exv10w1






Exhibit 10.1




ASSET PURCHASE AGREEMENT




BY AND BETWEEN




VOUGHT AIRCRAFT INDUSTRIES, INC.




AND




BCACSC, INC.




Dated as of July 6, 2009




 









 





TABLE OF CONTENTS




	 	 	 	 	 
	ARTICLE I DEFINITIONS
	 	 	1	 
	Section 1.1 Definitions
	 	 	1	 
	Section 1.2 Construction
	 	 	19	 
	 
	 	 	 	 
	ARTICLE II PURCHASE AND SALE OF ASSETS AND ASSUMPTION OF LIABILITIES
	 	 	20	 
	Section 2.1 Purchase of Assets and Assumption of Certain Liabilities
	 	 	20	 
	Section 2.2 Purchased and Excluded Assets
	 	 	20	 
	Section 2.3 Assumed and Excluded Liabilities
	 	 	24	 
	 
	 	 	 	 
	ARTICLE III AGGREGATE CONSIDERATION AND CLOSING
	 	 	26	 
	Section 3.1 Closing
	 	 	26	 
	Section 3.2 Aggregate Consideration
	 	 	26	 
	Section 3.3 Estimated Aggregate Consideration Adjustment
	 	 	26	 
	Section 3.4 Aggregate Consideration Adjustment
	 	 	27	 
	Section 3.5 Allocation of Aggregate Consideration
	 	 	28	 
	 
	 	 	 	 
	ARTICLE IV REPRESENTATIONS AND WARRANTIES OF SELLER
	 	 	29	 
	Section 4.1 Organization and Qualification
	 	 	29	 
	Section 4.2 Authorization; Enforceability
	 	 	30	 
	Section 4.3 No Conflicts
	 	 	30	 
	Section 4.4 Financial Information
	 	 	31	 
	Section 4.5 Absence of Certain Developments
	 	 	31	 
	Section 4.6 Absence of Undisclosed Liabilities
	 	 	32	 
	Section 4.7 Title; Sufficiency and Condition of Assets
	 	 	32	 
	Section 4.8 Inventory
	 	 	33	 
	Section 4.9 Real Property
	 	 	33	 
	Section 4.10 Intellectual Property
	 	 	34	 
	Section 4.11 Contracts
	 	 	36	 
	Section 4.12 Litigation
	 	 	38	 
	Section 4.13 Permits; Compliance with Laws
	 	 	39	 
	Section 4.14 Environmental, Health and Safety Laws
	 	 	40	 
	Section 4.15 Tax Matters
	 	 	42	 
	Section 4.16 Employee Benefit Plans; Employment Matters
	 	 	43	 
	Section 4.17 Suppliers
	 	 	45	 
	Section 4.18 Insurance
	 	 	45	 
	Section 4.19 Certain Transactions
	 	 	46	 
	Section 4.20 Broker’s Fees
	 	 	46	 
	Section 4.21 Security Clearance
	 	 	46	 
	Section 4.22 Site Development and Incentive Agreement; FILOT Agreement
	 	 	46	 
	 
	 	 	 	 
	ARTICLE V REPRESENTATIONS AND WARRANTIES OF BUYER
	 	 	47	 
	Section 5.1 Organization and Qualification
	 	 	47	 
	Section 5.2 Authority; Enforceability
	 	 	47	 
	Section 5.3 No Conflicts
	 	 	47	 






i









 






	 	 	 	 	 
	Section 5.4 Broker’s Fees
	 	 	48	 
	Section 5.5 Litigation
	 	 	48	 
	 
	 	 	 	 
	ARTICLE VI COVENANTS
	 	 	48	 
	Section 6.1 Appropriate Actions; Further Assurances
	 	 	48	 
	Section 6.2 Conduct of Business by Seller Until Closing
	 	 	49	 
	Section 6.3 Consents and Governmental Authorizations
	 	 	51	 
	Section 6.4 Access and Information
	 	 	53	 
	Section 6.5 Exclusivity
	 	 	54	 
	Section 6.6 Public Announcements
	 	 	54	 
	Section 6.7 Transaction Expenses
	 	 	54	 
	Section 6.8 Notices of Certain Matters
	 	 	55	 
	Section 6.9 Confidentiality
	 	 	55	 
	Section 6.10 Non-Solicitation
	 	 	56	 
	Section 6.11 Intracompany Work Orders
	 	 	57	 
	Section 6.12 Purchased Intellectual Property
	 	 	57	 
	Section 6.13 Insurance
	 	 	58	 
	Section 6.14 Litigation Support
	 	 	58	 
	Section 6.15 Transfer of Governmental Authorizations
	 	 	59	 
	Section 6.16 787 Supply Agreement
	 	 	59	 
	Section 6.17 Delivery of Financial Information
	 	 	59	 
	Section 6.18 Cash Management
	 	 	59	 
	Section 6.19 Title Insurance
	 	 	60	 
	Section 6.20 Letters of Credit; Surety Bond
	 	 	60	 
	Section 6.21 Lender Waiver
	 	 	60	 
	 
	 	 	 	 
	ARTICLE VII TAX MATTERS
	 	 	61	 
	Section 7.1 Liability for Taxes
	 	 	61	 
	Section 7.2 Tax Return Filing
	 	 	62	 
	Section 7.3 Tax Contests; Audit Responsibilities
	 	 	62	 
	Section 7.4 Cooperation
	 	 	63	 
	Section 7.5 Transfer Taxes
	 	 	64	 
	 
	 	 	 	 
	ARTICLE VIII EMPLOYEE MATTERS
	 	 	64	 
	Section 8.1 Employment
	 	 	64	 
	Section 8.2 Non-Union Employees
	 	 	65	 
	Section 8.3 Union Employees
	 	 	66	 
	Section 8.4 Workers’ Compensation Claims
	 	 	67	 
	Section 8.5 WARN Act Notification
	 	 	67	 
	Section 8.6 Employee Benefits
	 	 	68	 
	Section 8.7 No Right to Employment
	 	 	68	 
	Section 8.8 Code Section 409A
	 	 	68	 
	 
	 	 	 	 
	ARTICLE IX CONDITIONS PRECEDENT
	 	 	68	 
	Section 9.1 Conditions to Obligations of Buyer
	 	 	68	 
	Section 9.2 Conditions to Obligations of Seller
	 	 	71	 






ii









 






	 	 	 	 	 
	ARTICLE X TERMINATION
	 	 	73	 
	Section 10.1 Termination
	 	 	73	 
	Section 10.2 Effect of Termination
	 	 	74	 
	 
	 	 	 	 
	ARTICLE XI INDEMNIFICATION
	 	 	74	 
	Section 11.1 Survival
	 	 	74	 
	Section 11.2 Indemnification by Seller
	 	 	75	 
	Section 11.3 Indemnification by Buyer
	 	 	80	 
	Section 11.4 Third Party Claims
	 	 	80	 
	Section 11.5 Limitations on Indemnification Liability
	 	 	82	 
	Section 11.6 Treatment of Indemnification Payments
	 	 	83	 
	Section 11.7 Exclusive Remedy
	 	 	83	 
	 
	 	 	 	 
	ARTICLE XII GENERAL PROVISIONS
	 	 	84	 
	Section 12.1 Notices
	 	 	84	 
	Section 12.2 Severability; Specific Enforcement
	 	 	85	 
	Section 12.3 Amendments
	 	 	85	 
	Section 12.4 Assignment; Beneficiaries
	 	 	86	 
	Section 12.5 Counterparts; Facsimiles
	 	 	86	 
	Section 12.6 Descriptive Headings
	 	 	86	 
	Section 12.7 Governing Law; Forum Selection
	 	 	86	 
	Section 12.8 WAIVER OF JURY TRIAL
	 	 	86	 
	Section 12.9 Entire Agreement
	 	 	87	 
	Section 12.10 Waivers
	 	 	87	 
	Section 12.11 NO ADDITIONAL REPRESENTATION OR WARRANTIES
	 	 	87	 
	Section 12.12 Disclosure Schedules
	 	 	87	 
	Section 12.13 No Recourse
	 	 	88	 






iii









 





EXHIBITS




	 	 	 
	Exhibit A

	 	Form of Termination and Mutual Release Agreement
	Exhibit B

	 	Form of Bill of Sale, Assignment and Assumption Agreement
	Exhibit C

	 	Form of Intellectual Property Assignment
	Exhibit D

	 	Form of Intellectual Property License Agreement
	Exhibit E

	 	Form of Engineering Services Agreement
	Exhibit F

	 	Form of Transition Services Agreement
	Exhibit G

	 	Form of SOW Supply Agreement
	Exhibit H

	 	Form of Facilities Bill of Sale, Assignment and Assumption Agreement
	Exhibit I

	 	Form of North Charleston Sublease Assumption
	Exhibit J

	 	Form of GA Sublease Assumption
	Exhibit K

	 	Form of SOW Side Letter
	Exhibit L

	 	Form of 747 Amendment
	Exhibit M

	 	Form of 767 Amendment
	Exhibit N

	 	Form of 777 Amendment
	Exhibit O

	 	Form of SOW Warranty Agreement
	Exhibit P

	 	Form of SOW Administrative Agreement
	Appendix A

	 	Adjusted Net Investment Worksheet






iv









 






DISCLOSURE SCHEDULES




	 	 	 
	Schedule 1.1A

	 	Background Inventions of Seller
	Schedule 1.1B

	 	Background Proprietary Information of Seller
	Schedule 1.1C

	 	Outstanding Encumbrances
	Schedule 1.1D

	 	Permitted Encumbrances
	Schedule 1.1E

	 	Retained Employees
	Schedule 2.2(a)(i)

	 	Purchased Contracts
	Schedule 2.2(a)(ii)

	 	Tangible Personal Property
	Schedule 2.2(b)(viii)

	 	Governmental Authorizations
	Schedule 2.2(b)(xvii)

	 	Certain Real Property
	Schedule 2.2(b)(xix)

	 	Excluded Tangible Property
	Schedule 2.3(a)(ii)

	 	Assumed Employee Liabilities
	Schedule 4.3(a)

	 	Required Consents
	Schedule 4.3(b)

	 	No Conflicts
	Schedule 4.4

	 	Financial Information
	Schedule 4.5

	 	Absence of Certain Developments
	Schedule 4.6

	 	Undisclosed Liabilities
	Schedule 4.7

	 	Title, Sufficiency and Condition of Assets
	Schedule 4.8

	 	Inventory
	Schedule 4.10(a)

	 	Intellectual Property
	Schedule 4.10(b)

	 	Inbound License Agreements
	Schedule 4.10(c)

	 	Infringement
	Schedule 4.10(d)

	 	Confidentiality and Assignment Agreements
	Schedule 4.10(e)

	 	Software
	Schedule 4.10(f)

	 	Information Technology Systems
	Schedule 4.11(a)(i)

	 	Material Contracts
	Schedule 4.11(a)(ii)

	 	Material Contracts
	Schedule 4.11(a)(iii)

	 	Material Contracts
	Schedule 4.11(a)(iv)

	 	Material Contracts
	Schedule 4.11(a)(v)

	 	Material Contracts
	Schedule 4.11(a)(vi)

	 	Material Contracts
	Schedule 4.11(a)(vii)

	 	Material Contracts
	Schedule 4.11(a)(viii)

	 	Material Contracts
	Schedule 4.11(a)(ix)

	 	Material Contracts
	Schedule 4.11(a)(x)

	 	Material Contracts
	Schedule 4.11(a)(xi)

	 	Material Contracts
	Schedule 4.11(a)(xii)

	 	Material Contracts
	Schedule 4.11(b)

	 	Material Contracts
	Schedule 4.11(c)

	 	Material Contracts
	Schedule 4.11(e)

	 	Material Contracts
	Schedule 4.12

	 	Litigation
	Schedule 4.13

	 	Material Governmental Authorizations
On-Site Waste Disposal Activities and Operations; On-Site
Sale,

	Schedule 4.14(a)

	 	 Treatment, Processing, Recycling or Disposal of
Hazardous Waste
	Schedule 4.14(b)

	 	Underground Storage Tanks, Sumps or Wells






v









 






	 	 	 
	Schedule 4.14(c)

	 	Compliance with Environmental Laws
	Schedule 4.14(d)

	 	Environmental Permits and Environmental Disclosure Reports
	Schedule 4.14(e)

	 	Release or Threatened Release of Hazardous Material
	Schedule 4.14(f)

	 	Hazardous Material Emanating from Property or Purchased Assets
	Schedule 4.14(g)

	 	Environmental Claims
	Schedule 4.14(h)

	 	Environmental Restrictions on the Use of Property
	Schedule 4.15

	 	Tax Matters
	Schedule 4.15(g)

	 	Partnership Interests
	Schedule 4.16(a)

	 	Employee Benefit Plans
	Schedule 4.16(c)

	 	Retiree Medical or Other Welfare Benefits
	Schedule 4.16(d)

	 	Pension and Multiemployer Plans
	Schedule 4.16(f)

	 	Employees on Leave
	Schedule 4.16(h)

	 	Employee Controversies
	Schedule 4.16(i)

	 	Collective Bargaining Agreements
	Schedule 4.16(m)

	 	Participating Employees
	Schedule 4.17

	 	Suppliers
	Schedule 4.18

	 	Insurance
	Schedule 4.19

	 	Affiliate Transactions
	Schedule 4.20

	 	Broker’s Fees
	Schedule 4.21

	 	Security Clearances
	Schedule 5.3

	 	No Conflicts
	Schedule 5.4

	 	Brokers’ Fees
	Schedule 6.2(a)

	 	Conduct of Business
	Schedule 6.2(b)(i)

	 	Exceptions to Conduct of Business
	Schedule 6.2(b)(ii)

	 	Exceptions to Conduct of Business
	Schedule 6.2(b)(iii)

	 	Exceptions to Conduct of Business
	Schedule 6.2(b)(iv)

	 	Exceptions to Conduct of Business
	Schedule 6.2(b)(v)

	 	Exceptions to Conduct of Business
	Schedule 6.2(b)(vi)

	 	Exceptions to Conduct of Business
	Schedule 6.2(b)(vii)

	 	Exceptions to Conduct of Business
	Schedule 6.2(b)(viii)

	 	Exceptions to Conduct of Business
	Schedule 6.2(b)(ix)

	 	Exceptions to Conduct of Business
	Schedule 6.2(b)(x)

	 	Exceptions to Conduct of Business
	Schedule 6.2(b)(xi)

	 	Exceptions to Conduct of Business
	Schedule 6.2(b)(xii)

	 	Exceptions to Conduct of Business
	Schedule 6.10(c)(i)

	 	Seller Engineering Employees
	Schedule 6.10(c)(ii)

	 	Excluded Engineering Employees
	Schedule 6.20

	 	Guarantees
	Schedule 7.5

	 	Transfer Taxes
	Schedule 8.1(a)(i)

	 	Employees of the Business
	Schedule 8.1(a)(ii)

	 	Seller Employees Who Are No Longer Employees
	Schedule 8.4

	 	Open Workers’ Compensation Claims
	Schedule 11.4(e)

	 	Settlements







vi









 








ASSET PURCHASE AGREEMENT




     This ASSET PURCHASE AGREEMENT, dated as of July 6, 2009 (this “Agreement”), is entered
into by and between Vought Aircraft Industries, Inc., a Delaware corporation (“Seller”),
and BCACSC, Inc., a Delaware corporation (“Buyer”).



     WHEREAS, Seller is engaged in the business (the “Business”) of designing (including
initial design, design related to build, certification, and testing), manufacturing (including
procurement, fabrication, and assembly (including structures assembly, systems assembly, and
integration)), and supporting aft fuselage sections 47 and 48 and the aft 48 (in each case,
including spare parts) for the 787 program (the “787 Program”) of The Boeing Company, a
Delaware corporation and the parent corporation of Buyer (“Boeing”), pursuant to the
General Terms Agreement, BCA-65572-0026, and Special Business Provisions, MS-65572-0030, between
Seller and Boeing, dated as of July 7, 2005, as amended by Amendment No. 1 dated as of November 15,
2006, as further amended by Amendment No. 2 dated as of November 30, 2006, as further amended by
Amendment No. 3 dated as of June 24, 2009, as further amended by Amendment No. 4 dated as of
November 13, 2007, as further amended by Amendment No. 5 dated as of July 1, 2008, as further
amended by Amendment No. 8 dated as of April 17, 2009, and as otherwise further amended from time
to time in accordance with its terms (the “787 Supply Agreement”); and



     WHEREAS, this Agreement contemplates a transaction in which (i)  Buyer will acquire all of the
business, assets and operations used in the Business (other than the Excluded Assets, as specified
herein), and will assume the liabilities of the Business (other than the Excluded Liabilities, as
specified herein), all on the terms and subject to the conditions set forth in this Agreement, and
(ii) pursuant to and on the terms set forth in the Termination and Mutual Release Agreement, each
of Boeing and Seller, on behalf of themselves and each of their respective Subsidiaries, will
terminate the 787 Supply Agreement and release Claims and resolve any and all rights and
obligations owed to each other related to the 787 Supply Agreement as described therein.



     NOW, THEREFORE, in consideration of the foregoing and the mutual representations, warranties,
covenants and agreements contained herein, and for other good and valuable consideration, the
value, receipt and sufficiency of which are acknowledged, the Parties hereby agree as follows:



ARTICLE I




DEFINITIONS




     Section 1.1 Definitions. For purposes of this Agreement, the following terms have the
meanings set forth below:



     “401(k) Plan” is defined in Section 4.16(b) of this Agreement.



     “747 Amendment” is defined in Section 9.1(e)(xiii) of this Agreement.



     “767 Amendment” is defined in Section 9.1(e)(xiv) of this Agreement.



 









 





     “777 Amendment” is defined in Section 9.1(e)(xv) of this Agreement.



     “787 Design Build Guide” is defined in the definition of Required by Boeing in
Section 1.1 of this Agreement.



     “787 Program” is defined in the Recitals to this Agreement.



     “787 Supply Agreement” is defined in the Recitals to this Agreement.



     “Absent Employees” is defined in Section 8.2(b) of this Agreement.



     “Accounts Receivable” is defined in Section 2.2(a)(v) of this Agreement.



     “Acquisition Proposal” is defined in Section 6.5 of this Agreement.



     “Additional Restricted Employees” means all Persons employed by the Business after the
Closing Date (other than any Transferred Employees).



     “Adjusted Net Investment Amount” means, as of any date, (i)(A) the aggregate amount
(without duplication) of all investments made and expenses incurred or accrued by Seller and its
Subsidiaries in connection with the 787 Program at any time as of such date, minus (B) the
sum of, without duplication, (u)  the aggregate amount of payments and advances made on or prior to
such date by Buyer or its Affiliates to Seller pursuant to the 787 Supply Agreement, (v) grants
made to Seller by the State of South Carolina under the Site Development and Incentive Agreement on
or prior to such date, (w) the accounts payable of Seller in respect of amounts referred to above
in clause (i)(A) that constitute Assumed Liabilities as of such date, (x) to the extent included in
the amount in clause (i)(A) above, the Milledgeville direct labor and Milledgeville capex line
items on Appendix A, (y) to the extent included in the amount in clause (i)(A) above, the
Dallas IT equipment line item on Appendix A, and (z) to the extent included in the amount
in clause (i)(A) above, the corporate G&A line item on Appendix A through March 29, 2009,
in the case of each of the foregoing clauses, determined and calculated in accordance with the
calculation of the Adjusted Net Investment Amount estimated as of March 29, 2009, set forth on
Appendix A, and determined in accordance with the Agreed Methodology, plus (ii) fifty
percent (50%) of the amount of the G&A Costs properly allocable to the Business; provided, that in
no event shall the amount determined pursuant to the foregoing clause (ii) exceed the G&A Cost Cap.



     “Affiliate” means with respect to any Person, any other Person that directly or
indirectly, through one or more intermediaries, Controls, is Controlled by, or is under common
Control with such Person or entity.



     “Aggregate Consideration” is defined in Section 3.2 of this Agreement.



     “Agreed Methodology” means the practices, policies and methodologies set forth on
Annex I to Appendix A (including methodologies, consistently applied, in allocating general
and administrative and other indirect costs) that were used by Seller in determining and
calculating the estimated amount of the Adjusted Net Investment Amount as of March 29, 2009, which
estimate is reflected on Appendix A (it being acknowledged that (i) the purpose of the



2









 




adjustment to the Closing Payment Amount pursuant to Section 3.4 is to ensure an accurate
calculation of the Closing Adjusted Net Investment Amount, consistent with the calculation of the
estimated Adjusted Net Investment Amount as of March 29, 2009, as reflected on Appendix A,
rather than to change or challenge the practices, policies or methodologies set forth on Annex I to
Appendix A, (ii) for purposes of calculating the Closing Adjusted Net Investment Amount,
indirect costs of the 787 Program for the period between March 29, 2009 and the Closing will be
limited to the categories of indirect costs listed in or reflected on Appendix A, which
shall be allocated using the same practices, policies and methodologies set forth on Annex I to
Appendix A, and (iii) for the avoidance of doubt, direct costs, expenses and investments
reflected in the Adjusted Net Investment Amount shall be limited to such costs, expenses and
investments made or incurred by Seller for the 787 Program).




     “Agreement” is defined in the Preamble to this Agreement.



     “Allocation Statement” is defined in Section 3.5(a) of this Agreement.



     “Anti-Bribery Laws” is defined in Section 4.13(c) of this Agreement.



     “Apportioned Tax” means any Tax relating to any Purchased Asset (including any
additional Tax determined subsequent to the Closing Date) that is due or becomes due without
acceleration for any Straddle Period; provided, however, that any Tax that is an
Assumed Liability will not be an Apportioned Tax.



     “Apportioned Taxes Claim” is defined in Section 7.3(c) of this Agreement.



     “Arbitrator” is defined in Section 11.5(b) of this Agreement.



     “Assets” means all assets, properties and rights of every kind (whether tangible or
intangible), including real and personal property.



     “Assumed Liabilities” is defined in Section 2.3(a) of this Agreement.



     “Background Invention(s)” is defined in the 787 Supply Agreement and, with respect to
Seller, includes those inventions listed on Schedule 1.1A.



     “Background Proprietary Information” is defined in the 787 Supply Agreement and, with
respect to Seller, includes that proprietary information listed on Schedule 1.1B.



     “Base Adjusted Net Investment Amount” is Four Hundred Seventy-Six Million Dollars
($476,000,000.00).



     “BCA” is defined in Section 6.10(c) of this Agreement.



     “Bill of Sale, Assignment and Assumption Agreement” is defined in Section
9.1(e)(ii) of this Agreement.



     “BIS” is defined in Section 6.3(c) of this Agreement.



3









 





     “Boeing” is defined in the Recitals to this Agreement.



     “Boeing Guaranty” means that certain Guaranty, executed as of the date hereof, by
Boeing in favor of and for the benefit of Seller.



     “Business” is defined in the Recitals to this Agreement.



     “Business Books and Records” is defined in Section 2.2(a)(xi) of this
Agreement.



     “Business Day” means any day that is not a Saturday, Sunday or any other day on which
banks are required or authorized by Law to be closed in New York City, New York.



     “Buyer” is defined in the Preamble to this Agreement.



     “Buyer Cure Period” is defined in Section 10.1(b)(ii) of this Agreement.



     “Buyer 401(k) Plan” is defined in Section 8.6(b) of this Agreement.



     “Buyer Indemnified Person” is defined in Section 11.2(a) of this Agreement.



     “CERCLA” is defined in the definition of Environmental Laws in Section 1.1 of
this Agreement.



     “Chosen Courts” is defined in Section 12.7 of this Agreement.



     “Claims” means any and all claims (including any cross-claim or counterclaim), causes
of action, suits, charges, complaints, litigation, arbitration, proceeding (including any civil,
criminal, administrative, investigative or appellate proceeding) and disputes, whenever or however
arising.



     “Closing” is defined in Section 3.1 of this Agreement.



     “Closing Adjusted Net Investment Amount” is defined in Section 3.4(a) of this
Agreement.



     “Closing Date” is defined in Section 3.1 of this Agreement.



     “Closing Payment Amount” is defined in Section 3.2 of this Agreement.



     “COBRA” is defined in Section 4.16(c) of this Agreement.



     “Code” means the Internal Revenue Code of 1986, as amended, and all Laws promulgated
pursuant thereto or in connection therewith.



     “Collective Bargaining Agreement” means any collective bargaining agreement or labor
agreement with the Union representing Transferred Employees, including any amendments, supplements,
letters and memoranda of understanding.



     “Confidential Information” is defined in Section 6.9(a) of this Agreement.



4









 





     “Confidentiality and Assignment Agreements” is defined in Section 4.10(d) of
this Agreement.



     “Consent” means any approval, consent, permission, waiver or authorization from any
Person other than a Governmental Entity.



     “Contract” means any contract, agreement, commitment or undertaking (whether written
or oral).



     “Control” (including the terms “Controlled by” and “under common Control
with”) means, as used with respect to any Person, possession of power or authority (directly or
indirectly or as a trustee or executor) to direct or cause the direction of management or policies
of such Person (whether through ownership of voting securities, as trustee or executor, by Contract
or otherwise).



     “Copyrights” means any and all of the following, and all rights arising out of or
associated therewith, in each case, in any jurisdiction in the world: original works of authorship
(whether copyrightable or not); copyrights, including unregistered and common law rights therein;
moral or economic rights of authors; copyright registrations; and applications to register
copyrights.



     “Covered Product” means any product that is the same type of product as a Product that
was designed, manufactured or sold by Seller or a supplier of Seller pursuant to or in
contemplation of the 787 Supply Agreement prior to the Closing (a “Pre-Closing Product”)
including (y) a product that was designed by Seller or a supplier of Seller prior to the Closing
pursuant to or in contemplation of the 787 Supply Agreement and manufactured or sold after the
Closing, and (z) a product manufactured or sold after the Closing that uses a method or process of
design or manufacture that was created prior to the Closing by Seller or a supplier of Seller
pursuant to or in contemplation of the 787 Supply Agreement for the same type of product as a
Pre-Closing Product, in each case regardless of whether such product or type of product had been
manufactured or sold prior to the Closing; provided, however, that (i) any product
designed prior to the Closing will not constitute a Covered Product following any change to the
specifications or design of such product made following the Closing to the extent (A) prior to the
Closing, the manufacture, sale or use of such product did not result in, or would not, if such
product had been manufactured, sold or used at such time, have resulted in, the infringement or
unlawful use of any Intellectual Property right and (B) the manufacture, sale or use of such
product following such change results in the infringement or unlawful use of any Intellectual
Property right and such infringement or unlawful use would not have occurred but for such change,
and (ii) any product manufactured prior to the Closing will not, following any change made
following the Closing to a method or process used in connection with the manufacture of such
product prior to the Closing, constitute a Covered Product to the extent (A) prior to the Closing,
the manufacture, sale or use of such product did not result in, or would not, if such product had
been manufactured, sold or used at such time, have resulted in, the infringement or unlawful use of
any Intellectual Property right and (B) the manufacture, sale or use of such product following such
change results in the infringement or unlawful use of any Intellectual Property right and
such infringement or unlawful use would not have occurred but for such change. For the
purpose of the foregoing, a product is the “same type of product as a Pre-Closing Product” if



5









 




such
product is (i) manufactured, used and sold as, on or in connection with a Program Aircraft and (ii)
such product and any Pre-Closing Product have the same specifications, design, form, fit and
function; provided, however, that such product shall continue to constitute the
“same type of product as a Pre-Closing Product” notwithstanding any post-Closing change to the
specifications, design, form, fit or function or method or process of manufacturing such product
unless (A) prior to the Closing, the manufacture, sale or use of such product did not result in, or
would not, if such product had been manufactured, sold or used at such time, have resulted in, the
infringement or unlawful use of any Intellectual Property right and (B) the manufacture, sale or
use of such product following such change results in the infringement or unlawful use of any
Intellectual Property right and such infringement or unlawful use would not have occurred but for
such change.




     “DOJ” means the United States Department of Justice.



     “Dollars” and the symbol “$” each means the lawful currency of the United
States.



     “Employee Benefit Plans” is defined in Section 4.16(a) of this Agreement.



     “Employees” means those individuals employed by Seller in North Charleston, South
Carolina (as reflected in Seller’s payroll system for the North Charleston Facility) who are
employed primarily in connection with the Business as of the Closing Date and are set forth on
Schedule 8.1(a)(i) (as updated pursuant to this Agreement), including individuals stationed
with or assigned to subcontractors of the Business (including field service, surveillance and
quality control personnel) or assigned to Buyer’s manufacturing facilities, other than the Retained
Employees. Employees shall also include the employees of Seller set forth on Schedule
6.10(c)(ii) and any employees hired by Seller in the normal course of business, in compliance
with this Agreement, to serve in North Charleston, South Carolina primarily in connection with the
Business during the period beginning on the date hereof and ending on the Closing Date.



     “Encumbrance” means any mortgage, lien, pledge, encumbrance (including, in the case of
real property, easements, rights of way, covenants, leases, licenses, zoning and setback
requirements and other variances), security interest, deed of trust, option, encroachment, order,
decree, judgment lien, charge or other third-party rights of any kind, including in the case of
Intellectual Property, license rights or ownership interests other than those arising pursuant to a
Purchased Contract.



     “Engineering Services Agreement” is defined in Section 9.1(e)(v) of this
Agreement.



     “Environmental Claim” means any Claim, or any written notice of violation, citation or
other similar written communication alleging a violation of or Liability under any Environmental
Law, any government-mandated investigative, enforcement, cleanup, removal, containment, remedial,
or other governmental or regulatory action or proceeding threatened in writing, instituted or
completed pursuant to any applicable Environmental Law, against Seller and/or the Business with
respect to any condition, use or activity of the Purchased Assets or at the North Charleston Real
Property and/or the North Charleston Facility and any Claim, or any written
allegation, demand, suit, tender, recovery or contribution action threatened or made by any
person against Seller or against or with respect to the Purchased Assets, including any condition,



6









 




use or activity of the Purchased Assets or at the North Charleston Real Property and/or the North
Charleston Facility relating to Losses resulting from or in any way arising in connection with any
Hazardous Material or breach of Environmental Law during Seller’s use or occupancy of the North
Charleston Real Property and/or the North Charleston Facility.




     “Environmental Insurance Policy” is defined in Section 6.13(c) of this
Agreement.



     “Environmental Laws” means any Law or Order that pertains to pollution control or
natural resource or environmental protection, including Laws and Orders relating to (i) the
manufacture, processing, use, distribution, treatment, storage, disposal, generation or
transportation of Hazardous Materials; (ii) air, surface, ground, water or noise pollution;
(iii) any Release; (iv) the protection of wildlife, endangered species, wetlands or other natural
resources; and (v) the protection of the health and safety of employees; including the following
statutes and regulations adopted thereunder: (A) the Comprehensive Environmental Response,
Compensation and Liability Act, as amended by the Superfund Amendments and Reauthorization Act of
1986, 42 U.S.C. § 9601 et seq. (“CERCLA”); (B) the Solid Waste Disposal Act, as amended by
the Resource Conservation Recovery Act and the Hazardous and Solid Waste Amendments of 1984, 42
U.S.C. § 6901 et seq. (“RCRA”); (C) the Federal Water Pollution Control Act, as amended by
the Clean Water Act of 1977, 33 U.S.C. § 1251 et seq.; (D) the Clean Air Act, as amended, 42 U.S.C.
§ 7401 et seq.; (E) the Toxic Substances Control Act, 15 U.S.C. § 2601 et seq. (“TSCA”);
(F) the Safe Drinking Water Act, 42 U.S.C. §§ 300f through 300j; (G) the Hazardous Materials
Transportation Act, 49 U.S.C. § 1801 et seq. (“HMTA”); (H) the Oil Pollution Act of 1990,
33 U.S.C. § 2701 et seq.; (I) the Emergency Planning and Community Right-to-Know Act, 42 U.S.C. §
11001 et seq.; and (J) the Occupational Safety and Health Act, 19 U.S.C. § 6251 et seq.



     “Environmental Permit” is defined in Section 4.14(d) of this Agreement.



     “ERISA” means the Employee Retirement Income Security Act of 1974, as amended, and all
Laws promulgated pursuant thereto or in connection therewith.



