under this Article 10.



48





       10.2
                INDEMNIFICATION AND PAYMENT OF DAMAGES BY SELLER.
        Seller will indemnify and hold
        harmless the Buyer Indemnified Persons, for, and will pay to the Buyer
        Indemnified Persons the amount of, any Damages, arising, directly or indirectly,
        from or in connection with: 



        (a) 
        any Breach of any
        representation or warranty made by Seller in this Agreement or by Seller or any
        Related Person thereof in the US Share Purchase Agreement (without giving effect
        to any supplement to any Schedule) or any other certificate or document
        delivered by Seller or such Related Person pursuant to this Agreement or the US
        Share Purchase Agreement (provided, however, that this Section 10.2(a) shall
        only apply if the Closing shall not occur), 



        (b) 
        any Breach of any
        representation or warranty made by Seller in this Agreement or by Seller or any
        Related Person thereof in the US Share Purchase Agreement as if such
        representation or warranty were made on and as of the Closing Date (without
        giving effect to any supplement to any Schedule), other than any such Breach
        that is disclosed in a supplement to any Schedule and is expressly identified in
        the certificate delivered pursuant to Section 2.4(a)(ii) as having caused the
        condition specified in Section 7.1 not to be satisfied; 



                (c) 
         any Breach by Seller
        of any covenant or obligation of Seller in this Agreement
        or by Seller or any Related Person thereof in the US Share Purchase
        Agreement;



        (d) 
        the operation of the
        Business prior to the Closing Date, including but not limited to Damages
        relating to (i) any unpaid employee-related costs, expenses and Taxes (and any
        fines or penalties for non-payment thereof) that have not been accrued or
        reserved as a liability in determining the Closing Date Net Assets and (ii) any
        product shipped by, or any services provided by the Business or any Acquired
        Company or by the US JVCo or any subsidiary or predecessor thereof prior to the
        Closing Date; 



        (e) 
        any activities of any Acquired Company that are not related to the Business
        as conducted as of the Closing Date;



        (f) 
        the Proceedings and matters disclosed in Schedule 3. 15 and
        Schedule 3.15 to the US Share Purchase Agreement; or



        (g) 
        any claim by any Person
        for brokerage or finder’s fees or commissions or similar payments based
        upon any agreement or understanding made by any such Person with Seller or any
        Acquired Company (or any Person acting on their behalf or on behalf of the
        Business for which they are responsible) in connection with any of the
        Contemplated Transactions or the transactions contemplated by the US Share
        Purchase Agreement. 



          
Notwithstanding the provisions of clauses (a) and (b) of this Section 10.2, to the
extent that Seller can prove (and Seller has the burden of proof in that regard)
that Buyer had Knowledge that any of Seller's representations or warranties contained
in this Agreement or in the US Share Purchase Agreement were false at the 



49




time such
agreement was signed, Seller shall have no indemnification obligation for the Breach
of such representation or warranty.



        10.3        INDEMNIFICATION
        AND PAYMENT OF DAMAGES BY SELLER - LOSSES. Seller shall indemnify
        and hold harmless the Buyer Indemnified Persons, for losses based on EBIT, if
        any, incurred by the Company during the period commencing on the Closing Date
        and ending 31 December 2002 (“Relevant Period”) up to an aggregate
        amount of one million US Dollars ($ 1,000,000) . The Seller and the Purchaser
        shall procure that as soon as possible after the approval of the audited
        financial statements of the Company and the verification of any losses, if any,
        incurred by the Company on a consolidated basis during the Relevant Period, the
        Company shall issue to each of the Seller and the Buyer the smallest possible
        number of the kind of shares in the Company each of the Seller and Buyer already
        holds that preserves the share proportions existing at that time. The amount to
        be paid up on the shares issued shall equal the amount of the losses incurred by
        the Company on a consolidated basis during the Relevant Period, with a maximum
        of one million US Dollars (US$ 1,000,000) and the Seller undertakes that it
        shall pay to the Company the amounts of the contribution on the shares issued
        thus payable by the Buyer and the Seller. Upon such payment by the Seller on
        behalf of the Buyer, the Seller is discharged for its indemnification
        obligations as mentioned above. The audited financial statements of the Company
        with respect to the fiscal year 2002 will be prepared and audited consistent
        with the preparation and audit of the Financial Statements. However,
        notwithstanding the foregoing, the parties agree that the Seller shall not be
        responsible for indemnifying or holding harmless the Buyer Indemnified Persons
        for any losses incurred during the Relevant Period which arise out of any
        material decision after the Closing by the Company which is not foreseen in the
        Base Business Plan or which has not been agreed to by the Seller or the majority
        of its representatives appointed to the Board of the Company. 


Notwithstanding the
foregoing, the Seller shall indemnify, without limitation, and hold harmless the
Buyer Indemnified Persons from and against any loss, liability, damage, cost and
expenses whatsoever incurred outside the operation of the Business, in
particular in relation to the formation and operation of SCI Groupe Brancher or
its conversion into a French Société par Actions Simplifiée and
arising from or in connection with any event which is not directly connected
with or attributable to the Heatcraft activity and the operation of the factory
of Cremieu (France). 



        10.4         INDEMNIFICATION AND PAYMENT OF DAMAGES BY SELLER --
ENVIRONMENTAL MATTERS.



                  
        10.4.1
        Indemnification.  In addition to the provisions of Section 10.2,
        Seller will indemnify and hold harmless the Buyer
        Indemnified Persons for,
        and will pay to Buyer, the Acquired Companies and the other Buyer Indemnified
        Persons the amount of, any Damages (including costs of investigation, cleanup,
        containment or other remediation and associated operation, maintenance and
        monitoring) arising, directly or indirectly, from or in connection with: 




50





        (a) 
        any Environmental,
        Health and Safety Liabilities arising out of or relating to: (i) (A) the
        ownership, operation or condition at any time on or prior to the Closing Date of
        the Facilities or any other properties and assets (whether real, personal or
        mixed and whether tangible or intangible) in which Seller, any Heat Transfer
        Existing Subsidiary or any Acquired Company has or had an interest, including
        specifically any fact, event, condition, circumstance, incident, operation or
        practice identified or covered in any of the reports listed in Schedule
        3.19, or (B) any Hazardous Materials or other contaminants that were present
        on the Facilities or such other properties and assets at any time on or prior to
        the Closing Date; or (ii) (A) any Hazardous Materials or other contaminants,
        wherever located, that were generated, transported, stored, treated, Released or
        otherwise handled by Seller, any Heat Transfer Existing Subsidiary or any
        Acquired Company or by any other Person for whose conduct they are or may be
        held responsible at any time on or prior to the Closing Date, or (B) any
        Hazardous Activities with respect to the Facilities or relating to the Business
        that were conducted by Seller, any Heat Transfer Existing Subsidiary or any
        Acquired Company or by any other Person for whose conduct they are or may be
        held responsible, including specifically any fact, event, condition,
        circumstance, incident, operation or practice identified in or covered by any of
        the reports listed in Schedule 3.19; or 



        (b) 
        any bodily injury
        (including illness, disability and death, and regardless of when any such bodily
        injury occurred, was incurred or manifested itself), personal injury, property
        damage (including trespass, nuisance, wrongful eviction and deprivation of the
        use of real property), or other damage of or to any Person, including any
        employee or former employee of Seller, any Heat Transfer Existing Subsidiary or
        any Acquired Company or any other Person for whose conduct they are or may be
        held responsible, in any way arising from or allegedly arising from any
        Hazardous Activity conducted with respect to the Facilities or the operation of
        the Acquired Companies, any Heat Transfer Existing Subsidiary or the Business
        prior to the Closing Date, including any fact, event, condition, circumstance,
        incident, operation or practice identified in or covered by any of the reports
        listed in Schedule 3.19, or from Hazardous Material that was (i) present on or
        before the Closing Date on or at the Facilities (or present or suspected to be
        present on any other property, if such Hazardous Material emanated from any of
        the Facilities and was present on any of the Facilities on or prior to the
        Closing Date), including specifically any fact, event, condition, circumstance,
        incident, operation or practice identified in or covered by any of the reports
        listed in Schedule 3.19 or (ii) Released by Seller, any Heat Transfer
        Existing Subsidiary or any Acquired Company or any other Person for whose
        conduct they are or may be held responsible, at any time on or prior to the
        Closing Date, including specifically any fact, event, condition, circumstance,
        incident, operation or practice identified in or covered by any of the reports
        listed in Schedule 3.19. 



        10.4.2 
        Environmental Management.



        (c) 
        Contractual Predicate:



        (i) 
        The reports listed on
        Schedule 3.19 or the additional Phase II reports prepared under Section
        5.1 (b) identify operating practices of the Acquired Companies or their
        predecessors and/or physical conditions at one or more of the Facilities which
        are not in 



51





        full compliance with Environmental Law and/or which create latent or
        actual Environmental, Health and Safety Liabilities. 



        (ii) 
        Under Section 10.4.1,
        Seller is obligated to indemnify and hold harmless Buyer, the Acquired Companies
        and the other Buyer Indemnified Persons for and has agreed to pay Buyer, the
        Acquired Companies and the other Buyer Indemnified Persons the amount of any
        Damages arising, directly or indirectly, from or in connection with
        Environmental, Health and Safety Liabilities. 



        (iii) 
        The liabilities
        associated with the matters identified in the reports listed on Schedule
        3.19 are covered by Seller’s indemnification and payment obligations
        under Section 10.4.1. The purpose of this Section 10.4.2 is to provide for the
        efficient administration of the rights of Seller, Buyer, the Acquired Companies
        and the other Buyer Indemnified Persons and the obligations of Seller under
        Section 10.3. 



        (d) 
        Management Framework:



        (i) 
        All of the tasks
        necessary to manage and/or resolve the Environmental, Health and Safety
        Liabilities, including Cleanup, arising from the matters identified in the
        reports listed in Schedule 3.19 and any other Environmental, Health and
        Safety Liabilities for which Seller is obligated to provide indemnity and pay
        Damages under Section 10.4.1, including Cleanup, constitutes the
        “Work” to be governed by this Section 10.4. 



        (ii) 
        Seller and its Representatives shall manage the Work.  Buyer will be given
        the opportunity to participate in the Work as defined in the subsequent
        provisions of this section.



        (iii) 
        Seller hereby
        appoints Mark Yohman to serve as its initial overall project coordinator
        (“PC”) for the Work. Buyer hereby appoints Earl Robinson to
        serve as its initial representative (“OR”) to review and
        provide input on the Work. Either party may change its appointed representative
        by written notice to the other. The rights and responsibilities of the PC and
        the OR with respect to managing the Work and /or any Cleanup are as follows:
        


		(A)	
        The PC, with the OR’s concurrence, will select such
        environmental/engineering firms as may be necessary to plan and carry out the
        Work. The PC, with the OR’s concurrence, can change or supplement such
        environmental/engineering firms as necessary to efficiently and effectively
        carry out the Work.





		(B)	
        The PC and OR in consultation with the environmental/ engineering firms, will
        jointly develop long-range plans, budgets, schedules and execution strategies
        (for at least one year in advance) for the Work.





		(C)	
        The PC, OR and engineering/environmental consulting firms will jointly develop
        project specific scopes of work and related work plans.






52




		(D)	
        The PC will take the lead in managing the environmental/ engineering firms. The
        firms will be instructed to provide duplicate originals of all written
        correspondence including teleconferencing communications and work products, to
        the PC and the OR simultaneously.





		(E)	
        The PC shall require performance of the Work according to each project’s
        schedule; that schedule will reflect that the Work must be performed
        economically and expeditiously.





		(F)	
        All relevant correspondence and work products generated by Buyer, Seller or
        their respective Representatives or by the environmental/engineering firms
        engaged to perform any Work, or received by Buyer, Seller or their respective
        Representatives from any environmental/engineering firms or any Governmental
        Bodies, will be transmitted to the other party as soon as practicable, to the
        extent that such material has not already been forwarded directly.





		(G)	
        The PC will be responsible for dealing with all Governmental Bodies, but the PC
        shall give the OR prompt notice of all scheduled meetings, conference calls and
        other pre-arranged conversations with Governmental Bodies and shall allow the OR
        to attend or participate in all scheduled meetings, conference calls and other
        pre-arranged conversations with such Governmental Bodies which relate to the
        Work at any of the Facilities. The OR will be given a reasonable time in advance
        to review, discuss and propose modifications to the timing or content of any
        proposed communication with such agencies which pertain to the Work.





		(H)	
        The PC and the OR will jointly develop negotiating positions and strategies for
        communicating with the Governmental Bodies about the process for evaluating and
        selecting Cleanup or other remedies, compliance strategies or other necessary
        actions.





		(I)	
        If the PC and OR disagree on any element of the Work (including plans, Cleanup
        or other execution strategies, scopes of the Work, work plans, schedules,
        budgets or contract terms of the Work proposals) or on the content or timing of
        any communication to a Governmental Body or if the OR believes that the PC is
        failing to diligently attend to or prosecute any element of the Work,
        (collectively, “ENV Disagreements”), the OR shall
        promptly and concisely state its position in writing. The PC shall give due
        consideration to the LR’s position, and the PC shall then make a
        determination which, subject to Paragraph (J) below, resolves the ENV
        Disagreement.





		(J)	
        If the OR or Buyer requests, the PC’s decision will be subject to review by
        the CEO of Buyer and Seller, after a meeting or 






53




			
        telephone conference between the
        CEO of Buyer and the CEO of Seller. After the foregoing review, Buyer will have
        the authority to resolve any ENV Disagreement and to effect any actions with
        respect to the Work with any Governmental Body; provided, however, that Seller
        will no longer be obligated to indemnify Buyer or any other Buyer Indemnified
        Person. At the election of the Buyer, the dispute may be submitted to a
        qualified independent third party for resolution. The parties will select this
        party by mutual agreement, all costs for the review will be shared equally by
        Buyer and Seller and any decisions will be governed by the principle that any
        Work performed must be that necessary to comply with any applicable Legal
        Requirement and in the most cost-effective manner.





		(K)	
        If the manner in which Seller is managing any element of the Work negatively
        impacts or harms the Business (with any ENV Disagreement regarding the same to
        be resolved as provided in paragraph (J) above), Buyer will have the right to
        assume management of such Work by notice to Seller.





	
                  
        (e)	
        Cost Control:  The PC and Buyer will take all reasonable steps to insure
        the project costs which are subject to payment by Seller or Company
        are closely monitored and controlled.





	
                  
        (f)	
        Project Controls: Every environmental/engineering firm who performs any Work
        shall prepare periodic written progress reports in a format jointly developed by
        the PC and OR for the specific tasks and projects they are contracted to
        perform. Each environmental/ engineering firm shall also be available to confer
        with the PC and the OR as the PC and the OR determine is necessary, about the
        Work. 





	
                  
        (g)	
        Funding/Invoicing Procedures:






        (i) 
        Each
        environmental/engineering firm who performs any Work shall submit invoices for
        payment in a form developed jointly by both the PC and the OR. Invoices must be
        sent to both the PC and OR concurrently. The OR shall communicate any questions
        about or objections to any environmental/engineering firm invoice within thirty
        (30) days after receipt. After completing its review, and conferring with the OR
        the PC shall make a decision concerning payment of the invoice. On determining
        that an invoice is to be paid, the PC shall arrange for such payment to be by
        Seller, which payment will be made by Seller in its ordinary accounts payable
        cycle unless Paragraph (ii) below applies. 



        (ii) 
        If the OR and Buyer
        disagree with the PC’s decision as to payment of any invoice amount, Seller
        or Buyer shall deliver a Dispute Notice (as defined in Section 9.13(a)) with
        respect to any portion or the entire all of the invoice. In such event the
        Dispute will be resolved pursuant to Section 10.13. If it is ultimately
        determined pursuant to Section 10.13 that Seller is required to pay any amount
        which was the subject of a 




54





        Dispute Notice sent pursuant to this section, Seller
        shall pay such amount to the Company. 



             10.4.3
         Procedure.Notwithstanding Section 10.4.2,
        the procedure described in Section 10.12 will apply to any claim solely for monetary
        damages relating to a matter covered by this Section 10.4.



        10.5         INDEMNIFICATION AND PAYMENT OF DAMAGES BY SELLER - TAX MATTERS
        .



                  
             10.5.1
         General.



        (a) 
        In addition to the
        provisions of Section 10.2, Seller shall indemnify each Buyer Indemnified Person
        and hold them harmless from (i) all liability for Taxes that may be imposed or
        assessed against the Acquired Companies (which for purposes only of this Section
        10.5 shall include the Acquired Companies and the entities set forth on
        Schedule 10.4.1(a) or the assets of the Acquired Companies based on
        income attributable to all taxable periods ending on or before the Closing Date
        reduced without duplication by the actual payment of Taxes prior to the Closing
        Date and any reserves with respect to Taxes set forth on the Balance Sheet, (ii)
        all liability for Taxes of any Person (other than any of the Acquired Companies)
        with which any of the Acquired Companies is or has been affiliated or has filed
        or has been required to file a consolidated, combined or unitary Tax Return, and
        (iii) subject to the last sentence of Section 10.5.2(b), all liability for
        reasonable legal, accounting, consulting or similar fees and expenses for any
        item attributable to any item in clauses (i) or (ii) of this sentence.(b) In the
        case of any taxable period that includes (but does not end on) the Closing Date
        (a “Straddle Period”): 



        (i) 
        real, personal and
        intangible property Taxes (“Property Taxes”) of
        the Acquired Companies attributable to all taxable periods ending on or before
        the Closing Date will be equal to the amount of such property Taxes for the
        entire Straddle Period multiplied by a fraction, the numerator of which is the
        number of days during the Straddle Period that are in all taxable periods ending
        on or before the Closing Date and the denominator of which is the number of days
        in the Straddle Period; and 



        (ii) 
        the Taxes of the
        Acquired Companies (other than Property Taxes) attributable to all taxable
        periods straddling the Closing Date will be computed as if such taxable period
        ended as of the close of business on the Closing Date and, in the case of any
        Taxes attributable to the ownership by any of the Acquired Companies of any
        equity interest in any non-U.S. corporation, partnership or other “flow
        through” entity, as if a taxable period of such corporation, partnership or
        other “flow through” entity ended as of the closing of business on the
        Closing Date. 



                  
             10.5.2
         Tax Indemnification Procedures



                (c) 
        If a claim is made by
        any Governmental Body, which, if successful, would result in an indemnity
        payment to any Indemnified Person pursuant to Section 10.5.1, then the Company
        shall give notice to Seller in writing of such claim within thirty (30) days
        after 



55





        receipt of such a claim (a “Tax Claim”);
        provided, however, the failure to give such notice shall not affect the
        indemnification provided pursuant to Section 10.5.1 except to the extent that
        Seller has been actually prejudiced as a result of such failure. Notice to
        Seller hereunder will constitute notice to Seller. 



        (d) 
        With respect to any Tax
        Claim relating to a taxable period ending on or prior to the Closing Date,
        Seller shall control all proceedings and may make all decisions taken in
        connection with such Tax Claim (including selection of counsel) and, without
        limiting the foregoing, may in its sole discretion pursue or forego any and all
        administrative appeals, proceedings, hearings and conferences with any
        Governmental Body with respect thereto, and may, in its sole discretion, either
        pay the Tax claimed and sue for a refund where applicable law permits such
        refunded suits or contest the Tax Claim in any permissible manner; provided,
        however, that Seller must first consult in good faith with Buyer before taking
        any action with respect to the conduct of a Tax Claim. 



        (e) 
        Seller and Buyer shall
        jointly control and participate in all proceedings taken in connection with any
        Tax Claim relating to Taxes of the Acquired Companies for a Straddle Period.
        Neither Seller nor Buyer shall settle any such Tax Claim without the prior
        written consent of the other parties. Each party shall pay its own expenses with
        respect to any such Tax Claim.(f) The Company shall control all proceedings with
        respect to any Tax Claim relating to a taxable period beginning after the
        Closing Date. 



        (g) 
        Buyer and the Acquired
        Companies on the one hand, and Seller on the other, shall reasonably cooperate
        in contesting any Tax Claim, which cooperation will include the retention and,
        upon request, the provision to the requesting Person of records and information
        which are reasonably relevant to such Tax Claim, and making employees available
        on a mutually convenient basis to provide additional information or explanation
        of any material provided hereunder or to testify at proceedings relating to such
        Tax Claim. 



                  
        10.5.3
        Transfer and Similar Taxes.  Seller
shall pay and shall hold each Buyer Indemnified Person harmless from all transfer,
documentary, sales, use,
registration and similar Taxes (including all applicable real estate transfer or
gains taxes and state transfer taxes, and related fees, including any penalties
interest and additions to Tax) (“Transfer
Taxes”). The procedures set forth in Section 10.5.1 apply to
Transfer Taxes. On or prior to the Closing, Seller shall present Tax receipts or
other documents, satisfactory to Buyer, demonstrating that all Transfer Taxes
have been paid in full. 



        10.6
        INDEMNIFICATION AND PAYMENT BY SELLER - TRANSACTION EXPENSES.
        



        (a) 
        Prior to the Closing
        Date, Seller shall have requested final invoices from all relevant third parties
        (including accountants, attorneys and other similar professionals) reflecting
        all fees and expenses payable by Seller and the Acquired Companies with respect
        to services rendered in connection with the transactions contemplated hereby and
        by the US Share Purchase Agreement. Not later than three (3) Business Days prior
        to the Closing Date, the chief financial officer of Seller shall certify in
        writing to Buyer the 



56





        amount of (i) any Transaction Expenses that will have been
        paid by Seller or any Acquired Company immediately prior to the Closing Date,
        (ii) an estimate of any Transaction Expenses incurred but not paid as of the
        Closing Date, and (iii) an estimate of any Transaction Expenses reasonably
        expected to be incurred after the Closing Date. 



        (b) 
        In addition to the
        provisions of Section 10.2, Seller agrees to indemnify, defend and hold the
        Buyer Indemnified Persons harmless from and against any and all losses that the
        Buyer Indemnified Persons may suffer, sustain, incur or become subject to
        arising out of or due to the failure of Seller to pay in full all Transaction
        Expenses. Any amounts to be paid under this Section 10.5 by Seller to a Buyer
        Indemnified Person shall be paid by Seller immediately upon receipt of written
        notice from Buyer demanding payment. 



        10.7 
        INDEMNIFICATION
        AND PAYMENT OF DAMAGES BY BUYER.Buyer and OCP agree, jointly and
        severally, to indemnify and hold harmless the Seller Indemnified Persons, and
        will pay to Seller Indemnified Persons the amount of any Damages arising,
        directly or indirectly, from or in connection with: 



        (a) 
        any Breach of any
        representation or warranty made by Buyer in this Agreement or by Buyer or any
        Related Person thereof in the US Share Purchase Agreement (without giving effect
        to any supplement to any Schedule) or any other certificate or document
        delivered by Buyer or such Related Person pursuant to this Agreement or the US
        Share Purchase Agreement (provided, however, that this Section 10.7(a) shall
        only apply if the Closing shall not occur), 



        (b) 
        any Breach of any
        representation or warranty made by Buyer in this Agreement or by Buyer or any
        Related Person thereof in the US Share Purchase Agreement as if such
        representation or warranty were made on and as of the Closing Date (without
        giving effect to any supplement to any Schedule), other than any such Breach
        that is disclosed in a supplement to any Schedule and is expressly identified in
        the certificate delivered pursuant to Section 2.4(b)(ii) as having caused the
        condition specified in Section 8.1 not to be satisfied; 



        (c) 
        any Breach by Buyer of any covenant or obligation of Buyer in this Agreement
        or by Buyer or any Related Person thereof in the US Share Purchase
        Agreement;



        (d) 
        any claim by any Person
        for brokerage or finder’s fees or commissions or similar payments based
        upon any agreement or understanding made by such Person with Buyer (or any
        Person acting on its behalf) in connection with any of the Contemplated
        Transactions. 



        10.8  TIME LIMITATIONS.



        (a) 
        If the Closing occurs, Seller will have no liability (for indemnification or
        otherwise) with respect to:



        (i) 
        any representation or warranty unless notice is given to Seller in accordance
        with Section 10.11 or Section 10.12 prior to the expiration of the
        following periods:





57




		(A)	
        for the representations and warranties set forth in Sections 3.1 through 3.3,
        3.12, 3.14, 3.16, 3.20, 3.21 and 3.23 through 3.25 - two years after the Closing
        Date;





		(B)	
        (B) for the representations and warranties set forth in Sections 3.4 through 3.9, 3.13. 3.17, 3.18 and 3.22 - three years
        after the Closing Date;





		(C)	
        for the representations and warranties set forth in Sections 3.10, 3.15, 3.19
        and 3.26 - five years after the Closing Date; and





		(D)	
        for the representations and warranties set forth in Section 3.11 - 60 days
        following expiration of the applicable statute of limitations, or







        (ii) 
        any covenant or obligation to be performed and complied with prior to the
        Closing Date unless on or before the fourth anniversary of the Closing Date
        Buyer notifies Seller of a claim in accordance with Section 10.11 or Section
        10.12. Seller shall have no liability for indemnification or reimbursement (x)
        under Section 10.2 not based upon any representation or warranty, (y) under
        Section 10.4, 10.5 or 10.6, or (z) with respect to any covenant or obligation to
        be performed and complied with after the Closing Date, unless notice is given to
        Seller in accordance with Section 10.11 or Section 10.12 prior to the expiration
        of the periods (“Notice Periods”) set forth below:



(A)     
        For Section 10.4:


		(I)	
        With respect to any Known Environmental Liabilities,
                        the Notice Period shall continue in perpetuity.






          
          
          
(II)     
        With respect to any Environmental, Health and Safety
        Liabilities not identified in Schedule 3.15 (“Unknown
        Environmental Liabilities”), the Notice Period shall run from
        the Closing Date until
        the tenth (10th) anniversary of the Closing Date.  Seller shall be
        required to indemnify the Buyer Indemnified Persons for any Unknown Environmental Liabilities
        according to the following schedule:  For Unknown Environmental Liabilities notice of which is
        delivered to Seller prior to the eighth (8th) anniversary of the Closing Date - 100%; for Unknown
        Environmental Liabilities notice of which is delivered to Seller after the eighth (8th) anniversary,
        and prior to the ninth (9th) anniversary of the Closing Date - 67%; and for Unknown Environmental
        Liabilities notice of which is delivered to Seller after the ninth (9th), and prior to the tenth (10th)
        anniversary of the Closing Date - 33%.  Notwithstanding the foregoing provisions of this clause (II):
        (x) if Seller proves that any Release, act, omission or violation of Environmental Law giving rise to
        any Unknown Environmental Liability first occurred after the Closing Date, Seller shall have no indemnity
        obligation under this Agreement with respect to such Unknown Environmental Liability, and (y) with respect
        to a Release, act, omission or violation of Environmental Law giving rise to an Unknown
        Environmental Liability that first occurs before the Closing Date, if Seller can
        prove that an Acquired Company's acts or omissions after the Closing Date exacerbated 




58





         the conditions giving rise to such Unknown Environmental Liability, the Seller's indemnity
         obligation under Section 10.4 and as limited by this Section 10.8(a)(ii)(A)(II) will
         be reduced in equitable proportion to the respective contribution of Seller (or its
         Affiliates) and the Acquired Companies to the Unknown Environmental
         Liability.



          
          
          
          
(B)     
        For Section 10.2, except for Section 10.2 (d) and (e) for which
        there shall be no time limitation, (i.e., indemnity claims not based
        on a breach of any representation or warranty), 10.5 or 10.6 or for indemnity
        claims with respect to any covenant to be performed and complied with
        after the Closing Date, the Notice Period shall commence on the Closing
        Date and continue until the longer of (y) the fifth anniversary of the
        Closing Date or (z) 60 days after the applicable statute of limitations.
                



        (c) 
        If the Closing occurs,
        Buyer will have no liability (for indemnification or otherwise) with respect to
        any representation or warranty, or covenant or obligation to be performed and
        complied with prior to the Closing Date, unless on or before fifth anniversary
        of the Closing Date Seller notifies Buyer of a claim specifying the factual
        basis of that claim in reasonable detail to the extent then known by Seller. 



        (d) 
        If the Closing does not occur, Buyer and Seller will have liability under
        Section 10.7 or 10.2 (as applicable) only if notice is given to the other
        party within one year after this Agreement has been terminated.



        [sic](d) 
        The indemnifying party's obligations to indemnify for any matter
        notice of which is given within the applicable notice period will continue thereafter
        until satisfied.



        10.9 
        LIMITATIONS ON
        AMOUNT--SELLER. Seller will have no liability (for
        indemnification or otherwise) with respect to the matters described in Sections
        10.2(a)through 10.2(c) and Section 10.4 until Buyer has suffered Damages in
        excess of a $500,000 aggregate threshold (the “Threshold”) (at which
        point Seller will be obligated to indemnify Buyer from and against such Damages
        relating back to the first dollar). Notwithstanding the foregoing, there is no
        threshold with respect to Seller’s indemnification obligations under
        Section 10.2 (e) Section 10.3 10.4 with respect to Known Environmental
        Liabilities (provided, however, that if the Base Business Plan includes any
        accrual for or otherwise includes expenses specifically identical as intended to
        cover the cost of remediating any Known Environmental Liability, Seller shall
        indemnify the Buyer Indemnified Persons only for the amount of costs incurred in
        connection with such remediation in any year that are in excess of the accrual
        or other amounts expressly identified for such expenses in the Base Business
        Plan for that year or, for years after 2006, the amount accrued for 2006 in the
        Base Business Plan). For clarification purposes, there is also no Threshold with
        respect to Seller’s indemnification obligations under Section 10.2(d),
        Section 10.2(e), Section 10.2(g), Section 10.5 or Section 10.6. This Section
        10.9 does not apply to any Breach of any of Seller’s representations and
        warranties of which Seller had Knowledge at any time prior to the date on which
        such representation and warranty is made or any intentional Breach by Seller of
        any covenant or obligation, and Seller will be jointly and severally liable for
        all Damages with respect to such Breaches. The parties agree that the $ 500,000
        aggregate Threshold can be satisfied by Damages that are indemnifiable under
        this Agreement or the US Share Purchase Agreement. 




59





        10.10 
        LIMITATIONS ON
        AMOUNT--BUYER. Buyer will have no liability (for indemnification
        or otherwise) with respect to the matters described in clause (a) or (b) of
        Section 10.7 until Seller shall has suffered Damages in excess of a $500,000
        threshold (at which point Buyer will be obligated to indemnify Seller from and
        against such Damages relating back to the first dollar). However, this Section
        10.10 will not apply to any Breach of any of Buyer’s representations and
        warranties of which Buyer had Knowledge at any time prior to the date on which
        such representation and warranty is made or any intentional Breach by Buyer of
        any covenant or obligation, and Buyer will be liable for all Damages with
        respect to such Breaches. 



        10.11 
        PROCEDURE FOR INDEMNIFICATION--THIRD PARTY CLAIMS.



        (a) 
        Promptly after receipt
        by an Indemnified Party under Section 10.2, 10.5, or (to the extent provided in
        Section 10.4) Section 10.4.3 of notice of the commencement of any Proceeding
        against it, such Indemnified Party will, if a claim is to be made against an
        Indemnifying Party under such Section, give notice to the Indemnifying Party of
        the commencement of such claim, but the failure to notify the Indemnifying Party
        will not relieve the Indemnifying Party of any liability that it may have to any
        Indemnified Party, except to the extent that the Indemnifying Party demonstrates
        that the defense of such action is prejudiced by the Indemnifying Party’s
        failure to give such notice. 



        (b) 
        If any Proceeding
        referred to in Section 10.10(a) is brought against an Indemnified Party and it
        gives notice to the Indemnifying Party of the commencement of such Proceeding,
        the Indemnifying Party will, unless the claim involves Taxes, be entitled to
        participate in such Proceeding and, to the extent that it wishes (unless (i) the
        Indemnifying Party is also a party to such Proceeding and the Indemnified Party
        determines in good faith that joint representation would be inappropriate, or
        (ii) the Indemnifying Party fails to provide reasonable assurance to the
        Indemnified Party of its financial capacity to defend such Proceeding and
        provide indemnification with respect to such Proceeding), to assume the defense
        of such Proceeding with counsel satisfactory to the Indemnified Party and, after
        notice from the Indemnifying Party to the Indemnified Party of its election to
        assume the defense of such Proceeding, the Indemnifying Party will not, as long
        as it diligently conducts such defense, be liable to the Indemnified Party under
        this Article 10 for any fees of other counsel or any other expenses with respect
        to the defense of such Proceeding, in each case subsequently incurred by the
        Indemnified Party in connection with the defense of such Proceeding, other than
        reasonable costs of investigation. If the Indemnifying Party assumes the defense
        of a Proceeding, (A) it will be conclusively established for purposes of this
        Agreement that the claims made in that Proceeding are within the scope of and
        subject to indemnification; (B) no compromise or settlement of such claims may
        be effected by the Indemnifying Party without the Indemnified Party’s
        consent unless (Y) there is no finding or admission of any violation of Legal
        Requirements or any violation of the rights of any Person and no effect on any
        other claims that may be made against the Indemnified Party, and (Z) the sole
        relief provided is monetary damages that are paid in full by the Indemnifying
        Party; and (C) the Indemnified Party will have no liability with respect to any
        compromise or settlement of such claims effected without its consent. If notice
        is given to an Indemnifying Party of the commencement of any Proceeding and the
        Indemnifying Party does not, within ten Business Days after the Indemnified
        Party’s 




60





        notice is given, give notice to the Indemnified Party of its
        election to assume the defense of such Proceeding, the Indemnifying Party will
        be bound by any determination made in such Proceeding or any compromise or
        settlement effected by the Indemnified Party. 



        (c) 
        Notwithstanding the
        foregoing, if an Indemnified Party determines in good faith that there is a
        reasonable probability that a Proceeding may adversely affect it or its
        affiliates other than as a result of monetary damages for which it would be
        entitled to indemnification under this Agreement, the Indemnified Party may, by
        notice to the Indemnifying Party, assume the exclusive right to defend,
        compromise, or settle such Proceeding, but the Indemnifying Party will not be
        bound by any determination of a Proceeding so defended or any compromise or
        settlement effected without its consent (which may not be unreasonably
        withheld). 



        10.12 
        PROCEDURE FOR
        INDEMNIFICATION--OTHER CLAIMS. A claim for indemnification under
        Sections 10.2, 10.3, 10.4, 10.5 and/or 10.7 (as applicable) for any matter not
        involving a third-party claim may be asserted by notice to the party from whom
        indemnification is sought which notice shall set forth in reasonable detail the
        basis for such claim to the extent their known by such party. 



        10.13 
        EXCLUSIVITY. The parties agree that, except in the case of fraud,
        their sole and exclusive remedy for, under or in connection with this Agreement,
        including any violations or any breach of this Agreement, is a claim under and
        in accordance with the provisions of this Article 10. 


The Guarantor independently
guarantees in favour of the Buyer timely and proper compliance by the Seller
with all its obligations under this Agreement and accepts joint and several
liability with the Seller under this Agreement without the Buyer first having to
seek recourse against the Seller. 



10.15 DISPUTE RESOLUTION.



        (a) 
                Negotiated Resolution. - If any dispute arises (i) out of or relating to,
        this Agreement or any alleged Breach thereof, (ii) with respect to any of the
        transactions or events contemplated hereby or (iii) with respect to any
        Person’s right to indemnification (“Dispute”), the party desiring
        to resolve such Dispute shall deliver a written notice describing such Dispute
        with reasonable specificity to the other parties (“Dispute Notice”).
        If any party delivers a Dispute Notice pursuant to this Section 9.14, the Chief
        Executive Officers of the parties or their designees involved in the Dispute
        shall meet at least twice within the 30 day period commencing with the date of
        the Dispute Notice and in good faith shall attempt to resolve such Dispute,
        including any rejected indemnification claim. 



        (b) 
        Mediation. - If any Dispute is not resolved or settled by the
        parties as a result of negotiation pursuant to Section 9.15(a) above, the
        parties shall submit the Dispute to non-binding mediation in accordance with
        Attachment P to the Shareholders Agreement. 




61





        (c) 
        Arbitration. - If the Dispute is not resolved by mediation pursuant
        to Section 9.15(b) above, the Dispute shall be settled by arbitration conducted in
        accordance with Attachment P to the Shareholders Agreement.



        (d) 
        Equitable Relief. - The provisions of this Section 9.15 shall
        not preclude Buyer from seeking an injunction or other equitable relief to enforce the
        provisions of Article 9 of the Shareholders Agreement.



11. GENERAL PROVISIONS



11.1 EXPENSES.



        (a) 
        Except as otherwise
        expressly provided in this Agreement, each party to this Agreement will bear its
        respective expenses incurred in connection with the preparation, execution and
        performance of this Agreement and the Contemplated Transactions, including all
        fees and expenses of agents, representatives, counsel, accountants and
        investment bankers. 



        (b) 
        Buyer and Seller will each pay one half of the fees in connection with
        any required competition filing.



        (c) 
        Buyer and Seller will each pay one half of the Notary fees;



        (d) 
        Seller shall pay all costs of reorganizing the Business into the Acquired
        Companies.



        (e) 
        In the event of
        termination of this Agreement, the obligation of each party to pay its own
        expenses will be subject to any rights of such party arising from a breach of
        this Agreement by another party. In addition, Seller shall reimburse Buyer for
        one-half of Buyer’s Search Expenses. 



11.2  PUBLIC ANNOUNCEMENTS.



        (a) 
        Seller and Buyer agree
        that, promptly after the execution and delivery of this Agreement or at such
        times as otherwise agreed upon by the parties, they shall each issue a press
        release substantially in the form for Seller and Buyer, respectively, that are
        provided for in the Shareholders Agreement. Unless required by Legal
        Requirements, any other public announcement or similar publicity with respect to
        this Agreement or the Contemplated Transactions will be issued prior to the
        Closing, if at all, at such time and in such manner as Buyer and Seller may
        mutually determine. Prior to the Closing, Buyer and Seller will consult with
        each other concerning the means by which the Acquired Companies’ employees,
        customers and suppliers and others having dealings with the Acquired Companies
        will be informed of the Contemplated Transactions, and Buyer will have the right
        to be present for any such communication. 



        (b) 
        With respect to public
        communications on the Closing Date or otherwise with respect to the Closing,
        Seller and Buyer shall consult in good faith regarding appropriate press
        releases and, unless otherwise required by Legal Requirements, the form and
        content of, any press release, public announcement or similar publicity relating
        to the Closing, the Company and the parties will be mutually determined. 





62





        11.3 
        CONFIDENTIALITY.



        (a) 
        Between the date of
        this Agreement and the Closing Date, Buyer and Seller will maintain in
        confidence, and will cause the directors, officers, employees, agents, and
        advisors of Buyer and the Acquired Companies to maintain in confidence, and not
        use to the detriment of another party or an Acquired Company any written, oral
        or other information obtained in confidence from another party or an Acquired
        Company in connection with this Agreement or the Contemplated Transactions,
        unless (i) such information is already known to such party or to others not
        bound by a duty of confidentiality or such information becomes publicly
        available through no fault of such party, (ii) the use of such information is
        necessary or appropriate in making any filing or obtaining any consent or
        approval required for the consummation of the Contemplated Transactions, or
        (iii) the furnishing or use of such information is required by or necessary or
        appropriate in connection with legal proceedings. 



        (b) 
        If the Contemplated
        Transactions are not consummated, each party will return or destroy as much of
        such written information as the other party may reasonably request. Whether or
        not the Closing takes place, Seller waives and will, upon Buyer’s request,
        cause the Acquired Companies to waive, any cause of action, right or claim
        arising out of the access of Buyer or its representatives to any trade secrets
        or other confidential information of the Acquired Companies except for the
        intentional competitive misuse by Buyer of such trade secrets or confidential
        information. 



        (c) 
        Nothing herein
        contained is intended to void, replace in whole or in part or limit the
        application of any Confidentiality Agreements previously entered into by and
        between the parties or their Related Persons which shall remain in full force
        and effect in accordance with the terms thereof. 



        11.4 NOTICES. All notices, consents, waivers, and other communications
        under this Agreement must be in writing and will be deemed to have been duly
        given when (a) delivered by hand (with written confirmation of receipt), (b)
        sent by telecopier (with written confirmation of receipt), provided that a copy
        is mailed by registered mail, return receipt requested, or (c) when received by
        the addressee, if sent by a nationally recognized overnight delivery service
        (receipt requested), in each case to the appropriate addresses and telecopier
        numbers set forth below (or to such other addresses and telecopier numbers as a
        party may designate by notice to the other parties): 


	
                Seller or Guarantor:	





		
                LGL Holland B.V.


                c/o Lennox International, Inc.

                2140 Lake Park Bld

                Richardson, Texas  75080-2254

                Attention: General Counsel

                Facsimile No.: 972-497-5268 






63




	
                        Buyer:	





		
                                    Outokumpu Copper Products Oy

                                    c/o Outokumpu Oyj

                                    Riihitontuntie 7D

                                    P.O. Box 280

                                    Espoo, Finland   02201

                                    Attention: Corporate General Counsel

                                    Facsimile No.: 011-358-9-421-2428





	
                        with a copy to:





		
                                    Hodgson Russ LLP

                                    One M&T Plaza, Suite 2000

                                    Buffalo, New York  14203

                                    Attention:  Robert B. Fleming, Jr., Esq.

                                    Facsimile No.:  716-849-0349






        11.5 
        JURISDICTION;SERVICE OF PROCESS. Except as otherwise set
        forth in Section
        10.13 or elsewhere in this Agreement, any action or proceeding seeking to
        enforce any provision of, or based on any right arising out of, this Agreement
        may be brought in the courts of the State of Florida, Dade County , or, if it
        has or can acquire jurisdiction, in the United States District Court for the
        Southern District of Florida. Each of the parties consents to the jurisdiction
        of such courts (and of the appropriate appellate courts) in any such action or
        proceeding and waives any objection to venue laid therein. Process in any action
        or proceeding referred to in the preceding sentence may be served on any party
        anywhere in the world. 



        11.6 
        FURTHER ASSURANCES; INFORMATION.



        (a) 
        The parties agree
        (i) to furnish upon request to each other such further information,
        (ii) to execute and deliver to each other such other documents, and
        (iii) to do such other acts and things, all as the other party may
        reasonably request for the purpose of carrying out the intent of this Agreement
        and the documents referred to in this Agreement. 



        (b) 
        From and after the
        Closing, Seller and its Representatives will be allowed, upon reasonable
        request, to inspect and copy at their expense the business records and accounts
        of the Company. Buyer agrees with Seller that the Company shall not destroy or
        abandon any business records or accounts relating to the Business except upon
        thirty (30) days’ advance written notice to Seller for a period of five (5)
        years thereafter. If Seller requests the surrender of such records or accounts,
        then the Company shall surrender, at Seller’s expense, such records or
        accounts so required rather than proceeding with such destruction. 







64





        (c) 
        From and after the
        Closing, Buyer, the Acquired Companies and their Representatives will be allowed
        upon reasonable request to inspect and copy at their expense the records of
        Seller and its Related Persons relating to the Acquired Companies and the
        Business through the Closing Date that are in the possession or control of
        Seller or any of its Related Persons and are not transferred to the Acquired
        Companies, including all financial records and tax returns relating to the
        Business. Seller agrees not to destroy or abandon any such records for a period
        of five (5) years following the Closing.(d) If at any time within three (3)
        years after the date of this Agreement, Buyer or any of its Related Persons
        proposes to register under the Securities Act of 1933, as amended, any
        securities in connection with any registered offering thereof and in connection
        therewith the Securities and Exchange Commission (“SEC”) makes any
        comments or requests any information with respect to accounting information
        presented in the registration statement pertaining to any period prior to the
        Closing Date, then Seller will cooperate fully in responding promptly to such
        comments or questions, and will use its reasonable best efforts to cause
        Seller’s Accountants to respond to comments on the relevant financial
        statements or to provide such information as the SEC requests in order to cause
        the SEC to declare effective such registration statement, at the expense of
        Buyer or its designated Related Persons, as the case may be. In addition, Seller
        will provide to any underwriter relating to financial information pertaining to
        any period prior to the Closing Date as required by Legal Requirements or
        applicable regulations or guidance of the accounting profession. 



        11.8 
        PREVAILENCE. The Parties expressly agree that in case of
        discrepancy this Agreement shall prevail on all agreements entered into to give
        effect to the restructuring and transfer of the Business into the Acquired
        Companies (hereinafter referred to as the “Implementing
        Agreement(s)”),in particular the French law contribution agreement entered
        into between LGL France and Heatcraft France SAS dated as of May 24, 2002, (for
        the purposes of this Article, the “Contribution Agreement”); as a
        consequence, for the avoidance of doubt, any discrepancy between this Agreement
        and the Contribution Agreement shall be settled by exclusive reference and
        construction of this Agreement. Furthermore, the Seller hereby commits to cause
        its Subsidiaries, in particular LGL France, to waive any claims it may have from
        time to time against Heatcraft France SAS under the Contribution Agreement, or
        should such claims be held by a third party, to hold Heatcraft France SAS
        harmless on any amounts it could incur thereunder, further to the provisions of
        the Contribution Agreement, these claims being exclusively dealt with under this
        Agreement. In the event provision(s) of the Agreement is (are) unenforceable,
        the Parties shall meet in good faith and do their best efforts to find
        alternatives which comply with the relevant laws and match as closely as
        possible the economic and financial intention reflected in this Agreement. 



        11.9 
        WAIVER. The rights and remedies of the parties to this Agreement
        are cumulative and not alternative. Neither the failure nor any delay by any
        party in exercising any right, power or privilege under this Agreement or the
        documents referred to in this Agreement will operate as a waiver of such right,
        power or privilege, and no single or partial exercise of any such right, power
        or privilege will preclude any other or further exercise of such right, power or
        privilege or the exercise of any other right, power or privilege. To the maximum
        extent permitted by applicable law, (a) no claim or right 





65





        arising out of this Agreement or the documents referred to in this Agreement
        can be discharged
        by one party, in whole or in part, by a waiver or renunciation of the claim or
        right unless in writing signed by the other party, (b) no waiver that may
        be given by a party will be applicable except in the specific instance for which
        it is given, and (c) no notice to or demand on one party will be deemed to
        be a waiver of any obligation of such party or of the right of the party giving
        such notice or demand to take further action without notice or demand as
        provided in this Agreement or the documents referred to in this Agreement. 



        11.10 
        ENTIRE AGREEMENT AND MODIFICATION. This Agreement supersedes all prior
        agreements between the parties with respect to its subject matter (including
        without limitation the Memorandum of Agreement between Outokumpu Oyj and Seller
        dated on or about April 9, 2002) and constitutes (along with the Schedules and
        documents referred to in this Agreement) a complete and exclusive statement of
        the terms of the agreement between the parties with respect to its subject
        matter. This Agreement may not be amended except by a written agreement executed
        by the party to be charged with the amendment. 



        11.11 
        ASSIGNMENTS,SUCCESSORS AND NO THIRD-PARTY RIGHTS. Neither
        party may assign any of its rights under this Agreement without the prior
        consent of the other parties, except that Buyer or Seller may assign any
        of its rights under this Agreement to any Subsidiary of Buyer or Seller.
        Subject to the preceding sentence, this Agreement will apply to, be binding
        in all respects upon and inure to the benefit of the successors and permitted
        assigns of the parties.  Nothing expressed or referred to in this Agreement
        will be construed to give any Person other than the parties to this Agreement
        any legal or equitable right remedy, or claim under or with respect to this
        Agreement or any provision of this Agreement. This Agreement and all of its
        provisions and conditions are for the sole and exclusive benefit of the
        parties to this Agreement and their successors and assigns. 



        11.12 
        SEVERABILITY. If any provision of this Agreement is held invalid
        or unenforceable by any court of competent jurisdiction, the other provisions of
        this Agreement will remain in full force and effect. Any provision of this
        Agreement held invalid or unenforceable only in part or degree will remain in
        full force and effect to the extent not held invalid or unenforceable. 



        11.13 
        SECTION HEADINGS, CONSTRUCTION. The headings of Sections in this
        Agreement are provided for convenience only and will not affect its construction
        or interpretation. All references to “Section” or “Sections”
        refer to the corresponding Section or Sections of this Agreement. All references
        to “Schedule” or “Schedules” refer to the corresponding
        Schedule or Schedules attached to and made a part of this Agreement. All words
        used in this Agreement will be construed to be of such gender or number as the
        circumstances require. Unless otherwise expressly provided, the word
        “including” does not limit the preceding words or terms. 



        11.14 
        TIME OF ESSENCE.  With regard to all dates and time periods set
        forth or referred to in this Agreement, time is of the essence.



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        11.15 
        GOVERNING LAW.  This Agreement is governed by the laws of
        the State of  New York without regard to conflicts of laws principles.






        11.16 
        COUNTERPARTS. This Agreement may be executed in two or more
        counterparts, each of which will be deemed to be an original copy of this
        Agreement and all of which, when taken together, will be deemed to constitute
        one and the same agreement. 


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


		
                Seller:

                LGL HOLLAND B.V.




                By: /s/ Carl E. Edwards, Jr. 

                Name: Carl E. Edwards, Jr.

                Title:   Director





		
                Guarantor:

                LGL EUROPE HOLDING CO.



                By: /s/ Carl E. Edwards, Jr. 

                Name: Carl E. Edwards, Jr.

                Title:   Secretary





		
                Buyer:

                OUTOKUMPU COPPER PRODUCTS OY




                By: /s/ Kalevi Nikkilä  

                Name:

                Title: