Exhibit 4.1


 


 


PURCHASE
AND SALE AGREEMENT


 


among


 


UNOVA, INC.


 


UNOVA INDUSTRIAL AUTOMATION SYSTEMS, INC.


 


UNOVA U.K. LIMITED (Reg. No. 1218921)


 


CINCINNATI MACHINE U.K. LIMITED (Reg. No. 3256777)


 


HONSBERG LAMB
SONDERWERKZEUGMASCHINEN GMBH


 


UNOVA CANADA, INC.


 


UNOVA IP CORP.


 


and


 


R&B PLASTICS HOLDINGS, INC.


 


MAG INDUSTRIAL AUTOMATION SYSTEMS, LLC


 


Dated:  March 17, 2005


 





















 


CONTENTS


 


	
  ARTICLE 1. The Transactions

  	
   

  
	
  1.1

  	
  Transfer of Assets

  	
   

  
	
  1.2

  	
  Excluded
  Assets

  	
   

  
	
  1.3

  	
  Transfers of Shares

  	
   

  
	
   

  	
  (a)

  	
  Transfer of CM Korea Shares

  	
   

  
	
   

  	
  (b)

  	
  Transfer of UII Shares

  	
   

  
	
   

  	
  (c)

  	
  Transfer of R&B Shares

  	
   

  
	
  1.4

  	
  Consideration

  	
   

  
	
  1.5

  	
  Purchase Price and Payment

  	
   

  
	
   

  	
  (a)

  	
  Purchase Price

  	
   

  
	
   

  	
  (b)

  	
  Payment of Purchase Price

  	
   

  
	
   

  	
   

  	
  (i)

  	
  Cash Payment

  	
   

  
	
   

  	
   

  	
  (ii)

  	
  Secured Note

  	
   

  
	
   

  	
  (c)

  	
  Allocation of Consideration

  	
   

  
	
   

  	
   

  	
  (i)

  	
  Section 1060 Allocation

  	
   

  
	
   

  	
   

  	
  (ii)

  	
  Section 338 Allocation

  	
   

  
	
   

  	
   

  	
  (iii)

  	
  Section 56.4 Election

  	
   

  
	
   

  	
   

  	
  (iv)

  	
  Section 167 Election

  	
   

  
	
   

  	
   

  	
  (v)

  	
  Section 22 Election

  	
   

  
	
  1.6

  	
  Assumed Liabilities

  	
   

  
	
  1.7

  	
  Excluded Liabilities

  	
   

  
	
  1.8

  	
  Closing Balance Sheet

  	
   

  
	
   

  	
  (a)

  	
  Cincinnati
  Lamb Group December Balance Sheets

  	
   

  
	
   

  	
  (b)

  	
  Preliminary Closing
  Balance Sheet

  	
   

  
	
   

  	
  (c)

  	
  Review of
  Preliminary Closing Balance Sheet

  	
   

  
	
   

  	
  (d)

  	
  Finalization of
  Closing Balance Sheet

  	
   

  
	
   

  	
  (e)

  	
  Net Working Assets

  	
   

  
	
  1.9

  	
  Right to Contest

  	
   

  
	
  1.10

  	
  Nonassignable
  Contracts and Rights

  	
   

  
	
  1.11

  	
  Power of Attorney

  	
   

  
	
  1.12

  	
  Bulk
  Sales

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 2. Closing and Transfer
  Date

  	
   

  
	
  2.1

  	
  Closing

  	
   

  
	
  2.2

  	
  Notice and Right to Cure

  	
   

  
	
  2.3

  	
  Reconciliation of Cash

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 3. Representations and
  Warranties of the Selling Entities

  	
   

  
	
  3.1

  	
  Corporate Matters

  	
   

  
	
   

  	
  (a)

  	
  Due
  Organization, Good Standing and Qualification

  	
   

  
	
   

  	
  (b)

  	
  Corporate
  Authority to Conduct Business

  	
   

  
	
   

  	
  (c)

  	
  Corporate
  Power and Authority to Enter Into Agreements

  	
   

  



 


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  (d)

  	
  Due Execution and
  Enforceability

  	
   

  
	
   

  	
  (e)

  	
  No Conflict

  	
   

  
	
   

  	
  (f)

  	
  Subsidiaries
  and Other Equity Investments

  	
   

  
	
   

  	
  (g)

  	
  Articles and By-laws

  	
   

  
	
   

  	
  (h)

  	
  Capitalization and
  Shareholders

  	
   

  
	
   

  	
  (i)

  	
  Amalgamation of UNOVA
  Canada

  	
   

  
	
  3.2

  	
  Financial

  	
   

  
	
   

  	
  (a)

  	
  December Financials

  	
   

  
	
   

  	
  (b)

  	
  Events
  Subsequent to December Balance Sheet

  	
   

  
	
   

  	
  (c)

  	
  Indebtedness

  	
   

  
	
  3.3

  	
  Accounts Receivable

  	
   

  
	
   

  	
  (a)

  	
  December Balance Sheet

  	
   

  
	
   

  	
  (b)

  	
  Closing Balance Sheet

  	
   

  
	
  3.4

  	
  Inventories

  	
   

  
	
  3.5

  	
  Absence of Liens and
  Encumbrances

  	
   

  
	
  3.6

  	
  Real
  Property

  	
   

  
	
   

  	
  (a)

  	
  Real Property

  	
   

  
	
   

  	
  (b)

  	
  Realty Leases (as Lessee)

  	
   

  
	
   

  	
  (c)

  	
  Violation of
  Laws or Restrictive Covenants

  	
   

  
	
   

  	
  (d)

  	
  Environmental Matters

  	
   

  
	
  3.7

  	
  Right to Use
  Properties and Assets

  	
   

  
	
  3.8

  	
  Contracts and Commitments

  	
   

  
	
   

  	
  (a)

  	
  Sales Orders, Bids and
  Proposals

  	
   

  
	
   

  	
  (b)

  	
  Purchase Orders

  	
   

  
	
   

  	
  (c)

  	
  Sales
  Representative, Distributor and Dealer Agreements

  	
   

  
	
   

  	
  (d)

  	
  Personal Property
  Leases (As Lessee)

  	
   

  
	
   

  	
  (e)

  	
  Noncompetition
  Agreements or Covenants

  	
   

  
	
   

  	
  (f)

  	
  Confidential
  Nondisclosure Agreements

  	
   

  
	
   

  	
  (g)

  	
  Consultant Agreements

  	
   

  
	
   

  	
  (h)

  	
  Guarantees

  	
   

  
	
   

  	
  (i)

  	
  Powers of Attorney, Proxies

  	
   

  
	
   

  	
  (j)

  	
  Letters
  of Credit, Surety, Bid and Performance Bonds

  	
   

  
	
   

  	
  (k)

  	
  Other Material Contracts

  	
   

  
	
  3.9

  	
  Patents,
  Trade Names, Trademarks, Service Marks, Copyrights and Chip Registrations

  	
   

  
	
   

  	
  (a)

  	
  Intellectual Property
  Rights

  	
   

  
	
   

  	
  (b)

  	
  Licenses
  of Intellectual Property Rights To or From Third Parties

  	
   

  
	
   

  	
  (c)

  	
  No Infringement

  	
   

  
	
  3.10

  	
  Patent,
  Trade Name, Trademark, Service Mark, Copyright or Chip Registration
  Indemnification

  	
   

  
	
  3.11

  	
  Confidential
  Information or Trade Secrets

  	
   

  
	
  3.12

  	
  Product and Service
  Warranties

  	
   

  
	
  3.13

  	
  Employees; Employee
  Benefits

  	
   

  



 


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  (a)

  	
  Employees

  	
   

  
	
   

  	
  (b)

  	
  Indebtedness to Employees

  	
   

  
	
   

  	
  (c)

  	
  Loans or Advances to
  Employees

  	
   

  
	
   

  	
  (d)

  	
  Collective Bargaining
  Agreements

  	
   

  
	
   

  	
  (e)

  	
  Other Labor Matters

  	
   

  
	
   

  	
  (f)

  	
  Employee Benefit Plans

  	
   

  
	
   

  	
   

  	
  (i)

  	
  Generally

  	
   

  
	
   

  	
   

  	
  (ii)

  	
  ERISA Plans

  	
   

  
	
   

  	
   

  	
  (iii)

  	
  U.K. Pension Plans

  	
   

  
	
   

  	
  (g)

  	
  Employment Contracts

  	
   

  
	
  3.14

  	
  Pending
  or Threatened Claims, Litigation and Governmental Proceedings

  	
   

  
	
  3.15

  	
  Judgments, Orders
  and Consent Decrees

  	
   

  
	
  3.16

  	
  Compliance With Laws

  	
   

  
	
  3.17

  	
  Franchises, Permits, Etc.

  	
   

  
	
  3.18

  	
  Taxes

  	
   

  
	
  3.19

  	
  Required Consents

  	
   

  
	
  3.20

  	
  No Breach of Statute
  or Contract

  	
   

  
	
  3.21

  	
  Insurance and Banking

  	
   

  
	
   

  	
  (a)

  	
  Insurance Policies

  	
   

  
	
   

  	
  (b)

  	
  Bank Accounts

  	
   

  
	
  3.22

  	
  Broker’s or Finder’s Fees

  	
   

  
	
  3.23

  	
  Duty of
  the Selling Entities to Make Inquiry

  	
   

  
	
  3.24

  	
  Affiliate Arrangements

  	
   

  
	
  3.25

  	
  Assets of Cincinnati
  Lamb Group

  	
   

  
	
  3.26

  	
  No
  Knowledge of Other Liabilities; No Other Representations

  	
   

  
	
   

  	
  (a)

  	
  No Knowledge of Other
  Liabilities

  	
   

  
	
   

  	
  (b)

  	
  Disclaimer
  of Other Representations and Warranties

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 4. Representations and
  Warranties of Mainco and Purchaser

  	
   

  
	
  4.1

  	
  Corporate Matters

  	
   

  
	
   

  	
  (a)

  	
  Due Organization

  	
   

  
	
   

  	
  (b)

  	
  Corporate
  Power and Authority to Enter Into Agreement

  	
   

  
	
   

  	
  (c)

  	
  Due Execution and
  Enforceability

  	
   

  
	
   

  	
  (d)

  	
  No Conflict

  	
   

  
	
  4.2

  	
  Required Consents

  	
   

  
	
  4.3

  	
  Claims,
  Litigation and Governmental Proceedings

  	
   

  
	
  4.4

  	
  Broker’s or Finder’s Fees

  	
   

  
	
  4.5

  	
  Subsidiaries

  	
   

  
	
  4.6

  	
  Solvency

  	
   

  
	
  4.7

  	
  Sources of Financing

  	
   

  
	
  4.8

  	
  WTO
  Investor

  	
   

  
	
  4.9

  	
  Ultimate Parent Entity

  	
   

  



 


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  ARTICLE 5. Certain Covenants
  Pending the Closing

  	
   

  
	
  5.1

  	
  Full
  Access

  	
   

  
	
  5.2

  	
  Carry On In Regular Course

  	
   

  
	
  5.3

  	
  Sales
  Orders

  	
   

  
	
  5.4

  	
  Capital Expenditures

  	
   

  
	
  5.5

  	
  No Increase in
  Compensation or Benefits

  	
   

  
	
  5.6

  	
  Consents

  	
   

  
	
   

  	
  (a)

  	
  HSR
  Act

  	
   

  
	
   

  	
  (b)

  	
  German Merger Control

  	
   

  
	
   

  	
  (c)

  	
  Korean Reports

  	
   

  
	
  5.7

  	
  Conditions Precedent

  	
   

  
	
  5.8

  	
  Environmental Survey

  	
   

  
	
   

  	
  (a)

  	
  Phase I and Phase II

  	
   

  
	
   

  	
  (b)

  	
  Environmental Response Plan

  	
   

  
	
  5.9

  	
  Nondisclosure by Purchaser

  	
   

  
	
  5.10

  	
  Status of Purchaser’s Financing

  	
   

  
	
  5.11

  	
  Reorganization of U.K. Pension Plans

  	
   

  
	
  5.12

  	
  Purchaser Subsidiaries

  	
   

  
	
  5.13

  	
  Planning Act (Ontario)

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 6.
  Conditions Precedent to the Obligations of the Purchasing Entities to Close

  	
   

  
	
  6.1

  	
  Representations and Warranties True

  	
   

  
	
  6.2

  	
  Compliance With Agreement

  	
   

  
	
  6.3

  	
  No Material Adverse Change; Net Working Capital

  	
   

  
	
  6.4

  	
  No Litigation

  	
   

  
	
  6.5

  	
  Proceedings and Instruments Satisfactory

  	
   

  
	
  6.6

  	
  Consents and Approvals

  	
   

  
	
  6.7

  	
  Instruments of Transfer

  	
   

  
	
  6.8

  	
  Resignations and Corporate Records

  	
   

  
	
  6.9

  	
  Transitional Services Agreement

  	
   

  
	
  6.10

  	
  Title Reports

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 7.
  Conditions Precedent to the Obligations of the Selling Entities to Close

  	
   

  
	
  7.1

  	
  Representations and Warranties True

  	
   

  
	
  7.2

  	
  Compliance With Agreement

  	
   

  
	
  7.3

  	
  No Litigation

  	
   

  
	
  7.4

  	
  Proceedings and Instruments Satisfactory

  	
   

  
	
  7.5

  	
  Consents and Approvals

  	
   

  
	
  7.6

  	
  Purchase Price

  	
   

  
	
  7.7

  	
  Instruments of Assumption

  	
   

  
	
  7.8

  	
  Performance Bonds

  	
   

  
	
  7.9

  	
  Transitional Services Agreements

  	
   

  
					



 


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  7.10

  	
  Consent of UNOVA’s Lender

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 8.
  Further Requirements

  	
   

  
	
  8.1

  	
  Access to Books and Records

  	
   

  
	
  8.2

  	
  Further Instruments and Assurances

  	
   

  
	
  8.3

  	
  Litigation Cooperation

  	
   

  
	
  8.4

  	
  Certain Employee Matters

  	
   

  
	
   

  	
  (a)

  	
  Employment

  	
   

  
	
   

  	
  (b)

  	
  Certain Employee Benefits

  	
   

  
	
   

  	
   

  	
  (i)

  	
  Past Service Credit

  	
   

  
	
   

  	
   

  	
  (ii)

  	
  Benefits
  under the Selling Entities’ Plans

  	
   

  
	
   

  	
   

  	
  (iii)

  	
  U.S. Medical and Health
  Plan

  	
   

  
	
   

  	
   

  	
  (iv)

  	
  Purchaser’s 401(k) Plan

  	
   

  
	
   

  	
   

  	
  (v)

  	
  U.K. Pension Plans

  	
   

  
	
   

  	
  (c)

  	
  Certain Retained
  Responsibility

  	
   

  
	
   

  	
  (d)

  	
  WARN Act

  	
   

  
	
   

  	
  (e)

  	
  Certain
  Agreements Regarding Severance

  	
   

  
	
   

  	
  (f)

  	
  Certain
  Agreements Regarding Personnel in Spain and France

  	
   

  
	
  8.5

  	
  Agreements Regarding Intellectual Property

  	
   

  
	
   

  	
  (a)

  	
  Use of UNOVA Name and Mark

  	
   

  
	
   

  	
  (b)

  	
  Industrial Automation
  Systems

  	
   

  
	
   

  	
  (c)

  	
  Certain Licensed
  Intellectual Property

  	
   

  
	
   

  	
   

  	
  (i)

  	
  Purchaser’s
  License of Licensed Intellectual Property

  	
   

  
	
   

  	
   

  	
  (ii)

  	
  Seller’s
  License of Licensed Intellectual Property

  	
   

  
	
  8.6

  	
  Exclusivity

  	
   

  
	
  8.7

  	
  Taxes

  	
   

  
	
   

  	
  (a)

  	
  Taxes
  Relating to the Business and the Transferred Subsidiaries

  	
   

  
	
   

  	
  (b)

  	
  Tax Returns

  	
   

  
	
   

  	
   

  	
  (i)

  	
  Consolidated Returns

  	
   

  
	
   

  	
   

  	
  (ii)

  	
  Separate Returns

  	
   

  
	
   

  	
  (c)

  	
  Tax Contests

  	
   

  
	
   

  	
  (d)

  	
  Cooperation

  	
   

  
	
   

  	
  (e)

  	
  Transfer Taxes

  	
   

  
	
   

  	
  (f)

  	
  Employment Taxes

  	
   

  
	
   

  	
  (g)

  	
  Section 338(h)(10) Elections

  	
   

  
	
   

  	
  (h)

  	
  Section 338(g) Election

  	
   

  
	
   

  	
  (i)

  	
  Interpretation

  	
   

  
	
   

  	
  (j)

  	
  Tax Treatment

  	
   

  
	
  8.8

  	
  Settlement of Intercompany Accounts

  	
   

  
	
  8.9

  	
  Cash of the Transferred Subsidiaries

  	
   

  
	
  8.10

  	
  Performance Bonds

  	
   

  



 


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  8.11

  	
  Name

  	
   

  
	
  8.14

  	
  Authorization; Mail

  	
   

  
	
  8.15

  	
  Post-Closing Cooperation

  	
   

  
	
  8.16

  	
  Cooperation Regarding U.K. Properties

  	
   

  
	
   

  	
  (a)

  	
  Definitions

  	
   

  
	
   

  	
  (b)

  	
  Matters
  Affecting the U.K. Properties

  	
   

  
	
   

  	
  (c)

  	
  Landlord’s Consents

  	
   

  
	
   

  	
  (d)

  	
  Completion

  	
   

  
	
   

  	
  (e)

  	
  Completion

  	
   

  
	
   

  	
  (f)

  	
  Assurances

  	
   

  
	
  8.17

  	
  Mexico VAT Deposit

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 9.
  Noncompetition Agreement

  	
   

  
	
  9.1

  	
  Noncompetition Agreement

  	
   

  
	
  9.2

  	
  Limitations
  on Noncompetition Agreement

  	
   

  
	
  9.3

  	
  Definition of
  Competitive Business

  	
   

  
	
  9.4

  	
  Nonsolicitaiton

  	
   

  
	
  9.5

  	
  Injunctive and
  Equitable Relief

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 10.
  Termination

  	
   

  
	
  10.1

  	
  Termination

  	
   

  
	
  10.2

  	
  Notice of Termination

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 11.
  Indemnification

  	
   

  
	
  11.1

  	
  Indemnification
  by the Selling Entities

  	
   

  
	
   

  	
  (a)

  	
  Misrepresentation
  or Breach of Warranty

  	
   

  
	
   

  	
  (b)

  	
  Breach of Covenant
  or Agreement

  	
   

  
	
   

  	
  (c)

  	
  Excluded Liabilities

  	
   

  
	
   

  	
  (d)

  	
  R&B Liabilities

  	
   

  
	
   

  	
  (e)

  	
  Product Liability

  	
   

  
	
   

  	
  (f)

  	
  Retained
  Environmental Liabilities of Transferred Subsidiaries

  	
   

  
	
   

  	
  (g)

  	
  Offsite Disposal

  	
   

  
	
   

  	
  (h)

  	
  Bulk Sales

  	
   

  
	
  11.2

  	
  Indemnification
  by Purchasing Entities

  	
   

  
	
   

  	
  (a)

  	
  Misrepresentation
  or Breach of Warranty

  	
   

  
	
   

  	
  (b)

  	
  Breach of Covenant
  or Agreement

  	
   

  
	
   

  	
  (c)

  	
  Assumed Liabilities

  	
   

  
	
   

  	
  (d)

  	
  Operations After Closing

  	
   

  
	
   

  	
  (e)

  	
  Product Liability

  	
   

  
	
   

  	
  (f)

  	
  Pension Liabilities

  	
   

  
	
   

  	
  (g)

  	
  Claims by Continuing
  Employees

  	
   

  
	
   

  	
  (h)

  	
  Performance Bonds

  	
   

  
	
  11.3

  	
  Claims for Reimbursement

  	
   

  
	
  11.4

  	
  Defense
  and Settlement of Third Party Claims

  	
   

  



 


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  11.5

  	
  Resolution of Disputes

  	
   

  
	
  11.6

  	
  Setoff for Resolved
  Claims

  	
   

  
	
  11.7

  	
  Limitations on
  Indemnification

  	
   

  
	
   

  	
  (a)

  	
  Duration

  	
   

  
	
   

  	
  (b)

  	
  Amount

  	
   

  
	
   

  	
   

  	
  (i)

  	
  Basket

  	
   

  
	
   

  	
   

  	
  (ii)

  	
  Cap

  	
   

  
	
   

  	
  (c)

  	
  Other Limitations

  	
   

  
	
   

  	
  (d)

  	
  Duty to Mitigate Damages

  	
   

  
	
   

  	
  (e)

  	
  No Double Recovery

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 12.
  Miscellaneous Provisions

  	
   

  
	
  12.1

  	
  Public
  Statements and Press Releases

  	
   

  
	
  12.2

  	
  Costs and Expenses

  	
   

  
	
  12.3

  	
  Amendment and
  Modification

  	
   

  
	
  12.4

  	
  No Assignment

  	
   

  
	
  12.5

  	
  Notices

  	
   

  
	
   

  	
  (a)

  	
  The Selling Entities

  	
   

  
	
   

  	
  (b)

  	
  A Purchasing Entity

  	
   

  
	
  12.6

  	
  Counterparts and
  Facsimile

  	
   

  
	
  12.7

  	
  Captions

  	
   

  
	
  12.8

  	
  Schedules and Exhibits

  	
   

  
	
  12.9

  	
  Waiver; Remedies

  	
   

  
	
  12.10

  	
  Governing Law

  	
   

  
	
  12.11

  	
  Severability

  	
   

  
	
  12.12

  	
  Survival
  of Representations, Warranties, Covenants and Agreements

  	
   

  
	
  12.13

  	
  No Third Party
  Beneficiaries

  	
   

  
	
  12.14

  	
  Construction

  	
   

  
	
  12.15

  	
  Entire Agreement

  	
   

  



 


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PURCHASE AND SALE AGREEMENT


 


This
Purchase and Sale Agreement (this “Agreement”)
is made and entered into on and as of the 17th day of March, 2005 (the “Agreement Date”), among UNOVA, Inc.
(“UNOVA”), a Delaware corporation; UNOVA
Industrial Automation Systems, Inc. (“UIASI”), a
Delaware corporation and a wholly-owned subsidiary of UNOVA; UNOVA U.K. Limited
(“UNOVA UK”), a company registered in
England under Registration Number 1218921 and a wholly-owned subsidiary of
UNOVA; Cincinnati Machine U.K. Limited (“CMUK”),
a company registered in England under Registration Number 3256777 and a wholly-owned
subsidiary of UNOVA; Honsberg Lamb Sonderwerkzeugmaschinen GmbH (“Honsberg”), a German limited
liability company and a subsidiary of UIASI and UNOVA UK; UNOVA Canada, Inc.
(“UNOVA Canada”), a Canadian
corporation and an indirect, wholly-owned subsidiary of UNOVA; and UNOVA IP
Corp. (“UNOVA IP”), a Delaware
corporation and a wholly-owned subsidiary of UIASI; (UNOVA, UIASI, UNOVA UK,
CMUK, Honsberg, UNOVA Canada and UNOVA IP are referred to collectively as the “Selling Entities”); and R&B
Plastics Holdings, Inc. (“Mainco”), a
Delaware corporation and a wholly owned subsidiary of Maxcor, Inc. or its
principal; MAG Industrial Automation Systems, LLC (“Purchaser”),
a Delaware limited liability company; and certain other wholly owned
subsidiaries of Purchaser that may be formed for purposes of the transactions
hereunder and which shall execute a document after formation agreeing to become
a party to this Agreement(collectively, the “Purchaser
Subsidiaries”).  Mainco,
Purchaser and the Purchaser Subsidiaries are sometimes referred to collectively
as the “Purchasing Entities”.  To the extent that any Purchasing Entity is
purchasing Purchased Assets under Section 1 of this Agreement, such
Purchasing Entity is also referred to herein as an “Asset
Purchasing Entity”.  Each
of the Selling Entities and each of the Purchasing Entities are sometimes
referred to collectively as the “Parties”
and individually as a “Party.”


 


W I T N E S S E T H:


 


WHEREAS,
“Cincinnati Lamb Group” is comprised
of the following:  the Cincinnati Lamb
operations of UIASI (the “Cincinnati Lamb U.S
division”); the Lamb Technicon U.K. operations of UNOVA UK
(the “Lamb U.K. division”); the
Cincinnati Lamb Windsor operations of UNOVA Canada (the “Cincinnati
Lamb Canada division”); the operations of CMUK; Honsberg;
Cincinnati Machine Korea Corp. (“CM Korea”),
a Korean corporation and a wholly-owned subsidiary of UNOVA; certain assets of
UNOVA IP used primarily or exclusively in connection with the Cincinnati
Lamb Group’s operations; UNOVA Industries, Inc., a Nevada corporation (“UII”); and R&B Machine Tool
Company (“R&B”), a Michigan
corporation and a wholly-owned subsidiary of UIASI;


 


WHEREAS,
CM Korea, UII and R&B are referred to collectively as the “Transferred Subsidiaries”;


 


WHEREAS,
the Cincinnati Lamb Group is engaged in the design, manufacture, sale and
service of value-added manufacturing products and services spanning the
production


 





















 


cycle from process engineering and design to systems
integration, including comprehensive life cycle support for the global
aerospace, equipment and general job shop markets (such activity as carried on
by the Cincinnati Lamb Group on the Agreement Date is referred to as the “Business”);


 


WHEREAS,
the Purchasing Entities desire to purchase from the Selling Entities, and the
Selling Entities desire to sell to the Purchasing Entities, substantially all
of the assets, subject to the assumption of specified liabilities of the
Cincinnati Lamb Group (the “Asset Sale”),
and the capital stock (collectively, the “Shares”) of
the Transferred Subsidiaries (the “Stock Sale”),
upon the terms and conditions set forth in this Agreement;


 


WHEREAS,
the Asset Sale and the Stock Sale are sometimes referred to collectively herein
as the “Transactions”;


 


NOW,
THEREFORE, in consideration of the premises and the mutual benefits to be
derived from this Agreement and the Transactions provided for in this
Agreement, the Parties agree as follows:


 


ARTICLE 1.

The Transactions


 


1.1                               Transfer
of Assets


 


Except
as otherwise provided in Section 1.2, effective as of the “Transfer Date” (as defined in Article 2),
each of the Selling Entities shall sell, transfer, assign, grant, convey and
deliver to the relevant Asset Purchasing Entity, free and clear of all “Liens” other than “Permitted Liens” (as such terms are
defined in Section 3.5), all of its right, title and interest in and to
its properties, rights and assets of every kind, nature and description,
whether real or personal, tangible or intangible, and wherever situated, to the
extent the same are used or held for use primarily or exclusively in the
operation of the Business (such properties, rights and assets are referred to
as the “Purchased Assets”), including
the goodwill of the Business and the names “Cincinnati Lamb”, “Cincinnati
Machine”, and “Honsberg”.  Except as
otherwise provided in Section 1.2, the Purchased Assets shall include
without limitation all of the following to the extent owned by any of the
Cincinnati Lamb Group other than the Transferred Subsidiaries and used primarily
or exclusively in the Business:


 


(a)                                  Trade and other accounts receivable,
including unbilled receivables, together with any unpaid interest or fees
accrued thereon or other amounts due with respect thereto, and any security or
collateral therefor, including recoverable advances and deposits;


 


(b)                                 Land, buildings, leaseholds, leasehold
improvements and other interests in realty, including without limitation the “Owned Real Property” (as defined in Section 3.6(a)),
and all improvements, fixtures and fittings thereon, and easements, servitudes,
rights-of-way and other appurtenances thereto (such as appurtenant rights in
and to public streets);


 


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(c)                                  Machinery and equipment, including test
equipment and fully depreciated equipment;


 


(d)                                 Tools, dies, molds and other tooling,
including any rights in respect of tools, dies, molds and other tooling and in
the possession of others;


 


(e)                                  Supplies and other consumables on hand;


 


(f)                                    Inventory, including raw materials,
work-in-process, finished goods, spare parts, replacement and component parts,
and samples;


 


(g)                                 Rights, if any, in any customer furnished
materials;


 


(h)                                 Motor vehicles;


 


(i)                                     Transportation and packing and delivery
equipment, materials and supplies;


 


(j)                                     Office equipment and supplies;


 


(k)                                  Office furniture and furnishings;


 


(l)                                     To the extent possible under the terms and
conditions thereof, indemnity, fidelity and contract bonds issued by third
parties in favor of any of the Cincinnati Lamb Group other than the Transferred
Subsidiaries;


 


(m)                               Causes of action, suits, judgments, claims
and demands of any nature;


 


(n)                                 Transferable franchises, licenses, approvals,
permits and other authorizations issued or granted by any “Governmental
Body” (as defined in Section 3.1(e));


 


(o)                                 Computer equipment, including all hardware
and software, and communications equipment;


 


(p)                                 Research, engineering and technical designs,
specifications, drawings, databases, know-how, research and development files,
laboratory books and information;


 


(q)                                 Customer and vendor lists and information;


 


(r)                                    Patents, registered designs, utility models, patent
applications, trademarks, trademark applications, trade names, internet
domains, service marks, logos, copyrights, chip registrations, patents,
licenses, processes, inventions, formulae, trade secrets and royalties,
including all registrations, applications and related international priority
rights and all rights to sue for past infringement;


 


(s)                                  Manufacturer and seller warranties on any
goods, fixtures, or services provided to any of the Cincinnati Lamb Group other
than the Transferred Subsidiaries;


 


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(t)                                    Prepaid items and expenses, rights of offset
and credits of all kinds, including any such items and expenses with respect to
leases and rentals;


 


(u)                                 Books, records, files and papers, whether in
hard copy or computer format, including but not limited to invoices,
advertising materials, catalogs, price lists, mailing lists, photographs,
production data, sale and promotional materials and records, purchasing
materials and records and documentation developed or used for accounting,
marketing, engineering, manufacturing or any other purpose;


 


(v)                                 Bids and sales and service proposals,
including any rights to revoke or withdraw the same;


 


(w)                               Purchase orders and purchase commitments;


 


(x)                                   Utility and similar deposits;


 


(y)                                 Customer orders and customer contracts;


 


(z)                                   Medical, safety and health supplies;


 


(aa)                            Leases for equipment and all other leases,
contracts and other agreements made on behalf of any of the Cincinnati Lamb
Group other than the Transferred Subsidiaries or which inure primarily to the
Cincinnati Lamb Group’s benefit; and


 


(bb)                          Rights and entitlements.


 


The
Parties acknowledge and agree that, as soon as practicable after the date of
this Agreement, and in any event not less than ten business days prior to the
Transfer Date, Purchaser shall provide UNOVA with (i) a proposed list of
the Purchasing Entities that will be purchasing Purchased Assets and assuming
Assumed Liabilities at Closing, and (ii) the respective Purchased Assets
to be purchased and Assumed Liabilities to be assumed by such Purchasing
Entities (the “Purchasing Entities Schedule”).  The Purchasing Entities Schedule shall
be subject to the written approval of UNOVA prior to Closing, which approval
shall not be unreasonably withheld.


 


1.2                               Excluded
Assets


 


Notwithstanding
anything in this Agreement to the contrary, the Purchased Assets shall not
include any right, title or interest in or to any of the following properties,
rights or assets of the Selling Entities (collectively, the “Excluded Assets”):


 


(a)                                  Cash, cash equivalents and short-term
securities, if any;


 


(b)                                 Any and all claims for refunds, carrybacks or
carryforwards of any of the Selling Entities (but not the Transferred
Subsidiaries) in connection with “Taxes” (as
defined in Section 3.18) for tax periods ending on or prior to the
Transfer Date and all returns and other documents filed by any of the Selling
Entities with any taxing authority;


 


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(c)                                  Any intercompany receivable balance due from
UNOVA or any of its subsidiaries (other than intercompany trade receivables);


 


(d)                                 All insurance policies and self-insurance
programs and any coverage or other rights under such policies and
self-insurance programs;


 


(e)                                  Any property or asset designated as “assets
held for sale” on the books and records of the Selling Entities or the
Cincinnati Lamb Group (collectively, the “Assets Held for Sale”)
and any assets related to the former Lamb Body & Assembly and R&B
Plastics operations of UIASI (the “Discontinued Operations”);


 


(f)                                    Any property, right or asset to the extent
primarily or exclusively relating to any other Excluded Asset or any of the “Excluded Liabilities” (as defined in
Section 1.7);


 


(g)                                 All assets of all “Employee
Benefit Plans” (as defined in Section 3.13(f)), including
assets held in trust or insurance contracts for the benefit of Employee Benefit
Plan participants or beneficiaries, except to the extent provided in Section 1.6(k),
Section 5.11 and Section 8.4(b)(v) and except for insurance
policies and assets relating to any pension plans in Germany;


 


(h)                                 All books, records, files and data pertaining
to any of the Excluded Assets or any of the Excluded Liabilities;


 


(i)                                     Subject to Section 8.5, all rights in,
to and under the names “UNOVA” or “UNOVA Industrial Automation Systems, Inc.”
and the logos of any of the Selling Entities other than those that are
primarily or exclusively related to the Business;


 


(j)                                     UIASI’s interest in The Factory Power
Company, an Ohio corporation and UNOVA Financing Limited (Reg. No. 4134168),
a dormant U.K. corporation;


 


(k)                                  Any rights of any of the Selling Entities
under this Agreement;


 


(l)                                     The franchise of each of the Selling Entities
to be a corporation and its articles or certificate of incorporation, bylaws
and other records pertaining to its corporate existence, and all books and
records of a nature required by “Law” (as
defined in Section 3.1(e)) to be maintained by the Selling Entities,
including all financial and tax records relating to the Business that form part
of the Selling Entities’ general ledger;


 


(m)                               All shares of capital stock or other equity
interests in any other Person (defined below) owned by any of the Selling
Entities; provided, however, that the stock of the
Transferred Subsidiaries will be transferred under Section 1.3; and


 


(n)                                 All right to any proceeds in the Alenia
judgment, which is disclosed on Schedule 1.2(n).


 


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For
purposes of this Agreement, “Person”
shall mean and include an individual, a partnership, a corporation, a limited
liability company, a trust, a joint venture, an unincorporated organization and
any “Governmental Body” (as defined in Section 3.1(e)).


 


1.3                               Transfers
of Shares


 


(a)                                  Transfer of CM
Korea Shares


 


Effective
as of the Transfer Date, UNOVA shall sell, transfer, assign and deliver to
Purchaser, free and clear of all Liens, all of the outstanding capital stock of
CM Korea (the “CM Korea Shares”).


 


(b)                                  Transfer of UII Shares


 


Effective
as of the Transfer Date, UNOVA shall sell, transfer, assign and deliver to
Purchaser, free and clear of all Liens, all of the outstanding capital stock of
UII (the “UII Shares”)


 


(c)                                  Transfer of R&B Shares


 


Effective
as of the Transfer Date, UIASI shall sell, transfer, assign and deliver to
Mainco, free and clear of all Liens, all of the outstanding capital stock of
R&B (the “R&B Shares”).


 


1.4                               Consideration


 


For
and in consideration of the sale to the Purchasing Entities of the Purchased
Assets and the Shares, (i) Purchaser (as agent for the Purchasing
Entities) shall on the dates indicated in Section 1.5, pay to UNOVA (as
agent for the Selling Entities) the “Purchase Price”
(as defined in Section 1.5(a)), in accordance with and to the extent
provided in Section 1.5, and (ii) the Asset Purchasing Entities
shall, effective as of the Transfer Date, assume the “Assumed
Liabilities” (as defined in Section 1.6 and as limited by Section 1.7)
((i) and (ii), collectively, the “Consideration”).


 


1.5                               Purchase
Price and Payment


 


(a)                                  Purchase Price


 


The
purchase price for the Purchased Assets and the Shares is $26,000,000, plus the
amount of the Assumed Liabilities (the “Purchase Price”),
subject to adjustment as provided in Section 1.8(e).


 


(b)                                  Payment of
Purchase Price


 


At
the “Closing” (as defined in Section 2.1),
(i) Mainco shall pay and remit to UNOVA (as agent for UIASI) $5,000 (the “R&B Cash Payment”), and (ii) Purchaser
shall


 


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(A) pay and remit to UNOVA (as agent for the
Selling Entities) the “Cash Payment”
(as provided in paragraph (i) below), and (B) execute and
deliver to UNOVA (as agent for the Selling Entities) the Secured Note (as
provided in paragraph (ii) below).


 


(i)                                    Cash Payment


 


The
“Cash Payment” is the amount of $16,000,000,
which (together with the R&B Cash Payment) will be paid by wire transfer of
immediately available funds to UNOVA’s bank account as indicated in Schedule 1.5(b)(i) Schedule 1.5(b)(i).


 


(ii)                                Secured Note


 


The
“Secured Note” is Purchaser’s secured
promissory note in the principal amount of $10,000,000 .  The Secured Note shall bear interest at the
rate of quarterly LIBOR + 3% on the outstanding balance of the Secured Note,
payable quarterly, with “LIBOR”
defined in the same manner as in the credit agreement between the Purchaser and
its senior lender entered into in connection with the transactions contemplated
by this Agreement.  Principal of the
Secured Note shall be payable in the following installments:  (i) $2,000,000 on the 18-month
anniversary of the Transfer Date, (ii) $2,000,000 on the 24-month
anniversary of the Transfer Date, (iii) $2,000,000 on the 30-month
anniversary of the Transfer Date, (iv) $2,000,000 on the 36-month
anniversary of the Transfer Date, and (v) the balance of $2,000,000 on the
42-month anniversary of the Transfer Date.  The Secured Note shall be secured by a second
priority security interest in the assets of the Cincinnati Lamb Group which are
included within the lien granted to the senior lender by Purchaser, until the
date the Secured Note is paid in full (the “Collateral”).  Except as provided otherwise in this Section 1.5(b)(ii) or
as consented to in writing by UNOVA, which consent will not be unreasonably
withheld, the Secured Note and related financing documents between the
Purchasing Entities and the Selling Entities will reflect terms and conditions
and subordination provisions substantially similar to those between the
Purchasing Entities and their senior lender as contemplated by the term sheet
attached to this Agreement as Exhibit A.


 


(c)                                  Allocation of
Consideration


 


(i)                                    Section 1060
Allocation


 


Within
six (6) months after the Transfer Date, Purchaser (on behalf of itself and
the other Purchasing Entities) shall prepare and deliver to UNOVA an allocation
of the Consideration among each of the Purchased Assets and the Shares (other
than the R&B Shares) sold to the Purchasing Entities (the “Allocation”) and an allocation of
that portion of the Purchase Price which is allocated among the Purchased Assets
in accordance with the Allocation and Section 1060 of the Code and the
regulations thereunder (the “Section 1060
Allocation”); provided, however, that the Parties agree that the amount to be
allocated to the transfer of CM Korea Shares is $122,000.  If UNOVA does not object to the Allocation
and the Section 1060 Allocation prepared by Purchaser within 30 days
after receipt thereof, such allocations shall be final for purposes of this
Agreement.  If UNOVA objects to the


 


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Allocation or the Section 1060 Allocation within 30 days
after receipt thereof, Purchaser and UNOVA shall meet promptly and in good
faith attempt to resolve any objections of UNOVA and to use their best efforts
to agree upon the allocation.  In the
event Purchaser and UNOVA are unable to resolve their differences over the
Allocation or the Section 1060 Allocation, such differences shall be
resolved by arbitration in accordance with Section 11.5.  The Parties shall cooperate fully with each
other and make available to each other such Tax data and other information as
may be reasonably required in order to timely complete the Allocation and the Section 1060
Allocation and any other required statements or schedules.  Except as required pursuant to applicable Law
or a determination (as defined in Section 1313 of the Internal Revenue
Code of 1986, as amended (the “Code”) or
any similar provision of Law), the Parties and their Affiliates (as defined
below) shall report the Transactions for all Tax purposes consistently with the
Allocation and the Section 1060 Allocation.  For purposes of this Agreement, “Affiliate” means a Person that,
directly or indirectly, through one or more intermediaries, controls, is
controlled by or is under common control with the first mentioned Person.  To the extent that the parties require
allocations for Closing, including for the United Kingdom and for Korean Securities
Transaction Tax (“STT”), then the parties shall
endeavor to cooperate fully with each other to agree upon such allocations on
or prior to the Transfer Date.


 


(ii)                                Section 338
Allocation


 


Within six (6) months after the Transfer Date, UNOVA shall (on
behalf of itself and UIASI) prepare and deliver to Mainco an allocation of the
deemed sale price of the assets of R&B resulting from any “Section 338(h)(10) Election”
(as defined in Section 8.7(h)) (the “Section 338
Allocation”) in accordance with the Section 338 of the Code
and any similar provision of Law, as applicable.  If Mainco does not object to the Section 338
Allocation prepared by UNOVA within 30 days after receipt thereof, such
allocation shall be final for purposes of this Agreement.  If Mainco objects to the Section 338
Allocation within 30 days after receipt thereof, UNOVA and Mainco shall
meet promptly and in good faith attempt to resolve any objections of Mainco and
to use their best efforts to agree upon the allocation.  In the event UNOVA and Mainco are unable to
resolve their differences over the Section 338 Allocation, such
differences shall be resolved by arbitration in accordance with Section 11.5.  The parties shall cooperate fully with each
other and make available to each other such Tax data and other information as
may be reasonably required in order to timely complete the Section 338
Allocation and file any Section 338(h)(10) Elections and any other
required statements or schedules.  Except
as required pursuant to applicable Law or a determination (as defined in Section 1313
of the Code or any similar provision of Law), the Selling Entities, Mainco and
their respective Affiliates shall report the sale of the R&B Shares for all
Tax purposes consistently with the Section 338 Allocation.


 


(iii)                            Section 56.4 Election


 


UNOVA
Canada and Purchaser, on behalf of the relevant Purchasing Entity or Purchasing
Entities, shall execute and file, on a timely basis and using the prescribed
forms, a joint election to have proposed paragraphs 56.4(3)(b) and (c) (or
such similar provision as


 


8





















 


finally enacted), as applicable, of the Income Tax Act (Canada) apply
to the amount of the Purchase Price attributable to the non-competition
covenant provided with respect to the Business attributable to Canadian
operations and shall prepare their respective Tax Returns (as defined in Section 3.18)
consistent with such joint election.  For
the purposes of such joint election, the amount of the Purchase Price attributable
to such non-competition covenant will be consistent with the Purchase Price
allocation determined in accordance with this Agreement. The Parties agree, on
behalf of themselves and their Affiliates, to file all Canadian Tax Returns
consistent with the portion of the Purchase Price allocated to the
non-competition covenant.  On or prior to
the date the joint election is required to be filed, the Parties will confirm
that the amount that will be allocated to the non-competition covenant will be
the portion of the Purchase Price paid that can reasonably be regarded as
consideration for the non-competition covenant.


 


(iv)                               Section 167 Election


 


UNOVA
Canada or its successor and Purchaser, on behalf of the relevant Purchasing
Enity or Purchasing Entities, shall execute and file, on a timely basis and
using the prescribed form, a joint election under Section 167 of the
Excise Tax Act (Canada) (the “ETA”)) so
that no tax will be payable under the ETA in respect of the transfer of the
Purchased Assets.


 


(v)                                   Section 22 Election


 


UNOVA
Canada and Purchaser, on behalf of the relevant Purchasing Entity or Purchasing
Entities, shall execute and file, on a timely basis and using the prescribed
form, a joint election under section 22 of the Income Tax Act (Canada) as
to the sale of the accounts receivable of UNOVA Canada to be purchased under this
Agreement, and prepare their respective Tax Returns (as defined in Section 3.18)
in a manner consistent with such joint election.  For purposes of such joint election, the elected
amount in respect of the accounts receivable will be consistent with the
Purchase Price allocation, as determined by the Parties prior to the filing of
the joint election.


 


1.6                               Assumed
Liabilities


 


Upon
the terms and subject to the conditions of this Agreement and in reliance upon
the representations, warranties and agreements herein set forth, each of the Asset
Purchasing Entities shall, effective at the time of Closing, assume, perform
and discharge all of the following debts, liabilities or obligations (other
than the “Excluded Liabilities” (as
defined in Section 1.7)) that relate to the Business or the Purchased
Assets, whether occurring prior to, on or after the Transfer Date
(collectively, the “Assumed Liabilities”):


 


(a)                                  All obligations of the Selling Entities in
respect of the Business to be performed from and after the Transfer Date and
all other debts and liabilities of the Selling Entities in respect of the
Business under contracts or other legally binding commitments that are
disclosed in the Schedules to this Agreement or which are of the type required
to be disclosed in such Schedules but are not so disclosed because they fall
below the minimum


 


9





















 


threshold amount or materiality of the agreements or
commitments required to be so disclosed and which are assigned to Purchaser;


 


(b)                                 Trade accounts payable in respect of the
Business as shown on the Closing Balance Sheet;


 


(c)                                  Accrued payroll, bonuses and related items
for the “Continuing Employees” (as
defined in Section 8.4(a)) as shown on the Closing Balance Sheet,
excluding any accrued amounts that are required by Law to be paid by any of the
Selling Entities on or prior to the Transfer Date;


 


(d)                                 Accrued sales commissions to Continuing
Employees or to third parties in respect of the Business as shown on the
Closing Balance Sheet;


 


(e)                                  All debts, liabilities and obligations with
respect to products sold or serviced (whether or not under warranty) by the
Selling Entities in respect of the Business, including liabilities and
obligations for and with respect to any refunds, adjustments, allowances,
repairs, exchanges, returns and warranty, but excluding Product Liability (as
defined herein) which is covered by sub clause (g) below;


 


(f)                                    Any debt, liability or obligation for workers
compensation, automobile or general liability in respect of the Business, to
the extent such claims arise from occurrences following the Transfer Date;


 


(g)                                 Any debt, liability or obligation for product
liability claims, including bodily injury, death or property damage (“Product Liability”) arising from the
use or operation of products sold or serviced in the Business, to the extent
such claims arise out of injuries which occur following the Transfer Date;


 


(h)                                 All debts, liabilities and obligations
arising under “Environmental Laws” (as
defined in Section 3.6 (d)) and in respect of the Business and the
Purchased Assets, except to the extent the same constitutes a “Retained Environmental Liability”
(as defined in Section 1.7(e));


 


(i)                                     Any debt, liability or obligation arising out
of, or in respect of or as a result of the employment or termination of
employment of any Continuing Employee on or after the Transfer Date (other than
the “Litigation Required Employees” (as
defined in Section 8.3));


 


(j)                                     Those certain debts, liabilities or
obligations set forth on Exhibit B;


 


(k)                                  Any debt, liability or obligation relating to
the “CMUK Plan” (as defined in Section 8.4(b)(v)),
the “CMUK Supplementary Plan” (as defined
in Section 8.4(b)(v)) and “CMUK DC Plan”
(as defined in Section 5.11); and


 


(l)                                     All debts, liabilities and obligations for
post-retirement matters included in the Closing Balance Sheet that constitute
FAS 106 liabilities (“FAS 106 Liabilities”).


 


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1.7                               Excluded
Liabilities


 


Notwithstanding
anything in this Agreement to the contrary, none of the Asset Purchasing
Entities shall assume or be liable or responsible for, and the Selling Entities
shall retain, pay, perform and discharge when due all the following debts,
liabilities or obligations of the Selling Entities, whether or not arising out
of or relating to the Purchased Assets or the operation of the Business prior
to the Transfer Date (collectively, the “Excluded Liabilities”):


 


(a)                                  Any debt, liability or obligation of the
Selling Entities in respect of the Business for Taxes that relate to periods
ending on or prior to the Transfer Date, except as otherwise provided in Section 8.7(e);


 


(b)                                 Any intercompany payable balances in respect
of the Business due to UNOVA or any of its subsidiaries (other than
intercompany trade payables);


 


(c)                                  Any debt, liability or obligation covered by
any of the insurance policies or self-insurance programs of the Selling
Entities in respect of the Business, including liabilities for workers
compensation, automobile or general liability, to the extent such claims arise
from occurrences on or prior to the Transfer Date;


 


(d)                                 Any debt, liability or obligation for Product
Liability arising from the use or operation of products sold or serviced in the
Business, to the extent such claims arise out of losses or injuries which
occurred on or prior to the Transfer Date;


 


(e)                                  Any “Retained Environmental
Liability” which for purposes of this Agreement shall mean (i) any
“Loss” (as defined in Section 11.1)
arising from a claim by a third party, including a Governmental Body, that
relates to any matter or condition that constitutes, or is demonstrated to have
constituted, a violation of any applicable Environmental Law as in effect on
the Transfer Date and listed on Schedule 3.6(d),
and (ii) any Loss arising from a condition or event at, on or under the
Real Property which occurred on or prior to the Transfer Date, including the
presence or release of any “Hazardous Substance”
(as defined in Section 3.6(d)), to the extent that such condition is
delineated during the “Phase I” or “Phase II”
(as such terms are defined in Section 5.8), whether or not known on or
prior to the Transfer Date;


 


(f)                                    Any debt, liability or obligation arising
under any of the Employee Benefit Plans, except to the extent provided in
Sections 1.6(k), 1.6(l), 5.11 and 8.4 and except for liabilities
transferred to the “CMUK DC Plan” (as defined in Section 5.11);


 


(g)                                 Any debt, liability or obligation related to Discontinued
Operations;


 


(h)                                 Any debt, liability or obligation to the
extent related to any of the other Excluded Liabilities or any of the Excluded
Assets;


 


11





















 


(i)                                     Those pending or threatened litigation
matters identified on Schedule 3.14 (the “Retained
Litigation”) and any matter identified on Schedule 3.16;


 


(j)                                     Any liabilities of the Selling Entities of
any kind or nature arising under, or relating to the execution, delivery or
consummation of, this Agreement and the transactions contemplated hereby;


 


(k)                                  Any liabilities of the Selling Entities for
indebtedness for borrowed money;


 


(l)                                     Any debt, liability or obligation under the
UNOVA Supplemental Executive Retirement Plan;


 


(m)                               Any debt, liability or obligation under the “UPF” (as defined in Section 5.11,
other than any debt, liability or obligation which becomes a debt, liability or
obligation of the CMUK DC Plan as a result of the transactions contemplated by Section 5.11);
and


 


(n)                                 Any debt, liability or obligation for
employees who are not Continuing Employees except as provided in Sections
1.6(k), 1.6(l), 5.11 and 8.4(e).


 


1.8                               Closing
Balance Sheet


 


The
“Closing Balance Sheet” shall be a
balance sheet of the Purchased Assets, Assumed Liabilities and the assets and
liabilities of the Transferred Subsidiaries as of the Transfer Date, prepared
without any departures from generally accepted accounting principles in the
United States of America (“GAAP”),
consistently applied, and determined as provided in this Section 1.8.


 


(a)                                  Cincinnati Lamb
Group December Balance Sheets


 


Prior
to Closing, UNOVA and Purchaser shall agree on the procedures to be taken by
UNOVA’s independent certified accounting firm (the “Deloitte
Procedures”), and UNOVA shall cause such accounting firm to
perform the Deloitte Procedures with respect to the balance sheet accounts of
the Cincinnati Lamb Group contained within the UNOVA audited consolidated
balance sheet as of December 31, 2004 in accordance with GAAP, consistently
applied.  A balance sheet of such
accounts of the Cincinnati Lamb Group after the Deloitte Procedures are so
performed is referred to as “Cincinnati Lamb Group December Balance
Sheet.”  Prior to the
Transfer Date, UNOVA shall deliver to Purchaser (i) the Cincinnati Lamb
Group December Balance Sheet, and (ii) a balance sheet of the
Purchased Assets, Assumed Liabilities and the assets and liabilities of the
Transferred Subsidiaries as of December 31, 2004 (the “Adjusted December Balance Sheet”)
based on the Cincinnati Lamb Group December Balance Sheet and the
adjustments (the “Agreement Adjustments”) that
are required to exclude the Excluded Assets and Excluded Liabilities and
reflect any other adjustments provided for in this Agreement.


 


12





















 


(b)                                  Preliminary
Closing Balance Sheet


 


Within
45 days following the Transfer Date, UNOVA shall prepare and deliver to Purchaser
a balance sheet of the Purchased Assets, Assumed Liabilities and the assets and
liabilities of the Transferred Subsidiaries as of the Transfer Date (the “Preliminary Closing Balance Sheet”)
based on a roll-forward of the Adjusted December Balance Sheet to the
Transfer Date in accordance with GAAP.


 


(c)                                  Review of
Preliminary Closing Balance Sheet


 


Purchaser
shall have 45 days following its receipt of the Preliminary Closing
Balance Sheet (the “Review Period”) to review the
same for compliance with GAAP and the Agreement Adjustments.  On or before the expiration of the Review
Period, Purchaser shall deliver to UNOVA a written statement accepting or
objecting to the Preliminary Closing Balance Sheet.  In the event that Purchaser shall object to
the Preliminary Closing Balance Sheet, such statement (the “Statement of Objections”) shall
include a detailed itemization of Purchaser’s objections and the reasons
therefor.  If Purchaser does not deliver
to UNOVA the Statement of Objections within the Review Period, Purchaser shall
be deemed to have accepted the Preliminary Closing Balance Sheet.  If Purchaser delivers to UNOVA the Statement
of Objections within the Review Period, Purchaser shall be deemed to have
waived any objections to the Preliminary Closing Balance Sheet that are not
included in the Statement of Objections.


 


(d)                                  Finalization of
Closing Balance Sheet


 


In
the event that Purchaser shall accept or shall be deemed to have accepted the
Preliminary Closing Balance Sheet as prepared and delivered by UNOVA, the
Preliminary Closing Balance Sheet shall constitute the Closing Balance Sheet
for purposes of this Agreement.  In the
event, however, that Purchaser shall object to the Preliminary Closing Balance
Sheet, UNOVA and Purchaser shall promptly meet and in good faith attempt to
resolve the issues that are in dispute. 
In the event that the issues in dispute shall not have been resolved
within 30 days following UNOVA’s receipt of Purchaser’s Statement of
Objections, such disputed issues shall be resolved by an independent certified
accounting firm jointly selected by UNOVA and Purchaser (the “Independent Firm”), provided the
Parties shall attempt to reach a final resolution of any matters which remain
in dispute at the earliest practicable date. 
The costs and expenses of the Independent Firm in reviewing the issues
in dispute shall be borne fifty percent (50%) by Purchaser and fifty percent
(50%) by UNOVA.  The Preliminary Closing
Balance Sheet, as adjusted to reflect the adjustments agreed upon by such
Parties or determined by the Independent Firm, shall constitute the Closing
Balance Sheet for purposes of this Agreement.


 


(e)                                  Net Working Assets


 


If
the net working assets as shown on the Closing Balance Sheet are greater than $130,500,000,
then the Secured Note will be increased by an amount equal to 30% of such difference,
with such increased amount to be added to the principal of the Secured Note and


 


13





















 


payable forty-two months after the Transfer
Date.  As used herein, net working assets
shall mean, as of the Transfer Date, the excess of the inventory and
receivables over the accounts payable on the Closing Balance Sheet.


 


1.9                               Right
to Contest


 


The
assumption and agreement by the Asset Purchasing Entities to pay, perform and
discharge the Assumed Liabilities shall not prohibit the Asset Purchasing Entities
from contesting with a third party, in good faith and at the expense of the
Asset Purchasing Entities, the amount, validity or enforceability of any
thereof; provided, however, that the
Asset Purchasing Entities shall indemnify the Selling Entities for any Loss
arising from such contest.


 


1.10                        Nonassignable
Contracts and Rights


 


To
the extent that the assignment by any of the Selling Entities of any contract,
property, right or asset to be assigned to any Asset Purchasing Entity pursuant
to this Agreement shall require the consent or approval of any other party, and
such consent or approval shall not have been obtained on or prior to the
Transfer Date, this Agreement shall not constitute a contract to assign the
same if an attempted assignment would constitute a breach thereof or would in
any way adversely affect the rights of any of the Selling Entities (or any
Asset Purchasing Entity, as assignee) thereunder.  If any such consent or approval is required
but not obtained on or prior to the Transfer Date, the Parties covenant and
agree that in such case, the applicable Selling Entities shall continue to deal
with the other contracting party or parties, with the benefits of such
contract, property, right or asset after the Transfer Date accruing to the benefit
of the applicable Asset Purchasing Entity and the liabilities and obligations
thereunder being performed by the applicable Asset Purchasing Entity on such
Selling Entities’ behalf; such Selling Entities shall hold all moneys received
thereunder for the benefit of the applicable Asset Purchasing Entity and shall
pay the same to Purchaser when received; and the Parties shall use all
reasonable efforts without payment of any penalty or fee to obtain and secure
any and all consents and approvals that may be necessary to effect the valid
sale, transfer or assignment of the same to the applicable Asset Purchasing
Entity without change in any of the material terms or conditions thereof,
including without limitation the formal assignment or novation of any of the
same, if so required.  The Parties
further covenant and agree to make or complete such transfers as soon as
reasonably possible and to cooperate with each other in any other reasonable
arrangement designed to provide for the applicable Asset Purchasing Entity the
benefits of and to such properties, rights or assets and to provide for the
performance by the applicable Asset Purchasing Entity of the liabilities and
obligations related thereto.


 


1.11                        Power
of Attorney


 


Effective
as of the Transfer Date, the applicable Selling Entities hereby irrevocably and
unconditionally constitute and appoint Purchaser (and its successors and
permitted assigns) the true and lawful attorneys of such Selling Entities in
respect of the Business with


 


14





















 


full power of substitution on behalf of and for the
benefit of Purchaser and at the expense of Purchaser, for and in the name or
otherwise on behalf of such Selling Entities, (a) to collect for the
account of Purchaser all items hereby transferred to Purchaser (including the
power to endorse checks and other instruments in connection therewith), (b) to
institute and prosecute, in the name of such Selling Entities, Purchaser or
otherwise, and at the expense of Purchaser, all proceedings which Purchaser may
deem necessary or proper in order to collect, assert or enforce any claim,
right or title of any kind in or to the Purchased Assets hereby sold,
transferred or assigned to Purchaser, and (c) subject to the terms of Article 11,
to defend and compromise any and all actions, suits or proceedings in respect
of any of the Purchased Assets hereby sold, transferred or assigned to
Purchaser.  Each of the Selling Entities
covenants and agrees that the foregoing powers are coupled with an interest and
are and shall be irrevocable by such Selling Entity.  Each of the Selling Entities further
covenants and agrees that Purchaser shall retain for its own account any
amounts collected pursuant to the foregoing powers, including any sums payable
as interest in respect thereof, and the Selling Entities covenant and agree to
pay or deliver to Purchaser, when received by such Selling Entities, any
amounts or property which may be received by such Selling Entities in respect
of any of the Purchased Assets which are to be sold, transferred or assigned to
Purchaser pursuant to this Agreement.


 


1.12                        Bulk
Sales


 


Purchaser,
on behalf of itself and its Affiliates, hereby waives compliance by the Selling
Entities with the bulk sales provisions of the Uniform Commercial Code, the
Bulk Sales Act (Ontario) or similar statutory scheme; provided that such waiver does not as
between the Purchasing Entities and the Selling Entities relieve the Selling
Entities of any debt, liability or obligation to any other person not assumed
by a Purchasing Entity under this Agreement. 
Purchaser further waives compliance by UNOVA Canada of its obligations
under section 6 of the Retail Sales Tax Act (Ontario), and any equivalent
or corresponding provisions contained in any similar legislation of any
Canadian province in which UNOVA Canada carries on business or has a fixed
place of business, in connection with the completion of the transactions
provided in this Agreement.


 


(Article 2 follows)


 


15





















 


ARTICLE 2.

Closing and Transfer Date


 


2.1                               Closing


 


Consummation
of the purchase and sale of the Purchased Assets and the Shares and the other
transactions provided for in this Agreement (the “Closing”)
shall take place at the offices of Stroock & Stroock & Lavan
LLP, counsel for Mainco and Purchaser, located at 180 Maiden Lane, New York,
New York, commencing at 8:00 a.m. on April 4, 2005 , or at such other
date or time or other place as the Parties may mutually agree upon in writing; provided, however, that the purchase and
sale of the Purchased Assets and the Shares and all other transactions provided
in this Agreement shall be deemed to have occurred simultaneously and shall be
effective at 11:59 p.m. (Eastern time) on April 3, 2005, or at such other
date or time as the Parties may mutually agree upon in writing (such date, the “Transfer Date”).


 


2.2                               Notice
and Right to Cure


 


At
all times prior to the Transfer Date, the Parties shall promptly notify each
other of the existence of any condition or the occurrence of any event which
will or is likely to result in the failure to satisfy any one or more of the
conditions set forth in Articles 6 and 7. 
If any of such conditions shall not have been satisfied or waived on or
by the date on which the Closing is otherwise scheduled, then, subject to Section 10.1(b) and
provided that such Party is not in breach of this Agreement, the Party which is
unable to meet such condition shall have a reasonable time and a reasonable
opportunity (not to exceed seven business days) to extend the Transfer Date in
order to satisfy, at its expense, such condition or conditions.


 


2.3                               Reconciliation
of Cash


 


The
Parties shall perform a cash reconciliation with respect to the period between
the Transfer Date and the Closing (the “Interim Period”)
in accordance with this Section 2.3. 
In the event that the total amount of cash receipts obtained by all Selling
Entities and Transferred Subsidiaries in respect of the Business during the
Interim Period (the “Cash Receipts”)
is greater or less than the total cash disbursements made by all Selling Entities
and Transferred Subsidiaries in the aggregate in respect of the Business during
the Interim Period (the “Cash Disbursements”)
(the amount of such difference is referred to as the “Cash
Difference”) (a) UNOVA shall pay the Cash Difference to
Purchaser (if the Cash Receipts are greater than the Cash Disbursements), or (b) Purchaser
shall pay the Cash Difference to UNOVA (if the Cash Receipts are less than the
Cash Disbursements).  On the date of
delivery of the Preliminary Closing Balance Sheet, UNOVA shall deliver to
Purchaser a statement setting forth Seller’s calculation of the Cash Difference
(the “Preliminary Cash Difference”).  Purchaser shall accept, object to or be
deemed to have accepted the Preliminary Cash Difference at the same time and in
the same manner as it responds to the Preliminary Closing Balance Sheet.  Payment of the Cash Difference shall be made
in cash or by wire transfer within 30 days of final determination of the Cash
Difference.


 


16





















 


(Article 3 follows)


 


 


 


17





















 


ARTICLE 3.

Representations and Warranties of the Selling Entities


 


The
Selling Entities jointly and severally represent and warrant to Mainco and
Purchaser as follows:


 


3.1                               Corporate
Matters


 


(a)                                  Due
Organization, Good Standing and Qualification


 


Each
of the Selling Entities and the Transferred Subsidiaries is a corporation or
limited liability company duly organized, validly existing and in good standing
under the laws of its jurisdiction of incorporation or formation, as applicable.  Each of the Selling Entities and the
Transferred Subsidiaries is qualified to conduct the Business as a foreign
corporation or foreign limited liability company in all jurisdictions where the
conduct of the Business or the ownership of its assets in respect of the
Cincinnati Lamb Group requires qualification, except where the failure to be so
qualified would not have a material adverse effect (as defined below) with
respect to the Business.


 


For
purposes of this Agreement, the terms “material adverse effect”
or “material adverse change” with
respect to the Cincinnati Lamb Group means any circumstance, event, change,
violation, failure, inaccuracy, effect or other matter that, individually
or when taken together with all other circumstances, events, changes,
violations, failures, inaccuracies, effects or other matters, is
materially adverse to (a) the operations of the Business taken as a whole,
or (b) the ability of the Selling Entities to timely consummate the
transactions contemplated by this Agreement; and such terms with respect to the
Purchasing Entities means any circumstance, event, change, violation, failure,
inaccuracy, effect or other matter that, individually or when taken
together with all other circumstances, events, changes, violations,
failures, inaccuracies, effects or other matters, is materially adverse to
(x) the business, operations or financial condition of the Purchasing Entities,
taken as a whole, or (y) the ability of the Purchasing Entities to timely
consummate the transactions contemplated by this Agreement; provided, however,
that in each case, the foregoing definitions exclude the effects of changes
that are generally applicable to (i) the industries and markets in which
the Business operates, (ii) the United States economy or securities
or capital markets or (iii) the world economy or securities or
capital markets.  The Parties further
understand and agree that changes in cash flow and net working assets are
common in the ordinary course of the Business, and as such do not constitute a
material adverse change or material adverse effect.


 


(b)                                  Corporate
Authority to Conduct Business


 


Each
of the Selling Entities and the Transferred Subsidiaries has the corporate
power and authority to own, lease and operate its properties and assets and to
carry on the portion of the Business attributable to it as it is now being
conducted.


 


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(c)                                  Corporate Power
and Authority to Enter Into Agreements


 


Each
of the Selling Entities has the corporate power and authority to execute and
deliver this Agreement and the other agreements provided for herein (the “Related Agreements”) to which it is
a party and perform its obligations hereunder and thereunder.


 


(d)                                  Due Execution
and Enforceability


 


The
execution, delivery and performance by and on behalf of each of the Selling
Entities of this Agreement and the Related Agreements to which it is a party have
been duly authorized by all necessary corporate action.  This Agreement constitutes a valid and
binding obligation of each of the Selling Entities, enforceable against each of
them in accordance with its terms, except to the extent the same may be limited
by bankruptcy, insolvency, reorganization, moratorium or similar laws affecting
creditors’ rights generally or by general equitable principles.  The Related Agreements to which each of the
Selling Entities is a party, when executed and delivered by the applicable
Selling Entities, will constitute valid and binding obligations of the
respective Selling Entities, enforceable against each of them in accordance
with their respective terms, except to the extent the same may be limited by
bankruptcy, insolvency, reorganization, moratorium or similar laws affecting
creditors’ rights generally or by general equitable principles.


 


(e)                                  No Conflict


 


With respect to each of the Selling Entities, the
execution and delivery of this Agreement and the Related Agreements to which
such Person is a party do not, and the consummation by it of any of the
transactions contemplated hereby or thereby will not:


 


(i) conflict with or violate its certificate
of incorporation, bylaws or other constituent documents;


 


(ii) violate any applicable Law (defined below) of any
federal, state, provincial, local or foreign court or tribunal, government,
regulatory body, agency or authority (a “Governmental Body”);


 


(iii) violate, conflict with, result in any breach of, or constitute a
default (or an event that, with notice or lapse of time or both, would
constitute a default) under any Contract to which it is a party or by which it
is bound, except as would not be reasonably likely to have a material adverse
effect on the Business; or


 


(iv) result
in the creation of any Lien on any of the Purchased Assets.


 


For purposes of this Agreement, “Law” means any federal, state, provincial, local
or foreign Law, code, regulation, rule, order, writ, ordinance, permit,
license, injunction, judgment, ruling, policy or decree having the force of
law, including, without limitation, the Fair Labor Standards Act, the
Employment Standards Act (Ontario), the HSR Act, the Securities Act of 1933, as
amended (the “Securities Act”), the
Securities Act (Ontario) and


 


19





















 


similar applicable Laws in other jurisdictions, all
Environmental Laws and all permitting and approval requirements and common law.


 


(f)                                    Subsidiaries
and Other Equity Investments


 


Except
as set forth on Schedule 3.1(f), none of the
Selling Entities has any subsidiaries (other than the Transferred Subsidiaries)
or other equity investments in any corporation, company, partnership, joint
venture or other entity relating primarily or exclusively to the Business.  The CM Korea Shares constitute all the issued
and outstanding shares of capital stock of CM Korea.  The R&B Shares constitute all the issued
and outstanding shares of capital stock of R&B.  The UII Shares constitute all the issued and
outstanding shares of capital stock of UII.


 


(g)                                 Articles and By-laws


 


The
Selling Entities have provided Purchaser and Mainco with true, correct and
complete copies of the articles of incorporation and by-laws (or their
substantial equivalents), minute and stock books as amended and in effect, of
each of the Transferred Subsidiaries.


 


(h)                                 Capitalization
and Shareholders


 


Set
forth on Schedule 3.1(h) is a list and
description of the authorized, issued and outstanding capital stock of each of
the Transferred Subsidiaries, all options or warrants to purchase shares of
capital stock of the Transferred Subsidiaries, and any securities convertible
into shares of capital stock of either of the Transferred Subsidiaries.  Also set forth on Schedule 3.1(h) is
a list of all holders of shares of capital stock of the Transferred
Subsidiaries, options or warrants to purchase shares of capital stock of the
Transferred Subsidiaries or securities convertible into shares of capital stock
of the Transferred Subsidiaries.  All
Shares are duly and validly issued, fully paid, non-assessable and owned of
record as set forth on Schedule 3.1(h). 
On the Transfer Date, there will be no options or warrants to purchase
shares of capital stock of the Transferred Subsidiaries or securities
convertible into shares of capital stock of the Transferred Subsidiaries.


 


(i)                                    Amalgamation of
UNOVA Canada


 


UNOVA
and UNOVA Canada have informed the Purchasing Entities that following the
execution of this Agreement, they and certain affiliates intend to take the following
actions:  (i) UNOVA will contribute
all of the outstanding capital stock of UNOVA Canada to Intermec Technologies
Corporation (“Intermec”), a wholly-owned
subsidiary of UNOVA, (ii) Intermec will contribute that stock to Intermec
Technologies Canada Ltd. (“Intermec Canada”),
and (iii)  UNOVA Canada and Intermec Canada will enter into a vertical
amalgamation under Canadian law, and the amalgamated corporation will be known
as Intermec Technologies Canada Ltd. (“New Intermec Canada”).  This series of actions is referred to as the “Amalgamation”.  Immediately following the Amalgamation, New
Intermec Canada will have all properties, rights and assets and all debts,
liabilities and


 


20





















 


obligations of UNOVA Canada, including its
obligations under this Agreement.  The
Purchasing Entities consent to the Amalgamation.


 


(j)                                    Residency


 


All
Purchased Assets located in Canada are owned beneficially and legally by UNOVA
Canada and not by any other Selling Entity, UNOVA Canada is not and New
Intermec Canada will not be a non-resident of Canada for the purposes of the
Income Tax Act (Canada).


 


(k)                                Certain Additional Matters


 


In
respect of each of UNOVA UK and CMUK:


 


(i)                                     No order has been made or petition presented
or resolution passed for its winding up;


 


(ii)                                  No administrative or other receiver has been
appointed by any person over the whole or any part of its business or assets;
and


 


(iii)                               No order has been made or petition presented
for the appointment of an administrator.


 


3.2                               Financial


 


(a)                                  December Financials


 


Set
forth on Schedule 3.2(a) is the
combined balance sheet of the Cincinnati Lamb Group as of December 31,
2004 (the “December Balance Sheet”),
as prepared by UNOVA, and the related combined statement of operations for the
year then ended (collectively, the “December Financials”).  Except as otherwise disclosed on Schedule 3.2(a),
the December Financials have been prepared in conformity with GAAP
consistently applied throughout the periods covered, except as may be indicated
in the notes thereto, and present fairly in all material respects the combined
financial position and the combined results of their operations for the year
then ended, excluding impairment charges and reclassifications required at the
corporate level because of discontinued operations status and excluding
allocated costs related to restricted stock and pensions allocated to the
Cincinnati Lamb Group in UNOVA’s consolidated adjustments.  The Cincinnati Lamb Group has no liabilities
or obligations (absolute, accrued or contingent) that are not reflected or
reserved against in the December Balance Sheet, as prescribed by GAAP and
the Financial Accounting Standards Board, except (i) liabilities or
obligations incurred since the date of the December Balance Sheet in the
ordinary course of business and consistent with past practice, and (ii) as
otherwise disclosed in this Agreement.


 


21





















 


(b)                                  Events
Subsequent to December Balance Sheet


 


Since
December 31, 2004, there has not been any of the following, except as
approved by Purchaser or as otherwise disclosed on Schedule 3.2(b):


 


 (i)                                  Any material damage or destruction (whether
or not covered by insurance) adversely affecting the properties, rights or
assets of the Business, taken as a whole, that would reasonably be expected to have
a material adverse effect on the Business;


 


(ii)                                  Any sale or other disposition of any capital
asset used in the Business with an original cost in excess of $150,000
(excluding any Assets Held for Sale);


 


(iii)                               Except as referred to in this Agreement, any
increase in the wage, salary, commission or other compensation (other than
increases granted in the ordinary course of business and consistent with past
practice) payable or to become payable by any of the Cincinnati Lamb Group to
any of the “Employees” (as defined in Section 3.13(a)),
or any change in any existing, or creation of any new, insurance or other plan
under which any of the Cincinnati Lamb Group provides benefits to such
Employees;


 


(iv)                              Any declaration, setting aside or payment of
any dividend or any distribution with respect to the shares of capital stock of
any Transferred Subsidiary, or any direct or indirect redemption, purchase or
other acquisition of any such shares;


 


(v)                                 Any release or waiver by any of the
Cincinnati Lamb Group of any material claim or right in respect of the
Business;


 


(vi)                              Any amendment, waiver or forgiveness of any
material term of any outstanding equity or debt security of a Transferred Subsidiary;


 


(vii)                           Any change in accounting methods, principles
or practices used by the Business, except insofar as may have been required by
a change in GAAP or Law; or


 


(viii)                        Made or changed an election concerning any
Taxes, changed an annual accounting period or adopted or changed any accounting
method, in either case to the extent such change would materially affect the
Taxes of the Purchasers.


 


Furthermore,
except as approved by Purchaser or disclosed in Schedule 3.2(b),
since December 31, 2004, no Selling Entity nor Transferred Subsidiary, nor
to the knowledge of the Selling Entities and the Transferred Subsidiaries, none
of the Selling Entities’ nor the Transferred Subsidiaries’ officers, directors
or agents in their representative capacities on behalf of any such entity, has:


 


(viii)                        Paid, discharged or satisfied any material
claims, liabilities or obligations (absolute, accrued or contingent) owed with
respect to the Business other than the payment, discharge or satisfaction in
the ordinary course of business and consistent with past practice of claims,
liabilities and obligations reflected or reserved against in the Financial


 


22





















 


Statements, or prepaid any material obligation owed with respect to the
Business having a fixed maturity of more than ninety (90) days from the
date such obligation was issued or incurred;


 


(ix)                                Permitted or allowed any of the Purchased
Assets or any of the material property or assets (real, personal or mixed,
tangible or intangible) of the Transferred Subsidiaries to be subjected to any
Lien except Permitted Liens or Liens that will be released prior to the
Transfer Date;


 


(x)                                   Sold, transferred or otherwise disposed of
any of the Purchased Assets or the material properties or assets (real,
personal or mixed, tangible or intangible) of the Transferred Subsidiaries with
an aggregate net book value in excess of $100,000, except the sale of inventory
in the ordinary course of business;


 


(xi)                                Disposed of or permitted to lapse any rights
to the use of any material trademark, trade name, patent or copyright currently
used exclusively in the conduct of the Business, or disposed of or disclosed to
any Person (other than representatives of Purchasing Entities or any other
Person subject to a confidentiality agreement or non-disclosure obligation) any
material trade secret, formula, process or know-how not theretofore a matter of
public knowledge, which was used primarily or exclusively in the conduct of the
Business;


 


(xii)                             Made any single capital expenditure or
commitment in excess of $150,000 for additions to property, plant, equipment or
intangible capital assets of the Business or made aggregate capital
expenditures in excess of $750,000 for additions to property, plant, equipment
or intangible capital assets of the Business;


 


(xiii)                          Accelerated the collection of any of its accounts
receivable or deferred the payment of any of its accounts payable outside of
the ordinary course of the Business; or


 


(xiv)                         Agreed, whether in writing or otherwise, to
take any action described in this Section 3.2(b).


 


(c)                                  Indebtedness


 


Set
forth on Schedule 3.2(c) is a list and
description of all notes, loan agreements and other instruments pursuant to
which any the Selling Entities in respect of the Business is obligated for
borrowed moneys (other than customary trade payables incurred in the ordinary
course of business) and the outstanding balance of principal and interest
thereunder as of the date indicated.


 


3.3                               Accounts
Receivable


 


(a)                                  December Balance
Sheet


 


As
of the date of this Agreement, all accounts, notes and drafts receivable
(including unbilled receivables) of the Business reflected in the December Balance
Sheet are bona fide,


 


23





















 


represent transactions actually made in the ordinary
course of business and, to the knowledge of the Selling Entities, are
collectible in the ordinary course of business, except to the extent of the
reserve for uncollectible accounts provided for in the December Balance
Sheet.


 


(b)                                  Closing Balance
Sheet


 


As
of the Transfer Date, all accounts, notes and drafts receivable (including
unbilled receivables) of the Business reflected in the Closing Balance Sheet
will be bona fide, represent transactions actually made in the ordinary course
of business and, to the knowledge of the Selling Entities, be collectible in
the ordinary course of business, except to the extent of the reserve for
uncollectible accounts provided for in the Closing Balance Sheet.


 


3.4                               Inventories


 


All
items of inventory reflected in the Closing Balance Sheet or as currently owned
by the Selling Entities or Transferred Subsidiaries primarily or exclusively
for use in the operation of the Business (a) have been valued in
accordance with the inventory valuation policy of the Business set forth on Schedule 3.4, and (b) are of a quality and
quantity usable and salable with respect to such inventory valuation policy.


 


3.5                               Absence
of Liens and Encumbrances


 


For
purposes of this Agreement, a “Lien” shall
mean any lien, encumbrance, mortgage, pledge, hypothecation, charge, or other
security interest in favor of any third party, other than defects, easements,
encroachments and encumbrances that do not, individually or in the aggregate,
materially impair value or continued use as currently conducted of the property
to which they relate.  “Permitted Lien” shall mean,
collectively, any (i) Liens for Taxes, assessments or governmental charges
or levies not yet due or being contested in good faith and any Liens for Taxes
disclosed on Schedule 3.18, (ii) statutory Liens of carriers, warehousemen,
mechanics, materialmen and the like arising in the ordinary course of business
that do not impair in any material respect the conduct of the Business or the
use of any of the Purchased Assets or the assets of the Transferred
Subsidiaries in the manner currently conducted or used, (iii) easements,
restrictive covenants, rights of way and other similar restrictions of record, (iv) zoning,
building and other similar restrictions, (v) easements, encumbrances,
encroachments and other minor imperfections of title that do not impair in any
material respect the continued conduct of the Business or the continued use of
any of the Purchased Assets or the assets of the Transferred Subsidiaries in
the manner currently conducted or used, (vi)  in the case of leased
property, all matters, whether or not of record, affecting the title of the
lessor (and any underlying lessor) of the leased property, (vii) any Lien
caused by a Purchasing Entity in connection with this Agreement, (viii) other
Liens set forth on Schedule 3.5,
(ix) Liens relating to deposits made in the ordinary course of business in
connection with workers’ compensation, employment insurance and other types of
social security, (x) Liens to secure the performance of leases, trade
contracts or other similar agreements and securing executory obligations under
any lease that constitutes an “operating lease” under GAAP, and (xi) Liens
to secure payment obligations in connection


 


24





















 


with purchased property in the ordinary course of
business.  Except as set forth on Schedule 3.5, each of the applicable Selling Entities
has good and marketable title to or, in the case of leased properties and
assets, valid leasehold interest in, all of the Purchased Assets, and each
Transferred Subsidiary has good title to, or in the case of leased properties
and assets, valid leasehold interest in, all of the material assets of such
Transferred Subsidiary used exclusively in the Business, in each case free and
clear of all Liens other than Permitted Liens. 
The Selling Entities and Transferred Subsidiaries own all of the assets
used by them in the operation and conduct of the Business, or required by them
for the normal conduct of the Business, except for those assets leased by them
under leases specifically identified on Schedule 3.6(b) hereto.  Except for the assets owned by the
Transferred Subsidiaries and the Excluded Assets, the Purchased Assets
constitute all of the assets used in, related to or required for the normal
conduct of the Business and of the Cincinnati Lamb Group.


 


3.6                               Real
Property.


 


(a)                                  Real Property


 


Set
forth on Schedule 3.6(a) is a
description of all real property with respect to which any of the Selling Entities
or Transferred Subsidiaries is the owner and holder of a fee simple, insurable
interest and is primarily or exclusively used in the Business, excluding any of
the Assets Held for Sale (collectively, the “Owned
Real Property”).


 


(b)                                  Realty Leases
(as Lessee)


 


Set
forth on Schedule 3.6(b) is a list and
description of all real property with respect to which any of the Selling
Entities or Transferred Subsidiaries is a lessee or sublessee or other occupant
and that is exclusively used in the Business (the “Leased
Real Property,” and, along with the Owned Real Property, the “Real Property”).  UNOVA has previously furnished to Purchaser true,
correct and complete copies of the leases or similar contracts governing the
Leased Real Property and any guaranties related thereto.  Each such lease is in full force and effect,
no default or breach has occurred on the part of the Selling Entities or, to
the knowledge of the Selling Entities, any other party thereto, nor has there
been any occurrence, omission or dispute which with the giving of notice or the
passage of time or both could give rise to a default of any such lease.  Except as set forth on Schedule 3.6(b), no consent of
any landlord or any other party is required under any such lease in order to
assign all rights and benefits in each such lease to Purchaser (or its
designee) and to keep such lease in full force and effect after the execution
and delivery of this Agreement and the consummation of the transactions
contemplated hereby.


 


(c)                                  Violation of
Laws or Restrictive Covenants


 


No
notice of violation of any applicable Law (including without limitation any
zoning and land use Law), covenant, condition, restriction, agreement or
easement affecting any Real Property owned, leased or occupied by any of the Selling
Entities or Transferred Subsidiaries or its use or occupancy, which violation
would materially impair the value or


 


25





















 


continued use of the property to which it relates
has been received by any of the Selling Entities in respect of the Business or
any Transferred Subsidiary by any Governmental Body or other person entitled to
enforce the same.


 


(d)                                  Environmental
Matters


 


Except
as otherwise disclosed on Schedule 3.6(d) or
in the Phase I or Phase II assessments undertaken by UNOVA pursuant
to Section 5.8:


 


(i)                                     The applicable Transferred Subsidiaries or
Selling Entities in respect of the Business have obtained and currently
maintain all material permits, licenses and other authorizations (the “Environmental Permits”) which are
presently required with respect to the operation of the Business or any Real
Property under applicable Law relating to pollution or protection of the
environment, including without limitation Laws and regulations relating to
emission, discharge or release of any “Hazardous Substance”
(as defined below) into the environment (including without limitation ambient
air, surface water, ground water, drinking water supply, land surface or
subsurface strata located both on and off-site) or otherwise relating to the
manufacture, processing, distribution, generation, use, removal, abatement,
remediation, treatment, storage, disposal, transport, recycling, reclamation,
management, handling, import or export of any Hazardous Substance (collectively,
the “Environmental Laws”).  The term “Hazardous
Substance” shall mean any toxic or hazardous constituents,
pollutants, waste waters, byproducts, contaminants, chemicals, compounds,
substances, materials or wastes, including without limitation asbestos, polychlorinated
biphenyls , petroleum or any petroleum products or other constituents or
petroleum-based derivatives or urea formaldehyde.  None of the Transferred Subsidiaries or
Selling Entities in respect of the Business has been notified by any Governmental
Body that any of the Environmental Permits will be materially modified or
suspended or revoked, and the Selling Entities have no reason to believe that
the Environmental Permits cannot be transferred or reissued to Purchaser or
renewed upon their expiration upon the same or similar terms and conditions as
the current permits, subject to requirements of applicable Environmental Laws
governing such Environmental Permits. 
Each of the Selling Entities and Transferred Subsidiaries is in material
compliance with the terms and conditions of the Environmental Permits
applicable to such Persons;


 


(ii)                                  Each of the Selling Entities and Transferred
Subsidiaries is in material compliance with all applicable limitations,
restrictions, conditions, standards, prohibitions, requirements, obligations,
schedules and timetables imposed or required by the Environmental Laws;


 


(iii)                               There is no civil, criminal or administrative
action, suit, demand, claim, hearing, notice of violation, order,
investigation, proceeding, notice or demand letter received by or pending , or
to the knowledge of the Selling Entities, threatened against any of the
Transferred Subsidiaries or Selling Entities in respect of any Real Property or
any site off the Real Property based on the Environmental Laws or any binding
code, plan, order, decree,


 


26





















 


judgment, injunction, notice or demand letter issued, entered or
promulgated under such Environmental Laws;


 


(iv)                              There has been no storage, holding, existence,
release, spill, emission, discharge, generation, processing, treatment,
abatement, removal, recycling, reclamation, disposal, handling, use or
transportation of any Hazardous Substance from, under, into, at or on any Real
Property (an “Environmental Activity”)
which has resulted or is reasonably likely to result in a violation by or a
material liability of any Transferred Subsidiaries or Selling Entities in
respect of the Business under the Environmental Laws, or which has resulted in
the contamination of any Real Property that is required by any Governmental
Body to be investigated, reported, removed or remediated under the
Environmental Laws; and


 


(v)                                 The Selling Entities have provided or will
provide Purchaser and Consultant (as defined in Section 5.8(a)) with
access to all environmental studies or reports, records, documentation and
information in the control of the Selling Entities relative to the
environmental condition of the Real Property, any Environmental Activity and
compliance with applicable Environmental Laws except for such records,
documentation and information considered to be subject to the attorney-client
privilege, provided that the withholding of such records, documentation and
information does not result in the non-disclosure of material information
regarding the environmental condition of the Real Property, any Environmental
Activity or the failure of the Business to comply with applicable Environmental
Laws.


 


(e)                                  Survey
Matters


 


With
respect to each of the properties which is an Owned Real Property (i) all
buildings, structures and improvements, including, without limitation, any
driveways, parking areas, waste facilities and all means of access to such
property, are located completely within the boundary lines of such property and
do not encroach upon or under the property of any other person or entity; (ii) no
building, structure or improvement of any kind belonging to any other person or
entity encroaches upon or under any of such property; (iii) the property
abuts and has access to a public way, duly laid out or accepted as such by the
city or town in which such property is located; (iv) the legal description
provided to the Purchaser with respect to such property comprises all the land
necessary to properly operate such property consistent with its respective use
prior to the date hereof; (v) no portion of such property is subject to
the possession or claim of ownership or use by any other person or entity other
than the respective Selling Entities or Transferred Subsidiaries; and (vi) there
are no rights, interests or claims affecting any such property which a correct
survey would disclose and which are not shown in the public records.


 


(f)                                    Real
Estate Liens or Encumbances


 


As
of the Transfer Date, except as disclosed in any title insurance policy
delivered to Purchaser prior to the consummation of the transactions
contemplated hereby, none of the Owned Real Property is subject to any
easements, covenants, restrictions and


 


27





















 


reservations (of record or otherwise), which prohibit or materially
interfere with the current or expected future use of such properties.


 


3.7                               Right
to Use Properties and Assets


 


Except
as would not reasonably be expected to have a material adverse effect, none of
the Selling Entities or Transferred Subsidiaries is using any properties,
rights or assets to conduct the Business which are not duly owned, leased,
licensed or otherwise contracted for by it.


 


3.8                               Contracts
and Commitments


 


The
agreements set forth on Schedules 3.8(a) through
3.8(k) are referred to herein as the “Contracts.”


 


(a)                                  Sales Orders,
Bids and Proposals


 


Set
forth on Schedule 3.8(a) is a list and
description of each individual outstanding sales order, sales contract, change
order, final bid or binding sales proposal of any of the Transferred
Subsidiaries or Selling Entities relating to the Business in excess of $250,000
(the “Sales Orders”).  UNOVA has provided Purchaser with access to
copies of all Sales Orders, except to the extent such access may be restricted
by applicable Laws or contract terms. 
Except as otherwise indicated on Schedule 3.8(a), all Sales Orders
currently in effect have been made in the ordinary course of business and at
arm’s length.


 


(b)                                  Purchase Orders


 


Set
forth on Schedule 3.8(b) is a list and
description of each individual outstanding purchase order and purchase
commitment of any of the Transferred Subsidiaries or Selling Entities relating
to the Business in excess of $100,000 (the
“Purchase Orders”).  UNOVA has provided Purchaser with access to
copies of all Purchase Orders.  Except as
otherwise indicated on Schedule 3.8(b),
all Purchase Orders have been incurred in the ordinary course of business and
at arm’s length.  Schedule 3.8(b) also contains a
true and complete list of (i) the twenty largest customers of the Selling
Entities in terms of revenues during the year ended December 31, 2004
showing the approximate total sales to each such customer during such period;
and (ii) the twenty largest vendors of the Selling Entities in terms of
purchases of goods or services during such period, showing the approximate
total purchases by the Selling Entities from each such vendor during such
period.


 


(c)                                  Sales
Representative, Distributor and Dealer Agreements


 


Set
forth on Schedule 3.8(c) is a list and
description of all outstanding sales representative, sales agent, dealer and
distributor agreements and similar contracts or agreements of any of the
Transferred Subsidiaries or Selling Entities relating to the Business.  All of such contracts and agreements by their
terms are terminable at any time by the applicable Selling Entity or
Transferred Subsidiary without any additional payment,


 


28





















 


indemnity or other penalty upon not more than
90 days notice, except as otherwise disclosed on Schedule 3.8(c).


 


(d)                                  Personal
Property Leases (As Lessee)


 


Set
forth on Schedule 3.8(d) are (i) a
list and description of each individual lease, contract and other agreement
under which any of the Transferred Subsidiaries or Selling Entities relating to
the Business leases or rents (as lessee) any machinery, equipment, motor
vehicle or other personal property and which is not terminable at any time by
the applicable Selling Entity or Transferred Subsidiary without any additional
payment, indemnity or other penalty upon not more than 90 days notice, and
under which the lease or rent payments exceed $10,000 annually, and (ii) a
list of each lease under which any of the Transferred Subsidiaries or Selling Entities
leases or rents (as lessee) any motor vehicle used in the Business.


 


(e)                                  Noncompetition
Agreements or Covenants


 


Set
forth on Schedule 3.8(e) is a list and
description of every agreement or other commitment imposing on any of the
Transferred Subsidiaries or Selling Entities any restriction on the manner in
which it may conduct the Business in competition with any third party.


 


(f)                                    Confidential
Nondisclosure Agreements


 


Set
forth on Schedule 3.8(f) is a list and
description of all written agreements between any of the Transferred
Subsidiaries or Selling Entities and any third party in respect of the Business
which contain provisions for the nondisclosure by any of the Transferred
Subsidiaries or Selling Entities of confidential or proprietary information
(excluding standard confidentiality provisions in product sales or service
agreements and excluding confidentiality agreements with potential purchasers
of all or any portion of the Cincinnati Lamb Group).


 


(g)                                 Consultant
Agreements


 


Set
forth on Schedule 3.8(g) is a list and
description of all outstanding consultant agreements (other than agreements
listed on Schedule 3.8(c)) of any of the
Transferred Subsidiaries or Selling Entities in respect of the Business.


 


(h)                                 Guarantees


 


Set
forth on Schedule 3.8(h) is a list and
description of each contract, agreement or instrument under which any of the
Transferred Subsidiaries or the Selling Entities guarantees, endorses or
otherwise is, will or may become liable or responsible for the obligations or
liabilities of any third party in respect of the Business for money borrowed,
advances made or goods or services purchased (other than endorsements for
collection of negotiable instruments in the ordinary course of business).


 


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(i)                                    Powers of
Attorney, Proxies


 


Set
forth on Schedule 3.8(i) is a list and
description of all outstanding powers of attorney or proxies granted by any of
the Transferred Subsidiaries or the Selling Entities in respect of the
Business.


 


(j)                                    Letters of
Credit, Surety, Bid and Performance Bonds


 


Set
forth on Schedule 3.8(j) is a list and
description of all commercial letters of credit, stand-by letters of credit,
surety, bid, performance bonds and other similar instruments (i) securing
the obligations of any of the Transferred Subsidiaries or Selling Entities in
respect of the Business or (ii) securing any outstanding payment
obligations of a third party to any of the Transferred Subsidiaries or Selling
Entities in respect of the Business.


 


(k)                                Other Material
Contracts


 


Set
forth on Schedule 3.8(k) is a list and
description of any other contract or commitment of any of the Transferred
Subsidiaries or Selling Entities in respect of the Business that is material to
the Business and which is not of the type required to be disclosed in any other
Schedule to this Agreement pursuant to the provisions hereof.  For purposes of this paragraph, a contract or
commitment shall be deemed to be material if the consideration remaining to be
paid thereunder exceeds $150,000 in the aggregate.


 


Except
as otherwise disclosed in this Section 3.8, all contracts listed in this Schedule 3.8
are valid and in full force and effect, the Transferred Entities or Selling
Entities have performed or are prepared to perform all material obligations
imposed on them thereunder, and there are not any defaults or events of default
on the part of the Transferred Subsidiaries or Selling Entities, or to their
knowledge the other parties thereto, that could reasonably be expected to materially
adversely affect the Business.  Except as
otherwise disclosed in this Section 3.8, none of the Transferred Subsidiaries
or Selling Entities has received notice that any party to any such contract
intends to cancel, terminate or refuse to renew such contract or to exercise or
decline to exercise any option or right thereunder.


 


3.9                               Patents,
Trade Names, Trademarks, Service Marks, Copyrights and Chip Registrations


 


(a)                                  Intellectual
Property Rights


 


Set
forth on Schedule 3.9(a) is a list and
description of all patents, registered designs, utility models, patent
applications, trade names, internet domains, trademarks, trademark
registrations and trademark applications, service marks, service mark
registrations and service mark applications, copyright registrations and
copyright registration applications, software, chip registrations and chip
registration applications, both domestic and foreign, which are owned by any of
the Transferred Subsidiaries or Selling Entities that are material to the
Business (collectively, the “Intellectual Property”).  To the knowledge of the Selling Entities and
except as otherwise indicated on Schedule 3.9(a), such Intellectual
Property is all


 


30





















 


of the intellectual property that is material and
necessary to operate the Business.  Except
as otherwise indicated on Schedule 3.9(a), the applicable Transferred
Subsidiary or Selling Entity owns all right, title and interest in and to the
Intellectual Property, validly and beneficially.  Also disclosed on Schedule 3.9(a) is
an indication of any of the Intellectual Property that is used by other
operations of UNOVA or its subsidiaries in operations other than the Business ,
together with a list of opposition proceedings, cancellation actions and
revocation actions (“Licensed Intellectual
Property”).


 


(b)                                  Licenses of
Intellectual Property Rights To or From
Third Parties


 


Set
forth on Schedule 3.9(b) is a list and
description of (i) all licenses, assignments and other transfers of
Intellectual Property granted to others by any of the Transferred Subsidiaries
or Selling Entities that are used in and material to the Business, and (ii) all
licenses, assignments and other transfers by others of patents, trade names,
trademarks, service marks, copyrights, chip registrations, trade secrets,
software, know-how, industrial property, technology or other proprietary rights
granted to any of the Transferred Subsidiaries or Selling Entities that are
used in and material to the Business. 
Except as otherwise disclosed on Schedule 3.9(b), none of the
licenses described above is subject to termination, cancellation or change in
its terms or provisions as a result of this Agreement or the transactions
provided for in this Agreement.


 


(c)                                  No Infringement


 


Except
as disclosed on Schedule 3.9(c) and
except with respect to pre-packaged or off-the-shelf-software, to the knowledge
of the Selling Entities, (a) none of the Intellectual Property or the
rights of any of the Transferred Subsidiaries or Selling Entities are being
infringed or otherwise violated by any Person, and (b) the use of such
Intellectual Property by the Cincinnati Lamb Group in connection with the
Business does not infringe or otherwise violate the rights of any other Person.


 


3.10                        Patent,
Trade Name, Trademark, Service Mark, Copyright or Chip Registration
Indemnification


 


Except
as set forth on Schedule 3.10, there are no
pending or, to the knowledge of the Selling Entities, threatened
indemnification claims or demands against any of the Transferred Subsidiaries
or the Selling Entities in respect of the Business for patent, registered
design, utility model, trade name, internet domain, trademark, service mark,
copyright or chip registration infringement.


 


3.11                        Confidential
Information or Trade Secrets


 


Except
as set forth on Schedule 3.11, there are no
pending or, to the knowledge of the Selling Entities, threatened proceedings
which challenge the rights of any of the Transferred Subsidiaries or Selling
Entities in respect of any proprietary or confidential information or trade
secrets used in and material to the Business.


 


31





















 


3.12                        Product
and Service Warranties


 


Set
forth on Schedule 3.12 are the standard
product and service warranty policies of the Transferred Subsidiaries and
Selling Entities in respect of the Business. 
Except as otherwise indicated on Schedule 3.12, none of the
Transferred Subsidiaries or Selling Entities has granted or extended any
currently outstanding product or service warranty, either in duration, scope or
otherwise, that is in excess of or different from the standard policies set
forth on Schedule 3.12.


 


3.13                        Employees;
Employee Benefits


 


(a)                                  Employees


 


Subject
to European data protection legislation, set forth on Schedule 3.13(a) is
a list of the names and titles of all employees of the Transferred Subsidiaries
and Selling Entities in respect of the Business as of the date of this
Agreement (the “Employees”).  UNOVA has previously furnished to Purchaser a
schedule showing the current rates of compensation of each of the
Employees.


 


(b)                                  Indebtedness to
Employees


 


None
of the Transferred Subsidiaries or Selling Entities in respect of the Business
is indebted to any of the present or former employees in any amount whatsoever,
other than for accrued wages, bonuses and related benefits and reasonable
reimbursable business expenses incurred in the ordinary course of business,
except as otherwise disclosed on Schedule 3.13(b).


 


(c)                                  Loans or
Advances to Employees


 


None
of the Transferred Subsidiaries or Selling Entities has outstanding and
unsatisfied, in whole or in part, any loan or advance to any of its present or
former employees, other than reasonable advances for business and related
expenses made in the ordinary course of business, except as otherwise disclosed
on Schedule 3.13(c).


 


(d)                                  Collective
Bargaining Agreements


 


Set
forth on Schedule 3.13(d) is a list
and description of all collective bargaining or similar agreements between any
of the Transferred Subsidiaries or Selling Entities and any group of Employees,
union or labor organization representing any Employees including any works
agreement.  To the knowledge of the
Selling Entities, no such agreement or understanding is presently proposed or
under discussion, except as otherwise disclosed on Schedule 3.13(d).


 


32





















 


(e)                                  Other Labor Matters


 


Each
of the Transferred Subsidiaries and Selling Entities in respect of the Business
is in compliance in all material respects with all applicable Laws relating to
employment, employment practices, terms and conditions of employment, wages and
hours.  Within the last two years, none
of the Transferred Subsidiaries or Selling Entities has experienced any union
organizing activity or any work stoppage due to any labor disagreement
with respect to the Employees.  There is
no strike, slowdown or stoppage pending or threatened against any of the
Transferred Subsidiaries or Selling Entities.


 


(f)                                    Employee
Benefit Plans


 


(i)                                    Generally


 


Set
forth on Schedule 3.13(f) is a list
and description of all employee benefit plans and commitments in effect for the
benefit of the present or former employees of the Cincinnati Lamb Group or any
group of such employees, or for the benefit of dependents of any of them (collectively,
the “Employee Benefit Plans”), including
without limitation any pension, life and dependent life, accidental death and
health insurance (including medical, dental and vision), hospitalization,
medical examination, savings, bonus, deferred compensation, incentive
compensation, holiday, vacation, severance pay, tax preparation assistance and
equalization, estate planning, pay-in-lieu, sick pay, sick leave, disability,
tuition refund, service award, company car, car allowance, scholarship, relocation,
patent award, living allowances, housing allowances, annual home leave costs,
employee assistance, travel, accident, dependent schooling and supplements,
fringe benefit and other employee benefit plans, contracts, policies or
practices providing employee or executive compensation or benefits.  None of the Transferred Subsidiaries or
Selling Entities in respect of the Business has committed to establish any
agreement or arrangement of the type required to be disclosed on Schedule 3.13(f),
except as otherwise indicated on such Schedule. 
Except as otherwise disclosed on Schedule 3.13(f), to the knowledge
of the Selling Entities, each of the Employee Benefit Plans complies, and has
been administered in compliance in all material respects, with all applicable
Laws.


 


(ii)                                ERISA Plans


 


UNOVA
has provided Purchaser with access to copies of (1) each Employee Benefit
Plan that is subject to ERISA, including amendments thereto (each, an “ERISA Plan”), or, in the case of any
unwritten ERISA Plan, a description thereof, (2) if applicable, the
current trust agreement for each ERISA Plan, including amendments thereto, (3) if
applicable, the most recent summary plan description for each ERISA Plan and
all modifications thereto, (4) if applicable, the most recent Form 5500
filed for each ERISA Plan, (5) if applicable, the most recent actuarial
valuation report prepared in connection with any ERISA Plan, and (6) if
applicable, the most recent determination letter received from the Internal
Revenue Service with respect to such ERISA Plan.  Except as otherwise disclosed on Schedule 3.13(f),
no ERISA Plan is a “multiemployer plan” (as defined in Section 3(37) or


 


33





















 


Section 4001(a)(3) of ERISA) and no Selling Entity or Transferred
Subsidiary has incurred any material withdrawal liability under Section 4201
of ERISA to any multiemployer plan that covered employees of the Cincinnati
Lamb U.S. Division during the last five years, which liability will not be
satisfied prior to Closing.  With respect
to each ERISA Plan (1) all payments due from any such plan (or from the
applicable Transferred Subsidiary or Selling Entity with respect to any such
plan) have been made, (2) the applicable Selling Entity or
Transferred Subsidiary has complied in all material respects with, and each
such ERISA Plan conforms in all material respects in form and operation to, all
applicable Laws, including without limitation ERISA and the Code and all
material reports and information relating to such ERISA Plan required to be
filed with any Governmental Body have been timely filed, (3) all material
reports and information required to be disclosed or provided to participants or
their beneficiaries have been timely disclosed or provided, (4) there have
been no prohibited transactions within the meaning of Section 406 of ERISA
or Section 4975 of the Code with respect to any ERISA Plan, (5) each
such ERISA Plan which is intended to qualify under Section 401 of the Code
has received a favorable determination letter from the Internal Revenue Service
with respect to such qualification or is the subject of an Internal Revenue
Service opinion letter that such ERISA Plan is established using a prototype
plan document, and to the knowledge of the Selling Entities, nothing has
occurred since the date of such letter that has or is likely to adversely
affect such qualification or exemption, and (6) to the knowledge of the
Selling Entities, there are no actions by any Governmental Body, suits or
claims pending (other than routine claims for benefits) or threatened with
respect to any ERISA Plan or against the assets of such ERISA Plan.  With respect to any Employee Benefit Plan
subject to Title IV of ERISA, except as disclosed on Schedule 3.13(f),
(1) all minimum funding contributions required under Section 302 of
ERISA and Section 412 of the Code have been timely made, (2) no
funding waivers have been received or requested from the IRS, (3) no
accumulated funding deficiency as described in Section 302(a) of
ERISA and Section 412(a) of the Code exists and (4) no notice of
intent to terminate has been filed and no amendment to treat such plan as
terminated has been adopted.  Except as
specifically designated as such in Schedule 3.13(f), no ERISA Plan
provides post-employment health or welfare benefits, except as required by Part 6
of Subtitle B of Title I of ERISA and Section 4980B of the Code (“COBRA”).


 


(iii)                            U.K. Pension Plans


 


UNOVA
has provided Purchaser in respect of the UNOVA Pension Fund, the Cincinnati
Machine Pension Plan and the Cincinnati Machine Supplementary Pension Plan
(collectively, the “U.K. Pension Plans”) with
access to copies of the most recent definitive deed and rules applicable
to each of the U.K. Pension Plans, all subsequent deeds of amendment and the
most recent explanatory booklet issued in relation to such Plans and applicable
to the Employees located in the U.K. (the “U.K. Employees”).  Particulars of all documents relating to, and
all benefits payable under the U.K. Pension Plans necessary to enable the Purchasing
Entities to quantify the liabilities they will assume under each such Pension
Plan have been provided to or made available to the Purchaser.  UNOVA or CMUK is the sole sponsoring or
participating employer in each of the CMUK Plan, the CMUK Supplementary Plan
and the Lamb Technicon section of the UPF (as defined in


 


34





















 


Section 5.11).  For purposes
of this paragraph, “Pension Arrangement” means
any occupational pension scheme or personal pension scheme as either expression
is defined in Section 1 of the Pension Schemes Act 1993 or any other
agreement or arrangement providing a pension or lump sum on death or
retirement.  The U.K. Pension Plans
are the only Pension Arrangement applicable to the U.K. Employees apart
from statutory plans.  Each of the
U.K. Pension Plans is approved as an exempt approved scheme within the
meaning of Chapter I of Part XIV of the Income and Corporation Taxes
Act 1988.  To the knowledge of the
Selling Entities, there is no ongoing claim or dispute relating to the
entitlement of any of the U.K. Employees under any of the
U.K. Pension Plans, other than routine and undisputed claims for
benefits.  All contributions which have
become due and payable to the U.K. Pension Plans in respect of the
Employees have been paid.  Only CMUK is a
participating employer in the CMUK Plan and the CMUK Supplementary Plan.  No amendment to any of the U.K. Pension Plans
shall be made prior to Closing, unless the Purchasing Entities have first
approved it, which approval will not be unreasonably withheld.


 


(g)                                 Employment
Contracts


 


Set
forth on Schedule 3.13(g) is a list of
all contracts between any of the Selling Entities in respect of the Business or
any Transferred Subsidiary and any of the Employees, excluding contracts
created by operation of law.  UNOVA has
furnished or made available to Purchaser copies of all such contracts.


 


3.14                        Pending
or Threatened Claims, Litigation and Governmental Proceedings


 


Set
forth on Schedule 3.14 is a list and description
of every complaint, suit, action, arbitration or regulatory, administrative or
governmental proceeding or investigation or any other proceeding or
investigation which is pending or, to the knowledge of the Selling Entities,
threatened in writing against any of the Transferred Subsidiaries or Selling
Entities in respect of the Business.  No
investigation, suit, action or other judicial or governmental proceeding is
pending or, to the knowledge of the Selling Entities, threatened before any
court or Governmental Body which may result in the restraint or prohibition of,
or the obtaining of substantial damages in connection with, this Agreement or
the consummation of the transactions provided for in this Agreement.


 


3.15                        Judgments,
Orders and Consent Decrees


 


Except
as set forth on Schedule 3.15, none of the
Transferred Subsidiaries or Selling Entities in respect of the Business is
subject to any judgment, order or decree of, or agreement with, a Governmental
Body that involves the transactions contemplated herein or that would have a
material adverse effect on the Business; and no such proceeding is pending or,
to the knowledge of the Selling Entities, threatened against any of the
Transferred Subsidiaries or the Selling Entities in respect of the Business.


 


35





















 


3.16                        Compliance
With Laws


 


Except
as otherwise disclosed on Schedule 3.16,
to the knowledge of the Selling Entities, the Business has been conducted and
is in compliance with, and the Purchased Assets are in compliance with, all
applicable Laws.


 


3.17                        Franchises,
Permits, Etc.


 


Except
as otherwise disclosed on Schedule 3.17,
the applicable Selling Entity or Transferred Subsidiary has obtained and is in
compliance in all material respects with all terms and conditions of all
governmental and business franchises, permits, licenses and other
authorizations that are necessary for it to conduct the Business as and where
it is now conducted.


 


3.18                        Taxes


 


Except
as otherwise disclosed on Schedule 3.18
, each of the Selling Entities and the Transferred Subsidiaries, and any
affiliated group within the meaning of Section 1504 of the Code (or
comparable provision of state, provincial, local or foreign Law) (“Affiliated Group”) of which each
such Selling Entity or Transferred Subsidiary is or has been a member (but only
for the taxable period during which the Selling Entity or Transferred
Subsidiary has been a member thereof), (i) has filed or caused to be filed
all material federal, state, provincial, local and foreign Tax returns,
reports, statements or other documentation (“Tax
Returns”) required to be filed by it with a Tax authority under
applicable federal, state, provincial, local or foreign Law, and (ii) has
timely paid or caused to be paid in full by the due date thereof all Taxes
shown to be due thereon.  All such Tax
Returns were at the time they were filed true, complete and correct in all
material respects.  There are no Liens
for Taxes on any of the Purchased Assets or the property or assets of the
Transferred Subsidiaries, except for Permitted Liens.  All deficiencies asserted or assessments made
by any Tax authority against each of the Selling Entities and the Transferred
Subsidiaries, and any Affiliated Group of which each such Selling Entity or
Transferred Subsidiary is or has been a member (but only for the taxable period
during which the Selling Entity or Transferred Subsidiary has been a member
thereof), have been fully paid, and there are no audits, investigations or
examinations by any Tax authority with respect to Taxes relating to the
Business or the Transferred Subsidiaries in progress, pending or, to the
knowledge of the applicable Selling Entity, threatened.  Each of the Transferred Subsidiaries has
established adequate reserves on its books and records in accordance with GAAP
for all Taxes not yet due and payable. 
For purposes of this Agreement, the term “Taxes”
means all domestic or foreign federal, state and local taxes of any kind,
including without limitation, income, capital gains, gross receipts, franchise,
employment, sales, use, license, property or withholding taxes, together with
all interest, penalties and additions imposed with respect to such
amounts.  Notwithstanding the foregoing,
each of the Selling Entities and the Transferred Subsidiaries expressly
disclaims any representation or warranty with respect to the amount, usability
or availability of any net operating loss carryforward or other Tax attributes
of the Transferred Subsidiaries.  There
are no Tax sharing agreements between the


 


36





















 


Transferred Subsidiaries on the one hand and the
Selling Entities (or any other party) on the other hand.  The Transferred Subsidiaries are not and have
not been a member of any affiliated, consolidated, combined or unitary group of
corporations that filed or was required to file an affiliated, consolidated,
combined or unitary Tax Return or has any Liability for the Taxes of any person
(other than an affiliated, consolidated, combined or unitary return of which
UNOVA is the parent) under Treasury Regulation Section 1.1502-6 or
any analogous or similar provision of law. 
UNOVA Canada is and New Intermec Canada will be duly registered under
subdivision (d) of Division I of Part IX of the ETA with respect to
the GST and its GST registration number will be provided to UNOVA prior to the
Transfer Date, and the Purchased Assets being sold by UNOVA Canada constitute
all or substantially all of the assets and property owned and primarily used by
UNOVA Canada or its successor in respect of its operations and business.


 


3.19                        Required
Consents


 


Set
forth on Schedule 3.19 is a list and
description of any material consent, approval or authorization of, or exemption
by, or filing with, any Governmental Body or Person that is required in
connection with the execution, delivery and performance of this Agreement and
the Related Agreements by the Selling Entities or required to be obtained by
the Transferred Subsidiaries.


 


3.20                        No
Breach of Statute or Contract


 


Neither
the execution and delivery of this Agreement, nor compliance with the terms and
provisions hereof by each of the Selling Entities will breach or violate any
applicable Law other than as explicitly referred to in this Agreement or any
Contract or other material instrument to which it, or Transferred Subsidiary,
is a party or by which any of its, or Transferred Subsidiaries’, properties,
rights or assets are bound, except as would not have a material adverse effect
on the Business.


 


3.21                        Insurance
and Banking


 


(a)                                  Insurance Policies


 


Set
forth on Schedule 3.21(a) is a list of
all insurance policies (including the terms of any self-insurance programs) and
bonds (excluding instruments referred to in Section 3.8(j)) in force for
the current policy year, with respect to the Business and the employees of the
Transferred Subsidiaries and Selling Entities in respect of the Business.  The Transferred Subsidiaries and Selling
Entities have, with respect to the Business, maintained adequate insurance
protection against all liabilities against which it is customary for
corporations engaged in the same or a similar business similarly situated to
insure.


 


(b)                                  Bank Accounts


 


Set
forth on Schedule 3.21(b) is a list of
the names and locations of all banks or similar financial institutions in which
any of the Transferred Subsidiaries in respect of the


 


37





















 


Business maintains an account, the account numbers
and the names of all persons authorized to sign checks, drafts or other instruments
drawn thereon.


 


3.22                        Broker’s
or Finder’s Fees


 


Except
for McDonald Investments, Inc. (“McDonald”),
no Person other than UNOVA and its Affiliates (and their respective directors,
officers and employees) has arranged, or participated in arranging, on behalf
of the Selling Entities or Transferred Subsidiaries, the transactions provided
for in this Agreement.  Except for
certain fees to McDonald (which will be the responsibility of the Selling
Entities), there are no broker’s or finder’s fees to be paid by any of the
Selling Entities in connection with the transactions provided for in this
Agreement.  None of the Selling Entities
has any knowledge of, and has taken no action that would give rise to, any
claim for a broker’s or finder’s fee to be paid by Mainco or Purchaser in
connection with the consummation of the transactions provided for in this
Agreement.


 


3.23                        Duty
of the Selling Entities to Make Inquiry


 


To
the extent that any of the representations and warranties made by the Selling
Entities in this Agreement are qualified by the knowledge or belief of the
Selling Entities, such knowledge or belief shall refer solely to the knowledge
and belief, after reasonable investigation, of the employees of the Selling
Entities and the Cincinnati Lamb Group listed on Schedule 3.23,
which Schedule includes all members of the management of UNOVA responsible
for the Cincinnati Lamb Group.


 


3.24                        Affiliate
Arrangements


 


In
each case with respect to the Business, except as otherwise disclosed in the
Schedules to this Agreement, the Selling Entities or Transferred Subsidiaries are
not a party to any loans, guarantees, Contracts, transactions, understandings
or other arrangements, whether written or oral, of any nature, with any of the
present or former Affiliates, shareholders, directors or officers of the
Selling Entities or Transferred Subsidiaries (“Affiliate Arrangements”), including without limitation any Affiliate
Arrangement under which any Selling Entity or Transferred Subsidiary (a) leases
any real or personal property (either to or from such Person); (b) is
obligated to purchase any tangible or intangible asset from or sell such asset
to such Person; (c) purchases products or services from such Person; or (d) pays
or receives commissions, rebates or other payments.  None of the present or former Affiliates,
shareholders, directors or officers of the Selling Entities or Transferred
Subsidiaries or any family member of any such Persons, (i) has been a
director, officer, partner, manager or member of, or has had any direct or
indirect material interest in, any Person which during the past three years has
been a customer or supplier of the Selling Entities or Transferred Subsidiaries
or has competed with or been engaged in any business of the kind being
conducted by the Selling Entities or Transferred Subsidiaries , or (ii) owns
or has any rights in or to any of the Purchased Assets or Transferred
Subsidiaries or rights used by the Selling Entities or Transferred Subsidiaries
in the conduct of their business.


 


38





















 


3.25                        Assets
of Cincinnati Lamb Group


 


Pursuant to the transactions contemplated by this
Agreement, including but not limited to the transfers of the Purchased Assets, Assumed
Liabilities, R&B Shares, CM Korea Shares and the UII Shares, Purchaser will
as of the Transfer Date receive all assets used in the Business other than (a) the
Excluded Assets, and (b) any contracts, agreements, franchises, licenses,
approvals, permits or other authorizations that are not transferable by their
terms or as a matter of Law.


 


3.26                        No
Knowledge of Other Liabilities; No Other Representations


 


(a)                                  No Knowledge of
Other Liabilities


 


None
of the Selling Entities is aware of any liabilities of the Cincinnati Lamb
Group other than those debts, liabilities or obligations that are (i) disclosed
in this Agreement, (ii) not required to be disclosed in this Agreement, or
(iii) the Excluded Liabilities.


 


(b)                                  Disclaimer of Other
Representations and Warranties


 


Except
for the representations and warranties expressly made by the Selling Entities
in this Agreement (including the Exhibits and Schedules), none of the Selling
Entities or any other person makes any express or implied representation or
warranty concerning the Business on behalf of the Selling Entities.  Without limiting the generality of the
foregoing, and notwithstanding any otherwise express representations and
warranties made in this Article 3, the Selling Entities and Transferred
Subsidiaries make no representation or warranty to Mainco or Purchaser with
respect to (a) any projections, estimates or budgets delivered to or made
available to Mainco or Purchaser of future revenues, expenses or expenditures
or future results of operations or (b) except as expressly covered by a
representation and warranty contained in this Article 3, any other
information or documents (financial or otherwise) made available to Mainco or
Purchaser or their counsel, accountants or advisers with respect to the
Business.  The representations and the
warranties of the Selling Entities contained in this Agreement do not contain
any untrue statement of a material fact or omit to state any material fact
necessary in order to make the statements and information contained herein or
therein not misleading.


 


3.27                        Competition Act (Canada)


 


The
value of the Canadian assets to be sold pursuant to this Agreement is not now
and at the time of Closing will not exceed $50,000,000 (Cdn.) as determined in
accordance with the Competition Act (Canada). 
Accordingly, the proposed transaction does not now and will not at the
time of Closing exceed the pre-merger notification threshold under the
Competition Act (Canada).


 


(Article 4 follows)


 


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ARTICLE 4.

Representations and Warranties of Mainco and Purchaser


 


Mainco
and Purchaser each represents and warrants to the Selling Entities as follows:


 


4.1                               Corporate
Matters


 


(a)                                  Due Organization


 


Purchaser
is a limited liability company duly organized, validly existing and in good
standing under the Laws of Delaware . 
Mainco is a corporation duly organized, validly existing and in good
standing under the Laws of Delaware of which Mo Meidar is a shareholder.  As of the Transfer Date, each of the Purchaser
Subsidiaries will be a corporation or limited liability company duly organized,
validly existing and in good standing under the Laws of its jurisdiction of
formation and will be a wholly-owned subsidiary of Purchaser.  Each of the Purchaser and Mainco is, and as
of the Transfer Date each of the Purchaser Subsidiaries will be, qualified to
do business and in good standing as a foreign corporation or foreign limited
liability company in each jurisdiction in which the failure to be so qualified
would have a material adverse effect.


 


(b)                                  Corporate Power
and Authority to Enter Into Agreement


 


Each
of Mainco and Purchaser has, and as of the Transfer Date each of the Asset
Purchasing Entities will have, the corporate power and authority to enter into
this Agreement and to consummate the transactions provided for in this
Agreement.


 


(c)                                  Due Execution
and Enforceability


 


The
execution, delivery and performance by and on behalf of each of Mainco and
Purchaser of this Agreement and the Related Agreements to which it is a party
have been duly and validly authorized and approved by all necessary corporate
or limited liability company action, and no other corporate action is necessary
or required to authorize it to execute this Agreement and such Related
Agreements and to perform its obligations under this Agreement and such Related
Agreements.  As of the Transfer Date, the
execution, delivery and performance by and on behalf of each Asset Purchasing
Entity of this Agreement and the Related Agreements to which it is a party will
have been duly and validly authorized and approved by all necessary corporate or
limited liability company action, and no other corporate or limited liability
company action will be necessary or required to authorize it to execute this
Agreement and such Related Agreements and to perform its obligations under this
Agreement and such Related Agreements.  This
Agreement and such Related Agreements constitute the valid and legally binding
obligations of each of Mainco and Purchaser, and as of the Transfer Date will
constitute the valid and legally binding obligations of each of the Purchaser
Subsidiaries, enforceable against each of them in accordance with its terms,
except to the extent the same may be limited by bankruptcy,


 


40





















 


insolvency, reorganization, moratorium or similar
laws affecting creditors’ rights generally or by general equitable principles.


 


(d)                                  No Conflict


 


With respect to each of Mainco and Purchaser, the
execution and delivery of this Agreement and the Related Agreements to which
such Person is a party do not, and the consummation by it of any of the
transactions contemplated hereby or thereby will not, and with respect to each
of the Purchaser Subsidiaries as of the Transfer Date, the execution and
delivery of this Agreement and the Related Agreements to which such Person is a
party will not, and the consummation by it of any of the transactions
contemplated hereby or thereby will not:


 


(i) conflict with or violate its articles of
incorporation, bylaws or other constituent documents;


 


(ii) violate any applicable Law of any Governmental Body; or


 


(iii) violate, conflict with, result in any breach of, or constitute a
default (or an event that, with notice or lapse of time or both, would
constitute a default) under any contract or judgment to which it is a party or
by which it is bound, except as would not be reasonably likely to result have a material
adverse effect on Mainco and the Purchaser.


 


4.2                               Required
Consents


 


Set
forth on Schedule 4.2 is a list and
description of any material consent, approval or authorization of, or exemption
by, or filing with, any Governmental Body or Person that is required in
connection with the execution, delivery and performance of this Agreement and
the Related Agreements by the Purchasing Entities, except for governmental and
business franchises, permits, reports, licenses and other authorizations
necessary to conduct the Business on the Transfer Date.  The acquisition of the Purchased Assets from
UNOVA Canada by the Purchaser or another Asset Purchasing Entity contemplated
by this Agreement is subject to notification, and not review, under the
Investment Canada Act (Canada).


 


4.3                               Claims,
Litigation and Governmental Proceedings


 


No
investigation, suit, action or other judicial or governmental proceeding is
pending or, to the knowledge of Mainco and Purchaser, threatened before any
court or Governmental Body which is likely to result in the restraint or
prohibition of, or the obtaining of substantial damages in connection with,
this Agreement or the consummation of the transactions provided for in this
Agreement.


 


4.4                               Broker’s
or Finder’s Fees


 


No
person or firm other than Mainco and its Affiliates (and their respective
directors, officers and employees), has arranged, or participated in arranging,
on behalf of Mainco and


 


41





















 


Purchaser or their Affiliates, the transactions
provided for in this Agreement.  There
are no broker’s or finder’s fees to be paid by Mainco or Purchaser or their
Affiliates in connection with the transactions provided for in this
Agreement.  Neither Mainco, Purchaser nor
any of their Affiliates has any knowledge of, and has taken no action which
would give rise to, any claim for a broker’s or finder’s fee to be paid by any
of the Selling Entities or Transferred Subsidiaries in connection with the
consummation of the transactions provided for in this Agreement.


 


4.5                               Subsidiaries


 


Purchaser
does not presently own or control, directly or indirectly, any interest in any
other corporation, association or other business entity except as set forth in Schedule 4.5. 
Purchaser is not a participant in any joint venture, partnership or
similar arrangement with any Person other than its senior lender.


 


4.6                               Solvency


 


On
and after the Transfer Date, Purchaser and each of the other Asset Purchasing
Entities will have adequate funds on hand, from its working capital or
currently available credit facilities, to pay the Purchase Price (including the
Secured Note) and to operate the Business and to pay, perform and discharge the
Assumed Liabilities as they become due and payable.  The Purchaser is not insolvent, and neither
the Purchaser nor any other Asset Purchasing Entity will be rendered insolvent
by the transactions contemplated by this Agreement.


 


4.7                               Sources
of Financing


 


Set
forth on Schedule 4.7 is a description of
all sources of financing that Purchaser and the other Asset Purchasing Entities
will have available to pay the Purchase Price and to perform the Assumed
Liabilities as they become due.


 


4.8                               WTO
Investor


 


Purchaser
represents that it, as well as any Asset Purchasing Entity purchasing Purchased
Assets or assuming Assumed Liabilities of UNOVA Canada hereunder, is a WTO
investor for purposes of the Investment Canada Act (Canada).


 


4.9                               Ultimate
Parent Entity


 


Each
of Mainco and Purchaser acknowledges on behalf of itself and the Asset
Purchasing Entities that (a) Moshe Meidar is the ultimate parent entity of
each such entity for purposes of the HSR Act (as defined in Section 5.6(a)),
and (b) that Moshe Meidar does not meet any Size-of-Party threshold under Section (a)(2)(B)(ii) of
the HSR Act.


 


(Article 5 follows)


 


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ARTICLE 5.

Certain Covenants Pending the Closing


 


5.1                               Full
Access


 


Mainco,
Purchaser and the other Asset Purchasing Entities and their authorized
representatives shall have reasonable access during normal business hours and
upon reasonable advance notice, but without unreasonably interrupting business,
to all the premises and to all books of account, records and properties of the
Cincinnati Lamb Group, including without limitation those relative to (a) the
December Financials and (b) the customers and suppliers to the
Business; provided, however, that Mainco, Purchaser and the other Asset
Purchasing Entities and their representatives agree that such access and
disclosure will not be permitted if it would (i) violate the terms of any
agreement by which any member of the Cincinnati Lamb Group or its Affiliates is
bound or any applicable Law, or (ii) cause competitive harm to any member
of the Cincinnati Lamb Group or any of their Affiliates if the transactions
contemplated by this Agreement are not consummated.  Subject to the foregoing limitations and the
requirements of this Agreement, including but not limited to Section 5.6,
UNOVA shall furnish or cause to be furnished to Purchaser and the other Asset
Purchasing Entities and their authorized representatives all information with
respect to the Business as Purchaser and the other Asset Purchasing Entities
may reasonably request.


 


5.2                               Carry
On In Regular Course


 


The
Selling Entities shall (and shall cause the Transferred Subsidiaries to) carry
on the Business in the ordinary course and consistent with past practices in
all material respects, except to the extent of any actions taken with the
consent of Purchaser, and except as required by the provisions of this
Agreement.


 


5.3                               Sales
Orders


 


The
Selling Entities shall not (and shall not permit the Transferred Subsidiaries
to), without the prior consent of Purchaser, which consent shall not be
unreasonably withheld or delayed, enter into any sales order, sales contract,
change order, final bid or binding sales proposal relating to the Business (“Sales Order”) other than (i) Sales
Orders entered into in the ordinary course of business not in excess of
$1,000,000 and which are not knowingly or intentionally bid at an anticipated
loss, or (ii) any Sales Orders that are substantially in accord with a bid
or sales proposal set forth on Schedule 3.8(a).
 If any Sales Order would require
approval under the UNOVA Approval policy, the Selling Entities shall not (and
shall not permit the Transferred Subsidiaries to), without the prior consent of
Purchaser, which consent shall not be unreasonably withheld or delayed, enter
into any such Sales Order, except as may be consistent with the ordinary course
of business and past practice.


 


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5.4                               Capital
Expenditures


 


The
Selling Entities shall not (and shall not permit the Transferred Subsidiaries
to), without the prior consent of Purchaser, which consent shall not be
unreasonably withheld or delayed, make any capital expenditures relating to the
Business unless such expenditure is made pursuant to a purchase order set forth
on Schedule 3.8(b) or is less
than $100,000.


 


5.5                               No
Increase in Compensation or Benefits


 


The
Selling Entities shall not (and shall not permit the Transferred Subsidiaries
to), without the prior consent of Purchaser, which consent shall not be unreasonably
withheld or delayed, (i) hire or employ any new salaried personnel of the
Business (other than replacements), (ii) grant any increase in the rates
of pay of any Employee (other than routine increases granted in the ordinary
course of business consistent with past practice), or (iii) by means of
any new or existing compensation or employee benefit plan increase the
compensation or amount or level of benefits of any Employee, other than, in
each case, any Employee whom the Parties agree will not be a Continuing
Employee.


 


5.6                               Consents


 


The
Parties, in cooperation and after consultation and mutual agreement, shall take
all reasonable action (without payment of any penalty or fee) required to
obtain all consents, approvals and agreements of, and to give all notices and
make all filings with, any third parties, including Governmental Bodies,
necessary to authorize, approve or permit the transfer to Purchaser of the
Purchased Assets, the Shares and the Assumed Liabilities as provided for in
this Agreement.  Without limiting the
foregoing, the parties will undertake the following promptly following the Agreement
Date:


 


(a)                                  HSR Act


 


If
applicable, UNOVA and Purchaser shall promptly file the Pre-merger Notification
and Report Form (“HSR Filing”)
required by the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as
amended (the “HSR Act”) in connection with
the transactions contemplated hereby, and shall promptly respond to any
requests for information.  In connection
with the efforts referenced herein, each of the Purchasing Entities on the one
hand, and each of the Selling Entities on the other hand, shall (i) use
its reasonable best efforts to cooperate in all respects with the other Parties
hereto in connection with any filing or submission and in connection with any
investigation or other inquiry, including any proceeding initiated by a private
party, regarding the transactions contemplated hereby, (ii) keep the other
Parties, including their counsel, as the case may be, informed of any material
communication by or to such party or its counsel from or to the Federal Trade
Commission (the “FTC”), the Antitrust Division
of the Department of Justice (the “DOJ”) or
any other Governmental Body and of any material communication received or given
in connection with any proceeding by a private party, in each case regarding
any of the transactions contemplated hereby, (iii) permit the other
Parties and their legal counsel to review, consult with each other in advance
of and consider in good faith the views of the other in connection with any
correspondence, filings


 


44





















 


or communications given by it to, or between it and,
the FTC, the DOJ or any other Governmental Body or in connection with any
proceeding by a private party, regarding the transactions contemplated hereby,
and (iv) permit the other Parties and their legal counsel to attend and
participate in, any meeting or conference with, the FTC, the DOJ or any such
other Governmental Body or, in connection with any proceeding by a private
party, with any other Person, regarding the transactions contemplated hereby.


 


(b)                                  German Merger Control


 


If
applicable, the parties shall promptly make the appropriate request with the
German Federal Cartel Office for approval of the transactions contemplated by
this Agreement, including in particular the transfer of the Purchased Assets
and Assumed Liabilities relative to Honsberg.


 


(c)                                  Korean Reports


 


To
the extent applicable, the parties shall promptly submit the appropriate reports
in Korea under the Foreign Investment Promotion Law and the Monopoly Regulation
and Fair Trade Law, including in particular the transfer of the CM Korea Shares.


 


5.7                               Conditions
Precedent


 


The
Parties shall use all reasonable efforts to assure that the conditions
precedent set forth in Articles 6 and 7 are satisfied or waived on or
prior to March 31, 2005, to the extent that satisfaction of such
conditions precedent is within their reasonable control.


 


5.8                               Environmental
Survey


 


(a)                                  Phase I and Phase II


 


UNOVA
shall perform, at its expense, a Phase I environmental assessment (the “Phase I”) on all parcels of
Owned Real Property and with respect to Honsberg’s leased factory in Remscheid,
Germany, and, if warranted based on the recommendation of the Consultant based
on the results of the Phase I an additional limited subsurface assessment (the “Phase II”)
of such areas of the Real Property warranting such further assessment, as the
Parties shall in detail and in good faith reasonably agree, provided that the Phase I (and the
Phase II, if applicable) shall be conducted by an independent
environmental consultant (the “Consultant”)
selected by UNOVA and reasonably acceptable to Purchaser (which acceptance
shall not be unreasonably withheld or delayed) and in a reasonable manner,
during normal business hours, and in such a way as to minimize the disruption
to the Business; provided, further, that
no Phase II assessment shall take place with respect to any matter
reflected, disclosed or described on Schedule 3.6(d) for
which UNOVA bears or would bear responsibility under Section 1.7(e).  UNOVA shall use reasonable efforts to cause
the Phase I assessments to be completed at least six days prior to the Transfer
Date, and to cause any required Phase II assessments to be completed within 120
days following the Transfer Date.  It is
understood and agreed that if the parties agree that if the result of the


 


45





















 


Phase II assessment is that the Consultant
recommends further investigation, UNOVA shall perform, at its sole expense,
such further subsurface investigation as recommended by the Consultant or as
otherwise agreed by the parties, and the results of such further investigation
shall be included in the final Environmental Report (as defined below) for that
parcel of Real Property.  The conclusions
of the Consultant based on the Phase I (and the Phase II, if
applicable) shall be reflected in a report prepared by the Consultant and
delivered to UNOVA, a copy of which UNOVA shall promptly furnish to Purchaser
(the “Environmental Report”),
together with the appropriate Consultant’s reliance letter entitling Purchaser
to rely on the Environmental Report.  Consultant
shall prepare a separate Environmental Report for each Owned Real Property.  The purpose of the Environmental Report is to
provide evidence of the condition of such Real Property prior to the Transfer
Date.  UNOVA shall provide to Purchaser
and the Consultant reasonable access to all material non-privileged (in the
sense of attorney-client privilege) documentation and information in its
possession relative to the environmental condition of the Real Property.


 


(b)                                  Environmental
Response Plan


 


To
the extent the Environmental Report identifies any physical condition at, on or
under the Real Property that gives Purchaser a reasonable basis to suspect the
presence of Hazardous Substances at levels or in quantities likely to give rise
to an obligation to report a release under Environmental Law or to conduct a
removal or remedial action under any applicable Environmental Law in effect as
of the Transfer Date or to require under applicable Environmental Law a
material upgrade or improvement to any treatment facilities associated with
permitted air and water discharge points, the Parties shall agree in good faith
upon an appropriate removal or remedial procedure at the cost of UNOVA (the “Environmental Response Plan”), which
Environmental Response Plan may involve further subsurface assessments, provided, however, that UNOVA, in its sole
discretion, after consultation with Purchaser, may make whatever notifications
of Governmental Bodies it believes are required by Environmental Law with
respect to any condition discovered before the Transfer Date, and Purchaser, in
its sole discretion, after consultation with UNOVA, may make whatever
notifications of Governmental Bodies it believes are required by Environmental
Law after the Transfer Date.  If
Purchaser and UNOVA fail to agree upon an Environmental Response Plan within
60 days of the issuance of the Environmental Report, the parties shall
attempt in good faith to resolve any disputes for a period of at least
30 days.  If at the end of such 30-day
period no resolution is achieved, Purchaser and UNOVA shall jointly select
another environmental consultant who shall resolve such dispute, which
resolution shall be final and binding on the Parties.  There shall be no precondition to any remedy
included in the Environmental Response Plan prepared pursuant to this
Agreement.  Selection of the remedy shall
be based upon the recommendations of the Consultant and current best available
techniques and technologies which are currently employed in remedial projects
of a similar nature.  UNOVA shall use its
reasonable best efforts to ensure that any action necessary to implement the
Environmental Response Plan will be performed with minimal disruption to the
Business.  Purchaser or subsequent owners
of the Owned Real Property will cooperate with all reasonable filing,
petitions, or other legal proceedings necessary to execute any actions pursuant
to the Environmental Response Plan.


 


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(c)                                  Restrictions
on Post-Closing Testing


 


Purchaser
agrees that, except for any required remediation or removal activities of
Hazardous Substances arising from the operation of the Business following the
Transfer Date, for a period of three years after the Transfer Date Purchaser
will not, and Purchaser will cause its Affiliates and its and its Affiliates’
respective acquirors or successors in interest (including any acquirors of real
property used in the Business) to not, conduct any “Subsurface
Environmental Investigation” (as defined below) unless (i) required
to do so by a Governmental Body, (ii) Purchaser has, based on actual
observation of physical conditions or documentary evidence, a reasonable basis
to believe that there are Hazardous Substances attributable to the operation of
the Business prior to the Transfer Date at levels or in quantities reasonably
likely to give rise to an obligation to report a release under Environmental
Law or to conduct a removal or remedial action under any applicable Environmental
Law, (iii) during any expansion, renovation or addition to a facility of
the Business, undertaken in the ordinary course, Purchaser discovers the
presence of Hazardous Substances attributable to the operation of the Business
prior to the Transfer Date at levels or quantities that are reasonably likely
to give rise to an obligation to report a release or to conduct a removal or
remedial action under any Environmental Law as in effect at the Transfer Date, (iv) in
response to a discharge or release of a Hazardous Substance following the
Transfer Date to the extent required by Environmental Law, or (v) reasonable
suspicion of the presence of Hazardous Substances exists as the result of a
Phase I or Phase II environmental assessment conducted by a subsequent
purchaser or potential purchaser of the subject property.  “Subsurface Environmental
Investigation” shall mean any qualitative environmental analysis
of the subsurface environment at or under Real Property to detect the presence
of Hazardous Substances, including any testing or analysis of the soil, the
subsurface geology, any known or suspected subsurface vessel or structure, or
any groundwater, whether in a perched or deep aquifer.


 


5.9                               Nondisclosure
by Purchaser


 


Each
of Mainco and Purchaser shall hold in confidence, and shall use all reasonable
efforts to cause its representatives and its Affiliates to hold in confidence,
between the Agreement Date and the Transfer Date, any and all confidential or
secret information in respect of the Business furnished to it, its
representatives or its Affiliates by any of the Selling Entities in connection
with this Agreement and not to disclose or publish such information without the
prior written consent of UNOVA.  In the
event that this Agreement is terminated and the transactions provided for in
this Agreement are abandoned as contemplated by Section 10.1, the terms of
that certain Confidentiality Agreement, dated May 25, 2004, between MTN
Capital Partners (“MTN”), a predecessor of
Mainco, and UNOVA (the “Confidentiality Agreement”),
shall remain in full force and effect, and Mainco and Purchaser confirm that
they will comply with MTN’s obligations thereunder as if it were substituted
for Mainco as a party thereto.


 


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5.10                        Status
of Purchaser’s Financing


 


Mainco
and Purchaser shall at all times keep the Selling Entities fully informed
regarding the status of the financing Purchaser is arranging in connection with
this Agreement.


 


5.11                        Reorganization
of U.K. Pension Plans


 


UNOVA UK will use reasonable
endeavors to establish prior to the Transfer Date (and if UNOVA UK has not done
so by the Transfer Date, the Purchasing Entity which immediately after Closing
becomes the employer of the Employees of the Lamb U.K. division shall
cause to be established as soon as practicable after the Transfer Date and, in
any event, within 2 months after the Transfer Date) an “occupational
pension scheme” as defined in Section 1 of the Pension Schemes Act 1993
which is capable of approval as an “exempt approved scheme” for the purposes of
Chapter I of part XIV of the Income and Corporation Taxes Act of 1988 (the “CMUK DC Plan”) which Employees of
the Lamb U.K. division as at the Transfer Date are able to join for future
pension benefits and life insurance benefits on the same terms and with the
same contribution and benefit structure as apply in respect of them as of the
Agreement Date in the Lamb U.K. defined contribution section of the UNOVA
Pension Fund (“UPF”), and the Purchaser
shall ensure that such Employees are invited prior to or within 2 months
after the Transfer Date to join the CMUK DC Plan with effect from a date no
later than the Transfer Date.  The relevant
Purchasing Entity shall procure that within 3 months after the Transfer
Date each such Employee who joins the CMUK DC Plan with effect from a date no
later than the Transfer Date is invited to transfer all their accrued benefits
in the UPF to the CMUK DC Plan and that the deadline for such invitation to be
accepted is at least one month, but no more than 2 months, after the date
of issue of the invitation.  The terms of
the invitation to transfer will be that the funds to be transferred from the
UPF in respect of an Employee will be the value of that Employee’s defined
contribution account held in the UPF at the time the transfer is made and that
the full amount received by the CMUK DC Plan in respect of that Employee will
be allocated to that Employee’s defined contribution account under the CMUK DC
Plan so that no charges, commissions or expenses are charged against the amount
allocated.  The terms of the invitation
to transfer will also require the CMUK DC Plan to provide guaranteed minimum
pensions of the same amounts as those payable under the UPF, together with the
increases in such pensions provided by the relevant Governmental Body which
will be lost on transfer, in respect of the Employees who accept the
invitation.  With respect to any Employee
who accepts this invitation to transfer, the relevant Purchasing Entity shall
cause the trustees of the CMUK DC Plan to accept the transfer on these
terms and shall ensure that the transfer is made as soon as practicable after
the deadline for acceptance of the invitation and, in any event, within 14 days
after any regulatory requirements and consents necessary for the transfer have
been met or obtained (which requirements and consents the relevant Purchasing
Entity shall use its best efforts to ensure are met or obtained as
soon as possible).  Neither Purchaser nor
any of its Affiliates shall take any action or assist any other person in any
manner which would result in the UPF having to pay a larger amount to the CMUK DC
Plan in respect of any such Employee than the amount contemplated above.


 


48





















 


The parties acknowledge that
UNOVA UK and CMUK are working to put arrangements in place so that the plan
setup and transfer referred to above and merger of the CMUK Supplementary Plan
into the CMUK Plan (as both expressions are defined in Section 8.4(b)(v))
are completed before the Transfer Date and the parties agree that UNOVA UK and
CMUK are permitted to continue this process after the Agreement Date.  The parties recognize and agree that the CMUK
DC Plan will have to be a contracted-out plan for at least one day to enable
the transfers contemplated by this Section 5.11 to take place.


 


5.12                        Purchaser
Subsidiaries


 


The Parties acknowledge that,
as of the date of this Agreement, the Purchaser has not yet formed any of the
Purchaser Subsidiaries.  Each of Purchaser
and Mainco hereby agree to take all steps reasonably necessary to (a) form
the Purchaser Subsidiaries as soon as possible or, with respect to Germany,
acquire a shelf company, (b) make the Purchaser Subsidiaries parties to this
Agreement, including providing for representations, warranties, covenants and
agreements equivalent to those made by the other Purchasing Entities under this
Agreement, and (c) obtain all franchises, licenses, approvals, permits and
other authorizations necessary to enable the Purchaser Subsidiaries to consummate
the purchase of the Purchased Assets and the assumption of the Assumed
Liabilities as contemplated by this Agreement.


 


5.13                        Planning
Act (Ontario)


 


The
provisions of this Agreement relating to the purchase and sale of Owned Real
Property in Ontario are entered into subject to the express condition that they
are to be effective only if the subdivision control provisions of the Planning
Act (Ontario) are complied with.  The
Selling Entities covenant to proceed diligently at their own expense to obtain
any necessary consent by Closing.


 


5.14                        Electronic
Registration of Owned Real Property


 


If
electronic registration (the “E-Reg”) is
mandatory in the Land Titles Office in which the Owned Real Property located in
Ontario is registered, the following provisions shall prevail, namely:


 


(a)                                  the Purchasing Entities’ solicitor and the
Selling Entities’ solicitor shall each be obliged to be authorized E-Reg users
and in good standing with the Law Society of Upper Canada, and are hereby
authorized by the parties hereto to enter into a document registration
agreement in the form adopted by the Joint LSUC-CBAO Committee on Electronic
Registration of Title Documents on April 15, 2002 or any replacement
thereof (hereinafter referred to as the “DRA”),
establishing the procedures and timing for completing this transaction, which
DRA shall be exchanged between the Selling Entities’ solicitor and the
Purchasing Entities’ solicitor no later than ten (10) days before the
Transfer Date;


 


(b)                                 the delivery and exchange of all closing
deliveries hereunder and the release thereof to the parties hereto shall be
governed by the DRA, pursuant to which the solicitor


 


49





















 


receiving any closing deliveries will be required to
hold same in escrow, and will not be entitled to release same except in strict
accordance with the provisions of the DRA;


 


(c)                                  it is expressly understood and agreed by the
parties hereto that an effective tender shall be deemed to have been made by
either party (the “Tendering Party”) upon the
other party (the “Receiving Party”) when the
solicitor for the Tendering Party has completed, in addition to all other
requirements to effect a valid tender in accordance with the provisions of this
Agreement and the DRA, all steps required by E-Reg in order to complete this
transaction that can be performed or undertaken by the Tendering Party’s
solicitor without the cooperation or participation of the Receiving Party’s
solicitor, and specifically when the Tendering Party’s solicitor has, wherever
possible, electronically “signed” the Transfer/Deed of Land and all other
instruments to be registered against title to the Property on the Transfer Date
for completeness and granted “access” to the Receiving Party’s solicitor.


 


(Article 6 follows)


 


50





















 


ARTICLE 6.

Conditions Precedent to the Obligations of the Purchasing Entities to Close


 


Each
and every obligation of the Purchasing Entities to be performed at Closing
shall be subject to the satisfaction of the following conditions:


 


6.1                               Representations
and Warranties True


 


The
representations and warranties made by the Selling Entities in this Agreement
shall be true and correct in all respects on the Transfer Date as if made again
and reaffirmed on such date, except where the failure of such representations
and warranties to be so true and correct would not reasonably be expected to
have or result in, individually or in the aggregate, a material adverse effect
on the Business; provided, however, that the
Selling Entities shall have the right to update the Schedules to this Agreement
for matters occurring in the ordinary course of the Business, so long as the
items disclosed on the updated Schedules do not constitute a material adverse
effect on the Business.


 


6.2                               Compliance
With Agreement


 


The
Selling Entities shall have performed and complied in all material respects
with all of the obligations under this Agreement which are to be performed or
complied with by them on or prior to the Transfer Date.


 


6.3                               No
Material Adverse Change; Net Working Capital


 


There
shall have been no material adverse change in the operations of the Business,
taken as a whole.  The net working
capital of the Selling Entities at the Transfer Date shall not be less than $130,500,000.


 


6.4                               No
Litigation


 


No
investigation, suit, action or other judicial or governmental proceeding shall
be pending or threatened before any court or Governmental Body which may result
in the restraint or prohibition or the obtaining of substantial damages in
connection with this Agreement or the consummation of the transactions provided
for in this Agreement, or that may adversely affect the Purchaser’s ability to
operate the Business after the Transfer Date.


 


6.5                               Proceedings
and Instruments Satisfactory


 


All
proceedings to be taken by the Selling Entities in connection with the
transactions provided for in this Agreement and the Related Agreements, shall
be reasonably satisfactory in form and substance to Mainco and Purchaser; and
the Selling Entities shall have made


 


51





















 


available to Mainco and Purchaser for examination
the originals or copies of all documents which Purchaser may reasonably request
in connection with said transactions.


 


6.6                               Consents
and Approvals


 


The
Parties shall have obtained all necessary and material authorizations, consents
and approvals required for the valid consummation of the transactions provided
for in this Agreement, and each of them shall be in full force and effect.  Without limiting the generality of the
foregoing, (i) if applicable, the time period under the HSR Act shall have
expired, and no adverse action shall have been threatened or instituted in
connection therewith, and (ii) if applicable, the German Federal Cartel
Office shall have approved or been deemed to have approved the transactions
provided for in this Agreement.


 


6.7                               Instruments
of Transfer


 


The
applicable Selling Entities shall have executed and delivered to Purchaser
bills of sale meeting all necessary requirements of United States and foreign
Laws (including an in-rem bill of sale under German law) and stock assignments
sufficient to transfer to the Purchasing Entities the Purchased Assets and the
Shares as well as deeds conveying the Owned Real Property to Purchaser, which
deeds shall be of the same type as originally used to convey the Owned Real
Property to the Selling Entity.  The
Selling Entities shall also deliver the following:


 


(a)                                  A certificate of the Secretary or an
Assistant Secretary (or local equivalent) of each of the Selling Entities
setting forth a copy of the resolutions duly adopted by their Boards of
Directors and stockholders authorizing and approving the execution and delivery
of this Agreement and the consummation of the transactions contemplated hereby;


 


(b)                                 Appropriate instruments authorizing Purchaser
to endorse in the name of the Selling Entities all checks, drafts, notes and
other instruments for the payment of money and to receive for the account of
the Purchasing Entities all proceeds thereof to which the Purchasing Entities
are entitled under this Agreement;


 


(c)                                  A certificate validly executed by a duly
authorized officer of the Selling Entities in a form reasonably acceptable to
Purchaser for purposes of satisfying Purchaser’s obligations under Treasury
Regulation Section 1.1445-2(c)(3);


 


(d)                                 A transfer agreement relating to assets
located in the United Kingdom in form and substance reasonably acceptable to
the parties; and


 


(e)                                  A Safety Standard Certificate for each of the
motor vehicles that form part of the Purchased Assets which are located in
Ontario.


 


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6.8                               Resignations
and Corporate Records


 


UNOVA
shall have delivered to Purchaser (i) the resignations, effective as of
the Transfer Date, of all of the officers and directors of each of the
Transferred Subsidiaries (other than those officers and directors, if any, who
Purchaser has designated to remain), and (ii) the corporate records of
each of the Transferred Subsidiaries, including without limitation its minute
book, registrar, stock certificates, files related to its corporate existence,
and certified copies of the articles of incorporation and by-laws (or their
substantial equivalents), as amended and in effect.


 


6.9                               Transitional
Services Agreement


 


UIASI
shall have executed and delivered to Purchaser agreements in the forms of Exhibit C-1 and Exhibit C-2
(together, the “Transitional Services
Agreements”) pursuant to which (i) the Cincinnati Lamb
Group shall continue to provide certain services to the Landis Grinding
division of UIASI and the Landis Lund division of UNOVA UK (whether or not such
divisions continue to be owned by UIASI and UNOVA UK, respectively), including
without limitation certain payroll services and the continued use of the Lamb
business system, and (ii) UNOVA shall provide certain services to the
Cincinnati Lamb Group on reasonable terms and conditions as set forth in the
Transitional Services Agreements.


 


6.10                        Title
Reports


 


Prior
to the Closing Date, Purchaser shall have obtained, at its expense, a
commitment for an owner’s policy of title insurance for the Owned Real Property
owned by the Selling Entities, in which the title insurance company issuing the
commitment shall agree to insure title to such Owned Real Property by a
standard ALTA policy with such endorsements as may be acceptable to Purchaser
to insure title to such Owned Real Property, including, without limitation,
easements and appurtenances thereto, showing good and marketable title in fee
simple to such Owned Real Property to be vested in Purchaser, free and clear of
all leases, tenancies, rights or claims on occupancy by others, Contracts,
mortgages, Liens and other evidences of indebtedness, except for Permitted
Liens or approved by Purchaser. 
Purchaser shall notify the Selling Entities of any matters which render
the title to any Owned Real Property unsatisfactory to Purchaser.  Nothing herein contained shall be deemed a
waiver by Purchaser of any objections or exceptions to, or defects in, the
title to any Owned Real Property arising after the date of such commitment and
prior to the Transfer Date.  The Selling
Entities agree to furnish such indemnities as may be required by the title
insurance company and affidavits or such other documents, in each case, as may
be required to vest in Purchaser good and marketable title in fee simple to
such Owned Real Property, free and clear as described above.


 


6.11                        Honsberg
Sublease


 


Honsberg
and the relevant Purchasing Entity shall have entered into an agreement on
terms and conditions satisfactory to the Parties for the sublease (the “Honsberg Sublease”)


 


53





















 


of the real property currently leased by Honsberg in
connection with the Business.  The
Honsberg Sublease shall be in full force and effect and shall have been
consented to by the landlord with respect to the Honsberg property.  Among other terms and conditions the Honsberg
Sublease shall contain (a) a covenant by Honsberg, upon the written
request and at the expense of the relevant Purchasing Entity, to exercise any
available renewal option(s) under the Honsberg master lease, and (b) a covenant
by the relevant Purchasing Entity to extend the term of the sublease for the
same period covered by any renewal option exercised by Honsberg at the
Purchasing Entity’s request.


 


(Article 7 follows)


 


54





















 


ARTICLE 7.

Conditions Precedent to the Obligations of the Selling Entities to Close


 


Each
and every obligation of the Selling Entities to be performed at Closing shall
be subject to the satisfaction of each of the following conditions:


 


7.1                               Representations
and Warranties True


 


The
representations and warranties made by the Purchasing Entities in this
Agreement shall be true and correct in all respects on the Transfer Date as if
made again and reaffirmed on such date, except where the failure of such
representations and warranties to be so true and correct would not have or
result in, individually or in the aggregate, a material adverse effect on the
Purchasing Entities.


 


7.2                               Compliance
With Agreement


 


Each
of the Purchasing Entities shall have performed and complied in all material
respects with all of the obligations under this Agreement which are to be
performed or complied with by it on or prior to the Transfer Date.


 


7.3                               No
Litigation


 


No
investigation, suit, action or other judicial or governmental proceeding shall
be pending or threatened before any court or Governmental Body which may result
in the restraint or prohibition, or the obtaining of substantial damages in
connection with this Agreement or the consummation of the transactions provided
for in this Agreement.


 


7.4                               Proceedings
and Instruments Satisfactory


 


All
proceedings to be taken by any Purchasing Entity in connection with the
transactions provided for in this Agreement, and all related documents, shall
be reasonably satisfactory in form and substance to the Selling Entities; and the
Purchasing Entities shall have made available to the Selling Entities for
examination the originals or copies of all documents which it may reasonably
request in connection with said transactions.


 


7.5                               Consents
and Approvals


 


The
Parties shall have obtained all necessary and material authorizations, consents
and approvals required for the valid consummation of the transactions provided
for in this Agreement, and each of them shall be in full force and effect.  Without limiting the generality of the
foregoing, (a) if applicable, the time period under the HSR Act shall have
expired, and no adverse action shall have been threatened or instituted in
connection therewith, (b) if applicable, the German Federal Cartel Office
shall have approved or been deemed to have approved the transactions provided
for in this Agreement, and (c) there shall have been received by CMUK
deeds irrevocably executed and delivered by the Purchaser and/or


 


55





















 


another Purchasing Entity and the trustees of the
relevant plan to substitute Purchaser and/or another Asset Purchasing Entity for
CMUK as principal employer of the CMUK Plan, the CMUK Supplementary Plan and
the CMUK DC Plan, which deeds shall be in the form set out in Exhibit D in respect of the Cincinnati Machine Pension
Plan and in a form reasonably acceptable to the Selling Entities and the
Purchaser, but consistent with the principles reflected in the deed set out in Exhibit D, in respect of the CMUK DC Plan and the
Cincinnati Machine Supplementary Pension Plan (the “Plan
Deeds”).  If the UK Inland
Revenue does not approve any of the substitutions referred to in (c) of
this Section 7.5, the Purchaser shall procure that a company acceptable to
the UK Inland Revenue and the trustees of the relevant plan is made principal
employer of that plan with effect from the Transfer Date on materially the same
terms as contained in the Plan Deeds.


 


7.6                               Purchase
Price


 


Mainco
shall have delivered to UNOVA the R&B Cash Payment, and Purchaser shall
have delivered to UNOVA the following:


 


(a)                                  The Cash Payment; and


 


(b)                                 The Secured Note, duly executed by Purchaser.


 


7.7                               Instruments
of Assumption


 


Purchaser
and the other Asset Purchasing Entities shall have executed and delivered to
the applicable Selling Entities instruments of assumption sufficient for
Purchaser and the other Asset Purchasing Entities to assume the Assumed
Liabilities applicable to the Purchased Assets acquired by them respectively.  The Purchasing Entities shall also deliver a
certificate of the Secretary or an Assistant Secretary (or local equivalent) of
each of such Persons setting forth a copy of the resolutions duly adopted by
their Boards of Directors authorizing and approving the execution and delivery
of this Agreement and the consummation of the transactions contemplated hereby


 


7.8                               Performance
Bonds


 


Each
of Purchaser and the other Purchasing Entities shall have substituted its
credit (and the credit of the Cincinnati Lamb Group) for the credit of UNOVA or
its subsidiaries under any instrument or agreement (the “Performance
Bonds”) securing the obligations of the Cincinnati Lamb Group
under any of their executory contracts, including without limitation those
contracts and agreements set forth on Schedules 3.8(h) and
(j), for the face amount of the
Performance Bonds in the aggregate amount of $9,000,000 plus the amount of any
Performance Bonds related to bid tenders that are not cancelable within 30 days
following the Transfer Date (the “Required Performance Bond
Amount”); provided, however,
that to the extent that such substitution is not feasible on the Transfer Date,
Purchaser and the other Purchasing Entities shall have provided backup letters
of credit acceptable to UNOVA and the issuers of the applicable Performance
Bonds (“Backup L/Cs”) in the
aggregate amount of the Required Performance Bond Amount.


 


56





















 


7.9                               Transitional
Services Agreements


 


Purchaser
and any other Purchasing Entities who are parties to a Transitional Services
Agreement shall have executed and delivered to UIASI the Transitional Services
Agreements.


 


7.10                        Consent
of UNOVA’s Lender


 


UNOVA
shall have received the consent of its senior lender to the transactions
provided for in this Agreement.


 


 


(Article 8 follows)


 


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ARTICLE 8.

Further Requirements


 


8.1                               Access
to Books and Records


 


(a)                                  From and after the Agreement Date, the
Purchasing Entities and their authorized representatives shall have reasonable
access, during normal business hours and upon reasonable notice, to inspect and
examine and the right to photocopy all books of account and records of the
Selling Entities in respect of the Business or the Transferred Subsidiaries
that relate to the affairs and business of the Cincinnati Lamb Group conducted
on or prior to the Transfer Date; provided
that such inspection, examination and photocopying shall be conducted so as not
to unreasonably interfere with the Business.


 


(b)                                 From and after the Transfer Date, the Selling
Entities and their authorized representatives shall have reasonable access,
during normal business hours and upon reasonable notice, to inspect and examine
and the right to photocopy all books of account and records transferred to the
Purchasing Entities pursuant to this Agreement that relate to the affairs and
business of the Cincinnati Lamb Group conducted on or prior to the Transfer
Date; provided that such inspection, examination and photocopying shall be
conducted so as not to unreasonably interfere with the Business.  To the
extent that any books and that constitute Excluded Assets pursuant to Section 1.2(h) are
commingled with the books and records transferred to the Purchasing Entities
hereunder, the Purchasing Entities shall notify the applicable Selling Entities
before destroying any of such books and records and shall afford the Selling
Entities a reasonable opportunity to photocopy or take possession of the same.


 


8.2                               Further
Instruments and Assurances


 


From
and after the Agreement Date, each of the Parties shall use it reasonable best
efforts to take, or cause to be taken, such other action as may be required to
fully and effectively carry out the transactions contemplated by this
Agreement.


 


8.3                               Litigation
Cooperation


 


(a)                                  Specified
Litigation


 


Set
forth on Exhibit E is a list of certain
Employees (the “Litigation Required Employees”)
whose assistance and cooperation is required in connection with the pending
litigation specified on Exhibit E
(the “Specified Litigation”), and the
percentage of each such Employee’s time estimated to be required to provide
such assistance and cooperation. 
Purchaser and the other Purchasing Entities agree to continue the
employment in the Business of each of the Litigation Required Employees at no
less than their current level of compensation until such time as the Specified
Litigation has been fully and finally resolved (the “Litigation
Termination Date”); provided,
however, that during such time, UNOVA shall reimburse Purchaser and
other Purchasing Entities, as applicable, for the percentage of


 


58





















 


the direct compensation (salary and fringe benefits)
of the Litigation Required Employees specified on Exhibit E
and reasonable out-of-pocket costs incurred by those Employees in participating
in the Specified Litigation; and provided further, that
if Purchaser or another Purchasing Entity would not offer to employ or would
terminate any of the Litigation Required Employees but for this Section 8.3(a),
UNOVA shall reimburse Purchaser or another Purchasing Entity, as applicable, for
the full salary and fringe benefits of such employee, but in such case, neither
Purchaser nor any Purchasing Entity shall require such employee to work in the
Business.  If any of the Litigation
Required Employees is terminated by Purchaser or any other Purchasing Entity within
30 days following the Litigation Termination Date, UNOVA shall reimburse
Purchaser or the applicable Purchasing Entity for the severance payable to such
individual to the extent of any severance that would be payable to such
individual under UIASI’s severance plan if he were terminated on the Transfer
Date.


 


(b)                                  Other
Retained Litigation


 


Purchaser
and the other Purchasing Entities shall, at the request of UNOVA and without
charge to the Selling Entities, use their best efforts to assist and cooperate
fully with the Selling Entities in connection with the defense and settlement
of all Retained Litigation other than the Specified Litigation (the “Other Retained Litigation”).  Such assistance and cooperation shall include
without limitation making the relevant books and the relevant Continuing
Employees available to the Selling Entities.


 


(c)                                  Unknown
Litigation


 


Except
as provided in Section 8.3(a) and (b) above with respect to
Specified Litigation and the Other Retained Litigation, if any Party is a party
to any suit, action, proceeding or investigation concerning the Business
conducted on or prior to the Transfer Date (excluding any such suit, action,
proceeding or investigation between any of the Selling Entities, on the one
hand, and any Purchasing Entity, on the other hand), the Parties shall, upon
the request of the Party involved in such litigation and without charge to such
Party, use their best efforts to assist and cooperate fully with such Party in
connection with such litigation.


 


(d)                                  Control
of Retained Litigation


 


Notwithstanding
anything to the contrary contained in this Agreement, the Selling Entities
shall have control of the defense, investigation and settlement of the Retained
Litigation; provided however, that the Selling
Entities shall not make any admission of liability or enter into any
settlement, adjustment or compromise of any Retained Litigation without the
prior written consent of the applicable Purchasing Entities, which consent
shall not be unreasonably withheld or delayed, if as a result of such
admission, settlement, adjustment or compromise an injunction or other
non-monetary relief would be imposed against any of the Purchasing Entities.


 


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8.4                               Certain
Employee Matters


 


(a)                                  Employment


 


(i)                                    The Selling Entities and the Purchaser
acknowledge and agree that the German Civil Code and the Transfer of
Undertakings (Protection of Employment Regulations) 1981 (“TUPE”)
apply to the sale of Honsberg, UNOVA UK and CMUK respectively (collectively,
the “Transferring Selling Entities”) and
that accordingly all the rights, powers, duties and liabilities under or in
connection with any contract of employment with the Employees assigned to the
Transferring Selling Entities (the “Transferring Employees”)
still in force immediately before the Transfer Date shall be transferred to the
Purchaser with effect from the Transfer Date. 
The Purchaser will (subject to the terms of this Agreement) comply with
the requirements of the German Civil Code and TUPE in relation to the
Transferring Employees.


 


(ii)                                To the extent that it has not already done so
as of the date of this Agreement, the Purchaser shall provide the Transferring
Selling Entities with information which the Purchaser is required to supply
pursuant to Regulation 10(3) of TUPE, and subject to the provision of
such information, UNOVA UK and CMUK agree to comply with their obligations
under Regulation 10 of TUPE.


 


(iii)                            Without prejudice to the Transferring
Employees referred to above, as soon as practicable following the Agreement
Date, Purchaser or the applicable Purchasing Entity shall offer employment (and
with respect to the Employees of the Transferred Subsidiaries, shall cause the
Transferred Subsidiaries to continue their employment) as of the Transfer Date
to all of those Employees who are not Transferring Employees at their current
work sites or a work site in the same country and not more than 35 miles from
the current site, at their current rates of pay and with fringe benefits that
in the aggregate are comparable to those that they currently receive.  Those Employees who are not Transferring
Employees and who accept such offer (or who continue to be employed by either
of the Transferred Subsidiaries) are referred to collectively as the “Continuing Employees.”  Nothing in this Agreement requires Purchaser
or any Purchasing Entity to maintain any Continuing Employee’s employment
(other than the Litigation Required Employees) for any minimum period, nor
prohibits Purchaser or any Purchasing Entity from requiring employees from time
to time to spend up to sixty percent (60%) of their work time at locations that
are in a different country or more that 35 miles from their existing work site,
if reasonably required for the efficient operation of the Business under
circumstances that are permissible under local labor Laws.  Nothing in this Agreement creates any
third-party beneficiary rights with respect to employment of any Employee.  The preceding sentences are deemed modified
to the extent inconsistent with the German Civil Code and TUPE.


 


(iv)                               The Purchaser Subsidiary acquiring the
Purchased Assets from Honsberg will inform the Employees of Honsberg of the
transfer of the business and the transfer of their employment relationships to
such Purchaser Subsidiary pursuant to and with the required content provided in
Section 613a Para 5 German Civil Code prior to the Transfer Date.  If


 


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any of the Employees of Honsberg object to such
transfer of employment, or subsequently bring claims against Honsberg in
connection with the transfer of their employment to the Purchaser, the
Purchaser shall indemnify Honsberg from all such claims, obligations and
liabilities in connection with the continuation, the termination and/or the
winding-up of the respective employment relation.  Apart therefrom, Honsberg will use reasonable
endeavors to provide all necessary information, assistance and support in order
to enable the Purchaser Subsidiary to properly fulfill the information
requirements according to Section 613a Para 5 German Civil Code.


 


(v)                                   Each of UNOVA UK and CMUK undertakes to the
Purchaser and the applicable Purchasing Entity that it shall comply in all
respects with Part IV of the Trade Union and Labour Relations
(Consolidation) Act of 1992, and that it shall use reasonable efforts to
provide to the Purchaser or the applicable Purchasing Entity such information
as the latter may reasonably request in writing to verify such compliance.


 


(vi)                               The Parties further agree that (A) the
provisions of this Section 8.4(a) are deemed modified to the extent
inconsistent with the Korean Labor Standards Act and the Labor Union and Labor
Relation Adjustment Act, if applicable, (B) the Purchaser or the
applicable Purchasing Entity shall not dismiss any Employees of CM Korea
without a justifiable reason under Korean law, and (C) the Purchaser or
the applicable Purchasing Entity shall not modify the employment terms and
conditions of CM Korea’s employees, unless such modification is made in
accordance with the employment regulations of CM Korea or with prior written
consent thereto by the labor union, if any, or the majority of CM Korea’s
Employees.


 


(b)                                  Certain Employee
Benefits


 


(i)                                    Past Service
Credit


 


Purchaser
and any applicable Purchasing Entity shall credit the Continuing Employees with
their respective years of continuous service with UNOVA or its Affiliates for
purposes of eligibility and vesting under Purchaser’s or the applicable
Purchasing Entity’s employee benefit plans.


 


(ii)                                Benefits under
the Selling Entities’ Plans


 


The
Selling Entities shall cease accrual of benefits as of the Transfer Date with
respect to any Continuing Employee under any of their employee benefit plans
that are not assumed by Purchaser or any Purchasing Entity.  Purchaser or the applicable Purchasing Entity
shall cause to be paid when due the obligations to any Continuing Employee
under any employee benefit plan of the Selling Entities that are included in
the Assumed Liabilities.


 


(iii)                            U.S. Medical
and Health Plan


 


Purchaser
will have in effect in the United States by December 31, 2005 a group
insurance program under which Employees of the Cincinnati Lamb
U.S. division (the


 


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“U.S. Employees”) will be
permitted to participate in benefits consisting of medical, hospital, life and
dental insurance benefits.  Eligibility
for, the benefits of (including the reservation by Purchaser of the right to
terminate or amend such program in whole or in part at any time), and the
amount, if any, of employee contributions toward, such group insurance program
will be determined by Purchaser except that the Purchaser’s group insurance
with respect to U.S. Employees will:


 


(A)                              Waive application of its pre-existing
conditions provision to any U.S. Employee or covered dependent for any
medical condition such U.S. Employee or covered dependent has as of the
Transfer Date unless such condition was or would have been excluded from
coverage as a pre-existing condition under the applicable Selling Entity’s
group insurance program covering such U.S. Employee or covered dependent
as of the Transfer Date; and


 


(B)                                Credit each U.S. Employee in the
Purchaser’s program plan year with eligible expenses incurred by, and claims
paid on behalf of, such U.S. Employee in the current program plan year of
the Selling Entity’s group insurance program applicable to such Employee for
purposes of satisfying the deductible provisions, the out-of-pocket maximum
provisions and the maximum coverage provisions of the Purchaser group insurance
program, but only to the extent the Purchaser program plan year overlaps with
the applicable Selling Entities current program plan year.


 


(iv)                               Purchaser’s
401(k) Plan


 


Purchaser
shall offer all Continuing Employees the opportunity to enroll in Purchaser’s
401(k) plan (the “Purchaser’s
401(k) Plan”) subject to the enrollment requirements of the
Purchaser’s 401(k) Plan.  Except as
otherwise provided below with respect to the “FSSP/UPP
Transition Period” (as defined below), as soon as Purchaser
shall have reasonably concluded that UNOVA’s 401(k) plan (the “FSSP”) is tax-qualified, it shall
cause the Purchaser’s 401(k) Plan to accept the direct rollover of the
pre-tax account balance under the FSSP of any Continuing Employee who elects to
enroll as an active participant in the Purchaser’s 401(k) Plan and to have
such account balance transferred to the Purchaser’s 401(k) Plan.  UNOVA shall cause the Plan Administrator
designated under the FSSP to extend the repayment period of a loan of any
Continuing Employee from 30 days to 90 days following the Transfer
Date, it being understood that any such loan that is not repaid by the end of
the calendar quarter after the calendar quarter when the most recent
installment was due will be deemed to be in default.  If requested by Purchaser and if legally
permissible, UNOVA shall permit the employees of the Cincinnati Lamb U.S.
division who become Continuing Employees to continue to participate in the FSSP
and the UNOVA Pension Plan (the “UPP “) for a period of up to six months
following the Transfer Date (the “FSSP/UPP Transition Period”)
“; provided that in such event, Purchaser shall pay to UNOVA (or, in the sole
discretion of UNOVA, directly to the FSSP or the UPP, as the case may be) the
contributions, costs and administrative charges relative to the benefits earned
by such employees while participating in the FSSP and UPP during the FSSP/UPP
Transition Period.  The payments of
contributions, costs and administrative charges described in the preceding


 


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sentence shall be made promptly after each payroll period.  In the case of contributions relative to
benefits earned by Continuing Employees under the FSSP, payments for each
payroll period shall include all employee contributions and related employer
matching contributions for such payroll period. 
In the case of contributions relative to benefits earned by Continuing
Employees under the UPP, payments for each payroll period shall include a
pro-rata portion of the required annual employer contribution to the UPP,
determined by dividing the projected annual employer contribution to the UPP
for Continuing Employees (as determined by the actuary for the UPP) by the
number of payroll periods over which Continuing Employees accrue benefits in
the UPP during the year.  In the event
that Purchaser fails to make such payments as required, UNOVA shall be entitled
to immediately terminate the participation of such employees in the FSSP and
UPP.  Purchaser shall take all steps
required to maintain the tax-qualified status of the FSSP and the UPP (as
determined by UNOVA in its sole discretion, and including, if necessary,
adopting the FSSP and UPP as a co-sponsor), and shall cooperate with UNOVA in
making any filings required by any Governmental Body with respect to the FSSP
and the UPP.


 


(v)                                   U.K. Pension
Plans


 


Effective
as of the Transfer Date, Purchaser will procure that one of the Purchasing
Entities shall substitute itself as the principal employer under, and assume
responsibility for and for debts and liabilities arising under the Cincinnati
Machine Pension Plan (the “CMUK Plan”),
the Cincinnati Machine Supplementary Pension Plan (the “CMUK
Supplementary Plan”), and CMUK DC Plan and shall  on or before the Transfer Date execute and
deliver to CMUK Plan Deeds to effect such substitution.  The relevant Purchasing Entity shall be
responsible for any accrued contributions payable to the CMUK Plan.


 


(c)                                  Certain
Retained Responsibility


 


UNOVA
shall bear and discharge any and all liability to any present or former
employee of the Cincinnati Lamb Group arising from his or her employment by the
Cincinnati Lamb Group accrued on or prior to the Transfer Date under the
Employee Benefit Plans, except where liability is transferred to the CMUK DC
Plan or as otherwise provided in Sections 5.11 and 8.4(b)(v) with
respect to the U.K Pension Plans and as provided in Section 1.6(l)
with respect to FAS 106 Liabilities.


 


(d)                                  WARN Act


 


Purchaser
and the Purchasing Entities shall comply with the applicable provisions of the
Worker Adjustment and Retraining Notification Act of 1988 and any similar
federal, state or local Law, regarding the Employees and their employment with
Purchaser or any Purchasing Entity following the Transfer Date, and shall
indemnify the Selling Entities in respect thereof.  The Selling Entities shall comply with the applicable
provisions of the WARN Act and any similar federal, state or local law
regarding the Employees and their employment with the Selling Entities prior to
or as of the Transfer Date, and shall, subject to


 


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satisfaction of the covenants of the Purchasing
Entities in Section 8.4(a), indemnify Purchaser and Purchasing Entities
for their Losses in respect thereof.


 


(e)                                  Certain
Agreements Regarding Severance


 


(i)                                     Purchaser and the applicable Purchasing
Entity shall be responsible for any severance and other amounts payable to any
Employee below the level of Director to whom Purchaser or the applicable
Purchasing Entity does not offer employment or offers employment at a location
in the same country that is over 35 miles from his or her work site on the
Transfer Date or offers employment in another country, in each case, on the
terms set forth on Exhibit F
(the “Severance Terms”); provided, however, that the Selling
Entities shall be responsible for all severance payable pursuant to any
individual written employment agreements other than written employment agreements
with Honsberg, UNOVA UK and CMUK for Employees below the executive officer
level.  Each of the Purchaser and the
applicable Purchasing Entities covenants and agrees that if an Employee at or
above the Director level is not offered employment pursuant to this Agreement
and is paid severance by any of the Selling Entities under this Section 8.4(e),
then for a period of 12 months following the Transfer Date the Purchaser and
the Purchasing Entities shall not, and shall not permit any of their Affiliates
to, hire or otherwise employ such Employee. 
In the event that any Continuing Employee at the level of Director or
above is terminated by Purchaser or a Purchasing Entity before the expiration
of the period of earned severance as indicated on Exhibit F,
Purchaser shall pay such individual the amount of such earned severance,, less
the period of employment with Purchaser.


 


(ii)                                  In the event that the restructure of Lamb
U.K. (the “Lamb U.K. Restructure Plan”)
shall not have been completed by the Selling Entities prior to the Transfer
Date, UNOVA shall loan Purchaser and/or the relevant Purchasing Entity the
amount of cash allocated in the Lamb U.K. Restructure Plan for the severance of
any Continuing Employee who is identified as part of the Lamb U.K. Restructure
Plan.  Purchaser shall deliver to UNOVA a
note in the amount of £778,000 (the “Lamb U.K. Restructure Note”).  The Lamb U.K. Restructure Note shall bear
interest at the rate of annual LIBOR + 2% and shall be payable on the one year
anniversary of the Transfer Date.  The
Lamb U.K. Restructure Note shall be unsecured. 
Except as provided otherwise in this Section 8.4(e)(ii) or as
consented to in writing by UNOVA, which consent will not be unreasonably
withheld, the Lamb U.K. Restructure Note and credit documents relating to the
Lamb U.K. Restructure Note will reflect terms and conditions and subordination
provisions substantially similar to those between the Purchasing Entities and
their senior lender as contemplated by the term sheet attached to this
Agreement as Exhibit A.


 


(f)                                    Certain
Agreements Regarding Personnel in Spain and France


 


The Purchasing Entities
acknowledge that the Selling Entities utilize the personnel listed on Schedule 8.4(f) (“Certain Personnel”)
in connection with the Business in Spain and France.  The Purchaser covenants and agrees that as
soon as practicable, and in no event more than three months following the
Transfer Date, Purchaser will in each of Spain


 


64





















 


and France (i) form an entity, or (ii) enter
into a contract with a third party, in each case for the purpose of (A) offering
employment to the Certain Personnel located in such country, and (B) discharging
the obligations of the Purchasing Entities under Sections 8.4(a) through
8.4(e) of this Agreement with respect to the Selling Entities and the
Certain Personnel who become Continuing Employees.  Purchaser agrees that, except as otherwise
set forth in this Agreement, Purchaser shall indemnify the Selling Entities for
any Loss incurred by the Selling Entities or their Affiliates in connection
with the employment or termination of the Certain Personnel after the Transfer
Date.


 


8.5                               Agreements
Regarding Intellectual Property


 


(a)                                  Use of UNOVA Name
and Mark


 


Notwithstanding
the provisions of Section 1.2(i), from and after the Transfer Date,
Purchaser and the Purchasing Entities shall be permitted to use, in the
operation of the Business, (i) the existing inventories of raw materials,
work-in-process and finished goods that bear the names “UNOVA” or “UNOVA
Industrial Automation Systems, Inc.” or any variation thereof or any
trademark relating thereto, or any acronym or abbreviation thereof
(collectively, the “Seller Names”) for a
reasonable period to exhaust such inventories, but in no event longer than six
months following the Transfer Date, and (ii) existing stationery,
packaging, shipping, invoices, purchase orders and similar supplies which bear
any of the Seller Names for the period necessary to exhaust such supplies, but
in no event longer than three months following the Transfer Date; provided, however, that in each case,
Purchaser and the Purchasing Entities shall use reasonable efforts (to the
extent commercially feasible) to overprint, overstamp, apply an appropriate
label or otherwise obliterate the Seller Names on such items or shall otherwise
indicate that the Business has been sold to Purchaser and the Purchasing
Entities and is independent of any of the Selling Entities.  Purchaser and the Purchasing Entities shall
not use or permit any of the Cincinnati Lamb Group to use the name “Cincinnati
Milacron”, or any confusingly similar name or mark, or any trademarks
(including applications and registrations therefor) relating thereto, or any
acronym or abbreviation thereof.


 


(b)                                  Industrial
Automation Systems


 


Effective
as of the Transfer Date, the Selling Entities hereby grant to the Purchasing
Entities a non-exclusive, worldwide, royalty free, perpetual right and license
to use the name “Industrial Automation Systems” in connection with the
Business; provided however that the Selling
Entities shall continue to have the right and license to use the name
Industrial Automation Systems in connection with the conduct of their
operations after the Transfer Date, and further provided that the Selling
Entities make no claim or representation to a prior exclusive right to use the
name Industrial Automation Systems, it being understood that the name
Industrial Automation Systems is in common usage by other third parties.  The right and license to the Purchasing
Entities granted herein shall not include the right and license to use the name
Industrial Automation Systems in combination with the name UNOVA or any
business names in use by UNOVA in the United States or in any foreign countries
(other than


 


65





















 


in connection with the Business), or any names
confusingly similar thereto, except as described in Section 6.5(a) hereto.


 


(c)                                  Certain
Licensed Intellectual Property


 


Except
as otherwise provided in this Agreement, to the extent that Licensed
Intellectual Property exists as of the Transfer Date that is used by the
Cincinnati Lamb Group in the conduct of the Business, on the one hand, and is
used by the remaining operations of UIASI or UNOVA UK in the conduct of their
operations other than in the Business, on the other hand, the parties agree as
follows:


 


(i)                                    Purchaser’s
License of Licensed Intellectual Property


 


Effective
as of the Transfer Date, the Purchasing Entities hereby grant to the Selling
Entities, for the Selling Entities’ benefit, a non-exclusive, worldwide,
royalty free, perpetual right and license to utilize any Licensed Intellectual
Property, to continue to use such Licensed Intellectual Property other than in
the Business.


 


(ii)                                Seller’s
License of Licensed Intellectual Property.


 


Effective as of the Transfer Date, the Selling
Entities hereby grant to the Purchasing Entities, for the Purchasing Entities’
benefit, a non-exclusive, worldwide, royalty free, perpetual right and license
to utilize any Licensed Intellectual Property, to continue to use such
intellectual property in the Business.


 


(d)                                  License
Transfer


 


The
Selling Entities, at their sole cost and expense, shall pay any costs or fees
necessary for obtaining the transfer of software licenses relating primarily or
exclusively to the Business.


 


8.6                               Exclusivity


 


Until
the earlier of the Closing or termination of this Agreement, the Selling
Entities shall not, and shall not permit or authorize any of their officers,
directors, agents or representatives to, directly or indirectly, solicit or
encourage any “Acquisition Proposals” (as
defined below) or participate in any discussions or negotiations relating to an
Acquisition Proposal relating, directly or indirectly, to the Cincinnati Lamb
Group.  Until the earlier of the Closing
or termination of this Agreement, UNOVA shall promptly notify Purchaser in
writing of any such Acquisition Proposal or any communication or indication
from any person that it or any other person is considering making such an
Acquisition Proposal, whether oral or written. 
The term “Acquisition Proposal” shall
mean any proposal for any business combination involving the Cincinnati Lamb
Group or the acquisition, directly or indirectly, of all or a portion of the
Purchased Assets or the Shares.


 


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8.7                               Taxes


 


(a)                                  Taxes Relating
to the Business and the Transferred Subsidiaries


 


(i)                                     Subject to the provisions of Section 8.7(e),
after the Transfer Date, the Selling Entities shall pay all Taxes with respect
to the ownership, use or operation of the Purchased Assets on or prior to the
Transfer Date and the Purchaser or its Affiliates shall pay all such Taxes with
respect to the ownership, use or operation of the Purchased Assets after the
Transfer Date.  Any and all real property Taxes, personal property Taxes, assessments,
utilities, lease rentals, fuel and other charges applicable to the Purchased
Assets that are payable in the year that includes the Transfer Date shall be
pro-rated to the Transfer Date based on the percentage of the year prior to the
Transfer Date, and such Taxes and other pro-rated amounts shall be allocated
between the Parties by adjustment to the Purchase Price at the Closing.


 


(ii)                                  The Selling Entities shall be responsible for
and shall indemnify the Purchaser or its Affiliate for any Tax liability of the
Selling Entities (or any predecessors thereof) arising pursuant to Treasury
Regulations Section 1.1502-6 (or any comparable provision of state,
local or non-U.S. law).


 


(b)                                  Tax Returns


 


(i)                                    Consolidated
Returns


 


Mainco
and the Purchaser shall cause each of the Transferred Subsidiaries to consent
to join, for all taxable periods ending on or before the Transfer Date for
which it is eligible to do so, in all consolidated, combined, or unitary Tax
Returns of or including the applicable Selling Entity or any member of its
Affiliated Group that UNOVA requests it to join.  The Selling Entity shall prepare and file (or
cause to be prepared and filed) all such consolidated, combined, or unitary Tax
Returns which relate to the Transferred Subsidiaries, and shall pay (or cause
to be paid) all Taxes to which such Tax Returns relate for all periods covered
by such Tax Returns, except to the extent such Taxes are reflected on the
Closing Balance Sheet (in which case Mainco or the Purchaser, as the case may
be, shall promptly pay to the Selling Entity on demand an amount equal to such
Taxes).  Such Tax Returns (and the
taxable year that begins the day after the Transfer Date) shall be prepared in
accordance with Treasury Regulations Section 1.1502-76 (or
comparable provisions of state, provincial, local or foreign Tax Laws);
provided however that no election under Treasury Regulations Section 1.1502-76(b)(2)(ii) (or
comparable provisions of state, provincial, local or foreign Tax Laws) shall be
made.


 


(ii)                                Separate
Returns


 


Mainco
and the Purchaser shall prepare (or cause to be prepared), execute, and timely
file all Tax Returns of each of the applicable Transferred Subsidiaries (other
than consolidated, combined, or unitary Tax Returns) for all periods ending on
or prior to the Transfer Date and all periods that begin before the Transfer Date
and end after the Transfer


 


67





















 


Date that are required to be filed after the Transfer Date, and shall
pay (or cause to be paid) all Taxes to which such Tax Returns relate for all
periods covered by such Tax Returns.  All
such Tax Returns shall be prepared in accordance with the past practice of the
applicable Transferred Subsidiary, unless otherwise required by applicable Tax
Law.  Mainco and the Purchaser shall
permit UNOVA (on behalf of the applicable Selling Entity) to review and comment
on each such Tax Return no later than thirty (30) days prior to the filing
of such return and shall not file any such return without UNOVA’s written
consent, which consent shall not be unreasonably withheld.


 


(c)                                  Tax Contests


 


With
respect to any audit, court proceeding or other dispute with respect to any Tax
matter (“Tax Contest”) that arises in
a consolidated, combined or unitary Tax Return for a period ending on or before
the Transfer Date that affects either of the Transferred Subsidiaries, any of
the Selling Entities or any member of any Affiliated Group thereof, the common
parent of the Affiliated Group shall have the right to represent the interests
of the Transferred Subsidiary, the Selling Entity and other member of any
Affiliated Group thereof, to employ counsel of its choice at its expense and to
control the conduct of such Tax Contest, including settlement or other
disposition thereof.  Mainco and the
Purchaser shall have the right to control the conduct of any Tax Contest
relating to either of the Transferred Subsidiaries with respect to any Tax
matter arising in a period ending after the Transfer Date; provided, however,
that UNOVA (on behalf of the applicable Selling Entity) shall have the right to
fully participate in that portion of any Tax Contest relating to Taxes for
which the Selling Entity may be responsible.


 


(d)                                  Cooperation


 


The
Selling Entities, on the one hand, and the Purchasing Entities and the
Cincinnati Lamb Group, on the other, shall cooperate (and cause their
affiliates to cooperate) with each other and with each other’s agents,
including accounting firms and legal counsel, in connection with Tax matters
relating to the Cincinnati Lamb Group, including (i) preparation and
filing of Tax Returns, (ii) determining the liability and amount of any
Taxes due or the right to and amount of any refund of Taxes, (iii) examinations
of Tax Returns, and (iv) any Tax Contests. 
Such cooperation shall include each Party making all information and
documents in its possession relating to the relevant member of the Cincinnati
Lamb Group available to the other Party. 
The Parties shall retain all Tax Returns, schedules and work papers, and
all material records and other documents relating thereto, until the expiration
of the applicable statute of limitations (including, to the extent notified by
any Party, any extension thereof) of the Tax period to which such Tax Returns
and other documents and information relate. 
Each of the Parties shall also make available to the other Party, as
reasonably requested and available, personnel (including officers, directors,
employees and agents) responsible for preparing, maintaining, and interpreting
information and documents relevant to Taxes, and personnel reasonably required
as witnesses or for purposes of providing information or documents in
connection with any Tax Contests; provided,
however, that the requesting Party shall reimburse the other Party
on a time and materials


 


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basis for any such cooperation.  Any information or documents provided under
this paragraph shall be kept confidential by the Party receiving such
information or documents, except as may otherwise be necessary in connection
with the filing of Tax Returns or in connection with any Tax Contests.  Each of the Parties shall, upon request, use
their reasonable efforts to obtain, at the expense of the requesting Party, any
certificate or other document from any Tax authority or any other person as may
be necessary to mitigate, reduce or eliminate any Tax that could be imposed
(including without limitation with respect to the transactions contemplated
hereby).  Without limiting the generality
of the foregoing, Purchaser shall timely deliver to UNOVA (as agent for the Selling
Entities) any requested resale, exemption or similar certificate and shall give
all notices as necessary to comply with the occasional sale/casual sale
exemptions from sales Tax.


 


(e)                                  Transfer Taxes


 


The
Selling Entities, on the one hand, and the Purchasing Entities, on the other
hand, shall each be responsible for one-half of all real estate, transfer,
sales, use, excise, stamp, registration and other such Taxes and fees
(including any penalties and interest) incurred in connection with the
Transactions, and shall, at their own expense, file all necessary Tax Returns
and other documentation with respect thereto. 
The Parties shall cooperate with each other to minimize any such Taxes.


 


(f)                                    Employment
Taxes


 


Purchaser,
on behalf of the Purchasing Entities, shall prepare and furnish to each of the
Continuing Employees following the Closing a Form W-2 that shall
reflect all wages and compensation paid to such employee for the entire
calendar year in which the Transfer Date occurs, and shall file with the Social
Security Administration Forms W-2 (Copy A) with respect to such
employees.  Each such Selling Entity
shall furnish to Purchaser the Forms W-4 and W-5, as
applicable, of each such employee.  It is
the intent of the Parties hereunder that the obligations of Purchaser and the
Selling Entities under this Section 8.7(f) shall be carried out in
accordance with Section 5 of Revenue Procedure 2004-53.


 


(g)                                 Section 338(h)(10) Elections.


 


(i)                                     At the option of UNOVA, Mainco shall join
with UNOVA and UIASI in making an election under Section 338(h)(10) of
the Code and any corresponding or similar provisions of state or local Law (the
“Section 338(h)(10) Elections”)
with respect to the purchase and sale of the R&B Shares hereunder.


 


(ii)                                  Mainco shall assist UNOVA and UIASI in the
preparation of Form 8023 and any accompanying schedules required under Section 338(h)(10) of
the Code and any corresponding or similar provisions of foreign, state, provincial
or local Law.  Mainco shall execute Form 8023
and any accompanying schedules and such other documents or forms (the “Section 338 Forms”) at the
Closing or at such other time as UNOVA may request or as required by the Code
in order to effectuate the Section 338(h)(10) Elections.  Except as required pursuant to applicable Law
or a determination (as defined in Section 1313


 


69





















 


of the Code or any similar provision of Law), Mainco and UNOVA shall
file all Tax Returns in a manner consistent with the Section 338(h)(10) Elections,
Form 8023 and any accompanying schedules and such other documents and
forms as are requested by UNOVA to effectuate the Section 338(h)(10) Elections.


 


(h)                                 Section 338(g) Election


 


Upon
the request by Mainco, UNOVA shall take (and shall cause its subsidiaries to
take) all actions necessary and appropriate (including timely filing such
forms, Tax Returns, elections, schedules and other documents as may be
required), to effect and preserve a timely Section 338(g) election in
accordance with the requirements of Section 338 of the Code (and any corresponding
elections under state, local or foreign Law) with respect to the Purchaser’s or
its Affiliates acquisition of the CM Korea Shares.  The parties shall report the sale of the CM
Korea Shares pursuant to this Agreement consistently with the Section 338(g) election
and shall take no position contrary thereto or inconsistent therewith in any
Tax Return, any discussion with or proceeding before any taxing authority, or
otherwise.


 


(i)                                    Interpretation


 


The
provisions of this Section 8.7 shall control over any conflicting
provisions of Article 11.


 


(j)                                    Tax Treatment


 


(i)                                     It is the intent of the Parties that the
Transactions shall be treated, in their entirety, as a fully taxable sale or
exchange of the Purchased Assets and qualified stock purchases (within the
meaning of Section 338 of the Code) with respect to the Shares, and each
of the Parties shall not take any position on any Tax Return inconsistent with
such intent.  From and after the date of
this Agreement, each of the Parties shall use all commercially reasonable
efforts to cause the Transactions to be treated, and shall not knowingly take
any actions or cause any actions to be taken that could prevent the
Transactions from being treated, as a fully taxable sale or exchange.


 


(ii)                                  Any indemnification payments made pursuant to
this Agreement shall be treated by the Parties, to the extent permitted by
applicable Law, as a purchase price adjustment, unless determined otherwise in
a final determination as defined in Section 1313 of the Code.


 


8.8                               Settlement
of Intercompany Accounts


 


On
the Transfer Date, the Selling Entities shall cause all intercompany payables
and receivables (other than trade payables or receivables) to be settled.


 


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8.9                               Cash
of the Transferred Subsidiaries


 


UNOVA
shall use reasonable efforts to reduce any cash balance of either of the
Transferred Subsidiaries prior to the Transfer Date.  To the extent that either of the Transferred
Subsidiaries has a cash balance as of the Transfer Date, within ten days
following the Transfer Date, Purchaser shall cause such Transferred Subsidiary
to pay such cash balance to UNOVA.


 


8.10                        Performance
Bonds


 


To the extent that Purchaser or another Purchasing
Entity shall not have substituted its credit and/or the credit of the
Cincinnati Lamb Group under any of the Performance Bonds to the extent provided
in Section 7.8, the Purchasing Entities shall effect such substitution and
to have the Selling Entities released from liability under such Performance
Bonds within one year following the Transfer Date.  Pending such substitution, Purchaser shall
reimburse the Selling Entities for all costs incurred by Selling Entities in
maintaining the Performance Bonds and shall pay such amounts promptly upon
receipt of an invoice therefor.  In the
event that the customer under any executory contract secured by any of the
Performance Bonds shall draw on the Performance Bonds for any reason, the
applicable Selling Entities shall be entitled to immediate reimbursement from
Purchaser for the amount so drawn plus all associated costs incurred by the
Selling Entities.  The Selling Entities
shall be entitled to draw on the Backup L/Cs in connection with such
reimbursement, and if the Backup L/Cs are insufficient to reimburse the Selling
Entities, Purchaser shall immediately pay to the Selling Entities the amount of
any such shortfall in cash.


 


8.11                        Name


 


(a)                                  On or as soon as practicable after the
Transfer Date, Honsberg will change its corporate name to a name that is
dissimilar to its existing corporate name and each of CMUK, Cincinnati Machine
U.K. Holdings Limited and Cincinnati Machine Holdings U.K. Limited will change
its name to a name that does not include “Cincinnati Machine.”  UIASI and UNOVA UK, in their capacity as
shareholders of Honsberg, agree to pass the necessary shareholder’s resolutions
on or as soon as practicable after the Transfer Date and to ensure that
Honsberg will file the change of name with the commercial register immediately
thereafter.  From and after the Transfer
Date, each of Honsberg, CMUK, Cincinnati Machine U.K. Holdings Limited and
Cincinnati Machine Holdings U.K. Limited will not use any name similar to or
likely to be confused with its existing name.


 


(b)                                 On or as soon as practicable after the Transfer
Date, Purchaser will change the corporate name of UII to a name that does not
include “UNOVA.”  From and after the
Transfer Date, Purchaser and the Purchasing Entities will not use any name
similar to or likely to be confused with “UNOVA.”


 


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8.12                        Notice
to Director of Investments


 


No later than thirty (30) days from the Transfer
Date, Purchaser and/or another Purchasing Entity shall file a notification of
its investment contemplated by this Agreement with the Director of Investments
in satisfaction of the Investment Canada Act (Canada).


 


8.13                        Trade
Name Registrations


 


                                                On or as soon as
practicable after the Transfer Date, the Selling Entities shall execute the
assignment documents prepared by the Purchasing Entities reasonably necessary
to transfer and assign all trade name registrations for the trade names which
form part of the Purchased Asset and the relevant Governmental Body.  The Parties hereto agree to cooperate fully
for an orderly transfer of such registrations.


 


8.14                        Authorization;
Mail


 


The
Selling Entities agree that they will promptly transfer and deliver to the
Purchaser any cash or other property that the Selling Entities may receive in
respect of any receivables or other items which shall be transferred to
Purchaser or another Purchasing Entity as provided herein.  The Selling Entities authorize and empower
the Purchaser and the other Purchasing Entities from and after the Transfer
Date (a) to receive and open mail addressed to them and (b) to deal
with the contents thereof in any manner the Purchaser or the applicable
Purchasing Entity sees fit, provided such mail and the contents thereof relate
to the Purchased Assets or otherwise to their Business or to any of the Assumed
Liabilities.  The Selling Entities agree
to deliver to the Purchaser promptly upon receipt and identification any mail,
checks or other documents received by it pertaining to the Purchased Assets or
otherwise to the Selling Entities or any of the Assumed Liabilities.


 


8.15                        Post-Closing
Cooperation


 


To the extent not already provided for under this
Agreement, each of the parties shall cooperate fully, as and to the extent
reasonably requested by the other parties, in providing information that may be
required by such parties in connection with their respective audit, securities compliance
and reporting and similar post-Closing activities related to the transactions
contemplated by this Agreement.


 


8.16                        Cooperation
Regarding U.K. Properties


 


(a)                                  Definitions


 


For the purposes of this Section 8.16, the
following definitions shall apply:


 


(i)                                     “Actual Completion Date”
means
in relation to each of the U.K. Properties the date on which that Property is
transferred, conveyed or assigned to the Purchasing Entity.


 


(ii)                                  “Assurances”
means
the transfers, conveyances or assignments of the U.K. Properties and “Assurance”
shall mean any one of them


 


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(iii)                               “Freehold Property”
means
the U.K. Properties as designated on Schedule 8.16.


 


(iv)                              “Landlord’s Consent”
means
any reversioner’s consent to an assignment required under the terms of any
lease relating to that Leasehold Property.


 


(v)                                 “Leasehold Properties”
means
the leasehold properties occupied by the Selling Entities for the purposes of
the U.K. portion of the Business which are described in Schedule 8.16 and “Leasehold
Property” means any one of them


 


(vi)                              “Registered Properties”
means
the U.K. Properties as designated on Schedule 8.16;


 


(vii)                           “Relevant Properties”
means
those Leasehold Properties which require Landlord’s Consent to assign the
relevant property lease and “Relevant Property” shall mean any one of them.


 


(viii)                        “U.K. Properties”
means
those freehold and leasehold premises occupied by the relevant Selling Entities
for the purposes of the UK portion of the Business which are set out at Schedule 8.16, which schedule shall be agreed and attached
to this Agreement within two business days of the date hereof.


 


(b)                                  Matters
Affecting the U.K. Properties


 


The U.K. Properties are sold subject to and with
the benefit of:


 


(i)                                     In the
case of the Registered Properties, the exceptions, reservations and covenants
(except charges to secure the repayment of money) contained or referred to in
the charges registers of their respective title numbers;


 


(ii)                                  In the
case of the Leasehold Properties, the covenants and conditions on the part of
the tenant contained in the leases under which the relevant property is held;


 


(iii)                               All local land charges; and


 


(iv)                              All notices served and orders,
demands, proposals or requirements made, by any local or other public
authorities.


 


(c)                                  Landlord’s
Consents


 


(i)                                     The sale
of the Relevant Properties is subject to the relevant Selling Entity which
occupies the relevant Leasehold Property obtaining Landlord’s Consent in
respect of that property.


 


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(ii)                                  The
relevant Selling Entity shall as soon as reasonably practicable and at its own
cost apply for and use all reasonable endeavours to obtain Landlord’s Consent
as soon as possible.


 


(iii)                               The
Purchasing Entity shall use all reasonable efforts to assist the relevant
Selling Entity in obtaining Landlord’s Consent and in particular shall promptly
provide all such information and references as the relevant Selling Entity may
reasonably require in relation to the obtaining of Landlord’s Consent and such
other information as the landlord may be entitled to request under the terms of
the relevant property lease.


 


(iv)                              The
Purchasing Entity will enter into such covenants as may be reasonably required
by the landlord of the Relevant Property and provide such additional security
for the performance by the Purchasing Entity of the tenant’s covenants (whether
by way of guarantee, rent deposit or bank guarantee) as the landlord may
reasonably require.


 


(v)                                 The
Purchasing Entity shall on and from the Transfer Date be permitted to enter
into occupation of the Relevant Property as licensee of the relevant Selling
Entity subject to the following provisions:


 


(A)                              The Purchasing Entity shall be
entitled to receive all profit and other income from the Relevant Property;


 


(B)                                The
Purchasing Entity shall pay or indemnify the relevant Selling Entity against
all outgoings and expenses attributable to the Purchasing Entity’s period of
occupation;


 


(C)                                The
Purchasing Entity shall observe and perform all the covenants and conditions
(excluding any alienation covenants) contained or referred to in the property
lease relating to the Relevant Property (save that in respect of any covenants
relating to the repair of the Relevant Property the Purchasing Entity’s
liability shall be limited to keeping the Relevant Property in as good repair
as when the Purchasing Entity went into occupation (fair wear and tear
excepted)) and indemnify the relevant Selling Entity for any costs or
liabilities as a result of any breach or non-observance or non-performance of
such covenants and conditions;


 


(D)                               The
relevant Selling Entity so far as it is lawfully able to do so shall permit the
Purchasing Entity to remain in occupation of the Relevant Property; and


 


(E)                                 The
Purchasing Entity shall not carry out any activity for which the consent of any
third party may be required without such consent being obtained or carry out
any such activity which would constitute a breach or non-observance of the
covenants and conditions in the relevant property lease.


 


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(d)                                  Completion


 


(i)                                     If the Landlord’s
Consent is refused or has not been obtained within two months of the Transfer
Date then both parties consider that the relevant landlord is acting
unreasonably in refusing or withholding consent the relevant Selling Entity
shall at the request of the Purchasing Entity and at the joint expense of the
relevant Selling Entity and Purchasing Entity seek the opinion of a leading
Counsel specialising in landlord and tenant law on whether the landlord is
unreasonably withholding or has unreasonably refused consent to the assignment.


 


(ii)                                  If such
leading Counsel advises that the landlord is unreasonably withholding or has
unreasonably refused consent the relevant Selling Entity shall at the joint
expense of both parties apply to a court of competent jurisdiction for a
declaration that the landlord is acting unreasonably.


 


(iii)                               If the
declaration is obtained the assignment of the Relevant Property shall be
completed five business days thereafter.


 


(iv)                              If the
declaration referred to in Section 8.16(c)(vi)(C) is refused or such leading
Counsel advises that consent to assign will be refused or withheld the relevant
Selling Entity shall as soon as reasonably practicable apply to the relevant
landlord(s) for all necessary consents to the grant of an underlease of the
Relevant Property to the Purchasing Entity for a term equal to the residue of
the term of the relevant property lease less three days at a rent equal to and
otherwise on the same terms as the said lease and the provisions of
Sections 8.16(c)(iii) and 8.16(c)(iv) shall apply to the obtaining of such
consent and if such consent is obtained the Selling Entity shall grant and the
Purchasing Entity shall accept such underlease on the date five business days
after the date of receipt of such consent.


 


(e)                                  Completion


 


(i)                                     Notwithstanding
Sections 1.1, 1.2 and 2.1 of this Agreement, completion of the sale of the U.K.
Properties shall take place:


 


(A)                              In the case of the Freehold
Properties, those Leasehold Properties in respect of which Landlord’s Consent
has been obtained and those Relevant Properties where Landlord’s Consent is not
required, on the Transfer Date; and


 


(B)                                In the
case of the remaining Relevant Properties in respect of which Landlord’s
Consent is necessary but has not been obtained, by the date five business days
after Landlord’s Consent has been obtained.


 


(ii)                                  On the
Actual Completion Date the Purchasing Entity shall deliver to the relevant
Selling Entity a duly executed Assurance in respect of each of the U.K.
Properties.


 


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(f)                                    Assurances


 


The Assurances will contain (where
applicable):


 


(i)                                     A
covenant by the Purchasing Entity with the relevant Selling Entity that the
Purchasing Entity and its successors in title will observe and perform:


 


(A)                              The
exceptions, reservations and covenants contained or referred to in the case of
each of the Registered Properties, the entries (except those relating to
charges to secure the repayment of money) appearing in the charges registers of
their respective title numbers;


 


(B)                                In the
case of the Leasehold Properties, the covenants and conditions on the part of
the tenant contained in the relevant property leases;


 


and will
indemnify and keep indemnified the relevant Selling Entity against all actions,
claims, demands and proceedings taken or made against the relevant Selling
Entity and all costs, damages, expenses, liabilities and losses incurred by the
relevant Selling Entity as a result of the breach, non-performance or
non-observance of the same; and


 


(ii)                                  (In the
case of the Leasehold Properties) an agreement and declaration to the effect
that the Selling Entity shall not be liable under any of the covenants set out
in Sections 3 or 4 of the Law of Property (Miscellaneous Provisions) Act 1994
for the consequences of any breach of the terms of the property leases relating
to their state and condition.


 


8.17                        Mexico VAT
Deposit


 


The parties acknowledge that the Selling Entities
expect to receive a refund of a deposit relating to value added taxes in Mexico
(the “Mexico VAT Deposit”).  Each of the Purchasing Entities covenants and
agrees to cooperate fully, as and to the extent reasonably requested by the Selling
Entities and at the sole cost and expense of the Selling Entities, in obtaining
the refund of the Mexico VAT Deposit, including but not limited to assisting
the Selling Entities in submitting any necessary claims for the Mexico VAT
Deposit and paying over to UNOVA any portion of the Mexico VAT Deposit received
by such Purchasing Entity.


 


 


(Article 9 follows)


 


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ARTICLE 9.

Noncompetition Agreement


 


9.1                               Noncompetition
Agreement


 


For
and in consideration of the benefits to be derived, directly and indirectly,
from this Agreement, each of the Selling Entities covenants and agrees that for
a period of five years (three years in Europe) following the Transfer Date, it
shall not (and shall not permit any of its Affiliates to), own, manage,
operate, join, control or participate in the ownership, management, operation or
control of, or be connected (as director, officer, employee, consultant, agent,
independent contractor, or otherwise) in any other manner with any business
activity constituting “Competitive Business”
(as defined in Section 9.3) or any business substantially similar thereto
in those places and locales where the Cincinnati Lamb Group has conducted and
actively engaged in the Business on or prior to the Transfer Date.


 


9.2                               Limitations
on Noncompetition Agreement


 


(a)                                  Notwithstanding anything in Section 9.1 to
the contrary, the Selling Entities and their affiliates shall not be prohibited
from (i) the continued conduct and operation of the Landis Grinding
Systems operations of UIASI and UNOVA UK, (ii) any investment in Purchaser
or its affiliates, (iii) the acquisition or investment in any corporation,
company, partnership or other business entity (a “Company”)
partially engaged in the Competitive Business provided that such activity does
not exceed ten percent (10%) of the net revenues or net assets of such Company,
(iv) the ownership of not more than ten percent (10%), in the aggregate,
of any class of debt or equity security of any Company engaged in the
Competitive Business provided that such security is traded on a national
securities exchange or an inter-dealer quotation system, or (v) any
investments made by the investment managers of UNOVA’s pension plans or the
managers of UNOVA’s 401(k) plans or similar non-qualified retirement plans.


 


(b)                                 In the event that any provision of this
Article 9 shall be held invalid, illegal, void, inoperative or
unenforceable in an arbitration pursuant to Section 11.5 by reason of the
geographic or business scope or the duration of such provision, such
invalidity, illegality or unenforceability shall attach only to the scope or
duration of such provision and shall not affect or render invalid, illegal,
void, inoperative or unenforceable any other provision of this Agreement, and,
to the fullest extent permitted by Law, this Agreement shall be construed as if
the geographic or business scope or the duration of such provision had been
more narrowly drafted so as not to be invalid, illegal, void, inoperative or
unenforceable.


 


9.3                               Definition
of Competitive Business


 


As
used in this Agreement, the term “the Competitive Business”
means the design, manufacture, sale and service of value-added manufacturing
products and services for aerospace, equipment and general job shop markets, as
conducted by the Cincinnati Lamb Group on the Transfer Date.


 


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9.4                               Nonsolicitaiton


 


For a period of two years following the Transfer
Date, the Selling Entities shall not (and shall not permit any of their
Affiliates to), directly or indirectly, without the prior written consent of
Purchaser, (a) solicit, offer to hire, entice away or hire any Continuing
Employee as an employee, independent contractor or otherwise, or (b) divert or
attempt to divert from Purchaser any business whatsoever included in the
Business as conducted by the Cincinnati Lamb Group as of the Transfer Date by
influencing or attempting to influence any current or former customer or
supplier of the Business as of the Transfer Date.  The foregoing restrictions shall not prohibit
general employment solicitations to the public or hiring of any Continuing
Employee who contacts any of the Selling Entities in response to such general
solicitation.


 


9.5                               Injunctive
and Equitable Relief


 


The
Selling Entities agree that the remedy of damages for any breach of
Article 9 may be inadequate and that in the event of any such breach or
threatened breach by UNOVA or its Affiliates, Purchaser or the applicable
Purchasing Entity shall be entitled to injunctive relief in addition to any
other remedy, at Law, in equity or under this Agreement to which it may be
entitled.


 


(Article 10 follows)


 


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ARTICLE 10.

Termination


 


10.1                        Termination


 


This
Agreement may be terminated immediately upon the receipt of notice of
termination as provided for in Section 10.2, and the transactions provided
for in this Agreement may be abandoned, without liability on the part of the
Party effecting such termination:


 


(a)                                  By mutual written consent of all of the
Parties;


 


(b)                                 By any Party, if (i) any court of
competent jurisdiction or any Governmental Body shall have issued a final
order, decree or ruling or taken any other final action restraining, enjoining
or otherwise prohibiting the consummation of the transactions contemplated
hereby and such order, decree, ruling or other action is or shall have become
final and nonappealable, or (ii)  the Asset Sale and the Stock Sale have
not been consummated on or before April 29, 2005 (the “Deadline
Date”); provided, that (x) no party may terminate this
Agreement pursuant to this clause (b) if such party’s failure to fulfill
any of its obligations under this Agreement shall have been the reason that the
Closing shall not have occurred on or before such date, and (y) if the
Closing shall not have occurred by the Deadline Date by reason of nonsatisfaction
of the conditions set forth in Sections 6.6(i) and (ii) or
Sections 7.5(a) and (b) and all other conditions precedent in
Articles 6 and 7 have been satisfied or are capable of being
satisfied or, to the extent legally permissible, have been waived, the Deadline
Date shall be the date two months after the Deadline Date (the “Extended Deadline Date”);


 


(c)                                  Subject to Section 2.2, by Purchaser, if
any of the conditions of Article 6 of this Agreement have not been
satisfied on or before the Deadline Date and have not been waived by the
Purchasing Entities in writing; provided, however,
that the foregoing termination right shall not exist to the extent that any
Purchasing Entity has breached any of its material obligations hereunder;


 


(d)                                 Subject to Section 2.2, by UNOVA, if any
of the conditions of Article 7 of this Agreement have not been satisfied
on or before the Deadline Date and have not been waived by UNOVA in writing; provided, however, that the foregoing termination right
shall not exist to the extent that one or more of the Selling Entities has
breached any of its material obligations hereunder;


 


(e)                                  By any Purchasing Entity, if any of the
Selling Entities or Transferred Subsidiaries files on or before the Transfer
Date a petition in bankruptcy, reorganization, liquidation or receivership or a
petition in bankruptcy, reorganization or receivership is filed on or before
the Transfer Date against any of the Selling Entities; or


 


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(f)                                    By UNOVA, if a Purchasing Entity files on or
before the Transfer Date a petition in bankruptcy, reorganization, liquidation
or receivership or a petition in bankruptcy, reorganization or receivership is
filed on or before the Transfer Date against a Purchasing Entity.


 


10.2                        Notice
of Termination


 


Any
Party terminating this Agreement in accordance with Section 10.1 shall
give the other Parties prompt written notice of termination, setting forth in
reasonable detail the cause of termination.


 


 


(Article 11 follows)


 


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ARTICLE 11.

Indemnification


 


11.1                        Indemnification
by the Selling Entities


 


In
order to induce the Purchasing Entities to enter into this Agreement and to
consummate the transactions contemplated hereby, each of the Selling Entities
(collectively, the “Indemnifying Selling Entities”)
jointly and severally covenants and agrees to and shall indemnify the
Purchasing Entities and their respective officers, directors and affiliates
(collectively, the “Buying Interests”) and shall
hold the Buying Interests harmless against and with respect to any and all
losses, damages, costs or expenses (including reasonable attorneys’ fees and
costs) (“Losses” or individually a “Loss”) suffered or incurred by the
Buying Interests and resulting from or arising out of the matters described
below in this Section 11.1.


 


(a)                                  Misrepresentation
or Breach of Warranty


 


Any
misrepresentation or breach of any of the representations and warranties of the
Selling Entities set forth in this Agreement or any of the Related Agreements;


 


(b)                                  Breach
of Covenant or Agreement


 


Any
breach or nonfulfillment any of the covenants, agreements or other obligations
of any of the Selling Entities set forth in this Agreement or any of the
Related Agreements;


 


(c)                                  Excluded
Liabilities


 


Any
of the Excluded Liabilities;


 


(d)                                  R&B
Liabilities


 


Any
debt, liability or obligation of R&B (including Taxes) existing on and as
of, or for the period prior to, the Transfer Date (the “R&B
Liabilities”) and any Taxes of CM Korea or UII existing on and
as of, or for the period prior to, the Transfer Date, including in both
instances Taxes arising out of being members of an Affiliated Group;


 


(e)                                  Product
Liability


 


Any
Product Liability of either of the Transferred Subsidiaries arising from the
use or operation of products sold or serviced in the Business, to the extent
such claims arise out of losses or injuries which occur on or prior to the
Transfer Date;


 


(f)                                    Retained
Environmental Liabilities of Transferred Subsidiaries


 


With
respect to any Transferred Subsidiary, any claim by a third party, including a
Governmental Body, that relates to any matter or condition listed on Schedule 3.6(d) that


 


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constitutes, or is demonstrated to have constituted,
a violation of any applicable Environmental Law as in effect on the Transfer
Date, and (ii) any Loss arising from a condition at, on or under the Real
Property, including the presence or release of any Hazardous Substance, to the
extent that such condition is delineated during the Phase I or
Phase II (with respect to this clause (ii), whether or not known on
or before the Transfer Date);


 


(g)                                 Offsite
Disposal


 


Any
debt, liability or obligation arising out of a disposal by any of the Selling
Entities in respect of the Business or any Transferred Subsidiary prior to the
Transfer Date of a Hazardous Substance at any offsite disposal site (“Offsite Disposal”); and


 


(h)                                 Bulk Sales


 


Any
liability or obligation relating to noncompliance with any applicable bulk
sales or transfer Law or the other matters referenced in Section 1.12 including,
without limitation non-compliance with the Retail Sales Tax Act (Ontario) in
connection with the transactions contemplated under this Agreement.


 


11.2                        Indemnification
by Purchasing Entities


 


In
order to induce the Selling Entities to enter into this Agreement and to
consummate the transactions contemplated hereby, the Purchasing Entities (the “Indemnifying Purchasing Entities”)
covenant and agree to and shall jointly and severally indemnify the Selling
Entities and their respective officers, directors and affiliates (collectively,
the “Selling Interests”) and shall
jointly and severally hold the Selling Interests harmless against and with
respect to any and all Losses suffered or incurred by the Selling Interests and
resulting from or arising out of:


 


(a)                                  Misrepresentation
or Breach of Warranty


 


Any
misrepresentation or breach of warranty by a Purchasing Entity of any of its
representations or warranties set forth in this Agreement;


 


(b)                                  Breach
of Covenant or Agreement


 


Any
breach or nonfulfillment by a Purchasing Entity of any of its respective
covenants, agreements or other obligations set forth in this Agreement;


 


(c)                                  Assumed
Liabilities


 


Any
of the Assumed Liabilities;


 


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(d)                                  Operations
After Closing


 


The
operation of the Business by Purchaser and the other Purchasing Entities
following the Transfer Date, except to the extent that a Purchasing Entity is
entitled to indemnification from the Indemnifying Selling Entities pursuant to
Section 11.1;


 


(e)                                  Product
Liability


 


Any
Product Liability to the extent such claims arise out of losses or injuries
which occurred after the Transfer Date;


 


(f)                                    Pension
Liabilities


 


Any
claims in relation to the CMUK Plan, the CMUK Supplementary Plan or the CMUK DC
Plan (including without limitation any claim relating to a contribution notice
issued under section 38 of the Pensions Act 2004, a financial support
direction issued under section 43 of that Act, or a debt arising under
section 75 of the Pension Act 1995) and any claim relating to current employees
of the Lamb U.K. division as of the Transfer Date in respect of any period on
or after the Transfer Date and, in the case of any such employee whose benefits
are transferred from the UNOVA Pension Fund to the CMUK DC  Plan pursuant to Section 5.11, in respect of
any period before, on or after the Transfer Date; and


 


(g)                                 Claims by Continuing Employees


 


Any claims by any Continuing Employee based on
benefits provided or not provided by the Purchasing Entities or Transferred
Subsidiaries following the Transfer Date, including without limitation claims
for severance.


 


(h)                                 Performance Bonds


 


Any
claims against any of the Selling Entities under the Performance Bonds.


 


11.3                        Claims
for Reimbursement


 


In
the event that any of the Buying Interests or the Selling Interests shall have
(i) suffered any Loss, or (ii) received any notice of the
commencement of any action, proceeding or investigation or the making of any
claim or demand by a third party (a “Third Party Claim”),
in each case, in respect of which indemnification may be sought by such party
pursuant to this Article 11, the party who shall have suffered such Loss
or received such notice of such Third Party Claim and who shall seek
indemnification in respect thereof (the “Indemnified Party”)
shall give either UNOVA (if the Indemnified Party is a Buying Interest), or
Mainco or Purchaser (if the Indemnified Party is a Selling Interest), as the
case may be (the “Indemnifying Party”), prompt
written notice of such Loss or Third Party Claim setting forth in reasonable
detail such information as it shall have pertaining thereto and the Indemnified
Party’s demand for indemnification in respect thereof.


 


83





















 


In
the case of Third Party Claims, written notice thereof shall be given to the
Indemnifying Party as promptly as practicable; provided,
however, that the failure of any Indemnified Party to give timely
notice shall not affect rights to indemnification hereunder if (i) such
failure to give timely notice does not materially affect the ability or right
of the Indemnifying Party to participate in the defense of such Third Party
Claim and the Indemnifying Party is not otherwise materially prejudiced
thereby, and (ii) actual notice is given to the Indemnifying Party within
a reasonable time.


 


The
Indemnifying Party shall have 30 days from the date of receipt of said
notice (the “Investigation Period”) to
investigate and dispute the nature, validity or amount of any such claim of
Loss or Third Party Claim.  During the
Investigation Period, the Indemnified Party shall cooperate with the
Indemnifying Party for the purpose of such investigation and, without
limitation, the Indemnified Party shall make available to the Indemnifying
Party the information relied upon by the Indemnified Party to substantiate the
Indemnified Party’s claim and the Indemnifying Party shall have reasonable
access, during normal business hours, to the books, records and other documents
of the Indemnified Party relating to such claim and shall have the right to
take copies at its expense of such relevant books, records and documents for
the purpose of such investigation.  In
the event that the Indemnifying Party shall dispute the nature, validity or
amount of a claim hereunder, the Indemnifying Party shall give the Indemnified
Party written notice of such dispute within the Investigation Period, and the
relevant Parties shall meet promptly thereafter and in good faith attempt to
resolve such dispute.  To the extent that
such Parties cannot resolve any dispute by agreement within 21 days
following such notice of dispute, such dispute shall be resolved pursuant to
Section 11.5.


 


In
the absence of a dispute, the Indemnifying Party shall promptly, and in any
event not later than the expiration of the Investigation Period, reimburse the
Indemnified Party in full (subject to the limitations of Section 8.3 and Section 11.6)
for such Loss, as set forth in the notice. 
In the event that the Indemnifying Party shall dispute only the amount
(and not the validity) of the claim, the Indemnifying Party shall, concurrently
with the delivery of its notice of dispute, pay to the Indemnified Party any
undisputed portion of the claim.


 


11.4                        Defense
and Settlement of Third
Party Claims


 


Except
as otherwise provided in Section 8.3:


 


(a)                                  In the event of a Third Party Claim, the
Indemnifying Party shall have the option to take control of the defense and
investigation of such Third Party Claim, and to employ and engage attorneys of
its own choice to handle and defend the same, at the Indemnifying Party’s sole
cost, risk and expense (the “Direct Litigation Option”).  The Indemnifying Party may elect to exercise
the Direct Litigation Option by giving prior written notice to the Indemnified
Party.  If the Indemnifying Party so
elects, the Indemnified Party shall cooperate in all reasonable respects with
the Indemnifying Party and such attorneys in the investigation, trial and defense
of such Third Party Claim and any appeal arising therefrom and shall permit
access to the personnel of the Indemnified Party and to any


 


84





















 


relevant books, records and documents within the
possession or control of the Indemnified Party in connection with such claim
and to take copies of such relevant materials at the expense of the
Indemnifying Party; provided, however,
that the Indemnified Party may, at its own cost, participate in (but not
control) such investigation, trial and defense of such Third Party Claim and
any appeal arising therefrom.  If the
Indemnifying Party does not elect the Direct Litigation Option, then the
Indemnified Party shall defend against the Third Party Claim in the manner it
deems appropriate.


 


(b)                                  The Indemnified Party (or the Indemnifying
Party if it has exercised the Direct Litigation Option) shall not settle,
adjust or compromise the Third Party Claim except with the prior consent of the
Indemnifying Party (or the Indemnified Party), which consent shall not be
unreasonably withheld.


 


(c)                                  In no event shall a Party make any admission
of liability or enter into any settlement, adjustment or compromise of any
Third Party Claim without the prior written consent of the other Party, if as a
result of such admission, settlement, adjustment or compromise an injunction or
other non-monetary relief would be imposed against the Indemnified Party.


 


11.5                        Resolution
of Disputes


 


In
the event of any dispute between any of the Selling Interests and the Buying
Interests over the nature, validity or amount of any claim for reimbursement
made pursuant to Section 11.3, which dispute is not resolved by agreement
pursuant to Section 11.3, such dispute shall be submitted to arbitration
and finally settled under the expedited procedures of the Commercial Rules of
the American Arbitration Association by a single arbitrator appointed in
accordance with those Rules.  The place
of the arbitration shall be Detroit, Michigan. 
The award and findings of such arbitrator shall be conclusive and
binding upon the Parties, and judgment upon such award may be entered in any
court of competent jurisdiction.  UNOVA
shall bear all costs and expenses of its advisors and one-half of the costs and
expenses of the arbitration, and Purchaser shall bear all costs and expenses of
its advisors and one-half of the costs and expenses of the arbitration.


 


11.6                        Setoff
for Resolved Claims


 


Except as otherwise provided in Section 8.3, to
the extent that the Buying Interests have incurred Losses for a claim and
either (a) an appealable judgment including such Losses has been entered
against the Buying Interests and the applicable appeal period has expired
without any appeal of such judgment, (b) a non-appealable judgment or
final appellate decision including such Losses has been entered against the
Buying Interests, or (c) a final settlement agreement including such Losses has
been executed with the Buying Interests as provided in Section 11.4, then upon
written notice to the Indemnifying Selling Entities, the Purchaser shall have
the right to set off and deduct the amounts of any Losses against the principal
of the Secured Note as provided in Section 11.7(b)(ii).


 


85





















 


11.7                        Limitations
on Indemnification


 


(a)                                  Duration


 


Claims
for indemnification under Section 11.1 or 11.2 must be made prior to the
second anniversary of the Transfer Date, except for claims made pursuant to the
following:


 


(i)                                     Section 11.1 (a) (Misrepresentation or
Breach of Warranty), to the extent it is based on a breach of Section 3.5
(Absence of Liens and Encumbrances), which may be made at any time;
Section 3.6(d) (Environmental Matters), which may be made at any time
prior to the fifth anniversary of the Transfer Date; Section 3.6(e)
(Survey Matters), Section 3.6(f) (Real Estate Liens or Encumbrances) or
3.18 (Taxes), which may be made at any time prior to the expiration of the
applicable statute of limitations;


 


(ii)                                  Section 11.1(b) (Breach of Covenant or
Agreement), which may be made at any time;


 


(iii)                               Section 11.1(c) (Excluded Liabilities),
which may be made at any time (other than claims with respect to Taxes, which
must be made prior to the expiration of the applicable statute of limitations);


 


(iv)                              Section 11.1(e) (Product Liability),
which may be made at any time;


 


(v)                                 Section 11.1(f) (Retained Environmental
Liabilities of Transferred Subsidiaries), which may be made at any time;


 


(vi)                              Section 11.1(g) (Offsite Disposal),
which may be made at any time prior to the third anniversary of the Transfer
Date;


 


(vii)                           Section 11.2(b) (Breach of Covenant or
Agreement), which may be made at any time;


 


(viii)                        Section 11.2(c) (Assumed Liabilities),
which may be made at any time;


 


(ix)                                Section 11.2(e) (Product Liability),
which may be made at any time; and


 


(xi)                                Section 11.2(f) (Pension Liability),
which may be made at any time.


 


Indemnification
pursuant to Section 11.1 or 11.2 shall be payable after the expiration of
the aforesaid periods, so long as the claim was identified and asserted in
reasonable detail prior to such expiration.


 


86





















 


(b)                                  Amount


 


(i)                                    Basket


 


Notwithstanding
anything to the contrary contained in Section 11.1 and except as otherwise
provided in Section 8.3, the Indemnifying Selling Entities shall not be
obligated to pay any claims for indemnification pursuant to Section 11.1
until the aggregate of all Losses exceeds $300,000 (the “Basket”),
after which indemnification shall be paid for all Losses in excess of the
Basket.  Notwithstanding the foregoing
sentence:


 


(A)                              Claims for indemnification for Retained
Environmental Liabilities shall be paid from the first dollar of Loss;


 


(B)                                Claims for indemnification for R&B
Liabilities and Excluded Liabilities shall be paid from the first dollar of
Loss; and


 


(C)                                Claims for indemnification pursuant to
Section 11.1(a) (Misrepresentation or Breach of Warranty), to the extent
they are based on a breach of Section 3.6(d) (Environmental Matters), which
shall be in addition to claims for indemnification for Retained Environmental
Liabilities, shall be paid as follows: 
(1) The first $1,000,000 of such Losses, if any, shall be paid 50% by
the Indemnifying Selling Entities and 50% by the Indemnifying Purchasing
Entities; (2) the second $1,000,000 of such Losses, if any, shall be paid
100% by the Indemnifying Selling Entities; (3) the third $1,000,000 of
such Losses, if any, shall be paid 100% by the Indemnifying Purchasing
Entities; and (4) any Losses in excess of $3,000,000 shall be borne exclusively
by the Indemnifying Selling Entities.


 


(ii)                                Cap


 


Notwithstanding
anything to the contrary contained in this Agreement, the maximum aggregate
amount that the Indemnifying Selling Entities shall be obligated to pay
pursuant to Section 11.1 shall be the amount of the Purchase Price;
provided, however, that this maximum amount shall not apply to Excluded
Liabilities or to Losses arising from the fraud or willful misconduct of the
Selling Entities, and provided further, that the maximum amount to be paid in
cash shall not exceed the amount of cash received by UNOVA in respect of the
Purchase Price.  To the extent that the
Selling Entities would otherwise (but for the preceding sentence) be obligated
to pay indemnification pursuant to Section 11.1 in excess of the cash
theretofore received by the Selling Entities, the amount of such
indemnification in excess of the cash received by the Selling Entities shall
reduce the balance of the Secured Note.


 


(c)                                  Other
Limitations


 


Notwithstanding
the foregoing, none of the Indemnifying Selling Entities shall have any
liability for the following:


 


87





















 


(i)                                     Breach of any representations and warranties
contained in this Agreement to the extent that Mainco or Purchaser had notice
in writing of such breach prior to the Transfer Date and did not so notify
UNOVA pursuant to Section 2.2;


 


(ii)                                  For accounts receivable collectibility,
inventory obsolescence or amounts of contract reserves following the final
determination of the Closing Balance Sheet;


 


(iii)                               Any matter subject to indemnification
pursuant to Section 11.1, to the extent such liability would not have
arisen but for a change in legislation or accounting policies made after the
Transfer Date or a change in the interpretation of a Law as determined by any
court of competent jurisdiction or pursuant to an administrative rule-making
decision of a governmental authority after the Transfer Date; or


 


(iv)                              Any matter subject to indemnification
pursuant to Section 11.1, to the extent such liability would not have
arisen but for some act, omission, transaction or arrangement carried out at
the written request or with the written approval of Mainco or Purchaser or
their authorized representatives prior to Closing or which was expressly
authorized by this Agreement.


 


(d)                                  Duty to
Mitigate Damages


 


Nothing
in this Article 11 shall limit or restrict the Parties’ general obligation
under the governing Law to mitigate any loss or damage which it may incur as a
result of any matter giving rise to indemnification under this Agreement.


 


(e)                                  No Double
Recovery


 


Any
Party’s payment of an indemnification claim shall to the extent of such payment
satisfy and preclude any further indemnification claim against such Party which
is capable of being made in respect of the same subject matter.


 


 


(Article 12 follows)


 


88





















 


ARTICLE 12.

Miscellaneous Provisions


 


12.1                        Public
Statements and Press Releases


 


No
Party shall make, issue or release any public announcement, press release,
public statement or public acknowledgment of the terms, conditions and status
of, the transactions provided for in this Agreement, without the prior written
consent of the other Parties as to the content and time of release and the media
in which such statement or announcement is to be made; provided, however, that in the case of
announcements, statements, acknowledgments or revelations which any Party, in
the written opinion of such Party’s counsel, is required by Law or regulations,
including those of public stock exchanges on which the securities of such Party
or its affiliates are traded, to make, issue or release (a “Legally Required Statement”), the
making, issuing or releasing of any such Legally Required Statement shall not
constitute a breach of this Agreement if such Party shall have given, to the
extent reasonably possible, three days prior notice to the other Party, and
shall have attempted, to the extent reasonably possible, to clear such
disclosure with the other Party.  Each
Party agrees that it will not unreasonably withhold or delay any such consent
or clearance.


 


12.2                        Costs and
Expenses


 


Each
Party shall be responsible for and bear its respective costs and expenses in
connection with, or arising out of, the negotiation and execution of this
Agreement and consummation of the transactions provided for in this Agreement.


 


12.3                        Amendment
and Modification


 


This
Agreement may be amended, modified, supplemented or terminated only by a
writing executed on behalf of each of the Parties.


 


12.4                        No Assignment


 


Except
(a) as provided by Section 5.13, (b) for assignment by Purchaser to an
affiliate of Purchaser, or (c) to Purchaser’s lender, no Party shall assign, in
whole or in part, this Agreement or its respective rights and obligations
hereunder without the express prior written consent of the other Parties, and
any assignment by operation of Law or otherwise without the consent of the
Parties shall be void.


 


12.5                        Notices


 


All
notices, requests, demands or other communications hereunder must be in writing
and executed by an authorized representative of the Party responsible therefor,
and must be given either by hand or telecopy, telefax or other
telecommunication device capable of creating a written record which
acknowledges receipt, as follows:


 


89





















 


(a)                                  The Selling
Entities


 


If
such notice is directed to any of the Selling Entities, it shall be sent
to:  (i) UNOVA, Inc., 6001 36th
Avenue West, Everett, WA  98203-1264,
Attention:  General Counsel; Fax No.
425.265.2425; or to such other person or place as UNOVA shall have specified to
Mainco and Purchaser in writing by a notice in accordance with this
Section 12.5, with a copy to Perkins Coie LLP, 1201 Third Avenue, Suite
4800, Seattle, Washington 98101, Attention: 
Andrew Bor, Fax No. 206-359-9000.


 


(b)                                  A Purchasing
Entity


 


If
such notice is directed to any Purchasing Entity, it shall be sent to:  (i) MAG Industrial Automation Systems
LLC, c/o Maxcor Inc., 60 E. 42nd Street, New York, New York 10165, Fax
No. (212) 661-1031, Attention:  Mr.
Meidar, and (ii) Mainco, Inc, MAG Industrial Automation Systems LLC, c/o
Maxcor Inc., 60 E. 42nd Street, New York, New York 10165, Fax
No. (212) 661-1031, Attention:  Mr.
Meidar, or to such other person or place as Purchaser shall have specified to
UNOVA in writing by a notice in accordance with this Section 12.5, with a
copy to Stroock & Stroock & Lavan LLP, 180 Maiden Lane, New York, New
York 10038, Attention:  Martin H.
Neidell, Fax No. 212-806-7836.


 


12.6                        Counterparts
and Facsimile


 


This
Agreement may be executed simultaneously in two or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute
but one and the same instrument and any of such counterparts may be delivered
by facsimile transmission.


 


12.7                        Captions


 


The
captions and table of contents contained in this Agreement are provided for
convenience of reference only and shall not be deemed to constitute a part of
this Agreement.


 


12.8                        Schedules
and Exhibits


 


One
complete set of the Schedules and Exhibits has been marked for identification
and delivered to each of the Parties prior to the execution and delivery of
this Agreement.  The Schedules and
Exhibits are an integral part of this Agreement and are incorporated into this
Agreement by this reference.


 


12.9                        Waiver;
Remedies


 


No
single or partial waiver of any breach of any provision of this Agreement shall
be held to be a waiver of any other or subsequent breach, and the failure of a
Party to enforce at any time any provision of this Agreement shall not be
deemed a waiver of any right of any such Party to subsequently enforce such
provision.  All remedies afforded in this
Agreement 


 


90





















 


shall be taken and construed as cumulative, that is,
in addition to every other remedy provided in this Agreement or by Law.


 


12.10                 Governing Law


 


This
Agreement shall be construed, interpreted and enforced in accordance with the
Laws of the State of Delaware, without resort to its conflict of Law rules.


 


12.11                 Severability


 


In
the event that any provision or any portion of any provision of this Agreement
shall be held invalid, illegal or unenforceable under applicable Law, the
remainder of this Agreement shall remain valid and enforceable, unless such
invalidity, illegality or unenforceability substantially diminishes the rights
and obligations, taken as a whole, of any Party.


 


12.12                 Survival
of Representations, Warranties, Covenants and Agreements


 


Subject
to the provisions contained in Section 11.7, the representations and
warranties in Articles 1, 3 and 4 or in any Schedule or Exhibit shall
survive the execution and delivery of this Agreement and consummation of the
transactions provided for in this Agreement until the second anniversary of the
Transfer Date, notwithstanding any investigation heretofore or hereafter made
by or on behalf of the respective Parties; provided, however, that the
representations and warranties contained in Section 3.6(d) (Environmental
Matters) shall survive until the fifth anniversary of the Transfer Date, the
representations and warranties contained in Section 3.6(e) (Survey
Matters), Section 3.6(f) (Real Estate Liens and Encumbrances) and Section 3.18
(Taxes) shall survive until the expiration of the applicable statute of
limitations, and the representations and warranties contained in
Section 3.5 (Absence of Liens and Encumbrances) which may be made at any
time, Section 11.1(b) which may be made at any time, Section 11.1(c) which may
be made at any time (other than claims with respect to Taxes, which must be
made prior to the expiration of the applicable statute of limitations), and
Sections 11.1(e), (f), (g), Sections 11.2(b), (c), (e) or (f), which may
be made at any time.  The covenants and
agreements hereunder that contemplate performance after the Transfer Date shall
survive the execution and delivery of this Agreement and consummation of the
transactions provided for in this Agreement and shall continue until all
obligations with respect thereto shall have been performed or shall have been
terminated in accordance with their terms.


 


91





















 


12.13                 No
Third Party Beneficiaries


 


Except
to the extent otherwise specifically provided in Article 11, nothing in
this Agreement, whether express or implied, is intended to confer any rights or
remedies under or by reason of this Agreement on any persons other than the
Parties and their respective successors and permitted assigns, nor is anything
in this Agreement intended to relieve or discharge the obligation or liability
of any third persons to any Party, nor shall any provision of this Agreement
give any third persons any right of subrogation or action against any Party.


 


12.14                 Construction


 


This
Agreement and the Related Agreements shall be interpreted without regard to any
presumption or rule requiring construction against the Party causing such
agreements to be drafted.


 


12.15                 Entire  Agreement


 


This
Agreement, including the Exhibits and Schedules and the Related Agreements,
constitutes the sole understanding and agreement of the Parties with respect to
the subject matter of this Agreement and supersedes and cancels all prior
understandings and agreements; provided,
however, that the provisions of Sections 9, 10 and 11 of the letter
of intent dated November 4, 2004 between Maxcor and UNOVA shall remain in full
force and effect through Closing, and provided further,
that no double recovery shall be permitted under this Agreement and the letter
of intent dated November 4, 2004.


 


12.16                 Currency


 


                                                Unless otherwise indicated, all dollar
amounts referred to in this Agreement are in United States funds.


 


(Signature pages follow)


 


92





















 


IN
WITNESS WHEREOF, the Parties, intending to be legally bound, have caused this
Agreement to be executed on and as of the date first above written.


 


 


	
  R&B PLASTICS HOLDINGS, INC.

  	
  UNOVA
  U.K. LIMITED

  
	
   

  	
   

  
	
   

  	
   

  
	
  BY:
  

  	
     S
  / GREGORY L. VERESCHAGIN

  	
   

  	
  BY:
  

  	
     S
  / MICHAEL E. KEANE

  	
   

  
	
  NAME:

  	
  GREGORY L. VERESCHAGIN

  	
   

  	
  NAME:

  	
  MICHAEL E. KEANE

  	
   

  
	
  TITLE:

  	
  EXECUTIVE VICE PRESIDENT

  	
   

  	
  TITLE:

  	
  DIRECTOR

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  CINCINNATI
  MACHINE U.K. LIMITED

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  BY:
  

  	
  S
  / MICHAEL E. KEANE

  	
   

  
	
   

  	
  NAME:

  	
  MICHAEL E. KEANE

  	
   

  
	
   

  	
  TITLE:

  	
  DIRECTOR

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  MAG
  INDUSTRIAL AUTOMATION

  SYSTEMS, LLC

  	
  HONSBERG LAMB

  SONDERWERKZEUGMASCHINEN GMBH

  
	
   

  	
   

  
	
  BY:
  

  	
     S
  / GREGORY L. VERESCHAGIN

  	
   

  	
  BY:
  

  	
     S
  / MICHAEL E. KEANE

  
	
  NAME:

  	
  GREGORY L. VERESCHAGIN

  	
   

  	
  NAME:

  	
  MICHAEL E. KEANE

  
	
  TITLE:

  	
  EXECUTIVE VICE PRESIDENT

  	
   

  	
  TITLE:

  	
  AUTHORIZED REPRESENTIVE OF
  SHAREHOLDERS

  
	
   

  	
   

  
	
   

  	
   

  
	
  UNOVA, INC.

  	
  UNOVA
  CANADA, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
  BY:
  

  	
      S
  /MICHAEL E. KEANE

  	
   

  	
  BY:
  

  	
      S
  / MICHAEL E. KEANE

  	
   

  
	
  NAME:

  	
  MICHAEL E. KEANE

  	
   

  	
  NAME:

  	
  MICHAEL E. KEANE

  	
   

  
	
  TITLE:

  	
  SENIOR VICE PRESIDENT
  & CHIEF FINANCIAL OFFICER

  	
   

  	
  TITLE:

  	
  VICE PRESIDENT

  	
   

  
													



 


93





















 


	
  UNOVA
  INDUSTRIAL AUTOMATION

  SYSTEMS, INC.

  	
  UNOVA IP
  CORP.

  	 

	
   

  	
   

  	 

	
  BY:
  

  	
      S
  / MICHAEL E. KEANE

  	
   

  	
  BY:
  

  	
      S
  / MICHAEL E. KEANE

  	
   

  	 

	
  NAME:

  	
  MICHAEL E. KEANE

  	
   

  	
  NAME:

  	
  MICHAEL E. KEANE

  	
   

  
	
  TITLE:

  	
  VICE PRESIDENT

  	
   

  	
  TITLE:

  	
  VICE PRESIDENT

  	
   

  
											



 


94





















 


LIST OF EXHIBITS

TO

PURCHASE AND SALE AGREEMENT


 


	
  Exhibit A: Silver Point Term
  Sheet

  	
   

  
	
  Exhibit B: Certain Assumed
  Liabilities

  	
   

  
	
  Exhibit C-1: Transitional
  Services Agreement

  	
   

  
	
  Exhibit C-2: Transitional
  Services Agreement

  	
   

  
	
  Exhibit D: Plan Deeds

  	
   

  
	
  Exhibit E: Litigation Required
  Employees

  	
   

  
	
  Exhibit F: Severance Terms

  	
   

  



 





















 


LIST OF SCHEDULES

TO

PURCHASE AND SALE AGREEMENT


 


	
  Schedule 1.5(b)(i):

  	
   

  	
  UNOVA Bank Account

  	
   

  	
   

  
	
  Schedule 3.1(f):

  	
   

  	
  Subsidiaries and Other Equity Investments

  	
   

  	
   

  
	
  Schedule 3.1(h):

  	
   

  	
  Capitalization and Shareholders of
  Transferred Subsidiaries

  	
   

  	
   

  
	
  Schedule 3.2(a):

  	
   

  	
  December Financials

  	
   

  	
   

  
	
  Schedule 3.2(b):

  	
   

  	
  Events Subsequent to December Balance Sheet

  	
   

  	
   

  
	
  Schedule 3.2(c):

  	
   

  	
  Indebtedness

  	
   

  	
   

  
	
  Schedule 3.4:

  	
   

  	
  Inventory Valuation Policy

  	
   

  	
   

  
	
  Schedule 3.5:

  	
   

  	
  Absence of Liens and Encumbrances

  	
   

  	
   

  
	
  Schedule 3.6(a):

  	
   

  	
  Owned Real Property

  	
   

  	
   

  
	
  Schedule 3.6(b):

  	
   

  	
  Realty Leases (as Lessee)

  	
   

  	
   

  
	
  Schedule 3.6(d):

  	
   

  	
  Environmental Matters

  	
   

  	
   

  
	
  Schedule 3.8(a):

  	
   

  	
  Sales Orders, Bids and Proposals

  	
   

  	
   

  
	
  Schedule 3.8(b):

  	
   

  	
  Purchase Orders

  	
   

  	
   

  
	
  Schedule 3.8(c):

  	
   

  	
  Sales Representative, Distributor and
  Dealer Agreements

  	
   

  	
   

  
	
  Schedule 3.8(d):

  	
   

  	
  Personal Property Leases (as Lessee)

  	
   

  	
   

  
	
  Schedule 3.8(e):

  	
   

  	
  Noncompetition Agreements or Covenants

  	
   

  	
   

  
	
  Schedule 3.8(f):

  	
   

  	
  Confidential Nondisclosure Agreement

  	
   

  	
   

  
	
  Schedule 3.8(g):

  	
   

  	
  Consultant Agreements

  	
   

  	
   

  
	
  Schedule 3.8(h):

  	
   

  	
  Guarantees

  	
   

  	
   

  
	
  Schedule 3.8(i):

  	
   

  	
  Powers of Attorney, Proxies

  	
   

  	
   

  
	
  Schedule 3.8(j):

  	
   

  	
  Letters of Credit, Surety, Bid and
  Performance Bonds

  	
   

  	
   

  
	
  Schedule 3.8(k):

  	
   

  	
  Other Material Contracts

  	
   

  	
   

  
	
  Schedule 3.9(a):

  	
   

  	
  Intellectual Property Rights

  	
   

  	
   

  
	
  Schedule 3.9(b):

  	
   

  	
  Licenses of Intellectual Property Rights To
  or From Third Parties

  	
   

  	
   

  
	
  Schedule 3.9(c):

  	
   

  	
  Infringement

  	
   

  	
   

  
	
  Schedule 3.10:

  	
   

  	
  Patent, Trade Name, Trademark, Service
  Mark, Copyright or Chip Registration Indemnification

  	
   

  	
   

  
	
  Schedule 3.11:

  	
   

  	
  Confidential Information or Trade Secrets

  	
   

  	
   

  
	
  Schedule 3.12:

  	
   

  	
  Product and Service Warranties

  	
   

  	
   

  
	
  Schedule 3.13(a):

  	
   

  	
  Employees

  	
   

  	
   

  
	
  Schedule 3.13(b):

  	
   

  	
  Indebtedness to Employees

  	
   

  	
   

  
	
  Schedule 3.13(c):

  	
   

  	
  Loans or Advances to Employees

  	
   

  	
   

  
	
  Schedule 3.13(d):

  	
   

  	
  Collective Bargaining Agreements

  	
   

  	
   

  
	
  Schedule 3.13(f):

  	
   

  	
  Employee Benefit Plans

  	
   

  	
   

  
	
  Schedule 3.13(g):

  	
   

  	
  Employment Contracts

  	
   

  	
   

  
	
  Schedule 3.14:

  	
   

  	
  Pending or Threatened Claims, Litigation
  and Governmental Proceedings; Retained Litigation

  	
   

  	
   

  
	
  Schedule 3.15:

  	
   

  	
  Judgments, Orders and Consent Decrees

  	
   

  	
   

  
	
  Schedule 3.16:

  	
   

  	
  Compliance With Laws

  	
   

  	
   

  
	
  Schedule 3.17:

  	
   

  	
  Franchises, Permits, Etc.

  	
   

  	
   

  
	
  Schedule 3.18:

  	
   

  	
  Taxes

  	
   

  	
   

  
	
  Schedule 3.19:

  	
   

  	
  Required Consents

  	
   

  	
   

  
	
  Schedule 3.21(a):

  	
   

  	
  Insurance Policies

  	
   

  	
   

  
	
  Schedule 3.21(b):

  	
   

  	
  Bank Accounts of Transferred Subsidiaries

  	
   

  	
   

  
	
  Schedule 3.23:

  	
   

  	
  Duty of the Selling Entities to Make
  Inquiry

  	
   

  	
   

  
	
  Schedule 4.2:

  	
   

  	
  Required Consents

  	
   

  	
   

  
	
  Schedule 4.7:

  	
   

  	
  Purchaser’s Sources of Financing

  	
   

  	
   

  



 





















 


INDEX OF DEFINED TERMS


 


	
  A

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Acquisition Proposal

  	
   

  	
   

  
	
  Actual Completion Date

  	
   

  	
   

  
	
  Adjusted December Balance Sheet

  	
   

  	
   

  
	
  Affiliate

  	
   

  	
   

  
	
  Affiliate Arrangements

  	
   

  	
   

  
	
  Affiliated Group

  	
   

  	
   

  
	
  Agreement

  	
   

  	
   

  
	
  Agreement Adjustments

  	
   

  	
   

  
	
  Agreement Date

  	
   

  	
   

  
	
  Allocation

  	
   

  	
   

  
	
  Amalgamation

  	
   

  	
   

  
	
  Asset Purchasing Entity

  	
   

  	
   

  
	
  Asset Sale

  	
   

  	
   

  
	
  Assets Held for Sale

  	
   

  	
   

  
	
  Assumed Liabilities

  	
   

  	
   

  
	
  Assurances

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  B

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Basket

  	
   

  	
   

  
	
  Business

  	
   

  	
   

  
	
  Buying Interests

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  C

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Cash Difference

  	
   

  	
   

  
	
  Cash Disbursements

  	
   

  	
   

  
	
  Cash Payment

  	
   

  	
   

  
	
  Cash Receipts

  	
   

  	
   

  
	
  Certain Personnel

  	
   

  	
   

  
	
  Cincinnati Lamb Canada division

  	
   

  	
   

  
	
  Cincinnati Lamb Group

  	
   

  	
   

  
	
  Cincinnati Lamb Group December
  Balance Sheet

  	
   

  	
   

  
	
  Cincinnati Lamb U.S division

  	
   

  	
   

  
	
  Closing

  	
   

  	
   

  
	
  Closing Balance Sheet

  	
   

  	
   

  
	
  CM Korea

  	
   

  	
   

  
	
  CM Korea Shares

  	
   

  	
   

  
	
  CMUK

  	
   

  	
   

  
	
  CMUK DC Plan

  	
   

  	
   

  
	
  CMUK Plan

  	
   

  	
   

  
	
  CMUK Supplementary Plan

  	
   

  	
   

  
	
  COBRA

  	
   

  	
   

  
	
  Code

  	
   

  	
   

  
	
  Company

  	
   

  	
   

  
	
  Competitive Business

  	
   

  	
   

  
	
  Collateral

  	
   

  	
   

  
	
  Confidentiality Agreement

  	
   

  	
   

  
	
  Consideration

  	
   

  	
   

  
	
  Consultant

  	
   

  	
   

  
	
  Continuing Employees

  	
   

  	
   

  
	
  Contracts

  	
   

  	
   

  



 





















 


	
  D

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Deadline Date

  	
   

  	
   

  
	
  December Balance Sheet

  	
   

  	
   

  
	
  December Financials

  	
   

  	
   

  
	
  Deloitte Procedures

  	
   

  	
   

  
	
  Direct Litigation Option

  	
   

  	
   

  
	
  Discontinued Operations

  	
   

  	
   

  
	
  DOJ

  	
   

  	
   

  
	
  DRA

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  E

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Employee Benefit Plans

  	
   

  	
   

  
	
  Employees

  	
   

  	
   

  
	
  Environmental Activity

  	
   

  	
   

  
	
  Environmental Laws

  	
   

  	
   

  
	
  Environmental Permits

  	
   

  	
   

  
	
  Environmental Report

  	
   

  	
   

  
	
  Environmental Response Plan

  	
   

  	
   

  
	
  E-Reg

  	
   

  	
   

  
	
  ERISA Plan

  	
   

  	
   

  
	
  ETA

  	
   

  	
   

  
	
  Excluded Assets

  	
   

  	
   

  
	
  Excluded Liabilities

  	
   

  	
   

  
	
  Extended Deadline Date

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  F

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  FAS 106 Liabilities

  	
   

  	
   

  
	
  Freehold Property

  	
   

  	
   

  
	
  FSSP

  	
   

  	
   

  
	
  FSSP/UPP Transition Period

  	
   

  	
   

  
	
  FTC

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  G

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  GAAP

  	
   

  	
   

  
	
  Governmental Body

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  H

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Hazardous Substance

  	
   

  	
   

  
	
  Honsberg

  	
   

  	
   

  
	
  HSR Act

  	
   

  	
   

  
	
  HSR Filing

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  I

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Indemnified Party

  	
   

  	
   

  
	
  Indemnifying Party

  	
   

  	
   

  
	
  Indemnifying Purchasing Entities

  	
   

  	
   

  
	
  Indemnifying Selling Entities

  	
   

  	
   

  
	
  Independent Firm

  	
   

  	
   

  
	
  Intellectual Property

  	
   

  	
   

  
	
  Interim Period

  	
   

  	
   

  
	
  Intermec

  	
   

  	
   

  
	
  Intermec Canada

  	
   

  	
   

  
	
  Investigation Period

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  L

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Lamb U.K. division

  	
   

  	
   

  
	
  Lamb U.K. Restructure Note

  	
   

  	
   

  
	
  Lamb U.K. Restructure Plan

  	
   

  	
   

  
	
  Landlord’s Consent

  	
   

  	
   

  
	
  Law

  	
   

  	
   

  
	
  Leased Real Property

  	
   

  	
   

  
	
  Leasehold Properties

  	
   

  	
   

  
	
  Legally Required Statement

  	
   

  	
   

  
	
  LIBOR

  	
   

  	
   

  
	
  Lien

  	
   

  	
   

  
	
  Liens

  	
   

  	
   

  
	
  Licensed Intellectual Property

  	
   

  	
   

  
	
  Litigation Required Employees

  	
   

  	
   

  
	
  Litigation Termination Date

  	
   

  	
   

  
	
  Loss

  	
   

  	
   

  
	
  Losses

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  M

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Mainco

  	
   

  	
   

  
	
  material adverse change

  	
   

  	
   

  
	
  material adverse effect

  	
   

  	
   

  
	
  McDonald

  	
   

  	
   

  
	
  Mexico VAT Depost

  	
   

  	
   

  
	
  MTN

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  N

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  New Intermec Canada

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  O

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Offsite Disposal

  	
   

  	
   

  
	
  Other Retained Litigation

  	
   

  	
   

  
	
  Owned Real Property

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  P

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Parties

  	
   

  	
   

  
	
  Party

  	
   

  	
   

  
	
  Pension Arrangement

  	
   

  	
   

  
	
  Performance Bonds

  	
   

  	
   

  
	
  Permitted Lien

  	
   

  	
   

  
	
  Permitted Liens

  	
   

  	
   

  
	
  Person

  	
   

  	
   

  
	
  Phase I

  	
   

  	
   

  
	
  Phase II

  	
   

  	
   

  
	
  Plan Deeds

  	
   

  	
   

  
	
  Preliminary Cash Difference

  	
   

  	
   

  
	
  Preliminary Closing Balance Sheet

  	
   

  	
   

  
	
  Product Liability

  	
   

  	
   

  



 


2





















 


	
  Purchase Orders

  	
   

  	
   

  
	
  Purchase Price

  	
   

  	
   

  
	
  Purchased Assets

  	
   

  	
   

  
	
  Purchaser

  	
   

  	
   

  
	
  Purchaser Subsidiaries

  	
   

  	
   

  
	
  Purchaser’s 401(k) Plan

  	
   

  	
   

  
	
  Purchasing Entities

  	
   

  	
   

  
	
  Purchasing Entities Schedule

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  R

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  R&B

  	
   

  	
   

  
	
  R&B Cash Payment

  	
   

  	
   

  
	
  R&B Liabilities

  	
   

  	
   

  
	
  R&B Shares

  	
   

  	
   

  
	
  Real Property

  	
   

  	
   

  
	
  Receiving Party

  	
   

  	
   

  
	
  Registered Properties

  	
   

  	
   

  
	
  Related Agreements

  	
   

  	
   

  
	
  Relevant Properties

  	
   

  	
   

  
	
  Retained Environmental Liability

  	
   

  	
   

  
	
  Retained Litigation

  	
   

  	
   

  
	
  Review Period

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  S

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Sales Order

  	
   

  	
   

  
	
  Sales Orders

  	
   

  	
   

  
	
  Section 1060 Allocation

  	
   

  	
   

  
	
  Section 338 Allocation

  	
   

  	
   

  
	
  Section 338 Forms

  	
   

  	
   

  
	
  Section 338(h)(10) Election

  	
   

  	
   

  
	
  Section 338(h)(10) Elections

  	
   

  	
   

  
	
  Secured Note

  	
   

  	
   

  
	
  Securities Act

  	
   

  	
   

  
	
  Seller Names

  	
   

  	
   

  
	
  Selling Entities

  	
   

  	
   

  
	
  Selling Interests

  	
   

  	
   

  
	
  Severance Terms

  	
   

  	
   

  
	
  Shares

  	
   

  	
   

  
	
  Specified Litigation

  	
   

  	
   

  
	
  Statement of Objections

  	
   

  	
   

  
	
  Stock Sale

  	
   

  	
   

  
	
  STT

  	
   

  	
   

  
	
  Subsurface Environmental
  Investigation

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  T

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Tax Contest

  	
   

  	
   

  
	
  Tax Returns

  	
   

  	
   

  
	
  Taxes

  	
   

  	
   

  
	
  Tendering Party

  	
   

  	
   

  
	
  the Competitive Business

  	
   

  	
   

  
	
  Third Party Claim

  	
   

  	
   

  
	
  Transactions

  	
   

  	
   

  
	
  Transfer Date

  	
   

  	
   

  
	
  Transferred Subsidiaries

  	
   

  	
   

  
	
  Transferring Employees

  	
   

  	
   

  
	
  Transferring Selling Entities

  	
   

  	
   

  
	
  Transitional Services Agreement

  	
   

  	
   

  
	
  TUPE

  	
   

  	
   

  



 


3





















 


	
  U

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  U.K. Employees

  	
   

  	
   

  
	
  U.K. Pension Plans

  	
   

  	
   

  
	
  U.S. Employees

  	
   

  	
   

  
	
  UIASI

  	
   

  	
   

  
	
  UII

  	
   

  	
   

  
	
  UII Shares

  	
   

  	
   

  
	
  UNOVA

  	
   

  	
   

  
	
  UNOVA Canada

  	
   

  	
   

  
	
  UNOVA IP

  	
   

  	
   

  
	
  UNOVA UK

  	
   

  	
   

  
	
  UPF

  	
   

  	
   

  
	
  UPP

  	
   

  	
   

  



 


4