     “ERISA Affiliate” means any trade or business that is treated as a single employer
with Seller under Sections 414(b), (c) or (m) of the Code or that must be aggregated with Seller
under Section 414(o) of the Code.



     “Estimated Adjusted Net Investment Amount” is defined in Section 3.3(a) of
this Agreement.



     “Estimated Preliminary Statement” is defined in Section 3.3(a) of this
Agreement.



     “Excluded Assets” is defined in Section 2.2(b) of this Agreement.



     “Excluded Contracts” is defined in Section 2.2(b)(vi) of this Agreement.



     “Excluded Liabilities” is defined in Section 2.3(b) of this Agreement.



     “Facilities” means all plants, offices, manufacturing facilities, stores, warehouses,
administration buildings and related facilities and fixtures owned or leased on the date hereof
(and those owned or leased after the date hereof but on or before the Closing) by Seller and



7









 




located on the North Charleston Real Property; provided that the term “Facilities” shall
not include any plants, offices, manufacturing facilities, stores, warehouses, administration
buildings and related facilities and fixtures located on the Pad Premises, as such term is defined
in the GA Sublease and more particularly described in Exhibit B of the GA Sublease.




     “Facilities Bill of Sale, Assignment and Assumption Agreement” is defined in
Section 9.1(e)(ix) of this Agreement.



     “FILOT Agreement” means that certain Fee Agreement by and among Charleston County,
South Carolina, Seller, GA and Boeing, which was authorized by Ordinance of Charleston County,
South Carolina passed and approved as of December 19, 2006.



     “Final Statement” is defined in Section 3.4(c) of this Agreement.



     “Financial Information” is defined in Section 4.4 of this Agreement.



     “Force Majeure Event” is defined in the definition of Material Adverse Effect in
Section 1.1 of this Agreement.



     “FTC” means the United States Federal Trade Commission.



     “G&A Cost Cap” means two million five hundred thousand Dollars ($2,500,000.00)
plus an amount equal to (i) two million five hundred thousand Dollars ($2,500,000.00)
multiplied by (ii) the number of days elapsed between June 28, 2009 and the Closing Date, divided
by 92.



     “G&A Costs” means the corporate general and administrative costs and costs associated
with shared services incurred by Seller and/or its Subsidiaries during the period beginning on (and
including) March 30, 2009 and ending on (and including) the Closing Date and allocated to the
Business conducted at the North Charleston Facility, in each case in accordance with the Agreed
Methodology.



     “GA” means Global Aeronautica, LLC, a Delaware limited liability company.



     “GAAP” means United States generally accepted accounting principles, consistently
applied.



     “GA Sublease” means that certain Pad Sublease by and between Seller and GA, effective
as of August 25, 2006, pursuant to which GA subleases a portion of the North Charleston Real
Property from Seller, as more specifically defined and set forth therein.



     “GA Sublease Assumption” is defined in Section 9.1(e)(xi) of this Agreement.



     “Governmental Authorization” means any permit, consent, license, certificate,
franchise, permission, variance, clearance, registration, qualification, authorization or approval
issued,
granted, given or otherwise made available by or under the authority of any Governmental
Entity or pursuant to any Law, including any Environmental Permit.



8









 





     “Governmental Entity” means the United States, any state or other political
subdivision thereof and any other foreign or domestic Person exercising or having the authority to
exercise executive, legislative, judicial, regulatory or administrative functions of or pertaining
to government, including any government authority, agency, department, board, commission or
instrumentality of the United States or any foreign Person, any state of the United States or any
other political subdivision of any of the foregoing.



     “Ground Lease” means that certain Charleston International Airport Ground Lease
Agreement by and between the Charleston County Aviation Authority, as lessor, and SCPR, as lessee,
dated as of August 25, 2006.



     “Guarantees” is defined in Section 6.20 of this Agreement.



     “Hazardous Material” means each and every element, compound, chemical mixture,
contaminant, pollutant, material or other substance that is defined, determined or identified as
hazardous or toxic under any Environmental Law or the Release of which is prohibited or regulated
under any Environmental Law, including (i) any “hazardous substance,” “extremely hazardous
substance” or “pollutant or contaminant” as those terms are defined in CERCLA; (ii) any “hazardous
waste” as that term is defined in RCRA; (iii) any “hazardous material” as that term is defined in
the HMTA; (iv) any “chemical substance or mixture” as that term is defined in TSCA; (v) petroleum
and petroleum products and byproducts; (vi) asbestos; and (vii) radioactive or explosive materials.



     “Hire Date” is defined in Section 8.2 of this Agreement.



     “HMTA” is defined in the definition of Environmental Laws in Section 1.1 of
this Agreement.



     “Inbound License Agreement” means each Purchased Contract (other than a Material
Contract) pursuant to which Seller receives a license to Intellectual Property.



     “Income Tax” or “Income Taxes” means any income, alternative minimum,
accumulated earnings, personal holding company, franchise, capital, single business, net worth,
gross receipts or similar taxes, including any estimated tax, interest, penalties or additions to
tax or additional amounts in respect to the foregoing, including any transferee or secondary
liability for any such tax and any Liability assumed by agreement or arising as a result of being
or ceasing to be a member of any affiliated group, or being included or required to be included in
any Income Tax Return relating thereto.



     “Income Tax Return” means, with respect to any Income Tax, any information return for
such Income Tax, and any return, report, statement, declaration, claim for refund or document filed
or required to be filed under the Law for such Income Tax.



     “Indebtedness” means, with respect to a Person, all Liabilities and obligations of
such Person (i) for borrowed money (including all accrued and unpaid interest and all prepayment
penalties or premiums in respect thereof) or issued in substitution for or exchange of
indebtedness for borrowed money; (ii) for any indebtedness evidenced by notes, debentures, bonds or
other similar instruments (including all accrued and unpaid interest and all prepayment



9









 




penalties
or premiums in respect thereof); (iii) under any conditional sale, title retention or similar
arrangement, or with respect to any deferred purchase price of any Assets or services (but
excluding trade accounts payable arising in the ordinary course of business consistent with past
practice); (iv) to reimburse any obligor on any letter of credit or similar credit transaction
securing obligations of any Person, to the extent such letter of credit or similar obligation has
been drawn; (v) to pay rent or other amounts under any lease of real or personal property that is
required to be classified or accounted for as a capital lease in accordance with GAAP; (vi)
constituting a guarantee of any Liabilities or obligations of any other Persons of the type
described in the foregoing clauses (i) through (v); and (vii) any liability or obligation of the
type described in the foregoing clauses (i) through (v) of any other Person, secured by an
Encumbrance on any of such Person’s Assets.




     “Indemnified Persons” is defined in Section 11.3(a) of this Agreement.



     “Indemnifying Person” is defined in Section 11.4(a) of this Agreement.



     “Initial Restricted Employees” means the Transferred Employees.



     “Intellectual Property” means any and all of the following, and all rights arising out
of or associated therewith, in each case in any jurisdiction in the world: (i) Patents; (ii)
Copyrights, (iii) Trademarks; (iv) Trade Secrets; (v) Software; (vi) rights to use the names,
likenesses and other personal characteristics of any individual, including rights of privacy and
publicity; and (vii) all other intellectual property or industrial property rights.



     “Intellectual Property Assignments” is defined in Section 9.1(e)(iii) of this
Agreement.



     “Intellectual Property License Agreement” is defined in Section 9.1(e)(iv) of
this Agreement.



     “Interim Financial Information” is defined in Section 6.17 of this Agreement.



     “Inventory” is defined in Section 2.2(a)(iii) of this Agreement.



     “IRS” means the U.S. Internal Revenue Service.



     “Joint SBP Activity Invention(s)” is defined in the 787 Supply Agreement.



     “Joint SBP Activity Proprietary Information” is defined in the 787 Supply Agreement.



     “Knowledge” means, with respect to Seller, the actual knowledge of (i) Kevin
McGlinchey, Keith Howe, Jeff McRae, Ron Muckley, Susie Kent, Joy Romero, Tom Mann, Casey Litaker
and Ron Vuz for all purposes hereunder; (ii) for purposes of Section 4.10 only, Bryan
Tutor, Seturah Foxx and Tom Stubbins; (iii) for purposes of Section 4.9(c)(iii) only, Jerry
Edmondson; (iv) for purposes of Sections 4.9 and 4.11 only, Randy Smith, (v) for
purposes of Section 4.11 only, Pat Russell, George Briggs, Cliff Collier and Tom Stubbins;
(vi) for purposes
of Section 4.12 only, Seturah Foxx; (vii) for purposes of Section 4.13 only,
Jerry Edmondson, (viii) for purposes of Section 4.14 only, Joanne Romano; (ix) for purposes
of Section 4.15 only, Bob Roofner; (x) for purposes of Sections 2.3(a)(ii),
2.3(b)(ii) and 4.16 only, Cliff Collier and



10









 




Seturah Foxx; and (xi) for purposes of
Section 4.18 only, Doug McLean, and, with respect to Buyer, the actual knowledge of Bryan
Gerard, Henry Knies, Anthony Fisher, Joseph Lower and Edward Neveril.




     “Laws” means all foreign, federal, state, regional, county and local constitutions,
statutes, laws (including common laws), ordinances, regulations, rules, resolutions, Orders,
tariffs, writs, injunctions, awards (including awards of any arbitrator), judgments and decrees of
any and all Governmental Entities and the terms of any Governmental Authorizations.



     “Legal Proceeding” means any Claim commenced, brought, conducted or heard by or
before, any court or other Governmental Entity or any arbitrator or arbitration panel.



     “Lender Waiver” is defined in Section 6.21 of this Agreement.



     “Liability” means any and all debts, liabilities, guarantees, assurances, commitments
and obligations, whether asserted or unasserted, matured or unmatured, liquidated or unliquidated,
known or unknown, due or to become due.



     “Licensed Intellectual Property” means Intellectual Property licensed to Seller
pursuant to a Purchased Contract.



     “LOI” means that certain letter of intent dated as of April 17, 2009 by and between
Seller and Boeing.



     “Losses” means any and all losses, Liabilities, Claims, damages (including
consequential, special, punitive, exemplary and incidental damages), penalties, fines, amounts paid
in settlement, taxes, liens, costs and expenses (including interest, penalties, reasonable
attorneys’ and accountants’ fees and disbursements and all amounts paid in investigation, defense
or settlement of any of the foregoing) or diminution of value, of any nature whatsoever, including
any of the foregoing or portion thereof that may occur after the Closing but relate to the period
prior to the Closing.



     “Material Adverse Effect” means any effect that (i) is, or is reasonably likely to be,
materially adverse to the operations, properties, assets, Liabilities, financial condition or
results of operations of the Business, taken as a whole, or (ii) would be reasonably expected to
materially impede or delay Seller’s ability to consummate the transactions contemplated by this
Agreement in accordance with its terms and applicable Laws or otherwise to perform its obligations
hereunder; provided that, in the case of each of clause (i) and (ii) above, any effect to
the extent resulting from any of the following shall not be taken into account in determining
whether any Material Adverse Effect has occurred or whether a Material Adverse Effect would be
reasonably likely to occur: (A) changes in economic, business, financial or political conditions
that affect the industries in which the Business operates so long as such changes do not have a
materially disproportionate effect on the Business, (B) acts of terrorism or war, (C) any adverse
effect, event, occurrence, development, circumstance, change or condition to the extent relating to
or arising out of (I) the design, manufacture, production, sale, operation and
support of the 787 aircraft program by any Person other than Seller, (II) any actual or
alleged breach of the 787 Supply Agreement or any Seller Supply Agreement (other than those arising
from bad faith or willful misconduct of Seller) or (III) any customer, supplier, contractor or
sub-



11









 







contractor (in each case, other than Seller) or supplier contract, subcontract agreement or raw
materials relating to the 787 aircraft program or (D) any Excluded Liability to the extent not
impairing the Business from and after the Closing. In connection with determining whether any
Material Adverse Effect has occurred or would be reasonably likely to occur as a result (in whole
or in part) of Seller or the Purchased Assets suffering a Force Majeure Event, the effects
resulting from such Force Majeure Event shall be taken into account notwithstanding the limitations
set forth in clause (C) above. For purposes of this definition, “Force Majeure Event”
means any act of God, flood, fire, hurricane or other casualty, earthquake, or any other events or
circumstances not within the reasonable control of Seller that are substantially similar to any of
the foregoing (other than any matter described in clause (A) and (B)), in each case occurring after
the date of this Agreement.



     “Material Contract” is defined in Section 4.11(a) of this Agreement.



     “Minimum Terms and Conditions of Employment” is defined in Section 8.2(a) of
this Agreement.



     “Multiemployer Plan” is defined in Section 4.16(d) of this Agreement.



     “Neutral Auditor” is defined in Section 3.4(c) of this Agreement.



     “New Seller Engineering Employees” means the engineering employees who are first
employed by Seller or any of its Subsidiaries in Seller’s Dallas, Texas facilities after the
Closing Date (other than Seller Engineering Employees).



     “Non-Assigned Contract” is defined in Section 6.3(b) of this Agreement.



     “Non-Disclosure Agreement” means that certain Non-Disclosure Agreement, dated as of
March 17, 2009, by and between Seller and Boeing.



     “North Charleston Facility” means the Facilities in North Charleston, South Carolina.



     “North Charleston Real Property” means the parcel of real property which is subject to
the North Charleston Sublease.



     “North Charleston Sublease” means that certain Ground Sublease by and between Seller
and South Carolina Public Railways (“SCPR”), dated as of August 25, 2006, pursuant to which
Seller subleases the parcel of real property on which the North Charleston Facility is located.



     “North Charleston Sublease Assumption” is defined in Section 9.1(e)(x) of this
Agreement.



     “Objection Notice” is defined in Section 3.4(b) of this Agreement.



     “Offer” is defined in Section 8.1(a) of this Agreement.



     “Offer Consideration Period” is defined in Section 8.2(a) of this Agreement.



12









 





     “Open Source Software” means Software that is “open source” or “copyleft” as those
terms are commonly understood in the Software industry, including any Software that is:
(i) distributed pursuant to a license or other agreement that requires licensees to disclose or
otherwise make available the source code for any software incorporating or using such licensed
software or developed using such licensed software, or to distribute or make available such
software on terms specified in such license or agreement; (ii) subject to the GNU General Public
License (GPL) or the GNU Lesser General Public License (LGPL) (in each case any version thereof) or
any license approved by the Open Source Initiative (as of the date hereof set forth at
http://opensource.org/licenses/index.html); or (iii) listed in the Free Software Directory
maintained by the Free Software Foundation (in cooperation with the United Nations Education,
Scientific and Cultural Organization (UNESCO)) (as of the date hereof set forth at
http://directory.fsf.org/).



     “Order” means any award, final decision, injunction, judgment, order, decree, ruling
or verdict entered, issued, made or rendered by any court, administrative agency or other
Governmental Entity, or by any arbitrator or arbitration panel.



     “Outstanding Encumbrances” means those Encumbrances identified on Schedule
1.1C.



     “Party” means, individually, either of Buyer or Seller, and “Parties” means
all of the foregoing collectively.



     “Patents” means any and all of the following, and all rights arising out of or
associated therewith, in each case, in any jurisdiction in the world: patents and patent
applications (including reissues, re-examinations, divisions, renewals, extensions, provisionals,
continuations and continuations-in-part); inventions (whether or not patentable and whether or not
reduced to practice); invention disclosures; inventor’s certificates; moral or economic rights of
inventors; industrial designs; and all registrations and applications thereof.



     “Pay-off Amount” is defined in Section 9.1(d) of this Agreement.



     “Pay-off Letter” is defined in Section 9.1(d) of this Agreement.



     “Permitted Encumbrance” means (i) Encumbrances identified on Schedule 1.1D;
(ii) warehouse, mechanics’, materialmen’s and similar liens imposed by Law arising in the ordinary
course of business, with respect to amounts not yet due and payable or amounts being contested in
good faith through appropriate proceedings initiated after the date hereof in compliance with this
Agreement; (iii) liens for Taxes not yet due and payable or being contested in good faith through
appropriate proceedings initiated after the date hereof in compliance with this Agreement and for
which adequate reserves have been established in accordance with GAAP; (iv) with respect to the
North Charleston Real Property, (x) any easement, covenant, condition, restriction or Encumbrance
of record, which exceptions are identified on or attached to Schedule 1.1D, (y) any
conditions or defects that are shown on the survey prepared by HGBD Surveyors, LLC dated May 18,
2009, and (z) such other Encumbrances that do not impair the current use or occupancy of the assets
subject thereto; and (v) orders and decrees that do not impair the current use or occupancy of the
assets subject thereto.



13









 





     “Person” means an individual, corporation, partnership, limited liability company,
joint venture, trust, trustee, unincorporated organization or other entity, including a
Governmental Entity.



     “Post-Closing Period” is defined in Section 7.1(a) of this Agreement.



     “Preliminary Statement” is defined in Section 3.4(a) of this Agreement.



     “Pre-Closing Period” is defined in Section 7.1(a) of this Agreement.



     “Pre-Closing Product” is defined in the definition of Covered Product in Section
1.1 of this Agreement.



     “Product” is defined in the 787 Supply Agreement.



     “Program Aircraft” means a (i) commercial transport aircraft having a current model
designation of 787 as of Closing and (ii) any derivative thereof, as such term is commonly
understood in the commercial aircraft industry.



     “Purchased Assets” is defined in Section 2.2(a) of this Agreement.



     “Purchased Contracts” is defined in Section 2.2(a)(i) of this Agreement.



     “Purchased Intellectual Property” means: (i) all of the Intellectual Property listed
on Schedule 4.10(a) that is identified on Schedule 4.10(a) as Purchased
Intellectual Property; (ii) Seller’s rights in Joint SBP Activity Invention(s); (iii) Seller’s
rights in Joint SBP Activity Proprietary Information; (iv) Vought SBP Activity Invention(s); (v)
Vought SBP Activity Proprietary Information; (vi) all other Intellectual Property owned by Seller,
as of the date hereof or any time prior to the Closing, that was developed (or is being developed)
by or for Seller primarily for the Business (including Seller’s engineering work and engineering
resources, certification work, design work and data of the Business developed (or being developed)
primarily for the Business); and (vii) all rights associated with any of the foregoing, including
the right to sue and collect for past or future infringement, misappropriation or other
unauthorized use thereof, any and all corresponding rights that, now or hereafter, may be secured
throughout the world and all copies and tangible embodiments of any of the foregoing, and all
goodwill associated or arising in connection with any of the foregoing, in each case, other than
the Licensed Intellectual Property. Without limiting the generality of the foregoing, “Purchased
Intellectual Property” shall also include all of the following due or payable at Closing or
thereafter (A) any income, royalties, credits, prepaid expenses, deferred charges, advance
payments, security deposits, prepaid items, deposits and claims for refunds or reimbursements, in
each case, relating to any of the Purchased Intellectual Property, (B) all Claims, rights and
remedies of Seller against any third parties arising out of or relating to any of the Purchased
Intellectual Property, and (C) all rights under or pursuant to any warranties, representations and
guarantees made by suppliers, manufacturers, contractors or other Persons under Purchased Contracts
in connection with any products or services provided to Seller with respect to any Purchased
Intellectual Property.



14









 





     “Qualified Representations” means those representations and warranties set forth in:
the second sentence of Section 4.3(a); Section 4.3(b); Section 4.5(a);
clause (b) of Section 4.8; Section 4.11(a)(vi); Section 4.11(e); the first
and third sentences of Section 4.13(b); Section 4.13(c); the lead-in paragraph of
Section 4.14; Section 4.16(h); Section 4.16(l); clause (iii) of Section
4.17; and the penultimate sentence of Section 4.18.



     “RCRA” is defined in the definition of Environmental Laws in Section 1.1 of
this Agreement.



     “Referenced Definition” is defined in Section 1.2(f) of this Agreement.



     “Release” means any spilling, leaking, pumping, pouring, emitting, emptying,
discharging, injecting, escaping, leaching, dumping, discarding, depositing, dispersing, migration,
burying, abandoning or disposing into the environment of any Hazardous Materials that is prohibited
under any applicable Environmental Law.



     “Representative” means, with respect to a particular Person, any director, manager,
member, officer, employee, agent, consultant, advisor, Affiliate, financing source or other
representative of such Person, including legal counsel, accountants and financial advisors.



     “Required by Boeing” means, for the purposes of Section 11.2(c), any such
specification (subject to paragraph (F) of Section 11.2(c)), design, design or
specification change or method or process of design or manufacturing (or any change thereto) that
was (i) expressly set forth in (A) a written 787 loads, methods and allowables document issued by
Boeing or its Affiliates or (B) a written 787 common architecture design guide (the “787 Design
Build Guide”) issued by Boeing or its Affiliates, in each case as revised prior to the Closing
by Boeing or its Affiliates pursuant to subsequently issued written versions of any such document
or design guide, (ii) expressly set forth in any written change order initiated and issued by
Boeing or its Affiliates, except to the extent that (x) such change order is modified as a direct
result of collaboration with Seller and (y) the misappropriation, infringement or unlawful use in
question is attributable to the modification to such change order that resulted from such
collaboration, or (iii) developed or adopted by a design or configuration team chaired by a Boeing
employee and comprised of Boeing employees and employees of Seller and/or other 787 team members
and subsequently either (x) approved by a Design Decision Board that included a Boeing employee,
which approval was documented in an issued written Program Design Decision Memorandum, or (y)
expressly set forth in any issued 787 Design Build Guide.



     “Resolution Period” is defined in Section 3.4(b) of this Agreement.



     “Restricted Period” in defined in Section 6.10(a) of this Agreement.



     “Retained Employees” means those individuals set forth on Schedule 1.1E.



     “Retained Intellectual Property” is defined in Section 2.2(b)(xi) of this
Agreement.



     “Review Period” is defined in Section 3.4(b) of this Agreement.



15









 





     “SCPR” is defined in the definition of North Charleston Sublease in Section
1.1 of this Agreement.



     “Seller” is defined in the Preamble to this Agreement.



     “Seller Contract” means any Contract to which Seller is a party.



     “Seller Cure Period” is defined in Section 10.1(b)(i) of this Agreement.



     “Seller Engineering Employees” means the engineering employees who are employed by
Seller or any of its Subsidiaries in Seller’s Dallas, Texas facilities as of the Closing Date and
set forth on Schedule 6.10(c)(i) (which Schedule will be updated at Closing to reflect new
hires) excluding the engineering employees set forth on Schedule 6.10(c)(ii).



     “Seller 401(k) Plan” is defined in Section 8.6(b) of this Agreement.



     “Seller Indemnified Persons” is defined in Section 11.3(a) of this Agreement.



     “Seller Senior Credit Agreement” means that certain Credit Agreement, dated as of
December 22, 2004, among Seller, as borrower, the several lenders party thereto, Lehman Commercial
Paper Inc., as administrative agent, JPMorgan Chase Bank, N.A., as syndication agent and Goldman
Sachs Credit Partners L.P., as documentation agent.



     “Seller Supply Agreements” means the supplier and sub-contractor agreements entered
into by Seller in connection with the Business.



     “Site Development and Incentive Agreement” means (i) that certain Project Emerald
Confidential Site Development and Incentive Agreement by and among Seller, on behalf of Project
Emerald, the South Carolina Department of Commerce, SCPR, Charleston County, South Carolina and the
Charleston County Airport District and (ii) that certain Confidential Initial Site Development and
Incentive Agreement between Seller on behalf of itself and two other entities; the South Carolina
Department of Commerce; SCPR; Charleston County, South Carolina and the Charleston County Airport
District, dated November 29, 2004.



     “Software” means any and all software of any type (including programs, applications,
middleware, utilities, tools, drivers, firmware, microcode, scripts, batch files, JCL files,
instruction sets and macros) and in any form (including source code, object code and executable
code), databases and associated data and related documentation, and all rights arising out of or
associated with any of the foregoing, in each case in any jurisdiction in the world.



     “SOW Administrative Agreement” is defined in Section 9.1(e)(xvii) of this
Agreement.



     “SOW Side Letter” is defined in Section 9.1(e)(xii) of this Agreement.



     “SOW Supply Agreement” is defined in Section 9.1(e)(viii) of this Agreement.



     “SOW Warranty Agreement” is defined in Section 9.1(e)(xvi) of this Agreement.



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     “Special Initiatives Agreement” means that certain special initiatives letter
agreement dated as of April 17, 2009 by and between Seller and Boeing.



     “Straddle Period” means any Tax year or period beginning on or before the Closing Date
and ending after the Closing Date.



     “Subsidiary” or “Subsidiaries” means, with respect to any Person, any
corporation, limited liability company, partnership or other legal entity of which such Person
(either alone or through or together with any other Subsidiary) owns, directly or indirectly, more
than fifty percent (50%) of the stock or other equity interests the holder of which is generally
entitled to vote for the election of the board of directors or other governing body of such
corporation, limited liability company, partnership or other legal entity.



     “Supplied Product” is defined in Section 11.2(c) of this Agreement.



     “Supplier Infringement Claim” is defined in Section 11.2(c) of this Agreement.



     “Tangible Personal Property” is defined in Section 2.2(a)(ii) of this
Agreement.



     “Tax” or “Taxes” means a tax or taxes of any kind or nature, or however
denominated, including Liability for federal, state, local or foreign sales, use, transfer,
registration, ad valorem, business and occupation, value added, excise, severance, natural
resources, environmental, stamp, premium, windfall profit, customs, duties, real property, personal
property, capital stock, social security, unemployment, disability, payroll, license, employee, fee
in-lieu of a Tax or other withholding, or other tax, of any kind whatsoever, whether disputed or
not, including any interest, penalties or additions to tax or additional amounts in respect to the
foregoing, including any transferee or secondary Liability for a tax and any Liability assumed by
agreement or arising as a result of being or ceasing to be a member of any affiliated group, or
being included or required to be included in any tax return relating thereto; provided,
however, that “Tax” or “Taxes” shall not include any Income Taxes or Transfer Taxes.



     “Tax Authority” means any Governmental Entity having the power to regulate, impose or
collect Taxes, including the IRS and any state department of revenue.



     “Tax Benefit” is defined in Section 11.5(b) of this Agreement.



     “Tax Benefit Objection Notice” is defined in Section 11.5(b) of this
Agreement.



     “Tax Returns” means, with respect to any Tax, any information return for such Tax, and
any return, report, statement, declaration, claim for refund or document filed or required to be
filed under the Law for such Tax; provided, however, that “Tax Returns” shall not include
any “Income Tax Returns.”



     “Terminating Buyer Breach” is defined in Section 10.1(b)(ii) of this
Agreement.



     “Terminating Seller Breach” is defined in Section 10.1(b)(i) of this
Agreement.



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     “Termination and Mutual Release Agreement” is defined in Section 6.16 of this
Agreement.



     “Third Party Claim” is defined in Section 11.4(a) of this Agreement.



     “Trademarks” means any and all of the following, and all rights arising out of or
associated therewith, in each case, in any jurisdiction in the world: trademarks; service marks;
certification marks; trade names; corporate names; domain names; logos; trade dress; and other
protectable indicia of source or origin, including unregistered and common law rights in the
foregoing; all translations, adaptations, derivations and combinations of any of the foregoing; all
goodwill associated with each of the foregoing; and all registrations of and applications to
register any of the foregoing.



     “Trade Secrets” means any and all of the following, and all rights associated
therewith, in each case, in any jurisdiction in the world: trade secrets; know-how; and other
confidential or proprietary information; in each case in any form or medium, and which in each case
may include research and development plans or results, formulas, compositions, manufacturing and
production processes and techniques, manufacturing plans, setup methodologies, facilities and
process flow, technical data, designs, drawings, specifications, customer and supplier lists,
pricing and cost information, financial reports and information, and business and marketing plans
and proposals.



     “Transaction Documents” means, collectively, this Agreement, including the Schedules
and Exhibits to this Agreement, the Bill of Sale, Assignment and Assumption Agreement, the
Intellectual Property Assignments, the Transition Services Agreement, the Intellectual Property
License Agreement, the Engineering Services Agreement, the SOW Supply Agreement, the Termination
and Mutual Release Agreement, the North Charleston Sublease Assumption, the GA Sublease Assumption,
the Facilities Bill of Sale, Assignment and Assumption Agreement, the Boeing Guaranty, the SOW Side
Letter, the SOW Warranty Agreement, the SOW Administrative Agreement, the 747 Amendment, the 767
Amendment, the 777 Amendment and every other Contract, certificate, instrument and document
executed and delivered at the Closing in accordance with Sections 9.1 and 9.2
hereof.



     “Transaction Expenses” means, as to a Party, the fees, costs and expenses incurred by
such Party and its Affiliates in connection with the investigation, diligence, negotiation,
preparation, execution and delivery of this Agreement and the Transaction Documents, and
performance of the transactions contemplated hereby and thereby, including accounting, legal,
consulting and other professional service fees, expenses and disbursements of consultants,
advisors, financing sources (including any cost, expense, fee, premium or penalty associated with
the Lender Waiver) and other Representatives, but excluding any Transfer Taxes.



     “Transfer Taxes” means all transfer, documentary, sales, use, stamp, registration and
other such similar Taxes and fees (including any penalties and interest) incurred in connection
with this Agreement and the transactions contemplated hereby; provided, however,
that for the avoidance of doubt “Transfer Taxes” shall not include any Income Taxes payable by
reason of the transactions contemplated by this Agreement.



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     “Transferred Employees” is defined in Section 8.1 of this Agreement.



     “Transferred Permits” is defined in Section 2.2(a)(vii) of this Agreement.



     “Transition Services Agreement” is defined in Section 9.1(e)(vi) of this
Agreement.



     “TSCA” is defined in the definition of Environmental Laws in Section 1.1 of
this Agreement.



     “UE Offer” is defined in Section 8.3(c) of this Agreement.



     “Union” means the District Lodge 96 of the International Association of Machinists and
Aerospace Workers.



     “Union Employees” is defined in Section 8.2(f) of this Agreement.



     “United States” and “U.S.” each means the United States of America.



     “Vought SBP Activity Invention(s)” is defined in the 787 Supply Agreement.



     “Vought SBP Activity Proprietary Information” is defined in the 787 Supply Agreement.



     “WARN Act” means the Worker Adjustment and Retraining Notification Act of 1988, as
amended.



     “Wetlands
Permit” is defined in Section 6.3(d) of this Agreement.



     Section 1.2 Construction. For purposes of this Agreement:




          (a) Whenever the context requires, the singular number will include the plural, and vice
versa, the masculine gender will include the feminine and neuter genders, the feminine gender will
include the masculine and neuter genders, and the neuter gender will include masculine and feminine
genders.




          (b) The words “include” and “including,” and variations thereof, will not be deemed to be
terms of limitation, but rather will be deemed to be followed by the words “without limitation.”




          (c) Except as otherwise indicated, all references in this Agreement to “Schedules,” “Sections”
and “Exhibits” are intended to refer to Schedules, Sections and Exhibits to this Agreement.




          (d) The terms “hereof,” “hereunder,” “herein” and words of similar import will refer to this
Agreement as a whole and not to any particular provision of this Agreement.




          (e) Each Party has participated in the drafting of this Agreement, which each Party
acknowledges is the result of extensive negotiations between the Parties, and consequently,
this Agreement will be interpreted without reference to any rule or precept of Law to the
effect that any ambiguity in a document be construed against the drafter.




19









 








          (f) To the extent any definition provided in Section 1.1 refers to a definition in the
787 Supply Agreement (each, a “Referenced Definition”) and the applicable Referenced
Definition has embedded in it other definitions from the 787 Supply Agreement, then for purposes of
interpreting the Referenced Definition such embedded definitions shall have the meanings ascribed
to such terms in the 787 Supply Agreement.




          (g) For the avoidance of doubt, “representations and warranties” will not be deemed to be
“agreements” between the Parties for purposes of Sections 9.1(b), 9.2(b),
10.1(c), 11.2(a)(ii) and 11.3(a)(ii).




ARTICLE II




PURCHASE AND SALE OF ASSETS AND ASSUMPTION OF LIABILITIES




     Section 2.1 Purchase of Assets and Assumption of Certain Liabilities. Upon the terms
and subject to the conditions of this Agreement and the other Transaction Documents, on the Closing
Date:



          (a) Seller shall sell, assign, transfer, convey and deliver to Buyer, and Buyer shall purchase
and acquire from Seller, the Purchased Assets, free and clear of all Encumbrances, other than
Permitted Encumbrances; and




          (b) Buyer shall assume, and agree to perform, pay and discharge, the Assumed Liabilities.




     Section 2.2 Purchased and Excluded Assets.



          (a) The “Purchased Assets” shall mean all of Seller’s right, title and interest in and
to the Assets that are owned, leased, licensed, used or held for use by Seller in connection with
the Business (other than the Excluded Assets), in each case wherever located, including the
following:




               (i) (A) the written Seller Contracts relating to the Business that are both (1) in effect as
of the date hereof and (2) set forth on Schedule 2.2(a)(i) and (B) any written Contract
primarily related to the Business entered into by Seller between the date hereof and the Closing in
compliance with this Agreement (the “Purchased Contracts”);



               (ii) all machinery, equipment, equipment subassemblies, tools, spare and replacement parts,
packaging materials, storage and shipping materials, vehicles, computer hardware and other hardware
(including servers, routers, desktops, laptops, peripherals and mobile computing devices), trade
fixtures, furniture, furnishings, office equipment and supplies, telephone and communications
equipment and any other fixed assets or tangible personal
property used or held for use in connection with the Business, including in each case those
items listed on Schedule 2.2(a)(ii), and including all of the foregoing located at the
North Charleston Facility (the “Tangible Personal Property”);



               (iii) all inventory, including raw materials, work-in-process and finished goods inventories,
tooling and supplies used or held for use in connection with the



20









 







Business and including any of the
foregoing held in consignment, bailment, or other similar arrangement by any third party or
Affiliates of Seller in connection with the Business (the “Inventory”), in each case as in
existence on the Closing Date;



               (iv) the North Charleston Facility (including all buildings, structures and improvements
thereon and all fixtures attached thereto), but excluding the North Charleston Real Property;



               (v) all rights to payments arising out of Purchased Contracts and all accounts and notes
receivable of the Business (except to the extent arising under any Excluded Contract), however
arising, including, in each case, all rights, Claims and remedies relating thereto and any related
deposits, security and collateral therefor (“Accounts Receivable”), in each case as in
existence on the Closing Date;



               (vi) all of the Purchased Intellectual Property;



               (vii) except as set forth on Schedule 2.2(b)(viii), all Governmental Authorizations
used or held for use by Seller in connection with the operation of the Business at the North
Charleston Facility and all pending applications therefor or renewals thereof (the “Transferred
Permits”);



               (viii) all credits, prepaid expenses and other items, deferred charges, advance payments,
security (including with respect to any wetland permit) and other deposits (including in respect of
bonding obligations of the Business) and claims for refunds or reimbursements, in each case,
relating to the Business or any of the Purchased Assets or Assumed Liabilities (except to the
extent arising under any Excluded Contract);



               (ix) all Claims, rights and remedies of Seller against any third parties arising out of or
relating to any of the Purchased Assets or Assumed Liabilities;



               (x) all rights under or pursuant to any warranties, representations and guarantees made by
suppliers, manufacturers, contractors or other Persons in connection with any products or services
provided to Seller in connection with the Business or with respect to any Purchased Asset (except
to the extent arising under any Excluded Contract);



               (xi) all books, records, ledgers, files, documents, correspondence, lists (including supplier
lists and records), files, plats, specifications, surveys, drawings, advertising and promotional
materials, reports (including manufacturing, research and development and production reports and
records), testing results, certification materials, service and warranty records, quality records
related to Products delivered to Boeing prior to the Closing Date, equipment logs, environmental,
safety and health plans, policies and procedures, copies of all personnel records related to
Transferred Employees (subject to Buyer obtaining any releases
required by applicable Law from the Transferred Employees), and other materials and
information (in whatever medium) in each case, to the extent relating exclusively to the Business
or to any of the Assumed Liabilities, Purchased Assets or Purchased Intellectual Property (the
“Business Books and Records”), in each case, as in existence as of the Closing Date;
provided that Seller may retain, subject to Section 6.9, copies of the foregoing;
and



21









 





               (xii) all goodwill associated or arising in connection with the Business or any of the
Purchased Assets, and to the extent assignable, IP addresses, telephone and fax numbers and
listings for the (789) prefix.



          (b) Excluded Assets. Notwithstanding the foregoing, except to the extent of rights
expressly provided in the Transition Services Agreement, the Engineering Services Agreement, the
SOW Supply Agreement and the Intellectual Property License Agreement, Seller will retain all right,
title and interest in and to, and the Purchased Assets will not consist of, all of Seller’s right,
title and interest in and to the following assets, rights or properties (the “Excluded
Assets”):




               (i) except as set forth in Section 6.13, all cash or cash equivalents, including all
marketable securities, certificates of deposit and other similar liquid Assets, at the time of the
Closing;



               (ii) all bank and other depository accounts and safe deposit boxes of Seller;



               (iii) all refunds of and credits for Taxes, Income Taxes and other Tax assets and Tax loss
carry forwards relating to any period or portion thereof ending on or prior to the Closing Date;



               (iv) any Employee Benefit Plans (including any Multiemployer Plan) and Assets (including any
related insurance proceeds) of, or any rights of Seller in, the Employee Benefit Plans and any
Contracts that constitute (or provide for services under) Employee Benefit Plans;



               (v) any of Seller’s corporate charters, franchises, seals, minute books, equity record books
and other similar documents relating to the organization, governance and existence of Seller or any
of its Subsidiaries;



               (vi) any Contract that is not a Purchased Contract, including any Collective Bargaining
Agreement, and all rights arising under such Contracts (collectively, the “Excluded
Contracts”);



               (vii) except as set forth on Schedule 2.2(a)(ii) and other than Purchased Intellectual
Property, Seller’s business, assets and operations (including all assets, properties and other
rights used or held for use in connection with engineering, design, supply management and business
management activities) located or conducted at its Milledgeville, Georgia and Dallas, Texas
facilities;



               (viii) the Governmental Authorizations, pending applications therefor or renewals thereof, set
forth on Schedule 2.2(b)(viii);



               (ix) all insurance policies of Seller related to the Business and, subject to Section
6.13, any Claims or rights thereunder;



22









 





               (x) any intercompany Accounts Receivable between Seller and Seller’s Affiliates (other than
Wesco Holdings, Inc. and its Subsidiaries);



               (xi) (a) all Intellectual Property owned by Seller (including Background Proprietary
Information of Seller and Background Invention(s) of Seller) other than the Purchased Intellectual
Property and (b) all other Intellectual Property of Seller (including Background Proprietary
Information of Seller and Background Invention(s) of Seller) other than the Purchased Intellectual
Property (collectively, the “Retained Intellectual Property”);



               (xii) all Tax and Income Tax books and records and all Income Tax Returns and Tax Returns of
Seller;



               (xiii) any securities, shares of capital stock or equity or other ownership interest of Seller
in any other Person (including any Subsidiary);



               (xiv) all books, records, ledgers, files, documents, correspondence, lists (including supplier
lists and records), files, plats, specifications, surveys, drawings, advertising and promotional
materials, reports (including manufacturing, research and development and production reports and
records), testing results, certification materials, service and warranty records, equipment logs,
copies of all personnel records related to Transferred Employees (for whom any release required by
applicable Law has not been obtained), and other materials and information (in whatever medium),
other than the Business Books and Records;



               (xv) except as set forth on Schedule 2.2(a)(ii) and other than Purchased Intellectual
Property, Business Books and Records and Purchased Contracts, all Assets, properties and other
rights used or held for use in connection with the provision of services and conduct or performance
of support functions (and the conduct or performance of functions and other activities relating to
such services and functions) provided to the North Charleston Facility and the Business by the
other facilities, businesses and operational or business units of Seller, including information
technology, human resources, supply chain management, configuration management, benefits
administration, payroll, accounting, treasury, legal, management, and other general and
administrative services, as well as any other services to be provided pursuant to the Transition
Services Agreement or the Engineering Services Agreement;



               (xvi) all rights and Claims in respect of, arising out of or relating to any Excluded
Liability;



               (xvii) any interest in real property (other than the North Charleston Real Property and any
interest set forth on Schedule 2.2(b)(xvii));



               (xviii) the Transaction Documents, the Non-Disclosure Agreement, the Special Initiatives
Agreement, and all rights or Claims of Seller arising under or relating to the foregoing documents
and agreements; and



               (xix) the tangible property and other assets set forth in Schedule 2.2(b)(xix).



23









 





     Section 2.3 Assumed and Excluded Liabilities.



          (a) The “Assumed Liabilities” shall consist of any and all Liabilities of Seller to
the extent arising out of, relating to or resulting from the Business (other than the Excluded
Liabilities and any and all Liabilities of Seller arising out of or related to Seller’s provision
of services or products to, or other dealings with, the Business from and after the Closing),
including:




               (i) any and all Liabilities of Seller arising out of, relating to, or incurred pursuant to,
the Purchased Contracts (including any and all Seller Supply Agreements that are Purchased
Contracts);



               (ii) any obligations of Seller set forth in Schedule 2.3(a)(ii) or assumed by Buyer
pursuant to Article VIII, in each case related to the employment of Employees who become
Transferred Employees, including any obligations of Seller (A) for accrued salaries, wages and
bonuses owed or payable to Transferred Employees (and related withholdings and payroll Taxes);
(B) for accrued but unpaid or unused vacation of Transferred Employees; and (C) for reimbursable
business expenses of Transferred Employees incurred in the ordinary course of business consistent
with past practice (other than the Excluded Liabilities described in Section 2.3(b)(ii));
and



               (iii) South Carolina personal property Taxes.



          (b) Excluded Liabilities. Notwithstanding anything to the contrary, Buyer shall not
assume or otherwise be obligated to pay, perform or discharge the following Liabilities, except to
the extent accrued in the categories listed in Appendix A and in the Adjusted Net
Investment Amount on the Final Statement (all of such Liabilities not so assumed by Buyer being
referred to herein as the “Excluded Liabilities”):




               (i) any and all Environmental Claims (whether asserted before or after the Closing) arising
out of, relating to or resulting from the conduct of the Business prior to the Closing;



               (ii) subject to Article VIII, any and all Claims by or for the benefit of any current
or former employee of the Business (whether asserted before or after the Closing) and not disclosed
on the Disclosure Schedules arising out of, relating to or resulting from (A) any tort of which
Seller has Knowledge committed by Seller against any employee of Seller, or breach or default by
Seller of any Contract between Seller and any of its employees, of which Seller has Knowledge, or
violation of any Law by Seller relating to the employment of the
current or former employee asserting such Claim of which Seller has Knowledge or (B) any
actual or alleged discrimination by the Company, any of its Subsidiaries or their respective
supervisory employees against any such employee, in the case of each of clause (A) and clause (B),
to the extent such Claim is asserted prior to the Closing or relates to conduct of Seller occurring
before the Closing;



               (iii) subject to Schedule 2.3(a)(ii) and Article VIII, any and all Claims
arising out of, relating to or resulting from a Collective Bargaining
Agreement between the Union and Seller other than any such Claims involving recall rights of laid-off employees after the
Closing;




24









 








               (iv) except for Liabilities under or pursuant to any Purchased Contracts and except to the
extent set forth in Schedule 2.3(a)(ii) or Article VIII or pursuant to the
Transition Services Agreement, any and all Liabilities arising out of, relating to or resulting
from any Employee Benefit Plan, any offer letter or any employee-related program, policy, funding
vehicle or Contract with any employee of Seller maintained or implemented by Seller or any of its
Affiliates, whether such Liability arises prior to, on or after the Closing Date;



               (v) any and all Liabilities, whether such Liabilities arise prior to, on or after the Closing
Date, arising out of, relating to or resulting from (A) any Multiemployer Plan of Seller or in
which Seller participates (including any withdrawal Liability or other Liability related to
unfunded or under-funded benefits), or (B) any obligation of Seller to provide or make available
post-retirement welfare benefits or welfare benefit coverage to any current or former officer,
director, stockholder or employee of the Business or Seller;



               (vi) any and all Liabilities of Seller arising out of, relating to or resulting from Taxes and
Income Taxes allocable to Seller under Section 7.1 hereof (except for Assumed Liabilities
under Section 2.3(a)(ii) and Section 2.3(a)(iii));



               (vii) any Indebtedness, including any Guarantees not listed on Schedule 6.20 or
otherwise permitted hereunder;



               (viii) any and all Liabilities (other than Liabilities disclosed hereunder or in the
Disclosure Schedules hereto and other than Liabilities to the extent arising out of, relating to or
resulting from any infringement, misappropriation or unlawful use of any Intellectual Property of
any Person by Seller in the operation of the Business prior to the Closing) arising out of,
relating to or resulting from any violation of Law by Seller prior to the Closing to the extent
that such Liabilities exceed, in the aggregate, $10,000,000;



               (ix) any and all Liabilities not arising out of, relating to or resulting from the Business;



               (x) except to the extent set forth in Schedule 2.3(a)(ii) or Article VII or
pursuant to the Transition Services Agreement, any and all Liabilities of Seller to the extent
arising out of, relating to or resulting from the Excluded Assets set forth in Sections
2.2(b)(i), (ii), (v), (vi), (vii), (ix), (x),
(xi)(b), (xiii), and (xviii) (other than Liabilities for which Buyer is
expressly liable pursuant to the Transition Services Agreement, the Engineering Services
Agreement, the Intellectual Property License Agreement, and with respect to recall rights
under the Collective Bargaining Agreement after the Closing); and



               (xi) any and all Liabilities of Seller arising out of, relating to or resulting from the
Excluded Assets described in Sections 2.2(b)(viii), (xi)(a), (xv) and
(xvii) to the extent not related to the conduct of the Business prior to the Closing.



25









 





ARTICLE III




AGGREGATE CONSIDERATION AND CLOSING




     Section 3.1 Closing. The closing of the transactions contemplated by this Agreement
(the “Closing”) will occur as promptly as practicable, but (subject to the proviso below)
in no event more than three (3) Business Days, following the satisfaction or waiver of all
conditions to the Closing set forth in Article IX (other than any of such conditions that
by its nature is to be satisfied at the Closing, but subject to the satisfaction or waiver of such
condition), at 10:00 a.m., local time, at the offices of Kirkland & Ellis LLP, 601 Lexington
Avenue, New York, New York 10022, or at such other place on such other date as the Parties may
agree in writing; provided that the Closing shall not occur prior to the thirteenth (13th)
Business Day following the date hereof, unless otherwise agreed by the Parties in writing. The
date on which the Closing actually occurs will be referred to as the “Closing Date,” and
the Closing will be deemed effective as of 11:59 p.m., Eastern Daylight Time, on the Closing Date.



     Section 3.2 Aggregate Consideration. Subject to the terms and conditions contained in
this Agreement and the Termination and Mutual Release Agreement, at the Closing, Buyer shall pay to
Seller an amount equal to Five Hundred Ninety-Eight Million Dollars ($598,000,000.00) (the
“Closing Payment Amount”), which amount shall be subject to adjustment as provided in
Section 3.3 below, by wire transfer of immediately available funds to the account
designated in writing by Seller (the Closing Payment Amount, together with the aggregate amount of
the Assumed Liabilities, sometimes being referred to herein as the “Aggregate
Consideration”); provided, that, in the event that any Indebtedness remains outstanding
under the Seller Senior Credit Facility as of the Closing Date, a portion of the Closing Payment
Amount equal to the Pay-off Amount will be paid by Buyer for the account of Seller to the agent
under the Seller Senior Credit Facility by wire transfer of immediately available funds to the
account designated in the Pay-off Letter and such payment shall be deemed to constitute payment to
Seller of a portion of the Closing Payment Amount equal to the Pay-off Amount.



     Section 3.3 Estimated Aggregate Consideration Adjustment.



          (a) No later than five (5) Business Days prior to the Closing Date, Seller shall deliver to
Buyer a written statement (the “Estimated Preliminary Statement”), prepared in good faith
and in accordance with the Agreed Methodology, setting forth an estimate of the Closing
Adjusted Net Investment Amount (the “Estimated Adjusted Net Investment Amount”) in the
same detail as reflected on Appendix A and including a reasonable explanation of any new
line item categories not shown on Appendix A.




          (b) If the Estimated Adjusted Net Investment Amount exceeds the Base Adjusted Net Investment
Amount, the Closing Payment Amount shall be increased dollar-for-dollar by the amount of such
excess, and if the Estimated Adjusted Net Investment Amount is less than the Base Adjusted Net
Investment Amount, the Closing Payment Amount shall be reduced dollar-for-dollar by the amount of
such shortfall.




26









 








     Section 3.4 Aggregate Consideration Adjustment.



          (a) Buyer shall deliver, or cause to be delivered, to Seller as soon as practicable, but in no
event more than ninety (90) days after the Closing Date, a preliminary written statement (the
“Preliminary Statement”) setting forth the Adjusted Net Investment Amount as of the Closing
Date (the “Closing Adjusted Net Investment Amount”), which amount shall be determined in
accordance with the Agreed Methodology.




          (b) Seller shall have sixty (60) days to review the Preliminary Statement from the date of its
receipt thereof (the “Review Period”). During the Review Period, Seller shall have
reasonable access during normal business hours to the books and records of the Business (and to the
non-privileged work papers of Buyer relating to the Business or the Purchased Assets that were used
in preparing the Preliminary Statement) to the extent required in connection with such review,
subject to Section 6.9. If Seller objects to any aspect of the Preliminary Statement,
Seller shall deliver a written notice of objection (the “Objection Notice”) to Buyer at or
prior to the expiration of the Review Period; provided that Seller may so object to the
Preliminary Statement based only on the existence of mathematical errors therein, on the failure of
the Preliminary Statement (or the calculations contained therein and determinations made in
connection therewith) to be prepared or determined in accordance with the Agreed Methodology, or
any other failure of Buyer to have complied with this Section 3.4, and on no other basis.
The Objection Notice shall specify any adjustment to the Preliminary Statement proposed by Seller
and the basis therefor, including in each case the specific items proposed to be adjusted (to the
extent determinable), the specific Dollar amount of each such adjustment and an explanation of how
such proposed adjustment was calculated. If Seller delivers an Objection Notice to Buyer prior to
the expiration of the Review Period as provided in this Section 3.4(b), Buyer and Seller
shall, for a period of thirty (30) days thereafter (the “Resolution Period”), exchange
reasonably detailed explanations of any disagreement and attempt to resolve the matters properly
contained therein, and any written resolution, signed by each of Buyer and Seller, as to any such
matter shall be final, binding, conclusive and non-appealable for purposes of this
Section 3.4. Except to the extent properly challenged in an Objection Notice as provided
in this Section 3.4(b), or in the event Seller does not deliver an Objection Notice to
Buyer as provided in this Section 3.4(b) prior to the expiration of the Review Period,
Seller shall be deemed to have agreed to the Preliminary Statement in its entirety, which
Preliminary Statement or undisputed portions thereof (as the case may be) shall be final, binding,
conclusive and non-appealable for purposes of this Section 3.4.




          (c) If, at the conclusion of the Resolution Period, Buyer and Seller have not reached an
agreement with respect to all disputed matters properly contained in the Objection Notice, then
within ten (10) Business Days thereafter, Buyer and Seller shall submit for resolution those of
such matters remaining in dispute to PricewaterhouseCoopers LLC, or if such firm is unavailable or
unwilling to so serve, to a mutually acceptable nationally recognized independent accounting firm
(the “Neutral Auditor”). The Neutral Auditor shall resolve (based solely on the written
presentations of Buyer and Seller and not by independent review) only those matters submitted to it
in accordance with the first sentence of this Section 3.4(c). The resolution of any such
disputed matter by the Neutral Auditor shall be limited (i) to whether the Preliminary Statement
and the calculations contained therein and determinations made in connection therewith were
prepared, calculated and determined with respect to such disputed




27









 




matter in accordance with the
Agreed Methodology and this Section 3.4; and (ii) if the Preliminary Statement has not been
so prepared or if necessary to correct any mathematical error in computing the Adjusted Net
Investment Amount, to modifying the Preliminary Statement and the calculations of the Closing
Adjusted Net Investment only to the extent necessary to reflect the recalculation of such disputed
matter in accordance with such Agreed Methodology. Buyer and Seller shall direct the Neutral
Auditor to render a resolution of all such disputed matters within thirty (30) days after its
engagement or such other period as is agreed upon in writing by Buyer and Seller. With respect to
each disputed item, Buyer and Seller shall instruct the Neutral Auditor not to assign a value
greater than the greatest value for such item assigned by Buyer, on the one hand, or Seller, on the
other hand, or less than the smallest value for such item assigned by Buyer, on the one hand, or
Seller, on the other hand. The resolution of the Neutral Auditor shall be set forth in a written
statement delivered to each of the Parties and shall be final, binding, conclusive and
non-appealable for all purposes hereunder. The Preliminary Statement, once modified and/or agreed
to in accordance with Section 3.4(b) or this Section 3.4(c), shall become the
“Final Statement.”




          (d) All fees and expenses relating to the work performed by the Neutral Auditor shall be split
equally between the Parties, and each of them shall promptly advance to the Neutral Auditor such
Party’s share of the expected fees and expenses (including any initial engagement fee) of the
Neutral Auditor (as determined by the Neutral Auditor) upon the request of the Neutral Auditor.
Except as provided in the preceding sentence, all other costs and expenses incurred by the Parties
in connection with resolving any dispute hereunder before the Neutral Auditor shall be borne by the
Party incurring such cost and expense.




          (e) Amounts payable pursuant to the determination of the Closing Adjusted Net Investment
Amount on the Final Statement will be paid as follows:




               (i) If the Closing Adjusted Net Investment Amount as stated on the Final Statement is less
than the Estimated Adjusted Net Investment Amount, then Seller shall pay to Buyer the amount by
which such Closing Adjusted Net Investment Amount is less than the Estimated Adjusted Net
Investment Amount, by wire transfer of immediately available funds to the account designated by
Buyer in writing, within three (3) Business Days after the date on which the Preliminary Statement
becomes the Final Statement.



               (ii) If the Closing Adjusted Net Investment Amount as stated on the Final Statement is greater
than the Estimated Adjusted Net Investment Amount, then Buyer shall
pay to Seller the amount by which such Closing Adjusted Net Investment Amount is greater than
the Estimated Adjusted Net Investment Amount, by wire transfer of immediately available funds to
the account designated by Seller in writing, within three (3) Business Days after the date on which
the Preliminary Statement becomes the Final Statement.



     Section 3.5 Allocation of Aggregate Consideration.



          (a) Within one hundred and twenty (120) days after the Closing Date, Buyer will provide to
Seller its proposed allocation for tax purposes of the Aggregate Consideration (and all other
capitalizable costs). The Aggregate Consideration shall be allocated among (i) the Purchased
Assets, (ii) the termination of the 787 Supply Agreement and release of Claims and




28









 




resolution of
any and all rights and obligations owed to by each of Seller and Boeing to the other related to the
787 Supply Agreement pursuant to the Termination and Mutual Release Agreement, and (iii) the other
rights granted by or agreements of Seller pursuant to the other Transaction Documents. The amount
allocated to the Purchased Assets shall be set forth on IRS Form 8594 and any required exhibits
thereto, prepared in accordance with Section 1060 of the Code (the “Allocation Statement”).




          (b) Seller will review the Allocation Statement and, to the extent Seller in good faith
disagrees with the content of the Allocation Statement, Seller will, within sixty (60) days after
receipt of the Allocation Statement, provide written notice to Buyer of such disagreement or will
be deemed to have indicated its concurrence therewith. Buyer and Seller will attempt in good faith
to resolve any such disagreement. If Buyer and Seller are unable to reach a good faith agreement
as to the content of the Allocation Statement within thirty (30) days after Buyer’s receipt of
Seller’s written notice of disagreement, Buyer and Seller will each file its own IRS Form 8594
using its own allocation statement consistent with its own allocation of the Aggregate
Consideration.




          (c) If Seller and Buyer agree on the Allocation Statement or any modification thereof, Seller
and Buyer will report the allocation of the total consideration among the Purchased Assets in a
manner consistent with such Allocation Statement or modification and will act in accordance with
such Allocation Statement in the preparation and timely filing of all Income Tax Returns (including
Form 8594 with their respective federal Income Tax Returns for the taxable year that includes the
Closing Date and any other forms or statements required by the Code, the IRS or any applicable Tax
Authority). Seller and Buyer agree to promptly provide the other Party with any additional
information and reasonable assistance required to complete Form 8594 or compute Income Taxes
arising in connection with (or otherwise affected by) the transaction contemplated hereunder.




          (d) Buyer and Seller will promptly inform each other in writing of any challenge by any
Governmental Entity to any allocation made pursuant to this Section 3.5 and each agrees to
consult with and keep the other informed with respect to the status of, and any discussion,
proposal or submission with respect to, any such challenge.




ARTICLE IV




REPRESENTATIONS AND WARRANTIES OF SELLER




     Seller hereby represents and warrants to Buyer as follows:



     Section 4.1 Organization and Qualification. Seller is a corporation duly organized,
validly existing and in good standing under the Laws of the State of Delaware. Seller has the
requisite corporate power and authority to own, lease, sublease or otherwise hold and operate the
Purchased Assets and to carry on the Business as presently conducted. Seller is duly qualified or
licensed and is in good standing to do business in each jurisdiction where Seller conducts its
business or where the character of the properties owned, leased, subleased or operated by Seller or
the nature of its business makes such qualification, licensing or good standing necessary, except
where the failure to be so qualified, licensed or in good standing would not have and



29









 




would not
reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.
Seller has made available to Buyer complete and correct copies of the certificate of incorporation
and bylaws of Seller.




     Section 4.2 Authorization; Enforceability. Seller has the requisite corporate power
and authority to enter into, execute and deliver this Agreement and each other Transaction Document
to which it is a party, to perform all of the obligations to be performed by it hereunder and
thereunder and to consummate the transactions contemplated hereby and thereby. The execution and
delivery by Seller of this Agreement and each other Transaction Document to which it is a party,
the performance of its obligations hereunder and thereunder and the consummation by Seller of the
transactions contemplated hereby and thereby have been duly authorized by all necessary corporate
action, and no other corporate action or proceeding is necessary to authorize the execution and
delivery of this Agreement and each other Transaction Document to which Seller is a party, the
performance of its obligations hereunder and thereunder or the consummation of the transactions
contemplated hereby and thereby. This Agreement has been, and each of the other Transaction
Documents to which Seller is a party will have been at the Closing, duly authorized, executed and
delivered by Seller and, assuming due authorization, execution and delivery by Buyer, this
Agreement constitutes, and each of the other Transaction Documents will constitute at Closing,
Seller’s valid and binding obligation, enforceable against it in accordance with its respective
terms, subject only to (i) applicable bankruptcy, insolvency, reorganization and moratorium Laws
and other Laws of general application affecting enforcement of creditors’ rights generally and
(ii) rules or Laws governing specific performance, injunctive relief and other equitable remedies.



     Section 4.3 No Conflicts.



          (a) Neither the execution and delivery of this Agreement or the other Transaction Documents to
which Seller is a party nor the performance by Seller hereunder and thereunder conflicts or will
conflict with or result in a material breach or violation of any of the terms or provisions of its
organizational documents or result in the material breach or violation
of any of the terms or provisions of, or constitute a default under, or accelerate the
performance required by the terms of any Seller Contract, except as would not reasonably be
expected to prevent or materially delay the consummation of the transactions contemplated hereby,
nor will any such action result in any material violation of the provisions of any material Law.
The execution and delivery by Seller of this Agreement and the other Transaction Documents to which
Seller is a party and the performance by Seller of its obligations hereunder and thereunder will
not require any additional consent or approval of, or any filing or registration with, any creditor
of Seller, any Governmental Entity or any party to any Material Contract, except for the Consents
and Governmental Authorizations set forth on Schedule 4.3(a), and except as would not
reasonably be expected to prevent or materially delay the consummation of the transactions
contemplated hereby. Neither the execution and delivery by Seller of this Agreement and the other
Transaction Documents to which Seller is a party nor the performance by Seller hereunder and
thereunder require the Consent (either as a matter of law, contractual obligation or otherwise) of
any of Seller’s stockholders.




          (b) The consummation of the transactions contemplated by this Agreement and the other
Transaction Documents will not (i) conflict with, violate or result in a breach of




30









 




any term or
provision of Seller’s organizational documents, (ii) materially conflict with or violate any Law
applicable to the Business, or by which any Purchased Asset is bound or affected, (iii) result in
the creation of any material Encumbrance on the Business or any material Purchased Asset, or
(iv) except as provided on Schedule 4.3(b), require any Consent or approval under, result
in any material breach of or any loss of any material benefit under, or modify, accelerate or
terminate any rights or obligations under, or constitute a default (or an event that with notice or
lapse of time or both would become a default) under, or give to others any right of termination,
vesting, amendment, acceleration or cancellation pursuant to, any Material Contract or material
Transferred Permit.




     Section 4.4 Financial Information. The calculation of the Adjusted Net Investment
Amount as of March 29, 2009 attached hereto as Appendix A reflects numbers used to prepare
Seller’s GAAP financials and was prepared in accordance with (a) the books and records of Seller
and its Subsidiaries and (b) the accounting practices, policies and methodologies used by Seller in
preparing its internal, unaudited financial statements. Schedule 4.4 sets forth copies of
internal, unaudited balance sheets of the Business as of December 31, 2007 and 2008 and the three
(3)-month period ended March 29, 2009 and the related statements of income and cash flows for the
periods then ended and Seller’s estimate of the Adjusted Net Investment Amount as of December 31,
2008 and 2007 (together with the internal, unaudited balance sheets of the Business as of April 26,
2009 and May 31, 2009 and the related statements of income and cash flows for the periods then
ended, the “Financial Information”). The Financial Information was prepared in the
ordinary course of business in accordance with (A) the books and records of Seller and its
Subsidiaries and (B) the accounting practices, policies and methodologies used by Seller in
preparing its internal, unaudited financial statements. Buyer acknowledges that the Financial
Information was not prepared in accordance with GAAP, does not include all of the information
required to be provided on a balance sheet or statement of income or cash flow prepared in
accordance with GAAP, includes estimates (which were based upon assumptions that management
believed to be reasonable at the time made) and does not purport to present fairly the financial
position, results
of operations or cash flows of the Business but does represent Seller’s good faith estimate of
the Adjusted Net Investment Amount as of March 29, 2009.



     Section 4.5 Absence of Certain Developments. Except as set forth on
Schedule 4.5, from January 1, 2009 through the date of this Agreement:



          (a) Seller has conducted the Business, in all material respects, in the ordinary course of
business consistent with past practice;




          (b) none of the Purchased Assets has sustained or incurred any material loss or damage
(whether or not insured against) on account of fire, flood, accident or other calamity;




          (c) Seller has not moved any material tangible Assets or transferred or relocated any
employees of the Business or limited or transitioned any material business activities utilized in
satisfying its obligations under the 787 Supply Agreement, in each case, from the North Charleston
Facility to any other location, except for such Assets, employees or business activities that have
been subsequently returned to the North Charleston Facility as of the date of this Agreement;




31









 








          (d) Seller has not adopted, materially increased, terminated, materially amended or otherwise
materially modified any Employee Benefit Plan other than in the ordinary course of business
consistent with past practice or as required by applicable Law;




          (e) Seller has not changed any accounting methods or practices (including any change in
depreciation or amortization policies or rates);




          (f) Seller has not entered into any Contracts or transactions or changed, modified or amended
any Contracts or transactions with any of Seller’s Affiliates that are involved in the Business or
any directors, managers, officers or employees of the Business;




          (g) Seller has not taken any action which, if taken after the date hereof, would be a breach
of Section 6.2(b) (other than Section 6.2(b)(viii)); and




          (h) Seller has not committed to, or entered into any Contract to, do any of the foregoing.




     Section 4.6 Absence of Undisclosed Liabilities. As of December 31, 2008, Seller had
no material Liabilities that would be included in the Assumed Liabilities and would be required to
be reflected in balance sheets (including the notes thereto) of the Business prepared in accordance
with GAAP, other than such Liabilities reflected on Schedule 4.6. Since December 31, 2008,
Seller has not incurred any material Liabilities that would be included in the Assumed Liabilities
and would be required to be reflected in balance sheets (including, as of the date of this
Agreement, the notes thereto) prepared in accordance with GAAP, except (a) as disclosed on
Schedule 4.6 or the other Schedules hereto, (b) Liabilities incurred in the ordinary course
of business since December 31, 2008 (to the Knowledge of Seller, as of the date of this Agreement, none of which is a
Liability for breach of warranty, tort or infringement), or (c) Liabilities under the Transaction
Documents.



     Section 4.7 Title; Sufficiency and Condition of Assets. Except as disclosed on
Schedule 4.7, Seller owns all right, title and interest in and to all material Assets
owned, leased, licensed, used or held for use by Seller in connection with the Business (other than
any Intellectual Property or any Licensed Intellectual Property, both of which are addressed in
Section 4.10, and any Excluded Assets), free and clear of all Encumbrances, except
Permitted Encumbrances and Outstanding Encumbrances. Upon delivery of the Purchased Assets to
Buyer and payment to Seller of the Closing Payment Amount, Buyer will acquire good and valid title
to such Purchased Assets (other than any Intellectual Property or any Licensed Intellectual
Property, both of which are addressed in Section 4.10) free and clear of all Encumbrances,
except Permitted Encumbrances and Outstanding Encumbrances and Encumbrances created by Buyer.
Except as disclosed on Schedule 4.7, the Purchased Assets, together with the Assets used to
provide services under the Transaction Documents, and the rights granted to Buyer under this
Agreement and the other Transaction Documents, constitute all material Assets (other than any
Intellectual Property or any Licensed Intellectual Property, both of which are addressed in
Section 4.10, and any Excluded Assets) necessary to conduct the Business substantially as
conducted by Seller as of the date of this Agreement. Except as would not reasonably be expected
to have, individually or in the aggregate, a Material Adverse Effect, all Tangible



32









 




Personal
Property included in the Purchased Assets, taken as a whole, is in reasonable operating condition
and repair (after allowing for ordinary wear and tear).




     Section 4.8 Inventory. Except as described on Schedule 4.8, all Inventory
(a) was acquired or produced in the ordinary course of business consistent with past practice;
(b) contains all appropriate forms of identification necessary to be in material compliance with
applicable Laws requiring configuration records to be maintained with respect to such Inventory;
and (c) is free and clear of all Encumbrances, except for Permitted Encumbrances and Outstanding
Encumbrances.



     Section 4.9 Real Property.



          (a) Seller does not own fee simple title to, or hold any leasehold interest in, any real
property used or held for use by Seller in connection with the Business, except as set forth in
Schedule 4.11(a)(vii).




          (b) North Charleston Sublease.




               (i) Seller has a valid subleasehold interest in and to the North Charleston Real Property free
and clear of any Encumbrances, except for Permitted Encumbrances and Outstanding Encumbrances.



               (ii) Other than the interest granted to GA under the GA Sublease, Seller is in full and
complete possession of the North Charleston Real Property described in the
North Charleston Sublease and, other than the interest granted to GA under the GA Sublease,
Seller has neither assigned nor sublet any portion thereof.



               (iii) Except pursuant to the Seller Senior Credit Agreement, Seller has not assigned its
interest as sub ground lessee (as defined in the North Charleston Sublease) under the North
Charleston Sublease to any other party.



               (iv) To Seller’s Knowledge, there are no third parties with (A) rights of first refusal to
lease the North Charleston Real Property that have not either waived or released such rights, or
(B) other rights to lease the North Charleston Real Property, that have not either waived or
released such rights.



          (c) Facilities. Other than with respect to Facilities contained within the area
subject to the GA Sublease:




               (i) Except to the extent leased pursuant to a Material Contract, Seller owns the Facilities
free and clear of any Encumbrances except for Permitted Encumbrances and Outstanding Encumbrances.



               (ii) To Seller’s Knowledge, the Facilities are connected to and/or serviced by water, sewage
disposal, waste disposal, gas and electric service for the Business’ operations therein.



33









 





          (d) GA Sublease. The GA Sublease (i) has been duly authorized, validly executed and
delivered by Seller and (ii) is valid and in full force and effect in accordance with its terms
against Seller. There is not any existing material default or event of default (or event that with
notice or lapse of time, or both, would constitute a default) of the GA Sublease by Seller.




          (e) Ground Lease.




               (i) To Seller’s Knowledge, (A) the Ground Lease has been duly authorized, validly executed and
delivered by the parties thereto, (B) the Ground Lease is valid and in full force and effect in
accordance with its terms against the parties thereto, and (C) there is not, under such Ground
Lease, any existing material default or event of default (or event that with notice or lapse of
time, or both, would constitute a default) by the parties to the Ground Lease.



               (ii) To Seller’s Knowledge, as of the date of this Agreement, the Ground Lease has not been
modified, orally or in writing, since execution, and no modifications are requested or pending in
writing.



               (iii) To Seller’s Knowledge, there is no dispute in writing between the Charleston County
Aviation Authority and SCPR concerning the Ground Lease.



               (iv) Seller has completed, or caused the completion of, all construction obligations of
“Operator” under the Ground Lease, including those set forth in Section 4.06(D) of the Ground
Lease.



     Section 4.10 Intellectual Property.



          (a) Schedule 4.10(a) sets forth a complete and accurate list as of the date of this
Agreement of all of the following Intellectual Property that is included in the Purchased
Intellectual Property or the Intellectual Property licensed to Buyer under the Intellectual
Property License Agreement: (i) all patented or registered Intellectual Property; (ii) all pending
patent applications or other applications for registration of Intellectual Property; and (iii) all
material Software (other than firmware). Schedule 4.10(a) also includes an indication of
whether each listed item constitutes Purchased Intellectual Property or Retained Intellectual
Property.




          (b) Other than such right, title and interest that is owned or licensed by Buyer and its
Affiliates, Seller owns all right, title and interest in and to all of the Purchased Intellectual
Property and Intellectual Property licensed to Buyer under the Intellectual Property License
Agreement, including the Intellectual Property set forth on Schedule 4.10(a), free and
clear of (i) all security interests, pledges or other consensual liens granted by Seller and (ii)
to the Knowledge of Seller, all other Encumbrances, except, in the case of the foregoing clauses
(i) and (ii), for Permitted Encumbrances and Outstanding Encumbrances. To the Knowledge of Seller,
Seller possesses a valid and enforceable right to use the Licensed Intellectual Property. Except
as set forth on Schedule 4.10(b), each Inbound License Agreement constitutes a legal,
valid, binding and enforceable obligation of Seller and, to Seller’s Knowledge, of the other party
or parties thereto and is enforceable in accordance with its terms, subject only to applicable
bankruptcy, insolvency, reorganization and moratorium Laws and other Laws of general




34









 




application
affecting enforcement of creditors’ rights generally. Except for the Intellectual Property used by
Seller to provide services pursuant to the Transition Services Agreement, the Intellectual Property
licensed to Buyer pursuant to the Intellectual Property License Agreement and the Purchased
Intellectual Property, together with any Licensed Intellectual Property and the other rights
granted to Buyer under the Transaction Documents, includes all of the material Intellectual
Property necessary to the conduct of the Business as currently conducted by Seller. None of
Section 4.10(b) is intended to address infringement or misappropriation of Intellectual
Property of any Person because those issues are addressed exclusively in Section 4.10(c).




          (c) To the Knowledge of Seller in each case (i) Seller has not, in the operation of the
Business, in any material respect infringed, misappropriated or otherwise made any unlawful or
unauthorized use of any Intellectual Property of any Person, (ii) the operation of the Business as
currently conducted does not, in any material respect infringe, misappropriate or otherwise make
any unlawful or unauthorized use of any Intellectual Property of any Person, and (iii) the products
sold and services performed by Seller in connection with the Business do not, and the manufacture,
use, or sale of such products or performance of such services does not, in any material respect
infringe, misappropriate or otherwise make any unlawful or unauthorized use of any Intellectual
Property of any Person. To the Knowledge of Seller, Seller has not, as of the date of this
Agreement or in the past five (5) years immediately preceding the date of this Agreement, received
any written notices or other communications claiming, alleging or suggesting infringement,
misappropriation or other unlawful or unauthorized usage of any Intellectual Property of any Person
with respect to the Business (including any demands or offers to license any Intellectual Property
from any Person). The Parties agree that Seller shall have no
liability for breaches of the two preceding sentences to the extent any infringement,
misappropriation or unlawful use of any Intellectual Property of any Person would not have occurred
if Seller had signed Contracts noted as unsigned on Schedule 2.2(a)(i). To Seller’s
Knowledge, no other Person is infringing, misappropriating or otherwise making any unlawful or
unauthorized use of any Licensed Intellectual Property for which Seller has the right to enforce or
any Purchased Intellectual Property.




          (d) Seller has used commercially reasonable efforts to protect the confidentiality of any
Purchased Intellectual Property of a confidential nature (including Trade Secrets and source code).
Without limiting the generality of the foregoing, Seller has, and uses commercially reasonable
efforts to enforce, a policy requiring, each (i) employee, individual consultant and individual
contractor involved in design or development relating to the 787 Program to execute a written
agreement protecting the confidentiality of any information of a confidential nature and requiring
such Person to assign all Intellectual Property related to the Business to Seller
(“Confidentiality and Assignment Agreements”) (the forms of which are set forth on
Schedule 4.10(d)), and (ii) employee, individual consultant of Seller working onsite at
Seller’s facility and individual contractor of Seller working onsite at Seller’s facility that has
access to material confidential information relating to the 787 Program to execute a
Confidentiality and Assignment Agreement. Without limiting the generality of the foregoing, to the
Knowledge of Seller, except as set forth on Schedule 4.10(d), (A) all current and former
employees, individual consultants and individual contractors of Seller involved in design or
development relating to the 787 Program have executed agreements substantially the same in
substance as the Confidentiality and Assignment Agreements and (B) all current and former employees
of Seller, individual consultants of Seller working onsite at Seller’s facility and




35









 




individual
contractors of Seller working onsite at Seller’s facility that have access to material confidential
information relating to the 787 Program have executed agreements substantially the same in
substance as the Confidentiality and Assignment Agreements. None of the Purchased Intellectual
Property has been adjudged invalid or unenforceable, and to the Knowledge of Seller, all of the
Purchased Intellectual Property that is referred to in Section 4.10(a)(i) is valid,
enforceable and subsisting. Seller has not, as of the date of this Agreement or during the
five-year period immediately preceding the date of this Agreement, received any written notice or
other written communication claiming, alleging or suggesting that any of the Purchased Intellectual
Property is invalid or unenforceable.




          (e) Except as set forth on Schedule 4.10(e), none of the Software included in the
Purchased Intellectual Property incorporates or links to any Open Source Software.




          (f) Seller has all material information technology systems sufficient to operate the Business
as it is currently conducted.




     Section 4.11 Contracts.



          (a) For purposes of this Agreement, each of the following shall constitute a “Material
Contract”:




               (i) each Purchased Contract relating to the employment (whether on a full-time, part-time,
consulting or other basis) of any Employee of the Business, and any “stay pay,” termination, change
of control or other Contract pursuant to which Seller is or may become obligated to make any
severance, termination or relocation payment to any current or former Employee of the Business who
earns or earned an annual base salary of more than $60,000 or for which the cost of such severance,
termination or relocation payment would exceed $30,000;



               (ii) except to the extent included elsewhere in this Section 4.11(a), each Purchased
Contract relating in a material manner or primarily to the acquisition, use, transfer, development,
ownership, sharing or license of any Intellectual Property material to the conduct of the Business
(other than nondisclosure agreements);



               (iii) each Purchased Contract creating or relating to any partnership, limited liability
company or joint venture or similar venture or arrangement;



               (iv) each Purchased Contract with any customer or production supplier that involves, or would
reasonably be expected to involve (assuming delivery of eighty-four (84) shipsets per year), the
payment or expenditure in excess of $2,000,000;



               (v) each Purchased Contract not with customers or production suppliers that may not be
terminated (without penalty) by Seller within thirty (30) days after the delivery of a termination
notice by Seller and contemplating or involving, or reasonably anticipated to involve, (A) the
payment or delivery by or to the Business of cash or other consideration in an amount or having a
value in excess of $250,000 in the aggregate in any calendar year; (B) the performance by or for
the Business of services in an amount or having a value in excess of $250,000 in the aggregate in
any calendar year; or (C) the sale, lease or other



36









 







disposition by or to the Business of goods,
supplies, products and/or other Assets in an amount or having a value in excess of $250,000 in the
aggregate in any calendar year;



               (vi) each Seller Contract imposing any material, explicit restriction on the right or ability
of (A) the Business to (1) compete with, or solicit the services or employment of, any other
Person; (2) sell any product or other Asset, or perform any services anywhere in the world;
(3) acquire any product or other Asset or any services from any other Person, sell any product or
other Asset to or perform any services for any other Person, or transact business with any other
Person; or (4) develop, use, sell, enforce or license any Intellectual Property material to the
Business (other than nondisclosure agreements); or (B) Buyer to own and operate the 787 Program as
currently conducted;



               (vii) each Purchased Contract under which Seller (A) leases or subleases any real property or
(B) leases or subleases any buildings, structures, improvements or appurtenances, in whole or in
part, from any other Person involving lease payments or other consideration in excess of $100,000
per annum;



               (viii) each Purchased Contract with (A) any Affiliate of Seller (other than any employee of
Seller) or (B) any of the Persons identified on Schedule 4.11(a)(viii);



               (ix) each note, debenture, bond, indenture, guarantee, loan, credit or financing agreement,
instrument or other evidence of, or Contract for, Indebtedness of Seller
secured by or providing Encumbrances on the Purchased Assets, and each Purchased Contract for
borrowed money (including for future loans, credit or financing);



               (x) any Contract, the primary subject matter of which is confidentiality, nondisclosure or
similar agreement with respect to confidentiality arrangements executed by or on behalf of Seller
with respect to the Business pursuant to which any third party owes an obligation of
confidentiality to Seller in relation to the Business;



               (xi) each Purchased Contract which creates, or may create, an Encumbrance on any Purchased
Asset in an amount or with a value in excess of $50,000; and



               (xii) each Purchased Contract set forth on Schedule 4.11(a)(xii).



          (b) Except as set forth on Schedule 4.11(b) and other than with respect to the 787
Supply Agreement: (i) each Material Contract is in full force and effect and (ii) each Material
Contract constitutes a legal, valid, binding and enforceable obligation of Seller and, to Seller’s
Knowledge, of the other party or parties thereto and is enforceable in accordance with its terms,
subject only to applicable bankruptcy, insolvency, reorganization and moratorium Laws and other
Laws of general application affecting enforcement of creditors’ rights generally.




          (c) Except as set forth on Schedule 4.11(c) and other than with respect to the 787
Supply Agreement: (i) Seller has not violated or breached in any material respect or committed any
material default under, any Material Contract (in each case, with or without notice or lapse of
time or both), nor is it in receipt of any written Claim of such default or breach; and (ii) to the
Knowledge of Seller, no other Person has violated or breached in any
material respect, or committed
any material default under, any Material Contract (in each case, with or without notice or lapse of
time or both).





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          (d) Other than under the 787 Supply Agreement, no event or development has occurred, and no
fact, circumstance or condition exists, that (with or without notice or lapse of time or both) has
(i) resulted in a material violation or breach of any provision of any Material Contract by Seller;
(ii) given any Person the right to declare a material default or exercise any remedy for breach
under any Material Contract; (iii) given any Person the unilateral right to accelerate the maturity
of material obligations pursuant to any Material Contract; or (iv) give any Person the right to
cancel, terminate or modify, in any material respect, any Material Contract.




          (e) Schedule 4.11(e) provides a list of all written Material Contracts (including all
amendments thereto and excluding purchase orders issued pursuant to Material Contracts otherwise
disclosed on such schedule) and a summary description of all material terms of any oral or
unwritten Contract constituting a Material Contract (including any oral or unwritten amendments
thereto), in each case as of the date of this Agreement. A true, correct and complete copy of each
such written Material Contract (including all amendments thereto) has been made available to Buyer.




     Section 4.12 Litigation.



          (a) As of the date of this Agreement, (i) there is not pending or, to Seller’s Knowledge,
threatened in writing against Seller or the Business any Legal Proceeding (other than any
investigation by any Governmental Authority) at law or in equity before any court, tribunal,
governmental body, agency or official or any arbitrator relating to the Business or the Purchased
Assets (including any such Legal Proceeding which would affect the North Charleston Real Property
or Seller’s right to occupy or utilize all or any portion of the North Charleston Real Property in
accordance with the North Charleston Sublease, including any such proceeding under or in connection
with the exercise or threat of exercise of eminent domain power), and (ii) to the Knowledge of
Seller, there is no pending or threatened investigation of Seller by any Governmental Authority
relating to the Business, in each case that would reasonably be expected to affect the legality,
validity or enforceability against Seller of this Agreement or Seller’s ability to perform its
obligations hereunder, or that is reasonably likely to result in Losses in excess of $50,000. As
of the date of this Agreement, there is no Legal Proceeding pending or, to Seller’s Knowledge,
threatened orally or in writing against Seller that would, if adversely determined, reasonably be
expected to prevent or materially delay consummation of the transactions contemplated hereby.




          (b) As of the date of this Agreement, (i) there is no Legal Proceeding, formal Claim or formal
written ethics complaint pending or, to Seller’s Knowledge, threatened in writing against the
Business, or for which the Business is obligated to indemnify a third party pursuant to a written
agreement; and (ii) neither the Business nor the Purchased Assets is subject to any outstanding
Order, other than, for the purposes of clauses (i) and (ii) of this sentence, any matter in which
the Losses asserted or for which the amount in question does not exceed $50,000. As of the date of
this Agreement, there are no formal internal investigations or inquiries related to the Business
being conducted (a) by Seller’s board of directors (or any committee thereof) or (b) by the
Business (or by Seller on behalf of the Business) or any third




38









 




party at the request of the Business
(or by Seller on behalf of the Business) for which Seller has engaged outside legal counsel or
other outside advisors or consultants concerning financial, accounting, Tax, Income Tax, material
violation of Law or fraudulent conduct.




     Section 4.13 Permits; Compliance with Laws.



          (a) Schedule 4.13 sets forth a list of all material Governmental Authorizations of
Seller used in or held for use by Seller in connection with the Business and all pending
applications therefor or renewals thereof as of the date of this Agreement. Seller is in
possession of all material Governmental Authorizations, and has made all material filings,
applications and registrations with any Governmental Entity, in each case that are necessary for
Seller to own, lease, use and/or operate the Purchased Assets, in order to carry on the Business
substantially as it is being conducted as of the date hereof, and all such Government
Authorizations are, in all material respects, valid and in full force and effect.




          (b) Seller is not in material conflict with, or in material default or violation of, (i) any
Law applicable to the Business or by which any Purchased Asset is bound or (ii) any Governmental
Authorization. Except as necessary to transfer Permits because of a change of ownership, none of
the Transferred Permits will become terminable, in whole or in part, as a
result of the transactions contemplated by this Agreement, except as would not, individually
or in the aggregate, have a Material Adverse Effect. During the two (2) year period immediately
preceding the date of this Agreement, Seller has not received any written warning, notice of
violation, notice of revocation or other written communication from or on behalf of any
Governmental Entity, alleging (A) any material violation of any Governmental Authorization (other
than violations that have been remedied and with respect to which, to the Knowledge of Seller, no
Person, as of the date of this Agreement, has a right of action against Seller) or (B) that Seller
requires any material Governmental Authorization for the Business as currently conducted that is
not currently held by it. As of the date of this Agreement, to the Knowledge of Seller, no
investigation or inquiry by any Governmental Entity with respect to the Business is pending or
threatened, in each case with respect to any alleged or claimed violation of Law applicable to the
Business or by which any material Purchased Asset is bound or affected.




          (c) Seller and, to Seller’s Knowledge, managers, officers, employees, Affiliates and
authorized agents of the Business and any other Person associated with or acting on behalf of
Seller with respect to the Business, in each case, relating to conduct or actions taken on behalf
of the Business, are in material compliance with all applicable legal requirements under (i) the
Foreign Corrupt Practices Act (15 U.S.C. §§ 78dd-1, et seq.) and (ii) all international
anti-bribery and other Laws applicable to the Business relating to corruption, bribery, ethical
business conduct, money laundering, political contributions, gifts and gratuities to public
officials and private persons, and Laws requiring the disclosure of agency relationships or
commissions and the anticorruption rules of any international financial institutions with which it
does business (collectively, the “Anti-Bribery Laws”). During the two (2) year period
prior to the date of this Agreement, Seller has not received any written communication from any
Governmental Entity that alleges that Seller, any manager, officer, employee, Affiliate or
authorized agents of the Business or any other Person acting on behalf of Seller with respect to
the Business is, or may be, in violation of, or has, or may have, any material Liability under, the
Anti-Bribery Laws.




39









 








          (d) Seller is not a “Specially Designated National” or other “Blocked Person” identified by
the United States government, nor a Person that is owned or controlled by or acts on behalf of a
“Specially Designated National” or “Blocked Person.” To Seller’s Knowledge, none of Seller’s
brokers or any manager, officer, employee or authorized agent of the Business, and none of the
funds or other assets to be transferred hereunder are the property of, or beneficially owned,
directly or indirectly, by any “Specially Designated National” or “Blocked Person,” nor, to the
Knowledge of Seller, are such funds or other assets the proceeds of any specified unlawful activity
as defined by 18 U.S.C. § 1956(c)(7). With respect to the Business, Seller has not engaged in or,
to Seller’s Knowledge, facilitated any prohibited transactions in violation of any Law with any
“Specially Designated National” or other “Blocked Person” without proper prior authorization from
the United States government.




          (e) The representations and warranties set forth in this Section 4.13 do not apply to
matters that are the subject of Employee Benefit Plans and Employment Matters (which are addressed
in Section 4.16).




          (f) If any matter is addressed in both Section 4.10(c) and Section 4.13, then
the knowledge qualifiers contained in Section 4.10(c) shall qualify the relevant provisions
of Section 4.13 to the same extent as qualified in Section 4.10(c).




     Section 4.14 Environmental, Health and Safety Laws. Except for those matters that
would not reasonably be expected to have, individually or in the aggregate, a Material Adverse
Effect:



          (a) Except as set forth on Schedule 4.14(a), the North Charleston Real Property and
the p Purchased Assets (including the North Charleston Facility) have not been used during
the period of Seller’s ownership, lease, occupancy or operation for landfill, dumping or other
on-site waste disposal activities, or operations, or for the on-site sale, treatment, processing,
recycling or disposal of any Hazardous Material.




          (b) To Seller’s Knowledge, except as set forth on Schedule 4.14(b), there are no
underground storage tanks, sumps or wells on, in, or incorporated into the North Charleston Real
Property or the tangible Purchased Assets (including the North Charleston Facility).




          (c) Except as set forth on Schedule 4.14(c), Seller and its use and operation of the
North Charleston Real Property and the tangible Purchased Assets (including the North Charleston
Facility) comply, in all material respects, with, and have at all times during the period of their
occupancy and use of the North Charleston Real Property and the tangible Purchased Assets
(including the North Charleston Facility) complied, in all material respects, with, all
Environmental Laws and no Liability has arisen under Environmental Laws related to Seller or its
use or operation of the North Charleston Real Property or the tangible Purchased Assets (including
the North Charleston Facility).




          (d) All material Governmental Authorizations required by or issued pursuant to any
Environmental Law (collectively, the “Environmental Permits”) for the ownership, use or
operation of the North Charleston Real Property or the tangible Purchased Assets (including the
North Charleston Facility) of the Business are presently maintained in full force and effect.




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Schedule 4.14(d) contains a true and complete listing of all material Environmental Permits
and environmental disclosure reports held or made by Seller with respect to the North Charleston
Real Property or the tangible Purchased Assets (including the North Charleston Facility). Except
as set forth on Schedule 4.14(d), the Business and Seller’s use and operation of the North
Charleston Real Property and the tangible Purchased Assets (including the North Charleston
Facility) comply, in all material respects, with, and during the last two (2) years have at all
times complied, in all material respects, with, all Environmental Permits.




          (e) Except as set forth on Schedule 4.14(e), excluding permitted or authorized
Releases arising during the ordinary course of business consistent with past practice, to Seller’s
Knowledge there neither is, nor has been, any Release or threatened Release of Hazardous Material
from, in, on, or to the North Charleston Real Property or the tangible Purchased Assets (including
the North Charleston Facility).




          (f) Except as set forth on Schedule 4.14(a), to Seller’s Knowledge there are no
Hazardous Materials emanating from the North Charleston Real Property or the tangible
Purchased Assets (including the North Charleston Facility) as of the date of this Agreement
exceeding applicable regulatory thresholds.




          (g) During the last two (2) years, Seller has not received written notice of any material
Environmental Claim related to the North Charleston Real Property or the tangible Purchased Assets
(including the North Charleston Facility). With the exception of items listed in
Schedule 4.14(g), during the last two (2) years, Seller has not received written notice of
any pending or threatened investigation or inquiry concerning: (i) the presence or release of any
Hazardous Material on, in, incorporated into, emanating from or otherwise associated with the North
Charleston Real Property or the tangible Purchased Assets (including the North Charleston
Facility), or associated with the transport, treatment, storage, recycling or disposal of Hazardous
Materials generated at the North Charleston Real Property or the tangible Purchased Assets
(including the North Charleston Facility) to or at any off-site location, or (ii) any alleged
violation of or any alleged Liability under any Environmental Law arising out of or in any way
connected with operations or activities at the North Charleston Real Property or the tangible
Purchased Assets (including the North Charleston Facility), or the transport, treatment, storage,
recycling or disposal of Hazardous Materials generated at the North Charleston Real Property or the
tangible Purchased Assets (including the North Charleston Facility) to or at any off-site location.
Except as specifically disclosed in the environmental disclosure documents listed in
Schedule 4.14(g), Seller has no Knowledge of any facts or circumstances concerning any
alleged violation or Liability arising under or related to any Environmental Law which would
reasonably be expected to result in an Environmental Claim against the owner of the North
Charleston Real Property or the tangible Purchased Assets (including the North Charleston
Facility).




          (h) Except as set forth on Schedule 4.14(h), to the Knowledge of Seller, except for
land use zoning and Federal Aviation requirements on height and non-interference with the adjoining
regional aviation activities or for Permitted Encumbrances, no action has been taken by any
Governmental Entity pursuant to the provisions of any Environmental Law specifically to restrict
the use of the North Charleston Real Property or the tangible Purchased Assets (including the North
Charleston Facility).





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          (i) Seller has made available to Buyer all non-privileged documents, correspondence,
pleadings, reports, assessments, analytical results and Environmental Permits concerning
Environmental Laws, Hazardous Materials, or other environmental subjects that affect the North
Charleston Real Property, the tangible Purchased Assets (including the North Charleston Facility),
the Assumed Liabilities or the Business in Seller’s possession or control.




     Section 4.15 Tax Matters.



          (a) Except with respect to the 2008 Income Tax Returns, Seller has filed all Tax Returns and
Income Tax Returns required to be filed under applicable Laws with respect to Taxes and Income
Taxes, the nonpayment of which could result in an Encumbrance on the Purchased Assets. All such
returns were correct and complete in all material respects and have been prepared in all material
respects in compliance with all applicable Laws insofar as such Tax Returns and Income Tax Returns
relate to Taxes and Income Taxes, the nonpayment of which
could result in an Encumbrance on the Purchased Assets. All Taxes and Income Taxes due and
owing by Seller (whether or not shown on any Tax Return or Income Tax Return), the nonpayment of
which could result in an Encumbrance on the Purchased Assets, have been timely paid, except as set
forth on Schedule 4.15.




          (b) Seller has withheld and timely paid all material Taxes (including sales and use Taxes) and
Income Taxes required to have been withheld and paid in connection with any amounts paid or owing
to any employee, independent contractor, creditor, equity holder, or other Person or third party
with respect to the Business or the Purchased Assets, except as set forth on Schedule 4.15.




          (c) Except with respect to the 2008 Income Tax Returns, Seller is not currently the
beneficiary of any extension of time within which to file any Tax Return in connection with or
relating to the Business and the Purchased Assets.




          (d) There are no Encumbrances for Taxes or Income Taxes (other than such taxes that are not
yet due and payable or that are being contested in good faith through appropriate proceedings) upon
any of the Purchased Assets. All Taxes or Income Taxes with respect to the Business or the
Purchased Assets that are being contested are set forth on Schedule 4.15.




          (e) No foreign, federal, state, or local Tax audits or administrative or judicial Tax or
Income Tax proceedings have been threatened (in writing) or, to Seller’s Knowledge, are pending or
being conducted with respect to Taxes of Seller, the nonpayment of which could result in an
Encumbrance on the Purchased Assets. Seller has not received from any foreign, federal, state, or
local Tax Authority (including jurisdictions where Seller has not filed Tax Returns or Income Tax
Returns) any notice of deficiency or proposed adjustment for any amount of Tax or Income Tax
proposed, asserted or assessed by any Tax Authority against Seller, the nonpayment of which could
result in an Encumbrance on the Purchased Assets.




          (f) Seller is a “United States person” within the meaning of the Code.




          (g) Seller does not treat any of the Purchased Contracts that are being transferred (or
assumed) by Buyer pursuant to this Agreement as a partnership for
Income Tax purposes.
Schedule 4.15(g) sets forth all partnership interests for U.S. federal income tax purposes
that are Purchased Assets.





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          (h) Notwithstanding the foregoing, no representation or warranty in this Section 4.15
is given or shall be deemed to relate or pertain to the Assumed Liabilities in Section
2.3(a)(iii) hereof.




     Section 4.16 Employee Benefit Plans; Employment Matters.



          (a) Schedule 4.16(a) lists as of the date of this Agreement, with respect to the
Employees, (i) all employee benefit plans within the meaning of Section 3(3) of ERISA, (ii) each
loan from Seller or any Subsidiary of Seller to an Employee, (iii) all stock option, stock
purchase, phantom stock, stock appreciation right, stock-based compensation, supplemental
retirement, severance, sabbatical, employee relocation, cafeteria benefit (Section 125 of the
Code), dependent care (Section 129 of the Code), life insurance or accident insurance plans,
programs or arrangements, (iv) all bonus or incentive, pension, profit sharing, savings,
retirement, or deferred compensation plans, programs and arrangements, (v) other fringe and
employee benefit plans, programs or arrangements that apply to senior management and that do not
generally apply to all employees, and (vi) any employment or service agreements (excluding any
offer letters other than those providing severance pay, acceleration or post-termination benefits
or bonus arrangements other than those set forth in Schedule 4.16(m)) or severance
agreements for the benefit of, or relating to, any present or former director, officer, employee,
or consultant under which any of Seller or any Subsidiary of Seller could reasonably be expected to
have any Liability or obligation (all of the foregoing described in clauses (i) through (vi)
collectively, the “Employee Benefit Plans”).




          (b) Prior to the date of this Agreement, Seller has provided or made available to Buyer, a
correct and complete copy of each of the Employee Benefit Plans and any related plan documents
(including any material employee communications of Seller relating to the Employee Benefit Plans
that have been distributed since January 1, 2007 (or since January 1, 2008 with respect to any
defined benefit pension plan), summary plan descriptions and summaries of material modifications)
and has provided or made available to Buyer correct and complete copies of the most recent Form
5500 reports (other than with respect to any defined benefit pension plan). Any Employee Benefit
Plan intended to be qualified under Section 401(a) of the Code that includes a qualified cash or
deferred arrangement (each a “401(k) Plan”) (i) has obtained from the IRS a current
favorable determination letter issued to Seller as to its qualified status under the Code, (ii) has
been established under a standardized master and prototype or volume submitter plan for which a
current favorable IRS advisory letter or opinion letter has been obtained by the plan sponsor and
is valid as to the adopting employer, or (iii) has time remaining under applicable Laws to apply
for a determination or opinion letter or to make any amendments necessary to obtain a favorable
determination or opinion letter. Seller has also provided to Buyer a correct and complete copy of
the most recent IRS determination letter, advisory letter or opinion letter issued with respect to
each 401(k) Plan. To Seller’s Knowledge nothing has occurred since the issuance of each such
letter that could reasonably be expected to cause the loss of the Tax-qualified status of any
401(k) Plan subject to Section 401(a) of the Code or an applicable trust under Section 501(a) of
the Code.




43









 








          (c) Except as set forth on Schedule 4.16(c), none of the Employee Benefit Plans
promises or provides retiree medical or other retiree welfare benefits to any Person other than as
required under the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended
(“COBRA”) or applicable state law.




          (d) Except as set forth in Schedule 4.16(d), neither Seller nor any ERISA Affiliate
sponsors, maintains, participates in, contributes to, or is required to participate in or
contribute to a pension plan (within the meaning of Section 3(2) of ERISA) for the benefit of
Employees that is subject to Title IV or Part 3 of Title 1 of ERISA or Section 412 of the Code. In
connection with the Business, neither Seller nor any ERISA Affiliate is a party to, or has made any
contribution to or otherwise incurred any obligation under, any “multiemployer plan” as such term
is defined in Section 3(37) of ERISA (a “Multiemployer Plan”) or any “multiple
employer plan” as such term is defined in Section 413(c) of the Code to which Seller has any
Liability (contingent or otherwise).




          (e) No payment or benefit which will or may be made by Seller or any Subsidiary of Seller as a
result of or in connection with the consummation of the transactions contemplated by this Agreement
with respect to any Employee who is a “disqualified individual” (as such term is defined in
Treasury Regulation Section 1.280G-I) could reasonably be expected to constitute an “excess
parachute payment” (as defined in Section 280G(b)(1) of the Code).




          (f) Schedule 4.16(f) identifies, as of the date of this Agreement, the Employees who
are absent from active work because of disability or other leave, the nature of such leave (e.g.,
short-term or long-term disability), and the expected length of the leave.




          (g) Each material Employee Benefit Plan that is a nonqualified deferred compensation plan
subject to Section 409A of the Code has been operated and administered in good faith material
compliance with Section 409A of the Code from the period beginning January 1, 2005 through the date
hereof.




          (h) In connection with the Business, Seller is in compliance in all material respects with all
currently applicable Laws respecting employment, discrimination in employment, terms and conditions
of employment, worker classification (including the proper classification of workers as independent
contractors and consultants), wages, hours and withholding of Income Taxes and employment Taxes
(including unemployment and social security obligations), including the Fair Labor Standards Act
and the Immigration Reform and Control Act. There are no controversies pending or, to Seller’s
Knowledge, threatened, between Seller and any Employees, which controversies have or could
reasonably be expected to result in a Legal Proceeding or Claim before any Governmental Entity.




          (i) Except as disclosed on Schedule 4.16(i), Seller is not a party to or bound by any
Collective Bargaining Agreement or other labor union Contract covering any Employees, and no
Collective Bargaining Agreement covering any Employees is being negotiated by Seller. There is no
pending demand for recognition or any other request or demand from a labor organization for
representative status with respect to any Employees. To Seller’s Knowledge, there are no
activities or proceedings of any labor union to organize the Employees. There is no labor dispute,
strike or group work stoppage against Seller pending or to Seller’s Knowledge




44









 




threatened that would
materially interfere with the Business. Neither Seller nor to Seller’s Knowledge, any of Seller’s
Employees has been found by the National Labor Relations Board or any comparable Governmental
Entity in the past two (2) years to have committed an unfair labor practice in connection with the
operation of the Business. To Seller’s Knowledge, there is no charge or complaint against Seller
by the National Labor Relations Board or any comparable Governmental Entity pending or threatened
in connection with the Business.




          (j) Schedule 8.1(a)(i) contains a listing, of all Employees, including their job
titles and whether Seller treats the Employees as exempt or non-exempt under the Fair Labor
Standards Act. To Seller’s Knowledge, no Employee is in material violation of any term of any
employment agreement, patent disclosure agreement, non-competition agreement, or any restrictive
covenant to a former employer relating to the right of any such Employee to be
employed by Seller because of the nature of the business conducted or presently proposed to be
conducted by Seller or to the use of Intellectual Property of others. No officer or manager who is
an Employee has given notice of termination or resignation to Seller, nor does Seller otherwise
have Knowledge that any such officer or manager intends to terminate his or her employment with
Seller. Schedule 8.1(a)(i) contains the current base salary or wage rate and the bonus
earned in 2008 by all Employees. To Seller’s Knowledge, the employment of each of the Employees is
on an “at will” basis, and except as set forth in Schedule 4.16(a), Seller has not
knowingly entered into any agreement that would negate “at will” employment or require any
particular form or period of notice prior to terminating the employment of any such Employees,
except as may be required by applicable Law.




          (k) Seller has made available to Buyer a summary or copy of Seller’s standard severance
policy, if any.




          (l) With respect to the Business, Seller is in compliance in all material respects with the
WARN Act, and all similar state or local Laws. Seller has not caused any Employees to suffer an
“employment loss” (as defined in the WARN Act) during the 90-day period prior to the date of this
Agreement.




          (m) Schedule 4.16(m) identifies each Employee that is entitled to participate in
Seller’s “Management Incentive Plan,” Seller’s “Gaining Ground” program or an enhanced version of
Seller’s “Gaining Ground” program and identifies the applicable plan or program and the applicable
bonus target percentages, if any, for each such Employee.




     Section 4.17 Suppliers. Schedule 4.17 sets forth (i) a complete and correct
list of the twenty (20) largest suppliers (each measured by Dollar volume of revenue) of the
Business during the last completed fiscal year and the current year-to-date period ended April 30,
2009, (ii) the amount of such business done (by Dollar volume of revenue) with each such supplier
during such periods and (iii) a complete and correct list of all material written Claims made by
each such supplier since January 1, 2007 alleging breach of, or entitlement to a price adjustment
or other additional consideration pursuant to, the applicable Seller Supply Agreement.



     Section 4.18 Insurance. As of the date of this Agreement, Seller currently maintains
or is provided the insurance coverage related to the Business and the Purchased Assets listed in
Schedule 4.18. As of the date of this Agreement, to Seller’s Knowledge, all such policies
are



45









 




valid and effective. As of the date of this Agreement, there is no Claim pending under any
such policies, or any circumstance where coverage has been questioned, denied or disputed by the
underwriters of such policies. As of the date of this Agreement, all premiums due and payable
under all such policies have been paid, Seller is in material compliance with all disclosure
obligations thereunder the absence of which could be reasonably expected to result in a denial of
coverage, and Seller is otherwise in material compliance in all respects with the terms of such
policies. As of the date of this Agreement, Seller has not been notified in writing of any
threatened termination of, other than in
connection with ordinary renewal notices, or material premium increase with respect to, any
such policies of insurance maintained by Seller.




     Section 4.19 Certain Transactions. Schedule 4.19 sets forth a description of
all agreements and arrangements relating to the Business or included in the Purchased Assets
between Seller, on the one hand, and any of Seller’s Affiliates involved in the Business or,
officers or employees of the Business, on the other hand (other than employment agreements between
Seller and employees of the Business).



     Section 4.20 Broker’s Fees. Except as set forth on Schedule 4.20, Seller has
no Liability or obligation to pay any fees or commissions to any broker, finder or similar agent in
connection with the transactions contemplated by this Agreement or any other Transaction Document.



     Section 4.21 Security Clearance. Except as may be prohibited by the National
Industrial Security Program Operating Manual, Schedule 4.21 sets forth all facility and
personnel security clearances held by Seller related to the Business or the Purchased Assets as of
the date of this Agreement. Except as set forth in Schedule 4.21, to Seller’s Knowledge,
there is no proposed or threatened termination or invalidation of any facility or personnel
security clearances held by Seller related to the Business or the Assets as of the date of this
Agreement.



     Section 4.22 Site Development and Incentive Agreement; FILOT Agreement.



          (a) As of December 31, 2008, (i) Seller has 329 employees that are counted as employees for
purposes of meeting the minimum employment level, subject to the wage and fringe benefit
requirements, all as identified in Exhibit B to the Site Development and Incentive Agreement, and
68 of such employees that are considered as “Badged Personnel” pursuant to Section 6.1 of the Site
Development and Incentive Agreement and (ii) Seller has expended $237,769,169 in “Investment” as
defined in Section 11-41-30(4) of the South Carolina Code, as amended.




          (b) As of March 29, 2009, (i) Seller has 536 employees that are counted as employees for
purposes of meeting the minimum employment level, subject to the wage and fringe benefit
requirements, all as identified in Exhibit B to the Site Development and Incentive Agreement, and
62 of such employees that are considered as “Badged Personnel” pursuant to Section 6.1 of the Site
Development and Incentive Agreement and (ii) Seller has expended $238,168,845 in “Investment” as
defined in Section 11-41-30(4) of the South Carolina Code, as amended.




46









 








          (c) As of March 29, 2009, Seller has acquired $213,749,228 of “Economic Development Property”
as defined in the FILOT Agreement.




ARTICLE V




REPRESENTATIONS AND WARRANTIES OF BUYER




     Buyer hereby represents and warrants to Seller as follows:



     Section 5.1 Organization and Qualification. Buyer is a corporation duly organized,
validly existing and in good standing under the Laws of the State of Delaware.



     Section 5.2 Authority; Enforceability. Buyer has the requisite corporate power and
authority to enter into, execute and deliver this Agreement and each other Transaction Document to
which it is a party, to perform all of the obligations to be performed by it hereunder and
thereunder and to consummate the transactions contemplated hereby and thereby. The execution and
delivery by Buyer of this Agreement and each other Transaction Document to which it is a party, the
performance of its obligations hereunder and thereunder and the consummation by Buyer of the
transactions contemplated hereby and thereby have been duly authorized by all necessary corporate
action, and no other corporate action or proceeding is necessary to authorize the execution and
delivery of this Agreement and each other Transaction Document to which Buyer is a party, the
performance of its obligations hereunder and thereunder or the consummation of the transactions
contemplated hereby and thereby. This Agreement has been, and each of the other Transaction
Documents to which it is party will have been at the Closing, duly authorized, executed and
delivered by Buyer and, assuming due authorization, execution and delivery by Seller, this
Agreement constitutes, and each of the documents contemplated hereby will constitute at the
Closing, its valid and binding obligation, enforceable against it in accordance with its respective
terms, subject only to (a) applicable bankruptcy, insolvency, reorganization and moratorium Laws
and other Laws of general application affecting enforcement of creditors’ rights generally and
(b) rules or Laws governing specific performance, injunctive relief and other equitable remedies.



     Section 5.3 No Conflicts.



          (a) The execution and delivery by Buyer of this Agreement and each of the other Transaction
Documents to which it is a party, the performance of and compliance with the respective terms and
provisions hereof and thereof and the consummation by Buyer of the transactions contemplated hereby
and thereby, do not and will not: (i) conflict with, or violate any provision of the certificate
of incorporation, by-laws or any other organizational or governance document of Buyer; or (ii)
subject to obtaining the Governmental Authorizations set forth on Schedule 5.3, conflict
with or violate any Law.




          (b) Except as set forth on Schedule 5.3, the execution and delivery by Buyer of this
Agreement and each of the other Transaction Documents to which it is a party, the performance of
and compliance with the respective terms and provisions hereof and thereof, and the consummation by
Buyer of the transactions contemplated hereby and thereby, do not and
will not require any Consent or Governmental Authorization from, or filing with or notification to,
any Person not a party to this Agreement.





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     Section 5.4 Broker’s Fees. Except as set forth on Schedule 5.4, Buyer has no
Liability or obligation to pay any fees or commissions to any broker, finder or similar agent in
connection with the transactions contemplated by this Agreement or any other Transaction Document.



     Section 5.5 Litigation. No action, suit or proceeding is pending or threatened to
restrain, prohibit or otherwise challenge the enforceability, consummation, legality or validity of
this Agreement or any other Transaction Document or would reasonably be expected to affect Buyer’s
ability to perform its obligations hereunder, other than any Claim as would not, individually or in
the aggregate, have a material adverse effect on Buyer’s ability to consummate the transactions
contemplated hereby in accordance with the terms hereof and applicable Laws.



ARTICLE VI




COVENANTS




     Section 6.1 Appropriate Actions; Further Assurances. Upon the terms and subject to
the conditions set forth in this Agreement, Buyer and Seller shall each use all commercially
reasonable efforts to take, or cause to be taken, all actions, and do, or cause to be done, all
things necessary, proper or advisable under applicable Law or otherwise to consummate and make
effective the transactions contemplated by this Agreement as soon as practicable after the date
hereof; provided that nothing in this Section 6.1 shall require Buyer to waive any
of the conditions set forth in Section 9.1 or require Seller to waive any of the conditions
set forth in Section 9.2. Without limiting the generality of the foregoing, Seller shall
from time to time when reasonably requested by Buyer, whether at or after the Closing, and without
further consideration, promptly execute and deliver, or cause to be executed and delivered, all
such documents necessary to (i) vest in Buyer all right, title and interest in and to the Purchased
Assets, in accordance with this Agreement and (ii) perfect and record the sale of the Purchased
Assets to Buyer in accordance with the terms of this Agreement. If Seller determines within one
hundred eighty (180) days after the Closing that it has failed to deliver to Buyer any of the
Purchased Assets (including any Purchased Intellectual Property) in the possession of Seller,
Seller shall deliver such Asset(s) (or a copy of such Purchased Intellectual Property) promptly as
reasonably practicable to Buyer. If Buyer accurately determines within one hundred eighty (180)
days after the Closing that (x) any Assets of Seller in Seller’s possession were not delivered to
Buyer at Closing but should have been so delivered because such Assets fall within the definition
of “Purchased Assets,” then Buyer shall provide written notice to Seller and Seller shall deliver
such Asset(s) promptly as reasonably practicable to Buyer or (y) a copy of any Purchased
Intellectual Property in Seller’s possession was not delivered to Buyer at Closing, then Buyer
shall provide written notice to Seller and Seller shall deliver a copy of such Purchased
Intellectual Property promptly as reasonably practicable to
Buyer. The Parties hereby agree that any restrictions on Buyer contained in Contracts between
Seller and Buyer or any Affiliate of Buyer disclosed or required to be disclosed by Seller pursuant
to Section 4.11(a)(vi)(B) shall be of no further force or effect from and after the Closing
Date; provided that any Affiliate of Buyer that is a party thereto agrees to the
termination of such restrictions.



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     Section 6.2 Conduct of Business by Seller Until Closing.



          (a) From the date of this Agreement until the Closing, except with the prior written consent
of Buyer (which consent shall not be unreasonably withheld, conditioned or delayed), and except as
set forth on Schedule 6.2(a), Seller shall (i) conduct the Business and use and/or hold for
use the Purchased Assets only in the ordinary course of business, consistent with past practice;
(ii) use commercially reasonable efforts to (A) preserve intact the Business and the Purchased
Assets, (B) maintain and operate the tangible Purchased Assets in reasonable operating condition
and repair (after allowing for ordinary wear and tear), (C) keep available the services of the
present employees working for the Business (regardless of where located), (D) maintain in all
material respects the goodwill associated with the Business (subject to Buyer’s compliance with the
terms of the 787 Supply Agreement) and its existing relationships with the customers, suppliers and
distributors of the Business; and (E) keep in full force and effect all liability insurance and
bonds comparable in amount and scope of coverage to that currently maintained by Seller for the
Business, the Purchased Assets, or the Assumed Liabilities; (iii) use commercially reasonable
efforts to pay trade payables (other than trade payables being disputed by Seller in good faith) of
the Business in the ordinary course of business consistent with past practice (including with
respect to the timing of such payments); (iv) use commercially reasonable efforts to continue to
prosecute any pending patent applications included in the Purchased Intellectual Property; and (v)
to the extent that doing so does not hinder the timely prosecution of patent applications included
in the Purchased Intellectual Property, consult with Buyer on Seller’s responses to office actions
with respect to such patent applications and consider in good faith Buyer’s comments with respect
to such responses. In addition, between the date hereof and the Closing, Seller shall use
commercially reasonable efforts to arrange for all or substantially all hazardous waste stored in
the 90-day hazardous waste storage area at the North Charleston Facility as of the date that is
three (3) days prior to the Closing to be shipped off-site prior to the Closing.




          (b) Without limiting the generality of the foregoing, from the date of this Agreement until
the Closing, unless otherwise expressly required by this Agreement or with the prior written
consent of Buyer (which consent shall not be unreasonably withheld, conditioned or delayed), Seller
shall not, except as set forth on Schedule 6.2(b):




               (i) Except as required by Law, (A) increase the salary, wages or other compensation or fringe
benefits of any current Employee or officer of the Business; (B) grant or increase any severance or
termination pay (other than in accordance with Seller’s normal severance practices in effect on the
date of this Agreement) to, or enter into any severance Contract with, any Employee or officer of
the Business, or enter into any employment Contract with any Employee or officer of the Business;
(C) establish, adopt, enter into or amend any
Employee Benefit Plan or other arrangement applicable solely to the Business or, except
pursuant to an employee benefit plan generally applicable to employees of Seller, grant or increase
any benefit to an Employee (it being understood and agreed by the Parties that, except with respect
to matters set forth on Schedule 6.2(b), if Seller takes any of the foregoing actions
described in this clause (C) (whether or not with respect to an Employee Benefit Plan or
arrangement solely applicable to the Business), such actions shall not be taken into account in
determining an Employee’s terms and conditions of employment for purposes of Sections 8.2
and 8.3); or (D) except as set forth on Schedule 6.2(b)(i), hire, promote or
terminate any officer



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or supervisory or management level Employee of the Business, except in each
case as may be required to comply with applicable Law or an Employee Benefit Plan or Seller
Contract in existence as of the date hereof;




               (ii) with respect to the Business, the Purchased Assets or the Assumed Liabilities, make any
loan, advance or capital contribution to, or any investment in, or acquire, by merging or
consolidating with, by purchasing any of the Assets or securities of or by any other manner,
directly or indirectly, any business or any Person, or otherwise acquire any Assets other than in
the ordinary course of business consistent with past practice;



               (iii) sell, lease, license, exchange, mortgage, pledge, transfer, encumber or otherwise
dispose of any of the Purchased Assets or any interest therein, or permit any of the Purchased
Assets to be subject to or become subject to any Encumbrance, except for (A) sales of Inventory in
the ordinary course of business consistent with past practice and (B) Outstanding Encumbrances,
Permitted Encumbrances and Encumbrances under the Seller Supply Agreements;



               (iv) other than as required to perform under a Material Contract in existence as of the date
hereof, move any tangible Assets (other than those that are de minimis in the aggregate in monetary
value) or employees of the Business or transition any business activities (other than immaterial
business activities) utilized in satisfying its obligations under the 787 Supply Agreement from the
North Charleston Facility to any other location;



               (v) knowingly abandon any patent application included in the Purchased Intellectual Property;



               (vi) with respect to the Business, the Purchased Assets or the Assumed Liabilities, change any
accounting methods, practices, principles or policies, other than as required by applicable Law or
GAAP, or make or rescind any election relating to Taxes, settle or compromise any Legal Proceeding
or other controversy relating to Taxes that could reasonably be expected to result in an adverse
effect on Buyer or the Business after the Closing Date;



               (vii) with respect to the Business, the Purchased Assets or the Assumed Liabilities, make or
agree to make any capital expenditures (other than as required pursuant to any Contract in
existence on the date hereof or executed hereafter in accordance with Section 6.2(b)(viii)
of this Agreement) in an amount exceeding the amount provided in the Business’s 2009 Capital Asset
Plan set forth on Schedule 6.2(b)(vii);



               (viii) except as otherwise prohibited by this Section 6.2(b), enter into any Contract
(A) that would be deemed to be a Material Contract if such Contract had existed on the date hereof,
other than (1) purchase orders pursuant to an existing Contract that are subject to customary terms
and conditions (which include the applicable existing Contract), which, in the case of Contracts
with production suppliers, would not commit the Business with respect to more than thirty (30)
shipsets in the aggregate (measured since inception of such Contract), or (2) in the case of
Contracts not with production suppliers, any Contract entered into in the ordinary course of
business consistent with past practice and customary terms and conditions (which include the
applicable existing Contract) that does not involve an amount in excess of $250,000



50









 




in the
aggregate, or (B) with a new supplier of the Business that may not be terminated (without penalty)
by Seller within thirty (30) days after the delivery of a termination notice by Seller or that
involves an amount in excess of $100,000;




               (ix) (A) assign or expressly (whether orally or in writing), or intend by its conduct to,
waive or release any rights or Claims arising out of or relating to the Business (1) with value to
the Business in excess of $100,000 individually or $250,000 in the aggregate with respect to
non-recurring Claims, (2) with respect to recurring Claims involving production suppliers, with
value to the Business in excess of $10,000 per shipset individually or (3) with any of the
suppliers set forth on Schedule 6.2(b)(ix), or (B) modify or amend in any material respect
or terminate or renew any Purchased Contract (except as may be expressly required by such Purchased
Contract in consultation with Buyer);



               (x) commence, settle or compromise, or agree to the entry of any Order in respect of, any
Claim or Legal Proceeding relating to the Business or any material Purchased Asset (including any
outstanding Claims with suppliers of the Business to the extent the same relates to or would
constitute an Assumed Liability);



               (xi) with respect to the Business, the Purchased Assets or the Assumed Liabilities, make any
payment to or enter into any Seller Contract with an Affiliate other than pursuant to Seller
Contracts existing as of the date hereof and the provision of benefits under Employee Benefit Plans
existing as of the date hereof;



               (xii) enter into any Contract that would expressly limit the freedom of the Business (except
for Seller’s applicable counterparty(ies) to any such Contract) to compete in any line of business
or with any Person or in any area; or



               (xiii) authorize, commit or agree to do any of the foregoing.



     Section 6.3 Consents and Governmental Authorizations.



          (a) Promptly after the date hereof, Seller and Buyer shall (i) use commercially reasonable
efforts to give all notices required to be given to third parties in connection with the
transactions contemplated hereby, (ii) use commercially reasonable efforts to obtain prior to the
Closing all Consents and Governmental Authorizations identified or required to be identified on
Schedule 4.3, and (iii) cooperate with and assist the other Party (including by providing
to any Governmental Entity at the reasonable request of the other Party, information relating to
such Party or its business or the Business, the Transaction Documents or the transactions
contemplated thereby) in obtaining promptly, and in any event prior to Closing, all Consents and
Governmental Authorizations identified or required to be identified on Schedule 4.3 and
Schedule 5.3. Except as may be required pursuant to Section 6.21 in connection with
the Lender Waiver, the foregoing shall not require any Party to make any payment to any Person in
order to obtain any Consent with respect to any Purchased Contract. Notwithstanding anything to
the contrary set forth herein, the Parties acknowledge and agree that Seller is responsible for
obtaining the Lender Waiver and, unless otherwise agreed by Buyer, Buyer is not obligated to make
any financial accommodation in connection with obtaining the Lender Waiver.




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          (b) Notwithstanding anything in this Agreement to the contrary, this Agreement shall not
constitute an agreement to assign at Closing any Purchased Contract or any Claim or right or any
benefit arising thereunder or resulting therefrom if an attempted assignment or transfer thereof
without the consent of a third party would constitute a breach or default thereof or give rise to a
right of termination or cancellation thereunder (any such Contract, Claim or right that constitutes
a Purchased Contract shall be referred to as a “Non-Assigned Contract,” provided that the
Site Development and Incentive Agreement shall not constitute a Non-Assigned Contract). Seller and
Buyer shall continue to use commercially reasonable efforts for one hundred and eighty (180) days
following the Closing Date to obtain the Consents necessary to assign or transfer any of the
Non-Assigned Contracts. After the Closing, Seller shall not modify, amend, terminate or renew any
Non-Assigned Contract (except as may be expressly required by such Non-Assigned Contract) without
first obtaining the written consent of Buyer (which consent may be withheld in Buyer’s sole
discretion). If such Consent is obtained following Closing, within such one hundred and eighty
(180) day period or thereafter, the applicable Non-Assigned Contract shall be deemed to have been
automatically assigned and/or transferred to Buyer on the terms set forth in this Agreement with
respect to the other Non-Assigned Contracts transferred and assumed at the Closing. If such
Consent is not obtained, Seller and Buyer will cooperate with each other, in all commercially
reasonable respects, to design an arrangement pursuant to which Buyer will receive all rights and
benefits under such Non-Assigned Contract and, subject to receiving such rights and benefits,
perform all of the obligations under such Non-Assigned Contract that are necessary for Buyer to be
entitled to receive such rights and benefits. The Parties acknowledge and agree that (x) this
Section 6.3(b) shall in no way diminish or negate the Parties’ respective obligations set
forth in clauses (i), (ii) and (iii) in Section 6.3(a) and (y) the Non-Assigned Contracts
constitute Purchased Contracts if and only if the arrangements and procedures agreed to by the
Parties in this Section 6.3(b) provide Buyer the rights and benefits of any such
Non-Assigned Contracts.




          (c) Buyer and Seller will, as promptly as practicable, but in no event later than fifteen (15)
Business Days following the execution and delivery of this Agreement, file with the United States
Department of Commerce Bureau of Industry and Security (“BIS”) a request to transfer
License Number D405984 from Seller to Buyer, together with the necessary supporting documents,
pursuant to Export Administration Regulations Section 750.10. If BIS requests additional
information or documentation, Buyer and Seller shall use commercially reasonable efforts to
promptly provide such requested information to BIS in order to facilitate obtaining a validated
letter from BIS authorizing the transfer.




          (d) Promptly after the Closing, Seller and Buyer shall use commercially reasonable efforts to
obtain the consent of the Charleston County Aviation Authority to satisfy all outstanding
requirements of Special Condition h of Department of the Army Permit No. 2004-1N-402 (the
“Wetlands Permit”), it being understood and agreed that the cooperation of the Charleston
County Aviation Authority, as owner of the North Charleston Real Property, will be necessary in
order to meet the requirements of Special Condition h. It is specifically agreed that Seller will
use commercially reasonable efforts, at Buyer’s expense, to (i) make available to Buyer (and
consent to any consultant disclosure to Buyer of) all files and current personnel necessary to its
development of the application and plans for the Wetlands Permit and coordination and approval of
such plans and terms with the Charleston County Aviation Authority and (ii) direct its applicable
current personnel to assist Buyer in communications with




52









 




the Charleston County Aviation Authority
requesting approval and filing of papers necessary to satisfy Special Condition h. It is further
understood and agreed that Buyer (i) shall be responsible for all costs of preparing and recording
any necessary deed restrictive covenants or conservation easements in a form acceptable to the
Department of the Army and (ii) shall be responsible for any costs of maintaining the preserved
wetlands and upland buffers in compliance with all applicable Law following the Closing for so long
as Buyer is a sub-tenant on the North Charleston Real Property.




     Section 6.4 Access and Information.



          (a) Except as may be (i) prohibited by applicable Law, (ii) prohibited by the terms of any
existing Seller Contract, or (iii) required to preserve legal privilege, Seller shall, upon
reasonable notice from Buyer, (A) afford to Buyer and its Representatives reasonable access to the
Purchased Assets and Seller’s books, records, officers, employees, advisors, counsel, facilities,
properties, documents and other information with respect to the Business; provided such
access will be during normal business hours and such other times as are reasonable and will be
structured so as to not unreasonably interfere with the conduct of the Business or the Purchased
Assets; and (B) provide access to Buyer, as soon as reasonably practicable upon Buyer’s reasonable
request, to make copies of such books, records, documents and information. If Seller reasonably
determines (after consultation with outside counsel) that any requested disclosure would cause any
loss of a legal or other privilege or require consent under any Seller Contract, (1) Seller shall
provide Buyer with details regarding the type and nature of the information that is prohibited from
being disclosed, including to which Sections of this Agreement such information relates and the
monetary amount involved (to the extent that Seller is able to provide such details without
compromising such attorney-client privilege or violating such confidentiality agreement), and (2)
the Parties shall use commercially reasonable efforts to make appropriate alternative disclosure
arrangements (e.g., the entry into an appropriate joint defense agreement in connection with
affording access to such information) or to obtain any such required consent. Buyer, at its sole
cost and expense and in its sole discretion, may engage an environmental consultant to conduct a
Phase I environmental investigation with respect to the North Charleston Facility, on or prior to
the Closing Date, upon at least five (5) Business Days prior written notice to Seller;
provided that, notwithstanding any provision herein to the contrary, Buyer shall not be
permitted to conduct (x) any Phase II environmental
investigation or (y) any investigation or testing involving physically invasive sampling of
soil, ground water or other substances.




          (b) Except as may be (i) prohibited by applicable Law, (ii) prohibited by the terms of any
existing Contract of Buyer, or (iii) required to preserve legal privilege, for six (6) years from
and after the Closing Date, Buyer shall, upon reasonable notice from Seller, afford to Seller and
its Representatives reasonable access to (and the ability to make copies of) all of the Business
Books and Records existing as of the Closing Date and, subject to the reasonable discretion of
Buyer, the other books and records of Buyer and its Subsidiaries relating to the conduct of the
Business following the Closing; provided such access will be during normal business hours
and such other times as are reasonable and will be structured so as to not unreasonably interfere
with the conduct of the Business; and provided further that Seller and Buyer are
not engaged in litigation or any other dispute resolution process (including any claim for
indemnification hereunder), and there does not exist any threatened or pending Claim




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(whether
written or oral) between the Parties, with respect to the Business or the transactions contemplated
by this Agreement or such documents do not relate to the subject matter of such litigation or other
proceedings or pending or threatened Claim. If Buyer reasonably determines (after consultation
with outside counsel) that any requested disclosure would cause any loss of a legal or other
privilege or require consent under any Contract of Buyer, (A) Buyer shall provide Seller with
details regarding the type and nature of the information that is prohibited from being disclosed,
including to which Sections of this Agreement such information relates and the monetary amount
involved (to the extent that Buyer is able to provide such details without compromising such
attorney-client privilege or violating such confidentiality agreement) and (B) the Parties shall
use commercially reasonable efforts to make appropriate alternative disclosure arrangements (e.g.,
the entry into an appropriate joint defense agreement in connection with affording access to such
information) or to obtain any such required consent.




     Section 6.5 Exclusivity. From the date hereof through the Closing or until such time
as this Agreement shall have been terminated pursuant to Article X, Seller will not, nor
will Seller authorize any Affiliate or Representative of Seller to, and Seller will instruct its
Affiliates or Representatives not to (a) directly or indirectly solicit, initiate, encourage or
participate in any way in (including by way of furnishing confidential information), or take any
other action that facilitates any discussion, inquiry, offer, proposal, negotiation or other
communication with any Person or group (other than Buyer or its Representatives) relating to, or
that could reasonably be expected to result in, any merger, consolidation, sale, exchange or other
disposition of any substantial portion of the assets outside of the ordinary course of business or
equity interests of or any business combination, recapitalization, liquidation, dissolution or
other similar transaction (or any combination of any of the foregoing) relating to the disposition
of all, or substantially all, or any substantial portion of, the Business or the Purchased Assets
(each, an “Acquisition Proposal”); (b) disclose, directly or indirectly, to any Person
known to Seller to be considering an Acquisition Proposal any information concerning Seller, the
Business or any of the Purchased Assets; or (c) enter into, continue or participate in any
discussions, negotiations or other communications, or enter into any understanding, Contract or
commitment, with any third party relating to, or take any action in furtherance of, any written
Acquisition Proposal received by Seller. Seller will as promptly as practicable (and in any event
within three (3) Business Days)
notify Buyer of any Acquisition Proposal. Seller shall be responsible for any breach of this
Section 6.5 by any of its Affiliates or Representatives.



     Section 6.6 Public Announcements. Each of the Parties shall, to the extent reasonably
practicable and only as permitted by applicable Law, consult with each other before issuing, and
shall provide each other with the opportunity to review and comment upon, any press release or
other public announcement or statement with respect to this Agreement or the transactions
contemplated hereunder (it being understood that, notwithstanding anything in Section 6.9
or the Non-Disclosure Agreement to the contrary, neither Party shall be required to obtain the
consent of the other Party to make any such press release or other public announcement or statement
unless such release or announcement discloses any Confidential Information of the other Party).



     Section 6.7 Transaction Expenses. Except as expressly set forth herein, each Party
shall bear its own Transaction Expenses.



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     Section 6.8 Notices of Certain Matters. From the date of this Agreement until the
Closing, Buyer and Seller shall each promptly notify the other in writing of any pending or, to the
Knowledge of such Party, threatened, Legal Proceeding (a) challenging or seeking damages in
connection with the transactions contemplated hereunder or (b) seeking to restrain or prohibit the
consummation of the transactions contemplated hereunder. The Parties shall reasonably cooperate
with each other in defending against any such Legal Proceeding, including seeking to have vacated
or reversed any stay or temporary restraining order entered in connection therewith by any court or
other Governmental Entity.



     Section 6.9 Confidentiality.



          (a) From and after the Closing, neither Buyer nor Seller shall, and each of Buyer and Seller
shall cause their respective Affiliates and Representatives not to, without first obtaining the
written consent of the other Party (which consent may be withheld in such Party’s sole discretion)
disclose to any Person (other than such Party’s Representatives) (i) any confidential or
proprietary information received from the other Party in connection with the transactions
contemplated hereby, (ii) in the case of Seller, any confidential or proprietary information that
Seller has that is contained in the Purchased Assets or that relates to the Business and (iii) the
Transaction Documents and any of the terms, conditions, negotiations or other information with
respect hereto and thereto or the transactions contemplated hereby and thereby (collectively, the
“Confidential Information”), whether furnished or available before or after the Closing,
whether documentary, electronic or oral, whether labeled or otherwise identified as confidential,
and regardless of the form of communication or the manner in which it is or was furnished.
Notwithstanding the foregoing, either Buyer or Seller or their respective Affiliates may disclose
such Confidential Information as they determine in good faith is required
by applicable Law, the rules or regulations of any national securities exchange (or the terms
of any outstanding securities of the disclosing Party) or by oral questions, interrogatories,
requests for information or other documents in legal proceedings, subpoena, civil investigative
demand or any other similar process, but only to the extent so required, or in connection with any
Claim, Legal Proceeding, Tax matter or dispute between the Parties with respect to this Agreement
or any of the Transaction Documents. If either Buyer or Seller or their respective Affiliates are
required (by oral questions, interrogatories, requests for information or other documents in legal
proceedings, subpoena, civil investigative demand or any other similar process) to disclose any
Confidential Information, such disclosing Party shall, to the extent practicable, provide the
non-disclosing Party with prompt written notice (but in any event not less than ten (10) days
advance notice) of any such requirement so that the non-disclosing Party shall have an opportunity
to seek a protective order or other appropriate remedy. The disclosing Party shall disclose only
that portion of the Confidential Information or other information that is reasonably necessary to
disclose in order to comply with such requirement. Notwithstanding the foregoing, in the event
that either Buyer or Seller or their respective Affiliates are required to disclose any
Confidential Information, such disclosing Party shall exercise their reasonable efforts to preserve
the confidentiality of such Confidential Information, including by cooperating with the
non-disclosing Party (at the non-disclosing Party’s cost and expense) to obtain an appropriate
protective order or other reliable assurance that confidential treatment will be accorded such
Confidential Information, as reasonably requested by the non-disclosing Party. Notwithstanding the
foregoing, (i) following Closing, Buyer shall not be prohibited from disclosing to any Person any
information included in the Purchased Assets or relating to the Business (other than non-




55









 




public
Transaction Documents and the terms and conditions thereof and other non-public information
relating to the transactions contemplated hereby) and (ii) the obligations of the Parties under
this Section shall expire on the second anniversary of the Closing Date; provided that,
with respect to any Confidential Information that is a trade secret of Seller, Buyer or the
Business under applicable Law, the obligations of the Parties under this Section shall apply for so
long as the owner of such Confidential Information maintains such Confidential Information as a
trade secret under applicable Law. Effective as of the Closing, the Non-Disclosure Agreement shall
terminate and shall no longer be enforceable against any party thereto. In the event of any
ambiguity or conflict between the terms and conditions of this Section 6.9(a) and the terms
and conditions of any other Transaction Document or other written agreement between Seller and
Buyer and/or Boeing, the terms and conditions of such other Transaction Document or agreement shall
control.




          (b) Promptly following the reasonable request of Buyer, Seller or any of its Subsidiaries
shall use commercially reasonable efforts to enforce all Contracts, the primary subject matter of
which is confidentiality, nondisclosure or similar agreements with respect to confidentiality
arrangements executed by or on behalf of Seller during the two (2) year period immediately
preceding the date of this Agreement in connection with the consideration of the sale of Seller
(including with respect to the sale of the Business), to the extent that Buyer or any of its
Affiliates is not a party to, or an assignee of rights under, such Contracts (or otherwise an
intended third-party beneficiary of such Contracts), with respect to the confidential information
of Buyer or any of its Affiliates relating to the Business or the Purchased Assets, on behalf of
and at the reasonable direction of Buyer, provided that Buyer shall be solely responsible
for the cost and expense of such enforcement and any Liability relating thereto.




     Section 6.10 Non-Solicitation.



          (a) Seller shall not, whether directly or indirectly, during the period beginning on the
Closing Date and ending on the second anniversary of the Closing Date (such period, the
“Restricted Period”), (i) solicit the employment of, or hire, any Initial Restricted
Employee without the prior written consent of Buyer, provided, however, that Seller
shall not be in breach of its non-solicitation obligation set forth in the foregoing clause
(i) solely as a result of any general solicitation advertisements that are not targeted at any
Initial Restricted Employees, but Seller shall be prohibited from hiring any Initial Restricted
Employees who respond to such general solicitation advertisements not targeted at the Initial
Restricted Employees; or (ii) take any action which is intended to induce any Initial Restricted
Employee to leave his or her employ with the Business.




          (b) Seller shall not, whether directly or indirectly, during the Restricted Period solicit the
employment of any Additional Restricted Employee without the prior written consent of Buyer;
provided, however, that Seller shall not be in breach of its non-solicitation
obligation under this Section 6.10(b) solely as a result of any general solicitation
advertisements that are not targeted at any Additional Restricted Employees and Seller shall not be
prohibited from hiring any Additional Restricted Employees who respond to such general solicitation
advertisements not targeted at the Additional Restricted Employees.




56









 








          (c) Except as provided in the Transition Services Agreement, Boeing Commercial Airplanes
(“BCA”) shall not, and Buyer shall not on behalf of BCA, whether directly or indirectly,
during the Restricted Period, (i) solicit the employment of, or hire, any Seller Engineering
Employees without the prior written consent of Seller, provided, however, that
Buyer shall not be in breach of its non-solicitation obligation set forth in the foregoing clause
(i) solely as a result of any general solicitation advertisements that are not targeted at any
Seller Engineering Employees, but Buyer shall be prohibited from hiring any Seller Engineering
Employee who respond to such general solicitation advertisements; or (ii) take any action which is
intended to induce any Seller Engineering Employee to leave his or her employ with Seller.




          (d) Except as provided in the Transition Services Agreement, BCA shall not, and Buyer shall
not on behalf of BCA, whether directly or indirectly, during the Restricted Period, solicit the
employment of any New Seller Engineering Employees without the prior written consent of Seller;
provided, however, that Buyer shall not be in breach of its non-solicitation
obligation under this Section 6.10(d) solely as a result of any general solicitation
advertisements that are not targeted at any New Seller Engineering Employees and Buyer shall not be
prohibited from hiring any New Seller Engineering Employees who respond to such general
solicitation advertisements not targeted at the New Seller Engineering Employees.




          (e) If Buyer or Seller breaches any the restrictive covenants set forth in this Section
6.10, then the non-breaching Party shall have the following rights and remedies against the
breaching Party, each of which shall be independent of the others and severally enforceable, and
each of the following rights and remedies is in addition to, and not in lieu of, any other rights
and remedies otherwise available to such non-breaching Party at Law or in equity for such
actions: (i) the right and remedy to have the restrictive covenant in this Section
6.10 specifically enforced against such breaching Party, including temporary restraining orders
and injunctions by any court of competent jurisdiction, it being agreed by the Parties that any
breach of this Section 6.10 would cause irreparable injury to the non-breaching Party and
that money damages would not provide an adequate remedy to the non-breaching Party, and (ii) the
right and remedy to collect from the breaching Party any such Losses incurred by the non-breaching
Party as a result of enforcing this Section 6.10.




          (f) Each Party agrees that, in the event a court of competent jurisdiction declares there has
been a breach by such Party of this Section 6.10, the term of any such term or covenant so
breached shall be automatically extended with respect to such Party for a period of time of the
violation from the date on which such breach ceases.




     Section 6.11 Intracompany Work Orders. Seller shall cancel any work orders existing
between the Business and the other businesses and facilities of Seller in existence on the Closing
Date. Such intracompany work orders shall be replaced with purchase orders agreed by Seller and
Buyer pursuant to the SOW Supply Agreement and the Transition Services Agreement.



     Section 6.12 Purchased Intellectual Property. Except as expressly provided in this
Agreement or in any other Transaction Document, (a) Seller has no right to use any of the Purchased
Intellectual Property from and after the Closing and (b) Buyer has no right to use any of the
Retained Intellectual Property from and after the Closing. Effective as of the Closing, except for
the rights expressly provided in the Transaction Documents, any and all rights and/or



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licenses
(whether express or implied) of Seller or any of its Affiliates arising from or related to any of
the Purchased Intellectual Property are hereby terminated.




     Section 6.13 Insurance.



          (a) Seller will use commercially reasonable efforts to keep insurance policies currently
maintained related to the Business, the Purchased Assets and current or former employees, or
replacements therefor, in full force and effect through the Closing Date. Buyer shall become
solely responsible for all insurance coverage after the Closing Date with respect to the Business
and the Purchased Assets.




          (b) From and after the Closing Date, none of Buyer or its Affiliates will have any rights with
respect to any of Seller’s insurance policies, except that, following Closing, (i) Seller shall pay
to Buyer all insurance proceeds (after deducting the out-of-pocket costs and expenses incurred
following Closing in connection with such claim and obtaining such proceeds) that it receives
following the date hereof to the extent relating to the Business, any of the Purchased Assets or
any of the Assumed Liabilities with respect to any claims made by Seller prior to Closing under any
policies of insurance of Seller in effect prior to the Closing, other than any such proceeds
received in respect of any Excluded Liability, and (ii) at the written request of
Buyer, Seller shall, at the cost and expense of Buyer, use commercially reasonable efforts to
seek recovery on behalf of Buyer under such insurance policies (to the extent permitted under such
insurance policies), subject to any deductible or self-retention or other policy requirement or
limit; provided that this Section 6.13 shall not require Seller to initiate, engage
in or threaten litigation with any Person, including any of its insurance carriers.




          (c) Seller shall use reasonable efforts to cause the Premises Pollution Liability Policy No.
PPL G23794603 001 issued by Illinois Union Insurance Company (the “Environmental Insurance
Policy”) to be endorsed to add Buyer and Boeing, effective as of the Closing, as additional
insureds with full unencumbered rights therein, but only with respect to Liabilities arising out of
the ownership, operation, maintenance or use of the “covered locations” as defined in the
Environmental Insurance Policy. Seller shall provide written confirmation of the insurer’s
acceptance of the foregoing obligation, assuming such acceptance is received, following Seller’s
receipt thereof from the insurer. Seller will use commercially reasonable efforts to keep the
Environmental Insurance Policy in full force and effect through the full term of the Environmental
Insurance Policy and will provide Buyer with ninety (90) days prior written notice before amending,
commuting, terminating or otherwise changing the Environmental Insurance Policy (it being
understood that the expiration of the Environmental Insurance Policy by its terms, or erosion of
aggregate limits resulting from claims activity, will not constitute any such action).




     Section 6.14 Litigation Support. Subject to Section 6.4(b) with respect to
books and records of Buyer and its Subsidiaries related to the conduct of the Business following
the Closing, in the event and for so long as either Party is actively contesting or defending
against any Claim brought by a third party in connection with any fact, situation, circumstance,
status, condition, activity, practice, plan, occurrence, event, incident, action, failure to act or
transaction involving the Business, the other Party shall reasonably cooperate with the contesting
or defending Party and its counsel in the contest or defense, make available its personnel and



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provide such access to its non-privileged books and records as may be reasonably requested in
connection with the contest or defense, at the sole cost and expense of the contesting or defending
Party (unless such contesting or defending Party is entitled to indemnification therefor under
Article XI, in which case, the costs and expense shall be borne by the Indemnifying Persons
to the extent provided in Article XI). Notwithstanding the foregoing, this Section
6.14 shall not apply to pending or threatened Claims (whether written or oral) with respect to
which the Parties are in dispute with each other.




     Section 6.15 Transfer of Governmental Authorizations. Seller shall use commercially
reasonable efforts to assist Buyer, upon Buyer’s reasonable request, in providing notices and
otherwise taking actions required to transfer or reissue any Governmental Authorizations as a
result of or in furtherance of the transactions contemplated by this Agreement. Seller shall use
commercially reasonable efforts to cooperate with Buyer, upon Buyer’s reasonable request, to
provide information necessary to apply for the transfer or reissuance of such Governmental
Authorizations. Notwithstanding anything to the contrary in Section 6.9 or the
Non-Disclosure Agreement, Buyer and Seller shall, after reasonable prior notice to and consultation
with the other Party, be permitted to provide
confidential or proprietary information of the other Party to Governmental Entities to the
extent necessary to transfer or reissue any Governmental Authorization to Buyer.



     Section 6.16 787 Supply Agreement. At the Closing, Seller shall, and Buyer shall
cause Boeing to, enter into a termination agreement in the form of Exhibit A attached
hereto (the “Termination and Mutual Release Agreement”), pursuant to which the 787 Supply
Agreement will be terminated simultaneously with the Closing, except as provided in the Termination
and Mutual Release Agreement.



     Section 6.17 Delivery of Financial Information. From the date of this Agreement until
the Closing, Seller will deliver to Buyer (i) an updated calculation of the Adjusted Net Investment
Amount, as of the last day of each month ended after the date hereof and (ii) the internal,
unaudited balance sheets of the Business and the related statements of income and cash flows of the
Business as of the last day of each monthly reporting period ended after June 1, 2009
(collectively, the “Interim Financial Information”), within thirty (30) days after the
conclusion of each month. The Interim Financial Information will be prepared in accordance with
(a) the Business Books and Records and (b) the accounting practices, policies and methodologies
used by Seller in preparing its internal, unaudited financial statements attached to Schedule
4.4.



     Section 6.18 Cash Management.



          (a) The Parties agree that (i) Seller will be liable for payment of, and will fund all amounts
in respect of, all checks issued by Seller relating to the Purchased Contracts that are outstanding
as of the Closing Date and presented for payment after the Closing Date in disbursement accounts of
Seller or any of its Affiliates and (ii) Buyer will be liable for payment of, and will fund all
amounts in respect of, all checks relating to the Purchased Contracts that are not yet outstanding
as of the Closing Date and presented for payment after the Closing Date.




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          (b) (i) Seller will, and will cause its Subsidiaries to, promptly pay to Buyer the amount of
any payments under the Purchased Contracts received by Seller or any of its Subsidiaries after the
Closing Date, whether received in lock boxes, via wire transfer or otherwise, and (ii) Buyer will,
and will cause its Subsidiaries to, promptly pay to Seller the amount of any payments in respect of
the Excluded Assets received by Buyer or any of its Affiliates after the Closing Date, whether
received in lock boxes, via wire transfer or otherwise.




     Section 6.19 Title Insurance. In the event Buyer elects to obtain a leasehold title
insurance policy for the interest to be acquired by Seller in the North Charleston Real Property,
Seller shall, at Buyer’s cost and expense, reasonably cooperate with Buyer in providing consents
and otherwise taking actions required to issue any such policy.



     Section 6.20 Letters of Credit; Surety Bond. Schedule 6.20 sets forth each of the surety bonds and letters of credit made or
provided by Seller and its Affiliates (or any of them) for the benefit of the Business (the
“Guarantees”) outstanding as of the date of this Agreement. Buyer and Seller shall each
use its commercially reasonable efforts (which shall not require any modifications of the terms of
the underlying obligations) to cause Buyer or one or more of its Affiliates to be substituted in
all respects for Seller and its Affiliates effective as of the Closing Date, in respect of all
obligations of Seller and its Affiliates under each of the Guarantees. If Buyer is unable to
effect such a substitution with respect to any such Guarantee after using its commercially
reasonable efforts to do so, then Buyer shall (i) obtain letters of credit, on terms and from
financial institutions reasonably satisfactory to Seller, with respect to the obligations covered
by each of the Guarantees for which Buyer does not effect such substitution in an amount equal to
the amount of each such Guarantee identified by Seller to Buyer in writing prior to the Closing and
(ii) until Buyer obtains such letters of credit referred to in the foregoing clause (i), not, and
not permit the Business or any of Buyer’s Affiliates to renew or extend the term of, or increase
its obligations under, or transfer to another third party, any Contract underlying such Guarantee.
From the date of this Agreement until the Closing, Seller shall not enter into or modify or amend
any Guarantee without first consulting with Buyer.



     Section 6.21 Lender Waiver. From the date hereof until the earlier to occur of (i)
the Closing and (ii) the termination of this Agreement pursuant to Article X, Seller will,
and will cause its Subsidiaries to, use their commercially reasonable efforts to obtain such
written waiver from the Required Lenders (as defined in the Seller Senior Credit Agreement) of the
covenant in Section 7.5(b) of the Seller Senior Credit Agreement as is necessary to permit
consummation of the transactions contemplated hereby on terms reasonably acceptable to Seller (the
“Lender Waiver”), including (a) making senior management of Seller and its Subsidiaries
reasonably available to respond to questions and other requests for information from such lenders,
(b) using commercially reasonable efforts to negotiate the definitive documentation for the Lender
Waiver, (c) using commercially reasonable efforts to procure other definitive financing documents
or other reasonably requested certificates or documents, including comfort letters, customary
certificates (including a certificate of the chief financial officer of Seller with respect to
solvency matters) and legal opinions and (d) using commercially reasonable efforts to satisfy on a
timely basis all agreed upon conditions under the documents entered into by Seller or its
Subsidiaries in connection with obtaining the Lender Waiver (excluding any document to which Boeing
or any of its Subsidiaries is a party). Seller shall keep Buyer reasonably informed on a current
basis of any material development relating to the Lender Waiver and the status of Seller’s efforts
to obtain the Lender Waiver.




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ARTICLE VII




TAX MATTERS




     Section 7.1 Liability for Taxes.



          (a) Seller is responsible for and will timely pay any Taxes arising or resulting from or in
connection with the conduct of the Business or the ownership or use of the Purchased Assets
attributable to any Tax period ending on or before the Closing Date (a “Pre-Closing
Period”) other than any Assumed Liability. Buyer is responsible for and will timely pay any
Taxes arising or resulting from or in connection with the conduct of the Business or the ownership
or use of the Purchased Assets attributable to any Tax period beginning after the Closing Date (a
“Post-Closing Period”) and any Taxes that are an Assumed Liability.




          (b) The Parties agree that any Apportioned Taxes, and any refund, rebate or similar payment
received by Seller or Buyer for any Apportioned Taxes, will be apportioned between Seller and Buyer
as follows:




               (i) For Apportioned Taxes measured by the amount or level of any item (including such taxes as
are measured by the value of intangibles), Seller is responsible for the amount of such Apportioned
Taxes that are determined by multiplying (A) the amount or level of such items immediately prior to
the Closing, by (B) a fraction, the numerator of which is the number of calendar days in the
portion of the Straddle Period ending on the Closing Date and the denominator of which is the
number of calendar days in the entire Straddle Period.



               (ii) For all Apportioned Taxes not described in clause (i), Seller is responsible for the
amount of such Apportioned Taxes that are determined by multiplying (A) the amount of such
Apportioned Taxes for the entire Straddle Period, by (B) a fraction, the numerator of which is the
number of calendar days in the portion of the Straddle Period ending on the Closing Date and the
denominator of which is the number of calendar days in the entire Straddle Period.



               (iii) All Apportioned Taxes that are not the responsibility of Seller pursuant to Section
7.1(b)(i) through Section 7.1(b)(ii) hereof shall be the responsibility of Buyer.



          (c) For the avoidance of doubt, Seller and Buyer are each responsible for their own Income
Taxes arising out of their conduct of the Business or their ownership or use of the Purchased
Assets, including Income Taxes arising out of the transactions contemplated in this Agreement.




          (d) Notwithstanding any other provision contained in this Agreement (including the limitations
set forth in Sections 11.2 or 11.3), any obligation arising out of this Section
7.1 will not be subject to any limits of minimum or maximum amounts, measurement of aggregate
amount of Losses or any limit of time.




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     Section 7.2 Tax Return Filing.



          (a) Seller will prepare and file all Tax Returns required to be filed for any Pre-Closing
Period with respect to the Business and the Purchased Assets, including such Tax Returns that are
required to be filed after the Closing Date. Seller will properly prepare and file such Tax
Returns no later than the due dates thereof, as such dates may be extended, in
accordance with past practice to the extent permitted by applicable Law. Seller will pay all
Taxes and other payments required to be paid for periods covered by such Tax Returns at the time
such Tax Returns are filed.




          (b) Buyer will prepare and file all Tax Returns required to be filed for any Post-Closing
Period and any Straddle Period (or portion thereof) for which Seller is not required to file a Tax
Return pursuant to Section 7.2(a) with respect to the Business and the Purchased Assets.




          (c) In the event that either Seller or Buyer is liable pursuant to Section 7.1 for any
Taxes paid by the other Party with respect to any Tax Return, reimbursement shall be made within
ten (10) days after receipt of a request for such reimbursement and documentation reasonably
evidencing such payment obligation.




          (d) For the avoidance of doubt, Seller and Buyer are each responsible for the preparation and
filing of their own Income Tax Returns and payment of Income Taxes required to be paid for periods
covered by such Income Tax Returns.




     Section 7.3 Tax Contests; Audit Responsibilities.



          (a) Seller shall have the right to control the conduct of any investigation, audit or other
proceeding by or with any Governmental Entity with respect to Taxes for which Seller is responsible
under Section 7.1(a). Buyer shall have the right to control the conduct of any
investigation, audit or other proceeding by or with any Governmental Entity with respect to Taxes
for which Buyer is responsible under Section 7.1(a). If the settlement or final
determination of any proceeding described in this subsection could reasonably be expected to have
an adverse effect on Taxes of the other Party, the controlling Party shall not consent to the
settlement or final determination of such proceeding without the other Party’s written consent,
which consent shall not be unreasonably delayed, conditioned or withheld.




          (b) Each of Buyer and Seller agree to give written notice to the other of any notification of
an investigation, audit or other proceeding by or with any Governmental Entity with respect to any
Taxes allocated to the other pursuant to this Article VII within 15 days after its receipt
of such notification by the Governmental Entity.




          (c) Buyer shall control any investigation, audit or other proceeding by or with a Governmental
Entity with respect to Apportioned Taxes (an “Apportioned Taxes Claim”), provided, that (i)
the Buyer shall keep Seller informed regarding the progress and substantive aspects of any
Apportioned Taxes Claim, including providing Seller with all written materials relating to such Tax
proceeding received from the relevant Governmental Entity and all written materials submitted to
such taxing authority by the Buyer, (ii) Seller shall be entitled to participate in any Apportioned
Taxes Claim, including having an opportunity to comment on any




62









 




written materials prepared in
connection with any Apportioned Taxes Claim and attending any conferences relating to any
Apportioned Taxes Claim and (iii) Buyer shall not consent to the settlement or final determination
in such proceeding without the Seller’s prior written consent,
which consent shall not be unreasonably delayed, conditioned or withheld. Each Party shall
bear its own costs for participating in such Tax contest.




          (d) Any net refunds and credits attributable to the payment of Taxes that are the
responsibility of Seller pursuant to Section 7.1 shall be for the account of Seller. Any
net refunds and credits attributable to the payment of Taxes that are the responsibility of Buyer
pursuant to Section 7.1 shall be for the account of Buyer.




     Section 7.4 Cooperation.



          (a) Each of Seller and Buyer shall:




               (i) provide assistance to each other Party as reasonably requested in preparing and filing Tax
Returns and Income Tax Returns with respect to the Business and the Purchased Assets and responding
to audits or disputes with Governmental Authorities;



               (ii) make available to each other Party as reasonably requested all information, records, and
documents relating to Taxes concerning the Business or the Purchased Assets, provided that no Party
shall be required to provide any Income Tax Return or related work papers unless the other Party
can show reasonable good cause for needing such information in connection with any audit or
examination of any Income Taxes of the Business and such information is not otherwise available to
the requesting Party without providing an Income Tax Return or related work papers; and



               (iii) retain any books and records that could reasonably be expected to be necessary or useful
in connection with any preparation by any other party of any Tax Return or Income Tax Return, or
for any audit, examination, or proceeding relating to Taxes or Income Taxes. Such books and
records shall be retained until the expiration of the applicable statute of limitations (including
extensions thereof) or applicable time for any appeals, if relevant.



          (b) On or before the Closing Date, each of Buyer and Seller will work together to obtain
and/or furnish to the other Party any applicable forms, certificates, or other information that is
requested by a Party to obtain any exemption or reduction from Transfer Taxes or other Taxes.
Buyer shall provide a properly completed sales Tax manufacturing/resale exemption certificate to
Seller within a reasonable period of time after the Closing Date, and Seller shall accept such
certificate for purposes of filing the Transfer Tax Returns under Section 7.5 hereof,
provided such certificate is provided to Seller within a reasonable period of time after the
Closing Date.




          (c) Seller and Buyer agree that they will cooperate in the transition of payroll tax
withholding and reporting and will seek to accomplish such transition in a manner that will
minimize the tax effect on any Transferred Employees, to the extent administratively practicable,
but Buyer will determine in its sole discretion whether to elect to be the “successor employer” for
purposes of Section 3121 of the Code.





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     Section 7.5 Transfer Taxes . Notwithstanding any requirement of Law, and
notwithstanding anything else to the contrary
in this Agreement except for Buyer’s obligation to provide a properly completed sales Tax
manufacturing/resale exemption certificate to Seller under Section 7.4(b) hereof, Buyer and
Seller will each be responsible for one half of any and all Transfer Taxes. The Party required
under applicable Laws to file any necessary Transfer Tax Returns shall file such Transfer Tax
Returns no later than the due dates thereof, as such dates may be extended. Seller agrees that it
will file (a) any applicable deed recording fee return (and any attachments and exhibits thereto)
with respect to the South Carolina real property, and (b) any applicable South Carolina sales Tax
Return that is to be filed with respect to the transaction contemplated by this Agreement. Buyer
and Seller agree that the fair market value of the real property and tangible personal property
subject to Transfer Taxes shall be determined as set forth in Schedule 7.5. All Transfer
Taxes required to be paid will be paid by the Parties at the time Transfer Tax Returns are filed.



ARTICLE VIII




EMPLOYEE MATTERS




     Section 8.1 Employment. Schedule 8.1(a)(i) contains the names of all
employees of the Business as of the date of this Agreement employed by Seller in North Charleston,
South Carolina (as reflected in Seller’s payroll system for the North Charleston Facility) and any
employees of the Business stationed with or assigned to subcontractors of the Business (including
field service, surveillance and quality control personnel) or assigned to Buyer’s manufacturing
facilities as of the date of this Agreement. Seller shall deliver to Buyer an updated Schedule
8.1(a)(i) at least ten (10) days prior to the Closing Date. Seller will have provided the
following information to Buyer with respect to each such employee as of the date hereof (which
information will be updated at least ten (10) days prior to the Closing Date): employee name,
employee number, job title, job code, work location, service start date, date of birth, home
address, shift, current base salary (hourly rate for non-exempt employees), any additives to such
base salary such as shift differentials or cost of living adjustments, citizenship status, whether
such employee is on active status or a leave of absence, and the names of any employees for which
Seller is in the process of terminating. Schedule 8.1(a)(ii) contains the names, job
titles and work locations of all employees who are currently employed by Seller who are no longer
Employees and who are not Retained Employees, but who were employed by Seller at the North
Charleston Facility primarily in connection with the Business as of January 1, 2009. Prior to the
Closing, Buyer shall extend an offer of employment (each an “Offer” and collectively, the
“Offers”) to each Employee set forth on such updated Schedule 8.1(a)(i) other than
the Retained Employees and the employees for which Seller is in the process of terminating, as
provided in this Article VIII. Employees who accept such Offer of employment from Buyer and
whose employment with the Business continues with Buyer as of the applicable Hire Date shall be
referred to herein as “Transferred Employees.” In the event Buyer does not extend an Offer
to an Employee set forth on Schedule 8.1(a)(i) (as such schedule is updated pursuant to
this Section 8.1) (other than Retained Employees), or revokes such an Offer prior to the
Closing, then notwithstanding any other provision of this Agreement to the contrary, Buyer shall be
responsible for all costs and Liabilities with respect to such Employee that arise from conduct of
Buyer or any of its Affiliates or from the termination of employment
of such Employee by Seller immediately prior to, on or
after the Closing Date or from any tort or discrimination Claims brought by such Employee
against Seller.




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     Section 8.2 Non-Union Employees.



          (a) The Offers shall provide each Employee with a consideration period that is no less than
one week (the “Offer Consideration Period”). The Offers shall provide that as of the Hire
Date, the applicable Employee’s terms and conditions of employment will include (i) the same or a
more favorable base wage and (ii) overall compensation and employee benefits that are substantially
comparable in the aggregate to the terms of the Employee’s employment with Seller in existence
immediately prior to the Hire Date (collectively, “Minimum Terms and Conditions of
Employment”). As of the Hire Date and, except as otherwise provided herein, for a period of
not less that twelve (12) months after the Closing Date, the employment of Transferred Employees
shall be on terms and conditions no less favorable than the Minimum Terms and Conditions of
Employment. “Hire Date” shall mean (A) with respect to Employees who are not Absent
Employees and who will become Transferred Employees, 12:01 a.m. Eastern Time on the Closing Date or
(B) with respect to Absent Employees, 12:01 a.m. Eastern Time on the first business day the
applicable Absent Employee returns to active employment from leave. Buyer shall notify Seller of
the acceptance and rejections of Offers of employment that have been received from each of the
Employees (x) on at least a weekly basis during the Offer Consideration Period and (y) in total
within three (3) Business Days following the end of the Offer Consideration Period.




          (b) Except as described in the next sentence of this Section 8.2(b), the employment of
each Transferred Employee (including any Employee, other than an Absent Employee, who is absent
from active employment and receiving workers’ compensation benefits or is on short-term disability
or approved leave of absence) with Seller shall cease immediately prior to the Hire Date, and the
employment of each such Transferred Employee with Buyer shall commence immediately upon the Hire
Date. In the case of any Employee who is absent from active employment on long-term disability,
and who receives and accepts an Offer from Buyer prior to the Closing (the “Absent
Employees”), the employment of such individual with Buyer shall commence upon the date of his
or her return to active work, and such Employee shall become a Transferred Employee as of such
date. Notwithstanding anything in this Agreement to the contrary, no personnel records with
respect to a Transferred Employee will be transferred to Buyer until the applicable Hire Date with
respect to each such Transferred Employee. Buyer shall be permitted to seek any releases required
by applicable Law from the employees of Seller set forth on Schedule 8.1(a)(i) with respect
to such employees’ medical records prior to the Closing Date (provided that Buyer shall not
condition any Offers on an Employee furnishing any such release), and Buyer shall be permitted to
view and make copies of such medical records with respect to an employee once such employee has
signed such release.




          (c) The vacation program adopted by Buyer for the Transferred Employees shall recognize years
of service with Seller for purposes of computing vacation benefits. Buyer shall assume and be
responsible for, and shall give full credit for, all vacation benefits of the Transferred Employees
accrued but not taken as of the Closing Date. Seller shall have no
responsibility or Liability for any vacation benefits of the Transferred Employees on or after
the Closing Date, including vacation benefits accrued prior to the Closing Date. Buyer and Seller




65









 







acknowledge and agree that Buyer shall not assume any Liabilities for vacation benefits accrued
through the Closing Date for any Employee that does not become a Transferred Employee.




          (d) Excluding defined benefit pension and retiree medical plans, Buyer shall recognize the
service start date of each Transferred Employee as set forth in Schedule 8.1(a)(i) for all
purposes, including membership, vesting, benefit accrual rate and entitlement to benefits under
Buyer’s relevant employee benefit plans, except to the extent it would result in the duplication of
benefits. Seller shall provide each Transferred Employees the opportunity to retire as an active
employee of Seller under the Employee Benefit Plans for a 90-day grace period following Closing if
such Transferred Employee would have otherwise been eligible to retire. For purposes of early
retirement under Seller’s defined benefit pension plans, Seller shall treat Transferred Employees
as having been laid off.




          (e) Each Transferred Employee (and his or her eligible dependents, as applicable), shall be
immediately eligible as of the relevant Hire Date to participate in and accrue benefits under
Buyer’s employee benefit plans, which apply to Transferred Employees. With respect to each
Transferred Employee (and his or her eligible dependents, as applicable), Buyer shall cause such
plans to (i) waive any eligibility periods, evidence of insurability or pre-existing condition
limitations and (ii) honor any deductibles, co-payments, co-insurance or out-of-pocket expenses
paid or incurred by such employee, including with respect to his or her dependents, under
comparable Employee Benefit Plans of Seller during the plan year in which the relevant Hire Date
occurs.




          (f) The second and third sentences of Section 8.2(a) and Section 8.2(e) shall
not apply with respect to any Employee that, as of immediately prior to the Closing Date, is
covered by a Collective Bargaining Agreement (the “Union Employees”). For the avoidance of
doubt, in no event shall Buyer be required to provide Union Employees the Minimum Terms and
Conditions of Employment, and the provisions of Section 8.2(b) shall apply only to those
Union Employees who accept offers of employment from Buyer.




     Section 8.3 Union Employees.



          (a) Buyer will not assume, and will not be bound by, the terms and obligations of the relevant
Collective Bargaining Agreement with respect to the Union Employees as a successor or assign of
Seller. However, on the Closing Date, Buyer agrees to recognize the Union as the representative of
the Union Employees at the Union’s request, to comply with its good-faith bargaining obligations,
and to otherwise comply with its obligations under the National Labor Relations Act.




          (b) Unless otherwise agreed by Buyer and the Union, for a period of no less than twelve (12)
months following the Closing Date, Buyer shall agree to honor all recall rights held by any current
or former employees of the Business under the Collective Bargaining Agreement between Seller and
the Union dated as of November 7, 2008.




          (c) Only if (i) Buyer does not extend an offer (a “UE Offer”) to such Union Employee
(other than union employees whom Seller is in the process of terminating); (ii) Buyer revokes a UE
Offer made to such Union Employee prior to the Closing; or (iii) a Union



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Employee rejects the UE
Offer and the UE Offer to such Union Employee provided (1) wages that are less favorable than the
Union Employee’s wages immediately prior to the Closing and (2) compensation and benefits that are,
overall, less than substantially comparable in the aggregate to the Union Employee’s compensation
and benefits prior to Closing, then Buyer shall be responsible for all costs and Liabilities with
respect to any Union Employee who does not become a Transferred Employee that arise from conduct of
Buyer or any of its Affiliates or from the termination of employment of such Union Employee by
Seller immediately prior to, on or after the Closing Date or from any tort or discrimination Claims
brought by such Union Employee against Seller.




     Section 8.4 Workers’ Compensation Claims. Seller shall be responsible for and shall,
as described herein, pay Losses incurred in connection with those workers’ compensation claims
identified on Schedule 8.4. Schedule 8.4 provides a list of all workers’
compensation claims of Employees and former Employees filed with a Governmental Entity which remain
open as of the Closing Date, for which Seller will retain liability (excluding any further
liabilities on existing claims, except as provided below). As of the Closing Date, with the
exception of the claims identified on Schedule 8.4, Buyer will be responsible and liable
for all workers’ compensation claims of Employees and former Employees based on injuries or
illnesses that arise or have arisen out of, and in the course of, employment with the Business.
However, Buyer shall assume any additional liability for matters on Schedule 8.4 where the
condition, injury or illness subject of such claim recurred or was aggravated after the Closing
Date and such additional liability is incurred as a result of such recurrence or aggravation. To
the extent that any Law prevents Buyer from assuming any workers’ compensation obligation directly,
Buyer shall reimburse Seller’s costs with respect to any such workers’ compensation Losses.



     Section 8.5 WARN Act Notification. Seller shall, as soon as practicable following the
Closing, provide Buyer with a schedule setting forth the name and work location of each employee of
the Business who terminated employment within the six month period prior to the Closing Date. In
the event of any “plant closing” or “mass layoff” with respect to the Business, as defined by the
WARN Act, or any state or local Law equivalent, that shall occur on or after the Closing Date due
to any actions taken by Buyer, Buyer shall comply with all of the requirements of the WARN Act and
any applicable state and local Law equivalent, and shall assume any and all Liabilities with
respect thereto. Buyer shall indemnify and hold harmless Seller with respect to any Liabilities
under the WARN Act and similar applicable state and local Laws arising from (i) any actions taken
by Buyer with respect to the Transferred Employees on or after the Closing Date (including any
Liabilities caused by “employment losses” due to the actions of Buyer with respect to the
Transferred Employees on or after the Closing Date that trigger the WARN Act when aggregated with
any “employment losses” with respect to the Business on or prior to the Closing Date) or (ii)
Buyer’s breach of Sections 8.2 or 8.3 and/or claims by any Employee that Buyer’s
Offer pursuant to Sections 8.2 or 8.3 is not sufficiently comparable to avoid an
“employment loss” under the WARN Act and similar applicable state and local Laws (including
any Liabilities caused by “employment losses” due to the actions of Buyer with respect to the
Transferred Employees on or after the Closing Date that trigger the WARN Act when aggregated with
any “employment losses” with respect to the Business on or prior to the Closing Date).



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     Section 8.6 Employee Benefits.



          (a) COBRA. Buyer shall, effective commencing on the applicable Hire Date, be
responsible for compliance with the requirements of COBRA, including the provision of continuation
coverage, with respect to the Transferred Employees, and their spouses and dependents, for whom a
qualifying event occurs on or after the Transferred Employees’ respective Hire Dates. If Seller
complies with the notification requirements of COBRA with respect to a Transferred Employee, Buyer
shall be responsible for the provision of COBRA continuation coverage, if any, to such Transferred
Employee, and such Transferred Employee’s spouse and dependents, arising as a result of his or her
transfer of employment from Seller to Buyer hereunder.




          (b) 401(k) Plan. Seller shall fully vest Transferred Employees in their accounts held
under Seller’s Savings and Investment Plan (the “Seller 401(k) Plan”) as of the Closing
Date. Seller shall reasonably cooperate with Buyer to establish participation by Transferred
Employees in Buyer’s tax-qualified defined contribution plan or plans with a cash deferred feature
(the “Buyer 401(k) Plan”) for the benefit of each Transferred Employee who was eligible to
participate in the Seller 401(k) Plan as soon as practicable after the Closing Date. As soon as
practicable after the Closing Date, Seller shall make distributions from the Seller 401(k) Plan
available to Transferred Employees and the Buyer 401(k) Plan shall accept such distribution as a
rollover contribution if permitted under the terms of the Buyer 401(k) Plan and if so directed by
the Transferred Employee. Seller shall make any contributions to Seller 401(k) Plan relating to the
Transferred Employees that were due and payable by Seller on or before the Closing Date including
those on behalf of Transferred Employees without regard to whether such individuals were employed
on the last day of the plan year.




     Section 8.7 No Right to Employment. Nothing in this Article VIII restricts
the right of Buyer or any of its Affiliates to terminate the employment of any Transferred Employee
after the Closing. The provisions of this Article VIII are solely for the benefit of the
Parties to this Agreement, and no employee or former employee or any other individual associated
therewith or any employee benefit plan or trustee thereof shall be regarded for any purpose as a
third party beneficiary of this Agreement, and nothing herein shall be construed as an amendment to
any employee benefit plan for any purpose. To the extent Buyer complies with its obligations under
this Article VIII, nothing in this Article VIII shall be construed to limit the
right of Buyer or any of its Affiliates to amend or terminate any employee benefit plan.



     Section 8.8 Code Section 409A . The Transferred Employees shall not be deemed to have incurred a “separation from service”
for purposes of Code Section 409A as a result of their transfer of employment from Seller to Buyer
hereunder.



ARTICLE IX




CONDITIONS PRECEDENT




     Section 9.1 Conditions to Obligations of Buyer. The obligations of Buyer to effect
the Closing and the consummation of the transactions contemplated by this Agreement are subject to
the satisfaction at or prior to the Closing of each of the following conditions, any or all of
which may be waived in writing by Buyer, in whole or in part, to the extent permitted by applicable
Law:




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          (a) Seller Representations and Warranties. (i) Each of the representations and
warranties of Seller contained in Sections 4.1, 4.2, 4.19 and 4.20
shall be true and correct in all material respects as of the date hereof and the Closing Date as
though made on and as of such dates (except (x) for representations and warranties that by their
express terms address matters only as of a particular date, which representations and warranties
shall be true and correct in all material respects as of such date and (y) to the extent that such
representations and warranties are qualified by the term “Material Adverse Effect,” in which case
such representations and warranties shall be true and correct in all respects); and (ii) each of
the representations and warranties of Seller contained in this Agreement (other than the
representations and warranties contained in Sections 4.1, 4.2, 4.19 and
4.20) shall be true and correct in all respects as of the date hereof and the Closing Date
as though made on and as of such dates (except for representations and warranties that by their
express terms address matters only as of a particular date, which representations and warranties
shall be true and correct in all respects as of such date), except where the failure of such
representations and warranties (without giving effect to any of the “Material Adverse Effect”
qualifiers contained therein) to be so true and correct would not, in the aggregate, have or
reasonably be expected to have a Material Adverse Effect.




          (b) Agreements and Covenants. Seller shall have performed and complied with, in all
material respects, all agreements and covenants required by this Agreement to be performed or
complied with by Seller on or prior to the Closing Date.




          (c) No Material Adverse Effect. Since the date of this Agreement, there shall not
have occurred any Material Adverse Effect or any fact, event, change, development or effect that,
individually or when taken together with all other facts, events, changes, developments or effects,
has had or would reasonably be expected to have a Material Adverse Effect.




          (d) Consents. Seller shall have delivered to Buyer a pay-off letter from the agent
under the Seller Senior Credit Agreement, in customary form and otherwise reasonably acceptable to
Buyer (or such other evidence reasonably acceptable to Buyer) (such pay-off letter or other
evidence being referred to as the “Pay-off Letter”), providing that the Encumbrances to
which the Purchased Assets are subject under the Seller Senior Credit Agreement, the Loan Documents
(as defined in the Seller Senior Credit Agreement) and the Joinder Agreement by and
among certain lenders, Seller and Lehman Commercial Paper Inc. dated May 6, 2008 will be
released upon payment of a sum certain specified in the Pay-off Letter (the “Pay-off
Amount”) to such agent under the Seller Senior Credit Agreement.




          (e) Deliveries. Seller shall have delivered or caused to be delivered to Buyer:




               (i) a certificate executed by a duly authorized executive officer of Seller to the effect that
each of the conditions specified in Sections 9.1(a) and 9.1(b) are satisfied in all
respects;



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               (ii) a counterpart of the bill of sale and assignment and assumption agreement in the form
attached as Exhibit B (the “Bill of Sale, Assignment and Assumption Agreement”),
duly executed by Seller;



               (iii) a counterpart of the Intellectual Property assignment(s) in the form(s) attached hereto
as Exhibit C (the “Intellectual Property Assignment”), duly executed by Seller;



               (iv) a counterpart of the Intellectual Property license agreement in the form attached hereto
as Exhibit D (the “Intellectual Property License Agreement”), duly executed by
Seller;



               (v) a counterpart of the engineering services agreement in the form attached hereto as
Exhibit E (the “Engineering Services Agreement”), duly executed by Seller;



               (vi) a counterpart of the transition services agreement in the form attached hereto as
Exhibit F (the “Transition Services Agreement”), duly executed by Seller;



               (vii) a counterpart of the Termination and Mutual Release Agreement, duly executed by the
parties thereto other than Buyer and Boeing;



               (viii) a counterpart to the supply agreement in the form attached hereto as Exhibit G
(the “SOW Supply Agreement”), duly executed by Seller;



               (ix) a counterpart of the bill of sale and assignment and assumption agreement with respect to
the Facilities in the form attached as Exhibit H (the “Facilities Bill of Sale,
Assignment and Assumption Agreement”), duly executed by Seller;



               (x) a counterpart of the North Charleston Sublease Assumption in the form attached as
Exhibit I (the “North Charleston Sublease Assumption”), duly executed by Seller;



               (xi) a counterpart of the GA Sublease Assumption in the form attached as Exhibit J
(the “GA Sublease Assumption”), duly executed by Seller;



               (xii) a counterpart of the side letter regarding the SOW Supply Agreement, in the form
attached as Exhibit K (the “SOW Side Letter”), duly executed by Seller;



               (xiii) counterparts of Amendments to certain Master Program Contracts (MPC); Amendment # 6 to
MPC FZ-641900-8981N (747 Empennage) and Amendment # 6 to MPC VR-747010-8984N (747 Fuselage), in the
forms attached as Exhibit L (the “747 Amendment”), duly executed by Seller;



               (xiv) counterparts of Amendments to certain Master Program Contracts (MPC); Amendment # 5 to
MPC VR-567866-8988N (767 Doors), Amendment # 10 to MPC FZ-641600-8981N (767 Horizontals), Amendment
# 5 to MPC VZ-785548-8981N (767 WCS), and Amendment # 4 to MPC FZ-641800-8981N (48 Section), in the
forms attached as Exhibit M (the “767 Amendment”), duly executed by Seller;



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               (xv) counterparts of Amendments to certain Master Program Contracts (MPC); Amendment # 4 to
MPC VZ-641700-8981N (777 Flaps) and Amendment # 3 to MPC VZ-620700-8981N (777 Spoilers), in the
forms attached as Exhibit N (the “777 Amendment”), duly executed by Seller;



               (xvi) a counterpart of the warranty agreement related to the SOW Supply Agreement, in the form
attached as Exhibit O (the “SOW Warranty Agreement”), duly executed by Seller;



               (xvii) a counterpart of the administrative agreement regarding the SOW Supply Agreement, in
the form attached as Exhibit P (the “SOW Administrative Agreement”), duly executed
by Seller; and



               (xviii) an affidavit sworn under penalty of perjury, setting forth Seller’s United States tax
identification number and certifying that Seller is not a “foreign person” within the meaning of
Section 1445 of the Code.



          (f) No Order. No Governmental Entity or federal or state court of competent
jurisdiction shall have enacted, issued, promulgated, enforced or entered any Order (whether
temporary, preliminary or permanent), in any case which is in effect and that prevents or prohibits
the consummation of the transactions contemplated hereunder; provided that Buyer shall have
used all commercially reasonable efforts to cause any such Order to be vacated or lifted.




          (g) No Legal Proceeding. No Legal Proceeding shall be pending by the DOJ, FTC or any
authority, agency, department, board, commission or instrumentality of any state of the United
States that regulates competition or that has the power to prohibit, restrict or regulate actions
having the purpose or effect of monopolization or restraint of trade which seeks to prevent,
prohibit or make illegal the transactions contemplated by this Agreement.




     Section 9.2 Conditions to Obligations of Seller. The obligations of Seller to effect
the Closing and the consummation of the transactions contemplated by this Agreement are subject to
the satisfaction at or prior to the Closing of the following conditions, any or all of which may be
waived in writing by Seller, in whole or in part, to the extent permitted by applicable Law:



          (a) Buyer Representations and Warranties. (i) Each of the representations and
warranties of Buyer contained in Sections 5.1, 5.2 and 5.4 shall be true
and correct in all material respects as of the date hereof and the Closing Date as though made on
and as of such dates (except (x) for representations and warranties that by their express terms
address matters only as of a particular date, which representations and warranties shall be true
and correct in all material respects as of such date and (y) to the extent that such
representations and warranties are qualified by the term “material adverse effect,” in which case
such representations and warranties shall be true and correct in all respects) and (ii) each of the
representations and warranties of Buyer contained in this Agreement (other than the representations
and warranties contained in Sections 5.1, 5.2 and 5.4) shall be true and
correct in all respects as of the date hereof and the Closing Date as though made on and as of such
dates (except for representations and warranties that by their express terms address matters only
as of a particular date, which



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 representations and warranties shall be true and correct in all
respects as of such date), except where the failure of such representations and warranties (without
giving effect to any of the “material adverse effect” qualifiers contained therein) to be so true
and correct would not, in the aggregate, have or reasonably be expected to have a material adverse
effect on Buyer’s ability to consummate the transactions contemplated hereby in accordance with the
terms hereof and applicable Laws.




          (b) Agreements and Covenants. Buyer shall have performed and complied with, in all
material respects, all agreements and covenants required by this Agreement to be performed or
complied with by Buyer on or prior to the Closing Date.




          (c) Deliveries. Buyer shall have delivered or caused to be delivered to Seller:




               (i) a certificate executed by a duly authorized executive officer of Buyer to the effect that
each of the conditions specified in Sections 9.2(a) and(b) are satisfied in all
respects;



               (ii) a duly executed counterpart of the Bill of Sale, Assignment and Assumption Agreement;



               (iii) a duly executed counterpart of the Intellectual Property Assignment;



               (iv) a counterpart of the Intellectual Property License Agreement duly executed by Boeing
Management Company;



               (v) a counterpart to the Termination and Mutual Release Agreement duly executed by Boeing;



               (vi) a duly executed counterpart of the Engineering Services Agreement;



               (vii) a duly executed counterpart of the Transition Services Agreement;



               (viii) a counterpart of the SOW Supply Agreement duly executed by Boeing;



               (ix) a counterpart of the SOW Side Letter duly executed by Boeing;



               (x) a counterpart of the SOW Warranty Agreement duly executed by Boeing;



               (xi) a counterpart of the SOW Administrative Agreement duly executed by Boeing;



               (xii) a counterpart of the 747 Amendment duly executed by Boeing;



               (xiii) a counterpart of the 767 Amendment duly executed by Boeing;



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               (xiv) a counterpart of the 777 Amendment duly executed by Boeing; and



               (xv) a duly executed counterpart of the Facilities Bill of Sale, Assignment and Assumption
Agreement.



          (d) No Order. No Governmental Entity or federal or state court of competent
jurisdiction shall have enacted, issued, promulgated, enforced or entered any Order (whether
temporary, preliminary or permanent), in any case which is in effect and that prevents or prohibits
the consummation of the transactions contemplated hereunder; provided that Seller shall
have used all commercially reasonable efforts to cause any such Order to be vacated or lifted.




          (e) Waiver Under Seller Senior Credit Facility. Seller shall have received the Lender
Waiver.




          (f) No Legal Proceeding. No Legal Proceeding shall be pending by the DOJ, FTC or any
authority, agency, department, board, commission or instrumentality of any state of the United
States that regulates competition or that has the power to prohibit, restrict or regulate actions
having the purpose or effect of monopolization or restraint of trade which seeks to prevent,
prohibit or make illegal the transactions contemplated by this Agreement.




ARTICLE X




TERMINATION




     Section 10.1 Termination. This Agreement may be terminated at any time (except where
otherwise indicated in this Section 10.1) prior to the Closing Date:



          (a) by mutual written consent of Buyer and Seller;




          (b) (i) by Buyer, prior to Closing, by written notice to Seller from Buyer if (A) there is any
material breach of any representation, warranty, covenant or agreement on the part of Seller set
forth in this Agreement, such that the conditions specified in Section 9.1(a) or
Section 9.1(b) would not be satisfied at the Closing (a “Terminating Seller
Breach”), except that,
if such Terminating Seller Breach is an unintentional or inadvertent breach of a
representation, warranty, covenant or agreement and is curable by Seller through the exercise of
its reasonable best efforts, then, for a period of up to ten (10) days after receipt by Seller of
notice from Buyer of such breach, but only as long as Seller continues to use its reasonable best
efforts to cure such Terminating Seller Breach (the “Seller Cure Period”), such termination
shall not be effective, and such termination shall become effective only if the Terminating Seller
Breach is not cured within the Seller Cure Period, or (B) the consummation of the transactions
contemplated hereby is permanently enjoined, prohibited or otherwise restrained by the terms of a
final, non-appealable Order of a Governmental Entity; provided that, in the case of the
forgoing clause (A), Buyer is not then in material breach of any of its obligations under this
Agreement;




               (ii) by Seller, prior to Closing, by written notice to Buyer from Seller if (A) there is any
material breach of any representation, warranty, covenant or agreement on the part of Buyer set
forth in this Agreement, such that the conditions specified in Section 9.2(a) or



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Section 9.2(b) would not be satisfied at the Closing (a “Terminating Buyer
Breach”), except that, if such Terminating Buyer Breach is an unintentional or inadvertent
breach of a representation, warranty, covenant or agreement and is curable by Buyer through the
exercise of its reasonable best efforts, then, for a period of up to ten (10) days after receipt by
Buyer of notice from Seller of such breach, but only as long as Buyer continues to use its
reasonable best efforts to cure such Terminating Buyer Breach (the “Buyer Cure Period”),
such termination shall not be effective, and such termination shall become effective only if the
Terminating Buyer Breach is not cured within the Buyer Cure Period, or (B) the consummation of the
transactions contemplated hereby is permanently enjoined, prohibited or otherwise restrained by the
terms of a final, non-appealable Order of a Governmental Entity; provided that, in the case
of the forgoing clause (A), Seller is not then in material breach of any of its obligations under
this Agreement; or




          (c) by either Buyer or Seller, if the Closing shall not have been consummated by August 31,
2009, upon delivery of written notice signed by Buyer or Seller, as applicable, to the other Party;
provided, however, that the right to terminate this Agreement under this
Section 10.1(c) shall not be available to a Party, in the event that such Party is in
material breach of any covenant or agreement under or contained in this Agreement.




     Section 10.2 Effect of Termination. In the event of termination of this Agreement as
provided in Section 10.1, this Agreement shall forthwith become null and void and there
shall be no Liability or obligation on the part of Buyer or Seller or any of their respective
Representatives except (a) nothing herein shall relieve any Party from Liability for any breach of
any representation, warranty, covenant or agreement in this Agreement prior to the date of
termination; (b) each Party shall be entitled to any and all remedies at law and in equity for any
such breach and (c) this Article X and Article XII of this Agreement shall remain
in full force and effect and survive any termination of this Agreement; provided,
however, that, in the event this Agreement is terminated pursuant to Section 10.1,
the Parties acknowledge that it is the intention of the Parties that no Party shall have any remedy
or right to recover for any Losses resulting from any breach of any representation or warranty
contained herein unless such breach was intentional or willful on the part of the breaching Party.
In determining Losses recoverable by a Party for the other Party’s breach, the Parties acknowledge
and agree that such Losses shall not be limited to
reimbursement of expenses or out-of-pocket costs and shall include the benefit of the bargain
lost by such Party.



ARTICLE XI




INDEMNIFICATION




     Section 11.1 Survival. All of the representations and warranties contained in this
Agreement will survive until the date that is thirteen (13) months after the Closing Date, except
that (a) the representations and warranties contained in Sections 4.1 (Organization and
Qualification), 4.2 (Authority; Enforceability), the first sentence of Section 4.7,
the first sentence of Section 4.10(b), Sections 4.19 (Certain Transactions),
4.20 (Broker’s Fees), 5.1 (Organization and Qualification), 5.2 (Authority;
Enforceability) and 5.4 (Broker’s Fees) will survive the Closing indefinitely, and (b) the
representations and warranties contained in the first two sentences of Section 4.10(c) will
survive the Closing until the date that is twenty-four (24) months after the Closing Date, and (c)
the representations and warranties contained in Section



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4.15 (Tax Matters) will survive the
Closing until sixty (60) days following expiration of the applicable statute of limitations (as may
be extended by agreement with any Governmental Entity); provided, however, that no
representation or warranty set forth in this Agreement will expire or terminate with respect to any
breach or inaccuracy to the extent such inaccuracy or breach thereof results from or arises out of
any fraud by Seller in connection with this Agreement. All covenants and other agreements
contained in this Agreement will survive the Closing indefinitely unless otherwise provided in
accordance with their respective terms; provided, that the covenants and agreements
contained in Sections 6.1 and 6.2 will survive until a date that is twenty-four
(24) months after the Closing Date. Seller’s indemnification obligation in Section 11.2(c)
will survive until the date that is thirty-six (36) months after the Closing Date. Notwithstanding
anything herein to the contrary, each representation, warranty, covenant or agreement which is the
subject of one or more Claims for indemnification pursuant to this Article XI asserted in
writing prior to the expiration of the applicable survival period set forth above will survive with
respect to only such Claim or Claims until the final resolution thereof. No Claim for
indemnification for breach of any representation, warranty, covenant or agreement shall be made
after the survival date, if any, applicable to such representation, warranty, covenant or
agreement.




     Section 11.2 Indemnification by Seller.



          (a) Seller hereby agrees (subject to the terms of this Article XI) to indemnify,
defend and hold harmless Buyer and its successors and permitted assigns, and each of their
respective Affiliates, equityholders, officers, directors, managers, members, employees and
Representatives (each, a “Buyer Indemnified Person”) for, from and against any and all
Losses imposed upon or incurred by Buyer Indemnified Persons, or any of them, to the extent arising
out of or resulting from any and all of the following (whether or not arising out of any Third
Party Claims): (i) any inaccuracy as of the Closing Date in, or any breach of, a representation or
warranty contained in Article IV of this Agreement; (ii) any breach by Seller of, or any failure by
Seller to perform or comply with, any covenant or agreement contained in this Agreement; and
(iii) any of the Excluded Liabilities. For purposes of determining the amount of any Loss incurred
in connection with any inaccuracy or a breach of a representation or warranty under this
Section 11.2(a) or whether such inaccuracy or breach has occurred, in each case (other than
with respect to the Qualified Representations), all references to “materiality” or “Material
Adverse Effect” or other similar terms shall be disregarded.




          (b) Notwithstanding the foregoing provisions of this Section 11.2 to the contrary, (i)
except with respect to any Loss that arises out of a breach of Section 4.1, Section
4.2, the first sentence of Section 4.7, the first sentence of Section 4.10(b),
Section 4.15, Section 4.19 and/or Section 4.20, with respect to Seller’s
obligation to indemnify Buyer Indemnified Persons for Losses pursuant to Section 11.2(a)(i)
(other than with respect to the first two sentences of Section 4.10(c) which are addressed
in Section 11.2(b)(ii) below) and, solely with respect to clause (C) below, Section
11.2(a)(ii) (as applied solely to a breach of Section 6.1 and no other covenant or
agreement herein): (A) Seller will not be required to indemnify Buyer Indemnified Persons until
such Losses in the aggregate exceed $10,000,000 and in such case Seller will, subject to clause
(i)(C) of this Section 11.2(b) and Section 11.5, be required to indemnify Buyer
Indemnified Persons for the amount of such Losses in excess of $10,000,000; (B) no individual Claim
(or series of related Claims or repetitive or multiple Claims from the



75









 






same source) by Buyer
Indemnified Persons may be asserted unless and until the aggregate amount of Losses that would be
payable pursuant to such Claim (or series of related Claims or repetitive or multiple Claims from
the same source) exceeds an amount equal to $50,000; and (C) the aggregate amount to be paid by
Seller to Buyer Indemnified Persons will not exceed an amount equal to $60,000,000 (it being
understood that any Losses indemnified pursuant to Section 11.2(a)(i) (with respect only to
the first two sentences of Section 4.10(c)) or Section 11.2(c) shall also be
applied toward such $60,000,000 after $40,000,000 in Losses have been paid pursuant to Section
11.2(b)(ii)); and (ii) with respect to Seller’s obligations to indemnify Buyer Indemnified
Persons for Losses pursuant to Section 11.2(a)(i) (with respect only to the first two
sentences of Section 4.10(c)) and Section 11.2(c), (A) Seller will not be required
to indemnify Buyer Indemnified Persons until such Losses in the aggregate exceed $10,000,000 and in
such case Seller will, subject to clause (ii)(C) of this Section 11.2(b) and Section
11.5, be required to indemnify Buyer Indemnified Persons for the amount of such Losses in
excess of $10,000,000; (B) no individual Claim (or series of related Claims or repetitive or
multiple Claims from the same source) by Buyer Indemnified Persons may be asserted unless and until
the aggregate amount of Losses that would be payable pursuant to such Claim (or series of related
Claims or repetitive or multiple Claims from the same source) exceeds an amount equal to $50,000;
and (C) the aggregate amount to be paid by Seller to Buyer Indemnified Persons will not exceed an
amount equal to $100,000,000 (it being understood that any Losses indemnified pursuant to
Section 11.2(a)(i) (other than with respect to the first two sentences of Section
4.10(c) and Section 11.2(a)(ii) (as applied solely to a breach of Section 6.1
and no other covenant or agreement herein) shall also be applied toward such $100,000,000).




          (c) Seller hereby agrees (subject to the terms of this Article XI) to indemnify,
defend and hold harmless each Buyer Indemnified Person for, from and against any and all Losses
imposed upon or incurred by Buyer Indemnified Persons, or any of them, to the extent arising out of
or resulting from (whether or not arising out of any Third Party Claims) any (A) misappropriation
of any trade secret of any Person arising from the conduct of the Business or
the conduct of any supplier of Seller prior to the Closing or (B) infringement or unlawful
use of any United States or foreign Intellectual Property right (including any right in a Patent,
Copyright, industrial design or semiconductor mask work), which, in the case of any industrial
design or patent, was either issued as of the date of this Agreement or issues after the date of
this Agreement from an application that was pending as of the date of this Agreement (including all
foreign counterparts of each of the foregoing (whether or not such foreign counterpart was filed or
issued as of the date of this Agreement)) or, in the case of any other Intellectual Property, was
in existence on the Closing, in each case: (i) arising out of the design, manufacture or sale of
Products by or for Seller pursuant to the 787 Supply Agreement prior to the Closing, including to
the extent attributable to Intellectual Property or Products delivered by a supplier of Seller (or
other activities of such supplier) (“Supplied Products”); (ii) arising out of the use or
sale of Supplied Products (including Products included in the Purchased Assets) by or for a Buyer
Indemnified Person or a customer of a Buyer Indemnified Person or an operator of a Program
Aircraft; and (iii) arising out of the manufacture, use or sale of any Covered Products by or for a
Buyer Indemnified Person or a customer of a Buyer Indemnified Person or an operator of a Program
Aircraft; provided, however, that notwithstanding any provision hereof to the
contrary, Seller’s indemnification obligations under this Section 11.2(c) shall not extend
to any Losses due to misappropriation, infringement or unlawful use of any Intellectual Property or
Intellectual Property right:





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               (A)



                    (1) with respect to Third Party Claims for misappropriation, infringement or unlawful use
(excluding a Claim by a supplier to the Business for misappropriation, infringement or unlawful use
attributable to Intellectual Property or Products delivered by, or other activities of, such
supplier) to the extent attributable to Intellectual Property of, or Products delivered by, or
other activities of, a supplier to the Business, except to the extent such misappropriation,
infringement or unlawful use arises out of or results from such supplier’s compliance with any
specification, design, design or specification change or any method or process of design or
manufacturing (and changes thereto) required by Seller, in which case Seller will (to the extent
provided above in this Section 11.2(c) and subject to Section 11.2(b) and the other
provisions of this Article XI) indemnify the Buyer Indemnified Persons for such
misappropriation, infringement or unlawful use, subject to paragraphs (B)-(G) below;
provided that (I) Seller shall (subject to the last two sentences of this paragraph (1))
have no obligation to indemnify any Buyer Indemnified Person hereunder to the extent that such
Buyer Indemnified Person is entitled to indemnification for, or is otherwise entitled to recover in
respect of, such misappropriation, infringement or unlawful use pursuant to a Purchased Contract,
as in effect immediately prior to the Closing (without giving effect to any waiver, amendment,
release or modification occurring following Closing), and (II) to the extent that Seller would
otherwise be required to indemnify any Buyer Indemnified Person for the entire amount of Losses
(subject to Section 11.2(b) and the other provisions of this Article XI) due to
such misappropriation, infringement or unlawful use and is not relieved of such obligation pursuant
to this clause (A)(1) because the specifications, designs, design or specification changes, methods
or processes of design or manufacturing (and changes thereto) were required by Seller (subject to
paragraphs (B)-(G) below), Seller will (subject to Section 11.2(b) and the other provisions
of this Article XI) indemnify such Buyer Indemnified Person for fifty percent (50%) of the
amount of such Losses attributable to such misappropriation, infringement or
unlawful use in the event that (x) the provisions of the Purchased Contract providing for
indemnification or other right to recovery with respect to such misappropriation, infringement or
unlawful use of Intellectual Property rights have expired post-Closing under the terms of such
Purchased Contract (as in effect immediately prior to the Closing) or (y) such Purchased Contract
is unilaterally terminated by such supplier or performance of such indemnification and other
provisions giving rise to such recovery are excused and, as a result, the applicable intellectual
property indemnification provision(s) and the other provisions giving rise to such recovery are
terminated or excused, unless (i) any Buyer Indemnified Person breaches such Purchased Contract
following the Closing and such breach is determined by an arbitrator or court of competent
jurisdiction or by agreement of such Buyer Indemnified Person and Seller to be a basis for such
termination or excused performance or (ii) no Claim for indemnification is tendered to such
supplier prior to such supplier’s notification to any Buyer Indemnified Person of such termination
or Claim of excused performance and one of the following two conditions is satisfied: (a) such
termination or Claim of excused performance (1) was induced by any Buyer Indemnified Person through
a threatened breach or termination of the applicable Purchased Contract or (2) occurred following a
proposal by any Buyer Indemnified Person to modify the terms of such Purchased Contract (including
pricing or work scope) in a manner that has a material and adverse net economic effect on such
supplier; or (b) the work scope, pricing or other material terms have been modified from the terms
existing in the applicable Purchased Contract as of immediately prior to the Closing, in which case
Seller shall have no obligation to



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indemnify any Buyer Indemnified Person hereunder.
Notwithstanding the foregoing, in the circumstance in which the Buyer Indemnified Persons are not
entitled to indemnification for misappropriation, infringement or unlawful use of Intellectual
Property rights as a result of the operation of clause (I) of the proviso of the immediately
preceding sentence, if any Buyer Indemnified Person has used reasonable best efforts (which shall
in all events include filing and pursuing arbitration or litigation to final award or judgment) to
collect the indemnification owed by any such supplier pursuant to such Purchased Contract and is
not able to recover one hundred percent (100%) of the amount of the award or judgment against such
supplier, Seller will (subject to Section 11.2(b) and the other provisions of this
Article XI) indemnify such Buyer Indemnified Person for fifty percent (50%) of the amount
of such shortfall in such recovery by such Buyer Indemnified Person. In addition, if, in such
circumstance, such Buyer Indemnified Person and such supplier reach a proposed written settlement
in an amount less than one hundred percent (100%) of the indemnification claim and Seller has
consented to such settlement (which consent may be withheld in Seller’s sole discretion), then
Seller will (subject to Section 11.2(b) and the other provisions of this Article
XI) indemnify such Buyer Indemnified Person for fifty percent (50%) of the amount of such
shortfall in such recovery by such Buyer Indemnified Person;




                    (2) with respect to a Claim brought by a supplier to the Business for misappropriation,
infringement or unlawful use of Intellectual Property rights to the extent attributable to
Intellectual Property or Products delivered by, or other activities of, such supplier (a
“Supplier Infringement Claim”), except to the extent such misappropriation, infringement or
unlawful use arises out of or results from Seller’s failure to flow down the 787 Supply Agreement
Intellectual Property provisions to such supplier pursuant to the terms of the 787 Supply Agreement
(or include in the relevant Purchased Contract substantially comparable Intellectual Property
provisions); provided that at the time of such Supplier Infringement Claim, such supplier
remains a supplier to the Business, with work scope, pricing and other material
terms substantially equivalent in the aggregate to those that are set forth in the applicable
Purchased Contract, as in effect immediately prior to the Closing. Notwithstanding the foregoing,
with respect to any Supplier Infringement Claim for which the Buyer Indemnified Persons are
entitled to indemnification, Seller will (subject to Section 11.2(b) and the other
provisions of this Article XI) indemnify any Buyer Indemnified Person for fifty percent
(50%) of the amount of such Losses attributable to the misappropriation, infringement or unlawful
use giving rise to such Supplier Infringement Claim to the extent (i) any Buyer Indemnified Person
breaches the applicable Purchased Contract following the Closing and such breach is determined
(either by an arbitrator or court of competent jurisdiction or by agreement of such Buyer
Indemnified Person and Seller) to be a basis for such Supplier Infringement Claim, (ii) such
Supplier Infringement Claim (x) was induced by any Buyer Indemnified Person through a threatened
breach or termination of the applicable Purchased Contract or (y) occurred following proposal by
any Buyer Indemnified Person to modify the terms of the applicable Purchased Contract (including
pricing or work scope) in a manner that has a material and adverse net economic effect on such
supplier or (iii) the work scope, pricing or other material terms have been modified from the terms
in the applicable Purchased Contract as of immediately prior to the Closing. For purposes of this
Section 11.2(c), a Buyer Indemnified Person’s failure to cure an alleged pre-Closing breach
by Seller of a Purchased Contract or the failure to modify Seller’s pre-Closing conduct that
resulted in a pre-Closing breach shall not constitute a breach of such Purchased Contract by such
Buyer Indemnified Person following the Closing. Seller will



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(subject to Section 11.2(b)
and the other provisions of this Article XI) indemnify any Buyer Indemnified Person for
fifty percent (50%) of the amount of Losses incurred by such Buyer Indemnified Person attributable
to any misappropriation, infringement or unlawful use giving rise to a Supplier Infringement Claim
to the extent that Seller did flow down the 787 Supply Agreement Intellectual Property provisions
required to be flowed down by the 787 Supply Agreement (or included in the relevant Purchased
Contract substantially comparable Intellectual Property provisions) but a pre-Closing breach of
such Purchased Contract by Seller rendered such provisions unenforceable as determined by an
arbitrator or court of competent jurisdiction or by agreement of such Buyer Indemnified Person and
Seller. To the extent that Seller did flow down the 787 Supply Agreement Intellectual Property
provisions required to be flowed down by the 787 Supply Agreement (or include in the relevant
Purchased Contract substantially comparable Intellectual Property provisions) and did not breach
such Purchased Contract, Seller will not be required to indemnify any Buyer Indemnified Person
hereunder;




               (B) to the extent attributable to any specification (subject to paragraph (F) below), design,
design or specification change or any method or process of design or manufacturing (and changes
thereto) Required by Boeing;



               (C) to the extent attributable to Boeing’s collaboration in the specific aspect of the
specification (subject to the proviso in paragraph (F) below), design, design or specification
change or any method or process of design or manufacturing (or change thereto) that is a direct
cause of such misappropriation, infringement or unlawful use and such misappropriation,
infringement or unlawful use is attributable to such specific aspect that resulted from such
collaboration, in which case Seller will (subject to Section 11.2(b) and the other
provisions of this Article XI) indemnify the Buyer Indemnified Person for fifty percent
(50%) of the amount of such Losses attributable to such misappropriation, infringement or unlawful
use;



               (D) to the extent attributable to the use or sale of such Product, Covered Product or Supplied
Product in combination with other items when such misappropriation, infringement or unlawful use
would not have occurred but for such combination, except where such combination is contemplated by
the 787 Supply Agreement or is reasonably contemplated by the Parties given the intended use of
such item;



               (E) owned by any Buyer Indemnified Person other than consultants of Boeing or its Affiliates;



               (F) to the extent attributable to a design of Seller, if such misappropriation, infringement
or unlawful use could not be avoided as a result of the specifications Required by Boeing;
provided, however, that (i) to the extent such misappropriation, infringement or
unlawful use could have been avoided through the use of commercially reasonable efforts by Seller,
Seller will (subject to Section 11.2(b) and the other
provisions of this Article XI) indemnify the Buyer Indemnified Person for such Losses attributable to such
misappropriation, infringement or unlawful use and (ii) to the extent such misappropriation,
infringement or unlawful use could have been avoided through the use of all efforts by Seller,
Seller will (subject to Section 11.2(b) and the other provisions of this Article
XI)



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indemnify the Buyer Indemnified Person for fifty percent (50%) of the amount of such Losses
attributable to such misappropriation, infringement or unlawful use; or




               (G) to the extent such misappropriation, infringement or unlawful use would not have occurred
if Seller had signed the applicable Contract, as noted as unsigned on Schedule 2.2(a)(i).



          (d) All amounts agreed to by the Parties or determined by a court of competent jurisdiction to
be owing under this Section 11.2 shall be paid promptly by Seller through wire transfer of
immediately available funds to the account designated in writing by each Buyer Indemnified Person
or Buyer Indemnified Person entitled to such payment.




     Section 11.3 Indemnification by Buyer.



          (a) Buyer hereby agrees (subject to the terms of this Article XI) to indemnify, defend
and hold harmless Seller and its Affiliates, equityholders, officers, directors, managers,
members, employees and Representatives (collectively, the “Seller Indemnified Persons” and
together with Buyer Indemnified Persons, the “Indemnified Persons”) for, from and against
any and all Losses imposed upon or incurred by Seller Indemnified Persons, or any of them, to the
extent arising out of or resulting from any and all of the following (whether or not arising out of
any Third Party Claims): (i) any inaccuracy as of the Closing Date in, or any breach of, any
representation or warranty contained in Article V of this Agreement; (ii) any breach by
Buyer of, or any failure by Buyer to perform or comply with, any covenant or agreement contained in
this Agreement; and (iii) (A) any of the Assumed Liabilities (including as a result of a failure
for them to be satisfied when due) and (B) any Liabilities under the Site Development and Incentive
Agreement as a result of the failure to obtain a consent to transfer. For the avoidance of doubt,
the Parties acknowledge and agree that (x) the assumption by Buyer of the Assumed Liabilities
and any Liabilities under the Site Development and Incentive Agreement as a result of the
failure to obtain a consent to transfer shall not negate or diminish Buyer’s (or, if applicable, a
Buyer Indemnified Person’s) indemnification rights set forth in Section 11.2 of this
Agreement and (y) Section 11.3(a)(iii)(B) does not modify Section 2.3(b).




          (b) Buyer shall pay all amounts agreed to by the Parties or determined by a court of competent
jurisdiction to be owing under this Section 11.3 by wire transfer of immediately available
funds to the account designated in writing by each Seller Indemnified Person entitled to such
payment.




     Section 11.4 Third Party Claims. The obligations and Liabilities of Buyer and Seller
in connection with their respective indemnities pursuant to this Article XI, resulting from
any Claim or other assertion of Liability by a third party (a “Third Party Claim”), shall
be subject to the following terms and conditions:



          (a) The Indemnified Person seeking indemnification under this Article XI must give the
Party from whom indemnification is sought (the “Indemnifying Person”) notice of any Third
Party Claim that is asserted against, imposed upon or incurred by the Indemnified Person and that
may give rise to Liability of the Indemnifying Person pursuant to this Article XI, stating
(to the extent known or reasonably anticipated) the nature and basis of such Third Party



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Claim and
the amount thereof; provided that the failure to give such notice shall not affect the
rights of the Indemnified Person hereunder except to the extent that the Indemnifying Person shall
have been actually and materially prejudiced by reason of such failure.




          (b) Subject to Section 11.4(c) below, if the Indemnifying Person’s reasonable
estimated monetary exposure (whether in such Third Party Claim or as a result thereof) arising out
of such Third Party Claim is reasonably expected to exceed the Indemnified Person’s reasonable
estimated monetary exposure (whether in such Third Party Claim or as a result thereof) arising out
of such Third Party Claim after taking into account all of the claims and causes of action (and
underlying facts and circumstances) upon which such Third Party Claim is premised, and the
indemnification obligations of the Indemnifying Person and limits thereon hereunder (as determined
in good faith at the outset of such claim by mutual consultation and negotiation between the
Indemnifying Person and the Indemnified Person), then the Indemnifying Person shall have the right
to undertake, by counsel or other Representatives of its own choosing (which shall be reasonably
satisfactory to the Indemnified Person), subject to Section 11.2(b), the defense of such
Third Party Claim at the Indemnifying Person’s sole expense and, subject to Section
11.4(d), settle or compromise such Third Party Claim.




          (c) In the event that (i) the Indemnifying Person shall elect not to undertake such defense;
(ii) the Indemnifying Person shall fail to undertake to defend such Third Party Claim, or
diligently pursue or maintain such defense, within thirty (30) days after delivery of notice by the
Indemnified Person of such Third Party Claim; (iii) such Third Party Claim seeks non-monetary
relief or involves criminal allegations against a Party; or (iv) the Indemnified Person reasonably
concludes that the Indemnifying Person and Indemnified Person have conflicting interests with
respect to such Third Party Claim (it being understood that a relationship with a supplier shall
not constitute a conflicting interest), then the Indemnified
Person (upon further notice to the Indemnifying Person) shall have the right to undertake the
defense, compromise and/or settlement of such Third Party Claim, by counsel or other
Representatives of its own choosing; provided, that with respect to a Third Party Claim
seeking non-monetary relief, the Indemnifying Person shall have the right to employ separate legal
counsel and to participate in (but not control) the defense thereof, but the fees and expenses of
such legal counsel shall be at the expense of the Indemnifying Person; and provided
further that the Indemnified Person shall not compromise or settle such Third Party Claim
or consent to the entry of any Order with respect to such Third Party Claim without the consent of
the Indemnifying Person (which consent shall not be unreasonably withheld, conditioned or delayed).




          (d) Anything in this Section 11.4 to the contrary notwithstanding, the Indemnifying
Person shall not, without the Indemnified Person’s written consent (which consent shall not be
unreasonably withheld, conditioned or delayed), settle or compromise any Third Party Claim or
consent to the entry of any Order with respect to such Third Party Claim unless (i) the
Indemnifying Person agrees in writing to pay all amounts payable pursuant to such settlement,
compromise or Order as provided in this Agreement, (ii) such settlement, compromise or Order
includes as an unconditional term thereof the giving by the claimant or the plaintiff to the
Indemnified Person of an irrevocable release from all Liability in respect of such Third Party
Claim in form and substance satisfactory to the Indemnified Person, (iii) such settlement,
compromise or Order would not result in the finding or admission of any violation of



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Law, and
(iv) such settlement, comprise or Order does not impose any injunctive relief or operational
restrictions on the Indemnified Person or admit to any wrongdoing by or on behalf of the
Indemnified Person.




          (e) The Parties agree that any settlement described in Schedule 11.4(e) shall be
managed as described thereon.




     Section 11.5 Limitations on Indemnification Liability.



          (a) Losses Net of Insurance Proceeds and Other Third-Party Recoveries.
Notwithstanding any provision in this Agreement to the contrary, all Losses for which any
Indemnified Person would otherwise be entitled to indemnification under this Article XI
shall be reduced by the amount of insurance proceeds, indemnification payments and other
third-party recoveries to which any Indemnified Person receives in respect of any Losses incurred
by such Indemnified Person, in each case after deducting the out-of-pocket costs and expenses
incurred following Closing in connection with such Loss and obtaining such proceeds, payments or
recoveries, including any incremental insurance premium costs incurred by such Party;
provided that in the case of any such incremental insurance premium costs, the Indemnified
Person shall provide the Indemnifying Person with a written statement from its insurance carrier
specifically allocating the increase in premium costs directly to the claims for which
indemnification is sought. In the event any Indemnified Person is entitled to any insurance
proceeds, indemnity payments or any third-party recoveries in respect of any Losses for which such
Indemnified Person is entitled to indemnification pursuant to this Article XI, such
Indemnified Person shall use commercially reasonable efforts to obtain or receive such proceeds,
payments or recoveries;
provided that this Section 11.5(a) shall not require any Indemnified Person to
initiate, engage in or threaten litigation with any Person, including any of its insurance
carriers. In the event that any such insurance proceeds, indemnity payments or other third-party
recoveries are received by an Indemnified Person subsequent to receipt by such Indemnified Person
of any indemnification payment hereunder in respect of the claims to which such insurance proceeds,
indemnity payments or other third-party recoveries relate, appropriate refunds shall be made
promptly by the relevant Indemnified Person of the relevant portion of such indemnification
payment.




          (b) Tax Benefits. Notwithstanding any provision in this Agreement to the contrary,
all indemnification payments for Losses under this Article XI shall be paid by the
Indemnifying Person without reduction for any Tax Benefits (as defined below) available to the
Indemnified Person. However, to the extent that an Indemnified Person recognizes Tax Benefits in
respect of any Losses for which such Indemnified Person is entitled to indemnification under this
Article XI, the Indemnified Person shall pay promptly to the Indemnifying Person an amount
in cash equal to the amount of such Tax Benefits (but not in excess of the indemnification payment
or payments actually received from the Indemnifying Person with respect to such Losses) as such Tax
Benefits are actually recognized by the Indemnified Person. The Indemnified Person shall provide a
statement, signed by an officer of the Indemnified Person, setting forth in reasonable detail the
calculation of Tax Benefits recognized (even if no such Tax Benefits are recognized) at the
following times: (i) no later than one hundred and twenty (120) days after the close of each
calendar year after an indemnification payment has been made to such Indemnified Person under this
Article XI and (ii) accompanying each payment of Tax Benefits realized by such Indemnified
Person under this Section 11.5(b). In the event the



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Indemnifying Person objects to the
calculation of Tax Benefits recognized, it shall deliver written notice of objection (the “Tax
Benefit Objection Notice”) to the Indemnified Person not more than forty-five (45) days after
the Indemnifying Person’s receipt of the calculation. The Indemnified Person and the Indemnifying
Person shall promptly endeavor in good faith to resolve the issues related to calculation of Tax
Benefits recognized, including through the provision of information reasonably requested by the
other party in order to review the calculation of Tax Benefits recognized. In the event such
parties are unable to resolve the issues within forty-five (45) days after the issuance of the Tax
Benefit Objection Notice, the resolution of the calculation of Tax Benefits recognized shall be
submitted to a nationally recognized public accounting firm mutually agreed upon by the
Indemnifying Person and the Indemnified Person (the “Arbitrator”). The Indemnifying Person
and the Indemnified Person shall each use commercially reasonable efforts to cause the Arbitrator
to review the calculation of Tax Benefits recognized and related documents and records necessary to
support such calculation and determine the Tax Benefits recognized by the Indemnified Person within
forty-five (45) days after the submission of the calculation to the Arbitrator. The decision of
the Arbitrator shall be final and binding upon the parties and shall be non-appealable. Upon
determination of the Tax Benefits recognized by the Arbitrator, the Indemnified Person shall pay
promptly to the Indemnifying Person the amount of any increase, if any, in the amount of Tax
Benefits recognized as calculated by the Arbitrator over the amount calculated by the Indemnified
Person. The fees of the Arbitrator shall be borne 50% by the Indemnifying Person and 50% by the
Indemnified Person. For this purpose, the Indemnified Person shall be deemed to recognize a tax
benefit (“Tax Benefit”) with respect to a taxable year if, and to the extent that, the
Indemnified Person’s cumulative liability for Income Taxes through the end of such taxable year,
calculated by excluding any Income Tax items attributable to the Losses from all taxable years,
exceeds the
Indemnified Person’s actual cumulative Income Tax liability through the end of such taxable
year, calculated by taking into account any Income Tax items attributable to the Losses for all
taxable years as provided for by the relevant Income Tax law.




          (c) Consequential; Punitive and Other Special Damages. Notwithstanding any provision
in this Agreement to the contrary, no Indemnified Person shall be entitled to indemnification for
consequential, punitive, indirect or special damages (other than for any such damages that the
Indemnified Person is, or has been, required to pay in respect of any Third Party Claim that is
subject to such claim of indemnification).




     Section 11.6 Treatment of Indemnification Payments. All amounts paid pursuant to this
Article XI shall be treated as adjustments to the Aggregate Consideration.



     Section 11.7 Exclusive Remedy. Notwithstanding anything contained in this Agreement
to the contrary, except (a) in the case of fraud, (b) for injunctive or provisional relief and
(c) as contemplated by Section 3.4, after the Closing, indemnification pursuant to the
provisions of this Article XI shall be the sole and exclusive remedy for the Parties for
monetary damages for any inaccuracy or breach of any representation, warranty, covenant or other
provision contained in this Agreement or in any certificate delivered pursuant hereto.



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ARTICLE XII




GENERAL PROVISIONS




     Section 12.1 Notices. All notices and other communications given or made pursuant
hereto shall be in writing and shall be deemed to have been duly given or made as of the date
delivered if delivered personally, mailed by registered or certified mail (postage prepaid, return
receipt requested) or sent by overnight courier (providing proof of delivery) to the Parties at the
following addresses or as of the date transmitted if sent by electronic transmission to the
following facsimile numbers or electronic mail addresses (or at such other address, electronic mail
address or facsimile number for a Party as shall be specified by like notice):



     If to Seller:



Vought Aircraft Industries, Inc.

9314 W. Jefferson Street

Dallas, TX 75211

Attention: General Counsel, Kevin McGlinchey

Facsimile: (972) 946-5642




     With a copy (which shall not constitute notice) to:



Latham & Watkins LLP

555 Eleventh Street, NW

Suite 1000

Washington, DC 20004

Attention: Daniel T. Lennon

Paul F. Sheridan, Jr.

Facsimile: (202) 637-2201




     If to Buyer:



BCACSC, Inc.

c/o The Boeing Company

100 N. Riverside Drive

Chicago, IL 60606

Attention: Vice President, Corporate and Strategic
Development

Facsimile: (312) 777-2885




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BCACSC, Inc.

c/o The Boeing Company

100 N. Riverside Drive

Chicago, IL 60606

Attention: Executive Vice President and General Counsel

Facsimile: (312) 544-2121




BCACSC, Inc.

c/o The Boeing Company

P.O. Box 3707 MC 09-20

Seattle, WA 98124-2207

Attention: Vice President, Supply Chain Strategy,

Commercial Airplanes

Facsimile: (425) 717-7800




     With a copy (which shall not constitute notice) to:



Kirkland & Ellis LLP

300 North LaSalle Street

Chicago, IL 60654

Facsimile: (312) 862-2200

Attention: Stephen Fraidin

                  R. Scott Falk, P.C.




     Section 12.2 Severability; Specific Enforcement. If any provision of this Agreement
or the application of any provision hereof to any circumstances is held invalid, unenforceable, or
otherwise illegal, the remainder of the
Agreement and the application of such provision to other circumstances shall not be affected,
and the provisions so held to be invalid, unenforceable, or otherwise illegal shall be reformed to
the extent (and only to the extent) necessary to make it enforceable, valid and legal. Upon any
such determination that any term or other provision is invalid, illegal or incapable of being
enforced, the Parties shall negotiate in good faith to modify this Agreement so as to effect the
original intent of the Parties as closely as possible in an acceptable manner to the end that the
transactions contemplated hereby are fulfilled to the extent possible. Each Party acknowledges and
agrees that the other Party may be damaged irreparably in the event that any of the provisions of
this Agreement are not performed in accordance with their specific terms or otherwise are breached.
Accordingly, each Party agrees that (A) the other Party may be entitled, in addition to other
rights or remedies existing in its favor, to injunctive or other relief to prevent breaches of the
provisions of this Agreement and to enforce specifically this Agreement and the terms and
provisions hereof, in each case without the requirement of posting a bond or proving actual damages
(which requirements the other Party shall waive) and (B) each Party hereby agrees that such Party
shall not, in connection with any action brought to specifically enforce a Party’s rights or
obligations under this Agreement, assert, plead or argue that such remedy is unavailable, or
otherwise oppose the imposition of such a remedy, on the grounds that money damages are an adequate
remedy for the alleged breach of this Agreement.



     Section 12.3 Amendments. No amendment, supplement or modification of this Agreement
shall be effective unless in writing signed by all of the Parties.



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     Section 12.4 Assignment; Beneficiaries. Neither this Agreement nor any of the rights,
interests or obligations hereunder shall be assigned or delegated by any of the Parties (whether by
merger, operation of Law or otherwise) without the prior written consent of the other Parties and
any purported assignment in violation of this Section 12.4 shall be void; provided
that (i) Seller may collaterally assign its rights under this Agreement as security for
Indebtedness and related obligations of Seller under the Seller Senior Credit Agreement or
otherwise and (ii) either Party may, without the prior written consent of the other Parties, assign
and delegate any of their rights (including Buyer’s right to acquire the Purchased Intellectual
Property) hereunder to any Affiliate; provided that no such assignment shall relieve Seller
or Buyer of any of their respective obligations or Liabilities hereunder. Subject to the preceding
sentence, this Agreement shall be binding upon, inure to the benefit of and be enforceable by the
Parties and their respective successors and assigns, and nothing in this Agreement, express or
implied, other than the rights of Buyer Indemnified Persons and Seller Indemnified Persons pursuant
to Article XI, is intended to or shall confer upon any other Person any right, benefit or
remedy of any nature whatsoever under or by reason of this Agreement. Notwithstanding the
foregoing, nothing in this Agreement, express or implied, is intended to confer upon any
Transferred Employees any right, benefit or remedy of any nature whatsoever under or by reason of
Article VIII hereof.



     Section 12.5 Counterparts; Facsimiles . This Agreement may be executed and delivered in one or more counterparts, and by the
different Parties in separate counterparts, each of which when executed and delivered shall be
deemed to be an original but all of which taken together shall constitute one and the same
agreement. Exchange and delivery of this Agreement by exchange of facsimile copies or other
electronic copies bearing the signature of a Party shall constitute a valid and binding execution
and delivery of this Agreement by such Party. Such facsimile or other electronic copies shall
constitute legally enforceable original documents.



     Section 12.6 Descriptive Headings. The descriptive headings of this Agreement are
inserted for convenience only and do not constitute a part of this Agreement.



     Section 12.7 Governing Law; Forum Selection. This Agreement and all disputes arising
out of or relating hereto shall be governed by and construed in accordance with the Laws of the
State of Delaware applicable to contracts made and performed entirely with the State of Delaware,
without giving effect to any Laws or principles of conflicts of laws that would cause the Laws of
any other jurisdiction to apply. Each Party hereby (a) submits to the exclusive jurisdiction of
any state or federal court sitting in the State of Delaware (the “Chosen Courts”) in any
Legal Proceeding arising out of or relating to this Agreement, (b) agrees that all Claims in
respect of such Legal Proceeding may be heard and determined only in any such Chosen Court,
(c) hereby waives any Claim of inconvenient forum or other challenge to venue in such Chosen Court,
and (d) agrees not to bring any Legal Proceeding arising out of or relating to this Agreement
before any Governmental Entity other than the Chosen Courts.



     Section 12.8 WAIVER OF JURY TRIAL. EACH PARTY HEREBY WAIVES, TO THE MAXIMUM EXTENT
PERMITTED BY APPLICABLE LAW, TRIAL BY JURY IN ANY PROCEEDING IN ANY COURT WITH RESPECT TO, IN
CONNECTION WITH OR ARISING OUT OF THIS AGREEMENT, OR THE VALIDITY, PROTECTION, INTERPRETATION,
COLLECTION OR ENFORCEMENT THEREOF, WHETHER



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PURPORTING TO BE AT LAW OR IN EQUITY, AND WHETHER
SOUNDING IN CONTRACT, TORT OR OTHERWISE.



     Section 12.9 Entire Agreement. This Agreement and the other Transaction Documents
constitute the final, exclusive and entire agreement of the Parties, and all prior and
contemporaneous agreements and undertakings, both written and oral, among the Parties, or any of
them, with respect to the subject matter hereof (including the LOI) are expressly merged into and
superseded by this Agreement and the other Transaction Documents. There are no conditions
precedent to the effectiveness of this Agreement other than those expressly stated in this
Agreement.



     Section 12.10 Waivers . Any failure by any Party to comply with any obligation, covenant, agreement or condition
herein may be waived by the Party entitled to the benefits thereof only by a written instrument
signed by the Party granting such waiver, but such waiver or failure to insist upon strict
compliance with such obligation, covenant, agreement or condition shall not operate as a waiver of,
or estoppel with respect to, any subsequent or other failure to comply.



     Section 12.11 NO ADDITIONAL REPRESENTATION OR WARRANTIES. EXCEPT AS PROVIDED IN
ARTICLE IV, NEITHER SELLER, NOR ANY OF ITS AFFILIATES, NOR ANY OF THEIR RESPECTIVE
DIRECTORS, OFFICERS, EMPLOYEES, STOCKHOLDERS, PARTNERS, MEMBERS OR REPRESENTATIVES HAS MADE, OR IS
MAKING, ANY REPRESENTATION OR WARRANTY WHATSOEVER TO BUYER WITH RESPECT TO THE TRANSACTIONS
CONTEMPLATED BY THIS AGREEMENT AND NO SUCH PARTY SHALL BE LIABLE IN RESPECT OF THE ACCURACY OR
COMPLETENESS OF ANY INFORMATION PROVIDED TO BUYER WITH RESPECT TO THE TRANSACTIONS CONTEMPLATED BY
THIS AGREEMENT. WITHOUT LIMITING THE FOREGOING, BUYER ACKNOWLEDGES THAT BUYER, TOGETHER WITH ITS
ADVISORS, HAS MADE ITS OWN INVESTIGATION OF THE BUSINESS, THE PURCHASED ASSETS AND THE ASSUMED
LIABILITIES AND IS NOT RELYING ON ANY IMPLIED WARRANTIES OR UPON ANY REPRESENTATION OR WARRANTY
WHATSOEVER AS TO THE PROSPECTS (FINANCIAL OR OTHERWISE) OR THE VIABILITY OR LIKELIHOOD OF SUCCESS
OF THE BUSINESS AS CONDUCTED AFTER THE CLOSING. FOR THE PURPOSES HEREIN, ANY INFORMATION PROVIDED
TO, OR MADE AVAILABLE TO, BUYER BY SELLER SHALL INCLUDE ANY AND ALL INFORMATION THAT MAY BE
CONTAINED OR POSTED IN ANY ELECTRONIC DATA ROOM ESTABLISHED BY SELLER OR ITS REPRESENTATIVES IN
CONNECTION WITH THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT.



     Section 12.12 Disclosure Schedules. Unless the context otherwise requires, all
capitalized terms used in the Disclosure Schedule shall have the respective meanings assigned in
this Agreement. No reference to or disclosure of any item or other matter in the Disclosure
Schedule shall be construed as an admission or indication that such item or other matter is
material or outside the ordinary course of business or that such item or other matter is required
to be referred to or disclosed in the Disclosure Schedule. No disclosure in the Disclosure
Schedule relating to any possible breach or violation of any agreement, Law or regulation
shall be



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construed as an admission or indication that any such breach or violation exists or has actually
occurred. No exceptions to any representations or warranties disclosed in one particular Schedule
shall constitute an exception to any other representations or warranties made in this Agreement
unless the exception is disclosed as provided herein on each such other applicable Schedule or
cross-referenced in such other applicable Schedule or unless the applicability of such exception to
another Schedule is apparent on its face.



     Section 12.13 No Recourse . Except as set forth in the Boeing Guaranty, this Agreement may only be enforced against,
and any claim or cause of action based upon, arising out of, or related to this Agreement may only
be brought against the entities that are expressly named as Parties and then only with respect to
the specific obligations set forth herein with respect to such Party. Except as set forth in the
Boeing Guaranty, except to the extent a named Party to this Agreement (and then only to the extent
of the specific obligations undertaken by such named Party in this Agreement and not otherwise), no
past, present or future director, officer, employee, incorporator, member, partner, stockholder,
Affiliate, agent, attorney or their respective Affiliates shall have any Liability (whether in
contract or tort) for any one or more of the representations, warranties, covenants, agreements or
other obligations or Liabilities of any one or more of Seller or Buyer under this Agreement
(whether for indemnification or otherwise) of or for any claim based on, in respect of, or by
reason of, the transactions contemplated by this Agreement and the Transaction Documents. Nothing
in this Section 12.13 shall in any way limit the obligations of Boeing or the rights of
Seller under the Boeing Guaranty.



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SIGNATURE PAGE FOLLOWS]




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     IN WITNESS WHEREOF, the undersigned have executed and delivered, or have caused this Agreement
to be duly executed and delivered, as of the date first set forth herein.



	 	 	 	 	 
	 	 	SELLER
	 
	 	 	 	 
	 	 	VOUGHT AIRCRAFT INDUSTRIES, INC.
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Keith B. Howe
	 

	 	 	 	 
	 

	 	Name:
	 	Keith B. Howe
	 

	 	Title:	 	 
	 
	 	 	 	 
	 	 	BUYER
	 
	 	 	 	 
	 	 	BCACSC, INC.
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Bryan Gerard
	 

	 	 	 	 
	 

	 	Name:
	 	Bryan Gerard
	 

	 	Title: