Exhibit 10.1 


EXECUTION COPY 


STOCK AND ASSET PURCHASE AGREEMENT


BY AND AMONG


AUTOPARTS HOLDINGS LIMITED


HONEYWELL INTERNATIONAL INC.


AND


RANK GROUP LIMITED





TABLE OF CONTENTS


	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
 Page

 
	
  

 	
  

 	
  

 	
  

 	
  

 	

 


 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 ARTICLE I

 	
 PURCHASE AND
 SALE OF ASSETS; ASSUMPTION OF LIABILITIES

 	
  

 	
 1

 
	
  

 	
 Section 1.1.

 	
  

 	
 Transactional
 Overview; Purchase and Sale of Assets

 	
  

 	
 1

 
	
  

 	
 Section 1.2.

 	
  

 	
 Retained
 Assets

 	
  

 	
 6

 
	
  

 	
 Section 1.3.

 	
  

 	
 Assumed
 Liabilities

 	
  

 	
 7

 
	
  

 	
 Section 1.4.

 	
  

 	
 Retained
 Liabilities

 	
  

 	
 8

 
	
  

 	
 Section 1.5.

 	
  

 	
 Liabilities
 of the Transferred Entities

 	
  

 	
 9

 
	
  

 	
 Section 1.6.

 	
  

 	
 Purchase
 Price

 	
  

 	
 10

 
	
  

 	
 Section 1.7.

 	
  

 	
 [Intentionally
 omitted]

 	
  

 	
 10

 
	
  

 	
 Section 1.8.

 	
  

 	
 Purchase
 Price Adjustment

 	
  

 	
 10

 
	
  

 	
 Section 1.9.

 	
  

 	
 Withholding

 	
  

 	
 12

 
	
 ARTICLE II

 	
 CLOSING;
 CLOSING DELIVERIES

 	
  

 	
 12

 
	
  

 	
 Section 2.1.

 	
  

 	
 Closing Date

 	
  

 	
 12

 
	
  

 	
 Section 2.2.

 	
  

 	
 Effectiveness

 	
  

 	
 13

 
	
  

 	
 Section 2.3.

 	
  

 	
 Closing
 Deliveries

 	
  

 	
 13

 
	
  

 	
 Section 2.4.

 	
  

 	
 Allocation
 of Purchase Price

 	
  

 	
 14

 
	
 ARTICLE III

 	
 REPRESENTATIONS
 AND WARRANTIES OF HONEYWELL

 	
  

 	
 15

 
	
  

 	
 Section 3.1.

 	
  

 	
 Due
 Organization

 	
  

 	
 15

 
	
  

 	
 Section 3.2.

 	
  

 	
 Authority

 	
  

 	
 16

 
	
  

 	
 Section 3.3.

 	
  

 	
 Transferred
 Entities; Title to Equity Interests

 	
  

 	
 16

 
	
  

 	
 Section 3.4.

 	
  

 	
 No Conflict;
 Government Authorizations and Third Party Approvals

 	
  

 	
 17

 
	
  

 	
 Section 3.5.

 	
  

 	
 Financial
 Statements

 	
  

 	
 17

 
	
  

 	
 Section 3.6.

 	
  

 	
 Absence of
 Certain Changes; Undisclosed Liabilities

 	
  

 	
 18

 
	
  

 	
 Section 3.7.

 	
  

 	
 Taxes

 	
  

 	
 18

 
	
  

 	
 Section 3.8.

 	
  

 	
 Intellectual
 Property

 	
  

 	
 20

 
	
  

 	
 Section 3.9.

 	
  

 	
 Legal
 Proceedings

 	
  

 	
 21

 
	
  

 	
 Section 3.10.

 	
  

 	
 Compliance
 with Laws; Permits

 	
  

 	
 21

 
	
  

 	
 Section 3.11.

 	
  

 	
 Environmental
 Matters

 	
  

 	
 22

 


i





TABLE OF CONTENTS
(continued)


	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
 Page

 
	
  

 	
  

 	
  

 	
  

 	
  

 	

 


 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 Section 3.12.

 	
  

 	
 Employee
 Matters and Benefit Plans

 	
  

 	
 23

 
	
  

 	
 Section 3.13.

 	
  

 	
 Contracts

 	
  

 	
 24

 
	
  

 	
 Section 3.14.

 	
  

 	
 Real
 Properties

 	
  

 	
 25

 
	
  

 	
 Section 3.15.

 	
  

 	
 Business
 Personal Property and Business Inventory; Transfer of Title to Purchased
 Assets

 	
  

 	
 27

 
	
  

 	
 Section 3.16.

 	
  

 	
 Sufficiency
 of Assets

 	
  

 	
 27

 
	
  

 	
 Section 3.17.

 	
  

 	
 Labor

 	
  

 	
 27

 
	
  

 	
 Section 3.18.

 	
  

 	
 Insurance

 	
  

 	
 28

 
	
  

 	
 Section 3.19.

 	
  

 	
 Finder’s Fee

 	
  

 	
 28

 
	
  

 	
 Section 3.20.

 	
  

 	
 Affiliate
 Transactions

 	
  

 	
 28

 
	
  

 	
 Section 3.21.

 	
  

 	
 Warranties

 	
  

 	
 28

 
	
  

 	
 Section 3.22.

 	
  

 	
 Customers
 and Suppliers

 	
  

 	
 29

 
	
  

 	
 Section 3.23.

 	
  

 	
 Disclaimer
 of Other Representations and Warranties

 	
  

 	
 29

 
	
 ARTICLE IV

 	
 REPRESENTATIONS
 AND WARRANTIES OF PURCHASER AND RANK GROUP

 	
  

 	
 29

 
	
  

 	
 Section 4.1.

 	
  

 	
 Corporate
 Status

 	
  

 	
 29

 
	
  

 	
 Section 4.2.

 	
  

 	
 Authority

 	
  

 	
 29

 
	
  

 	
 Section 4.3.

 	
  

 	
 No Conflict;
 Required Filings

 	
  

 	
 30

 
	
  

 	
 Section 4.4.

 	
  

 	
 Finder’s Fee

 	
  

 	
 30

 
	
  

 	
 Section 4.5.

 	
  

 	
 Solvency

 	
  

 	
 30

 
	
  

 	
 Section 4.6.

 	
  

 	
 Financing

 	
  

 	
 31

 
	
  

 	
 Section 4.7.

 	
  

 	
 No Reliance

 	
  

 	
 31

 
	
 ARTICLE V

 	
 CERTAIN
 COVENANTS

 	
  

 	
 32

 
	
  

 	
 Section 5.1.

 	
  

 	
 Conduct of
 the Business

 	
  

 	
 31

 
	
  

 	
 Section 5.2.

 	
  

 	
 Confidentiality;
 Access to Information

 	
  

 	
 35

 
	
  

 	
 Section 5.3.

 	
  

 	
 Publicity

 	
  

 	
 36

 
	
  

 	
 Section 5.4.

 	
  

 	
 Post Closing
 Access

 	
  

 	
 36

 
	
  

 	
 Section 5.5.

 	
  

 	
 Required
 Approvals; Consents

 	
  

 	
 37

 
	
  

 	
 Section 5.6.

 	
  

 	
 Further
 Action

 	
  

 	
 39

 


ii





TABLE OF CONTENTS

(continued)


	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
 Page

 
	
  

 	
  

 	
  

 	
  

 	
  

 	

 


 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 Section 5.7.

 	
  

 	
 Expenses;
 Transfer Taxes and VAT

 	
  

 	
 40

 
	
  

 	
 Section 5.8.

 	
  

 	
 Employees
 and Employee Benefit Plans

 	
  

 	
 41

 
	
  

 	
 Section 5.9.

 	
  

 	
 Intercompany
 Accounts

 	
  

 	
 53

 
	
  

 	
 Section 5.10.

 	
  

 	
 Non-Solicitation
 of Employees

 	
  

 	
 53

 
	
  

 	
 Section 5.11.

 	
  

 	
 Non-Competition
 Covenant

 	
  

 	
 53

 
	
  

 	
 Section 5.12.

 	
  

 	
 Confidential
 Information

 	
  

 	
 55

 
	
  

 	
 Section 5.13.

 	
  

 	
 Payments
 Received

 	
  

 	
 55

 
	
  

 	
 Section 5.14.

 	
  

 	
 Sellers’
 Marks

 	
  

 	
 55

 
	
  

 	
 Section 5.15.

 	
  

 	
 Tax Matters

 	
  

 	
 56

 
	
  

 	
 Section 5.16.

 	
  

 	
 Bulk Sales
 Laws

 	
  

 	
 62

 
	
  

 	
 Section 5.17.

 	
  

 	
 Notice of
 Developments

 	
  

 	
 62

 
	
  

 	
 Section 5.18.

 	
  

 	
 Conduct of
 Incidents Subject to Parent Insurances

 	
  

 	
 62

 
	
  

 	
 Section 5.19.

 	
  

 	
 Replacement
 Letters of Credit

 	
  

 	
 63

 
	
  

 	
 Section 5.20.

 	
  

 	
 Affiliate
 Agreements

 	
  

 	
 63

 
	
  

 	
 Section 5.21.

 	
  

 	
 Exclusivity

 	
  

 	
 63

 
	
  

 	
 Section 5.22.

 	
  

 	
 Financing

 	
  

 	
 64

 
	
  

 	
 Section 5.23.

 	
  

 	
 Cooperation
 with Financing

 	
  

 	
 64

 
	
  

 	
 Section 5.24.

 	
  

 	
 Certain
 Financial Information; Post-Closing Cooperation with Financing

 	
  

 	
 67

 
	
  

 	
 Section 5.25.

 	
  

 	
 Termination
 of Outstanding Powers of Attorney

 	
  

 	
 69

 
	
  

 	
 Section 5.26.

 	
  

 	
 Rank Group
 Guarantee

 	
  

 	
 69

 
	
  

 	
 Section 5.27.

 	
  

 	
 Holt Lloyd
 SA

 	
  

 	
 70

 
	
 ARTICLE VI

 	
 CONDITIONS
 TO OBLIGATIONS OF PURCHASER

 	
  

 	
 70

 
	
  

 	
 Section 6.1.

 	
  

 	
 Absence of
 Injunction

 	
  

 	
 70

 
	
  

 	
 Section 6.2.

 	
  

 	
 Deliveries
 of Sellers

 	
  

 	
 70

 
	
  

 	
 Section 6.3.

 	
  

 	
 No Breach

 	
  

 	
 70

 
	
  

 	
 Section 6.4.

 	
  

 	
 Antitrust
 and Foreign Investment Clearances; Certain Litigation

 	
  

 	
 71

 
	
  

 	
 Section 6.5.

 	
  

 	
 No Business
 Material Adverse Effect

 	
  

 	
 71

 


iii





TABLE OF CONTENTS

(continued)


	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
 Page

 
	
  

 	
  

 	
  

 	
  

 	
  

 	

 


 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 Section 6.6.

 	
  

 	
 Marketing
 Period

 	
  

 	
 71

 
	
  

 	
 Section 6.7.

 	
  

 	
 Closing
 Certificate

 	
  

 	
 71

 
	
 ARTICLE VII

 	
 CONDITIONS
 TO OBLIGATIONS OF SELLERS

 	
  

 	
 71

 
	
  

 	
 Section 7.1.

 	
  

 	
 Absence of
 Injunction

 	
  

 	
 71

 
	
  

 	
 Section 7.2.

 	
  

 	
 Deliveries
 of Purchaser

 	
  

 	
 71

 
	
  

 	
 Section 7.3.

 	
  

 	
 No Breach

 	
  

 	
 71

 
	
  

 	
 Section 7.4.

 	
  

 	
 Antitrust
 and Foreign Investment Clearances; Certain Litigation

 	
  

 	
 72

 
	
  

 	
 Section 7.5.

 	
  

 	
 Closing
 Certificate

 	
  

 	
 72

 
	
 ARTICLE VIII

 	
 TERMINATION;
 EFFECT OF TERMINATION

 	
  

 	
 72

 
	
  

 	
 Section 8.1.

 	
  

 	
 Termination

 	
  

 	
 72

 
	
  

 	
 Section 8.2.

 	
  

 	
 Effect of
 Termination

 	
  

 	
 73

 
	
 ARTICLE IX

 	
 SURVIVAL;
 INDEMNIFICATION

 	
  

 	
 73

 
	
  

 	
 Section 9.1.

 	
  

 	
 Survival of
 Representations, Warranties and Agreements

 	
  

 	
 73

 
	
  

 	
 Section 9.2.

 	
  

 	
 Indemnification

 	
  

 	
 74

 
	
  

 	
 Section 9.3.

 	
  

 	
 Indemnification
 Procedures

 	
  

 	
 74

 
	
  

 	
 Section 9.4.

 	
  

 	
 Indemnification
 Limitations

 	
  

 	
 76

 
	
  

 	
 Section 9.5.

 	
  

 	
 No Rights of
 Offset

 	
  

 	
 81

 
	
 ARTICLE X

 	
 MISCELLANEOUS

 	
  

 	
 81

 
	
  

 	
 Section 10.1.

 	
  

 	
 Notices

 	
  

 	
 81

 
	
  

 	
 Section 10.2.

 	
  

 	
 Certain
 Definitions; Interpretation

 	
  

 	
 82

 
	
  

 	
 Section 10.3.

 	
  

 	
 Severability

 	
  

 	
 101

 
	
  

 	
 Section 10.4.

 	
  

 	
 Entire
 Agreement; No Third-Party Beneficiaries

 	
  

 	
 101

 
	
  

 	
 Section 10.5.

 	
  

 	
 Amendment;
 Waiver

 	
  

 	
 102

 
	
  

 	
 Section 10.6.

 	
  

 	
 Binding
 Effect; Assignment

 	
  

 	
 102

 
	
  

 	
 Section 10.7.

 	
  

 	
 Disclosure
 Schedules

 	
  

 	
 102

 
	
  

 	
 Section 10.8.

 	
  

 	
 Specific
 Performance

 	
  

 	
 102

 
	
  

 	
 Section 10.9.

 	
  

 	
 Governing Law

 	
  

 	
 103

 
	
  

 	
 Section 10.10.

 	
  

 	
 Jurisdiction

 	
  

 	
 103

 


iv





TABLE OF CONTENTS

(continued)


	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
 Page

 
	
  

 	
  

 	
  

 	
  

 	
  

 	

 


 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 Section 10.11.

 	
  

 	
 Construction

 	
  

 	
 103

 
	
  

 	
 Section 10.12.

 	
  

 	
 Counterparts

 	
  

 	
 104

 
	
  

 	
 Section 10.13

 	
  

 	
 Delayed
 Closing

 	
  

 	
 104

 


v





STOCK AND ASSET PURCHASE AGREEMENT


          THIS STOCK
AND ASSET PURCHASE AGREEMENT (this “Agreement”)
is made this 27th day of January 2011, by and among (i) Autoparts Holdings
Limited, a New Zealand company (“Purchaser”),
(ii) Honeywell International Inc., a Delaware corporation (“Honeywell”), on behalf of itself and the
entities listed on Schedule A (Honeywell and each such entity is
referred to herein individually as a “Seller”
and collectively as “Sellers”)
and, for purposes of Article IV, Sections 5.22, 5.23, 5.26
and Article X, Rank Group Limited, a New Zealand company (“Rank Group”). 


          WHEREAS,
Sellers and the Transferred Entities (as defined below) are engaged in the
Business. 


          WHEREAS,
Sellers conduct the Business through the entities listed on Schedule B
(the “Transferred Entities” and
each a “Transferred Entity”) and
through the use of certain assets held directly by Sellers. 


          WHEREAS,
upon the terms and subject to the conditions contained in this Agreement,
Purchaser desires to acquire from Sellers, and Sellers desire to sell and
assign to Purchaser, all of Sellers’ ownership interest in the Purchased
Entities set forth on Schedule C. 


          WHEREAS,
upon the terms and subject to the conditions contained in this Agreement,
Purchaser desires to acquire from Sellers the Purchased Assets and assume the
Assumed Liabilities, and Sellers desire to sell and assign to Purchaser the
Purchased Assets and Assumed Liabilities. 


          NOW,
THEREFORE, in consideration of the mutual promises, covenants and agreements
herein contained, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as follows: 


ARTICLE I


PURCHASE AND SALE OF ASSETS;
ASSUMPTION OF LIABILITIES


          Section
1.1. Transactional Overview; Purchase and
Sale of Assets. 


                    (a)
Transfer of Equity Interests in Purchased Entities. 


                              (i)
Prestone Products Corporation. Sellers’ ownership interest in Prestone
Products Corporation, a Delaware corporation and a wholly-owned subsidiary of
Honeywell (“Prestone”), will be
transferred to Purchaser pursuant to the sale by Honeywell of its Equity
Interests in Prestone to Purchaser, in accordance with the other Sections of
this Agreement. 





                              (ii)
South Africa, New Zealand and Japan Purchased Entities. Sellers’
ownership interests in Holts (Proprietary) Ltd., a South African company and a
wholly-owned subsidiary of Honeywell (“Holts
South Africa”), Holt Lloyd Limited, a New Zealand company and a
wholly-owned subsidiary of Honeywell (“Holt
New Zealand”), and Musashi Holt Co. Ltd., a Japanese company (“Holt Japan”), will be transferred to
Purchaser pursuant to the sale by Honeywell of its Equity Interests in Holts
South Africa, Holt New Zealand and Holt Japan to Purchaser, in accordance with
the other Sections of this Agreement. 


                              (iii)
UK Purchased Entity. Sellers’ ownership interest in Holt Lloyd Group
Limited, a UK limited company (“Holt UK”),
will be transferred to Purchaser pursuant to the sale by Honeywell
International UK Ltd., a UK limited company and wholly owned subsidiary of
Honeywell (“Honeywell International UK”),
of its Equity Interests in Holt UK to Purchaser, in accordance with the other
Sections of this Agreement. 


                    (b)
Asset Transfers. Sellers’ ownership interest in certain Purchased Assets
of the Business located outside the United States will be transferred to
Purchaser pursuant to the sales by Honeywell Aftermarket Europe SAS, a French
company (“Honeywell France”),
Honeywell Productos Automotrices SA de C.V., a Mexican company (“Honeywell Mexico 1”), Honeywell Automotive
de Mexico SA de C.V., a Mexican company (“Honeywell
Mexico 2”), Honeywell Asca Inc., a Canadian corporation (“Honeywell Canada”), Honeywell (Singapore)
Pte. Ltd., a private limited company (“Honeywell
Singapore”), and Honeywell Automotive Parts Services (Shanghai) Co.
Ltd., a Chinese limited company (“Honeywell
China”), to Purchaser, and Sellers’ ownership interest in the
Purchased Assets located in the United States will be transferred to Purchaser
by Honeywell, in each case in accordance with the other Sections of this
Agreement. 


                    (c)
Purchased Assets. Subject to the terms and conditions of this Agreement,
at the Closing, in exchange for a payment by Purchaser to Sellers of the
Purchase Price and Purchaser’s assumption of the Assumed Liabilities, Sellers
shall sell, assign, transfer, convey and deliver, or cause to be sold,
assigned, transferred, conveyed and delivered, to Purchaser all of Sellers’ or
their Affiliates’ (other than any Transferred Entity’s) right, title and
interest in and to all of the assets, property and rights primarily or
exclusively used or held for use in the conduct of the Business as of the
Closing Date, which the parties agree shall include all of the assets, property
and rights of the types set forth or described below, but excluding the
Retained Assets and the Transferred Entities’ Retained Assets transferred to
the Sellers pursuant to Section 1.1(d)(ii) (collectively, the “Purchased Assets”): 


                              (i)
the Equity Interests in the Purchased Entities; 


                              (ii)
the goodwill of Sellers relating to the Business; 


                              (iii)
all Business Inventory (including all Business Products); 


                              (iv)
all Business Personal Property; 


                              (v)
the Intellectual Property and Software owned by the Sellers or their Affiliates
(other than the Transferred Entities) and used primarily in the conduct of the
Business, 


2





including the Registered Intellectual Property and Software owned by
the Sellers or their Affiliates (other than the Transferred Entities) and used
primarily in the conduct of the Business, in each case as set forth on Schedule
1.1(c)(v), except for the Excluded Intellectual Property (collectively, the
“Purchased Intellectual Property”),
and all rights of any Seller or its Affiliate (other than any Transferred
Entity) under any agreement providing for (A) the nondisclosure by any Employee
or contractor of the Business of any confidential information of the Business
included in the Purchased Intellectual Property or (B) an assignment to any
Seller or its Affiliate (other than any Transferred Entity) with respect to any
Purchased Intellectual Property developed by any such Employee or contractor, including
each Employee Agreement Relating to Trade Secrets, Proprietary and Confidential
Information; 


                              (vi)
all Contracts primarily relating to the Business, including all non-disclosure
agreements executed in connection with the potential sale of all or part of the
Business (collectively, the “Assumed
Contracts”); 


                              (vii)
the real property leases set forth on Schedule 1.1(c)(vii) (the “Assumed Real Property Leases”); 


                              (viii)
the real properties owned by Sellers or by Allied-Signal Automotive of Canada,
Inc. (“ASAC”) set forth on Schedule
1.1(c)(viii) (the “Purchased Owned Real Property”); 


                              (ix)
all Permits primarily used in the conduct of the Business and held by Sellers
to the extent the same, or a right to use the same, can be transferred to
Purchaser; 


                              (x)
all of Sellers’ customer and vendor lists to the extent applicable to the
Business, all of Sellers’ files and documents (including credit information) to
the extent applicable to the Business, including all of Sellers’ equipment
maintenance data, accounting records, Tax records (including Tax Returns, but
only to the extent relating specifically to the Business or to the Transferred
Entities) inventory records, sales and sales promotional data, package inserts,
instruction manuals, owner’s manuals, labels, advertising materials, cost and
pricing information, business plans, reference catalogs, transactional records,
and any other such data and records, however stored, in each case to the extent
applicable to the Business, but excluding any documents relating exclusively to
the Honeywell Filter Litigation; provided, however, that Sellers
shall be entitled to retain copies of any such materials which are necessary
for, and may use such copies solely in connection with, their Tax, accounting
or legal compliance purposes, provided that such copies and all
information contained therein shall be Confidential Information subject to the
provisions of Section 5.12 and shall otherwise be subject to the provisions
of Section 5.4(b); 


                              (xi)
Closing Date Cash; 


                              (xii)
all claims, causes of action, choses in action, rights of recovery and rights
of setoff of any kind, rights to proceeds under insurance policies in respect
of claims made against such policies prior to Closing (other than insurance
proceeds paid pursuant to claims made by Honeywell and its Affiliates in
connection with the earthquakes in the area of Mexicali, Mexico in 2008) to the
extent related to the Business and rights under and pursuant to all 


3





warranties, representations, indemnities and guarantees made by
suppliers of products, materials or equipment, or components thereof to the
extent related to the Business; 


                              (xiii)
all trade accounts receivable and trade notes receivable of the Business,
whether recorded or unrecorded, other than such trade receivables from
divisions or Affiliates of Sellers that are not Transferred Entities or other
parts of the Business; 


                              (xiv)
all accounts receivable and notes receivable of the Business, whether recorded
or unrecorded, from divisions or Affiliates of Sellers that are Transferred
Entities or other transferred portions of the Business; 


                              (xv)
all prepaid expenses and deposits to the extent applicable to the Business, but
only to the extent such prepaid expenses and deposits will accrue to the
benefit of Purchaser in respect of the Business on and following the Closing; 


                              (xvi)
all credits and refunds of Taxes (other than Income Taxes) of or payable with
respect to the Business (other than a Transferred Entity) or any Purchased
Asset to the extent attributable to a Post-Reference Date Tax Period; and 


                              (xvii)
all rights, assets and entitlements in or related to a Seller’s participation
in or sponsorship of any Transferred U.S. Benefit Plans or Transferred Foreign
Benefit Plans and under any of the Labor Contracts. 


                    (d)
Assets of the Transferred Entities. 


                              (i)
The parties agree that none of the assets, properties or rights of the
Transferred Entities shall be transferred pursuant to Section 1.1(c) or
shall be considered Purchased Assets for the purposes of Section 1.1(c)
hereof and that such assets, properties and rights (including Equity Interests
of a Transferred Entity in another Transferred Entity) shall be held by the
relevant Transferred Entity, in the same manner before and after the Closing
Date without any change therein as a result of the transactions contemplated
hereunder, except that Purchaser shall be the holder of the Equity Interests of
the Purchased Entities. 


                              (ii)
The following assets shall be transferred from the applicable Transferred
Entity to a Seller (or an Affiliate) prior to the Closing (the “Transferred Entities Retained Assets”); provided
that any instruments of transfer or conveyance executed in connection with such
transfers shall be reasonably acceptable to Purchaser: 


                                        (A)
the bank accounts of Prestone; 


                                        (B)
all accounts and notes receivable of the Transferred Entity, whether recorded
or unrecorded, from divisions or Affiliates of Sellers that are not other
Transferred Entities or other parts of the Business; 


                                        (C)
except as otherwise provided in Section 5.8, all rights, assets and
entitlements in or related to a Transferred Entity’s participation in or
sponsorship of any U.S. Benefit Plan or Foreign Benefit Plan; 


4






                                        (D)
all rights in and benefits arising from claims and litigation that relate to
the Transferred Entities Retained Assets, the Retained Assets or the Retained
Liabilities; 


                                        (E)
any rights of such Transferred Entity or its respective Affiliates to
reimbursements, indemnification, hold-harmless or similar rights to the extent
relating to any Retained Liabilities; 


                                        (F)
all Excluded Intellectual Property and Sellers’ Marks, and all Contracts with
respect to such Excluded Intellectual Property and Sellers’ Marks; and 


                                        (G)
the assets set forth on Schedule 1.1(d)(ii)(G). 


                    (e)
Assignment of Assets. 


                              (i)
Anything in this Agreement to the contrary notwithstanding, Sellers shall not
sell, assign, convey or transfer to Purchaser any Purchased Asset or any claim,
right or benefit thereunder or arising therefrom, to the extent that an
attempted assignment, transfer, sale or attempted sale of any Purchased Asset
or any claim, right or benefit thereunder or arising therefrom to be sold,
conveyed, transferred or assigned to Purchaser (collectively, the “Interests”) would constitute a breach or a
violation of any applicable Law or if such Interest is not capable of being
sold, conveyed, transferred or assigned without any third party consent which
has not been obtained by (or does not remain in full force and effect at) the
Closing, unless and until such Interest (a “Retained
Interest”) can be sold, conveyed, transferred and assigned in
accordance with Section 1.1(c) without such a breach, violation of Law
or such third party consent is obtained, at which time such Retained Interest
shall be deemed to be sold, conveyed, transferred and assigned in accordance
with Section 1.1(c) and shall cease to be a Retained Interest. 


                              (ii)
To the extent that any Interest cannot be sold, conveyed, transferred or
assigned without a breach or violation of Law, or any of the third party
consents necessary to sell, convey, transfer or assign any Interest has not
been obtained (or does not remain in full force and effect) as of the Closing
Date, Sellers and Purchaser shall, while such Interest remains a Retained
Interest, use their commercially reasonable efforts to (A) cooperate in any
reasonable and lawful arrangements designed to provide the benefits of such
Retained Interest to Purchaser (including performance by Sellers as agent), and
Purchaser shall promptly pay or satisfy the corresponding liabilities and
obligations to the extent Purchaser would have been responsible therefor if
there had been no such breach or violation of Law, or such third party consent
had been obtained, and such Retained Interest had been transferred to Purchaser
as of the Closing, but only to the extent Purchaser obtains the benefits of
such Retained Interest; and (B) enforce, at the request of Purchaser, and
subject to Purchaser’s prompt reimbursement of Sellers’ out of pocket costs,
any rights of Sellers arising from such Retained Interest against the issuer
thereof or the other party or parties thereto (including the right to elect to
terminate any such Retained Interest in accordance with the terms thereof upon
the advice of Purchaser). The failure of any third party consent or approval to
be obtained or the failure of any Interest to constitute a Purchased Asset or
any circumstances resulting therefrom shall not, individually or in the
aggregate, constitute a Business Material Adverse Effect or a breach by any
Seller of any 


5





representation, warranty, condition, covenant or agreement contained in
this Agreement, other than, if breached, Sections 3.4, 5.1 and 5.5(b);
provided that nothing in the foregoing shall limit any rights of Purchaser
under Section 6.3 or Article IX in respect of a breach of such
Sections. 


          Section
1.2. Retained Assets. The “Retained Assets” shall consist of each
Seller’s rights, title and interest in all assets of every kind and description
that are not expressly identified as Purchased Assets, and shall include the
following: 


                    (a)
all checkbooks, canceled checks and bank accounts of each Seller;


                    (b)
all accounts and notes receivable of each Seller, whether recorded or
unrecorded, from divisions or Affiliates of Sellers that are not Transferred
Entities or other parts of the Business;


                    (c)
all Permits which are not legally transferable; 


                    (d)
all rights in and benefits arising from claims and litigation that relate to
the Retained Assets or Retained Liabilities; 


                    (e)
all rights of Sellers and their Affiliates under this Agreement and each
Seller’s corporate charter or formation documents, minute and stock record
books, corporate seal and Tax records (including Tax Returns), except Tax
Returns relating specifically to the Business or the Transferred Entities; 


                    (f)
subject to Section 5.8, all insurance policies and rights thereunder,
including the benefit of any deposits or prepayments and any insurance proceeds
covering any portion of any Retained Liabilities, other than proceeds of
insurance policies in respect of claims made against such policies prior to
Closing, which shall constitute a Purchased Asset to the extent attributable to
the Business; for avoidance of doubt, any proceeds of insurance policies in
respect of claims made in connection with the matters set forth on Schedule
1.4(g) shall be Retained Assets; 


                    (g)
any rights of any Seller or their respective Affiliates to reimbursements,
indemnification, hold-harmless or similar rights to the extent relating to any
Retained Liabilities; 


                    (h)
all Excluded Intellectual Property and Sellers’ Marks, and all Contracts
relating to the Excluded Intellectual Property and Sellers’ Marks; 


                    (i)
the Contracts identified on Schedule 1.2(i) (the “Retained Contracts”); 


                    (j)
all refunds or credits of Taxes of or payable with respect to the Business
(other than a Transferred Entity) or any Purchased Asset (i) in the case of
Income Taxes, to the extent attributable to a Pre-Closing Date Tax Period and
(ii) in the case of non-Income Taxes, to the extent attributable to a
Pre-Reference Date Tax Period; 


                    (k)
except as otherwise provided in Section 5.8, all rights of Sellers and
their respective Affiliates in or under, and in all assets and entitlements
related to all U.S. Benefit Plans and Foreign Benefit Plans; 


6





                    (l)
any employee data which relates to employees who are not Transferred U.S.
Employees or Transferred Non-U.S. Employees or which Sellers are prohibited by
Law or agreement from disclosing or delivering to Purchaser; 


                    (m)
all assets, Contracts and rights of the Business used primarily in the conduct
of the Excluded Business; and 


                    (n)
the assets set forth on Schedule 1.2(n). 


          Section
1.3. Assumed Liabilities. Subject
to the terms and conditions of this Agreement, at the Closing, Purchaser shall
assume and agree to discharge and perform when due all Liabilities of each
Seller and its Affiliates (other than the Transferred Entities) to the extent
incurred in the conduct of the Business or to the extent arising from the
ownership, use or operation of any Purchased Assets, whether arising before, on
or after the Closing (but excluding the Retained Liabilities, which shall be
retained by Sellers) (collectively, the “Assumed
Liabilities”), including the following Liabilities: 


                    (a)
all Liabilities as of the Closing of the type set forth on a balance sheet
prepared in accordance with GAAP (as applied in the Year-End Financial
Statements) other than those that constitute Retained Liabilities; 


                    (b)
all Liabilities of any Seller arising under the Assumed Contracts; 


                    (c)
all Liabilities of any Seller arising under the Assumed Real Property Leases; 


                    (d)
all Liabilities for allowances, credits or adjustments to which customers of
the Business may be entitled; 


                    (e)
all Liabilities for product warranty or Product Liability Claims to the extent
related to the Business; 


                    (f)
all Liabilities relating to pending claims or litigation related to the
Business; 


                    (g)
all Liabilities relating to the Transferred U.S. Employees and the Transferred
Non-U.S. Employees that are specifically assumed by Purchaser pursuant to Section
5.8 or as required by local law and the Acquired Rights Directive, and any
Liabilities arising out of or in connection with (i) the employment on or after
the Closing Date of the Transferred U.S. Employees and the Transferred Non-U.S.
Employees with Purchaser or its Affiliates; or (ii) any claim by a Transferred
U.S. Employee or a Transferred Non-U.S. Employee in connection with such
Employee’s employment on or after the Closing Date with Purchaser or its
Affiliates (whether in contract or in tort or under statute for any remedy
including for breach of contract, unfair dismissal, redundancy, statutory
redundancy, equal pay, sex, race or disability discrimination, unlawful
deductions from wages or for breach of statutory duty or of any nature); 


7





                    (h)
all accounts and notes payable and Indebtedness of any Seller, whether recorded
or unrecorded, to divisions or Affiliates of Sellers that are Transferred
Entities or other parts of the Business; 


                    (i)
all Liabilities arising under or in respect of the Transferred U.S. Benefit
Plans, the Transferred Foreign Benefit Plans, any of the Labor Contracts, or
the Purchaser’s U.S. Pension Plan, in each case only as expressly provided in Section
5.8; 


                    (j)
all Liabilities related to the possession, occupation, operation, or
maintenance of the real properties subject to the Assumed Real Property Leases,
whether arising or accruing before, on or after the Closing Date, and
whether such Liabilities relate to conditions that existed before, on, or after
the Closing Date; 


                    (k)
(A) all Liabilities arising from any obligation pursuant to Environmental Laws
to investigate and/or remediate Materials of Environmental Concern at, on,
under, or emanating from the Owned Real Property or the Business Leased Real
Property, (B) all Environmental Claims in connection with the Owned Real
Property or the Business Leased Real Property, and (C) all Liabilities under Environmental
Laws relating to the conduct of the Business at the Owned Real Property or the
Business Leased Real Property, including the handling, management, treatment or
disposal on-site of Materials of Environmental Concern or compliance with
Environmental Laws; 


                    (l)
all Liabilities arising out of or relating to any Business Intellectual
Property, including with respect to infringement thereby or misappropriation
relating thereto; 


                    (m)
except as specifically described in Section 1.4, all Liabilities of
Sellers to the extent arising out of or relating to any non-compliance or
alleged non-compliance of the Business with applicable Laws; and 


                    (n)
all Liabilities for Assumed Business Taxes. 


Notwithstanding anything contained in this Agreement to the contrary,
Purchaser does not assume or agree to discharge or perform, and will not be
deemed by virtue of the execution and delivery of this Agreement or any
document delivered at the Closing pursuant to this Agreement, or as a result of
the consummation of the transactions contemplated by this Agreement, to have
assumed, or to have agreed to discharge or perform, any Liability of any
Seller, whether primary or secondary, direct or indirect, other than the
Assumed Liabilities. 


          Section
1.4. Retained Liabilities. The “Retained Liabilities” shall consist of the
following Liabilities of each Seller or Affiliate thereof: 


                    (a)
all Liabilities for Retained Taxes; 


                    (b)
all Liabilities to the extent related to the Retained Assets or any Excluded
Business, including all Liabilities relating to any business of Sellers or
their Affiliates other than the Business; 


8





                    (c)
all Liabilities to the extent related to the Transferred Entities Retained
Assets; 


                    (d)
any Indebtedness of any Seller or any Transferred Entity to any Person other
than a Transferred Entity or a division or Affiliate of Sellers that is part of
the Business or any Liability relating to any interest rate swap agreements,
interest rate cap agreements, interest rate collar agreements, interest rate
insurance agreements, foreign exchange Contracts, currency swap or option
agreements, forward Contracts, commodity swap, purchase or option agreements,
other commodity price hedging arrangements or any other similar Contract
designed to alter the risks arising from fluctuations in interest rates,
currency values or commodity prices of any Seller or Transferred Entity; 


                    (e)
all accounts and notes payable and Indebtedness of any Seller or of any
Transferred Entity, whether recorded or unrecorded, owing to divisions or
Affiliates of Sellers, or any other Person, that are not Transferred Entities
or other transferred portions of the Business; 


                    (f)
except as otherwise expressly provided in Section 5.8, any Liabilities
arising in connection with or relating to any U.S. Benefit Plan or Foreign
Benefit Plan; 


                    (g)
all Liabilities, costs and expenses that relate to or arise from the Honeywell
Filter Litigation or the pending claims or litigation set forth on Schedule
1.4(g); 


                    (h)
the Liabilities set forth on Schedule 1.4(h);


                    (i)
the Retained Environmental Liabilities; 


                    (j)
except as expressly provided otherwise in Section 5.8, (A) any
Liabilities arising out of or in connection with (i) the employment prior to
the Closing Date of the Transferred U.S. Employees and the Transferred Non-U.S.
Employees by the Employee Transferors; or (B) any claim by a Transferred U.S.
Employee or a Transferred Non-U.S. Employee in connection with such Employee’s
employment prior to the Closing Date by the Employee Transferors (whether in contract
or in tort or under statute for any remedy including for breach of contract,
unfair dismissal, redundancy, statutory redundancy, equal pay, sex, race or
disability discrimination, unlawful deductions from wages or for breach of
statutory duty or of any nature); and 


                    (k)
all Liabilities arising out of or relating to any product that is not a
Business Product, including all product return, replacement, rebate, credit and
warranty obligations relating thereto, and all products liabilities relating
thereto. 


          Section
1.5. Liabilities of the Transferred Entities.
The parties agree that none of the Liabilities of the Transferred Entities
shall be assumed by Purchaser pursuant to Section 1.3 and that, except
to the extent specifically referenced in Section 1.4, none of the
Liabilities of the Transferred Entities shall be allocated to Sellers pursuant
to Section 1.4, but that such Liabilities shall be retained by the
respective Transferred Entity in the same manner before and after the Closing
Date without any change therein as a result of the transactions contemplated
hereunder, 


9





except as otherwise set forth herein and except that as of the Closing,
Purchaser, through its ownership of the Equity Interests of the Purchased Entities,
shall be the indirect equity owner of all of the Transferred Entities; provided
that, any Retained Liabilities held by any Transferred Entity shall be assumed
by a Seller or one of its Affiliates (other than any Transferred Entity)
immediately prior to Closing and shall constitute Retained Liabilities for all
purposes of this Agreement. 


          Section
1.6. Purchase Price. The aggregate
purchase price (the “Purchase Price”)
to be paid for the Purchased Assets acquired by Purchaser pursuant to this
Agreement shall consist of cash in the amount of $950,000,000 plus the Net Cash
Adjustment. At the Closing, Purchaser shall (i) deliver to Sellers, pursuant to
wire transfer instructions provided by Honeywell at least two (2) Business Days
prior to the Closing, cash in the amount of $950,000,000, plus the Estimated
Net Cash Adjustment, and (ii) assume the Assumed Liabilities. 


          Section
1.7. [Intentionally omitted] 


          Section
1.8. Purchase Price Adjustment.


                    (a)
Closing of the Books on the Closing Date. In preparation for the
Closing, Honeywell shall cause a full balance sheet closing of the books of the
Business to take place on the Closing Date as if it were the last day of a
fiscal period for the Business. 


                    (b)
Pre-Closing Adjustment. At least five Business Days prior to the Closing
Date, Honeywell shall prepare and deliver to Purchaser a statement (the “Estimated Closing Statement”) consisting of
an estimated calculation in reasonable detail (including all constituent
elements) of the Net Cash Adjustment (the “Estimated
Net Cash Adjustment”). Purchaser shall have the right to object in
good faith to the amounts contained in the Estimated Closing Statement within
two Business Days after the delivery of the Estimated Closing Statement to
Purchaser. Honeywell shall in good faith consider the objections, if any, of
Purchaser to the Estimated Closing Statement and, if Honeywell determines, in
its reasonable discretion, that changes to the Estimated Closing Statement are
appropriate, Honeywell shall re-issue an Estimated Closing Statement containing
the Estimated Net Cash Adjustment no later than one Business Day prior to the
Closing Date. 


                    (c)
Closing Statement. Within ninety (90) days after the Closing Date,
Purchaser shall deliver to Honeywell: 


                              (i)
financial statements for the Business as at the Closing Date and for the period
from the Measuring Time through the Closing Date, together with an unqualified
audit report thereon by Pricewaterhouse Coopers (the “Closing Date Audited Statements”); and 


                              (ii)
a statement (the “Closing Statement”),
which shall be delivered at the same time as the Closing Date Audited
Statements and shall set forth the Purchase Price, including the amount of the
Net Cash Adjustment, determined in accordance with the definitions set forth
herein and based upon the Closing Date Audited Statements and the Applicable
Accounting Principles. The Closing Date Audited Statements and the Closing
Statement shall each be prepared in accordance with the Applicable Accounting
Principles, and shall be


10





accompanied by
reasonable supporting documentation regarding Purchaser’s calculation of the
Net Cash Adjustment. 


                              (iii)
Purchaser shall bear all costs of preparing and delivering the Closing Date
Audited Statements. Purchaser and Honeywell shall each bear fifty percent (50%)
of the cost of Pricewaterhouse Coopers’ review of the Closing Statement to
confirm its compliance with the Applicable Accounting Principles. 


                    (d)
Closing Statement Dispute Notice. Each of Purchaser and Honeywell shall
give the other party and any independent auditors and authorized
representatives of such other party reasonable access during normal business
hours to the properties, books, records and personnel relating to the Business
for purposes of preparing and reviewing the Closing Date Audited Statement and
the Closing Statement and resolving any disputes relating thereto. Honeywell
shall have forty-five (45) days following the delivery by Purchaser of the
Closing Date Audited Statements and the Closing Statement during which to
notify Purchaser in writing of any dispute of any item contained in the Closing
Statement (a “Disputed Item”),
which notice (the “Closing Statement Dispute
Notice”) shall set forth in reasonable detail the basis for such
dispute and provide reasonable supporting documentation, if available, for such
disagreement. If Honeywell fails to notify Purchaser of any such dispute within
such 45-day period, the Closing Statement shall be deemed to be accepted by
Honeywell and the Closing Statement shall be final, binding and conclusive for
all purposes of this Agreement and not subject to any further recourse by
Honeywell or the Sellers under any provision hereof. In the event that
Honeywell shall so notify Purchaser of any dispute, Purchaser and Honeywell
shall cooperate in good faith and use commercially reasonable efforts to resolve
such dispute as promptly as possible. For the avoidance of doubt, it is
expressly agreed that no objection may be raised and no adjustment may be
proposed to any entry or item contained in the Closing Statement except on
grounds that such item or entry has not been calculated in accordance with the
provisions of this Agreement and the definition of Closing Date Adjusted
Purchase Price, including the Net Cash Adjustment, determined in accordance
with the definitions set forth herein. 


                    (e)
Independent Accountant. If Purchaser and Honeywell are unable to resolve
all Disputed Items during the 45-day resolution period, then, at the request of
either party, Purchaser and Honeywell shall jointly engage and submit the
unresolved Disputed Items (the “Unresolved
Items”) to the Independent Accountant; provided that if the
Independent Accountant does not accept such engagement within ten (10) days
after either Purchaser or Honeywell gives notice to the other of such request,
either of them may request the American Arbitration Association to appoint a
substitute Independent Accountant and such appointment shall be final, binding
and conclusive on Purchaser and Honeywell. Purchaser and Honeywell shall use
their reasonable best efforts to cause the Independent Accountant to issue its
written determination regarding the Unresolved Items within thirty (30) days
after such items are submitted for review. The Independent Accountant shall
make a determination with respect to the Unresolved Items only and in a manner
consistent with this Section 1.8 and the Applicable Accounting
Principles. Any adjustment with respect to the Unresolved Items may only be
made by the Independent Accountant within the range between Purchaser’s
calculation and Honeywell’s calculation of the Unresolved Items. Each party
shall use its reasonable best efforts to furnish to the Independent Accountant
such work papers and other documents and information pertaining to the
Unresolved Items as the Independent Accountant may request. The


11





determination of the Independent Accountant and all elements in the
Closing Statement as finalized in such determination, shall be final, binding
and conclusive on Purchaser and Honeywell absent manifest error. The fees,
expenses and costs of the American Arbitration Association and the Independent
Accountant shall be borne in the same proportion as the aggregate amount of the
Unresolved Items that is unsuccessfully disputed by each (as determined by the
Independent Accountant) bears to the total amount of the Unresolved Items
submitted to the Independent Accountant. 


                    (f)
Final Adjustment. If the Net Cash Adjustment in the final Closing
Statement exceeds the Estimated Net Cash Adjustment, then Honeywell shall be
entitled to a payment from Purchaser equal to such excess. If the Estimated Net
Cash Adjustment exceeds the Net Cash Adjustment in the final Closing Statement,
then Purchaser shall be entitled to a payment from Honeywell equal to such
excess. Payments shall be made by wire transfer of immediately available funds
within two Business Days of a party becoming entitled to a payment under this
Section 1.8. To the extent any amount of the Net Cash Adjustment is undisputed,
payment will be made with respect to such undisputed amount as appropriate
within five Business Days of delivery of the Closing Statement or Dispute
Notice, as applicable.  


                    (g)
Method of Payment, Interest, etc. Any amount paid pursuant to Section
1.8 shall be (i) increased by simple interest on such amount at an annual
interest rate equal to 5%, from the Closing Date to and including the date of
payment based on a 365 day year, (ii) made by wire transfer of immediately
available funds to an account designated by the receiving party and (iii)
treated as an adjustment to the Purchase Price for Tax reporting purposes.


          Section
1.9. Withholding. Notwithstanding
any other provision of this Agreement, and for the avoidance of doubt, (a) each
payment made pursuant to this Agreement shall be made net of any Taxes required
by applicable Law to be deducted or withheld from such payment and (b) any
amounts deducted or withheld from any such payment shall be remitted to the
applicable Taxing Authority and shall be treated for all purposes of this
Agreement as having been paid. The party making any such deduction or
withholding shall furnish to the other party official receipts (or copies
thereof) evidencing the payment of any such Taxes. If either Purchaser or any
of the Sellers becomes aware that any amount is required to be so deducted or
withheld, it shall promptly provide notice to the other parties.
Notwithstanding the foregoing, if any amount is deducted or withheld from any
payment made pursuant to this Agreement and Sellers received less than five (5)
days notice prior to the making of such deduction or withholding, then, to the
extent permitted by Law, any such deduction or withholding shall not be
remitted to the applicable Taxing Authority earlier then the date that is five
(5) days after Sellers received notice of such deduction or withholding and
Sellers shall be entitled to raise any objection with respect to such deduction
or withholding during such period. 


ARTICLE II


CLOSING; CLOSING DELIVERIES


          Section
2.1. Closing Date. The closing of
the transactions contemplated by this Agreement (the “Closing”) shall take place at 10:00 a.m.,
local time, at the offices of Debevoise & Plimpton LLP, 919 Third Avenue,
New York, New York 10022 on the third business day after


12





all conditions to the obligations of Purchaser and Sellers under Articles
VI and VII of this Agreement shall have been satisfied or, to the
extent permitted by applicable Law, waived (other than those conditions that by
their terms are to be satisfied by deliveries at Closing, but subject to their
satisfaction or waiver), or at such other place and time as the parties may
agree. The date on which the Closing occurs is referred to herein as the “Closing Date.” 


          Section
2.2. Effectiveness. The
consummation of the transactions contemplated by this Agreement shall be deemed
to take place at 11:59 p.m. local time on the Closing Date (the “Effective Time”). 


          Section
2.3. Closing Deliveries. At the
Closing, 


                    (a)
Sellers shall deliver or cause to be delivered to Purchaser the following (in
each case, in form and substance reasonably acceptable to Purchaser): 


                              (i)
An executed copy of an assignment and assumption agreement providing for the
assumption of Assumed Liabilities by Purchaser (the “Assignment and Assumption Agreement”); 


                              (ii)
Such bills of sale, certificates of title and other instruments of transfer and
conveyance as are reasonably necessary to transfer (or record with any Governmental
Authority the transfer of) the Purchased Assets to Purchaser in accordance
herewith; 


                              (iii)
An executed copy of the Transition Services Agreement; 


                              (iv)
Subject to Section 1.1(e), executed assignment and assumption
agreements, in the form attached hereto as Exhibit A, with respect to
each Assumed Real Property Lease (collectively, the “Real Property Lease Assignments”); 


                              (v)
Executed and acknowledged special warranty or grant deeds, in the form(s)
customarily provided in the applicable jurisdiction, conveying fee simple title
to the Purchased Owned Real Property to Purchaser, subject only to Permitted
Encumbrances (“Deeds”); 


                              (vi)
duly executed state, county and local transfer tax forms with respect to the
Owned Real Property, as applicable; 


                              (vii)
duly executed and acknowledged affidavits as reasonably requested by
Purchaser’s title insurance company in form and substance acceptable to the
applicable Seller or Transferred Entity with respect to the Owned Real Property
in order to issue title insurance policies with respect to the Owned Real
Property with the standard title insurance company issued exceptions omitted
and, if applicable, a non-imputation endorsement; provided, however, that in no
event shall Sellers or their Affiliates be obligated to indemnify the title
insurance company with respect to matters contained in the affidavits; 


                              (viii)
Executed stock transfer agreements, asset transfer agreements and/or other
instruments of conveyance with respect to the transfer of any portion of the


13





Purchased Assets outside the United States (including Equity Interests
in entities organized in jurisdictions outside the United States; it being
understood that such agreements and/or other instruments of conveyance are
intended solely to formalize such foreign transfers in order to comply with any
local Laws pertaining thereto); 


                              (ix)
Certificates representing the Equity Interests in the Purchased Entities, duly
endorsed in blank or accompanied with appropriate stock powers and with all
stock transfer Tax stamps affixed if stock, or duly executed assignments of
such Equity Interests which are not held in the form of stock, or other
documents as may be necessary under applicable Laws to transfer ownership of
such Equity Interests to Purchaser or its specified designees; 


                              (x)
A certificate from each Seller, in form and substance reasonably satisfactory
to Purchaser, establishing that the transfer of the Purchased Assets is exempt
from withholding under Section 1445 of the Code; 


                              (xi)
Resignations of those officers and directors of any Transferred Entity, which
Purchaser shall request in writing before Closing; 


                              (xii)
Required documentation in connection with Transfer Taxes and VAT, if any; and 


                              (xiii)
Organizational books and records of the Transferred Entities. 


                    (b)
Purchaser shall deliver to Sellers the following (in each case, in form and
substance reasonably acceptable to Sellers): 


                              (i)
Executed copies of the Assignment and Assumption Agreement, the Transition
Services Agreement and the Real Property Lease Assignments; 


                              (ii)
Required documentation in connection with Transfer Taxes and VAT, if any; and 


                              (iii)
All such other documents and instruments of assumption as shall be reasonably
necessary for Purchaser to assume the Assumed Liabilities in accordance
herewith. 


          Section
2.4. Allocation of Purchase Price.



                    (a)
The portion of the Purchase Price allocated to the Equity Interests in each of
the Purchased Entities and to the other Purchased Assets of each Seller (net of
Assumed Liabilities) and shall be as set forth on Schedule D. Prior to
the Closing, the parties shall adjust the allocation set forth on Schedule D
to reflect the Net Cash Adjustment in accordance with the Applicable Accounting
Principles. Following Closing, the parties shall further adjust the allocation
set forth on Schedule D to reflect the final Closing Statement. To the
extent permitted by Law, this allocation shall be binding on the parties for
federal, state, local, foreign and other Tax reporting purposes, and no party
will assert or maintain a position inconsistent with this allocation. 


14






                    (b)
The amount set forth on Schedule D for the Purchased Assets (other than
Equity Interests in Purchased Entities) of Honeywell plus those Assumed
Liabilities of Honeywell that constitute liabilities for federal income tax
purposes (the “Gross U.S. Purchase Price”) and shall be allocated among the
Purchased Assets of Honeywell in the manner required by section 1060 of
the Code as shown on an allocation schedule to be prepared by Purchaser as soon
as practicable after the Closing Date. The template of the allocation schedule
is attached hereto as Schedule E. Purchaser shall provide Honeywell with
such allocation schedule and Purchaser shall make such revisions or changes to
such schedule as shall be reasonably requested by Honeywell and approved by
Purchaser, each acting in good faith. In the event Purchaser and Honeywell are
unable to agree on the allocation of the Gross U.S. Purchase Price in such
manner, then each (acting reasonably and in good faith) shall be free to do its
own allocation of the Gross U.S. Purchase Price. In the event Purchaser and
Honeywell do agree on the allocation of the Gross U.S. Purchase Price, then
such allocation shall be binding on them for federal, state, local and other
Tax reporting purposes, including filings on Internal Revenue Service
Form 8594, and neither of them will assert or maintain a position
inconsistent with such allocation.


ARTICLE III


REPRESENTATIONS AND WARRANTIES OF HONEYWELL


          Honeywell
hereby represents and warrants to Purchaser that, except as set forth on the
disclosure schedule delivered by Honeywell to Purchaser concurrently herewith
(the “Disclosure
Schedule”), which Disclosure Schedule shall be arranged in sections
corresponding to the numbered and lettered sections of this Article III,
and any information disclosed in any such section of the Disclosure Schedule
shall be deemed to be disclosed with respect to all sections of this Article
III to which the applicability of such disclosure is reasonably apparent,
and except that all representations of Honeywell in this Article III
(except for the representations in Section 3.3) shall not apply to
Honeywell Portugal:


          Section
3.1. Due
Organization. Each of the Sellers and the Transferred Entities is a
legal entity of the type described in Section 3.1 of the Disclosure
Schedule, duly organized, validly existing and, with respect to entities
organized within the United States and any other jurisdiction outside the
United States in which the concept of good standing or its functional
equivalent is applicable, in good standing or its functional equivalent under
the Laws of the jurisdiction indicated in Section 3.1 of the
Disclosure Schedule. Sellers and the Transferred Entities (a) have all
requisite power and authority under their respective organizational documents
to conduct the Business as it is now being conducted, and (b) are duly
qualified or otherwise authorized to do business in each of the jurisdictions
in which the ownership, operation or leasing of the Purchased Assets or the
assets of any Transferred Entity and the conduct of the Business requires such
entity to be so qualified or otherwise authorized, except to the extent that
the failure to be so qualified or otherwise authorized or in good standing
would not result in material Liability to the Business or materially impair the
ability of any Seller to perform their respective obligations under this
Agreement or to consummate the transactions contemplated hereby. 


15





          Section
3.2. Authority.
Each of the Sellers has the requisite corporate power and authority to execute,
deliver and perform its respective obligations under this Agreement, the
Transition Services Agreement, the Assignment and Assumption Agreement, the
Real Property Lease Assignments, the Deeds and the other documents and
agreements contemplated hereby and thereby to which such Seller is a party
(collectively, the “Transaction Documents”) and to consummate
the transactions contemplated hereby and thereby. The execution, delivery and
performance by each of the Sellers of the Transaction Documents to which such
Seller is a party and the consummation of the transactions contemplated hereby
and thereby have been duly and validly authorized by all necessary action on
the part of the applicable Seller, and no other corporate or other proceedings
on the part of any Seller are necessary to authorize the execution, delivery
and performance by each Seller of this Agreement or to consummate the
transactions contemplated hereby or thereby. This Agreement has been, and upon
their execution the Transaction Documents shall have been, duly executed and
delivered by Sellers, and, assuming due authorization and delivery by
Purchaser, this Agreement constitutes, and upon their execution the Transaction
Documents shall constitute, a valid and binding obligation of Sellers,
enforceable against Sellers in accordance with their respective terms, except
(i) as enforceability may be limited by bankruptcy, insolvency, reorganization,
moratorium and other similar Laws now or hereafter in effect relating to or
affecting creditors’ rights generally or by general equitable principles
(regardless of whether such enforceability is considered in a proceeding in
equity or at law) and (ii) that specific performance may not be available
(collectively, the “Enforceability Exceptions”).


          Section
3.3. Transferred
Entities; Title to Equity Interests. The copies (and, where only a
translation has been provided, the translation) of the organizational documents
of the Transferred Entities, which have been Made Available to Purchaser, are
true, accurate and complete (except in the case of the translations, which are
true, accurate and complete in all material respects). For each Transferred
Entity, Section 3.3 of the Disclosure Schedule sets forth
(i) the nature of the equity interest held by Sellers or, if applicable,
other Transferred Entities, and, if applicable, the par value thereof,
(ii) the holder of such equity interests, (iii) the total number of
such equity interests that are outstanding, and (iv) the percentage of the
outstanding equity interests held by Sellers or other Transferred Entities
(each such equity interest held by a Seller or Transferred Entity, an “Equity
Interest”). The Equity Interests constitute, and on the Closing Date
will constitute, all of the equity of each Transferred Entity held by Sellers
or a Transferred Entity. Except as set forth on Section 3.3 of the
Disclosure Schedule, there are no other equity securities of any Transferred
Entity, and there are no securities convertible into or exchangeable for any
equity securities of any Transferred Entity. Sellers and the Transferred
Entities are not, and prior to the Closing Date will not become, a party to or
subject to any contract or obligation wherein any Person has, or will have, a
right, option or warrant to purchase or acquire any rights in any additional
capital stock or other securities of the Transferred Entities. There are no
stockholder agreements, voting trusts or proxies or other agreements or understandings
in effect with respect to any securities of any Transferred Entity. All Equity
Interests held by Sellers or a Transferred Entity have been duly issued and are
fully paid and non-assessable and not subject to any Encumbrances, except for
Encumbrances arising in connection with this Agreement and those imposed by
Purchaser. None of the issued Equity Interests held by Sellers or a Transferred
Entity was issued in violation of any preemptive rights. Each Seller which
holds an Equity Interest in a Purchased Entity has good title thereto and full 


16





beneficial ownership thereof and upon delivery of such Equity Interest
against payment therefor pursuant to the terms of this Agreement, Purchaser
will receive good title thereto, free and clear of all Encumbrances. There are
no Subsidiaries, joint ventures or other Persons which are material to the
Business in which the Transferred Entities own, of record or beneficially, any
direct or indirect equity or other similar interest or any right (contingent or
otherwise) to acquire any direct or indirect equity or other similar interest. 


          Section
3.4. No
Conflict; Government Authorizations and Third Party Approvals.


                    (a)
Except as provided in Section 5.5(a) with respect to the HSR Act and
required foreign antitrust filings and/or notices and without giving effect to
the provisions of Section 1.1(e), the execution and delivery of this
Agreement and the other Transaction Documents does not, and the consummation of
the transactions contemplated hereby and thereby will not (with or without
notice or lapse of time, or both), conflict with, or result in any violation or
breach of or default under, or give rise to a right of termination,
cancellation or acceleration of any obligation or to loss of a material benefit
under, or result in the creation of any Encumbrance (except for Permitted
Encumbrances) upon any of the Purchased Assets or any assets of any Transferred
Entity under, any provision of (i) any Material Contract or Real Property
Lease or (ii) any organizational documents of any Seller or Transferred
Entity, or (iii) any material Permit, any material Governmental Order or,
subject to the matters described in Section 3.4(b), any Law,
applicable to the Purchased Assets or any Transferred Entity (or any
Transferred Entity’s assets).


                    (b)
Except as provided in Section 5.5(a) with respect to the HSR Act
and required foreign antitrust filings and/or notices and without giving effect
to the provisions of Section 1.1(e), no consent of, or registration,
declaration, notice or filing with, any Governmental Authority, or any third
party under any Material Contract, is required to be obtained or made by any of
the Sellers in connection with the execution, delivery and performance of this
Agreement and the other Transaction Documents or the consummation of the
transactions contemplated hereby and thereby.


          Section
3.5. Financial
Statements.


                    (a)
Sellers have Made Available to Purchaser true and complete copies of the (i)
audited balance sheets and income statements of the Business for the calendar
years ended December 31, 2009 and December 31, 2008 (collectively, the “Year-End
Financial Statements”), (ii) the unaudited historical internal
income statement of the Business for the period from January 1, 2010
through December 31, 2010 (the “Interim Income Statement”) and (iii) the
unaudited historical internal balance sheet of the Business as of December 31,
2010 (the “Interim Balance Sheet” and, together with the Interim Income
Statement, the “Interim Financial Statements”). The Interim Financial
Statements and the Year-End Financial Statements are together referred to as
the “Financial
Statements”.


                    (b)
The Financial Statements were prepared from the books and records of Sellers
and the Transferred Entities. The Financial Statements present fairly, in all
material respects, the financial position and operating results of the Business
as of the dates thereof and for the periods covered thereby, in accordance with
GAAP, consistently applied, subject in the 


17





case of the Interim Financial Statements to year-end adjustments which
are not material in the aggregate.


                    (c)
The internal controls over financial reporting (“Internal Controls”) utilized
by Sellers with respect to the Business are designed to provide reasonable
assurance regarding the reliability of financial reporting and the preparation
of financial statements for Honeywell. To the Knowledge of Honeywell, there are
no material weaknesses or significant deficiencies in the design or operations
of the Internal Controls utilized by Honeywell with respect to the Business.
Honeywell has implemented disclosure controls and procedures designed to ensure
that material information relating to the Business is made known to the
management of the Business by others within the Business.


                    (d)
Sellers have Made Available to Purchaser true and complete copies of all
auditors’ reports, management letters, and internal audit reports related to
the Business during the last three (3) years. 


          Section
3.6. Absence
of Certain Changes; Undisclosed Liabilities.


                    (a)
Except as expressly required by this Agreement and the other Transaction
Documents, from December 31, 2010, (i) Sellers have operated the Business in
the ordinary course of business consistent with past practice in all material
respects, (ii) there has not been a Business Material Adverse Effect, and (iii)
neither any Seller nor any Transferred Entity, in each case only as it relates
to the Business, has taken or agreed to take any action that, if taken or
agreed to after the date hereof without Purchaser’s consent, would be a
violation of Section 5.1.


                    (b)
Other than (i) as and to the extent reflected or reserved for on the Interim
Balance Sheet, or (ii) Liabilities incurred in the ordinary course of business
consistent with past practice since the date of the Interim Balance Sheet,
there are no Liabilities associated with the Business, except for (A)
Liabilities disclosed in the Disclosure Schedule or as to which no disclosure
is required pursuant to any Section of the Disclosure Schedule because the
Liability involves an amount which is less than the specific dollar threshold
above which disclosure on such Section of the Disclosure Schedule is required,
(B) not required to be recorded on the Financial Statements of the Business in
accordance with GAAP, (C) Liabilities under Contracts of the Business,
(D) the Retained Liabilities, and (E) other Liabilities not greater than
$5,000,000 in the aggregate. Notwithstanding the foregoing, the representations
and warranties contained in this Section 3.6(b) are not intended to
limit or expand the scope of any other specific representation or warranty
contained in this Agreement, including the representations contained in Sections
3.7 (Taxes), 3.8 (Intellectual Property), 3.11 (Environmental
Matters), 3.12 (Employee Matters and Benefit Plans), 3.17 (Labor)
and 3.18 (Insurance) and no Liabilities with respect to the subject
matters of such representations shall be a breach of this Section 3.6(b).


          Section
3.7. Taxes.



                    (a)
Sellers have duly and timely filed (or have had filed on their behalf) all Tax
Returns relating to the Business required to be filed by or with respect to
them (taking into account all validly obtained extensions) with the appropriate
Taxing Authority, and the Transferred Entities have duly and timely filed (or
have had filed on their behalf) all Tax Returns 


18





required to be filed by or with respect to them with the appropriate
Taxing Authority. All such Tax Returns are complete, true and correct in all
material respects and all Taxes shown as due on such Returns have been paid.
Sellers have paid or caused to be paid on a timely basis all material Taxes
required to be paid by or with respect to them relating to the Business. The
Transferred Entities have paid or caused to be paid on a timely basis all
material Taxes required to be paid by or with respect to them.


                    (b)
There are no material Encumbrances for Taxes upon any of the Purchased Assets
or any of the assets of the Transferred Entities, except for any Encumbrances
for Taxes not yet due and payable and for which adequate reserves have been
maintained.


                    (c)
There
are no pending or, to the Knowledge of Honeywell, threatened audits,
examinations or other administrative or court proceedings for the assessment,
adjustment or collection of Taxes of Sellers, specifically relating to the
Business, or of the Transferred Entities, and none of the Sellers nor any of
the Transferred Entities has received, within the past five years, any written
notice of any claims, actions, suits, proceedings or investigations for the
assessment, adjustment or collection of Taxes (in the case of the Sellers, to
the extent specifically relating to the Business) that have not been withdrawn,
settled or paid in full.


                    (d)
There
are no outstanding written requests, agreements, consents or waivers to extend
the statutory period of limitations applicable to the assessment or collection
of any Taxes or Tax deficiencies of Sellers, specifically relating to the Business, or of the
Transferred Entities.


                    (e)
Sellers,
with respect to the Business, and the Transferred Entities are in
material compliance with all applicable information reporting and Tax
withholding requirements under U.S. federal, state and local Tax Laws, and
foreign Tax Laws.


                    (f)
No claim has been made by a Taxing Authority in a jurisdiction where a Seller
(with respect to the Business) or a Transferred Entity does not file Tax
Returns of a certain type that it is or may be subject to taxation of such type
by that jurisdiction.


                    (g)
None of the Transferred Entities has participated in a “listed transaction”
within the meaning of Treasury Regulations Section 1.6011-4(c) or any
transaction or arrangement notifiable or reportable under any similar foreign
Tax Law.


                    (h)
None of the Transferred Entities is or has been classified as a passive foreign
investment company, as defined in Section 1297 of the Code.


                    (i)
None of the Transferred Entities has been a “distributing corporation” or a
“controlled corporation” within the meaning of Section 355 of the Code (x) in
the two years prior to the date of this Agreement or (y) in a distribution that
could otherwise constitute a “plan” or “series of related transactions” in
conjunction with the transaction contemplated by this Agreement.


                    (j)
None of the Transferred Entities is, or has been within the past five years, a
United States real property holding corporation within the meaning of Section
897 of the Code.


19





                    (k)
No
Transferred Entity will be required to include any income or gain in any
Post-Closing Tax Period (i) under Section 453 of the Code (or any similar
provision of state, local or foreign Law) in respect of any transaction
occurring on or prior to the Closing Date, (ii) under Section 108(i) of the
Code (or any similar provision of state, local or foreign Law) in respect of
any reacquisition occurring on or prior to the Closing Date, (iii) as a result
of any adjustment under Section 481 of the Code (or any similar provision of
state, local or foreign Law) as a result of the manner in which any item was
reported by any Transferred Entity with respect to any Pre-Closing Tax Period
(other than in respect of a Tax Return prepared by Purchaser).


                    (l)
None of
Sellers, Sellers’ Affiliates or the Transferred Entities has engaged in any
transaction that would result in a limitation or reduction in the Tax basis or
other tax attribute of a Purchased Asset under Treasury Regulations Section
1.338-8 upon consummation of the transactions contemplated by this Agreement.


                    (m)
Section 3.7 of the Disclosure Schedule lists each entity classification
election and change in entity classification that has been made under Treasury
Regulations Section 301.7701-3 with respect to each Transferred Entity for U.S.
federal income Tax purposes.


                    (n)
None of the Purchased Assets to be sold, assigned, transferred, conveyed or
delivered by any Seller (other than a Seller that delivers a statement to
Purchaser, meeting the requirements of Section 1.1445-2(b) of the Treasury Regulations,
to the effect that such Seller is not a “foreign person within the meaning of
Section 1445 of the Code and the Treasury Regulations thereunder.”)
under this Agreement constitute a “United States real property interest” within
the meaning of Section 897 of the Code.


          Section
3.8. Intellectual
Property. 


                    (a)
Sellers and the Transferred Entities own or have rights by a license or
sublicense to use all material Business Intellectual Property, free and clear
of any Encumbrances, other than Permitted Encumbrances. Section 3.8 of
the Disclosure Schedule contains a list of all Registered Intellectual Property
owned by Sellers and the Transferred Entities included in the Business
Intellectual Property. The material Intellectual Property owned by a Seller or
a Transferred Entity and included in the Business Intellectual Property has not
been adjudged invalid or unenforceable, and to the Knowledge of Honeywell, is
valid and subsisting. The conduct of the Business (other than with respect to
the use of (i) the Excluded Intellectual Property, (ii) any Business
Intellectual Property that is licensed to a Seller or a Transferred Entity or
(iii) Patents included in the Purchased Intellectual Property or owned by the
Transferred Entities or any other Intellectual Property included in the
Purchased Intellectual Property or owned by the Transferred Entities that is otherwise
patentable (such other Intellectual Property, the “Patentable Technology”) does
not materially dilute, infringe or otherwise misappropriate the Intellectual
Property of any third Person. To the Knowledge of Honeywell, the use in the
conduct of the Business of Patents included in the Purchased Intellectual Property or owned by the
Transferred Entities or the use of Patentable Technology does not dilute,
infringe or otherwise misappropriate the Intellectual Property of any third
Person. There are no pending, or to the Knowledge of Honeywell, threatened,
actions, suits or proceedings pending against Sellers 


20





or Transferred Entities (A) alleging that the conduct of the Business
(other than with respect to the Excluded Intellectual Property and the Sellers’
Marks) dilutes, infringes or otherwise misappropriates Intellectual Property of
any third Person or (B) opposing or attempting to cancel any rights of the
Sellers or Transferred Entities in any material Business Intellectual Property
owned by a Seller or a Transferred Entity. To the Knowledge of Honeywell, no
third Person is infringing or misappropriating any Business Intellectual
Property owned or exclusively licensed by the Sellers or the Transferred
Entities in any material respect. 


                    (b)
To the Knowledge of Honeywell, the Sellers and Transferred Entities have taken
all commercially reasonable actions to maintain and protect, in all material
respects, the Business Intellectual Property owned by a Seller or a Transferred
Entity. Subject to Section 3.8(b) of the Disclosure Schedule, since
December 31, 2008, all employees and contractors who have developed any
material Purchased Intellectual Property for the Business have executed and
delivered to the Sellers or Transferred Entities a valid and enforceable
agreement providing for (i) the nondisclosure by such employee or contractor of
any confidential information of the Business, and (ii) with respect to any such
contractors, an assignment to a Seller or Transferred Entity with respect to
such contractor’s rights in any material Purchased Intellectual Property.


          Section
3.9. Legal
Proceedings. Except for the Retained Liabilities or as set forth on Section
3.9 of the Disclosure Schedule, there are no actions, suits, or proceedings
pending against or, to the Knowledge of Honeywell, threatened against, any
Seller relating to the Business, any Transferred Entity, any assets of any
Transferred Entity or any of the Purchased Assets by or before any Governmental
Authority which could result in damages in excess of $2,000,000, individually
or in the aggregate, or which seek material equitable relief by or against any
Seller relating to the Business, any Transferred Entity, any assets of any
Transferred Entity or any of the Purchased Assets. Honeywell has no Knowledge
of any investigations with respect to the Business by any Governmental
Authority. Since
December 31, 2008, no Seller (as it relates to the Business), no
Transferred Entity, no asset of any Transferred Entity and none of the
Purchased Assets have been subject to any material Governmental Order, and to
the Knowledge of Honeywell, there are no such material Governmental Orders
threatened to be imposed. Since December 31, 2008, Sellers have not received
any written notice of any investigation with respect to the Business which
could reasonably be expected to result in damages in excess of $2,000,000,
individually or in the aggregate. This representation and warranty does not
apply to environmental matters, which are the subject of Section 3.11,
or Intellectual Property matters, which are the subject of Section 3.8.


          Section
3.10. Compliance
with Laws; Permits. 


                    (a)
Since December 31, 2008, (i) the Business has been conducted in material
compliance with all Laws and Governmental Orders applicable to the Business,
any Seller (as it relates to the Business), any Transferred Entity, any
Employees, any assets of any Transferred Entity or any of the Purchased Assets,
and (ii) no Seller or any Transferred Entity has received any written notice of
any material violation or alleged material violation of any such Law or
Governmental Order.


                    (b)
Without limiting the generality of Section 3.10(a), no Seller,
Transferred Entity or, to the Knowledge of Honeywell, any of their respective
directors, officers, agents, 


21





representatives or employees (in their capacity as directors, officers,
agents, representatives or employees) has, with respect to the Business: (i)
used any funds for unlawful contributions, gifts, entertainment or other
unlawful expenses relating to political activity in respect of the Business;
(ii) directly or indirectly, paid or delivered any fee, commission or other sum
of money or item of property, however characterized, to any finder, agent, or
other party acting on behalf of or under the auspices of a governmental
official or Governmental Authority, in the United States or any other country,
which is in any manner illegal under any Law of the United States or any other
country having jurisdiction; or (iii) made any payment to any customer or
supplier of the Seller or any officer, director, partner, employee or agent of
any such customer or supplier for an unlawful reciprocal practice, or made any
other unlawful payment or given any other unlawful consideration to any such
customer or supplier or any such officer, director, partner, employee or agent,
in respect of the Business.


                    (c)
(i) Sellers and the Transferred Entities have all material Permits that are necessary
to the conduct the Business as presently being conducted, (ii) all such Permits
are in full force and effect, (iii) the Business is not being, and since
December 31, 2008, has not been, conducted in material violation or material
default of such Permits, and (iv) no Seller or any Transferred Entity has
received any written notification from any Governmental Entity, charge, claim
or assertion alleging any violation of any such Permits.


                    (d)
Notwithstanding the foregoing, the representations and warranties contained in
this Section 3.10 do not apply to Intellectual Property,
Environmental Laws, employee benefit plans and real estate, which subject
matters are covered in Sections 3.8, 3.11, 3.12 and 3.14,
respectively.


          Section
3.11. Environmental
Matters. (a) Sellers, in connection with the
Business, and the Transferred Entities are, and since December 31, 2008 have
been, in compliance with applicable Environmental Laws and have obtained and
been in compliance with all Environmental Permits that specifically relate to
the Business, any asset of any Transferred Entity or any Purchased Asset, (b)
there is no Environmental Claim pending or, to the Knowledge of Honeywell,
threatened against any Seller or Transferred Entity that specifically relates
to the Business, any asset of any Transferred Entity or any Purchased Asset,
(c) there is no condition on any Owned Real Property or Business Leased Real
Property for which any Seller or Transferred Entity has an obligation to undertake
any Remedial Action pursuant to Environmental Laws, (d) there are no Materials
of Environmental Concern present on, in, under or migrating from or to any
Owned Real Property or Business Leased Real Property, except as may be present
at or used at any Owned Real Property or Business Leased Real Property in the
ordinary course of business (including any building materials or equipment that
may contain Materials of Environmental Concern) and in compliance with
applicable Environmental Laws, and no Release of Materials of Environmental
Concern has occurred from, on, in or under any Owned Real Property, or any
Business Leased Real Property during the lease of such real property, except as
permitted by Environmental Laws, and (e) no Transferred Entity is conducting
any Remedial Action relating to any Release or threatened Release, and no
Seller is conducting any Remedial Action relating to any Release or threatened
Release, at any Owned Real Property or any Business Leased Real Property, or
otherwise specifically relating to the operations of the Business, in each
case, either voluntarily or pursuant to the order of any 


22





Governmental Authority or the requirements of any Environmental Law or
Environmental Permit.


          Section
3.12. Employee
Matters and Benefit Plans.


                    (a)
Each material employment, deferred compensation, stock option, stock purchase,
stock appreciation right, equity-based compensation, incentive, bonus, tuition
reimbursement, pension, savings, profit-sharing, retirement, medical, vacation,
retiree medical, dental, life, disability, death benefit, group insurance,
severance pay plan, other material compensatory plan, policy or agreement
(including any severance, retention, change in control or similar agreement) or
material fringe benefit plan or arrangement (including any “employee benefit
plan” within the meaning of Section 3(3) of ERISA) that is maintained or
sponsored by a Seller or a Transferred Entity and that covers any Employee in
the United States Business, other than statutory plans, has been listed on Section 3.12(a)
of the Disclosure Schedule (each a “U.S. Benefit Plan” and collectively, the “U.S. Benefit
Plans”). Sellers have delivered or made available to Purchaser a
current, accurate and complete copy (or, to the extent no such copy exists, an
accurate written description) of each U.S. Benefit Plan and, to the extent
applicable, the Plan’s most recent IRS determination letter and current summary
plan description, if any. Each U.S. Benefit Plan which is intended to qualify
under Code Section 401(a) has been determined to be so qualified by the
Internal Revenue Service and to the Knowledge of Honeywell nothing has occurred
as to each which has resulted or is likely to result in the revocation of such
qualification or which requires or could require action under the compliance
resolution programs of the Internal Revenue Service to preserve such
qualification.


                    (b)
Each material employment, deferred compensation, stock option, stock purchase,
stock appreciation right, equity-based compensation, incentive, bonus, tuition
reimbursement, pension, savings, profit-sharing, retirement, medical, vacation,
retiree medical, dental, life, disability, death benefit, group insurance,
severance pay plan, other material compensatory plan, policy or agreement
(including any severance, retention, change in control or similar agreement) or
material fringe benefit plan or arrangement that is maintained or sponsored by
a Seller or a Transferred Entity and that covers any Employee employed in the
Non-United States Business, other than statutory plans, has been listed on Section 3.12(b)
of the Disclosure Schedule (each a “Foreign Benefit Plan” and collectively, the
“Foreign
Benefit Plans”). Sellers have delivered or made available to
Purchaser a current, accurate and complete copy (or, to the extent no such copy
exists, an accurate written description) of each Foreign Benefit Plan and, to
the extent applicable, the Plan’s current summary plan description, if any.
Each Foreign Benefit Plan (i) if intended to qualify for special tax treatment,
meets all requirements for such treatment; (ii) is fully funded and has been
fully accrued for on the Financial Statements; and (iii) if required to be
registered, has been registered with the appropriate authorities and has been
maintained in good standing with the appropriate regulatory authorities.


                    (c)
No Seller or Transferred Entity has announced its intention, or undertaken
(whether or not legally bound) to modify or terminate any U.S. Benefit Plan or
Foreign Benefit Plan or adopt any arrangement or program which, once
established, would come within the definition of a U.S. Benefit Plan or Foreign
Benefit Plan. Neither Honeywell nor any ERISA Affiliate has incurred any
Liability which remains outstanding: (i) under Code Section 412 or Title
IV of ERISA with respect to any “single employer plan” (as defined in ERISA 


23





Section 4001(a)(15), or (ii) under Title IV of ERISA with respect
to any “multiemployer plan” (as defined in Section 3(37) or
Section 4001(a)(3) of ERISA)).


                    (d)
None of the Transferred Entities nor any ERISA Affiliate of a Transferred
Entity maintains or contributes to (A) any “single employer plan” or
“multiemployer plan” (each as defined in the preceding paragraph) that is
subject to Code Section 412 or Title IV of ERISA, (B) any “multiple employer
welfare arrangement” as defined in Section 3(40)(A) of ERISA, (C) any
“multiple employer plan” as described in ERISA Section 210, or (D) any
“voluntary employees beneficiary association” within the meaning of
section 501(c)(9) of the Code or any other “welfare benefit fund” as
defined in section 419(e) of the Code. With respect to any U.S. Benefit
Plan set forth on Section 3.12(d) of the Disclosure Schedule which
is a “single employer plan” (as defined above) subject to Title IV of ERISA, no
reportable event within the meaning of Section 4043 of ERISA, or event or
condition which presents a material risk of termination by the Pension Benefit
Guaranty Corporation, has occurred. 


                    (e)
No Transferred Entity has incurred any Liability to provide health (including
medical, dental or vision care) or life insurance benefits or coverage under
any U.S. Benefit Plan for any participant or any beneficiary of a participant
after such participant’s termination of employment, except as may be required
by Section 4980B of the Code or Section 601 (et seq.) of ERISA (“COBRA”)
or under any applicable Law or National Laws (such benefits and coverages, “OPEB
Benefits”). To the Knowledge of Honeywell, no U.S. Benefit Plan nor
any person who is a party in interest in respect of a U.S. Benefit Plan within
the meaning of Section 3(14) of ERISA, has engaged in a prohibited transaction
which could subject any Transferred Entity directly or indirectly to liability
under Section 409 or 502(i) of ERISA or Section 4975 of the Code.


                    (f)
Each U.S. Benefit Plan and Foreign Benefit Plan complies and has complied in
all material respects with any applicable Law governing such U.S. Benefit Plan
or Foreign Benefit Plan (whether as a matter of substantive law or as necessary
to secure favorable tax treatment), including ERISA and the Code, and is and
has been maintained in all material respects in accordance with its terms and
the terms of any applicable collective bargaining agreement to the extent
consistent with all such requirements of Law. With respect to each U.S. Benefit
Plan and Foreign Benefit Plan for which a separate fund of assets is or is
required to be maintained, full and timely payment has been made of all amounts
required of the Sellers and the Transferred Entities, under the terms of each
such Plan or applicable Law (determined without regard to any waiver of legally
applicable funding requirements), as applied through the Closing Date. There
are no pending or threatened legal actions, proceedings or investigations,
other than routine claims for benefits, concerning any U.S. Benefit Plan or
Foreign Benefit Plan or, to the Knowledge of Honeywell, any fiduciary or
service provider thereof in respect of such U.S. Benefit Plan or Foreign
Benefit Plan, which could be expected to give rise to any Liability on the part
of any Transferred Entity. Neither any Seller nor any Transferred Entity has
any material liability, nor has taken any action that could give rise to such
material liability, under any U.S. Benefit Plan or Foreign Benefit Plan,
arising out of the treatment of any service provider as a consultant or
independent contractor and not as an employee (or vice versa).


                    (g)
Except as set forth in Section 3.12(g) of the Disclosure Schedule, there
are no providers of subcontracted employees to the Business.


24






                    (h)
This Section 3.12 contains the exclusive representations and warranties
of Sellers with respect to the U.S. Benefit Plans and the Foreign Benefit
Plans.


          Section
3.13. Contracts.



                    (a)
Except as set forth in Section 3.13 of the Disclosure Schedule, as of
the date hereof, there are no Contracts included in the Purchased Assets (i)
that limit or purport to limit the ability of a Seller or Transferred Entity to
compete in any line of business or with any Person, industry or geographical
area or during any period of time; (ii) which expressly create a partnership or
joint venture or similar arrangement; (iii) for the sale or exclusive license
of any material assets of the Business other than Business Inventory or
Business Products or for the furnishing of services by a Seller or Transferred
Entity other than in the ordinary course of business consistent with past
practice; (iv) for the acquisition of any Person or any business unit thereof
or the disposition of any material assets of the Transferred Entities other
than in the ordinary course of business consistent with past practice, in each
case, involving payments in excess of $20,000,000, other than Contracts in
which the applicable acquisition or disposition has been consummated and there
are no material obligations of a Seller or a Transferred Entity ongoing; (v)
which is a collective bargaining agreement, employee association agreement or
other agreement with any labor union, employee representative group, works
council or similar collection of employees, other than Labor Contracts; (vi)
between or among a Seller or Transferred Entity, on the one hand, and one or
more Affiliates of a Seller (other than another Seller or Transferred Entity),
on the other hand; (vii) under which the Business has made payments in excess
of $2,000,000 in the last fiscal year or anticipate making payments in excess
of $2,000,000 in the current fiscal year (other than purchase orders or
invoices entered into in the ordinary course of business and ordinary course
trade payables and trade receivables negotiated on an arms’ length basis);
(viii) requiring capital expenditures after the date of this Agreement in an
amount in excess of $5,000,000 in any calendar year; (ix) that involve the
sale, development, use or license of any Business Intellectual Property
material to the Business other than non-exclusive licenses and confidentiality
agreements entered into in the ordinary course of business and licenses for
commercially available off-the shelf Software; (x) under which the Business
received payments in excess of $5,000,000 in the last fiscal year or
anticipates receiving payments in excess of $5,000,000 in the current fiscal
year (other than sales orders or invoices entered into in the ordinary course
of business); (xi) requiring any Seller (with respect to the Business) or any
Transferred Entity to make a minimum payment for or purchase a minimum quantity
of goods and services from third party suppliers irrespective of usage, or
requiring any Seller (with respect to the Business) or any Transferred Entity
to offer to any customer (with respect to any Business Product or services) the
lowest price and/or best terms offered to any other customer for such Business
Product or service, except for Contracts under this clause (xi) which require
payments by or to the Business of less than $1,000,000 per annum; (xii)
relating to Indebtedness, including notes, debentures, any other evidence of
Indebtedness, guarantees, loans, credit or financing agreements or instruments
or other Contracts for borrowed money, including any agreement or commitment
for future loans, credit or financing, and any Contract relating to interest
rate or commodity swaps, interest rate caps, interest rate collar, or interest
rate insurance arrangements, involving derivative, swap, foreign exchange
option or similar commodity price hedging arrangements, or that are otherwise
similarly designed to alter the risks arising from fluctuations in interest
rates, currency values or commodity prices of any Seller or Transferred Entity;
(xiii) that constitute capital leases; (xiv) that constitute any agency, sales
representative,


25





distribution or similar Contract, or (xv) involving any Key Customers
or Key Suppliers, other than purchase orders, sales orders and confidentiality
agreements in the ordinary course of business. Each such Contract described in
the foregoing clauses (i)-(xv) is referred to herein as a “Material Contract.” 


                    (b)
(i) each Seller or Transferred Entity is not, in any material respects, in
breach of or default under any Material Contract to which such Seller or
Transferred Entity is a party, and, to the Knowledge of Honeywell, no other
party to any such Contract is in material breach thereof or material default
thereunder, (ii) no Seller or Transferred Entity has received any written
notice or claim of material default under any Material Contract and (iii) to
the Knowledge of Honeywell, no event has occurred that, with or without notice
or lapse of time or both, would result in a material breach or material default
under any Material Contract by a Seller or a Transferred Entity. Sellers have
Made Available to Purchaser true and complete copies of each Material Contract,
including all material amendments, modifications, supplements, exhibits,
schedules, addenda and restatements thereto and thereof. Sellers have not
posted any surety bond or letter of credit with respect to the Business.
Notwithstanding the foregoing, the representations and warranties contained in
this Section 3.13 do not apply to the Real Property Leases, which
are covered exclusively in Section 3.14.


                    (c)
Each Material Contract is valid and binding on the applicable Seller and/or
Transferred Entity and, to the Knowledge of Honeywell, on the other parties
thereto, subject to the Enforceability Exceptions.


          Section
3.14. Real
Properties. 


                    (a)
Section 3.14(a) of the Disclosure Schedule identifies all Owned Real
Property that is used or held for use in connection with the operation of the
Business and identifies the location and record owner thereof. Section
3.14(a) of the Disclosure Schedule identifies all real property that is
leased, subleased or used under a license or occupancy agreement by Sellers or
the Transferred Entities (whether as landlord or tenant) in connection with the
operation of the Business. Prior to the date hereof, Sellers have provided
Purchaser with true and complete copies of all Real Property Leases.


                    (b)
With respect to each Real Property Lease, (i) such lease is in full force and
effect and, to the Knowledge of Honeywell, is enforceable against each party
thereto, (ii) neither the Seller, the applicable Transferred Entity, nor, to
the Knowledge of Honeywell, the landlord under such lease, is in monetary or
other material default thereunder, and (iii) to the Knowledge of Honeywell, no
condition exists which with notice or lapse of time or both would constitute a
monetary or other material default by any Seller or Transferred Entity under
such lease.


                    (c) A Seller, ASAC or a Transferred Entity, as
applicable, holds fee title to each parcel of Owned Real Property and, with
respect to the applicable Owned Real Property parcel (i) has good, valid,
insurable and marketable fee simple title to such Owned Real Property, free and
clear of any Encumbrance, other than Permitted Encumbrances and (ii) there are
no outstanding options or rights of first refusal to purchase such Owned Real
Property or any portion thereof or interest therein. No Seller or Transferred
Entity is a lessor, sublessor or grantor under any lease, sublease or other
instrument granting to any Person the right to the 


26





possession, use or occupancy of any Owned Real Property or any Business
Leased Real Property. To the Knowledge of Honeywell, (i) the Business has good
and valid rights of ingress and egress to and from the buildings, structures
and improvements (together, the “Structures”) located on the Owned Real
Property and the Business Leased Real Property and to the public street systems
for all usual street, road and utility purposes, (ii) the Structures have
adequate access to all water, sewer, gas, electric, telephone and drainage
facilities, and all other utilities required by any applicable Law sufficient
for the current use and operation thereof and (iii) the Sellers’ or Transferred Entities’ ownership,
occupancy, use and operation of the Owned Real Property and the Structures
located thereon do not violate, in any material respect, any applicable deed
restrictions or other covenants, restrictions, existing site plan approvals,
zoning or subdivision regulations or urban development plans applicable to the
Owned Real Property and such Structures. The Structures are in good
operating condition for the use to which such Structure is currently intended
by the Business, ordinary wear and tear excepted, and none of the Owned Real Property or the Business
Leased Real Property has suffered any material damage by fire or other casualty
which has not been repaired and restored in all material respects prior to the
date hereof except as otherwise disclosed in the Disclosure Schedule. To
the Knowledge of Honeywell, neither Honeywell, nor any Seller or applicable
Transferred Entity has received written notice of any current or, to the
Knowledge of Honeywell, threatened, regulatory proceedings, administrative
actions, condemnation, appropriation, eminent domain or similar proceedings
relating to any portion of the Owned Real Property or the Business Leased Real
Property. 


          Section
3.15. Business
Personal Property and Business Inventory; Transfer of Title to Purchased Assets.
A Seller or a Transferred Entity, as the case may be, has good, valid and
exclusive title to, or a valid leasehold interest in, all material Business
Personal Property and material Business Inventory, in all cases free and clear
of any Encumbrances other than Permitted Encumbrances. All Business Personal
Property is in good working condition, ordinary wear and tear excepted. At the
Closing, Sellers and their Affiliates (other than the Transferred Entities)
shall convey all of their respective title to the Purchased Assets (other than
the Equity Interests which are otherwise addressed in Section 3.3) free
and clear of any Encumbrances, other than Permitted Encumbrances.


          Section
3.16. Sufficiency
of Assets. Except for the assets and services to be made available
pursuant to the Transition Services Agreement, the Retained Interests, and the
assets and services set forth on Section 3.16 of the Disclosure
Schedule, the Purchased Assets and the assets of the Transferred Entities
(excluding all Transferred Entities Retained Assets) in all material respects
constitute all the assets necessary for the continued conduct of the Business
as currently conducted. 


          Section
3.17. Labor.



                    (a)
Set forth in Section 3.17(a) of the Disclosure Schedule is a true and
complete list of the Labor Contracts (in the case of the Labor Contracts
described in Section 5.8(c)(i)(D), to the Knowledge of Honeywell).
Except for the Labor Contracts, to the Knowledge of Honeywell, there are no
collective bargaining agreements or any other labor-related agreements with any
labor union or labor organization applicable to employees of the Business nor
is any such agreement currently being negotiated.


27





                    (b)
No material work stoppage involving the Business is pending or, to the
Knowledge of Honeywell, threatened by, any material labor dispute. No part of
the Business is (nor has been during the preceding 2 years) subject to any
current, pending, or threatened union organizing effort and/or unfair labor
practice complaint. 


                    (c)
With respect to this transaction, any notice that the Sellers are required to
give under any labor law or any collective bargaining agreement (including any
work council) has been or will be given in a timely manner and all bargaining
obligations with any employee(s) or any employee representative(s) have been or
prior to Closing will be satisfied.


          Section
3.18. Insurance.
Section 3.18 of the Disclosure Schedule sets forth a list of all current
material insurance policies carried by or for the benefit of Sellers relating
to or covering the Business and/or the Purchased Assets or assets of the
Transferred Entities as of the date hereof (collectively the “Insurance Policies”). All Insurance
Policies are in full force and effect and all premiums due thereunder have been
paid and the limits thereunder have not been exhausted or materially
diminished. To the Knowledge of Honeywell, the applicable insured parties have
complied in all respects with the provisions of such Insurance Policies. Since
December 31, 2009, neither any Seller, any Transferred Entity nor their
respective Subsidiaries has received: (a) any written notice regarding the
cancellation or invalidation of any of the existing Insurance Policies or
regarding any actual or possible adjustment in the amount of the premiums or
deductibles payable with respect to any such policies; or (b) any written
notice regarding any refusal of coverage under, or any rejection of any claim
under, any such policies or any attempt to reduce or otherwise limit coverage
under such policies. 


          Section
3.19. Finder’s
Fee. Other than the fees to be paid by Sellers to Goldman, Sachs
& Co., Sellers and the Transferred Entities have not incurred any liability
to any party for any brokerage or finder’s fee or agent’s commission, or the
like, in connection with the transactions contemplated by this Agreement or the
Transaction Documents.


          Section
3.20. Affiliate
Transactions. 


                    (a)
Section 3.20(a) of the Disclosure Schedule sets forth all Contracts or
other transactions involving the sale of goods relating to the Business having
current force or effect, in each case between (i) Sellers and their Affiliates
(other than the Transferred Entities), on the one hand, and the Transferred
Entities, on the other, and (ii) between the Business on the one hand and
Honeywell and its Affiliates (other than the Transferred Entities) on the other
hand (any such transaction, a “Related Party Transaction”). 


                    (b)
Section 3.20(b) of the Disclosure Schedule lists any transfers of personnel
in “Band 4” or higher between the Business and other lines of business
conducted by Sellers or any of their Affiliates since January 1, 2010. 


          Section
3.21. Warranties.
Set forth in Section 3.21 of the Disclosure Schedule is a true and correct
copy of the terms of the standard warranties provided by Sellers or the
Transferred Entities with respect to Business Products sold in connection with
the Business as of the date hereof. There are no claims pending or, to
Honeywell’s Knowledge, threatened against any 


28





Seller or Transferred Entity with respect to the quality of or absence
of defects in such Products or services that would be expected to result in a
material Liability to the Business. 


          Section
3.22. Customers
and Suppliers. Section 3.22 of the Disclosure Schedule sets
forth a true and complete list of (a) the top 15 customers of the Business (by
revenue) during the 2009 and 2010 fiscal years (the “Key Customers”), and (b) the
top 10 suppliers of the Business during the 2009 and 2010 fiscal years (the “Key
Suppliers”). Since December 31, 2008, no Key Customer or Key
Supplier has canceled or otherwise terminated its relationship with the
Business, and the Business has not received any written notice from any Key
Customer or Key Supplier to the effect that any such Key Customer or Key
Supplier intends to terminate or materially adversely modify its relationship
with the Business. 


          Section
3.23. Disclaimer
of Other Representations and Warranties. Except as expressly set
forth in this Article III and the Disclosure Schedule, Honeywell
and Sellers do not make any representation or warranty, express or implied, at
law or in equity, with respect to the Business or the past, present or future
condition of any of its assets, Liabilities or operations, or the past, current
or future profitability or performance, individually or in the aggregate, of
the Business or any other matter, and Honeywell and each Seller specifically
disclaims any such other representations or warranties.


ARTICLE IV


REPRESENTATIONS AND WARRANTIES OF PURCHASER
AND RANK GROUP


          Purchaser
and Rank Group hereby represent and warrant, jointly and severally to Sellers
that, except as set forth on the disclosure schedule delivered by Purchaser to
Honeywell concurrently herewith (the “Purchaser Disclosure Schedule”), which
Purchaser Disclosure Schedule shall be arranged in sections corresponding to
the numbered and lettered sections of this Article IV, and any
information disclosed in any such section of the Purchaser Disclosure Schedule
shall be deemed to be disclosed only for purposes of the corresponding section
of this Article IV, unless it is reasonably apparent on the face of
the disclosure contained in such section of the Purchaser Disclosure Schedule
that such disclosure is applicable to another section of this Article IV:


          Section
4.1. Corporate
Status. Purchaser is a New Zealand company, duly organized and
validly existing under the Laws of the jurisdiction of its incorporation or
organization. Rank Group is a New Zealand company, duly organized and validly
existing under the Laws of the jurisdiction of its organization. Each of
Purchaser and Rank Group (a) has all requisite power and authority to
carry on its business as it is now being conducted, and (b) is duly qualified
or otherwise authorized to do business and is in good standing as a foreign
corporation in each of the jurisdictions in which the ownership, operation or
leasing of its properties and assets and the conduct of its business requires
it to be so qualified or otherwise authorized, except where the failure to be
so qualified or otherwise authorized would not have a Purchaser Material
Adverse Effect. 


          Section
4.2. Authority.
Each of Purchaser and Rank Group has all requisite corporate or entity power
and authority to execute, deliver and perform its obligations under this 


29





Agreement and any Transaction Documents to which Purchaser or Rank
Group is a party and to consummate the transactions contemplated hereby and
thereby. The execution, delivery and performance by Purchaser and Rank Group of
this Agreement and the Transaction Documents to which such Purchaser or Rank
Group is a party and the consummation of the transactions contemplated hereby
and thereby, have been duly and validly authorized by all necessary corporate
or entity action on the part of Purchaser or Rank Group, as applicable, and no
other corporate or other proceeding on the part of Purchaser or Rank Group, as
applicable, is necessary to authorize the execution, delivery and performance
by Purchaser or Rank Group of this Agreement and the Transaction Documents or
to consummate the transactions contemplated hereby and thereby. This Agreement
has been, and upon their execution each of the Transaction Documents shall have
been, duly executed and delivered by Purchaser and Rank Group, and, assuming
due authorization and delivery by Sellers, this Agreement constitutes, and upon
their execution each of the Transaction Documents shall constitute, a valid and
binding obligation of each of Purchaser and Rank Group, enforceable against
Purchaser and Rank Group in accordance with their terms, subject to the
Enforceability Exceptions. 


          Section
4.3. No
Conflict; Required Filings.


                    (a)
Except as provided in Section 5.5(a) with respect to the HSR Act,
required foreign antitrust filings and/or notices and required foreign
investment filings specified on Schedule 4.3(a), the execution and
delivery of this Agreement and the Transaction Documents do not, and the
consummation of the transactions contemplated hereby and thereby will not (with
or without notice or lapse of time, or both), conflict with, or result in any
violation of or default under, or give rise to a right of termination, cancellation
or acceleration of any obligation or to loss of a benefit under, or result in
the creation of any Encumbrance upon any of the properties or assets of
Purchaser under, any provision of (i) the certificate of incorporation, by-laws
or other organizational or governing documents of Purchaser, its Subsidiaries
or Rank Group, (ii) any material Contract to which Purchaser, any of its
Subsidiaries or Rank Group is a party or (iii) any Governmental Order, material
permit or, subject to the matters described in Section 4.3(b), Law
applicable to Purchaser, its Subsidiaries or Rank Group or their respective
property or assets.


                    (b)
Except as provided in Section 5.5(a) with respect to the HSR Act
and required foreign antitrust filings and/or notices, no material consent of,
or registration, declaration, notice or filing with, any Governmental Authority
or third party under any material Contract to which Purchaser or Rank Group is
a party is required to be obtained or made by Purchaser or Rank Group in
connection with the execution, delivery and performance of this Agreement, the
Transaction Documents or the consummation of the transactions contemplated
hereby and thereby.


          Section
4.4. Finder’s
Fee. Except for fees payable to Nomura Securities North America LLC,
for which Purchaser will be exclusively responsible, Purchaser has not incurred
any liability to any party for any brokerage or finder’s fee or agent’s
commission, or the like, in connection with the transactions contemplated by this
Agreement or the Transaction Documents.


          Section
4.5. Solvency.
Assuming (a) the satisfaction of the conditions to Purchaser’s obligations to
consummate the transactions contemplated by this Agreement (without giving
effect to any waivers by Purchaser) and (b) the accuracy of the representations
and warranties of 


30





Honeywell in this Agreement as of the Closing Date and compliance by
Sellers in all material respects with the covenants contained in this
Agreement, immediately following the Closing after giving effect to the
transactions contemplated hereby, Purchaser will be Solvent. As used herein, “Solvent”
means with respect to the Purchaser (i) the fair value of the property of
Purchaser will be greater than the total amount of their liabilities,
including, contingent liabilities, (ii) the present fair saleable value of the
assets of Purchaser will not be less than the amount that will be required to
pay the probable liability on their debts as they become absolute and matured,
(iii) Purchaser will be able to pay their debts and liabilities as such debts
and liabilities becomes absolute and matured, and (iv) Purchaser will not be
engaged in business or a transaction, and will not be about to engage in
business or a transaction, for which their property would constitute an
unreasonably small capital. The amount of contingent liabilities at any time
shall be computed as the amount that, in the light of all the facts and
circumstances existing at such time, represents the amount that can reasonably
be expected to become an actual or matured liability.


          Section
4.6. Financing.
The funding to be provided by Rank Group to Purchaser is as of the date hereof,
and will be as of the Closing Date (together with any other funds available to
Purchaser), sufficient to enable Purchaser to consummate the transactions
contemplated by this Agreement, the Transaction Documents and deliver the
Purchase Price at Closing. Notwithstanding anything to the contrary contained
herein, the parties acknowledge and agree that it shall not be a condition to
the obligations of Purchaser to consummate the transactions contemplated hereby
that Purchaser has sufficient funds for payment of the Purchase Price. 


          Section
4.7. No
Reliance. 


                    (a)
Purchaser is an informed and sophisticated purchaser and has engaged expert
advisors who are experienced in the evaluation and purchase of businesses such
as the Business (including the Purchased Assets) as contemplated hereunder, and
has had such access to the personnel and properties of the Sellers as it deems
necessary and appropriate to make such evaluation and purchase.


                    (b)
Purchaser has agreed to purchase the Purchased Assets and assume the Assumed
Liabilities based on its own inspection, examination and determination with
respect to all matters and without reliance upon any representations,
warranties, communications or disclosures of any nature other than those
expressly set forth in this Agreement.


                    (c)
Purchaser does not have any special relationship with any Seller, or any
employee, officer, director, agent, advisor, representative or Affiliate of any
Seller, that would justify any expectation beyond that of any ordinary buyer
and any ordinary seller in an arms’ length transaction and Purchaser is not
owed any duty or entitled to any remedies not expressly set forth in this
Agreement. 


                    (d)
Without limiting the generality of the foregoing, Purchaser, in entering into
this Agreement, acknowledges and agrees that, Purchaser is relying solely on
the representations and warranties of the Sellers set forth in Article III
of this Agreement, and except as set forth in such representations and
warranties (as qualified or otherwise modified by the disclosure in the
Disclosure Schedules), neither the Sellers nor any of their agents, advisors, 


31





employees or representatives makes any representation or warranty,
express or implied, with respect to, and Purchaser expressly disclaims any
reliance on, (A) any information included in information packages
delivered to Purchaser related to the Business (including the Purchased Assets)
or other matters; (B) any information, written or oral and in any form
provided, Made Available to Purchaser or any of its agents, advisors, employees
or representatives; (C) any projections, estimates or budgets delivered to
or Made Available to Purchaser or any of its agents, advisors, employees or
representatives, or which is Made Available to Purchaser or any of its agents,
advisors, employees or representatives after the date hereof, or future
revenues, expenses or expenditures, future results of operations (or any
component thereof), future cash flows or future financial condition (or any
component thereof) of the Sellers or the Purchased Assets or the future
business and operations of the Sellers or the Purchased Assets; (D) the
condition of any of the Purchased Assets being transferred hereunder, which
Purchaser is purchasing on an “AS IS, WITH ALL FAULTS” basis without any warranties
or guarantees of any kind from the Sellers; (E) the operation of the
Business by Purchaser after Closing in any manner; (F) the probable
success or profitability of the ownership, use or operation of the Business
(including the Purchased Assets) by Purchaser after the Closing; or
(G) the accuracy or completeness of any other information, written or oral
and in any form provided, or documents previously Made Available or which is
made available after the date hereof to Purchaser or any of its agents,
advisors, employees or representatives with respect to the Sellers, the
Purchased Assets or their respective businesses and operations or other related
matters, whether in expectation of the transactions contemplated by this
Agreement or otherwise. 


                    (e)
Disclaimer of Other Representations and
Warranties. Except as expressly set forth in this Article IV,
Purchaser does not make any representation or warranty, express or implied, at
law or in equity, with respect to Purchaser, its Affiliates, its businesses or
financial condition or any of its assets, liabilities or operations or any
other matter, and any such other representations or warranties are hereby
expressly disclaimed. 


ARTICLE V


CERTAIN COVENANTS


          Section
5.1. Conduct
of the Business. During the period from the date hereof until the
Closing or earlier termination of this Agreement, except (a) as otherwise
expressly contemplated by this Agreement, (b) as consented to in writing
by Purchaser, which consent shall not be unreasonably withheld, conditioned or
delayed, provided that failure by Purchaser to respond in any manner to
a request for consent in writing from Sellers within five (5) Business Days of
receipt of such written request shall be deemed to constitute consent by
Purchaser to the items set forth in such request for purposes of this Section
5.1 only, and (c) as set forth in Schedule 5.1, Sellers shall
not and shall cause the Transferred Entities not to and not to commit to:


                    (a)
fail to conduct the Business and utilize the Purchased Assets in all material
respects in the ordinary course of business, consistent with past practices;


                    (b)
fail to use their commercially reasonable efforts, consistent with past
practices, to maintain the Business intact, to retain its Employees, and to
preserve the good 


32





relations of the suppliers, customers and others with whom the Business
has business relations (it being agreed that nothing herein shall prohibit
Sellers or the Transferred Entities from involuntarily terminating the
employment of any employee with a salary band designation below “Band 4” if a
Seller or Transferred Entity deems it appropriate under the circumstances to do
so);


                    (c)
change the material terms and conditions of their relationships with Key
Customers or Key Suppliers other than in the ordinary course of business;


                    (d)
change any payment or collection practices with respect to payables or
receivables of the Business other than in the ordinary course of business
consistent with past practice;


                    (e)
issue, sell, transfer, pledge, dispose of or encumber the Equity Interests, or
grant any option, warrant or other right to purchase or obtain, or otherwise
dispose of or encumber any of the Equity Interests;


                    (f)
(i) make or grant any general or special wage or salary increase (other than
standard merit increases consistent with past practice within the past three
years), (ii) make any increase in the payments of benefits under any bonus,
incentive, insurance, deferred compensation, profit sharing, pension or other
employee benefit plan or program, (iii) take any action with respect to the
grant of any material severance or termination pay (other than pursuant to
policies or agreements of the Sellers or any of Transferred Entities in effect
on the date of this Agreement) which will become due and payable after the
Closing Date, and (iv) enter into any material employment, consulting or
similar agreement or amend any existing employment agreement, in each case
other than in the ordinary course of business, consistent with past practice or
pursuant to existing agreements or commitments or benefit plans or as required
by Law;


                    (g)
permit or allow any of the Purchased Assets to be subjected to any Encumbrance,
other than Permitted Encumbrances or allow any Transferred Entity to incur,
assume or guarantee any Indebtedness that exceeds $1,000,000 in the aggregate;


                    (h)
(i) enter into any Contract that would be a Material Contract, or amend or
modify or consent to the termination of any Material Contract, but excluding
any new Contracts or modifications or amendments to existing Contracts entered
into with customers or suppliers of the Business in the ordinary course of
business, Intellectual Property licenses entered into in the ordinary course of
business or, other than as set forth in clause (iv) below, lease extensions or
similar amendments to leases (including the Real Property Leases) entered into
in the ordinary course of business, (ii) waive or release any of Sellers’
material rights under such Contracts other than in the ordinary course of
business, (iii) materially increase the benefits under, or materially
amend the terms of, any U.S. Benefit Plan or Foreign Benefit Plan, other than,
with respect to this clause (iii), in the ordinary course of business or
pursuant to existing agreements or commitments or benefit plans or as required
by Law or National Laws, or (iv) exercise the renewal option with respect to
the Real Property Lease for 39 Old Ridgebury Road, Danbury, Connecticut; 


33





                    (i)
amend, terminate, cancel or compromise any material claims that would be
Purchased Assets or assets of any Transferred Entity or waive any other rights
of substantial value that would be Purchased Assets or assets of any
Transferred Entity other than in the ordinary course of business consistent
with past practice other than claims or rights that are Retained Assets or Retained
Liabilities;


                    (j)
enter into or consummate any transaction involving the acquisition of the
business, stock, assets or other properties of any other Person for
consideration in excess of $2,000,000, individually, or $5,000,000 in the
aggregate (other than purchases of Business Inventory in the ordinary course of
business consistent with past practice and capital expenditures identified in
the 2010 or 2011 capital expenditures budget previously Made Available to
Purchaser or required for health, safety or environmental regulatory
requirements); 


                    (k)
sell, assign, transfer, pledge, mortgage, encumber, abandon, dispose of or
otherwise grant any rights in any material Purchased Assets or such Transferred
Entity’s assets, other than as expressly required pursuant to existing
Contracts or the sale of Business Inventory in the ordinary course of business
consistent with past practice;


                    (l)
adopt any amendment to its articles of organization, operating agreement or
other applicable governing documents of the Transferred Entities, change the
authorized or issued capital stock of the Transferred Entities, or otherwise
reclassify, combine, split, subdivide or redeem, purchase or otherwise acquire,
directly or indirectly, any Transferred Entity’s capital stock, or declare, set
aside or pay any dividend or other distribution, other than the payment of cash
dividends or distributions of cash by any Transferred Entity prior to Closing;


                    (m)
fail to maintain the existing or substantially similar replacement insurance
coverage relating to the Owned Real Property or the real properties leased
under the Real Property Leases;


                    (n)
materially or substantially alter or amend any existing policies or binders of
insurance maintained in respect of the Business;


                    (o)
other than in the ordinary course of business, make any capital expenditure or
commitment therefor or enter into any capital leases, except as contemplated
under the 2010 or 2011 capital expenditures budget previously Made Available to
Purchaser or required for health, safety or environmental regulatory
requirements, or enter into any new line of business;


                    (p)
adopt a plan or agreement of complete or partial liquidation dissolution,
restructuring, merger, consolidation, recapitalization or other reorganization
of any Transferred Entity;


                    (q)
subject any Transferred Entity to any bankruptcy, receivership, insolvency or
similar proceedings;


                    (r)
make any material change in any method of accounting or auditing practice with
respect to the Business other than those required by GAAP;


34






                    (s)
other than in the ordinary course of business consistent with past practices,
make any loans, advances or capital contributions to, or investments in, any
other Person; 


                    (t)
other than in the ordinary course of business, amend any Related Party
Transaction in a manner adverse to the Business or enter into any new Related
Party Transactions; 


                    (u)
settle or compromise any litigation, audit, claim or action against any
Transferred Entity other than settlements or compromises of litigations,
audits, claims or actions (i) for which the amounts paid in settlement or
compromise do not exceed $1,000,000 individually or $5,000,000 in the aggregate
and (ii) that do not involve a grant of injunctive relief against any
Transferred Entity other than a matter that is a Retained Asset or Retained
Liability; 


                    (v)
make or change any material Tax election, change any annual Tax accounting
period, adopt or change any method of Tax accounting, amend any material Tax
Returns or file any claims for material Tax refunds, enter into any material
closing agreement, settle any material Tax claim, audit or assessment or
surrender any right to claim a material Tax refund, offset or other reduction
in Tax liability, in each case, when applied to the Sellers, with respect to
the Business; or 


                    (w)
authorize, commit or agree to take any of the foregoing actions in respect of
which it is restricted by the provisions of this Section 5.1.


For the avoidance of doubt, if an action is prohibited by any clause of
this Section 5.1, such action shall be prohibited for purposes of this Section
5.1 regardless of whether such action may be expressly permitted by another
clause of this Section 5.1. 


          Section
5.2. Confidentiality;
Access to Information.


                    (a)
The parties acknowledge that the information being Made Available to them by
Honeywell, Sellers and their respective Subsidiaries (or their respective
agents or representatives) is subject to the terms of a confidentiality
agreement dated November 18, 2010 by and between Rank Group and Honeywell (the
“Confidentiality
Agreement”), the terms of which are incorporated herein by
reference. Effective upon the Closing, the Confidentiality Agreement will
terminate; provided, however, that each of the parties hereby
acknowledges its confidentiality obligations in the Confidentiality Agreement
will terminate only with respect to information relating to the Business; and
that each of the parties acknowledges that any and all other information
provided or Made Available to it concerning Honeywell and its Subsidiaries will
remain subject to the terms and conditions of the Confidentiality Agreement
after the Closing.


                    (b)
From the date hereof until the Closing Date or earlier termination of this
Agreement, to the extent permitted by Law, Honeywell shall, and shall cause
Sellers and the Transferred Entities to provide Purchaser and its respective
officers and other representatives and employees with such access to the
facilities of the Business and its principal personnel and such books and
records pertaining to the Business as Purchaser may reasonably request in order
to effectuate the transactions contemplated hereby, without charge by Sellers
to Purchaser (but 


35





otherwise at Purchaser’s expense), provided, however,
that certain materials subject to any confidentiality obligations or attorney
client privilege, or which may not be shared with the other party pursuant to applicable
Law, have not been and will not be so delivered, but Honeywell shall use its
commercially reasonable efforts to disclose such information in a way that
would not violate such obligation or waive such privilege, and provided further,
that (i) Purchaser agrees that such access will be exercised during normal
business hours and without causing unreasonable interference with the
operations of the Business, and (ii) Sellers shall furnish to Purchaser or its
representatives, upon reasonable written request, such additional financial and
operating data and other information regarding the assets, properties,
liabilities and goodwill of the Business (or legible copies thereof) as
Purchaser may from time to time reasonably request. Purchaser and its representatives
shall not contact any suppliers, customers, landlords and other business
relations or employees of the Business without Honeywell’s prior written
consent.


          Section
5.3. Publicity. From the date hereof until the
Closing or earlier termination of this Agreement, Honeywell and Purchaser, and
their respective Affiliates, shall not, issue any press release or public
announcement concerning this Agreement or the transactions contemplated hereby
without obtaining the prior written approval of the other parties hereto, which
approval will not be unreasonably withheld or delayed, unless, in the
reasonable judgment of Honeywell or Purchaser, disclosure is otherwise required
by applicable Law or by the applicable rules of any stock exchange on which Honeywell
lists its securities; provided, however, that, to the extent
required by applicable Law or by the rules of any stock exchange, the party
intending to make such release or announcement shall use its reasonable best
efforts, consistent with such applicable Law, to consult with the other party
with respect to the text thereof and, provided further, that no
party shall be required to obtain consent pursuant to this Section 5.3
to the extent any proposed release or announcement is consistent with information
that has previously been made public without breach of the obligations under
this Section 5.3.


          Section
5.4. Post Closing Access.


                    (a)
Sellers will use commercially reasonable efforts to deliver or cause to be
delivered to Purchaser at the Closing all properties, books, records,
Contracts, information and documents in their or their Affiliates’ possession
that are part of the Purchased Assets. As soon as is reasonably practicable
after the Closing, Sellers will deliver or cause to be delivered to Purchaser
any remaining properties, books, records, Contracts, information and documents
that are part of the Purchased Assets that are not already in the possession or
control of Purchaser.


                    (b)
Each of the Sellers and Purchaser agrees that it will, and will cause its
Subsidiaries to, preserve and keep the books of accounts, financial and other
records held by it relating to the Business (including accountants’ work
papers) for a period of seven (7) years from the Closing Date in accordance
with their respective corporate records retention policies; provided
that prior to disposing of any such records in accordance with such policies
(if such records would be disposed of prior to the tenth anniversary of the
Closing Date), the applicable party shall provide written notice to the other
party of its intent to dispose of such records and shall provide such other
party the opportunity to take ownership and possession of such records (at such
other party’s sole expense) to the extent they relate to such other party’s
business or obligations within thirty (30) days after such notice is delivered.
If such other party does not confirm its intention in writing to take ownership
and possession of such records within such 30-


36





day period, the party who possesses the records may proceed with the
disposition of such records. 


                    (c)
Sellers and Purchaser shall make all records and other information relating to
the Business and all employees and auditors (including by making them available
for depositions, interrogatories, testimony, investigation and preparation in
connection with any legal or arbitration proceeding) available to the other as
may be reasonably required by such party (i) in connection with, among other
things, any audit or investigation of, insurance claims by, legal proceedings
against, disputes involving or governmental investigations of any Seller or
Purchaser or any of their respective Affiliates, including the Honeywell Filter
Litigation, (ii) in order to enable any Seller or Purchaser to comply with
their respective obligations under this Agreement and each other agreement,
document or instrument contemplated hereby or thereby, or (iii) for any other
reasonable business purpose relating to any Seller, Purchaser or any of their
respective Affiliates and Subsidiaries, but excluding, in each case, any
dispute between Honeywell or any of its Affiliates, on the one hand, and
Purchaser or any of its Affiliates, on the other hand, except as would be
required by applicable civil process or permitted by applicable discovery
rules.


                    (d)
Notwithstanding anything to the contrary contained herein and without limiting
the generality of this Section 5.4, Honeywell and Purchaser understand and
agree that Honeywell will, after the Closing Date, retain the exclusive right
to control, defend against, negotiate, settle or otherwise deal with any and
all aspects of the Honeywell Filter Litigation, provided that Honeywell will
keep Purchaser reasonably informed of the status of and material developments
in the Honeywell Filter Litigation. Purchaser further agrees to and to cause
its Subsidiaries (including, after the Closing Date, the Transferred Entities)
and their respective employees and representatives to, cooperate in good faith
with Honeywell and its employees and representatives in connection with such
control, defense, negotiation or settlement of the Honeywell Filter Litigation,
at Honeywell’s expense. Without limiting the generality of the foregoing,
Purchaser shall and shall cause its Subsidiaries (including, after the Closing
Date, the Transferred Entities) to, (i) deliver to Honeywell any and all
notices or other correspondence received by Purchaser, the Transferred Entities
or any of their Subsidiaries and Affiliates relating to the Honeywell Filter
Litigation; (ii) maintain all books, records and materials (in whatever form
maintained, whether documentary, electronically stored or otherwise) pertinent
to the Honeywell Filter Litigation unless and until Honeywell instructs
otherwise; and (iii) subject to compliance with applicable Laws, provide
Honeywell and its representatives, advisors and employees, reasonable access,
during normal business hours and upon reasonable advance notice, to the
Business facilities and all books, records and materials (in whatever form
maintained, whether documentary, electronically stored or otherwise), employees
and properties of the Business facilities as may be reasonably required by
Honeywell in connection with all matters relating to the Honeywell Filter
Litigation, and to make employees available as reasonably requested by
Honeywell depositions, interrogatories, court testimony and other legal
inquiries and procedures associated with the Honeywell Filter Litigation
(including preparation therefor), at Honeywell’s expense, including
reimbursement of any reasonable out-of-pocket expenses (including attorney’s
fees) actually incurred and documented incurred by Purchaser or its
Subsidiaries and Affiliates in complying with this Section 5.4(d). 


          Section
5.5. Required
Approvals; Consents.


37





                    (a)
Sellers and Purchaser shall each use their reasonable best efforts to take, or
cause to be taken, all action and to do, or cause to be done, all things
necessary, proper or advisable under applicable Laws and regulations to
consummate and make effective the transactions contemplated by this Agreement,
including using all reasonable best efforts to obtain all necessary waivers,
consents, and approvals, and/or submitting any necessary notices, including
those required by the Hart-Scott-Rodino Antitrust Improvement Act of 1976 (the
“HSR Act”)
or applicable foreign antitrust or foreign investment Laws. Without limiting
the foregoing, each Seller and Purchaser agrees (i) to submit the required HSR
Act filing as soon as reasonably practicable after the date of this Agreement,
but in no event later than fifteen (15) Business Days after the date hereof,
and to submit promptly thereafter any filings required by antitrust regulations
of other jurisdictions including foreign countries or required by foreign
investment Laws; (ii) to use reasonable best efforts to comply as expeditiously
as possible with all lawful requests of the Federal Trade Commission, the
Antitrust Division of the United States Department of Justice, or other
governmental competition authorities outside of the United States (the “Antitrust
Agencies”) for additional information or documents; (iii) to use
reasonable best efforts to cause the expeditious termination of the HSR Act and
any other regulatory waiting period; (iv) to inform promptly the other parties
of any material communications from any Antitrust Agency regarding the
transaction contemplated by this Agreement and provide copies to the other
party of all correspondence with any Antitrust Agency relating to this
Agreement; (v) and to provide promptly to the other parties such information as
the other parties may reasonably request in order to enable them to prepare the
filings, reports, documents and other materials referred to in this Section
5.5(a). Purchaser shall timely pay all fees in connection with any filings
with Antitrust Agencies.


                    (b)
Sellers shall, to the extent requested by Purchaser, give promptly
such notices to third parties and use its or their reasonable best efforts
(which shall not include any obligation of Sellers to pay any consideration
therefor or agree to relinquish or modify any rights in exchange therefor,
except as set forth in the following sentence) to obtain the consents listed on
Section 3.4(b) of the Disclosure Schedule and Purchaser shall
cooperate with Sellers in their efforts to obtain such consents, provided,
that, except as otherwise expressly provided in this Agreement, Purchaser shall
not be required to pay any costs or expenses in obtaining such consents.
With respect to the Contracts set forth on Schedule 5.5(b), Sellers and
Purchaser agree to pay up to $1,000,000 in the aggregate to third parties to
obtain (at Purchaser’s direction) any required consents, with Sellers bearing
30% of the aggregate amount of such payments to the extent made after the date
hereof and prior to the six month anniversary of the Closing Date. Purchaser
shall give promptly such notices to third parties and use its reasonable best
efforts to obtain the consents listed on Section 4.3(b) of the
Purchaser Disclosure Schedule and Sellers shall cooperate with Purchaser in
Purchaser’s efforts to obtain the consents listed on Schedule 4.3(b), provided,
that, except as otherwise expressly provided in this Agreement, Sellers shall
not be required to pay any costs or expenses in obtaining such consents. 


                    (c)
Without limiting Section 5.5(a), Sellers and
Purchaser shall each use their reasonable best efforts to avoid or eliminate
each and every impediment under any antitrust or foreign investment Laws that
may be asserted by any Governmental Authority with respect to the transactions
contemplated by this Agreement and the Transaction Documents so as to enable
the Closing to occur as soon as reasonably possible. In furtherance of the
foregoing, Purchaser and each of its Subsidiaries and Affiliates shall, if
necessary or desirable to obtain any required 


38





approvals, use its reasonable best efforts to contest and resist any
action, including any legislative, administrative or judicial action, and to
have vacated, lifted, reversed or overturned any decree, judgment, injunction
or other order (whether temporary, preliminary or permanent) that restricts,
delays, prevents or prohibits the consummation of the transactions contemplated
by this Agreement under any applicable antitrust Law. For the avoidance of
doubt, as used in this Section 5.5(c), “reasonable best efforts” shall
include engaging in, and defending against, litigation until such time as a
preliminary or permanent injunction that materially restricts or delays, or
prevents or prohibits the consummation of the transactions contemplated by this
Agreement has been issued pursuant to a judgment, ruling or decree of a court
of competent jurisdiction.


                    (d)
From the date of this Agreement through the Closing Date, Purchaser shall not
and shall cause its Affiliates not to, make any acquisition or agree to make
any acquisition or enter into or agree to enter into any joint venture or
similar arrangement (which shall, in each case, include any letter of intent,
or other arrangement, whether purporting to be binding or not), with respect to
any business competing with the Business in the U.S. automotive aftermarket
business or take any other action that could reasonably be expected to hinder
or delay the obtaining of clearance or the expiration of the required waiting
period under the HSR Act or any other applicable foreign antitrust Law,
provided that nothing in this Agreement shall limit the ability of Affiliates
of Purchaser to consummate the acquisition of UCI International, Inc. 


          Section
5.6. Further
Action.


                    (a)
From the date hereof until the Closing, Sellers and Purchaser shall use their
respective reasonable best efforts to take, or cause to be taken, all actions
(within their respective control) necessary or appropriate to consummate the
transactions contemplated by this Agreement. Without limiting the generality of
the foregoing, from time to time after the Closing Date, and for no further
consideration, Sellers and Purchaser shall execute, acknowledge and deliver
such assignments, transfers, consents, assumptions and other documents and
instruments and take such other actions as may reasonably be necessary to
appropriately consummate the transactions contemplated hereby, including (i)
transferring back to Honeywell or any Seller or its designated Subsidiaries any
asset or liability which was not contemplated by this Agreement to be
transferred to Purchaser at the Closing but was so transferred at the Closing
and (ii) transferring to Purchaser any asset or liability contemplated by this
Agreement to be transferred to Purchaser and which was not so transferred at
the Closing. To the extent there are any Contracts under which benefits accrue
to both the Business and to other businesses or business units of the Sellers,
Sellers and Purchaser shall use their respective reasonable best efforts to
continue to cause the benefits (and related Liabilities) to be available to the
Business or such other businesses or business units in the same manner after
the Closing. To the extent that a Contract that was transferred to Purchaser at
Closing as a Purchased Asset is necessary to the Sellers’ operation of other
businesses or business units in addition to the Business, Purchaser and Sellers
shall cooperate in good faith to make available to Sellers the benefits that
were necessary to conduct such other businesses or business units prior to the
Closing (and related Liabilities) to be available to Sellers in the same manner
after the Closing at prices consistent with historical practice of the
Business. Sellers shall comply with all requirements and obligations under
ISRA, and, prior to Closing, shall provide Purchaser documentation confirming
Sellers’ compliance with ISRA.


39





                    (b)
Prior to the Closing, Sellers shall use reasonable efforts to make internal
arrangements such that the services contemplated to be provided by Purchaser
post-Closing identified on Schedule B to the Transition Services Agreement will
not need to be provided and, in such event, such services shall be deleted from
the Transition Services Agreement. 


          Section
5.7. Expenses;
Transfer Taxes and VAT. 


                    (a)
Whether or not the transactions contemplated hereby are consummated, all costs
and expenses incurred in connection with this Agreement and the transactions
contemplated hereby (other than Retained Taxes and Transfer Taxes) shall be
paid by the party hereto incurring such expenses. 


                    (b)
Each of Honeywell and Purchaser shall pay one-half of any transfer,
documentary, sales, use, stamp, registration and other similar Taxes incurred as
a result of the transactions contemplated by Section 1.1(c) of this
Agreement (all such items so incurred are referred to herein collectively as “Transfer
Taxes”); provided that the foregoing shall not apply and Transfer
Taxes shall not include (i) any Taxes incurred in connection with the transfer
of Transferred Entities Retained Assets (which shall be Retained Taxes and
borne 100% by Sellers), (ii) any Taxes incurred in connection with the transfer
of any asset not contemplated by this Agreement to be transferred to Purchaser
at the Closing but was so transferred at the Closing and which is required to
be transferred back to Honeywell or any Seller or its designated Subsidiaries
pursuant to Section 5.6 (which Taxes shall be borne 100% by Sellers) and
(iii) any value-added or similar Taxes (“VAT”) (which are covered by Section
5.7(c)). Any necessary Tax Return or other documentation with respect to
any such Transfer Taxes shall be filed by the party required by applicable law
to file such Tax Return or other documentation. In the event that either party
receives a refund of any Transfer Taxes, such party shall pay an amount equal
to half of (i) the amount of such refund less (ii) any out-of-pocket expenses
or Taxes incurred by the party in connection with the receipt of such refund,
to the other party. Appropriate reconciliation payments shall be made if an
adjustment is made to the amounts taken into account under this Section
5.7(b). 


                    (c)
Sellers and Purchaser shall use commercially reasonable efforts to secure that
the transfer of Purchased Assets pursuant to Section 1.1(c) of this
Agreement is treated as neither a supply of goods nor a supply of services for
the purposes of any VAT. If nevertheless any VAT is payable on the transfer of
any of the Purchased Assets under Section 1.1(c) of this Agreement then
Purchaser shall pay to the applicable Seller the amount of such VAT (excluding
any interest and penalties imposed) within five (5) Business Days of written
demand by Sellers, Sellers shall remit such VAT (and any interest and penalties
imposed) and the applicable Seller shall issue to Purchaser a valid VAT invoice
in respect of that VAT and shall provide reasonable evidence of the basis on
which such VAT is payable. If and to the extent Purchaser is unable to recover
the VAT paid under this Section 5.7(c) from the relevant Taxing
Authority within three (3) months from the date of payment under this Section 5.7(c),
Sellers shall pay Purchaser 50% such non-recovered VAT. To the extent any such
non-recovered VAT is subsequently recovered by Purchaser after Sellers have
paid their share of such VAT to Purchaser, Purchaser shall pay over to Sellers
50% of any such recovered VAT (but in no event shall such payment exceed the
amount paid by Sellers to Purchaser with respect to such VAT). Appropriate
reconciliation 


40





payments shall be made if an adjustment is made to the amounts taken
into account under this Section 5.7(c). 


          Section
5.8. Employees
and Employee Benefit Plans. This Section 5.8 contains the
covenants and agreements of the parties with respect to (i) the status of
employment of the employees employed in the Business as of the Closing Date,
including Shared Employees but excluding Retained Employees (“Employees”),
upon the sale of the Business to Purchaser, and (ii) the employee benefits and
employee benefit plans provided or covering such Employees and former employees
of Honeywell and its Affiliates who terminated employment with Honeywell and
its Affiliates while employed in the Business or who retired from the Business
prior to the Closing Date (“Former Employees”). 


                    (a)
United States Employees. This Section 5.8(a) applies to Employees
employed in the United States Business as of the Closing Date, and Former
Employees who terminated employment with Honeywell and its Affiliates while
employed in the United States Business or retired from the United States
Business prior to the Closing Date.


	
  

 	
  

 
	
  

 	
                     (i)
 Continuation of Employment; Assumption of Current Liabilities for
 Employees. Effective as of the Closing Date, Purchaser shall, or shall
 cause an Affiliate to, (A) employ or continue to employ each and every
 Employee of the Transferred Entities, regardless of whether such Employee is
 actively employed on such date, and (B) offer employment to all other
 salaried and hourly persons who are designated on the records of any Seller
 and any Affiliate of Honeywell other than a Transferred Entity (each such
 Seller or Affiliate, an “Employee Transferor”) as of the Closing
 Date as Employees with respect to the United States Business and all Shared
 Employees, in either case if then actively at work, or on any form of leave
 (provided such leave was approved by the Employee Transferor consistent with
 past practice and, for the avoidance of doubt, except as required under Section
 5.8(c), not including any laid-off Employee) other than non-union
 represented employees on long-term disability leave or leave for military
 service. Such Employees accepting Purchaser’s or its Affiliate’s offer,
 together with the Employees of the Transferred Entities as of the Closing
 Date, will become “Transferred
 U.S. Employees” as of the Effective Time. For those
 non-union Employees who would otherwise be required to be employed by
 Purchaser or an Affiliate pursuant to this Section 5.8(a)(i) but
 who are on long-term disability leave as of the Effective Time, Purchaser
 shall, or shall cause its Affiliate to, offer employment to each such
 Employee to the extent such Employee recovers from such Employee’s disability
 and presents himself or herself to Purchaser or such Affiliate for active
 employment within six months of the Closing Date. For those non-union
 Employees who would otherwise be required to be employed by Purchaser or an Affiliate
 pursuant to this Section 5.8(a)(i) but who are on leave for
 military service as of the Effective Time, Purchaser shall, or shall cause
 its Affiliate to, offer employment to each such Employee to the extent such
 Employee presents himself or herself to Purchaser or such Affiliate for
 active employment within the period such Employee’s reemployment rights are
 guaranteed by applicable Law. Each Employee described in the two preceding
 sentences who accepts Purchaser’s (or its Affiliate’s) offer of employment
 will become a Transferred U.S. Employee as of the date such Employee returns
 to work with Purchaser or its Affiliate. Terms of employment continuation for
 each Transferred U.S. Employee 

 


41









	
  

 	
  

 
	
  

 	
 shall (A) require employment at the same work location, (B) pay a
 base wage rate no less than each such Transferred U.S. Employee’s base wage
 rate in effect immediately prior to the Closing Date, (C) provide a cash
 incentive compensation opportunity no less than each such Transferred U.S.
 Employee’s cash incentive compensation opportunity in effect immediately
 prior to the Closing Date, substituting such performance goals and criteria,
 if any, as Purchaser may reasonably determine for any such goals and criteria
 that are based on Honeywell’s performance, (D) as of the time the Employees
 become Transferred U.S. Employees, provide health (including medical, dental
 and vision care), life insurance, disability, vacation, flexible spending
 account, and retirement savings (but not defined benefit retirement) benefits
 that are not materially less favorable in the aggregate than those provided
 to the Transferred U.S. Employees by Honeywell and its Affiliates immediately
 prior to the Closing Date, and (E) otherwise comply with all other applicable
 provisions of this Section 5.8(a). Purchaser shall credit, or shall
 cause its Affiliates to credit, each Transferred U.S. Employee’s service with
 Honeywell and its Affiliates for all purposes, including eligibility,
 participation, benefit accrual and vesting. Purchaser and its Affiliates
 shall honor any recall or re-employment rights mandated by applicable Law or
 by contract of any Employees or Former Employees. On and after the Closing Date,
 Purchaser shall comply at its expense with all employment Laws with respect
 to the period of employment with Purchaser or its Affiliates of the
 Transferred U.S. Employees, including the Family and Medical Leave Act, the
 Americans with Disabilities Act and federal or state Laws on military leave.
 Purchaser shall likewise honor and assume all liability for accrued but
 unpaid wages, commitments to tuition reimbursement, and current year bonus
 entitlement, for all Transferred U.S. Employees. Nothing in this Agreement
 shall, or shall be construed to, limit the ability of Purchaser to terminate the
 employment of any Transferred U.S. Employee at any time after the Closing
 Date.

 
	
  

 	
  

 
	
  

 	
                     (ii)
 Severance Protection. From and after the Closing Date, Transferred
 U.S. Employees shall be entitled to the benefit of such severance plan or policy,
 if any, as Purchaser or its Affiliates may have in effect from time to time; provided,
 that service with Honeywell, Purchaser, and their respective Affiliates shall
 be taken into account in computing the amount of such benefit; and, provided
 further, that if Purchaser or any of its Affiliates terminates the
 employment of any Transferred U.S. Employee on or before the first
 anniversary of the Closing Date (including as a result of refusal of any
 Transferred U.S. Employee to accept a work relocation that is greater than
 fifty (50) miles from such Transferred U.S. Employee’s work location as of
 the Closing Date), Purchaser or its Affiliate shall provide a severance
 benefit consisting of salary continuation and continued insurance coverage
 that shall be no less than the severance benefit the Transferred U.S.
 Employee would have received under the terms of an Employee Transferor’s or a
 Transferred Entity’s severance plan(s), as applicable, in effect on the
 Closing Date, calculated as though the Transferred U.S. Employee worked
 continuously (by combining such Transferred U.S. Employee’s service for
 Honeywell and its Affiliates on the one hand, and Purchaser and its
 Affiliates on the other hand) until such Transferred U.S. Employee’s
 termination date with Purchaser or its Affiliate.

 
	
  

 	
  

 
	
  

 	
                     (iii) Cooperation. The United States Business agrees to use
 commercially reasonable efforts to facilitate the transition of Transferred
 U.S. Employees

 


42









	
  

 	
  

 
	
  

 	
 to employment with Purchaser or its Affiliate as of the Effective Time
 or such later time as may be required by Section 5.8(a)(i).

 
	
  

 	
  

 
	
  

 	
                     (iv)
 Savings Plan and Pension Plan.

 


                                        (A)
Savings Plan. Effective as of the time the Employees become Transferred
U.S. Employees, Transferred U.S. Employees shall cease to be eligible to
contribute to the Honeywell Savings and Ownership Plan (“Sellers’ Savings Plan”).
Effective as of the Closing Date, Purchaser shall establish or otherwise
maintain, or shall cause its Affiliate to establish or otherwise maintain, one
or more tax-qualified defined contribution savings plans (“Purchaser’s Savings Plans”)
that shall (i) permit immediate participation as of the Closing Date for the
Transferred U.S. Employees who were eligible to participate in Sellers’ Savings
Plan as of the day before the Closing Date; (ii) credit all service that was
credited under Sellers’ Savings Plan for purposes of the eligibility, vesting
and match eligibility requirements of the Purchaser’s Savings Plans; (iii) provide
for tax-deferred contributions pursuant to Section 401(k) of the Code, and (iv)
accept elective direct rollovers of Transferred U.S. Employees’ accounts under
Sellers’ Savings Plan to the extent payable in cash. The Purchaser’s Savings
Plans shall initially provide for employer matching contributions that are no
less favorable than those provided under the terms of Sellers’ Savings Plan.
Notwithstanding the foregoing, the Purchaser’s Savings Plan shall not be
required to offer participation to any Transferred U.S. Employee prior to the
date such Employee becomes a Transferred U.S. Employee. In accordance with the
terms of Sellers’ Savings Plan, as of the Closing Date, the accounts under the
Sellers’ Savings Plan for all Transferred U.S. Employees shall be 100% vested.


                                        (B)
Pension Plans. Effective as of the time the Employees become Transferred
U.S. Employees, Transferred U.S. Employees shall no longer be eligible to
accrue benefits under any defined benefit pension plan sponsored by an Employee
Transferor (“Sellers’ U.S. Pension Plan”).
The Employee Transferors shall retain all assets and liabilities related to
Sellers’ U.S. Pension Plan, and Purchaser shall have no obligation to replicate
the benefits of Sellers’ U.S. Pension Plan, except as follows. Prior to or as
soon as administratively practicable following, but in any event effective as
of, the Closing Date and in accordance with applicable Law, Honeywell shall
establish a plan that qualifies under Code Section 401(a) and a trust that
qualifies under Code Section 501(a) (“Purchaser’s U.S. Pension Plan”) for the
exclusive benefit of those Transferred U.S. Employees whose terms and
conditions of employment are governed by the collective bargaining agreements
pertaining to production and maintenance workers at Sellers’ Fostoria, Ohio and
Greenville, Ohio facilities (“Union Pension Participants”), the
identified sponsor of which shall be Purchaser or such Transferred Entity as
Purchaser shall have previously identified. Purchaser’s U.S. Pension Plan shall
be identical in all relevant respects to the terms of Sellers’ U.S. Pension
Plan applicable to the Union Pension Participants and on its establishment
shall have and assume all liabilities of Sellers’ U.S. Pension Plan in respect
of the Union Pension Participants and their dependents and beneficiaries.
Simultaneously with the establishment of Purchaser’s U.S. Pension Plan,
Honeywell shall cause the trust forming a part of Sellers’ U.S. Pension Plan to
transfer to the trust forming a part of Purchaser’s U.S. Pension Plan an amount
of assets in cash, cash equivalents or other assets of the trust to which
Purchaser has no reasonable objection, determined in accordance with the
provisions of Schedule F to this Agreement.


43





                              (v)
Employee Welfare Plans.


                                        (A)
Purchaser or its Affiliates shall, not later than the Closing Date, provide the
Transferred U.S. Employees and their spouses, dependents and beneficiaries with
health and life insurance, disability, severance, and other welfare benefit
plans and programs as Purchaser or its Affiliates shall determine, subject to
the requirements of this Section 5.8. Subject to any specific provision
of this Section 5.8 to the contrary, Sellers shall remain solely
responsible for liabilities or obligations incurred with respect to each Former
Employee and their spouses, dependents and beneficiaries under any of Sellers’
health (including medical, dental and vision care) and life insurance,
disability, severance and other welfare benefit plans and programs for
liabilities or obligations incurred prior to, on or following the Closing Date
and with respect to each Transferred U.S. Employee and their spouses,
dependents and beneficiaries under any of Sellers’ health (including medical,
dental and vision care) and life insurance, disability, severance and other
welfare benefit plans and programs for liabilities or obligations incurred
prior to the Closing Date. Purchaser and its Affiliates shall be solely
responsible for liabilities or obligations incurred with respect to each
Transferred U.S. Employee and their spouses, dependents and beneficiaries under
any of Purchaser’s, or any Transferred Entity’s health (including medical,
dental and vision care) and life insurance, disability, severance and other
welfare benefit plans and programs for liabilities incurred on or after the
Closing Date. For purposes of this Section 5.8(a)(v)(A), a liability or
obligation shall be deemed to be incurred upon the occurrence of an injury or
the diagnosis of an illness and the liability or obligation will include any
covered expenses for any related claims or series of related claims giving rise
to such liability or obligation, provided, that in the case of medical
and dental expenses, including under any flexible spending account plan, a
liability and obligation shall be deemed to be incurred only as and when claim
for payment of the same is received.


                                        (B)
Any plans or programs established or maintained by Purchaser or its Affiliates
to provide health (including medical, dental and vision care) and life
insurance, disability, severance, vacation, cafeteria, flexible spending,
dependent care and other welfare benefits for the benefit of the Transferred
U.S. Employees shall, (i) credit all service with Honeywell and its Affiliates
for purposes of eligibility, participation, benefit accrual and benefit
entitlement, (ii) waive any pre-existing condition limitation or exclusion or
any actively-at-work requirement, and (iii) credit all payments made for
healthcare expenses during the current plan year for purposes of deductibles,
co-payments and maximum out-of-pocket limits and (iv) subject to Section
5.8(c) and Section 5.8(a)(v)(C) below, until the first anniversary
of the Closing Date provide health (including medical, dental and vision care),
life insurance, disability, vacation, flexible spending account, and retirement
savings (but not defined benefit retirement) benefits that are not materially
less favorable in the aggregate than those provided to the Transferred U.S.
Employees by Honeywell and its Affiliates immediately prior to the Closing
Date. 


                                        (C)
For those Transferred U.S. Employees whose terms and conditions of employment
are governed by the Labor Contracts pertaining to production and maintenance
workers at Sellers’ Fostoria, Ohio and Greenville, Ohio facilities, and their
eligible spouses, dependents and beneficiaries, Purchaser shall or shall cause
its Affiliates to, establish and maintain health and life insurance coverage
(1) providing OPEB Benefits on the same terms and subject to the same
conditions as those in effect as of the Closing Date under the U.S.


44






Benefit Plans and required by the applicable Labor Contract, and (2)
offering the opportunity to qualify for such OPEB Benefits on the same terms
and subject to the same conditions as those in effect as of the Closing Date
under the U.S. Benefit Plans and required by the applicable Labor Contract in
the case of such of those Transferred U.S. Employees (and their eligible
spouses, dependents and beneficiaries) who have not become entitled to such
coverage under the U.S. Benefit Plans and applicable Labor Contract prior to
the Closing Date. After the Effective Time, Purchaser shall not, nor shall it
permit any of its Affiliates to, modify (whether to reduce or increase) any of
the OPEB Benefits or opportunities to earn such OPEB Benefits described in this
Section 5.8(a)(v)(C) if as a result Honeywell or any of its Affiliates
would incur any Liability, whether under any U.S. Benefit Plan or applicable
Labor Contract (and even if otherwise permitted, only after any required
bargaining under an applicable Labor Contract). 


                              (vi)
Severance and WARN Act Liability. Purchaser agrees to pay and be
responsible for (i) all liability, cost or expense for severance, salary
continuation, special bonuses and like costs under Purchaser’s severance pay
plans, retention agreements, policies or arrangements, (ii) any payment
obligations described in Section 5.8(a)(ii) with respect to any of the
Transferred U.S. Employees that arise and are in respect of the Transferred
U.S. Employees’ services performed for Purchaser or any of its Affiliates on or
after the Closing Date, and (iii) any severance obligations that arise on or
after January 1, 2011 in connection with any Sellers’ repositioning projects
approved by Purchaser under Section 5.1. Except as provided in the
foregoing sentence, Sellers shall be solely responsible and pay for all
liability, cost or expense, if any, for severance, salary continuation, special
bonuses and the like under the Employee Transferors’ or the Transferred
Entities’ severance pay plans, retention agreements, expatriate agreements,
employment agreements, policies or arrangements with respect to employees of
the Business that arise before the Closing, in connection with the consummation
of the transactions contemplated by this Agreement or a termination of
employment of any such individual by an Employee Transferor or a Transferred
Entity, including but not limited to, to the extent not satisfied nor required
to be satisfied prior to Closing, under the agreements set forth on or as
otherwise set forth on Section 5.8(a)(vi) of the Disclosure Schedule
Sellers agree to pay and be responsible for all liability, cost, expense and
sanctions resulting from any failure to comply with the WARN Act, and the
regulations thereunder, in connection with events which occur prior to the
Closing Date that relate to the Business. Purchaser agrees to pay and be
responsible for all liability, cost, expense and sanctions resulting from any
failure to comply with the WARN Act, and the regulations thereunder, in
connection with events which occur on or after the Closing Date that relate to
the Business. 


                              (vii)
Health Care Continuation Coverage. With respect to all health plans
maintained for Transferred U.S. Employees, Purchaser agrees to provide
(directly or through its Affiliates) continuation coverage required by COBRA to
all Transferred U.S. Employees and their covered beneficiaries who are entitled
to COBRA coverage with respect to qualifying events that occur after the Closing
Date. Purchaser agrees to pay and be responsible for all liability, cost,
expense, taxes and sanctions under Section 4980B of the Code, and interest and
penalties imposed upon, incurred by, or assessed against Purchaser or an
Employee Transferor that arise with respect to the Transferred U.S. Employees
and their covered beneficiaries after the Closing Date by reason of, or
relating to, any failure by Purchaser and its Affiliates to comply with the
health care continuation coverage requirements of COBRA as provided in the
immediately preceding sentence. 


45





                              (viii)
Worker’s Compensation. Purchaser shall be responsible for the
administration and the financial obligation of all worker’s compensation claims
with respect to the Transferred U.S. Employees arising out of or relating to
occurrences on or after the Closing Date and Sellers shall be responsible for
the administration and the financial obligation of all worker’s compensation
claims arising out of or relating to occurrences before the Closing Date; provided,
however, that the following specific principles shall apply to the
following specific claims:


                                        (A)
Modified Duty. If, prior to the first anniversary of the Closing Date,
Purchaser fails to continue to accommodate the modified or alternative work
arrangements that are in place as of the Closing Date for a Transferred U.S.
Employee (the “Modified Duty Employees”),
except if such failure to accommodate is the result of a termination of such
Modified Duty Employee’s employment for cause, then the Employee Transferors
and Purchaser shall share the applicable worker’s compensation liability, as
determined by the applicable worker’s compensation state Law, in proportion to
the length of time such Modified Duty Employee was on modified duty with an
Employee Transferor or Transferred Entity before the Closing Date and Purchaser
after the Closing Date. If such failure to accommodate described in the
preceding sentence occurs with respect to a Modified Duty Employee following
the first anniversary of the Closing Date or if a Modified Duty Employee
voluntarily leaves employment at any time for any reason other than an
unjustified failure by Purchaser to accommodate, then the Employee Transferors
shall bear all applicable worker’s compensation liability with respect to such
Modified Duty Employee and Purchaser shall not share any of such liability with
the Employee Transferors.


                                        (B)
Aggravated Injury. In the event that a Transferred U.S. Employee
notifies Purchaser after the Closing Date of a worker’s compensation injury
that is the result of an aggravation of an injury that occurred prior to the
Closing Date, the responsibility for the administration and financial
obligation of this claim (i.e., the allocation between Sellers’ worker’s
compensation coverage and Purchaser’s worker’s compensation coverage) will be
determined by the applicable worker’s compensation Law and is subject to the
final interpretation of the appropriate court. 


                              (ix)
No Assumption of Plans. Except for the assumption of the Labor Contracts
as provided in Section 5.8(c), and except as set forth on Section
5.8(a)(ix) of the Disclosure Schedule (the “Transferred U.S. Benefit Plans”), neither Purchaser nor its
Affiliates nor any Transferred Entity shall assume, or have any liability in
connection with, any U.S. Benefit Plan. Purchaser shall or shall cause one or
more of its Affiliates to assume all Liabilities under or in respect of the
Transferred U.S. Benefit Plans. Sellers shall cause each Transferred Entity to
(i) withdraw from or otherwise terminate its participation under each U.S.
Benefit Plan (other than the Transferred U.S. Benefit Plans), or (ii) if any
U.S. Benefit Plan other than a Transferred U.S. Benefit Plan is maintained or
sponsored solely by one or more Transferred Entities, terminate such plan, with
such withdrawal or termination of participation or plan termination effective
no later than the Closing Date. 


                              (x)
Vacation. Effective with the date an Employee becomes a Transferred U.S.
Employee, Purchaser shall assume liability for any earned but not taken 


46





vacation time (including any non-forfeitable vacation entitlement
otherwise payable only on termination of employment) of the Transferred U.S.
Employees. 


                              (xi)
Flexible Spending Accounts. Effective as of the Closing Date,
Transferred U.S. Employees shall no longer be eligible to contribute to the
health care flexible spending account or accounts sponsored by Sellers except
as otherwise provided by and in accordance with COBRA. Effective as of the
Closing Date, the Transferred U.S. Employees shall no longer be eligible to
contribute to the dependent care flexible spending accounts sponsored by the
Employee Transferors (such health and dependent care accounts, “Sellers’ FSAs”). Effective as of the
Closing Date, Purchaser shall establish or otherwise maintain, or shall cause
its Affiliate to establish or maintain, health care and dependent care flexible
spending accounts which shall (i) permit immediate participation as of the
Closing Date for all Transferred U.S. Employees who were eligible to
participate in the Employee Transferors’ FSAs as of the day before the Closing
Date and (ii) accept for reimbursement any claims related to the calendar year
in which the Closing Date occurs and eligible for reimbursement on the basis of
participant elections initially made under the Employee Transferors’ FSAs for
such year. Sellers shall pay to Purchaser an amount in cash equal to the
excess, if any, of (x) the aggregate accumulated contributions to the Sellers’
FSAs made during the year in which the Closing Date occurs by the Transferred
U.S. Employees over (y) the aggregate reimbursement payouts made for such year
from Sellers’ FSAs in respect of such Transferred U.S. Employees. 


                              (xii)
Employment Taxes. Sellers
and Purchaser will treat Purchaser as a “successor employer” and Sellers as a
“predecessor,” within the meaning of sections 3121(a)(1) and 3306(b)(1) of the
Code, with respect to Transferred U.S. Employees who are employed by Purchaser
(or any of its Affiliates) for purposes of Taxes imposed under the United States
Federal Unemployment Tax Act or the United States Federal Insurance
Contributions Act and any applicable Tax law relating to employment,
unemployment insurance, social security, disability, workers’ compensation,
payroll, health care or other similar Tax for which comparable treatment is
reasonably determined to be available without undue administrative burden on
either Party. 


                    (b)
Non-U.S. Employees. This Section 5.8(b) applies only to Employees
employed in the Non-United States Business as of the Closing Date, and Former
Employees who terminated employment with Honeywell or its Affiliates while
employed in the Non-United States Business or retired from the Non-United
States Business prior to the Closing Date. 


                              (i)
Employment. Each Employee employed by the Employee Transferors or the
Transferred Entities or any Affiliate of either in the Non-United States
Business, whether hourly or salaried, and who is actively at work on the
Closing Date, or who is absent on the Closing Date due to a recognized leave of
absence, whether paid or unpaid, shall be referred to as a “Non-U.S. Employee.” Wherever legally
permissible, on the Closing Date, Non-U.S. Employees shall become employees of
Purchaser or continue to be employees of a Transferred Entity by operation of
the applicable Laws or regulations of the jurisdiction in which such employment
is located (the “National Laws”,
which term shall include the EU Acquired Rights Directive, where applicable)
and/or pursuant to the terms of any agreed transfer agreement relating to that
jurisdiction. Where such continuation of employment or transfer is not possible
in the manner described in the previous sentence, Purchaser shall offer the
Non-U.S. 


47





Employees employment in accordance with any procedures required by
applicable National Laws to effectuate their employment with Purchaser or a
Transferred Entity commencing on the Closing Date. Each Non-U.S. Employee who,
as of the Closing Date, is employed by, or otherwise has such Employee
employment continued with, a Transferred Entity, otherwise transfers to the
employ of Purchaser or a Transferred Entity pursuant to National Laws or
accepts Purchaser’s offer of employment shall be referred to as a “Transferred Non-U.S. Employee.” No
provision herein shall impair, deny or limit the right of Purchaser or any of
its Affiliates to change the employment terms or to terminate the employment of
any Transferred Non-U.S. Employee at any time, to the extent permissible under
applicable National Laws and any applicable Labor Contract. 


                              (ii)
Compensation and Benefits; Severance Protection. Effective as of the
Closing Date, Purchaser or its Affiliates shall provide Transferred Non-U.S.
Employees with terms and conditions of employment, compensation and employee
benefits that are consistent with those (i) required to be provided by
Purchaser or its Affiliates under the Transferred Non-U.S. Employee’s
employment contract, if applicable, or (ii) if more favorable (or if the
Transferred Non-U.S. Employee does not have a contract), required by applicable
National Laws or an applicable Labor Contract. Without limiting the generality
of the foregoing, but subject to Section 5.8(b)(iii)(C) below, if
applicable, from and after the Closing Date, Transferred Non-U.S. Employees
shall, if required by applicable National Laws or an applicable employment
contract or Labor Contract, be entitled to at least the benefit of such
severance plan or policy, if any, as Purchaser or its Affiliates may have in
effect from time to time; provided that service with Honeywell,
Purchaser, and their respective Affiliates shall be taken into account in
computing the amount of any such benefit, and, provided further,
that if Purchaser or any of its Affiliates terminates the employment of any
Transferred Non-U.S. Employee on or before the first anniversary of the Closing
Date (including as a result of refusal of any Transferred Non-U.S. Employee to
accept a work relocation that is greater than fifty (50) miles from such
Transferred Non-U.S. Employee’s work location as of the Closing Date),
Purchaser or its Affiliate shall, if required by applicable National Laws or an
applicable employment contract or Labor Contract, provide at least a severance
benefit consisting of salary continuation and continued insurance coverage, if
any, that shall be no less than the severance benefit and insurance coverage
the Transferred Non-U.S. Employee would have received under the terms of an
Employer Transferor’s or a Transferred Entity’s severance plan(s), as
applicable, in effect on the Closing Date, calculated as though the Transferred
Non-U.S. Employee worked continuously (by combining such Transferred Non-U.S.
Employee’s service for Honeywell and its Affiliates on the one hand, and
Purchaser and its Affiliates on the other hand) until such Transferred Non-U.S.
Employee’s termination date with Purchaser or its Affiliate. 


                              (iii)
Foreign Benefit Plans. “Sellers’
Foreign Benefit Plans” means those Foreign Benefit Plans listed on Section
3.12(b) of the Disclosure Schedule to the extent they cover the Transferred
Non-U.S. Employees. 


                                        (A)
Except to the extent otherwise required by Law and except for those of Sellers’
Foreign Benefit Plans set forth on Section 5.8(b)(iii)(A) of the
Disclosure Schedule (the “Transferred Foreign
Benefit Plans”), as of the Closing Date, each Transferred Non-U.S.
Employee shall cease to be an active participant in Sellers’ Foreign Benefit
Plans. 


48





Purchaser shall or shall cause one or more of its Affiliates to assume
all Liabilities under or in respect of the Transferred Foreign Benefit Plans. 


                                        (B)
As of the Closing Date, Purchaser or its Affiliates shall provide employee
benefit plans, programs or arrangements outside of the United States in
accordance with the terms of this Agreement and applicable National Laws that,
in accordance with the obligation to provide total compensation and employee
benefits as provided in Section 5.8(b)(ii), (1) provide employee
benefits on the terms and conditions required to be provided by Purchaser or
its Affiliates under the Transferred Non-U.S. Employee’s employment contract,
if applicable, or (2) if more favorable than the employee benefits described in
subclause (1) (or if the Transferred Non-U.S. Employee does not have a
contract), provide employee benefits as required by applicable National Laws.
The Transferred Foreign Benefit Plans and the Employee Transferors’ insurance
contracts providing benefits that are maintained exclusively for the benefit of
employees of a Transferred Entity who become on the Closing Date Transferred
Non-U.S. Employees (inclusive of applicable assets, insurance contracts,
property or funds underlying, supporting or otherwise to be used or applied to
fund or pay benefits or liabilities under or with respect to such plans) will
be transferred or assigned to Purchaser or its Affiliates (or, in the case of
such assets, property or funds, to the applicable plan or plans so established
or maintained) no later than the Closing Date. With respect to any Sellers’
Foreign Benefit Plans that are not transferred to Purchaser as provided in the
preceding sentence and to the extent not otherwise required by Law, Sellers
shall cooperate to cause each Transferred Entity to (x) withdraw from or
otherwise terminate its participation under such Foreign Benefit Plans or, (y)
if any such Sellers’ Foreign Benefit Plan is maintained or sponsored solely by
one or more Transferred Entities, terminate such plan or merge such plan with
another plan of an Employee Transferor such that the obligations of the
Transferred Entity are assumed by an Employee Transferor, with such withdrawal
or termination of participation or plan termination or merger effective no
later than the Closing Date. 


                                        (C)
Purchaser shall provide each Transferred Non-U.S. Employee with credit for
service with Honeywell and its Affiliates and Purchaser for purposes of
eligibility to participate, and vesting and solely with respect to the
Transferred Foreign Benefit Plans (inclusive of related asset, contracts,
property and funds) that are transferred or assigned to Purchaser, benefit
accrual under Purchaser’s Non-U.S. Employee Benefits Plans. Notwithstanding the
preceding sentence, Purchaser shall not be obligated to recognize prior service
with Honeywell and its Affiliates in the case of any Non-U.S. Employee employed
in China and Singapore, or in the case of any Non-U.S.
Employee employed in Germany declining a transfer of employment to Purchaser or
an Affiliate. In respect of those Non-U.S. Employees in China, Singapore and
Germany, Sellers shall pay, and Purchaser shall directly reimburse Sellers at
the Closing Date for, the total severance amount set out in Section
5.8(b)(iii)(C) of the Disclosure Schedule or, if greater, any severance
required to be paid to such Non-U.S. Employees in China, Singapore and Germany
by applicable National Law or Labor Contract. 


                                        (D)
Purchaser or its Affiliates shall establish or otherwise maintain pension,
retirement and/or savings plans for Transferred Non-U.S. Employees (“Purchaser’s Foreign Retirement Plans”) that
shall (i) permit immediate participation as of the Closing Date, (ii) credit
all service with both Honeywell and Purchaser and their respective Affiliates
for purposes of the eligibility, vesting and employer contribution levels, and
(iii) 


49





otherwise fulfill the obligations of Purchaser as set forth in Section
5.8(b)(iii)(B). With respect to those Transferred Non-U.S. Employees who
were eligible to participate in the pension, retirement and savings plans set
forth on Section 5.8(b)(iii)(D)(i) of the Disclosure Schedule
(collectively “Sellers’ Foreign Retirement
Plans”) as of the Closing Date, the applicable Purchaser’s Foreign
Retirement Plans shall, as applicable, offer credit for service that was
credited under Sellers’ Foreign Retirement Plans, along with future service
with Purchaser, for purposes of the eligibility, vesting, and early retirement
eligibility, and such other terms and conditions, if any, as may be required in
the case of Transferred Foreign Benefit Plans or as expressly provided on Section
5.8(b)(iii)(D)(i) of the Disclosure Schedule. With respect to those
Transferred Non-U.S. Employees who were eligible to participate in the Foreign
Benefit Plans set forth on Section 5.8(b)(iii)(D)(ii) of the Disclosure
Schedule as of the Closing Date, Purchaser shall establish, and shall maintain
for so long as such Transferred Non-U.S. Employees remain employed at the
facilities locations such Transferred Non-U.S. Employees were employed at as of
the Closing Date, a new defined contribution benefit plan (funded only by
Purchaser, i.e., a Purchaser provided benefit equal to percentage of pay
determined by Purchaser) and offer credit for service that was credited under
such Foreign Benefit Plans, along with future service with Purchaser, for
purposes of the eligibility, vesting, and early retirement eligibility. 


                                        (E)
Except as otherwise expressly provided herein, no provision herein shall impair
Purchaser’s ability to amend or terminate any such plan at any time to the
extent permissible under applicable National Laws or Labor Contracts. 


                              (iv)
Termination and Severance Liabilities. Purchaser shall be responsible
for all amounts becoming payable to Non-U.S. Employees under applicable
National Laws, Purchaser’s severance plans or arrangements or any employment
contracts as a result of their being dismissed by Purchaser at any time on or
after the Closing Date, notwithstanding that such amounts are calculated under
applicable National Laws, plans, arrangements or employment contracts by
reference to periods of employment with Honeywell and its Affiliates as well as
periods of employment with Purchaser and its Affiliates. After the Closing,
Purchaser shall be responsible for any severance obligations with respect any
employees of the Business outside of the United States that arise on or after
January 1, 2011 in connection with any Sellers’ repositioning projects approved
by Purchaser under Section 5.1.  


                              (v)
Responsibility for Non-U.S. Employees. Except as otherwise set forth
herein, for employees who are Transferred Non-U.S. Employees as of the Closing
Date, Purchaser shall assume and thereafter pay, perform and discharge when due
any and all employment, compensation and employee benefit liabilities,
responsibilities and obligations with respect to such Transferred Non-U.S.
Employees, including any and all claims under National Laws, which liabilities,
responsibilities and obligations are incurred as the result of incidents,
events, acts or failures to act, occurring on or after the Closing Date. 


                              (vi)
Foreign Benefit Plan Asset Transfers. Sellers may agree to transfer, and
Purchaser may agree to accept, assets from or with respect to certain of Sellers’
Foreign Benefit Plans other than Transferred Foreign Benefit Plans. If any such
plan asset transfers are agreed, Sellers and Purchaser shall mutually agree
upon the terms and conditions of such transfers, subject to the provisions of
each such plan and the requirements of National 


50





Laws. In addition, Sellers and Purchaser may mutually agree to transfer
the liability with respect to benefits accrued or account balances accumulated
as of the applicable transfer date by Transferred Non-U.S. Employees under such
Sellers’ Foreign Benefit Plans other than Transferred Foreign Benefit Plans.
Where any transfer of assets or liability is agreed to in respect of a defined
benefit pension plan, Sellers’ actuaries and Purchaser’s actuaries will agree
to the liabilities and assets to be allocated to each of the transferee and
transferor plan or plans consistent with applicable National Laws. Following
the payment or transfer of agreed assets, and solely to the extent of the
liability attributable to such payment or transfer, Sellers and Sellers’
Foreign Retirement Plans will be discharged from such liability under such
Sellers’ Foreign Benefit Plans, and Purchaser’s or its Affiliates’ plan or
plans shall assume and be solely responsible for such liability. 


                              (vii)
Non-U.S. Employee Communications. Each party to this Agreement shall
comply with all obligations under applicable National Laws to provide
information to the other parties for onward transmission to Non-U.S. Employees
or their representatives and/or to provide such information directly to the
Non-U.S. Employees or their representatives. Each party to this Agreement shall
comply with all obligations under applicable National Law to inform and/or
consult Employees, trade unions, works councils or other employee
representative bodies in connection with the matters contemplated by this
Agreement. 


                              (viii)
Cooperation. To the extent permitted by Law, Purchaser shall give to the
Employee Transferors, and Sellers shall give, or cause to be given, to
Purchaser, on a timely basis, all requisite and pertinent information which the
Employee Transferors and Purchaser, respectively, may require in order to
comply with their respective obligations with respect to Employees and Former
Employees. 


                              (ix)
Employee Refusal to Transfer. Any Non-U.S. Employee lawfully rejecting
the transfer to or employment by Purchaser or its Affiliates shall remain (or,
in the case of an employee of a Transferred Entity, shall be) employed by the
Employee Transferors; provided, however, that the Employee Transferors may
terminate such Non-U.S. Employee immediately after Closing, subject to
applicable legal constraints, if any, and shall be solely responsible for any
severance payment or compensation or other benefit to or with respect to such
Non-U.S. Employee. Purchaser shall be responsible for all costs with respect to
such terminations to the extent such costs arise as a result of Purchaser’s
failure to comply with the obligations set forth in Sections 5.8(b)(i)
and (ii). 


                              (x)
Section 75 Debt. As provided in Section 5.8(b)(iii)(A) and (B),
with effect from Closing, Holt UK will withdraw as a participating employer
from those pension schemes in the United Kingdom in which it is a participating
employer, including the Honeywell UK Pension Scheme (collectively, the “UK Pension Scheme”) and employees of Holt
UK will cease to be active members of the UK Pension Scheme. Sellers shall pay
or shall cause to be paid directly to the trustees of the UK Pension Scheme any
Section 75 Debt that arises as a result of Holt UK withdrawing as a
participating employer under the UK Pension Scheme. 


                    (c)
Labor Contracts. 


51





                              (i)
In respect of the Transferred U.S. Employees and the Transferred Non-U.S.
Employees, Purchaser shall, or shall cause an Affiliate to, assume each of (A)
the collective bargaining agreements pertaining to production and maintenance
workers at Sellers’ Fostoria, Ohio and Greenville, Ohio facilities, (B) the
labor agreement pertaining to employees of Honeywell Mexico 2, (C) those
employment, retention, and expatriate agreements set forth on Section 5.8(c)
of the Disclosure Schedule, and (D) any national collective bargaining
agreements under applicable National Law, or Works Council agreements, with
respect to the Non-U.S. Business (individually, a “Labor Contract” and collectively, the “Labor Contracts”), and to honor and fulfill
all of the Employee Transferors’ obligations under each of the Labor Contracts
in accordance with and subject to their terms. Purchaser and Honeywell shall
each cooperate for the purposes of, including providing the relevant
representative of any group covered by a Labor Contract with required notices,
bargaining with the representative, if required by the terms of the Labor
Contract or any applicable Law or National Law, and taking any other necessary
actions in connection with negotiating any changes in the terms of employment
of the Employees covered by such Labor Contract necessary or appropriate to
effectuate the transfer of employment and Liabilities for such Employees on
terms and conditions consistent with this Section 5.8. Purchaser shall
be exclusively responsible for any Liability incurred in connection with any
change negotiated by or at the direction or with the prior written approval of
Purchaser in respect of such Labor Contracts. 


                              (ii)
Purchaser shall, or shall cause an Affiliate to, employ each Employee whose
terms of employment are covered by a Labor Contract on all of the terms and
conditions of employment of the applicable Labor Contract on the Closing Date,
including wages, benefits, severance protection (if any), provision of pension,
health and other benefit plans, vacation, leave, hours or work and other terms
and conditions of employment in effect with respect to such Employee on the
Closing Date, and honor and fulfill all applicable obligations under the
applicable Labor Contract in respect to such Employee, except as the same may
be modified consistent with applicable Law or National Law. 


                              (iii)
Effect. This Section 5.8(c) shall supersede any contrary provisions of Section
5.8(a).  


                    (d)
Stock Award Plans. With respect to any outstanding stock options or
equity awards granted to Transferred U.S. Employees and Transferred Non-U.S.
Employees, such Employees shall be able to exercise vested options and receive any
vested awards under the Employee Transferors’ equity plan in accordance with
the terms of the applicable plan and award agreement. Except as otherwise
required by Law, Employees shall incur a termination date under the Employee
Transferors’ equity and stock purchase plans as of the Closing Date. To the
extent required under applicable National Laws, each Transferred Non-U.S.
Employee who was, immediately prior to the Closing Date, a member of an
Employee Transferor’s equity or stock purchase plan will be provided
remuneration by Purchaser or its Affiliates of an equivalent value to such
membership, with effect from the Closing Date. Nothing contained in this Section
5.8 shall require Purchaser or its Affiliates to grant any stock options or
equity awards to any Transferred U.S. Employee or Transferred Non.-U.S.
Employee on or after the Closing Date. 


                    (e)
Non-U.S. Employee Communications. Each party to this Agreement shall
comply with all obligations under applicable National Laws to provide
information to the other 


52





parties for onward transmission to Non-U.S. Employees or their
representatives and/or to provide such information directly to the Non-U.S.
Employees or their representatives. 


                    (f)
Temporary, Etc. Employees. Prior to the Closing Date, Purchaser shall
take steps to enter into an agreement with the provider of subcontracted
employees to the Business to enable the transfer of such subcontracted
employees from the related contract of the Employee Transferors to a contract
of Purchaser as of the Closing Date. Sellers will cooperate with Purchaser to
affect this transfer. 


          Section
5.9. Intercompany Accounts. Prior
to the Closing Date, Sellers will use reasonable best efforts to cause any
amounts owed to or by a Transferred Entity or a Seller related to the Business
from or to Sellers or other divisions or Affiliates of Sellers (other than a
Transferred Entity or another part of the Business) to be settled. Prior to
Closing, Sellers may (but are not required to) cause any amounts owed to or by
a Transferred Entity or a Seller related to the Business from or to a
Transferred Entity or another part of the Business to be settled. 


          Section
5.10. Non-Solicitation of Employees.
Honeywell agrees that for a period of three years from the Closing Date,
without the prior written consent of Purchaser, it will not, directly or
indirectly, solicit for employment any Transferred Employee (other than
clerical or non-salaried employees and except as set forth on Schedule 5.10);
provided, however, that the foregoing shall not prohibit
Honeywell from (a) engaging in the general solicitation (whether by newspaper,
trade publication or other periodical or pursuant to the use of an executive
search consultant) of employees (or hiring any Transferred Employees that
respond to such general solicitation) so long as such solicitation is not
directed specifically at any Transferred Employee or any other employees of the
Business after the Closing, (b) soliciting any employee of the Business after
the Closing (other than clerical or non-salaried employees) who has not been
employed by Purchaser during the three-month period preceding such solicitation
or who was involuntarily terminated by Purchaser, or (c) employing the Retained
Employees after the Closing Date. Purchaser agrees that for the same period and
subject to the same exceptions, it will not, directly or indirectly, solicit
any Retained Employee or any other Employee who does not become a Transferred
U.S. Employee or a Transferred Non-U.S. Employee (other than clerical or
non-salaried employees). 


          Section
5.11. Non-Competition Covenant. 


                    (a)
For a period of three (3) years from the Closing Date, Honeywell and each
Seller agrees that it will not, and each Seller will cause its Controlled
Affiliates not to, directly or indirectly, engage in the design, distribution,
manufacture, marketing or sale of Business Products (a “Competing Business”); provided, however,
that nothing in this Section 5.11(a) shall be deemed to limit in any way
(i) the conduct of any Excluded Business, (ii) the activities of Honeywell or
its Affiliates with respect to component elements of any of the items included
within the definition of a Competing Business or (iii) the sale by Honeywell or
its Affiliates of any parts or products to the extent such parts or products
are sourced from a third party and incorporated into products other than
Business Products that are manufactured or sold by businesses operated by Honeywell
or its Affiliates or the manufacturing by Honeywell or its Affiliates of any
parts or products to the extent such parts or products are manufactured for
internal use by Honeywell or its Affiliates. The restrictions set forth in this
Section 5.11(a) shall 


53





not be construed to prohibit or restrict any Seller or any of its
Controlled Affiliates from acquiring any Person or business that engages in any
Competing Business; provided that (i) the engagement in such Competing
Business does not constitute the principal part of the activities of the Person
or business to be acquired (based on total revenues expressed in US dollars or
calculated in U.S. dollars utilizing the relevant and then applicable current
foreign currency exchange rate, of all sales of such Person or business during
the consecutive four (4) full calendar quarters immediately preceding the
effective date of acquisition of such Person or business), and (ii) if the
Competing Business constitutes in excess of 20% of the revenues of the Person
or business acquired, Sellers will use their commercially reasonable efforts to
divest that portion of such Person or business that engages in the Competing
Business within 12 months after its acquisition of the Competing Business and,
prior to offering such portion to any third party, shall first offer to and
negotiate in good faith for a period not to exceed 30 days with Purchaser or
its Affiliates for the acquisition of such portion by Purchaser or its
Affiliates; provided further, that to the extent participation in
such Competing Business involves the acquisition of or the right to acquire any
class of the voting securities of such Competing Business, this covenant shall
not be violated if the percentage of such voting securities acquired or to be acquired
does not exceed 5% at the time of such acquisition. 


                    (b)
Notwithstanding anything to the contrary in this Agreement, the prohibitions in
Section 5.11(a) shall not apply to (i) any businesses or operations of
Sellers or any of their Subsidiaries which are transferred to any third party
after the date hereof, (ii) any Subsidiaries of any Seller the stock of which
is transferred to any third party after the date hereof, (iii) any Affiliate of
Sellers who becomes an Affiliate as a result of a change of control of
Honeywell or (iv) any acquisition of securities by any Seller’s pension trust
or similar employee benefit plan investment vehicle, provided, that any
securities acquired shall be held for investment purposes only and such benefit
plans comply with the ERISA requirements as to the independence of investment
decisions. 


                    (c)
Each Seller acknowledges and agrees that the remedy at law for any breach, or
threatened breach, of any of the provisions of this Section 5.11 may be
inadequate and, accordingly, each Seller covenants and agrees that Purchaser
shall, in addition to any other rights and remedies which Purchaser may have at
Law, be entitled to seek equitable relief, including injunctive relief, and to
the remedy of specific performance with respect to any breach or threatened
breach of the provisions of this Section 5.11, as may be available from
any court of competent jurisdiction without the need to post bond or any other
security. In addition, Sellers and Purchaser agree that the provisions of this Section
5.11 are fair and reasonable in light of Purchaser’s plans for the Business
and are necessary to accomplish the full transfer of the goodwill and other
intangible assets contemplated hereby. In the event that any of the provisions
of this Section 5.11 shall be determined by any court of competent
jurisdiction to be unenforceable for any reason whatsoever, then all other
provisions of this Section 5.11 shall remain in full force and effect,
and the parties hereto agree that such unenforceable provision may be modified
by the court so as to comply with applicable Law and that the provisions of
this Section 5.11 shall be amended in accordance with said modification.



                    (d)
Notwithstanding any provision of this Section 5.11, the ownership and
operation by Sellers of the Delayed Transfer Assets for the benefit of
Purchaser and its Affiliates 


54






from the Closing Date until the Delayed Closing Date in accordance with
Section 10.13 shall not constitute a violation of Section 5.11.


          Section
5.12. Confidential
Information. Each Seller hereby agrees that for a period of three
(3) years from the Closing Date it shall hold, and shall cause its Affiliates
to hold and maintain the confidentiality of all information relating to trade
secrets, processes, patent applications, product development, price, customer
and supplier lists, pricing and marketing plans, policies and strategies,
details of client and consultant contracts, operations methods, product
development techniques, business acquisition plans, new personnel acquisition
plans and all other confidential or proprietary information concerning the
Business or the Purchased Assets (the “Confidential Information”), and shall not
use for the benefit of themselves or others, or disclose or cause or permit to
be used or disclosed any of the Confidential Information for any reason or
purpose whatsoever, except and to the extent any disclosure of Confidential
Information is required by Law or appropriate court order and sufficient
advance written notice thereof, if reasonably practicable, is provided to
Purchaser to permit Purchaser to seek a protective order or other appropriate
remedy, provided, however, that the term “Confidential
Information” shall not include information that (i) does not relate to the
Business, (ii) relates to any Retained Asset, Retained Liability, any Excluded
Business or, if applicable, the Retained Interests, (iii) becomes available to
any Seller or any of its Affiliates after the Closing on a non-confidential
basis from a source other than Purchaser, (iv) is independently developed by
any Seller, any of its Affiliates or their respective employees under
circumstances not involving a breach of this Section 5.12, (v) is
publicly disclosed pursuant to a lawful requirement or request from a
Governmental Authority acting within its jurisdiction, or non-confidential
disclosure is otherwise required by Law after any Seller or any of its
Affiliates has exercised its commercially reasonable efforts to obtain
assurances that confidential treatment will be accorded to such information,
(vi) is publicly available as of the date of this Agreement, or which becomes
publicly available after the date of this Agreement through no disclosure of
any Seller or its Affiliates, (vii) disclosed on a confidential basis to
Sellers’ attorneys, accountants, lenders and investment bankers, or
(viii) disclosed or used by Sellers or any of their Affiliates to protect
or enforce their rights or perform their obligations under this Agreement and
the Transaction Documents, in connection with tax or other regulatory filings,
litigation, financial reporting or other reasonable business purposes, or the
conduct of their own businesses if, and to the extent, not otherwise prohibited
by Section 5.11. 


          Section
5.13. Payments
Received. Sellers and Purchaser agree that, after the Closing Date,
they shall hold and shall promptly transfer and deliver to the other party,
from time to time as and when received by it and in the currency received, any
cash, checks with appropriate endorsements (using commercially reasonable
efforts not to convert such checks into cash), or other property that they may
receive after the date hereof which property belongs to the other party,
including any payments of accounts receivable and insurance proceeds, and shall
account to the other party for all such receipts. In the event of a dispute
between the parties regarding any party’s obligations under this Section
5.13, the parties shall cooperate and act in good faith to promptly resolve
such dispute and, in connection with such cooperation, allow each other
reasonable access to the records of the other relating to such disputed item. 


          Section
5.14. Sellers’
Marks. Except as expressly set forth herein, each of Purchaser and
each of its Subsidiaries and Affiliates and its and their respective directors,
officers, 


55





successors, assigns, agents, or representatives shall not register or
own, or attempt to register or own, and shall not directly or indirectly use,
in any fashion, including in signage, corporate letterhead, business cards,
internet websites, marketing material and the like, or seek to register or own,
in connection with any products or services anywhere in the world in any
medium, any Intellectual Property that includes, is identical to or is
confusingly similar to, any of the trademarks, service marks, domain names,
trade names, trade dress, trade styles or other indicia of origin that are
characterized as a Retained Asset or constitute Excluded Intellectual Property
including the HONEYWELL mark or any derivation therefrom or any corporate
symbols or logos incorporating “HONEYWELL” either alone or in combinations or
any goodwill represented thereby and pertaining thereto (collectively, “Sellers’
Marks”), nor shall any of them challenge or assist any third party
in opposing the rights of Honeywell anywhere in the world in any such
Intellectual Property. Subject to the restrictions set forth herein, Honeywell
hereby extends to Purchaser effective as of the Closing Date, a personal,
nonexclusive, royalty-free transition license (i) for one (1) year after the
Closing Date to continue to use the Sellers’ Marks on existing signage included
in the Purchased Assets and in the Business Inventory as of the Closing Date,
(ii) for one (1) year after the Closing Date to continue to use the Sellers’
Marks on marketing materials and other materials included in Purchased Assets
as of the Closing Date, and (iii) for five (5) years on Business Inventory
included in the Purchased Assets as of the Closing Date or manufactured within
180 days after the Closing Date. No new use of Sellers’ Marks shall be made by
Purchaser and Purchaser shall in any event transition away from all use of
Sellers’ Marks as soon as is reasonably practicable after the Closing Date. All
use of Sellers’ Marks as permitted hereunder shall inure solely to the benefit of
Honeywell. Purchaser shall incur all costs associated with re-branding of
Business Inventory with signage, symbols and marks not constituting Sellers’
Marks or Excluded Intellectual Property during the term, and after the
expiration, of the licenses granted under this Section 5.14. 


          Section
5.15. Tax
Matters. 


                    (a)
Tax Indemnity. From and after the Closing, Sellers shall indemnify
Purchaser and its Affiliates (including the Transferred Entities) and hold them
harmless from and against all Retained Taxes and related Losses. Purchaser and
Sellers agree that the Transferred Entities shall be deemed, for the purpose of
Sellers’ and their Affiliates’ obligations under this Section 5.15(a),
not to have the benefit of any net operating loss, net capital loss or other
Tax attribute, credit or benefit that is attributable to, arises from or
relates to any Post-Closing Tax Period. The indemnification made pursuant to
this Section 5.15(a) shall not be subject to the limitations on indemnification
contained in Section 9.4. All payments made pursuant to
this Section 5.15(a) shall be deemed to be adjustments to the Purchase
Price.


                    (b)
Tax Returns. 


                              (i)
Sellers will prepare, or cause to be prepared, (A) all Tax Returns for Income
Taxes of any Transferred Entity for any taxable period ending on or prior to
the Closing Date, (B) all Tax Returns for Taxes (other than Income Taxes) of
any Transferred Entity for any taxable period ending on or prior to December
31, 2010, (C) all Tax Returns for Taxes (other than Income Taxes) with respect
to the Business (other than a Transferred Entity) or the Purchased Assets for
any taxable period ending on or prior to December 31, 2010, (D) all Tax Returns
for Taxes (other than Income Taxes) with respect to the Business (other than a 


56





Transferred Entity) or the
Purchased Assets required by Law to be filed by Sellers or their Affiliates
(other than the Transferred Entities), (E) all Tax Returns of any Transferred
Entity organized in the United Kingdom relating to U.K. corporation tax for
any Straddle Period and (F) any other Tax Returns for Taxes (other than Income
Taxes) of any Transferred Entity or with respect to the Business or the
Purchased Assets due (taking into account all available extensions) prior to
the Closing Date.


                              (ii)
Following the Closing, Purchaser will prepare, or cause to be prepared, all
Straddle Period Tax Returns that are required to be filed by the Transferred
Entities or in respect of the Business or the Purchased Assets other than any
such Straddle Period Tax Return required to be prepared by Sellers pursuant to Section
5.15(b)(i). 


                              (iii)
Each Tax Return described in this Section 5.15(b) shall (to the extent
it relates to the Business or the Purchased Assets) be prepared in a manner
consistent with past practice, including as to Tax elections and Tax accounting
methods, unless such inconsistency or change (A) would not have a detrimental
effect on the other party or its Affiliates (including, in the case of
Purchaser, the Transferred Entities) or (B) is otherwise required by applicable
Law. Each Tax Return described in this Section 5.15(b) shall be filed by
the Person required by Law to file such Tax Return.


                              (iv)
Each party responsible for the preparation of a Tax Return for Income Taxes of
a Transferred Entity under this Section 5.15(b) shall submit such Tax
Return to the other party (together with schedules, statements and, to the
extent required by such other party, supporting documentation) at least forty
(40) days prior to the due date (including extensions) of such Tax Return, provided
that (i) in the case of a Tax Return for Income Taxes of a Transferred Entity
which is required to be prepared by Sellers under Section 5.15(b)(i),
will be filed by Sellers or their Affiliates (other than a Transferred Entity),
and is a consolidated, combined or unitary Tax Return that includes entities
other than Transferred Entities, Sellers shall not be required to submit to
Purchaser such consolidated, combined or unitary Tax Return but shall be
required to submit a pro forma Tax Return of the Transferred Entity (together
with supporting documentation and workpapers) and (ii) in the case of a Tax
Return for Income Taxes of a Transferred Entity which is required to be
prepared by Purchaser under Section 5.15(b)(ii), will be filed by
Purchaser or its Affiliates (including the Transferred Entities), and is a
consolidated, combined or unitary Tax Return that includes entities other than
Transferred Entities, Purchaser shall not be required to submit to Sellers such
consolidated, combined or unitary Tax Return but shall be required to submit a
pro forma Tax Return of the Transferred Entity (together with supporting
documentation and workpapers). If such other party objects to any item on any
such Tax Return, it shall, within thirty (30) days after delivery of such Tax
Return, notify the party responsible for the preparation of such Tax Return in
writing that it so objects, specifying with particularity any such item and
stating the specific factual or legal basis for any such objection. If a notice
of objection is duly delivered, the parties shall negotiate in good faith and
use their reasonable best efforts to resolve such items. In the event of any
disagreement that can not be resolved by the parties, such disagreement shall
be resolved by an accounting firm of international reputation mutually
agreeable to Sellers and Purchaser (the “Tax Accountant”), and any such
determination by the Tax Accountant shall be final. The fees and expenses of
the Tax Accountant shall be borne equally by Sellers and Purchaser. If the Tax
Accountant does not resolve any differences between Sellers and Purchaser with
respect to such 


57





Tax Return at least five
days prior to the due date therefor, such Tax Return shall be filed as prepared
by the party preparing such Tax Return and amended to reflect the Tax
Accountant’s resolution.


                              (v)
Sellers’ consolidated federal Income Tax Returns for the taxable period that
includes the Closing Date shall be filed in accordance with Section
1.1502-76(b)(2)(i) of the Treasury Regulations (determined using the closing of
the books method), with no election under Section 1.1502-76(b)(2)(ii)(D) of the
Treasury Regulations. Sellers shall make or cause to be made (and shall refrain
from making or causing to be made, as applicable) Tax elections (including on a
protective basis) so that no Transferred Entity shall suffer any reduction in
tax basis or other attributes pursuant to Treasury Regulations Section
1.1502-36. Sellers shall not make (or permit to be made) any election under
Section 108(i) of the Code (or any similar provision under state, local or
foreign Law) that applies to any income or deduction realized by any
Transferred Entity prior to the Closing.


                              (vi)
For purposes of this Agreement, in the case of any Taxes that are imposed on a
periodic basis and payable for a taxable period that includes (but does not end
on) a given date, the portion of such Tax which relates to the portion of such
taxable period ending on such date shall (i) in the case of any real and
personal property Taxes, be deemed to be the amount of such Tax for the entire
taxable period multiplied by a fraction the numerator of which is the number of
days in the taxable period ending on such date and the denominator of which is
the number of days in the entire taxable period, and (ii) in the case of any
other Tax, be deemed equal to the amount which would be payable if the relevant
taxable period ended on such date. Any credits (including prepayments and
deposits of Taxes) relating to a taxable period that begins on or before and ends
after given date shall be taken into account as though the relevant taxable
period ended on such date. For the avoidance of doubt, for purposes of this Section
5.15(b)(vi), (i) in the case of any Income Tax attributable to the
ownership of an entity that is taxed as a partnership or of any other entity
that is treated as a “flow-through” entity for Tax purposes (excluding a
“controlled foreign corporation” within the meaning of Section 957(a) of the
Code), the portion of such Income Tax that relates to the Pre-Closing Tax
Period shall be deemed to be the amount that would be payable if the relevant
Tax period of such “flow-through” entity ended on the Closing Date and (ii) in
the case of a Straddle Period Tax Return for any Transferred Entity organized in
the United Kingdom, any tax deduction for the Section 75 Debt shall be deemed
to be allocated to the Pre-Closing Tax Period of the relevant U.K. Transferred
Entity or Entities. 


                              (c)
U.K. Group Tax Returns. Where a Transferred Entity is, for U.K. Tax
purposes, a member of a combined, unitary or affiliated group or in a fiscal
unity with Honeywell, other Sellers or their Affiliates for any taxable period
(or portion thereof) ending on or before the Closing Date, Honeywell, other
Sellers or their Affiliates (i) shall, if required or permitted by applicable
Law, use any of their losses, credits or other Tax attributes (in each case for
U.K. Tax purposes) to reduce the U.K. Tax liability of the Transferred Entity
(at no cost to Purchaser, the Transferred Entity or their Affiliates) for
taxable periods (or portions thereof) ending on or before the Closing Date and
(ii) may, if required or permitted by applicable U.K. Law, use any losses,
credits or other Tax attributes (in each case for U.K. Tax purposes) of the
Transferred Entity arising in a taxable period (or portion thereof) ending on
or before the Closing Date to reduce their own U.K. Tax liability and shall not
be required to compensate the 


58





Transferred Entity,
Purchaser of their Affiliates for any such losses, credits or other Tax
attributes. No inference shall be drawn from this Section 5.15(c)
regarding any other Taxes. 


                    (d)
Refunds. If Purchaser or any Transferred Entity receives a refund (or a
credit of Taxes paid in lieu of a refund) of Retained Taxes (other than to the
extent such refund or credit results from the carryback of a Tax attribute
arising from a Post-Closing Tax Period), Purchaser will pay to the applicable
Seller, within thirty (30) days following the receipt of such refund (or the
application of such credit), an amount equal to such refund (or credit) less
Purchaser’s reasonable out-of-pocket expenses incurred in connection with
obtaining such refund. If Honeywell or any of its Affiliates receives a refund
(or a credit of Taxes paid in lieu of a refund) of Taxes of or with respect to
the Business or any Transferred Entity that (i) are not Retained Taxes or (ii)
are Retained Taxes but are attributable to the carryback of a Tax attribute arising
from a Post-Closing Tax Period (but only if Purchaser is required by Law to
(and unable to elect not to) carry back such Tax attribute in order to preserve
such Tax attribute), Honeywell will pay to Purchaser, within thirty (30) days
following the receipt of such refund (or the application of such credit), an
amount equal to such refund (or credit) less its reasonable out-of-pocket
expenses incurred in connection with obtaining such refund. For the avoidance
of doubt, this Section 5.15(d) shall not apply to any amounts covered by
Section 5.7. Notwithstanding anything to the contrary contained herein,
in the event of any inconsistency between this Section 5.15(d) and Section
1.1(c)(xvi) or Section 1.2(j), this Section 5.15(d) shall
govern.


                    (e)
Settlement of Deficiencies and Adjustments. 


                              (i)
In General. If any Taxing Authority issues to Purchaser or a Transferred
Entity a notice of deficiency or any other type of proposed adjustment of Taxes
of the Transferred Entity that could give rise to Retained Taxes, Purchaser
shall notify Sellers within thirty (30) Business Days of receipt of the notice
of deficiency or other proposed adjustment, provided that failure to
give such notification shall not affect the indemnification provided pursuant
to Section 5.15(a) except to the extent Sellers shall have been actually
prejudiced as a result of such failure. If any Taxing Authority issues to a
Seller or any Affiliate of any Seller a notice of deficiency or any other type
of proposed adjustment that could give rise to Taxes (other than Income Taxes
of a Seller) of or with respect to the Business or any Purchased Asset, Seller
shall notify Purchaser within thirty (30) Business Days of receipt of the
notice of deficiency or other proposed adjustment. Except as otherwise provided
herein, (A) Sellers (at their own expense) shall control any Tax Proceeding
relating to the Business or any Purchased Asset to the extent such Tax
Proceeding relates to (x) a Tax Return for Income Taxes of a Seller or (y) a
Tax Return described in Section 5.15(b)(i)(A)-(E) and (B) Purchaser (at
its own expense) shall control any Tax Proceeding relating to the Business or
any Purchased Asset that is not described in clause (A). 


                              (ii)
Participation Rights. In the case of any Tax Proceeding relating to a
Tax Return described in Section 5.15(b)(i) or (ii), the party
controlling such Tax Proceeding shall (to the extent related to the Business or
any Purchased Asset) (A) notify the other party of significant developments
with respect to such Tax Proceeding and keep the other party reasonably
informed and consult with the other party as to the resolution of any issue
that would materially affect such other party, (B) give to the other party a
copy of any Tax adjustment proposed in writing with respect to such Tax
Proceeding and copies of any other written 


59







correspondence with the
relevant Tax authority relating to such Tax Proceeding, (C) not settle or
compromise any issue without the consent of such other party, which consent
shall not be unreasonably withheld, (D) otherwise permit the other party to
participate in all aspects of such Tax Proceeding, at such other party’s own
expense; provided that (w) this Section 5.15(e)(ii) (other than
the last sentence hereof) shall not apply to a Tax Proceeding relating to an
Income Tax Return of any Seller (except to the extent it includes items of a
Transferred Entity), (x) Section 5.15(e)(ii)(C) shall not apply to any
settlement or compromise of a Tax Proceeding relating to non-Income Taxes of a
Seller if such Tax Proceeding involves Taxes unrelated to the Business or the
Purchased Assets and could not give rise to any Taxes related to the Business
or the Purchased Assets (other than Retained Taxes), (y) if a Tax Proceeding
(i) relates to non-Income Taxes of a Seller, (ii) involves Taxes unrelated to
the Business or the Purchased Assets and (iii) could give rise to Taxes related
to the Business or the Purchased Assets (other than Retained Taxes), Sellers
may settle the Tax Proceeding without Purchaser’s consent and Sellers shall
indemnify Purchaser from any Taxes described in (iii) (which Taxes shall be
treated as Retained Taxes for purposes of the last sentence of this Section
5.15(e)), and (z) if a Tax Proceeding (other than a Tax Proceeding relating
to a Tax Return described in Section 5.15(b)(i)(E)) relates solely to
Retained Taxes of a Transferred Entity or solely to Retained Taxes (other than
Income Taxes) of a Seller that relate solely to the Business or the Purchased
Assets, and if the Seller is able to settle the Tax Proceeding for a specific
amount, Purchaser may withhold its consent to such settlement only if Purchaser
agrees to take control of such Tax Proceeding at its expenses and Purchaser
agrees that Seller’s indemnification obligation under Section 5.15(a)
with respect to such Retained Taxes shall be limited to the settlement amount
for which such Seller could have settled such Retained Taxes if Purchaser had
not objected to the proposed settlement. Notwithstanding the
foregoing, in connection with any Tax Proceeding described in clause (w), (x)
(y) or (z), Sellers shall not enter into any agreement with a Taxing Authority
or otherwise take any action that would legally bind Purchaser, any Transferred
Entity or any of their Affiliates as to (or that would have the effect of
making a legally-binding admission as to) any Tax that is not a Retained Tax
without the consent of Purchaser, which consent shall not be unreasonably withheld.


                    (f)
Cooperation and Exchange of Information. Sellers and Purchaser shall
provide each other with such cooperation and information as either of them
reasonably may request of the other in filing any Tax Return, amended return or
claim for refund, determining a liability for Taxes or a right to refund of
Taxes, compiling any tax information packages or in conducting any audit or
other proceeding in respect of Taxes. Such cooperation and information shall
include (i) providing copies of all relevant Tax Returns, together with
accompanying schedules and related workpapers, documents relating to rulings or
other determinations by taxing authorities and records concerning the ownership
and tax basis of property, which either party may possess and (ii) to the
extent reasonably feasible, compiling and submitting any tax data packages
requested by the other party consistent with the past practices of, and within
the time periods requested by, the requesting party. Each party shall make its employees
available on a mutually convenient basis to provide explanation of any
documents or information provided hereunder. Except as otherwise provided in
this Agreement, the party requesting assistance hereunder shall reimburse the
other for any reasonable out of pocket costs incurred in providing any return,
document or other written information, and shall compensate the other for any
reasonable costs (excluding wages and salaries) of making employees available,
upon receipt of 


60





reasonable documentation
of such costs. Each party will retain and maintain all returns, schedules and
workpapers and all material records, computer software and data maintained
there under, or other documents relating thereto, until the expiration of the
statute of limitations (including extensions) of the taxable years to which
such returns and other documents relate and, unless such returns and other
documents are offered to the other party, until the final determination of any
payments which may be required in respect of such years under this Agreement
and to give the other party reasonable notice prior to transferring, destroying
or discarding any such book and records or computer software and data
maintained there under, and, if the other party so requests, shall allow the
other party to take possession of such books and records or computer software
and data maintained there under. Any information obtained under this Section
5.15(f) shall be kept confidential, except as may be otherwise necessary in
connection with the filing of returns or claims for refund or in conducting any
audit or other proceeding. Purchaser and Sellers further agree, upon request
and at the cost of the requesting party, to use their commercially reasonable
efforts to obtain any certificate or other document from any Governmental
Authority or any other person as may be necessary to mitigate, reduce or
eliminate any Tax that could be imposed (including with respect to the
transactions contemplated hereby).


                    (g)
Termination of Prior Tax Sharing Agreements and Powers of Attorney.
Effective as of the Closing Date, all Tax sharing agreements, whether or not
written, to which any Seller or any Transferred Entity is party shall be
terminated, and the Transferred Entity shall have no further rights or
obligations thereunder, and the provisions of this Agreement shall govern the
rights and obligations of Sellers, Purchaser and the Transferred Entities to
make or receive payments with respect to Taxes or refunds of Taxes of the
Transferred Entities. Any and all existing powers of attorney with respect to
Taxes or Tax Returns to which any Transferred Entity is a party shall be
terminated as of the Closing Date. Sellers shall execute (and shall cause the
Transferred Entities to execute) any documents that may be reasonably required
to evidence agreement with this Section 5.15(g).


                    (h)
Code Section 338(g) Elections. It is understood and agreed
that Purchaser may not make an election under
Section 338(g) of the Code with respect to any of Holts South Africa, Holt New
Zealand, Holt Japan,
Prestone and Alsip Packaging, Inc. unless requested to do
so pursuant to Section 5.15(i) below or otherwise with the prior written
consent of Honeywell, but
Purchaser may make an election under Section 338(g) of the Code with respect to
any other Transferred Entity without the consent of Honeywell.


                    (i)
Post-Closing Transactions. If Holt Japan, Holts South Africa or Holt New
Zealand makes a distribution governed by Section 301 of the Code during the
period beginning after the Closing Date and ending on December 31, 2011 (“Short Period”), or if Purchaser or any of
its Affiliates (including the Transferred Entities) engages in a transaction
which will result in Holt Japan, Holts South Africa or Holt New Zealand being
treated for U.S. federal income Tax purposes as having made a distribution
governed by Section 301 of the Code during the Short Period, then (i) Purchaser
shall promptly give notice to Honeywell of such action (and any details
available to Purchaser with respect thereto), provided that, for the
avoidance of doubt, Purchaser shall be under no obligation under this Section
5.15(i) to make any computations regarding the amount of the earnings and
profits of any entity and (ii) if Honeywell requests in a written notice given
to Purchaser no later than the 15th day of the eighth month
beginning after 


61





the Closing Date, then Purchaser shall make an election under Section
338(g) of the Code with respect to its acquisition of the stock of whichever of
Holt Japan, Holts South Africa or Holt New Zealand actually or was deemed to
have made a distribution governed by Section 301 of the Code.


          Section
5.16. Bulk
Sales Laws. Sellers and Purchaser each hereby waive compliance by
Honeywell with the provisions of the “bulk sales,” “bulk transfer” or similar
Laws of any state.


          Section
5.17. Notice
of Developments. Prior to the Closing, Sellers and Purchaser shall
promptly notify each other in writing of all events, circumstances, facts and
occurrences arising subsequent to the date of this Agreement which would be
reasonably likely to result in any condition in Article VI or Article VII
becoming incapable of being satisfied by such party.


          Section
5.18. Conduct
of Incidents Subject to Parent Insurances. Purchaser acknowledges
that coverage for the Business under the insurance policies set forth on Schedule
5.18 (the “Parent Insurances”),
will cease as of the Closing Date, and that neither the Sellers nor any of their
Affiliates will purchase any “tail” policy or other additional or substitute
coverage for the benefit of Purchaser relating to the Parent Insurances or the
Business applicable in any period after the Closing Date. Notwithstanding this
provision, Honeywell and the Sellers agree that Honeywell, or one of its
Affiliates, shall, with respect to any incident from which an Assumed Liability
arises or that relates to any damage, impairment or loss of a Purchased Asset
or an asset of Transferred Entity, that is potentially covered by a Parent
Insurance policy in effect prior to the Closing Date, (i) report such incident
to the appropriate insurer as promptly as practicable and in accordance with
the terms and conditions of the Parent Insurance policy after such incident is
reported to a member of Honeywell’s Corporate Risk Management group, (ii)
include Purchaser on material correspondence and possible litigation
proceedings relating to such incident and (iii) instruct that such proceeds are
paid directly to the injured party in settlement of any claims relating to such
incident, rather than to Honeywell or its Affiliates, or, if such proceeds are
received by Honeywell or any of its Affiliates, pay such proceeds over to
Purchaser; provided that Purchaser shall notify Honeywell Corporate Risk
Management group promptly of any potential claim, shall cooperate in the
investigation and pursuit of any claim, shall have the right to effectively
associate in the pursuit of any claim, including but not limited to the ability
to withhold its consent to any proposed claim settlement (such consent not to
be unreasonably conditioned, withheld or delayed) and shall bear all reasonable
out-of-pocket expenses incurred by the Sellers or its Affiliates in connection
with the foregoing and provided further that the Sellers and
their Affiliates shall be obligated to use only commercially reasonable efforts
to pursue any claims that are potentially covered by available Parent Insurance
and shall not, for the avoidance of doubt, have any obligation to commence any
litigation with respect to any matter potentially covered by any Parent
Insurance. Notwithstanding the foregoing, neither Honeywell nor any Seller
makes any representation or warranty as to whether any recovery under any Parent
Insurance will be received with respect to any particular incident arising
before or after the Closing Date. Purchaser agrees that no Seller shall have
any liability under this Agreement or otherwise for any Liabilities for failure
by Purchaser to report in a timely manner or for delays in reporting by
Purchaser or its Affiliates that void any available coverage under Parent
Insurance. 


62





          Section
5.19. Replacement
Letters of Credit; Replacement Guarantees. Purchaser covenants and
agrees that it shall use commercially reasonable efforts to obtain new letters
of credit to substitute for and replace the letters of credit extended by
Sellers or their Affiliates (other than a Transferred Entity) on behalf of a
Transferred Entity or the Business (“Sellers’ Letters of Credit”) effective as
of the Closing Date that have been identified to Purchaser for substitution or
replacement prior to the date hereof (including the Sellers’ Letters of Credit
set forth on Schedule 5.19), or that have been entered into in the
ordinary course of business after the date hereof, it being the intention and
understanding of Purchaser and Sellers that such Sellers’ Letters of Credit
shall, to the extent agreed by the beneficiaries thereof, be canceled and
terminated as of the Closing Date, and, to the extent agreed by the
beneficiaries thereof, Sellers and their Affiliates shall have no further
obligation or liability (contingent or otherwise) under such Sellers’ Letters
of Credit from and after the Closing Date. Purchaser further covenants and
agrees that it shall use commercially reasonable efforts to obtain the release
of the guarantees extended by a Seller or its Affiliates (other than a
Transferred Entity) on behalf of a Transferred Entity or the Business (“Sellers’
Guaranties”) effective as of the Closing Date that have been
identified to Purchaser for release prior to the date hereof (including the
Sellers’ Guarantees set forth on Schedule 5.19) or that have been
entered into in the ordinary course of business after the date hereof.
Following the Closing, Purchaser shall indemnify and hold Sellers and the
Subsidiaries and Affiliates that are a party to such Sellers’ Letter of Credit
or Sellers’ Guaranty harmless from any and all payments required to be made
under, and costs and expenses incurred in connection with, such Sellers’ Letter
of Credit or Sellers’ Guaranty. For purposes hereof, “commercially reasonable
efforts” shall include Purchaser’s (i) obtaining a letter of credit for which
the relevant Seller is a beneficiary (on terms identical to the corresponding
Sellers’ Letter of Credit) if the beneficiaries of such Sellers’ Letter of
Credit do not agree to a substitution or replacement and (ii) extending a
guarantee of which the relevant Seller is a beneficiary (on terms identical to
the corresponding Seller Guaranty) if the beneficiaries of such Seller Guaranty
do not agree to a release of such Seller or applicable Affiliate.


          Section
5.20. Affiliate
Agreements. Subject to Section 5.9, prior to the Closing Date,
Sellers and their Affiliates will cause all Contracts or other transactions
between Sellers and their Affiliates (other than the Transferred Entities), on
the one hand, and the Transferred Entities, on the other, as set forth on Section
3.20 of the Disclosure Schedule or with respect to which there could be
further or continuing Liability or obligation on the part of Purchaser or any
of its Affiliates (including the Transferred Entities after the Closing) to be
settled or terminated prior to the Closing without any further or continuing
Liability on the part of Purchaser or any of its Affiliates (including
Liability arising from such termination) so that no Related Party Transaction
remains in effect.


          Section
5.21. Exclusivity.
Each Seller and each of its respective Subsidiaries and Affiliates agrees that
from the date hereof until the earlier of the Closing Date and the date that
this Agreement is terminated pursuant to Article VIII, each such Person
shall not, and shall instruct its agents, representatives and Affiliates not
to, directly or indirectly (a) Make Available any non-public information
to any third party (including via access to any data room or other records),
other than Purchaser, or their agents, representatives and Affiliates with respect
to the Business in connection with any Competing Business Transaction,
(b) solicit, facilitate, initiate, respond to or encourage proposals,
offers or inquiries from a third party, other than Purchaser, with respect to
any Competing Business Transaction, (c) solicit, facilitate, initiate,
respond to or 


63





participate in any negotiations or discussions with any third party,
other than Purchaser, or its agents, representatives and Affiliates with
respect to any Competing Business Transaction, or (d) enter into a letter
of intent or other agreement or arrangement with a third party, other than
Purchaser, with respect to any Competing Business Transaction. Honeywell shall
immediately upon execution hereof terminate any and all discussions, negotiations
or communications involving itself, a Seller or any of their respective agents,
representatives, Subsidiaries and Affiliates regarding any Competing Business
Transaction and immediately request the return or destruction of any
confidential or proprietary information regarding the Business, a Seller or its
Subsidiaries previously Made Available to any third party in connection with
discussions or the evaluation of any Competing Business Transaction.


          Section
5.22. Financing.
Rank Group has and will have at the Closing, cash on hand and/or undrawn
amounts available under existing credit facilities necessary to allow Purchaser
to consummate the transactions contemplated by this Agreement and deliver the
Purchase Price at the Closing. Rank Group shall provide such amount in
immediately available funds to Purchaser at the Closing to the extent Purchaser
does not as of such time have immediately available funds available from other
sources to be used to deliver the Purchase Price. Prior to the Closing, Rank
Group will keep Honeywell reasonably informed of its plans to obtain the Debt
Financing and the progress of the financing efforts. Rank Group has Made
Available to Honeywell true and complete copies of its unaudited, consolidated
financial statements for the period ended June 30, 2010, which statements give a true and
fair view of the financial position and performance of Rank Group and its
Subsidiaries as of the date thereof and for the period covered thereby, in
accordance with New Zealand GAAP, consistently applied.


          Section
5.23. Cooperation
with Financing.


                    (a)
The Sellers shall, and shall cause each of their Subsidiaries to, and use their
commercially reasonable efforts to cause their and each of the Transferred
Entities’ (and their Subsidiaries’) representatives to (it being understood
that, except as provided in Section 5.23(a)(iii)(A) below, Purchaser
shall bear all reasonable third-party costs and out-of-pocket expenses of
Sellers, Transferred Entities and their respective Subsidiaries incurred
pursuant to this Section 5.23(a)), reasonably cooperate to assist
Purchaser in connection with the arrangement of customary senior debt and
high-yield debt financing to finance the transactions contemplated hereby (the
“Debt Financing”),
and in causing the conditions thereof to be satisfied, as may be reasonably
requested by Purchaser (provided that such requested cooperation does not
unreasonably interfere with the ongoing operations of the Sellers and their
Subsidiaries). Such cooperation shall include, at the reasonable request of
Purchaser,


                              (i)
participating in a reasonable number of meetings, presentations, road shows,
due diligence sessions, drafting sessions and sessions with rating agencies;


                              (ii)
providing (x) authorization letters to Purchaser’s financing sources
authorizing the distribution of information of customary types (including the
Required Information) concerning the Business, the Transferred Entities and the
Purchased Assets to prospective lenders or purchasers; provided, that
such information is distributed subject to customary confidentiality
undertakings with respect thereto, and (y) customary representations as
to the information so distributed; provided, that Sellers may satisfy
their obligations under clause


64






(y) by causing a Transferred Employee reasonably acceptable to
Purchaser to make such representations in its capacity as an officer of
Purchaser or a Subsidiary of Purchaser in which case Purchaser shall appoint
such Transferred Employee in such capacity and shall indemnify such Transferred
Employee (with such indemnity back stopped by Rank Group) for the actions taken
by such Transferred Employee prior to the Effective Time in his capacity as an
officer of Purchaser or a Subsidiary of Purchaser;


                              (iii)
(A) at the Sellers’ sole expense, furnishing Purchaser and its financing
sources (x) as promptly as practicable, but in no event later than April 15,
2011, with audited combined balance sheets and related statements of income and
cash flows of the Business prepared in accordance with GAAP for the fiscal year
ended December 31, 2010, such financial statements to be audited and
accompanied by a report and opinion of PricewaterhouseCoopers LLP, or an
independent certified public accountant reasonably acceptable to Purchaser,
which report and opinion shall not be subject to any “going concern” or like
qualification or exception or any qualification or exception as to the scope of
such audit and (y) as promptly as practicable, but in no event later than 45
days after the end of such fiscal quarter, with unaudited combined balance
sheets and related statements of income and cash flows of the Business prepared
in accordance with GAAP for each fiscal quarter ended after December 31, 2010 and
at least 45 days prior to the Closing Date and for the comparable quarter of
the prior fiscal year, (B) furnishing Purchaser and its financing sources as
promptly as practicable with financial information regarding the Business, the
Transferred Entities and the Purchased Assets as may be reasonably requested by
Purchaser in connection with the Debt Financing, including all financial
statements and pro forma financial information prepared in accordance with
GAAP, financial data, audit reports and other information regarding the
Business of the type that would be required by Regulation S-X and Regulation
S-K promulgated under the Securities Act for a registered public offering of
non-convertible debt securities of a person that has acquired the Business (including
for the preparation of pro forma financial statements), to the extent the same
is of the type and form customarily included in an offering memorandum for
private placements of non-convertible high-yield bonds under Rule 144A
promulgated under the Securities Act, or otherwise necessary to receive from
PricewaterhouseCoopers LLP (and any other accountant to the extent financial
statements audited or reviewed by such accountants are or would be included in
such offering memorandum) customary “comfort” (including “negative assurance”
comfort), together with drafts of customary comfort letters that such
independent accountants are prepared to deliver upon Closing, with respect to
the financial information to be included in such offering memorandum and which,
with respect to any interim financial statements, shall have been reviewed by
the Sellers’ independent accountants as provided in AU 722; and (C) assisting
Purchaser, as reasonably requested, in the preparation of customary rating
agency presentations, lender presentations and high yield road show
presentations or memoranda, any tender or solicitation documents (if required),
customary bank offering memoranda, syndication memoranda, private offering
memoranda, and other marketing materials or memoranda, including business and
financial projections reasonably requested by Purchaser, in each case, required
in connection with the Debt Financing (all such information in this clause
(iii), together with any replacements or restatements thereof, and supplements thereto,
if any such information would go stale or is otherwise required to be restated
or supplemented pursuant to applicable Law or accounting standards, the “Required
Information”);


65





                              (iv)
(A) using commercially reasonable efforts to obtain customary landlord
consents, landlord waivers and estoppels and non-disturbance agreements and (B)
to cooperate with Purchaser in its efforts to obtain surveys, appraisals and
title insurance, in each case relating to the Debt Financing, provided,
that, in each case, where applicable, such documents will not take effect until
the Effective Time;


                              (v)
(A) providing Purchaser and its financing sources with other pertinent
information regarding the Business, the Transferred Entities and the Purchased
Assets as may be reasonably requested by Purchaser in connection with the Debt
Financing, including in order to facilitate the pledging of assets and
properties in connection therewith, (B) providing information reasonably
requested to permit the prospective lenders involved in the Debt Financing to
evaluate the Business and the Transferred Entities and their Subsidiaries’
current assets, cash management and accounting systems, policies and procedures
relating thereto for the purpose of establishing collateral arrangements and
(C) taking actions reasonably requested to establish bank and other accounts
and blocked account agreements and lock box arrangements in connection with the
foregoing, provided that such accounts, agreements and arrangements shall not
become active or take effect until the Effective Time, provided, that
such information is distributed subject to customary confidentiality
undertakings with respect thereto;


                              (vi)
granting the providers of the Debt Financing, on reasonable terms and upon
reasonable request, at reasonable times and on reasonable notice, access to the
Transferred Entities’ respective facilities; 


                              (vii)
using commercially reasonable efforts to obtain consents of accountants for use
of their reports in customary offering materials relating to the Debt
Financing; 


                              (viii)
taking all actions reasonably requested to facilitate arrangements for the
discharge as of the Effective Time of any indebtedness, liens, hedge agreements
or other obligations of the Transferred Entities or with respect to the
Purchased Assets in connection with the Debt Financing, including obtaining
customary payoff letters, lien terminations and other instruments of discharge;


                              (ix)
using commercially reasonable efforts to provide supporting data and information,
to the extent that it is available to the Business, as is reasonably required
to enable Purchaser to prepare any schedule describing the material qualitative
and quantitative differences between the financial statements prepared with
respect to the Business in accordance with GAAP and financial statements
prepared in accordance with International Financial Reporting Standards in
connection with the Debt Financing; and


                              (x)
furnishing Purchaser and its financing sources promptly with all documentation
and other information required by regulatory authorities under applicable “know
your customer” and anti-money laundering rules and regulations, including
without limitation the PATRIOT Act.


                    (b)
Purchaser may seek to consummate all or a portion of the Debt Financing prior
to the commencement of the Marketing Period hereunder; provided, that
unless such


66





closing occurs after the Effective Time, none of the Transferred
Entities shall incur any liability or obligations thereunder until after the
Effective Time, nor be obligated to execute any documentation in connection
therewith prior to the Effective Time (except pursuant to Section
5.23(a)(ii) or (vii)), nor shall any assets of the Business, the
Transferred Entities or the Purchased Assets be subject to any lien or security
interest until after the Effective Time. In this regard, and subject to Section
5.23(c) below, the Sellers acknowledge that their cooperation obligations
in this Section 5.23 include the obligation to cooperate with any such
efforts.


                    (c)
The Sellers hereby consent to the use of the Transferred Entities’ logos in
marketing materials solely for the purpose of obtaining the Debt Financing.
Honeywell shall be entitled to approve all such use of the Transferred
Entities’ logos in advance, which approval shall not be unreasonably withheld.
Notwithstanding anything in this Agreement to the contrary, none of the Sellers
or, prior to the Effective Time, the Transferred Entities, shall be required to
pay any commitment or other similar fee or out-of-pocket expense (except under clauses
(iii), (ix) and (x) of subsection (a)), or incur any other liability or
obligation in connection with the Debt Financing (or any replacements thereof)
for which it is not reimbursed by Purchaser, or at Sellers’ sole option,
Purchaser shall advance (or pay directly) the funds necessary to pay any such
cost or expense. The Sellers, their Subsidiaries and their respective officers,
directors, employees, agents, advisors and representatives (including Persons
who have signed documents or certificates pursuant to Section 5.23(a)(ii)
or (vii)) shall be indemnified and held harmless by Rank Group from and
against any and all liabilities, losses, damages, claims, costs, expenses,
interest, awards, judgments and penalties suffered or incurred by them in connection
with the Debt Financing (other than to the extent such losses arise from the
willful misconduct of the Sellers, any of their Subsidiaries or their
respective officers, directors, advisors and representatives). Sellers and Rank
Group hereby agree that if any indemnification under this Section 5.23(c) is
judicially determined to be unavailable for any reason, then Rank Group will
contribute to the liabilities, losses, damages, claims, costs, expenses,
interest, awards, judgments and penalties for which such indemnification is
held unavailable in such proportion as is appropriate to reflect the
relative benefits to Sellers, on the one hand, and Rank Group and Purchaser, on
the other hand, of the Debt Financing (other than to the extent such losses arise
from the willful misconduct of the Sellers, any of their Subsidiaries or their
respective officers, directors, advisors and representatives). No director,
officer or employee of the Sellers or, prior to the Effective Time, any
Transferred Entity shall be required to execute any document (except pursuant
to Section 5.23(a)(ii) or (vii)) or provide any corporate
approval or authorization in connection with the Debt Financing or any aspect
thereof.


          Section
5.24. Certain
Financial Information; Post-Closing Cooperation with Financing. 


                    (a)
Prior to the Closing, as soon as practicable following the Sellers’ public
earning release for a fiscal quarter, the Sellers shall deliver to Purchaser an
unaudited balance sheet and related statement of income and cash flows of the
Business, as of and for such fiscal quarter, commencing with the fiscal quarter
ended March 31, 2011, and for each fiscal quarter ended more than 60 days prior
to the Closing Date.


                    (b)
Prior to the Closing, within 30 days following the completion of any month
between December 2010 through and including the month prior to the month in
which the


67





Closing occurs, Sellers shall deliver to Purchaser copies of such
monthly financial reports regarding the Business as they may prepare in the
ordinary course of business.


                    (c)
After the Closing and at any time prior to the first anniversary of the Closing
Date, the Sellers shall, and shall cause each of their Subsidiaries to, use
their commercially reasonable efforts to cause their and each of their
Subsidiaries’ representatives to, upon any Purchaser request (it being
understood that Purchaser shall bear all reasonable third-party costs and
out-of-pocket expenses of Sellers incurred pursuant to this Section 5.24(c)),
reasonably cooperate and assist Purchaser with Purchaser’s preparation of
financial statements for any of the Prestone, FRAM, Autolite and Holt segments
of the Business in connection with any possible refinancing of the Debt Financing,
recapitalization or similar restructuring or transfer or sale of all or part of
the Business. Such cooperation and assistance shall include, at the reasonable
request of Purchaser,


                              (i)
using commercially reasonable efforts to furnish Purchaser with any supporting
data and information, to the extent it is available to the Sellers, or access
to personnel necessary for Purchaser to prepare (x) audited balance sheets and
related statements of income and cash flows of the portion or portions of the
Business described in such request for the fiscal years ended December 31,
2008, December 31, 2009 and December 31, 2010, such financial statements to be
prepared in accordance with GAAP and to be audited and accompanied by a report
and opinion of PricewaterhouseCoopers LLP or an independent certified public
accountant reasonably acceptable to Purchaser, (y) unaudited balance sheets for
such portion or portions of the Business described in such request and related
statements of income and cash flows for (I) the four quarters of each of 2009
and 2010, and (II) each calendar quarter ending after the date hereof and prior
to the Closing Date and (z) an audited balance sheet for such portion or
portions of the Business described in such request as of the Closing Date and
related statements of income and cash flows for the period from January 1, 2011
through the Closing Date; 


                              (ii)
using commercially reasonable efforts to furnish Purchaser and its financing
sources as promptly as practicable with financial or other pertinent
information, to the extent it is available to the Sellers, regarding such
portion or portions of the Business as may be reasonably requested by
Purchaser, including (to the extent available to the Sellers) audit reports and
other information to facilitate the preparation of financial statement and
related data regarding such portion or portions of the Business of the type and
form customarily included in an offering memorandum for private placements of
non-convertible high-yield bonds under Rule 144A promulgated under the
Securities Act, or required by Regulation S-X and Regulation S-K promulgated
under the Securities Act for a registered offering of non-convertible debt
securities or otherwise necessary to receive from PricewaterhouseCoopers LLP
(and any other accountant to the extent financial statements audited or
reviewed by such accountants are or would be included in such offering
memorandum) customary “comfort” (including “negative assurance” comfort), with
respect to the financial statements described in Section 5.24(c)(i); and



                              (iii)
using commercially reasonable efforts to provide Purchaser and its financing
sources with financial and other pertinent information, to the extent available
to the Sellers, regarding such portion or portions of the Business during the
period of ownership by the Sellers (x) that is reasonably requested by the
financing sources of Purchaser or (y) that is 


68





reasonably required to enable Purchaser to prepare any schedule
describing the material qualitative and quantitative differences between the
financial statements prepared with respect to such portion or portions of the
Business in accordance with GAAP and financial statements prepared in
accordance with International Financial Reporting Standards (including by
providing any required supporting data). 


                    (d)
The Sellers and their Affiliates, Subsidiaries, and their respective officers,
directors, employees, agents, members, partners, managers, advisors and
representatives shall be indemnified and held harmless by Purchaser from and
against any and all liabilities, losses, damages, claims, costs, expenses,
interest, awards, judgments and penalties suffered or incurred by them in
connection with the provision of the information contemplated by Section
5.24(c) or otherwise in connection with any refinancing of the Debt
Financing, recapitalization or similar restructuring of all or part of the
Business or transfer or sale of all or part of the Business contemplated by Section
5.24(c) (other than to the extent such losses arise from the willful
misconduct of the Sellers, any of their Subsidiaries, Affiliates or their
respective officers, directors, employees, agents, members, partners, managers,
advisors and representatives). No director, officer or employee of the Sellers
shall be required to execute any document or provide any corporate approval or
authorization in connection with any transactions contemplated under Section
5.24(c). 


          Section
5.25. Termination
of Outstanding Powers of Attorney. On the Closing Date, Sellers
shall cause to be delivered to Purchaser evidence of termination of the
outstanding powers of attorney executed on behalf of the Transferred Entities
to be transferred on the Closing Date and identified by Purchaser prior to the
Closing Date.


          Section
5.26. Rank
Group Guarantee. 


                    (a)
Rank Group hereby unconditionally and irrevocably guarantees and promises to Honeywell,
in order to induce Honeywell to enter into this Agreement (i) the due
and punctual payment by Purchaser of the Purchase Price and any other amounts
payable by Purchaser to Sellers at Closing pursuant to this Agreement when and
to the extent the same shall become due and payable at Closing, and (ii)
any Losses payable by Purchaser as a result of any breach by Purchaser of any
of its obligations contained herein (collectively, the “Obligations”). The
Obligations under this guaranty shall constitute an absolute and unconditional,
present and continuing guarantee of payment and performance to the extent
provided herein and not of collectability, and shall not be contingent upon any
attempt by Honeywell to enforce payment or performance by Purchaser. It is
acknowledged and agreed that this guarantee will expire and will have no
further force or effect, and the Sellers will have no rights hereunder, in the
event that the Closing occurs. 


                    (b)
The Obligations under this guaranty are absolute and unconditional, are not
subject to any counterclaim, setoff, deduction, abatement or defense based upon
any claim Rank Group may have against the Sellers (other than those that would
be available to Purchaser hereunder if a claim had been asserted against
Purchaser rather than Rank Group), and shall remain in full force and effect
through the Effective Time without regard to (i) any agreement or
modification to any of the terms of this Agreement, the Transaction Documents
or any other agreement which may hereafter be made relating thereto; (ii)
any exercise, non-exercise or


69





waiver by any Seller of any right, power, privilege or remedy under or
in respect of this Agreement; (iii) any insolvency, bankruptcy,
dissolution, liquidation, reorganization or the like of Purchaser or Rank Group
at any time or (iv) absence of any notice to, or knowledge by, Rank
Group of the existence or occurrence of any of the matters or events set forth
in the foregoing subdivisions (i) through (iii). 


                    (c)
Rank Group unconditionally waives (i) any and all notice of default,
non-performance or non-payment by Purchaser, in each case, to the extent notice
of same has been provided to Purchaser in accordance with this Agreement, (ii)
all notices which may be required by statute, rule of law or otherwise to
preserve intact any rights of Sellers against Rank Group, including, without
limitation, any demand, presentment or protest, or proof of notice of
non-payment under this Agreement, and (iii) any right to the
enforcement, assertion or exercise by Sellers of any right, power, privilege or
remedy conferred in this Agreement or otherwise.


          Section
5.27. Holt Lloyd SA. As soon as reasonably practicable following the Closing, Sellers
shall amend the organizational documents of Holt Lloyd SA, a Spanish limited company (“Holt Lloyd Spain”), such that its name does not
include “Holt Lloyd”
or “Holt.” Effective as of such amendment, Holt Lloyd Spain, as well as any other entities retained by Sellers, shall
cease using the name “Holt Lloyd”
or “Holt” in any manner, including as a trade name, business name or a/k/a. 


ARTICLE VI


CONDITIONS TO OBLIGATIONS OF PURCHASER


          The
obligations of Purchaser to be performed by Purchaser at the Closing are
subject to the satisfaction at or prior to each of the following conditions,
unless waived by Purchaser in its sole discretion.


          Section
6.1. Absence
of Injunction. No injunction shall have been issued by any court of
competent jurisdiction and be in effect that prohibits or enjoins in any
respect the consummation of, the transactions contemplated by this Agreement.


          Section
6.2. Deliveries
of Sellers. Purchaser shall have received all certificates,
instruments, agreements and other documents to be delivered on or before the
Closing Date pursuant to Section 2.3(a).


          Section
6.3. No
Breach. Each representation and warranty of Honeywell contained in
this Agreement shall have been true and correct as of the date hereof and the
representations and warranties of Honeywell in Sections 3.1, 3.2,
3.3, 3.10 (other than in the representations in clauses (a)(ii)
and (c)(iv)), the last sentence of Section 3.15, 3.16
and 3.19, shall be true and correct as of the Closing as though such
representation and warranty was made on and as of such time (except to the
extent a different date is specified therein, in which case such representation
and warranty shall be true and correct as of such date), except, in each case,
where the failure to be so true and correct (without giving effect to any
“materiality” (including the word “material”) or “Business Material Adverse
Effect” qualifiers) would not, individually or in the aggregate, (i) in the
case of the Seller Fundamental Representations and Warranties, be material, and
(ii) in the


70





case of all other representations and warranties of Honeywell, have a
Business Material Adverse Effect. Each covenant and agreement of each Seller
required by this Agreement to be performed by it at or prior to the Closing
will have been duly performed and complied with in all material respects as of
the Closing.


          Section
6.4. Antitrust
and Foreign Investment Clearances; Certain Litigation. Any approvals
or conditions of clearance under the antitrust Law or the foreign investment
Law of any jurisdiction required to consummate the transactions contemplated
hereby shall have been met or obtained and any waiting period (and any extension
thereof) under the HSR Act or other antitrust Law or the foreign investment
Laws set forth on Schedule 6.4 applicable to the purchase of the
Purchased Assets shall have expired or shall have been terminated. No
Governmental Authority shall have enacted any Law or issued an order, decree or
ruling or taken any other action permanently or temporarily restricting,
enjoining or otherwise prohibiting in any material respect the transactions
contemplated by this Agreement. 


          Section
6.5. No
Business Material Adverse Effect. No Business Material Adverse
Effect shall have occurred after the date of this Agreement and be continuing
as of the Closing Date.


          Section
6.6. Marketing
Period. Unless Purchaser shall have received at least $650,000,000
in net proceeds of
debt incurred for the purpose of financing the transactions contemplated by this
Agreement, the Marketing Period shall have occurred and been completed.


          Section
6.7. Closing
Certificate. Honeywell shall have delivered to Purchaser a
certificate executed by an authorized officer of Honeywell certifying as to
compliance with the matters described in Section 6.3.


ARTICLE VII


CONDITIONS TO OBLIGATIONS OF SELLERS


          The
obligations of Sellers to be performed by Sellers at the Closing are subject to
the satisfaction at or prior to the Closing of each of the following conditions,
unless waived by Sellers in their sole discretion:


          Section
7.1. Absence
of Injunction. No injunction shall have been issued by any court of
competent jurisdiction and be in effect that prohibits or enjoins in any
respect the consummation of, the transactions contemplated by this Agreement.


          Section
7.2. Deliveries
of Purchaser. Sellers shall have received the Purchase Price as
required under Section 1.6 and all certificates, instruments,
agreements and other documents to be delivered on or before the Closing Date
pursuant to Section 2.3(b).


          Section
7.3. No
Breach. Each representation and warranty of Purchaser contained in
this Agreement shall have been true and correct when made and shall be true and
correct in all material respects as of the Closing as though such
representation and warranty was made on and as of such time (except to the
extent a different date is specified therein, in which case such


71





representation and warranty shall be true and correct as of such date).
Each covenant and agreement of Purchaser required by this Agreement to be
performed by it at or prior to the Closing will have been duly performed and
complied with in all material respects as of the Closing.


          Section
7.4. Antitrust
and Foreign Investment Clearances; Certain Litigation. Any approvals
or conditions of clearance under the antitrust Law or foreign investment Law of
any jurisdiction required to consummate the transactions contemplated hereby
shall have been met or obtained and any waiting period (and any extension
thereof) under the HSR Act or other antitrust Law or foreign investment Laws
set forth on Schedule 6.4 applicable to the purchase of the Purchased
Assets shall have expired or shall have been terminated. No Governmental
Authority shall have enacted any Law or issued an order, decree or ruling or
taken any other action permanently or temporarily restricting, enjoining or
otherwise prohibiting in any material respect the transactions contemplated by
this Agreement.


          Section
7.5. Closing
Certificate. Purchaser shall have delivered to Honeywell a
certificate executed by an authorized officer of Purchaser certifying as to
compliance with the matters described in Section 7.3.


ARTICLE VIII


TERMINATION; EFFECT OF TERMINATION


          Section
8.1. Termination.
Notwithstanding anything to the contrary set forth herein, this Agreement may
be terminated and the transactions contemplated hereby abandoned at any time
prior to the Closing:


                    (a)
by mutual written consent of Purchaser and Honeywell;


                    (b)
by Purchaser or Sellers, if the transactions contemplated hereby are not
consummated on or before October 31, 2011 (the “Deadline”); provided that if, as of the
Deadline, all conditions to this Agreement shall have been satisfied or waived
other than (i) those conditions that by their terms are to be satisfied by
deliveries at the Closing and (ii) the conditions set forth in Section 6.4
or Section 7.4 due to the failure to receive any required consent or
clearance under applicable antitrust Laws or the foreign investment Laws set
forth on Schedule 6.4 from a Governmental Authority of competent
jurisdiction or any action by any Governmental Authority of competent
jurisdiction to prevent the transactions contemplated by this Agreement, then
Purchaser or the Sellers may extend the Deadline to December 31, 2011, in which
case the Deadline shall be deemed to be for all purposes such date; provided,
further, however, that the right to terminate this Agreement or
to extend the Deadline under this Section 8.1(b) shall not be available
to any party whose material breach of a covenant or agreement contained in this
Agreement caused such failure or incapacity to consummate the transactions
contemplated by the Deadline (in the case of the right to terminate the
Agreement) or such failure to receive
any required consent or clearance under applicable antitrust Laws or the
foreign investment Laws set forth on Schedule 6.4 (in the case of the
right to extend the Deadline);


72





                    (c)
if any Governmental Authority having jurisdiction over any of the parties
hereto (including any Seller) shall have issued an order, decree or ruling or
taken any other action, in each case permanently enjoining or otherwise
prohibiting the consummation of the transactions contemplated hereby, and such
order, decree, ruling or other action shall have become final and
nonappealable; or


                    (d)
by Purchaser, on the one hand, or Honeywell, on the other, if there has been a
material breach on the part of Honeywell or any Seller, on the one hand, or
Purchaser, on the other, of the representations and warranties or covenants set
forth in this Agreement (provided that such breach is not the result of any
breach of any covenant, representation or warranty of any other party to this
Agreement), which breach has not been cured within thirty (30) days following
receipt of written notice of such breach, and such breach renders the
conditions set forth in Article VI or Article VII, as the case
may be, incapable of being satisfied.


          Section
8.2. Effect
of Termination. If this Agreement is terminated pursuant to Section 8.1,
this Agreement shall become null and void and of no further force and effect,
and none of the parties hereto (nor their respective Subsidiaries, Affiliates,
directors, shareholders, officers, employees, agents, consultants, attorneys in
fact or other representatives) shall have any liability in respect of such
termination; provided, however, that no termination of this
Agreement shall relieve any party from liability for any willful breach of this
Agreement prior to such termination. The provisions of this Section 8.2
and Article VIII shall survive any termination of this Agreement.
For purposes of this Agreement, “willful breach” means a material breach that
(a) is a consequence of an act undertaken or omitted by a party with the
knowledge (actual or constructive) that the taking or omitting of such act
would, or would be reasonably expected to, cause a breach of this Agreement and
(b) would prevent or materially delay the Closing or give another party to this
Agreement the right not to consummate the transactions contemplated thereby. 


ARTICLE IX


SURVIVAL; INDEMNIFICATION


          Section
9.1. Survival
of Representations, Warranties and Agreements. The representations
and warranties of the parties contained in Articles III and IV,
shall, subject to the proviso to this sentence, terminate on the date that is
18 months after the Closing Date, provided, however, that (i) the
representations and warranties in Sections 3.1, 3.2, 3.3
and 3.19, and in Section 4.1, 4.2 and 4.7,
shall survive indefinitely and (ii) the representations and warranties in Section 3.7
shall survive until thirty (30) days following the expiration of the applicable
statute of limitation in question (the representations of Honeywell described
in clause (i), the “Seller Fundamental Representations and Warranties”
and each a “Seller Fundamental Representation and Warranty”). All covenants
and agreements contained herein which by their terms are required to be
performed or complied with prior to the Closing (each, a “Pre-Closing Covenant”) shall
survive the Closing Date for a period of twelve (12) months from the Closing
Date, and all other respective covenants and agreements of contained herein, as
well as Pre-Closing Covenants to the extent they contemplate performance
following the Closing, shall survive the Closing and remain in full force and
effect in accordance with their terms, provided, that all covenants and
agreements contained in this Agreement relating to Taxes shall survive the 


73





Closing and remain in full force and effect in accordance with their
terms. The period of time a representation or warranty or covenant or agreement
survives the Closing pursuant to this Section 9.1 shall be the “Survival
Period” with respect to such representation or warranty or covenant
or agreement. In the event notice of any claim for indemnification under this Article IX
shall have been given within the applicable Survival Period and such claim has
not been finally resolved by the expiration of such Survival Period, the
representations or warranties or covenants or agreements that are the subject
of such claim shall survive, but only to the extent and, if known, in the amount of, such claim, until
such claim is finally resolved.


          Section
9.2. Indemnification.
Subject to the terms, conditions and limitations set forth in this Article IX,
from and after the Closing Date:


                    (a)
Honeywell shall, indemnify and hold harmless Purchaser and its Affiliates and
each of their respective officers, directors, members, partners, managers,
employees, agents, successors and assigns (collectively, the “Purchaser
Indemnified Parties”) from and against any Losses, whether or not
arising from a third party claim, arising out of or in connection with
(i) any breach of any representation or warranty made by Sellers in Article III
as of the date of the Agreement or the breach as of the Closing Date of the
representations and warranties of Honeywell in Sections 3.1, 3.2,
3.3, 3.4, 3.10 (other than in the representations in
clauses (a)(ii) and (c)(iv)), the last sentence of Section 3.15,
3.16 and 3.19 and (ii) any failure to perform any covenant
or agreement of Sellers set forth in this Agreement, (iii) the Retained
Liabilities, or (iv) the Pre-Closing Environmental Liabilities.


                    (b)
Purchaser shall indemnify and hold harmless Honeywell, each Seller and
their Affiliates and each of their respective officers, directors, members,
partners, managers, employees, agents, successors and assigns (collectively,
the “Seller
Indemnified Parties”) from and against any Losses, whether or not
arising from a third party claim, arising out of (i) any breach of any
representation or warranty made by Purchaser in Article IV as of
the date hereof and as of the Closing Date, (ii) any failure to perform
any covenant or agreement of Purchaser set forth in this Agreement or
(iii) the Assumed Liabilities; provided, that this Section 9.2(b)
shall not limit Purchaser’s right to make a claim under Section 9.2(a). 


          Section
9.3. Indemnification
Procedures.


                    (a)
In order for a party (the “Indemnified Party”) to be entitled to any
indemnification provided for under this Article IX in respect of a
claim made against the Indemnified Party by any Person who is not a party to
this Agreement (a “Third-Party Claim”), such Indemnified Party
must notify the indemnifying party hereunder (the “Indemnifying Party”) in
writing of the Third-Party Claim promptly following receipt by such Indemnified
Party of notice of the Third-Party Claim; provided, however, that
failure to give such notification shall not affect the indemnification provided
hereunder except to the extent the Indemnifying Party shall have been actually
prejudiced as a result of such failure. Thereafter, the Indemnified Party shall
deliver to the Indemnifying Party, promptly following the Indemnified Party’s
receipt thereof, copies of all notices and documents (including court papers)
received by the Indemnified Party relating to the Third-Party Claim, other than
those notices and documents separately addressed to the Indemnifying Party.


74





                    (b)
The Indemnifying Party will have the right to defend against, negotiate, settle
or otherwise deal with any Third-Party Claim which relates to any Losses
indemnifiable hereunder and to select counsel of its choice. If the
Indemnifying Party (i) does not within 20 business days of its receipt of
notice of a Third-Party Claim pursuant to Section 9.3(a) elect to
defend against or negotiate any Third-Party Claim which relates to any Losses
indemnifiable hereunder or (ii) after assuming such control fails to diligently
defend against such Third-Party Claim in good faith, then the applicable
Indemnified Party may defend against, negotiate, settle or otherwise deal with
such Third-Party Claim with counsel reasonably acceptable to the Indemnifying
Party. If the Indemnifying Party assumes the defense of any Third-Party Claim,
the applicable Indemnified Party may participate, at its own expense, in the
defense of such Third-Party Claim; provided that if there exists or is
reasonably likely to exist a conflict of interest that would make it
inappropriate in the judgment of the Indemnified Party in its reasonable
discretion for the same counsel to represent both the Indemnified Party and the
Indemnifying Party, then the Indemnified Party shall be entitled to retain one
counsel reasonably acceptable to the Indemnifying Party at the expense of the
Indemnifying Party.


                    (c)
If the Indemnifying Party chooses to defend or prosecute a Third-Party Claim,
the Indemnified Party shall (and shall cause the applicable Indemnified Parties
to) cooperate in the defense or prosecution thereof and make available to the
Indemnifying Party, at the Indemnifying Party’s expense, all witnesses,
pertinent records, materials and information in the Indemnified Party’s
possession or under the Indemnified Party’s control relating thereto as is
reasonably required by the Indemnifying Party. Similarly, if the Indemnified
Party is defending or prosecuting such Third-Party Claim, the Indemnifying
Party shall (and shall cause the applicable Indemnified Parties to) cooperate
in the defense or prosecution thereof and make available to the Indemnified
Party, at the Indemnifying Party’s expense, all such witnesses, records,
materials and information in the Indemnifying Party’s possession or under the
Indemnifying Party’s control relating thereto as is reasonably required by the
Indemnified Party. If the Indemnifying Party chooses to defend or prosecute a
Third-Party Claim, no such Third Party-Claim may be settled, compromised or
discharged by the Indemnifying Party without the prior written consent of the
Indemnified Party (which shall not be unreasonably withheld or delayed), unless
any such settlement, compromise or discharge (i) obligates the Indemnifying
Party (or its Affiliates) to pay the full amount of the Loss in connection with
such Third-Party Claim, (ii) imposes no injunctive or other equitable relief
against any Indemnified Party, and (iii) unconditionally releases all
Indemnified Parties from all further liability in respect of such Third-Party Claim.
If the Indemnifying Party elects not to assume the defense of a Third-Party
Claim or is not permitted to assume such defense, the applicable Indemnified
Parties shall not admit any liability with respect to, or settle, compromise or
discharge, such Third-Party Claim without the Indemnifying Party’s prior
written consent (which shall not be unreasonably withheld or delayed).


                    (d)
Any Third Party Claim relating to Taxes shall be governed by Section 5.15(e).



                    (e)
In the event any Indemnified Party should have a claim against any Indemnifying
Party under this Article IX that does not involve a Third-Party
Claim, the Indemnified Party shall deliver notice of such claim to the
Indemnifying Party promptly following a management level employee, with
supervisory responsibility for the subject matter 


75





of the claim, of the Indemnified Party (or its Subsidiaries) acquiring
actual knowledge of the same. The failure by any Indemnified Party to so notify
the Indemnifying Party shall not relieve the Indemnifying Party from any
liability that it may have to such Indemnified Party under this Article IX,
except to the extent that the Indemnifying Party has been actually prejudiced
by such failure.


                    (f)
The Indemnified Party shall take, and shall cause its respective Affiliates to
take, all reasonable steps to mitigate or otherwise minimize any Losses that
form the basis of a claim for indemnification under this Article IX.


                    (g)
For the avoidance of doubt, the Indemnified Party shall notify the Indemnifying
Party with respect to any claim (other than any claim involving a De Minimis
Loss) as to which indemnification is sought hereunder even though the amount
thereof plus the amount of other claims previously notified by the Indemnified
Party in aggregate is less than the Threshold Amount.


          Section
9.4. Indemnification
Limitations.


                    (a)
In no event shall Honeywell be liable for indemnification pursuant to Section 9.2(a)(i)
and Section 9.2(a)(iv) unless and until the aggregate amount of all
Losses with respect to Section 9.2(a)(i) and Section 9.2(a)(iv)
that are imposed on or incurred by Purchaser exceeds 1% of the Purchase Price
(the “Threshold
Amount”), in which case Purchaser shall be entitled to
indemnification for all Losses in excess of the Threshold Amount; provided,
however, that the limitation set forth in this sentence shall not apply
with respect to any claim for indemnification in respect of any breach of a Seller
Fundamental Representation and Warranty, and provided further
that in no event shall Honeywell be liable for indemnification pursuant to Section
9.2(a)(i) with respect to breaches of Seller Fundamental Representations
and Warranties for any Losses in excess of the Purchase Price. Notwithstanding
the foregoing, Honeywell shall not (x) be required to make payments for
indemnification pursuant to Section 9.2(a)(i) and Section
9.2(a)(iv) in an aggregate amount in excess of 11.25% of the Purchase Price
or (y) be liable for indemnification with respect to any Loss by an Indemnified
Party of less than $125,000 or, with respect to a claim under Section 3.11
or Section 9.2(a)(iv), $150,000, for each individual matter for which a
claim is made hereunder (each, a “De Minimis Loss”) and all such Losses shall
be disregarded and shall not be aggregated for purposes of the Threshold
Amount; provided, however, that the limitations set forth in
clauses (x) and (y) of this sentence shall not apply with respect to any
claim for indemnification in respect of any Seller Fundamental Representation
and Warranty.


                    (b)
In calculating amounts payable to an Indemnified Party hereunder, the amount of
any indemnified Losses shall be determined without duplication of any other
Loss for which an indemnification claim has been made under any other
representation, warranty, covenant or agreement, shall be determined without
giving effect to any “materiality” (including the word “material”) or “Business
Material Adverse Effect” limitations or qualifications set forth in any
representations and warranties of the parties made in this Agreement (other
than clause (ii) of Section 3.6(a)) (but for the avoidance of doubt such
materiality and Business Material Adverse Effect qualifications shall be
considered for purposes of determining whether a breach of a representation has
occurred) and shall be computed net of (i) amounts actually recovered by 


76





the Indemnified Party under indemnification agreements or arrangements
with third parties or under any insurance policy with respect to such Losses
(each, a “Collateral
Source”), (ii) any actual prior recovery by the Indemnified Party
from any Person with respect to such Losses and (iii) any reserves set
forth in the Closing Statement specifically for such Loss. In the event of any
indemnification claim paid, the Indemnifying Party may, in its sole discretion,
require any Indemnified Party to grant to such Indemnifying Party an assignment
of the right of such Indemnified Party to assert a claim against any Collateral
Source. If the amount to be netted hereunder from any payment required under Article IX
is determined after payment of any amount otherwise required to be paid to an
Indemnified Party under this Article IX, the Indemnified Party
shall repay to the Indemnifying Party, promptly after such determination, any
amount that the Indemnifying Party would not have had to pay pursuant to this Article IX
had such determination been made at the time of such payment. 


                    (c)
Notwithstanding any other provision of this Agreement other than Section
5.15(a), in no event shall Honeywell or any Seller be liable for (i) any
punitive damages or any damages that are not reasonably foreseeable or that are
speculative or remote, unless, in each case, such damages are recovered by a
third party in a Third Party Claim pursuant to an order entered against a
Purchaser Indemnified Party or in a settlement agreement to which a Purchaser
Indemnified Party is a party or (ii) any Losses to the extent arising from any Environmental Investigation
voluntarily conducted by the Purchaser or any Transferred
Entity or any third party acting on their behalf after the Closing, including
Environmental Investigations voluntarily conducted in connection with
operational changes or incident to construction activities, unless an
Environmental Investigation is required by a Governmental Authority, required
pursuant to applicable Environmental Laws, or conducted in connection with an
Environmental Claim, provided, that Sellers shall not be liable
for Losses to the extent resulting from Environmental Investigations conducted
in connection with closure activities, except for Environmental Investigations
performed in connection with or as a result of closure activities at the
Fostoria, Ohio or Greenville, Ohio facilities. 


                    (d)
Purchaser acknowledges that the consents to the transactions contemplated by
this Agreement identified on Section 3.4 of the Disclosure Schedule may
be required from parties to Contracts, leases, licenses or other agreements to
which Honeywell, any Seller or any Transferred Entity is a party (including the
Material Contracts) and such consents have not been obtained and may not be
obtained. Purchaser agrees that neither Honeywell nor any Seller shall have any
liability (other than, if breached, under Sections 3.4, 5.1, or 5.5(b))
whatsoever to Purchaser (and Purchaser shall not be entitled to assert any
claims except as aforesaid) arising out of or relating to the failure to obtain
any consents that may have been or may be required in connection with the
transactions contemplated by this Agreement or, because of the default,
acceleration or termination of or loss of right under any such Contract, lease,
license or other agreement as a result thereof. Purchaser further agrees that
no representation, warranty or covenant of the Sellers contained herein (other
than, if breached, Sections 3.4, 5.1, or 5.5(b)) shall be
breached or deemed breached and (except as aforesaid) no condition of Purchaser
shall be deemed not to be satisfied as a result of the failure to obtain any
consent or as a result of any such default, acceleration or termination or loss
of right or any lawsuit, action, claim, proceeding or investigation commenced or
threatened by or on behalf of any Person arising out of or relating to the
failure to obtain any consent or any such default, acceleration or termination
or loss of right.


77





                    (e)
Except with respect to fraud, notwithstanding anything else contained in this
Agreement to the contrary, after the Closing, indemnification pursuant to the
provisions of this Agreement shall be the sole and exclusive remedy of the
parties from and after the Closing Date with respect to any and all claims arising
out of or in connection with this Agreement and the transactions contemplated
hereby, including in respect of any misrepresentation or breach of any
warranty, covenant or other provision contained in this Agreement or in any
certificate delivered pursuant hereto. Without limiting the generality or
effect of the foregoing, as a material inducement to the other parties hereto
entering into this Agreement, each party hereto hereby waives, from and after
the Closing, any claim or cause of action, known and unknown, foreseen and
unforeseen, which it or any of its Affiliates may have against the other
parties hereto (including rights to indemnification or contribution, or any
other rights or remedies), including under the common law or federal or state
securities Laws, trade regulation Laws or other Laws (including any relating to
Tax, environmental, real estate or employee matters), by reason of this
Agreement, the events giving rise to this Agreement and the transactions
provided for herein or contemplated hereby or thereby, except for claims or
causes of action brought under and subject to the terms and conditions of the
provisions contained in this Agreement and fraud. Nothing contained in this Section
9.4(e) shall in any manner limit the representations of the parties made in
Sections 3.23 and 4.7.


                    (f)
All payments made pursuant to this Article IX or any other
indemnification provision of this Agreement shall be deemed to be adjustments
to the Purchase Price.


                    (g)
The indemnity set forth in Section
9.2(a)(iv)  (Pre-Closing Environmental Liabilities) shall expire eighteen (18) months
after the Closing Date. In connection with any
indemnification claim made pursuant to Section 9.2(a)(iv) or Section
9.2(a)(i) with respect to breaches of the representations and warranties contained
in Section 3.11 (Environmental Matters), Purchaser
shall have the right to (i) obtain any tests and studies reasonably necessary
to define or delineate the extent of any contamination or noncompliance with
Environmental Laws, (ii) prepare the work plan for any Remedial Action or
correction of noncompliance, and (iii) conduct or direct any such Remedial
Action or correction of noncompliance. Purchaser shall notify the Sellers prior
to conducting any Remedial Action, promptly provide the Sellers with copies of
all environmental, engineering or other studies and data prepared by or
collected by Purchaser or its agents, consult with the Sellers regarding the
nature, extent and anticipated cost of such Remedial Action, provide the
Sellers with reasonable advance notice of and opportunity to attend meetings
with the applicable Governmental Authorities, and provide the Sellers with
copies of all correspondence with such Governmental Authorities. In connection
with any indemnification claim made pursuant to Section
9.2(a)(iii) (Retained Liabilities) with respect to Liabilities identified
in Sections 1.4(h) and (i), the Sellers shall have the right to
(i) obtain any tests and studies reasonably necessary to define or delineate
the extent of any contamination or noncompliance with Environmental Laws, (ii)
prepare the work plan for any Remedial Action or correction of noncompliance,
(iii) conduct or direct any such Remedial Action or correction of
noncompliance, and (iv) record and implement Engineering and Institutional
Controls as necessary to meet applicable industrial standards regarding the
presence of Materials of Environmental Concern, so long as such Engineering and
Institutional Controls are acceptable to the Governmental Authority with
jurisdiction over the Remedial Action and do not unreasonably interfere with
the use of any property for commercial or industrial purposes. The Sellers
shall


78





notify Purchaser prior to conducting any Remedial Action, promptly
provide Purchaser with copies of all environmental, engineering or other
studies and data prepared by or collected by the Sellers or their agents,
consult with Purchaser regarding the nature, extent and anticipated cost of
such Remedial Action, provide Purchaser with reasonable advance notice of and
opportunity to attend meetings with the applicable Governmental Authorities,
and provide Purchaser with copies of all correspondence with such Governmental
Authorities. Notwithstanding anything in this Section 9.4(g) to the
contrary, neither the Sellers nor their agents shall take any action that
unreasonably interferes with the operations of the Business or the Purchased
Assets. The Sellers shall only be liable for Remedial Action associated with
Pre-Closing Environmental Liabilities and with Retained Liabilities identified
in Sections 1.4(h) and (i) to the extent that Losses (A) are
required to bring the Business or any Purchased Assets into compliance with
applicable Environmental Laws, (B) are necessary to respond to the presence of
Materials of Environmental Concern exceeding applicable industrial standards, (C) meet the
requirements of a Governmental Authority or applicable Environmental Laws, or (D) utilize the
remedial criteria that are least stringent as required by applicable
Environmental Law and acceptable to the Governmental Authority with
jurisdiction over the Remedial Action.


                    (h)
In connection with any indemnification claim pursuant to Section 9.2(a)(iii)
with respect to Liabilities identified in Section 1.4(i) in connection
with the obligation to conduct Remedial Action pursuant to ISRA, (A) Sellers
and the Purchaser Indemnified Parties shall comply with all ISRA requirements,
as amended by the Site Remediation Reform Act, N.J.S.A. 58:10C-1 et seq. (“SRRA”), and the regulations promulgated
thereunder. Sellers shall be entitled to
engage a Licensed Site Remediation Professional as defined at N.J.A.C.
7:26C-1.3 (“LSRP”) and obtain
a Response Action Outcome, as defined in the SRRA, applicable to the Property
pursuant to ISRA (collectively, “RAO”)
or, if Sellers do not obtain the RAO prior to Closing, Sellers shall obtain or otherwise complete and duly file
on or before Closing (i) a Remediation Certification in accordance with N.J.A.C.
7:26B-4.3, or (ii) such other authorization which permits Sellers to complete
this transaction (collectively, a “Closing
Approval”) provided, in each case, such Closing Approval does not
create any liability or obligation on the part of the Purchaser Indemnified
Parties other than the duty to cooperate. The Purchaser Indemnified
Parties shall grant Sellers, their agents and the New Jersey Department of
Environmental Protection (“NJDEP”)
a non-exclusive license to enter the Purchased Owned Real Property in Freehold,
New Jersey, following Closing, upon reasonable notice, in order to conduct any
investigation, sampling or remediation necessary in order to secure the RAO. Sellers, in Sellers’ discretion, may choose any
remedial alternative which will result in an RAO, including the least costly and most restrictive alternative so
long as such remedial alternative is acceptable to the NJDEP and does not
unreasonably limit use of the Purchased Owned Real Property in Freehold,
New Jersey. Seller shall be entitled to
rely upon the use of Engineering and Institutional Controls, including deed
notices, caps, and/or clean fill over contaminated soil, in connection with any
such remediation as permitted by applicable statutes and regulations, provided,
however, any such Engineering and Institutional Controls shall not unreasonably
interfere with the use of such property for commercial or industrial
purposes. Seller shall post,
maintain, and from time-to-time adjust the amount of, financial assurances
required pursuant to ISRA, if any. The Purchaser Indemnified Parties shall
assume all future obligations related to the Engineering and Institutional
Controls and any maintenance requirements required under ISRA, it being
understood that the Purchaser Indemnified Parties shall have no obligation to


79





conduct any investigation, remediation or corrective action required
under ISRA, the SRRA, the Technical Requirements for Site Remediation, N.J.A.C.
7:26E, the Administrative Requirements for the Remediation of Contaminated
Sites, N.J.A.C. 7:26C, and/or other applicable statute or regulation.


                    (i)
In connection with any indemnification claim pursuant to Section 9.2(a)(iii)
with respect to Liabilities identified in Section 1.4(i) in connection
with the obligation to conduct any Environmental Investigation or Remedial
Action pursuant to Connecticut General Statutes (“C.G.S.”) § 22a-134 et. seq.,
as amended by Public Act 01-204) (“Connecticut Property Transfer Law”), (A)
Sellers and the Purchaser Indemnified Parties shall comply with all Connecticut
Property Transfer Law requirements, and the regulations promulgated thereunder.
Sellers in their discretion shall be entitled to determine whether the Business
Leased Real Properties located in Danbury, Connecticut (“Danbury Facilities”) are
subject to the Connecticut Property Transfer Law. Should Sellers determine that
the Danbury Facilities are subject to the Connecticut Property Transfer Law,
Sellers shall file an Environmental Conditions Assessment Form, as defined at
C.G.S. §22a-134(17) and shall in their discretion determine whether to file a
Connecticut Property Transfer Program Form I, II, III, or IV, as defined at
C.G.S. §22a-134(10), (11), (12), and (13) respectively, with the Connecticut
Department of Environmental Protection (“CTDEP”). Sellers shall, if necessary, be
entitled to engage a Licensed Environmental Professional (“LEP”) as defined at C.G.S. §
22a-134(16) in order to file either a Form II, Form III, or Form IV. Should
Sellers determine that a Form I or Form II filing is appropriate, Sellers shall
notify Purchaser Indemnified Parties of the filing as required under the
Connecticut Property Transfer Law. Should CTDEP fail to approve of Sellers’
filing of either a Form I or Form II, Purchaser Indemnified Parties shall grant
Sellers, their agents and CTDEP a non-exclusive license to enter the Danbury
Facilities following Closing, upon reasonable notice, in order to conduct any
investigation, sampling, or remediation necessary in order to secure CTDEP approval
of the Form I or Form II filing. Should Sellers determine that either a Form
III or Form IV filing is appropriate, Purchaser Indemnified Parties shall grant
Sellers, their agents and CTDEP a non-exclusive license to enter the Danbury
Facilities following Closing, upon reasonable notice, in order to conduct any
investigation, sampling, or remediation necessary or desirable in order to
secure CTDEP approval that Remedial Actions specified in the Form III or Form
IV filing, or Remedial Actions required by CTDEP in order for Sellers to meet
all Connecticut Property Transfer Law and CTDEP requirements subsequent to the
Form III or Form IV filing. Sellers, in Sellers’ discretion, may choose any
remedial alternative which will result in CTDEP approval of a Form I, Form II,
Form III, or Form IV filing, including the least costly and most restrictive
alternative, as long as such remedial alternative is acceptable to the CTDEP
and does not unreasonably limit use of the Danbury Facility for commercial or
industrial purposes. Sellers shall be entitled to rely upon the use of
Engineering and Institutional Controls, including deed notices, caps, and/or
clean fill over contaminated soil, in connection with any such remediation as
permitted by applicable statutes and regulations, provided, however,
any such remedial alternative and Engineering and Institutional Controls shall
not unreasonably interfere with the ability of Purchaser Indemnified Parties to
utilize the Danbury Facilities for commercial or industrial purposes; and (B)
the Purchaser Indemnified Parties hereby agree to comply with all restrictions
and requirements as contained in any permitted Engineering and Institutional
Controls utilized by Sellers in connection with Sellers’s efforts to obtain
CTDEP approval of Form I, Form II, Form III, or


80






Form IV filings (which shall constitute Permitted Encumbrances). The
Purchaser Indemnified Parties shall assume all future obligations related to
the Engineering and Institutional Controls and any maintenance, monitoring, or
reporting requirements required under the Connecticut Property Transfer Law
and/or other applicable regulation, it being understood that the Purchaser
Indemnified Parties shall have no obligation to conduct any investigation,
remediation, or corrective action required under the Connecticut Property
Transfer Law and/or other applicable statute or regulation.


                    (j)
Notwithstanding any other provision of Section 9.4, in no event shall
Honeywell be liable for any Losses associated with Pre-Closing Environmental
Liabilities or any breach or inaccuracy of any representation or warranty
contained in Section 3.11 (Environmental Matters) to the extent such
Loss or Losses (i) arise from or are exacerbated by any of the Purchaser
Indemnified Parties after Closing, in connection with (A) any Management of any
Materials of Environmental Concern by the Purchaser Indemnified Parties; (B)
failure by the Purchaser Indemnified Parties following the Closing to comply
with any Environmental Law; and (C) the negligent actions of any Purchaser
Indemnified Parties or (ii) relate to a Remedial Action that (x) is not
required by a Governmental Authority or pursuant to any Environmental Law or
(y) is required by a cleanup or remediation standard other than an industrial
standard, unless such other cleanup or remediation standard is required by the
Governmental Authority with jurisdiction over the Remedial Action.


          Section
9.5. No
Rights of Offset. Purchaser waives and relinquishes any and all
rights to set off or to apply any monies held or indebtedness or other
obligations now or hereafter owing by Purchaser to Sellers or any of their
Affiliates against any obligations of Sellers or any of their Affiliates now or
hereafter existing under this Agreement or any other agreement, instrument, certificate
or similar document required to be delivered pursuant to this Agreement.


ARTICLE X


MISCELLANEOUS


          Section
10.1. Notices.
All notices and other communications given or made pursuant hereto shall be in
writing and shall be deemed to have been duly given or made (a) on the
date of delivery if delivered personally, or by telecopy or facsimile, upon
confirmation of receipt (if received on a business day or, if not received on a
business day, on the first business day following such date of receipt),
(b) on the first business day following the date of dispatch if delivered
by a recognized next-day courier service, or (c) on the fifth business day
following the date of mailing if delivered by registered or certified mail
return receipt requested, postage prepaid and shall be delivered personally or
mailed by registered or certified mail (postage prepaid, return receipt
requested), sent by overnight courier or sent by telecopy, to the applicable
party at the following addresses or telecopy numbers (or at such other address
or telecopy number for a party as shall be specified by like notice):


	
  

 	
  

 
	
  

 	
 if to
 Sellers:

 
	
  

 	
  

 
	
  

 	
 Honeywell
 International Inc.

 
	
  

 	
 101 Columbia
 Road 

 


81









	
  

 	
  

 	
  

 
	
  

 	
 P.O. Box
 4000

 
	
  

 	
 Morristown,
 New Jersey 07962-2487

 
	
  

 	
 Attention:
 General Counsel and Senior Vice President

 
	
  

 	
 Telecopy
 No.: (973) 455-4217

 
	
  

 	
  

 
	
  

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

 
	
  

 	
  

 
	
  

 	
 David
 Robbins, Esq.

 
	
  

 	
 Bingham
 McCutchen LLP

 
	
  

 	
 355 S. Grand
 Avenue, Suite 4400

 
	
  

 	
 Los Angeles,
 CA 90071

 
	
  

 	
 Telecopy No:
 (213) 680-6499

 
	
  

 	
  

 
	
  

 	
 If to
 Purchaser, to:

 
	
  

 	
  

 
	
  

 	
 Rank Group
 Limited

 
	
  

 	
 Level Nine

 
	
  

 	
 148 Quay
 Street

 
	
  

 	
 P.O. Box
 3515

 
	
  

 	
 Auckland,
 New Zealand

 
	
  

 	
 Facsimile
 No.: +612 9268 6694

 
	
  

 	
 Email:
 Helen.golding@rankgroup.co.nz

 
	
  

 	
  

 
	
  

 	
 with copies
 (which copies shall not constitute notice) to:

 
	
  

 	
 Debevoise
 & Plimpton LLP

 
	
  

 	
 919 Third
 Avenue

 
	
  

 	
 New York,
 New York 10022

 
	
  

 	
 Attention: 

 	
 Jeffrey J.
 Rosen

 
	
  

 	
  

 	
 Kevin M.
 Schmidt

 
	
  

 	
 Facsimile
 No.: (212) 909-6836

 
	
  

 	
 Email:
 jrosen@debevoise.com

 
	
  

 	
            kmschmidt@debevoise.com

 


          Section
10.2. Certain
Definitions; Interpretation.


                    (a)
For purposes of this Agreement, the following terms shall have the following
meanings:


          “Adjusted
Interim Cash Flow” means an amount, which may be either positive or
negative, equal to (i) the amount of Business EBITDA, minus (ii) the Deemed
Interest Adjustment, minus (iii) the Deemed Tax Adjustment, minus (iv) the
Working Capital Adjustment and minus (v) the amount of capital expenditures of
the Business during the period from and including the Measuring Time through
the Closing Date. To the extent any audit adjustments (including, for
illustrative purposes only, those of the type set forth on Schedule G)
have an impact on cash, then a corresponding adjustment will be made to
Adjusted Interim Cash 


82





Flow. Attached as Schedule H is an illustrative example of the
calculation of Adjusted Interim Cash Flow. Capital expenditures of the Business
shall be calculated in accordance with the Applicable Accounting Principles and
will be reduced by the proceeds of any sales of fixed assets or intangible
property, but for the avoidance of doubt, customer lifts will not be included
in the calculation of capital expenditures.


          “Affiliate”
of a Person 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.


          “Agreed
Interest Rate” means, (i) for the period from the Measuring Time
through and including March 31, 2011, 3%, (ii) for the period from and
including April 1, 2011 through and including June 30, 2010, 5%, (iii) for the
period from and including July 1, 2011 through and including September 30,
2011, 7% and (iv) thereafter, 9%.


          “Agreement”
shall have the meaning specified in the Preamble.


          “Antitrust
Agencies” shall have the meaning set forth in Section 5.5(a).


          “Applicable
Accounting Principles” means the GAAP principles, practices and
methodologies used in the preparation of the Year-End Financial Statements for
2009.


          “Assignment
and Assumption Agreement” shall have the meaning set forth in Section
2.3(a)(i).


          “Assumed
Business Taxes” means Taxes (other than Income Taxes)
of or payable with respect to the Business or the Purchased Assets (other than
a Transferred Entity) attributable to any Post-Reference Date Tax Period, to
the extent attributable to the normal operation of the Business (other than a
Transferred Entity) in the ordinary course, but excluding, for the avoidance of
doubt, Taxes that are attributable to the transfer of any asset under this
Agreement, the transfer of any Retained Assets or Transferred Entities Retained
Assets or any other transaction contemplated by this Agreement.


          “Assumed
Contracts” shall have the meaning set forth in Section 1.1(c)(vi).


          “Assumed
Liabilities” shall have the meaning set forth in Section 1.3.


          “Assumed Real
Property Leases” shall have the meaning set forth in Section 1.1(c)(vii).


          “Business”
shall mean Honeywell’s design, manufacture, marketing, distribution and sale of
Business Products, including the licensing of Business Intellectual Property
owned by Sellers or a Transferred Entity to third parties, conducted through
Honeywell’s “Consumer Products Group” business unit of its Transportation
Systems division, as conducted on the date hereof. For avoidance of doubt the
“Business” shall not include any Excluded Business.


          “Business
Adjustments” means the adjustments to Consolidated Operating Income
set forth on Schedule J.


83





          “Business Day”
or “business
day” shall mean a day other than a Saturday, Sunday or other day on
which banks in New York, New York are required or authorized by Law to be
closed.


          “Business
EBITDA” means an amount, which may be either a positive or negative
number, equal to the Consolidated Operating Income (or consolidated operating
loss) of the Business for the period from and including the Measuring Time
through and including the Closing Date, plus the Business Adjustments for such
period, and plus depreciation and amortization to the extent taken into account
in determining such Consolidated Operating Income or loss. Attached in Schedule
J is an illustrative example of the calculation of Business EBITDA.


          “Business
Inventory” shall mean the
inventory, including merchandise, raw materials, work-in-process and finished
goods, of the Transferred Entities, and inventory owned and used by Sellers
primarily in the conduct of the Business and maintained, held or stored by or
for Sellers at Closing, and any prepaid deposits for any of the same. For
avoidance of doubt any inventory used or held for use in the Excluded Business
shall not be included in “Business Inventory.”


          “Business
Intellectual Property” shall mean the Purchased Intellectual
Property, all Intellectual Property licensed to any Seller or its Affiliates
(other than the Transferred Entities) and primarily used in the conduct of the
Business as of the Closing Date, and all Intellectual Property owned or
licensed to any Transferred Entity, in each case, that is not Excluded
Intellectual Property.


          “Business
Leased Real Property” shall mean all real property leased or
subleased under the Real Property Leases.


          “Business
Material Adverse Effect” means (i) any change, effect or
circumstance that, individually or in the aggregate, has had, or would
reasonably be expected to have, a material adverse effect on the business,
assets, liabilities, results of operations or financial condition of the
Business; provided, however, that changes, effects or
circumstances, alone or in combination, that arise out of or result from (A)
changes in economic conditions, financial or securities markets in general, or
the industries and markets (including with respect to commodity prices) in
which the Business is operated, provided such change does not
disproportionately effect the Business, (B) the execution and performance of
this Agreement or the announcement of this Agreement and the transactions
contemplated hereby, (C) acts of God, calamities, national or international
political or social conditions, including the engagement by the United States
in hostilities, whether commenced before or after the date hereof, or the
occurrence of any military attack or terrorist act upon the United States, provided
such act, calamity or condition does not disproportionately effect the
Business, (D) the failure, in and of itself, to achieve any projections,
forecasts, estimates, performance metrics or operating statistics (whether or
not shared with Purchaser) or to grow in any respect (it being understood that
this clause (D) shall not exclude the facts or circumstances giving rise to
such failure) or (E) any actions taken, or failures to take action, or such
other changes or events, in each case, to which Purchaser has consented, shall
not be considered in determining whether a Business Material Adverse Effect has
occurred or (ii) 


84





any material adverse change in or material adverse effect on the ability
of Honeywell or any Seller to consummate the transactions contemplated hereby.


          “Business
Personal Property” shall mean all
furnishings, furniture, computer equipment, office equipment and supplies,
vehicles, tooling, patterns, dies, jigs, machinery and equipment and other
tangible personal property (other than Business Inventory and any items
disposed of after the date hereof in the ordinary course of business) which
is either (i) located on or utilized by Transferred Employees who work at any Purchased
Owned Real Property or on any property that is the subject of the Assumed Real
Property Leases or (ii) is owned and used
primarily in the conduct of the Business.


          “Business
Products” shall mean automotive (i) filtration
products, (ii) spark plugs and ignition products and (iii) car care products,
including antifreeze, brake fluid, and other repair, maintenance, additives and
appearance products, in each case sold by
the Business prior to the Closing Date.


          “C.G.S.”
shall have the meaning set forth in Section 9.4(i).


          “Closing”
shall have the meaning set forth in Section 2.1.


          “Closing
Approval” shall have the meaning set forth in Section 9.4(h).


          “Closing Date”
shall have the meaning set forth in Section 2.1.


          “Closing Date
Audited Statements” shall have the meaning set forth in Section
1.8(c)(i).


          “Closing Date
Cash” means the amount of all cash and cash equivalents of the
Business as of the Closing Date, determined in accordance with Applicable
Accounting Principles, to the extent not distributed from Transferred Entities
prior to Closing or removed from the Purchased Assets or the Transferred
Entities by Sellers prior to Closing.


          “Closing Date
Working Capital” means Working Capital as of the close of business
on the Closing Date.


          “Closing
Statement” shall have the meaning set forth in Section 1.8(c)(ii).


          “Closing
Statement Dispute Notice” shall have the meaning set forth in Section 1.8(d).


          “COBRA”
shall have the meaning set forth in Section 3.12(e).


          “Code”
means the Internal Revenue Code of 1986, as amended.


          “Collateral
Source” shall have the meaning set forth in Section 9.4(b).


          “Competing
Business” shall have the meaning set forth in Section 5.11(a).


85





          “Competing
Business Transaction” means (i) a sale, grant, authorization or
issuance by any of the Transferred Entities of (or the sale, grant,
authorization, issuance or announcement of any right to purchase) any debt or
equity securities (or securities convertible into or exchangeable for debt or
equity securities of any class or series of capital stock) of such Transferred
Entity (ii) any sale, transfer, license, lease, pledge, mortgage, or other
disposition of a material portion of the Purchased Assets (other than pursuant
to existing Contracts, the sale of Business Products or Business Inventory, the
exclusive or non-exclusive technology or brand licenses of the Business
Intellectual Property, in each case, in the ordinary course of business
consistent with past practice, or the sale or licensing of certain Intellectual
Property rights underlying Honeywell’s Sulfur Filter and Diesel Particulate
Filter technology), or (iii) any plan or agreement of complete or partial
liquidation, dissolution, restructuring, merger, consolidation, business
combination, joint venture, recapitalization, reorganization, financing, tender
offer, share exchange, dissolution or other extraordinary transaction involving
a Transferred Entity.


          “Confidential
Information” shall have the meaning set forth in Section 5.12.


          “Confidentiality
Agreement” shall have the meaning set forth in Section 5.2(a).


          “Consolidated
Operating Income (loss)” means consolidated operating income (loss)
of the Business as reflected in the Closing Date Audited Statements subject to
the adjustment set forth on Schedule K.


          “Contract”
shall mean any legally binding contract, agreement, lease, sublease, license,
sales order, purchase order, indenture, note, bond, loan, instrument, lease,
conditional sale contract, mortgage, franchise, insurance policy, undertaking,
commitment or other arrangement or agreement that is binding on any Person or
any part of its property under applicable Law.


          “Control”
(including the terms “Controlled,” “Controlled by” and “under common Control
with”) means, with respect to the relationship between or among two or more
Persons, the possession, direct or indirect, of the power to direct or cause
the direction of the management and policies of a Person, whether through the
ownership of stock, as trustee, personal representative or executor, by
contract or credit arrangement or otherwise.


          “Copyrights”
means U.S. and foreign copyrights, whether registered or unregistered, and
pending applications to register the same, renewals and extensions in
connection any such registrations, together with all translations thereof.


          “CTDEP”
shall have the meaning set forth in Section 9.4(i).


          “Danbury
Facilities” shall have the meaning set forth in Section 9.4(i).


          “Deadline”
shall have the meaning set forth in Section 8.1(b).


          “Debt
Financing” shall have the meaning set forth in Section 5.23(a).


          “Deeds”
shall have the meaning set forth in Section 2.3(a)(v).


86





          “Deemed
Interest Adjustment” means an amount calculated as simple interest
on $950,000,000 from the Measuring Time through the Closing Date, calculated at
the Agreed Interest Rate in effect from time to time during such period.
Attached as Schedule L is an illustrative example of the Deemed Interest
Adjustment.


          “Deemed Tax
Adjustment” means the product of (x) the amount of Business EBITDA
minus (i) the Deemed Interest Adjustment and minus (ii) the amounts of
depreciation and amortization added back to Consolidated Operating Income in
determining Business EBITDA, multiplied by (y) 39%; provided, however,
that if the amount described in clause (x) is negative the Deemed Tax Adjustment
shall be zero. Attached as Schedule L is an illustrative example of the
Deemed Tax Adjustment.


          “Delayed
Closing Date” shall have the meaning set forth in Section 10.13.


          “Delayed
Transfer Assets” shall have the meaning set forth in Section
10.13.


          “De Minimis
Loss” shall have the meaning set forth in Section 9.4(a).


          “Disclosure
Schedule” shall have the meaning set forth in the Preamble of Article
III.


          “Disputed
Item” shall have the meaning set forth in Section 1.8(d).


          “Effective
Time” shall have the meaning set forth in Section 2.2.


          “Employee
Transferor” shall have the meaning set forth in Section
5.8(a)(i).


          “Employees”
shall have the meaning set forth in Section 5.8.


          “Encumbrances”
means any mortgage, lien, pledge, security interest, hypothecation, easements,
encumbrance or other similar charge or restriction.


          “Enforceability
Exceptions” shall have the meaning set forth in Section 3.2.


          “Engineering
and Institutional Controls” means any and all
restrictions, measures, covenants and obligations that may be used in lieu of,
in conjunction with or as a component of Remedial Actions to satisfy
Liabilities under Environmental Laws in connection with (i) requirements for
engineering and institutional controls; (ii) proscriptions against residential
and groundwater use; and (iii) any documents, instruments, agreements, rights
and obligations embodying, establishing or necessary to the foregoing,
including, without limitation, certifications, deed notices, deed restrictions,
easements, access agreements, equitable servitudes and restrictive covenants.


          “Environmental
Claims” means any claim, cause of action, investigation, proceeding, consent order, consent
agreement, or notice by any person or entity alleging potential
Liability arising out of, based on or resulting from (i) the presence, or
release into the environment of, or exposure to, any Material of Environmental
Concern at any location, or (ii) circumstances forming the basis of any
violation, or alleged violation, of, or liability under, any Environmental Law
or Environmental Permit.


87





          “Environmental
Investigation” means any environmental sampling,
monitoring or other subsurface investigation, or sampling of any surface
materials, of Owned Real Property or Business Leased Real Property.


          “Environmental
Laws” means all federal, interstate, state, local and foreign Laws
relating to pollution or protection of human health, safety, the environment or natural
resources damages, including Laws relating to emissions, discharges, releases
or threatened releases of Materials of Environmental Concern, or otherwise
relating to the manufacture, processing, distribution, use, discharge, generation, treatment,
storage, disposal, transport or handling of Materials of Environmental Concern.


          “Environmental
Permit” means
any permit, approval, identification number, license or other authorization
required under any applicable Environmental Law.


          “Equity
Interest” shall have the meaning set forth in Section 3.3.


          “ERISA”
means the Employee Retirement Income Security Act of 1974, including the rules
and regulations promulgated thereto.


          “ERISA
Affiliate,” as to any person, means any member of a controlled group
of corporations or of a group of trades or businesses under common control,
with such person, in each case within the meaning of Section 414 of the Code.


          “Estimated
Closing Statement” shall have the meaning set forth in Section 1.8(b).


          “Estimated
Net Cash Adjustment” shall have the meaning set forth in Section 1.8(b).


          “Excluded
Business” shall mean for purposes of this Agreement (i) the
licensing or other disposition of Excluded Intellectual Property to third
parties, (ii) the performance of the Retained Contracts, (iii) the design,
manufacture, marketing, distribution and sale of air conditioning refrigerants
and related equipment and additives for mobile air conditions systems and
cooling systems for gasoline and diesel engines and similar turbocharger
technology related products, thermal systems (including exhaust gas and charge
air coolers, aluminum radiators and cooling modules and recirculation
products), automotive speed position and pressure sensors, mechanical parts for
vehicle, aircraft, rail and industrial engines (not including filters or spark
plugs) and brake hard parts and other friction materials (including disc and
drum brake pads, shoes, linings, brake blocks and other components for vehicle,
aircraft and rail, industrial and on- and off-highway applications) sold,
produced or distributed by applicable Honeywell divisions and/or business units
(including by Honeywell’s Transportation Systems division), and (iv) for
purposes of Section 5.11 of this Agreement only and the definition of
the “Competing Business”, the distribution and sale of brake fluid, lubricants,
cleaners and associate wheel cleaners sold, produced or distributed by
applicable Honeywell divisions and/or business units (including by Honeywell’s
Transportation Systems division) shall be deemed included in the definition of
“Excluded Business.” 


          “Excluded
Intellectual Property” means all Intellectual Property owned or
licensed by any Seller or any Transferred Entity that is not used primarily or
exclusively in the conduct of 


88





the Business, all Intellectual Property set forth on Schedule 1.2(n)
or Section 3.16 of the Disclosure Schedule that is provided to Purchaser
pursuant to the Transition Services Agreement and certain Intellectual Property
rights underlying Honeywell’s Sulfur Filter and Diesel Particulate Filter
technology, and any and all goodwill represented thereby and pertaining
thereto, and the right to sue and recover damages for past, present and future
infringement, dilution, misappropriation or other violation or conflict
associated therewith, including all rights to own and license any of the
Sellers’ Marks and associated Intellectual Property rights.


          “Financing
Parties” shall have the meaning set forth in Section 10.4.


          “Financial
Statements” shall have the meaning set forth in Section 3.5(a).


          “Foreign
Approval” shall have the meaning set forth in Section 10.13.


          “Foreign
Benefit Plan” shall have the meaning set forth in Section 3.12(b).


          “Foreign
Benefit Plans” shall have the meaning set forth in Section 3.12(b).


          “Former
Employees” shall have the meaning set forth in Section
5.8.


          “GAAP”
means United States generally accepted accounting principles and practices in
effect from time to time applied consistently throughout the periods involved.


          “Governmental
Authority” means any foreign or United States federal, state or
local governmental, regulatory or administrative agency or any court, tribunal,
or judicial or arbitral body.


          “Governmental
Order” means any order, writ, judgment, injunction, decree,
stipulation, determination or award entered by or with any Governmental
Authority.


          “Gross U.S.
Purchase Price” shall have the meaning set forth in Section 2.4(b).


          “Holt Japan”
shall have the meaning set forth in Section 1.1(a)(ii).


          “Holt
Lloyd Spain” shall have the meaning set forth in Section
5.27.


          “Holt New Zealand”
shall have the meaning set forth in Section 1.1(a)(ii).


          “Holts South
Africa” shall have the meaning
set forth in Section 1.1(a)(ii).


          “Holt UK”
shall have the meaning set forth in Section 1.1(a)(iii).


          “Honeywell”
shall have the meaning specified in the Preamble.


          “Honeywell
Canada” shall have the meaning
set forth in Section 1.1(b).


          “Honeywell
China” shall have the meaning set
forth in Section 1.1(b).


89





          “Honeywell
Filter Litigation” shall mean any current or future class action,
investigation, or other civil, criminal, regulatory or administrative
proceeding maintained or initiated against Honeywell or its Affiliates by any
private plaintiff or the United States Department of Justice, any U.S. or
Canadian Governmental Entity, the U.S. state Attorney Generals, local state,
county or municipal authorities or entities, or the SEC relating to or arising
from allegations of price fixing, bid rigging and allocation of customers in
the aftermarket for automotive oil, air, fuel and transmission filters.


          “Honeywell
International UK” shall have the
meaning set forth in Section 1.1(a)(iii).


          “Honeywell
France” shall have the meaning
set forth in Section 1.1(b).


          “Honeywell
Mexico 1” shall have the meaning
set forth in Section 1.1(b).


          “Honeywell
Mexico 2” shall have the meaning
set forth in Section 1.1(b).


          “Honeywell
Portugal” means Holt Lloyd & Raposo Limitada, a Portuguese
Transferred Entity, in which another Transferred Entity holds a 35% Equity
Interest, as set forth on Section 3.3 of the Disclosure Schedule.


          “Honeywell
Singapore” shall have the meaning set forth in Section 1.1(b).


          “HSR Act”
shall have the meaning set forth in Section 5.5(a).


          “Income Tax”
means (i) any income, franchise, gains, corporation, withholding or similar Tax
imposed on or measured by net income, profits, gains or similar items
(including U.S. federal Income Tax) and any interest, additional amounts, additions
to tax, penalties or similar items with respect thereto and (ii) any liability
for payments described in clause (i) as a result of being or been a member of
an affiliated, consolidated, combined, unitary or similar group, or under a tax
sharing, tax allocation, tax indemnity or other agreement, or as a result of
being liable for another Person’s taxes as a transferee or successor, by
contract or otherwise or any payments for group relief.


          “Indebtedness”
means, with respect to either a Seller or a Transferred Entity, (i) all
indebtedness of such Person, whether or not contingent, for borrowed money;
(ii) all obligations of such Person evidenced by notes, bonds, debentures or
other similar instruments; (iii) all obligations, contingent or otherwise,
of such Person under letter of credit, bank guarantees or similar facilities
(other than Sellers’ Letters of Credit and Sellers’ Guarantees); (iv) all
Indebtedness of others referred to in clauses (i) through (iii) above
guaranteed directly or indirectly in any manner by such Person, or in effect
guaranteed directly or indirectly by such Person.


          “Indemnified
Party” shall have the meaning set forth in Section 9.3(a).


          “Indemnifying
Party” shall have the meaning set forth in Section 9.3(a).


          “Independent
Accountant” means a partner in the New York office of Ernst &
Young LLP or a substitute therefor as provided in Section 1.8(e).


90





          “Insurance
Policies” shall have the meaning set forth in Section 3.18.


          “Intellectual
Property” means all Patents, Trademarks, Copyrights, know-how, trade
secrets, and mask works, utility and industrial models and applications
therefor.


          “Interests”
shall have the meaning set forth in Section 1.1(e)(i).


          “Interim
Balance Sheet” shall have the meaning set forth in Section 3.5(a).


          “Interim
Financial Statements” shall have the meaning set forth in Section 3.5(a).


          “Interim
Income Statement” shall have the meaning set forth in Section 3.5(a).


          “Internal
Controls” shall have the meaning set forth in Section 3.5(c).


          “ISRA”
shall mean the New Jersey Industrial Site Recovery Act, N.J.S.A. 13:1K et seq,
N.J.A.C. 7:26B et seq., as amended by the Site Remediation Reform Act, N.J.S.A.
58:10C-1 et seq. (“SRRA”), and all rules and regulations
promulgated thereunder, as amended.


          “Key
Customers” shall have the meaning set forth in Section 3.22.


          “Key
Suppliers” shall have the meaning set forth in Section 3.22.


          “Knowledge”
with respect to Honeywell shall mean the actual knowledge of the individuals
identified on Schedule M, after reasonable inquiry by such individuals
of any person who is a Band 4 (or higher) management-level employee of the
Business who has supervisory responsibility for the matter in question. 


          “Labor
Contract” and “Labor Contracts” shall have the respective
meanings set forth in Section 5.8(c).


          “Law”
means any law, statute, ordinance, rule, code, order, requirement or rule of
law (including common law) or regulation of any Governmental Authority, or any
binding agreement with any Governmental Authority binding upon a Person or its
assets, or any Law relating to employment standards, human rights, health and
safety, labor relations, workplace safety and insurance and/or pay equity.


          “Liability”
means any direct or indirect liability, indebtedness, claim, loss, damage,
deficiency, obligation or responsibility, fixed or unfixed, choate or inchoate,
liquidated or unliquidated, secured or unsecured, accrued, absolute, known or
unknown, contingent or otherwise.


          “Losses”
means any losses, costs or expenses (including reasonable attorneys’ fees and
expenses), judgments, fines, Taxes, claims, damages and assessments.


          “LEP”
shall have the meaning set forth in Section 9.4(i).


          “LSRP”
shall have the meaning set forth in Section 9.4(h).


91





          “Made
Available” means that the information referred to (i) has been
actually delivered (whether by email transmission or hand delivery) to
Purchaser or Sellers or to their respective outside legal counsel, as
applicable, or (ii) was posted on the electronic datasites located at https://datasite.merrillcorp.com,
in each case, at least one (1) Business Day prior to the execution of this
Agreement.


          “Management”
means generation, production, distribution, processing, storage, treatment,
operation, transportation, recycling, reuse and/or disposal, as those terms are
defined in any applicable Environmental Law.


          “Marketing
Period” means the first period of 15 consecutive Business Days
commencing after the date hereof and throughout which (i) Purchaser shall have
the Required Information, (ii) the conditions set forth in Sections 6.1 and 6.4
shall have been satisfied (except as provided in Section 10.13); provided
that, notwithstanding the foregoing, (A) the Marketing Period shall exclude any
period between August 12, 2011 and September 6, 2011 and (B) so long as Sellers
shall have previously delivered to Purchaser the financial information
referenced in Sections 5.23(a)(iii)(A) and (B) and such other
assistance referenced in Section 5.23(a)(iii)(C) (to the extent such
assistance is requested by Purchaser on or prior to August 5, 2011), the
Marketing Period must commence no later than September 6, 2011. Notwithstanding
the foregoing, if, prior to the completion of the Marketing Period (A)
PricewaterhouseCoopers LLP shall have withdrawn its audit opinion with respect
to any financial statements included in the Required Information, then the
Marketing Period shall not commence unless and until a new unqualified audit
opinion is issued with respect thereto by PricewaterhouseCoopers LLC or another
independent public accounting firm reasonably acceptable to Purchaser or (B)
the financial statements included in the Required Information that is available
to Purchaser on the first day of any such period would be required to be
updated under Regulation S-X in order to be sufficiently current on any day
during such period to permit a registration statement using such financial
statements to be declared effective by the SEC on the last day of such period,
then the Marketing Period shall not commence until the receipt by Purchaser of
updated Required Information that would be required under Rule 3-12 of
Regulation S-X to permit a registration statement using such financial
statements to be declared effective by the SEC on the last day of such new 15
consecutive Business Day period.


          “Material
Contract” shall have the meaning set forth in Section 3.13(a).


          “Materials
of Environmental Concern” means any “hazardous substance” and any “pollutant” or “contaminant”
or words of similar meaning of effect as defined in or regulated under
Environmental Laws, including any petroleum product, breakdown product or byproduct, solvent, radioactive material,
toxic mold or asbestos.


          “Measuring
Time” means 12:01 a.m. local time on January 1, 2011. 


          “Measuring
Time Working Capital” means Working Capital as of the Measuring
Time.


          “Modified
Duty Employees” shall have the meaning set forth in Section
5.8(a)(viii)(A).


          “National
Laws” shall have the meaning set forth in Section 5.8(b)(i).


92





          “Net Cash
Adjustment” means an amount (which can be a positive or a negative
number) equal to Closing Date Cash minus Target Cash.


          “NJDEP”
shall have the meaning set forth in Section 9.4(h).


          “Non-United
States Business” shall mean the Business as operated outside of the
United States on the date hereof.


          “Non-U.S.
Employee” shall have the meaning set forth in Section 5.8(b)(i).


          “Obligations”
shall have the meaning set forth in Section 5.26(a).


          “OPEB
Benefits” shall have the meaning set forth in Section 3.12(e).


          “Owned Real
Property” means all Purchased Owned Real Property and any real
property owned by a Transferred Entity, together with all Structures located
thereon or attached thereto or owned by a Seller or a Transferred Entity and
located on any Business Leased Real Property.


          “Parent
Insurances” shall have the meaning set forth in Section 5.18.


          “Patentable
Technology” shall have the meaning set forth in Section 3.8(a).


          “Patents”
means U.S. and foreign patents and applications therefor and all provisional
applications, divisionals, reissues, re-examinations, extensions, continuations
and continuations-in-part thereof.


          “Permit”
means any permit, franchise, authorization, license, consent, registration or
other approval issued or granted by any Governmental Authority relating
primarily to the Business or Purchaser’s business, as applicable.


          “Permitted
Encumbrances” means such of the following as to which no
enforcement, collection, execution, levy or foreclosure proceeding shall have
been commenced: (A) mechanics’, carriers’, workmen’s, repairmen’s or other like
Encumbrances arising or incurred in the ordinary course of business for amounts
not yet delinquent or which are being contested in good faith by appropriate
legal proceedings, (B) Encumbrances arising under original purchase price
conditional sales contracts (other than sale of the fee interest in any Owned
Real Property) and equipment leases with third parties entered into in the
ordinary course of business, (C) Encumbrances for Taxes and other governmental
charges that are not due and payable, or are being contested in good faith by
appropriate proceedings and, in each case, for which adequate reserves have
been maintained, (D) imperfections of title, easements, covenants,
restrictions, rights of way, or other like Encumbrances, if any, which
imperfections of title, easements, covenants, restrictions, rights of way or
other like Encumbrances do not, individually or in the aggregate, materially
impair the continued use and operation of or materially detract from the value
of the specific assets to which they relate, (E) Software or other similar
third-party licenses granted by the Business, as applicable, in the ordinary
course of business, (F) any Encumbrance set forth on Schedule N, (G)
Encumbrances that will be removed prior to the Closing Date, (H) Encumbrances
on accounts receivable under Honeywell’s Trade Accounts Receivable program, 


93





all of which shall be removed as of the Closing Date, (I) any
Encumbrance of record as of the date of this Agreement (other than monetary
liens) that would be identified on a title search or similar search with
respect to any of the Owned Real Property or Business Leased Real Property, and
(H) any matters that would be revealed in a survey of the Owned Real Property
or Business Leased Real Property and which, individually or in the aggregate,
do not materially impair the continued use and operation of the applicable
Owned Real Property or Business Leased Real Property.


          “Person”
means an individual, corporation, partnership, firm, limited liability company,
association, trust, unincorporated organization, entity or group.


          “Post-Closing
Tax Period” means any Tax period beginning after the
Closing Date and, with respect to a Tax period that begins on or before the
Closing Date and ends thereafter, the portion of such Tax period beginning
after the Closing Date.


          “Post-Reference
Date Tax Period” means any Tax period beginning after
December 31, 2010 and, with respect to a Tax period that begins on or before
December 31, 2010 and ends thereafter, the portion of such Tax period beginning
after December 31, 2010.


          “Pre-Closing
Covenant” shall have the meaning set forth in Section 9.1.


          “Pre-Closing
Environmental Liabilities” means any and all Liabilities of the
Sellers or any of the Transferred Entities, other than the Retained
Liabilities, in connection with (A) all Liabilities arising from any obligation
pursuant to Environmental Laws to investigate and/or remediate Materials of
Environmental Concern at, on, under, or emanating from the Owned Real Property
or the Business Leased Real Property, (B) all Environmental Claims in
connection with the Owned Real Property or the Business Leased Real Property,
and (C) all Liabilities under Environmental Laws relating to the conduct of the
Business at the Owned Real Property or the Business Leased Real Property,
including the handling, management, treatment or disposal on-site of Materials
of Environmental Concern or compliance with Environmental Laws.


          “Pre-Closing
Tax Period” means any Tax period ending on or before the Closing
Date and, with respect to a Tax period that begins on or before the Closing
Date and ends thereafter, the portion of such Tax period ending on the Closing
Date.


          “Pre-Reference
Date Tax Period” means any Tax period ending on or before December
31, 2010 and, with respect to a Tax period that begins on or before December
31, 2010 and ends thereafter, the portion of such Tax period ending on December
31, 2010.


          “Prestone”
shall have the meaning set forth in Section 1.1(a)(i).


          “Product
Liability Claims” means any (i) (A) lawsuit, class action, or other
claim by a third party or third parties (other than a Governmental Authority)
(whether based on negligence, fraud, failure to warn, strict products
liability, violation of applicable Law, or other theory, and whether seeking
injunctive relief, money damages, or other remedy), related to or arising out
of personal injury or death, or damage, destruction or diminished value of
property or (B) investigation, action or other claim by any Governmental
Authority concerning compliance or 


94





noncompliance with applicable Laws (whether seeking fines, injunctive
relief, Product Recall, field action, or other penalties), or (ii) claim by a
customer of the Business seeking damages, costs, reimbursement, contribution,
indemnification, injunctive relief, repair, replacement, or other
responsibility for Losses or other Liabilities related to or arising out of the
matters described in clauses (i) (A) or (B), or any systemic design defect or
systemic manufacturing defect, any voluntary or involuntary Product Recall,
field action or violation of applicable Laws, in each case of subsections (i)
and (ii) related to or arising out of a Business Product.


          “Product Recall” means any (i)
directive, order or other action by any Governmental Authority requiring or
having the effect of requiring that any product manufactured or sold by the
Sellers or the Sellers’ Affiliates in connection with the Business be recalled
or (ii) voluntary recall of any product manufactured or sold by the Sellers or
the Sellers’ Affiliates in connection with the Business.


          “Purchase
Price” shall have the meaning set forth in Section 1.6.


          “Purchased
Assets” shall have the meaning set forth in Section 1.1(c).


          “Purchased
Entities” shall mean the entities set forth on Schedule C.


          “Purchased
Intellectual Property” shall have the meaning set forth in Section 1.1(c)(v).


          “Purchased
Owned Real Property” shall have the meaning set forth in Section 1.1(c)(viii).


          “Purchaser”
shall have the meaning specified in the Preamble.


          “Purchaser
Disclosure Schedule” shall have the meaning set forth in the
Preamble of Article IV.


          “Purchaser
Indemnified Parties” shall have the meaning set forth in Section
9.2(a).


          “Purchaser Material Adverse Effect” means
any material adverse change in or material adverse effect on the ability of
Purchaser to perform its obligations under this Agreement or to consummate the
transactions contemplated hereby.


           “Purchaser’s
Foreign Retirement Plans” shall have the meaning set forth in Section
5.8(b)(iii)(D).


          “Purchaser’s
Savings Plans” shall have the meaning set forth in Section 5.8(a)(iv)(A).


          “Purchaser’s
U.S. Pension Plan” shall have the meaning set forth in Section 5.8(a)(iv)(B).


          “Purchasing
Entity” shall have the meaning set forth in Section 10.6.


          “Rank Group”
shall have the meaning set forth in the Preamble.


95





          “RAO”
shall have the meaning set forth in Section 9.4(h).


          “Real
Property Lease Assignments” shall have the meaning set forth in Section 2.3(a)(iv).


          “Real Property Leases” means the Assumed
Real Property Leases and all real property leases, subleases, licenses and
occupancy agreements to which any Transferred Entity is a party, in each case,
together with any amendments or modifications thereto.


          “Registered
Intellectual Property” shall mean all United States and foreign:
(A) Patents; (B) registered Trademarks, and applications to register
Trademarks; (C) registered Copyrights registrations, and applications to
register Copyrights; and (D) any other Intellectual Property that is the
subject of an application, certificate, filing, registration or other document
issued by, filed with, or recorded by, any state, government or other public
legal authority at any time.


          “Related
Party Transaction” shall have the meaning set forth in Section
3.20(a). 


          “Release”
means any
spilling, leaking, pumping, emitting, emptying, discharging, injecting,
escaping, releasing, leaching, dumping, or disposing of Materials of
Environmental Concern into the environment.


          “Remedial
Action” means
all actions to (A) clean up, remove, treat or handle in any other way Materials
of Environmental Concern in the environment; (B) restore or reclaim the
environment or natural resources, including the payment of natural resource
damages; (C) prevent the Release of Materials of Environmental Concern so that
they do not migrate, endanger or threaten to endanger public health or the environment,
except for actions taken in the ordinary course of business to prevent the
Release of Materials of Environmental Concern as they are used or stored in the
ordinary course of business; or (D) perform remedial investigations,
feasibility studies, corrective actions, closures and postremedial or
postclosure studies, investigations, operations, maintenance and monitoring.


          “Required
Information” shall have the meaning set forth in Section
5.23(a)(iii).


          “Retained
Assets” shall have the meaning set forth in Section 1.2.


          “Retained
Contracts” shall have the meaning set forth in Section 1.2(i).


          “Retained
Employees” shall mean those Employees of the Business set forth on Schedule O.


          “Retained
Environmental Liabilities” shall mean the liabilities set forth on Schedule
1.4(i).


          “Retained
Interest” shall have the meaning set forth in Section 1.1(e)(i).


          “Retained
Liabilities” shall have the meaning set forth in Section 1.4.


96





          “Retained
Taxes” shall mean any and all:


          (a)
Income Taxes of or payable by any Transferred Entity or with respect to the
Business or the Purchased Assets, in each case for any Pre-Closing Tax Period,
together with any interest, penalty or additions to Tax accruing after the
Closing Date on Income Taxes described in this clause (a),


          (b)
Taxes (other than Income Taxes) of or payable by any Transferred Entity or with
respect to the Business or the Purchased Assets, in each case for any
Pre-Reference Date Tax Period, together with any interest, penalty or additions
to Tax accruing after December 31, 2010 on Taxes described in this clause (b)
or that are attributable to the reporting of (or failure to report) any Tax
item (or the failure to pay any Taxes) by or with respect to any Transferred
Entity, the Business or the Purchased Assets prior to the Closing Date,


          (c)
Taxes arising as a result of any inclusion under Section 951(a) of the Code (or
any similar or corresponding provision of state or local Tax law) with respect
to any Transferred Entity attributable to (i) “subpart F income,” within the
meaning of Section 952 of the Code (or any similar or corresponding provision
of state or local Tax law), received or accrued on or prior to the Closing Date
or (ii) the holding of “United States property,” within the meaning of Section
956 of the Code (or similar or corresponding provision of state or local Tax
Law), on or prior to the Closing Date, computed, in each case, based on the
amount of such Taxes that would be payable with respect to any Transferred
Entity if the relevant Tax period ended on the Closing Date, and


          (d)
(i) Taxes of or payable by Sellers or any of their Affiliates (other than the
Transferred Entities) for any taxable period (other than Assumed Business
Taxes); (ii) Taxes that arise under Treasury Regulation Section 1.1502-6 or any
similar provision of state, local or foreign Law by virtue of any Transferred
Entity having been a member of a consolidated, combined, affiliated, unitary or
other similar tax group prior to the Closing, (iii) Taxes of or payable by any
Transferred Entity having liability for Taxes of another Person arising under
principles of transferee or successor liability or by contract as a result of activities
or transactions taking place at or prior to the Closing, (iv) Taxes that arise
from or are attributable to any inaccuracy in or breach of any representation
or warranty made in Section 3.7, (v) Taxes that arise from or are
attributable to any breach of any Tax covenant by Honeywell under this
Agreement, (vi) Taxes that are a withholding Tax on any payment by Purchaser,
any Transferred Entity or any of their respective Affiliates to Seller or any
of its Affiliates pursuant to this Agreement or prior to Closing, and (vii)
except as otherwise provided by Section 5.7, any Taxes that are
attributable to the transfer of any asset under this Agreement, the ownership
of any Retained Assets or any Transferred Entities Retained Assets, the
transfer of any Retained Assets or any Transferred Entities’ Retained Assets,
or Taxes of or payable by any Transferred Entity arising out of any transaction
outside of the ordinary course of business occurring on or prior to the Closing
Date. 


          For
avoidance of doubt “Retained Taxes” shall not include the
portion of Transfer Taxes that are to be paid by Purchaser pursuant to Section
5.7.


          “SEC”
shall mean the Securities and Exchange Commission. 


97





          “Section 75 Debt” shall mean any Liabilities
that arise as a result of the transactions contemplated by this Agreement, and
which are imposed under or pursuant to Section 75 or Section 75A of the
Pensions Act 1995 (or by any regulations promulgated thereunder). 


          “Securities
Act” shall mean the United States Securities Act of 1933, as
amended, and the rules and regulations promulgated thereunder. 


          “Seller”
shall have the meaning specified in the Preamble.


          “Sellers”
shall have the meaning specified in the Preamble.


          “Sellers’
Foreign Benefit Plans” shall have the meaning set forth in Section 5.8(b)(iii).


          “Sellers’
Foreign Retirement Plans” shall have the meaning set forth in Section
5.8(b)(iii)(D).


          “Sellers’ FSAs” shall have the meaning set
forth in Section 5.8(a)(xi).


          “Seller
Fundamental Representation and Warranty(ies)” shall have the meaning
set forth in Section 9.1.


          “Seller
Indemnified Parties” shall have the meaning set forth in Section
9.2(b).


          “Sellers’
Letters of Credit” shall have the meaning set forth in Section
5.19.


          “Sellers’
Guarantees” shall have the meaning set forth in Section 5.19.


          “Sellers’
Marks” shall have the meaning set forth in Section 5.14.


          “Sellers’
U.S. Pension Plan” shall have the meaning set forth in Section 5.8(a)(iv)(B).


          “Sellers’
Savings Plan” shall have the meaning set forth in Section 5.8(a)(iv)(A).


          “Shared
Employees” shall mean those Employees primarily engaged in the
support of the Business and set forth on Schedule P.


          “Short Period”
shall have the meaning set forth in Section 5.15(i).


          “Solvent”
shall have the meaning set forth in Section 4.5.


          “Software”
means computer software programs and databases in any form, including source
code, object code, Internet web sites and all associated documentation.


          “SSRA”
shall have the meaning set forth in Section 9.4(h).


          “Straddle
Period” means (i) in the case of Income Taxes, any taxable period
beginning on or before the Closing Date and ending after the Closing Date and
(ii) in the case of any other Taxes, any taxable period beginning on or before
December 31, 2010 and ending after December 31, 2010.


98





          “Subsidiary”
of a Person means any corporation or other legal entity of which such Person
(either alone or through or together with any other Subsidiary or Subsidiaries)
is the general partner or managing entity or of which at least a majority of
the stock or other equity interests the holders of which are generally entitled
to vote for the election of the board of directors or others performing similar
functions of such corporation or other legal entity is directly or indirectly
owned or Controlled by such Person (either alone or through or together with
any other Subsidiary or Subsidiaries).


          “Survival
Period” shall have the meaning set forth in Section 9.1. 


          “Target Cash”
means (x) if the Closing occurs prior to June 1, 2011, the Adjusted Interim
Cash Flow, and (y) if the closing occurs after May 31, 2011, the lesser of (i)
the Adjusted Interim Cash Flow and (ii) $25,000,000.


          “Tax
Accountant” shall have the meaning set forth in Section
5.15(b)(iv).


          “Tax
Proceeding” shall mean any contest, assessment or other proposed
adjustment with respect to Taxes.


          “Tax Return”
shall mean any report, return, election, statement or other document or similar
filing (including the attached schedules) required to be filed with respect to
Taxes, including any information return, claim for refund, amended return, or
declaration of estimated Taxes.


          “Taxes”
shall mean any and all (a) domestic or foreign, federal, state, local or other
taxes, duties, levies, imposts, tariffs, fees or similar charges of any kind
(together with any and all interest, penalties, fines, additional to tax and
additional amounts imposed with respect thereto) imposed by any Governmental
Authority, including taxes, duties, levies, imports, tariffs, fees or similar
charges with respect to income, franchises, windfall or other profits, gross
receipts, property, sales, use, capital stock, employment, unemployment,
health, disability, retirement, social security, unclaimed property, payroll,
customs duties, import duties, transfer, license, workers’ compensation or net
worth, and taxes, duties, levies, imports, tariffs, fees or similar charges in
the nature of excise, withholding, ad valorem or value added, and (b) liability
for the payment of any Tax (i) as a result of being a member of a consolidated,
combined, unitary or affiliated group that includes any other Person or
otherwise joining in a fiscal unity, (ii) by reason of any obligation to
indemnify or otherwise assume or succeed to the liability of any other Person
for Taxes, including, a Tax sharing, Tax indemnity or similar agreement, or
(iii) by reason of transferee or successor liability, whether imposed by Law,
contractual arrangement or otherwise.


          “Taxing
Authority” shall mean the Internal Revenue Service and any other domestic
or foreign Governmental Authority responsible for the administration or
collection of any Taxes.


          “Third Party
Claim” shall have the meaning set forth in Section 9.3(a).


          “Threshold
Amount” shall have the meaning set forth in Section 9.4(a). 


99





          “Trademarks”
means U.S. and foreign trademarks, trade dress, service marks, trade names,
domain names, whether registered or unregistered, and pending applications to
register the same, including all renewals thereof and all goodwill associated
therewith.


          “Transaction
Documents” shall have the meaning set forth in Section 3.2.


          “Transaction
Matters” shall have the meaning set forth in Section 10.9.


          “Transfer
Amount” shall have the meaning set forth in Schedule F.


          “Transfer
Taxes” shall have the meaning set forth in Section 5.7(b).


          “Transferred
Employees” means, collectively, the Transferred U.S. Employees and
the Transferred Non-U.S. Employees.


          “Transferred
Entities” shall have the meaning given in the Recitals and as set
forth on Schedule B.


          “Transferred
Entities Retained Assets” shall have the meaning set forth in Section 1.1(d)(ii).


          “Transferred
Entity” shall have the meaning given in the Recitals.


          “Transferred
Foreign Benefit Plans” shall have the meaning set forth in Section 5.8(b)(iii)(A).


          “Transferred
Non-U.S. Employees” shall have the meaning set forth in Section 5.8(b)(i).


          “Transferred
U.S. Employee” shall have the meaning given to it in Section 5.8(a)(i).


          “Transferred
U.S. Benefit Plans” shall have the meaning set forth in Section
5.8(a)(ix).


          “Transition
Services Agreement” means, subject to Section 5.6(b), the
transition services agreement in the form of Exhibit B attached
hereto.


          “Treasury
Regulations” means the regulations prescribed under the Code.


          “UK Pension
Scheme” shall have the meaning set forth in Section 5.8(b)(x).


          “U.S. Benefit
Plan” shall have the meaning set forth in Section 3.12(a).


          “U.S. Benefit
Plans” shall have the meaning set forth in Section 3.12(a).


          “Union
Pension Participants” shall have the meaning set forth in Section
5.8(a)(iv)(B).


          “United
States Business” shall mean the Business as operated in the United
States on the date hereof.


100





          “Unresolved
Items” shall have the meaning set forth in Section 1.8(e). 


          “VAT”
shall have the meaning set forth in Section 5.7(b).


          “WARN Act”
shall mean the Worker Adjustment and Retraining Notification Act.


          “Working
Capital” means the sum (which amount may be positive or negative) of
the current assets of the Business set forth on Schedule Q minus the
current liabilities of the Business set forth on Schedule Q and
calculated in accordance with the provisions of Schedule Q.


          “Working
Capital Adjustment” means an amount (which can be a positive or
negative number) equal to Closing Date Working Capital minus Measuring Time
Working Capital.


          “Year-End
Financial Statements” shall have the meaning set forth in Section 3.5(a).


                    (b)
When a reference is made in this Agreement to Articles, Sections, or Schedules,
such reference is to an Article or a Section of, or a Schedule to, this
Agreement, unless otherwise indicated. When a reference is made in this
Agreement to a party or parties, such reference is to parties to this
Agreement, unless otherwise indicated. The table of contents and headings
contained in this Agreement are for reference purposes only and shall not
affect in any way the meaning or interpretation of this Agreement. Whenever the
words “include,” “includes” or “including” are used in this Agreement, they
shall be understood to be followed by the words “without limitation” or “but
not limited to.” The definitions in this Agreement are applicable to the
singular as well as the plural forms of such terms. For avoidance of doubt, if
a formula in this Agreement subtracts a negative number, the absolute value of
the number shall be added. Schedule I has been intentionally omitted. 


          Section
10.3. Severability.
If any term or other provision of this Agreement is invalid, illegal or
incapable of being enforced by any rule of Law or public policy, all other conditions
and provisions of this Agreement shall nevertheless remain in full force and
effect so long as the economic or legal substance of the transactions
contemplated hereby is not affected in any manner materially adverse to any
party. Upon a determination that any term or other provision is invalid,
illegal or incapable of being enforced, Honeywell and Purchaser shall negotiate
in good faith to modify this Agreement so as to affect their original intent as
closely as possible in an acceptable manner to the end that the transactions
contemplated hereby are fulfilled to the maximum extent possible.


          Section
10.4. Entire
Agreement; No Third-Party Beneficiaries. This Agreement and the
Transaction Documents, including all exhibits and schedules attached hereto and
thereto and the Confidentiality Agreement constitute the entire agreement and
supersede any and all other prior agreements and undertakings, both written and
oral, among the parties hereto, or any of them, with respect to the subject
matter hereof. This Agreement does not, and is not intended to, confer upon any
Person other than the parties to this Agreement any rights or remedies
hereunder, except with respect to (x) the Persons entitled to
indemnification under Sections 5.15, 5.23 or 5.24 or under
Article IX who shall be express third party beneficiaries of, and shall
have the right to enforce, such provisions; provided that Purchaser’s
financing sources and their 


101





affiliates, officers, directors, employees, agents, advisors, successors
and assigns (the “Financing Parties”) shall be express
third-party beneficiaries of and have the right to enforce Sections 10.4,
10.9 and 10.10 and (y) any Purchasing Entities designated
by Purchaser in accordance with Section 10.7, provided that, to the
extent reasonably permitted, Purchaser shall act as agent for any Purchasing
Entity in connection with its enforcement of any rights hereunder.


          Section
10.5. Amendment;
Waiver. This Agreement may be amended only in a writing signed by
all parties hereto. Any waiver of rights hereunder must be set forth in
writing. A waiver of any breach or failure to enforce any of the terms or
conditions of this Agreement shall not in any way affect, limit or waive either
party’s rights at any time to enforce strict compliance thereafter with every
term or condition of this Agreement.


          Section
10.6. Binding
Effect; Assignment. This Agreement shall inure to the benefit of and
be binding upon the parties hereto and their respective legal representatives and
successors. Notwithstanding the foregoing, this Agreement shall not be assigned
by any party hereto by operation of Law or otherwise without the express
written consent of each of the other parties, except
that, without the consent of Honeywell, (a) Purchaser may assign all of
their rights hereunder to their lenders for collateral security purposes and
(b) Purchaser may designate one or more of its direct or indirect Subsidiaries
or other Affiliates to purchase any Purchased Asset (and assume any associated
Assumed Liabilities) (any such designated person, a “Purchasing Entity”) or assign
to them any other rights or obligations contained herein or in any other
Transaction Document; provided that Purchaser will remain liable for the
obligations so assigned. Each Purchasing Entity will be deemed Purchaser in
respect of such Purchased Asset and (subject to the other provisions of this
Agreement) any such Purchased Asset will be transferred by the relevant Seller
directly to such Purchasing Entity, such Purchasing Entity will assume the
associated Assumed Liabilities, and each Purchasing Entity shall pay the
portion of the Purchase Price to the relevant Seller that corresponds to the
allocation to such Purchased Asset reflected on Schedule D (as adjusted
by Section 2.4(a)). Appropriate reconciliation payments shall be made
between the relevant Purchasing Entity and the relevant Seller to reflect the
final Closing Statement. Any indemnity or other payment that relates to a
Purchased Asset (or Assumed Liability) under this Agreement shall be made
between the relevant Seller and the relevant Purchasing Entity.


          Section
10.7. Disclosure
Schedules. The Disclosure Schedule shall be construed with and as an
integral part of this Agreement to the same extent as if the same had been set
forth verbatim herein. Any matter disclosed pursuant to the Disclosure Schedule
or the Purchaser Disclosure Schedule shall not be deemed to be an admission or
representation as to the materiality of the item so disclosed. 


          Section
10.8. Specific
Performance. The parties agree that irreparable damage would occur
in the event that any of the provisions of this Agreement were not performed in
accordance with their specific terms or were otherwise breached. It is
accordingly agreed that the parties shall be entitled to seek an injunction or
injunctions to prevent breaches of this Agreement and to enforce specifically
the terms and provisions of this Agreement, this being in addition to any other
remedy to which they are entitled at law or in equity. Nothing contained herein shall prevent a
party from seeking damages in the event that specific performance is not
available.


102





          Section
10.9. Governing
Law. Any and all claims, disputes or controversies in any way arising
out of or relating to (a) this Agreement, (b) any breach, termination or
validity of this Agreement, (c) the transactions contemplated hereby or any debt financing or proposed debt
financing relating thereto or (d) any discussions or communications relating
in any way to this Agreement or transactions contemplated hereby or any debt financing or proposed debt
financing relating thereto (the “Transaction Matters”), and the existence or
validity of any and all defenses to such claims, disputes or controversies,
shall be governed and resolved exclusively by the laws of the State of New
York, notwithstanding the existence of any conflict of laws principles that
otherwise would dictate the application of any other state’s law. Each party
irrevocably and unconditionally waives any right to object to the application
of New York law or argue against its applicability to any of the matters
referenced in the immediately preceding sentence.


          Section
10.10. Jurisdiction.


                    (a)
Each of the parties hereby irrevocably and unconditionally consents to submit
to the exclusive jurisdiction of the courts of the State of New York sitting in
New York County and the courts of the United States of America located in New
York County, New York for any litigation arising out of or relating to this
Agreement or the Transaction Matters (and agrees not to commence any litigation
relating hereto or thereto except in such courts), and further agrees that
service of any process, summons, notice or document by U.S. registered mail to
its respective address set forth in Section 10.1, shall be
effective service of process for any litigation brought against it in any such
court. Each of the parties hereby irrevocably and unconditionally waives any
objection to the laying of venue of any litigation arising out of this
Agreement or the transactions contemplated hereby or any of the other
transactions contemplated hereby or any related transaction in the courts of
the State of New York sitting in New York County or the courts of the United
States of America located in New York County, New York and hereby further
irrevocably and unconditionally waives and agrees not to plead or claim in any
such court that any such litigation brought in any such court has been brought
in an inconvenient forum. Notwithstanding the foregoing, each of the parties
hereto hereby agrees that it will not (and will cause its Subsidiaries to not)
bring or support any action, cause of action, claim, cross-claim or third-party
claim of any kind or description, whether in law or in equity, whether in
contract or in tort or otherwise, against any Financing Party in any way
relating to this Agreement or any of the transactions contemplated by this
Agreement, including any dispute arising out of or relating in any way to any
commitments related to the Debt Financing or the performance thereof, in any
forum other than a court of competent jurisdiction located within the County of
New York, New York, whether a state or Federal court, and that the provisions of
the Section 10.10(b) relating to the waiver of jury trial shall apply to
any such action, cause of action, claim, cross-claim or third-party claim.


                    (b)
EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY
RIGHT IT MAY HAVE TO TRIAL BY JURY IN CONNECTION WITH ANY LITIGATION ARISING
OUT OF OR RELATING IN ANY WAY TO TRANSACTION MATTERS.


          Section
10.11. Construction.
The headings of Articles and Sections in this Agreement are provided for
convenience only and will not affect its construction or interpretation. The 


103





language used in this Agreement is the language chosen by the parties
to express their mutual intent, and no rule of strict construction shall be
applied against any party.


          Section 10.12.
Counterparts.
This Agreement may be executed simultaneously in one or more
counterparts (including by facsimile or electronic .pdf submission), and
by the different parties in separate counterparts, each of which when executed
shall be deemed to be an original, but all of which shall constitute one and
the same agreement.


          Section
10.13. Delayed
Closing. Notwithstanding anything to the contrary
in Section 6.4 or Section 7.4, if the conditions set forth in Section
6.4 and Section 7.4 have been satisfied in all respects but for the
receipt of the approvals set forth on Schedule 10.13 (the “Foreign
Approvals”) with respect to the Purchased Assets set forth on such
Schedule (such Purchased Assets, the “Delayed Transfer Assets”), the conditions
set forth in Section 6.4 and Section 7.4 shall be deemed
satisfied for all purposes under this Agreement; provided that (i) the
Purchase Price payable by Purchaser at the Closing shall be reduced by the
applicable amount for such Delayed Transfer Assets set forth on Schedule
10.13, (ii) such Delayed Transfer Assets shall not be sold, conveyed,
transferred or assigned to Purchaser at the Closing and instead shall be
treated as Retained Interests until the third business day following the
receipt of the applicable Foreign Approval for such Delayed Transfer Assets
(each such date, a “Delayed Closing Date”) and (iii) on the
applicable Delayed Closing Date, Purchaser will pay to Sellers the applicable
amount for such Delayed Transfer Assets set forth on Schedule 10.13 and
the Sellers will sell, convey, transfer or assign to Purchaser the applicable
Delayed Transfer Assets, and Purchaser shall assume the Assumed Liabilities
associated with and related to the applicable Delayed Transfer Assets. For
avoidance of doubt, from and after the Closing Date and until the applicable
Delayed Closing Date, Sellers may own and operate the applicable Delayed
Transfer Assets in the ordinary course of business, consistent with past
practice and consistent with the provisions of Section 5.1 as though operation
of such Delayed Transfer Assets constituted operation of Purchased Assets prior
to the Closing Date. The Sellers shall operate the applicable Delayed Transfer
Assets for the account of the Purchaser and shall not (absent willful misconduct)
have any liability or obligation in connection with such operations, including
for any decline in revenues or profits. The Sellers will promptly pay to
Purchaser any cash generated by the applicable Deferred Transfer Assets, net of
any expenses of operating the Deferred Transfer Assets. For avoidance of doubt,
any liabilities of the Deferred Transfer Assets (whether arising before, on or
after the Closing and excluding any liabilities of any Transferred Entity) are
included in Assumed Liabilities.


 [Signature Page Follows.]


104






          IN WITNESS
WHEREOF, the parties hereto have caused this Stock and Asset Purchase Agreement
to be executed as of the date first written above by their respective officers
thereunto duly authorized.


	
  

 	
  

 	
  

 	
  

 
	
  

 	
 PURCHASER:

 
	
  

 	
  

 
	
  

 	
 By: 

 	
 /s/ Helen
 Golding

 	
  

 
	
  

 	
  

 	

 


 	
  

 
	
  

 	
 Name: Helen
 Golding

 
	
  

 	
 Title: Authorized
 Signatory

 
	
  

 	
  

 
	
  

 	
 RANK GROUP
 LIMITED

 
	
  

 	
  

 
	
  

 	
 By:

 	
 /s/ Helen
 Golding

 	
  

 
	
  

 	
  

 	

 


 	
  

 
	
  

 	
 Name: Helen
 Golding

 
	
  

 	
 Title: Authorized
 Signatory

 


105





          IN WITNESS
WHEREOF, the parties hereto have caused this Stock and Asset Purchase Agreement
to be executed as of the date first written above by their respective officers
thereunto duly authorized.


	
  

 	
  

 	
  

 	
  

 
	
  

 	
 SELLERS:

 
	
  

 	
  

 
	
  

 	
 HONEYWELL
 INTERNATIONAL INC.,

 on behalf of itself and the other Sellers

 
	
  

 	
  

 
	
  

 	
 By: 

 	
 /s/ Anne T.
 Madden

 	
  

 
	
  

 	
  

 	

 


 	
  

 
	
  

 	
 Name:Anne
 T. Madden

 
	
  

 	
 Title:VP,
 Corporate Development and

 Global Head of M&A

 


106