BALANCE SHEET, STATEMENT OF INCOME AND STATEMENT OF CASH FLOW
OF THE COMPANY AS OF AND FOR THE FISCAL YEAR ENDED, DECEMBER 31, 2005, WHICH
HAVE BEEN AUDITED BY MAHONEY COHEN.
M.
"AVAILABLE CASH FLOW" MEANS, WITHOUT DUPLICATION, WITH RESPECT TO
ANY FISCAL PERIOD OF THE COMPANY, CONSOLIDATED NET INCOME PLUS NON-CASH EXPENSES
OR MINUS NON-CASH INCOME ITEMS, INCLUDING, WITHOUT LIMITATION, DEPRECIATION,
AMORTIZATION, INTEREST AND ASBESTOS AND PENSION-RELATED INCOME/EXPENSE FOR SUCH
PERIOD IN ACCORDANCE WITH GAAP TO THE EXTENT DEDUCTED OR ADDED IN DETERMINING
CONSOLIDATED NET INCOME FOR SUCH FISCAL PERIOD MINUS (I) INTEREST AND PRINCIPAL
PAYMENTS PAID IN RESPECT OF THE NOTE DURING SUCH FISCAL PERIOD, (II) THE AMOUNT
OF ALL MANAGEMENT FEES PERMITTED TO BE PAID BY THE TERMS OF THE AGREEMENT DURING
SUCH FISCAL PERIOD, (III) THE FEDERAL TAX NET AMOUNT FOR SUCH FISCAL PERIOD,
(IV) PRINCIPAL PAYMENTS PAID IN RESPECT OF THE WORKING CAPITAL FACILITY FOR SUCH
FISCAL PERIOD, PROVIDED THAT IF ANY SUCH PREPAYMENT IS NOT A REGULARLY SCHEDULED
AMORTIZATION PAYMENT, THE PROCEEDS OF THE BORROWINGS SO PREPAID SHALL HAVE BEEN
USED EXCLUSIVELY IN THE SURVIVING CORPORATION'S OPERATIONS DURING SUCH FISCAL
PERIOD, AND (V) WITHOUT DUPLICATION FOR ANY DIVIDENDS OR DISTRIBUTIONS MADE IN
RESPECT OF THE ITEMS SET FORTH IN CLAUSES (I), (II), (III), OR (IV), ANY OTHER
AMOUNT DIVIDENDED OR DISTRIBUTED TO THE COMPANY'S EQUITYHOLDERS DURING SUCH
FISCAL PERIOD IN ACCORDANCE WITH SECTION 4 OF EXHIBIT B.
FOR THE AVOIDANCE OF
DOUBT, (1) THE NONCASH ADDBACKS FOR PURPOSES OF THE FOREGOING DEFINITION SHALL
BE NET OF ALL CASH PAYMENTS FOR THE APPLICABLE ITEMS, INCLUDING BUT NOT LIMITED
TO (I) CASH INTEREST AND PRINCIPAL PAYMENTS IN RESPECT OF THE NOTE, (II) CASH
PENSION CONTRIBUTIONS, (III) CASH POST RETIREMENT MEDICAL PLAN CONTRIBUTIONS AND
(IV) CASH ASBESTOS-RELATED LITIGATION PAYMENTS (IN RESPECT OF INDEMNITY PAYMENTS
AND DEFENSE COSTS) AND (2) THE COMPANY'S NET INCOME SHALL INCLUDE CASH EXPENSES
INCURRED PURSUANT TO THE AGREEMENT IN CONNECTION WITH THE CONSUMMATION OF THE
TRANSACTIONS ON THE CLOSING DATE NOT TO EXCEED $250,000 IN THE AGGREGATE.
N.
"BCA" HAS THE MEANING SET FORTH IN THE RECITALS TO THE AGREEMENT.
2
O.
"BUSINESS DAY" MEANS ANY DAY ON WHICH BANKS IN NEW YORK CITY ARE
OPEN FOR BUSINESS.
P.
"BUSINESS" HAS THE MEANING SET FORTH IN THE RECITALS TO THE
AGREEMENT.
Q.
"CERCLA" HAS THE MEANING SET FORTH IN SECTION 5.17(B) OF THE
AGREEMENT.
R.
"CERTIFICATE OF MERGER" HAS THE MEANING SET FORTH IN SECTION 2.2
OF THE AGREEMENT.
S.
"CLOSING" HAS THE MEANING SET FORTH IN SECTION 4 OF THE AGREEMENT.
T.
"CLOSING DATE" HAS THE MEANING SET FORTH IN SECTION 4 OF THE
AGREEMENT.
U.
"CLOSING ESCROW DEPOSIT" HAS THE MEANING SET FORTH IN SECTION
3.4(A) OF THE AGREEMENT.
V.
"CODE" MEANS THE INTERNAL REVENUE CODE OF 1986, AS AMENDED.
W.
"COMPANY" HAS THE MEANING SET FORTH IN THE PREAMBLE TO THE
AGREEMENT.
X.
"COMPETITIVE BUSINESS" HAS THE MEANING SET FORTH IN SECTION
8.13(C) OF THE AGREEMENT.
Y.
"CONSULTANT" HAS THE MEANING SET FORTH IN SECTION 3.4(E) OF THE
AGREEMENT.