Document:

EX-10.1

Execution Copy

ASSET PURCHASE AGREEMENT

Dated as of June 30, 2006

By and Among

DEFIANCE, INC.,

PRECISION ENGINE PRODUCTS CORP.

and

STANADYNE CORPORATION

1

TABLE OF CONTENTS

Page

1. Definitions

2. Acquisition of the Business by Buyer.

2.1. Purchase and Sale of PEPL Quotas and Acquired Assets

2.2. Excluded Assets

2.3. Assumption of Liabilities

2.4. Liabilities Not Assumed

2.5. Purchase Price

2.6. Purchase Price Adjustment.

2.7. Earn-Out.

2.8. The Closing

2.9. Deliveries at the Closing.

3. Representations and Warranties of Seller

3.1. Organization

3.2. Authorization of Transaction

3.3. Noncontravention; Governmental Authorities; Consents

3.4. Brokers’ Fees

3.5. Ownership of PEPL Quotas

3.6. Financial Statements.

3.7. Title to Assets

3.8. Legal and Other Compliance.

3.9. Taxes.

3.10. Property, Plant and Equipment.

3.11. Intellectual Property.

3.12. Environmental Matters.

3.13. Contracts

3.14. Litigation

3.15. Employee Benefit Plans

3.16. Labor Matters.

3.17. Product Warranties

3.18. Affiliated Transactions

3.19. Customers, Suppliers

3.20. Absence of Certain Changes

3.21. Insurance

3.22. Receivables

3.23. Inventory

3.24. Disclaimer of other Representations and Warranties

4. Representations and Warranties of Stanadyne

4.1. Organization

4.2. Authorization of Transaction

4.3. Noncontravention

4.4. Brokers’ Fees

4.5. Ownership of PEPL Quotas

5. Representations and Warranties of Buyer

5.1. Organization of Buyer

5.2. Authority for Agreement

5.3. Noncontravention

5.4. Financing

5.5. Broker’s Fees

6. Covenants

6.1. General

6.2. Notices and Consents

6.3. Operation of Business

6.4. Taxes.

6.5. Preservation of Business

6.6. Full Access.

6.7. Notice of Developments

6.8. Future Assurances

6.9. Employees and Employee Benefits.

6.10. Exclusivity

6.11. Termination of Related-Party Arrangements

6.12. Confidentiality

7. Conditions to Obligation to Close.

7.1. Conditions to Obligation of Buyer

7.2. Conditions to Obligations of Seller

8. Post-Closing Covenants.

8.1. Noncompetition and Nonsolicitation.

8.2. Accounts Receivable and Correspondence

8.3. Warranty Claims

9. Indemnification.

9.1. Indemnity by Seller.

9.2. Indemnity by Buyer.

9.3. Tax Treatment of Indemnity Payments

9.4. Matters Involving Third Parties.

9.5. Survival of Indemnification Claims

9.6. Fraud; Intentional Misrepresentation

9.7. Determination of Loss Amount.

9.8. Exclusive Remedy

10. Termination.

10.1. Termination of Agreement

10.2. Effect of Termination

11. Miscellaneous.

11.1. Press Releases and Public Announcements

11.2. No Third Party Beneficiaries

11.3. Entire Agreement

11.4. Succession and Assignment

11.5. Counterparts

11.6. Headings

11.7. Notices

11.8. No Additional Representations; Disclaimer

11.9. Governing Law

11.10. Amendments and Waivers

11.11. Severability

11.12. Expenses

11.13. Construction

11.14. Incorporation of Exhibits and Schedules

11.15. Consent to Jurisdiction; Venue; Service of Process.

11.16. Waiver of Jury Trial

11.17. Specific Performance

11.18. Bulk Sales Laws

	 
	Schedules
	 

	Schedule 2.1(c) — Intellectual Property

	 

	Schedule 2.2(h) — Other Excluded Assets

	 

	Schedule 2.4(g) — Assumed Debt

	 

	Schedule 2.6 — Closing Balance Sheet and Working Capital Example

	 

	Schedule 2.7(f)(vi) - Changes Reflected in EBITDA

	 

	Schedule 6.9(a) — Transferred Employees

	 

	Schedule 6.11 - Surviving Affiliated Transactions

	 

	Schedule 7.1(c) — Seller and Stanadyne Consents

	 

	Schedule 7.2(c) — Buyer Consents

	 

	Disclosure Schedule — Exceptions to Representations and Warranties

2

ASSET PURCHASE AGREEMENT

This Asset Purchase Agreement (the “Agreement”) is entered into on June 30, 2006, by
and among Defiance, Inc., a Delaware corporation (“Buyer”), Precision Engine Products
Corp., a Delaware corporation (“Seller”), and Stanadyne Corporation, a Delaware corporation
(“Stanadyne”). Buyer, Seller and Stanadyne are collectively referred to herein as the
“Parties.”

This Agreement contemplates a transaction in which Buyer shall purchase substantially all of
the assets of Seller and certain assets of Stanadyne, including the purchase of all of the issued
and outstanding quotas of Precision Engine Products LTDA, a commercial limited liability company
incorporated under the laws of Brazil (“PEPL” and, together with Seller, “PEP
Group”). The assets to be purchased by Buyer all relate to the design, manufacture and sale of
hydraulic valve lifters, including roller rocker arm assemblies, lash adjusters, roller rocker
arms, roller finger followers, tappets, roller tappets, roller valve lifters and slipper valve
lifters, as conducted by PEP Group at the Tallahassee Facility and/or the Curitiba Facility (the
“Business”). In consideration of the sale of such assets, Buyer shall assume certain
liabilities of Seller related to the Business and shall pay to Seller the Purchase Price (as
defined below).

Now, therefore, in consideration of the premises and the mutual promises herein made, and in
consideration of the representations, warranties, and covenants herein contained, the Parties agree
as follows.

1. Definitions. 

“Accounting Standards” means GAAP applied using the specific accounting policies and practices
as described on Section 3.6 of the Disclosure Schedule.

“Acquired Assets” has the meaning set forth in §2.1.

“Acquired Employee Plan” means each Employee Plan that is sponsored and maintained by PEPL and
is set forth in §3.15 of the Disclosure Schedule.

“Acquired Intellectual Property” means all Intellectual Property included in the Acquired
Assets.

“Action” means any claim, action, cause of action, suit, arbitration, inquiry, proceeding or
investigation by or before any Governmental Authority.

“Affiliate” means, as to any specified Person at any time, each Person directly or indirectly
controlling, controlled by or under direct or indirect common control with such specified Person at
such time.

“Agreement” has the meaning set forth in the preamble above.

“Allocation Schedule” has the meaning set forth in §2.6(d).

“Ancillary Agreements” means (i) a Deed of Transfer , (ii) a Bill of Sale, (iii) the Special
Warranty Deed; (iv) the Amendment to PEPL’s Articles of Organization reflecting the transfer by
Stanadyne and Seller of their interests in the PEPL Quotas; (v) the Transitional Services
Agreement; (vi) the Instrument of Assumption (the “Assumption Agreement”); (vii) the
Assignment of Patents and Trademarks, and (viii) a Supply Agreement between Buyer and Stanadyne
for the tappet assembly product for use in the “Integrated Fuel System”, in each case of (i) –
(viii) in a form mutually acceptable to Buyer and Seller.

“Assumed Liabilities” has the meaning set forth in §2.3.

“Basket” has the meaning set forth in §9.1(b).

“Brazilian Withholding Taxes” has the meaning set forth in §2.10.

“Business” has the meaning set forth in the recitals above.

“Business Day” means any day on which banking institutions in New York, New York are
customarily open for the purpose of transacting business.

“Buyer” has the meaning set forth in the preamble above.

“Buyer Indemnified Parties” has the meaning set forth in §9.1(a).

“Cap” has the meaning set forth in §9.1(b).

“Cash” means cash and cash equivalents (including marketable securities and short term
investments).

“CERCLA” has the meaning set forth in §3.12(c).

“Closing” has the meaning set forth in §2.8.

“Closing Date” has the meaning set forth in §2.8.

“Closing Balance Sheet” has the meaning set forth in §2.6(b)(i).

“Closing Date Statement” has the meaning set forth in §2.6(b)(i).

“Closing Working Capital” has the meaning set forth in §2.6(a)(i).

“COBRA” has the meaning set forth in §3.15(c).

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

“Confidential Information” means any and all information concerning the Business other than
that information which is already generally or readily obtainable by the public or is publicly
known or becomes publicly known through no fault of Buyer.

“Contracts” has the meaning set forth in §2.1(e).

“Contractual Obligation” means, with respect to any Person, any contract, agreement, purchase
order, deed, mortgage, lease, license, commitment, undertaking, arrangement or understanding, but
excluding the charter and by-laws of such Person, to which or by which such Person is a party, has
any rights or is otherwise subject or bound or to which or by which any property or right of such
Person is subject or bound, whether oral or written.

“Curitiba Facility” means the real property and buildings leased by PEP Group located at Rua
João Chede, 2713, Curitiba / Paranã, Brazil.

“Debt” of any Person means all obligations of such Person (i) for borrowed money, (ii)
evidenced by notes, bonds, debentures or similar instruments, (iii) for the deferred purchase price
of goods or services (other than trade payables or accruals incurred in the Ordinary Course of
Business), (iv) under capital leases, (v) under letters of credit or similar instruments and (vi)
in the nature of Guarantees of the obligations described in clauses (i) through (v) above of any
other Person.

“Disclosure Schedule” has the meaning set forth in §3.

“Earn-Out Amount” has the meaning set forth in §2.7(d).

“Earn-Out Income Statement” has the meaning set forth in §2.7(a).

“Earn-Out Objection Notice” has the meaning set forth in §2.7(a).

“Earn-Out Period” has the meaning set forth in §2.7(a).

“Earn-Out Threshold” has the meaning set forth in §2.7(d).

“EBITDA” has the meaning set forth in §2.7(f).

“Employee Plans” has the meaning set forth in §3.15.

“Enforceable” means, with respect to any Contractual Obligation, that such Contractual
Obligation is a legal, valid and binding obligation enforceable in accordance with its terms,
except to the extent that enforcement of the rights and remedies created thereby is subject to
bankruptcy, insolvency, reorganization, moratorium and other similar laws of general application
affecting the rights and remedies of creditors and to general principles of equity (regardless of
whether enforceability is considered in a proceeding in equity or at law).

“Environment” means any surface water, groundwater, land surface, subsurface strata, river
sediment, plant or animal life, natural resources, air (including indoor air and ambient air) and
soil.

“Environmental Claim” means any claim, action, cause of action, investigation or notice by
any person or entity alleging potential liability (including, without limitation, potential
liability for investigatory costs, cleanup costs, governmental response costs, natural resources
damages, property damages, personal injuries, or penalties) arising out of, based on or resulting
from (a) the presence or Release of any Substances at any location, whether or not owned or
operated by Seller, or (b) circumstances forming the basis of any violation, or alleged violation,
of any Environmental Laws.

“Environmental Laws” means any Legal Requirement in effect as of the Closing Date concerning:
(i) the Environment, including related to pollution, contamination, cleanup, preservation,
protection, and reclamation of the Environment; (ii) any Release or threatened Release of or
exposure to any Substance, including investigation, monitoring, clean up, removal, treatment, or
any other action to address such Release or threatened Release; (iii) human health as it relates to
exposure to Substances; and (iv) the Handling of Substances.

“Environmental Permits” means any licenses, permits, authorizations, orders, registrations,
certificates, approvals, consents, and franchises issued under Environmental Laws.

“ERISA” has the meaning set forth in §3.15(a).

“Estimated Working Capital” has the meaning set forth in §2.6(a)(i).

“Estimated Closing Balance Sheet” has the meaning set forth in §2.6(a)(i).

“Excluded Assets” has the meaning set forth in §2.2.

“Excluded Liabilities” has the meaning set forth in §2.4.

“Final Closing Balance Sheet” has the meaning set forth in §2.6(b)(iv)(iii).

“Final Closing Date Statement” has the meaning set forth in §2.6(b)(iv)(iii).

“Final Earn-Out Income Statement” has the meaning set forth in §2.7(a).

“Financial Statements” has the meaning set forth in §3.6.

“Foreign Plans” has the meaning set forth in §3.15(e).

“GAAP” means United States generally accepted accounting principles.

“Governmental Authority” means any United States federal, state or local or any foreign
government, governmental authority, regulatory or administrative agency, governmental commission,
court or tribunal (or any department, bureau or division thereof) or any arbitral body.

“Guarantee” means (i) any guarantee of the payment or performance of, or any contingent
obligation in respect of, any Debt or other obligation of any other Person, (ii) any other
arrangement whereby credit is extended to one obligor on the basis of any promise or undertaking of
another Person (A) to pay the Debt or other obligation of such obligor, (B) to purchase any
obligation owed by such obligor, (C) to purchase or lease assets (other than inventory in the
Ordinary Course of Business) under circumstances that would enable such obligor to discharge one or
more of its obligations or (D) to maintain the capital, working capital, solvency or general
financial condition of such obligor and (iii) any liability as a general partner of a partnership
or as a venturer in a joint venture in respect of indebtedness or other obligations of such
partnership or venture.

“Handling of Substances” means the production, use, generation, Release, storage, treatment,
formulation, processing, labeling, distribution, introduction into commerce, registration,
transportation, reclamation, recycling, or other disposition of, or exposure to, Substances.

“Income Taxes” means any federal, state, local or foreign Tax based on or measured by
reference to net income (including gains and capital gains), including any interest, penalty or
addition thereto, whether disputed or not.

“Indemnified Party” has the meaning set forth in §9.4(a).

“Indemnifying Party” has the meaning set forth in §9.4(a).

“Independent Accountants” has the meaning set forth in §2.6(b)(iii).

“Intellectual Property” means domestic and foreign patents, copyrights, Trademarks, trade
secrets, Internet domain names, all pending applications for any of the foregoing, and any
Contractual Obligations granting rights related to the foregoing (i) subsisting in, covering,
reading on, directly applicable to or existing in the Products or Technology, including, without
limitation, all Intellectual Property identified in Schedule 2.1(c) or (ii) that are owned,
licensed or controlled in whole or in part by Seller and relate exclusively to the Business.

“Interim Balance Sheet” has the meaning set forth in §3.6.

“Interim Financials” has the meaning set forth in §3.6.

“Inventory” or “Inventories” means all finished goods, work in process, raw materials, and all
other materials and supplies (including such items as are in transit to Seller, being held in stock
for Seller or have been ordered by Seller prior to Closing and (i) have been paid for by Seller or
are reflected in the accounts payable used in calculating the Closing Working Capital, and (ii) are
included in the Inventory used in calculating the Closing Working Capital) held for use or
consumption by Seller or Buyer in the production of the Products.

“Knowledge” means the actual knowledge of Stephen Langin, Shawn Sullivan, Richard Cerini, Doug
Mattson, and Silvio Henrique, after reasonable investigation.

“Kohlberg” means Kohlberg Management IV, L.L.C., a Delaware limited liability company.

“Legal Requirement” means any federal, state, local or foreign law, statute, standard,
ordinance, code, order, rule, regulation, resolution or promulgation, or any order, injunction,
common law, judgment or decree of any Governmental Authority, or any license, franchise, permit or
similar right granted under any of the foregoing, or any similar provision having the force and
effect of law.

“Liability” means any liability or obligation (whether known or unknown, whether asserted or
unasserted, whether absolute or contingent, whether accrued or unaccrued, whether liquidated or
unliquidated, whether incurred or consequential and whether due or to become due), including any
liability for Taxes.

“Lien” means any mortgage, pledge, lien, security interest, charge, adverse or prior claim,
encumbrance, restriction on transfer, conditional sale or other title retention device or
arrangement (including without limitation a capital lease), easement, right-of-way, encroachment,
building or use restriction, transfer for the purpose of subjection to the payment of any Debt or
other obligation, or restriction on the creation of any of the foregoing, whether relating to any
property or right or the income or profits therefrom.

“Losses” has the meaning set forth in §9.1(a).

“Material Adverse Effect” means any change in or effect on the Business or the Acquired Assets
that, when considered either singly or in the aggregate, has had or would reasonably be expected to
have a material adverse effect on the business, operations, results of operations, condition
(financial or otherwise) or Liabilities of the Business, or on the Acquired Assets, or on the
ability of Seller to consummate the transactions contemplated hereby, except any adverse effect
related to or resulting from (i) events affecting the United States or global economy or capital or
financial markets generally which do not disproportionately affect the Business, or (ii) changes in
laws, regulations or GAAP, or in the authoritative interpretations thereof or in regulatory or
interpretive guidance related thereto which, in each case, do not disproportionately affect the
Business, or (iii) this Agreement, the announcement thereof, the transactions contemplated hereby
and the identity or involvement by Buyer or its Affiliates.

“Material Contract” has the meaning set forth in §3.13.

“Michigan Lease” means Seller’s leasehold interest in the property located at 100 West Big
Beaver Road, Suite 200, Troy, MI 48084.

“Most Recent Fiscal Year End Balance Sheet” has the meaning set forth in §3.6.

“Notice of Disagreement” has the meaning set forth in §2.6(b)(ii).

“Ordinary Course of Business” means the ordinary course of business consistent with past
custom and practice (including with respect to quantity and frequency) of the Person in question.

“Organizational Documents” has the meaning set forth in §3.1.

“Owned Real Properties” has the meaning set forth in §3.10(a).

“Party” and “Parties” have the meanings set forth in the preamble above.

“PEP Group” has the meaning set forth in the recitals above.

“PEPL” has the meaning set forth in the recitals above.

“PEPL Quotas” means the Seller Quotas and the Stanadyne Quota, representing all of the issued
and outstanding quotas in the capital of PEPL.

“Permitted Lien” means (i) statutory liens for Taxes to the extent that the payment thereof is
not in arrears or otherwise due, (ii) encumbrances in the nature of zoning restrictions, easements,
rights or restrictions of record on the use of real property if the same do not impair its use in
the Business as currently conducted, (iii) statutory or common law liens to secure landlords,
lessors or renters under leases or rental agreements confined to the premises rented to the extent
that no payment or performance under any such lease or rental agreement is in arrears or is
otherwise due, (iv) deposits or pledges made in connection with, or to secure payment of, worker’s
compensation, unemployment insurance, old age pension programs mandated under applicable Legal
Requirements or other social security and (v) statutory or common law liens in favor of carriers,
warehousemen, mechanics and materialmen, statutory or common law liens to secure claims for labor,
materials or supplies and other like liens arising in the Ordinary Course of Business, which secure
obligations to the extent that payment thereof is not in arrears or otherwise due.

“Person” means an individual, a partnership, a corporation, an association, a joint stock
company, a limited liability company, a trust, a joint venture, an unincorporated organization, or
a Governmental Authority.

“Post-Closing Tax Period” has the meaning set forth in §3.9(g).

“Pre-Closing Environmental Matters” means (i) the Handling of Substances on or prior to the
Closing Date either in, on, under or from any Seller Property including the effects of such
Handling of Substances on resources, Persons or real or personal property within or outside the
boundaries of any Seller Property, (ii) the presence or Release as of or prior to the Closing Date
of Substances in, on or under any Seller Property regardless of how the Substances came to rest at,
on or under such Facility, (iii) the failure on or prior to the Closing Date of the Seller or PEPL
or any of their subsidiaries to be in compliance with any Environmental Laws, (iv) any actual
liability pursuant to CERCLA or any similar Environmental Laws related to any Release of Substances
or any other act or omission on or prior to the Closing Date; (v) any other act, omission or
condition existing or occurring with respect to any Acquired Assets, Seller Properties or the
Business on or prior to the Closing Date which give rise to liability under any Environmental Laws;
and (vi) any Environmental Claims arising out of events, conditions or circumstances occurring on
or prior to the Closing Date.

“Pre-Closing Tax Period” has the meaning set forth in §3.9(b).

“Products” means all products and services of Seller relating exclusively to the Business.

“Purchase Price” has the meaning set forth in §2.5.

“Purchase Price Adjustment” has the meaning set forth in §2.6.

“Real Property Leases” has the meaning set forth in §3.10(b).

“Release” means any release, spill, emission, discharge, leaking, pumping, injection, deposit,
disposal, dispersal, leaching or migration of Substances into the indoor or outdoor environment
(including, without limitation, ambient air, surface water, groundwater and surface or subsurface
strata) or into or out of any property, including the movement of Substances through or in the air,
soil, surface water, groundwater or property.

“Seller” has the meaning set forth in the preamble.

“Seller Indemnified Parties” has the meaning set forth in §9.2.

“Seller Permits” has the meaning set forth in §3.8.

“Seller Property” has the meaning set forth in §3.10(b).

“Seller Quotas” has the meaning set forth in §3.5.

“Seller’s Tax Contest Claim” has the meaning set forth in §6.4(e).

“Special Warranty Deed” means the special warranty deed for the transfer of the Owned Real
Properties in the form attached as Exhibit A-3.

“Stanadyne” has the meaning set forth in the preamble.

“Stanadyne Affiliates” means the Affiliates of Stanadyne and Seller other than (i) Kohlberg
and (ii) any Persons that would not be Affiliates of Stanadyne if they were not otherwise
Affiliates of Kohlberg.

“Stanadyne Quota” has the meaning set forth in §4.5.

“Straddle Period” has the meaning set forth in §6.4(d).

“Substances” means any waste, substance, product, pollutant or material, whether solid, liquid
or gaseous, that (i) is or includes asbestos, polychlorinated biphenyls, radioactive materials,
oil, petroleum or any fraction thereof, (ii) requires removal, remediation or reporting under any
Environmental Law, or is defined, listed or identified as a “contaminant”, “pollutant”, “toxic
substance”, “toxic material”, “hazardous waste” or “hazardous substance” or words of similar
meaning and regulatory effect thereunder or (iii) is toxic, explosive, corrosive, flammable,
infectious, radioactive, carcinogenic, mutagenic or otherwise hazardous and is regulated as such by
any Governmental Authority under any Environmental Law.

“Tallahassee Facility” means the real property and buildings owned by Seller located at 2919
Commonwealth Boulevard, Tallahassee, Florida 32303 and used in the conduct of the Business.

“Target Working Capital” has the meaning set forth in §2.6(a)(ii).

“Tax” or “Taxes” means any federal, state, local, or foreign income, gross receipts, license,
payroll, employment, excise, severance, stamp, occupation, premium, windfall profits, customs
duties, capital stock, franchise, profits, withholding, social security (or similar, including
FICA), unemployment, disability, real property, personal property, sales, use, transfer,
registration, value added, alternative or add-on minimum, estimated, or other tax of any kind
whatsoever, including any interest, penalty, or addition thereto.

“Tax Contest Claims” has the meaning set forth in §6.4(e).

“Tax Return” means any return, declaration, report, claim for refund, or information return or
statement relating to Taxes, including any schedule or attachment thereto, and including any
amendment thereof.

“Technology” means all inventions, utility models, copyrightable works, discoveries,
innovations, know-how, software and proprietary information (including formulas, compositions,
processes and techniques, technical data, designs, drawings, specifications, customer and supplier
lists, pricing and cost information, business and marketing plans and proposals, documentation, and
manuals), whether or not protectible or protected by patent, copyright, mask work right, trade
secret law or otherwise, in each case relating exclusively to the Business.

“Termination Date” has the meaning set forth in §9.5.

“Third Party Claim” has the meaning set forth in §9.4(a).

“Trademarks” means any trademarks, service marks, trade dress, and logos, together with all
translations, adaptations, derivations, and combinations thereof and including all goodwill
associated therewith.

“Transfer” has the meaning set forth in §6.3(a).

“Transferred Employees” has the meaning set forth in §6.9(a).

“Transferred Employee Records” has the meaning set forth in §2.1(k).

“Transitional Services Agreement” means that certain Transitional Services Agreement entered
into by and between Buyer, Seller and Stanadyne on the Closing Date.

“WARN” means the Worker Adjustment and Retraining Act of 1988, as from time to time in effect.

“Warranty Claims” means claims for replacement for defective Products that are specifically
permitted under Seller’s warranties in effect as of the Closing Date.

2. Acquisition of the Business by Buyer.

2.1. Purchase and Sale of PEPL Quotas and Acquired Assets. At the Closing, Seller and
Stanadyne shall sell, convey, transfer, assign and deliver to Buyer, and Buyer shall purchase and
acquire from Seller and Stanadyne, subject to the exclusions contained in §2.2 and subject to and
upon the other terms and conditions contained herein, all of Seller’s and Stanadyne’s right, title
and interest in and to the PEPL Quotas and the following assets, properties and rights of PEP Group
(collectively, the “Acquired Assets”), free and clear of all Liens other than Permitted
Liens, and no other properties or assets of PEP Group or Stanadyne:

(a) all tangible personal property of PEP Group (such as machinery, equipment, spare
parts, control systems, inventories, raw materials, supplies, manufactured and purchased
parts, works in progress, finished goods, computer and office equipment, furniture,
automobiles, trucks, tractors, trailers, tools, jigs and dies) which is used or held for
use primarily in the conduct of the Business on the date hereof, and all such assets of
PEP Group that are acquired after the date hereof and prior to the Closing for use
primarily in the Business (in each case other than assets that have been disposed of in
the Ordinary Course of Business and in accordance with the terms of this Agreement),
including without limitation all such assets located at the Tallahassee Facility and the
Curitiba Facility;

(b) all rights of PEP Group under transferable licenses (other than as set forth in
§2.1(c)), permits, authorizations, orders, registrations, certificates, approvals,
consents and franchises used or held for use primarily in connection with the conduct of
the Business or any pending applications or renewals relating to any of the foregoing,
including without limitation any Environmental Permits;

(c) all Intellectual Property and Technology owned, licensed or controlled by PEP
Group used exclusively or held for use exclusively in the conduct of the Business,
goodwill associated therewith, licenses and sublicenses granted in respect thereto and
rights thereunder, remedies against infringements thereof and rights to protection of
interest therein, including without limitation the Intellectual Property and software
described in Schedule 2.1(c);

(d) all papers, books and records primarily related to the Business in whatever form,
including all customer lists and files and supplier lists and files primarily related to
the Business;

(e) all rights of PEP Group under Contractual Obligations relating primarily to the
conduct of the Business (the “Contracts”), except as expressly set forth in
Section 2.2;

(f) all of PEP Group’s rights to the use of the name “Precision Engine Products”;

(g) all accounts receivable as of the Closing Date related exclusively to the
Business;

(h) all other current assets of PEP Group, excluding Cash;

(i) all leasehold interests held for use primarily in the conduct of the Business
(including without limitation the leasehold interest in the Curitiba Facility) other than
the Michigan Lease;

(j) all prepaid rent, prepaid property and ad valorem Taxes (but only as and to the
extent reflected on the Final Closing Balance Sheet), prepaid supplies, advances and other
prepaid expenses and deposits to the extent primarily related to the Business;

(k) all records of Seller that relate primarily to the Transferred Employees, but
only to the extent that such records may be transferred under applicable Legal
Requirements (the “Transferred Employee Records”)

(l) all claims, deposits, refunds, causes of action, choses in action, rights of
recovery, rights of set off and rights of recoupment, to the extent they are transferable
to Buyer and continue after Closing;

(m) all amounts owed to Seller by PEPL pursuant to intercompany notes and accounts,
including the Intercompany Notes set forth on §2.4(g) of the Disclosure Schedule; and

(n) the Owned Real Properties, and all buildings, improvements, fixtures and fittings
thereon, and easements, rights-of-way and other appurtenants thereto.

2.2. Excluded Assets. There shall be excluded from the Acquired Assets to be sold and
transferred to Buyer hereunder, and, to the extent in existence on the Closing Date, Seller and
Stanadyne shall retain all of Seller’s and Stanadyne’s right, title and interest in and to the
following assets, properties and rights of Seller (collectively, the “Excluded Assets”):

(a) Cash;

(b) the consideration delivered to Seller by Buyer pursuant to this Agreement;

(c) all claims, deposits, refunds, causes of action, choses in action, rights of
recovery, rights of set off and rights of recoupment which have, and to the extent they
have, arisen in connection with the conduct of the Business by Seller;

(d) all Employee Plans, except Acquired Employee Plans, and assets related thereto;

(e) all rights in and with respect to insurance policies of Seller, except for any
proceeds of such insurance and claims therefor relating to the Acquired Assets;

(f) all financial, computer and human resource systems of Stanadyne used by Seller,
whether or not used primarily in the conduct of the Business, including those to be used
in providing services to Buyer under the Transitional Services Agreement;

(g) all rights to the name “Stanadyne”;

(h) all assets described on Schedule 2.2(h);

(i) for the avoidance of doubt, all deferred Tax assets and prepaid Taxes other than
those described in §2.1(j);

(j) any obligations under Seller’s leasehold interest in the Michigan Lease;

provided, however, that the assets set forth on Schedule 2.2(k) shall be provided
to Buyer under the Transitional Services Agreement and the Transitional Services Agreement shall
provide that, prior to the end of the term during which such assets are provided to Buyer under the
Transitional Services Agreement, Buyer may elect to acquire all or any of such assets to the extent
they are transferable, and Seller and Stanadyne shall cooperate with Buyer to obtain any consents
required in connection with the transfer of any such assets to Buyer.

2.3. Assumption of Liabilities. At the Closing, Buyer shall deliver to Seller the
Assumption Agreement, whereby on the terms and subject to the conditions set forth herein and
except as excluded by §2.4 hereof, Buyer shall undertake, assume, agree to satisfy or perform when
due and hold Seller harmless from and indemnify Seller against the following Liabilities of Seller
(the “Assumed Liabilities”):

(a) all Liabilities under the Contracts, to the extent performance is due after the
Closing Date or relating to events occurring after the Closing Date;

(b) all Liabilities incurred by Seller in the Ordinary Course of Business as
reflected on the Final Closing Balance Sheet;

(c) all Liabilities for non-Income Taxes relating to the Business (but only as and to
the extent reflected on the Final Closing Balance Sheet); and

(d) accounts payable of Seller, to the extent they are related to the Business and
reflected on the Final Closing Balance Sheet.

2.4. Liabilities Not Assumed. Except as expressly set forth in this Agreement, Buyer
shall not assume or perform any Liabilities not covered in §2.3 hereof nor any of the following
Liabilities (the “Excluded Liabilities”):

(a) any Liability of Seller that does not relate primarily to the conduct of the
Business or the Acquired Assets or that has not been incurred in the Ordinary Course of
Business;

(b) any Liability owing from Seller or the Business to any Affiliate of Seller other
than any Liability incurred in the Ordinary Course of Business to Holley Performance
Products, Inc.;

(c) any Liability of Seller for Income Taxes whether or not relating to the Business
and whether or not incurred prior to the Closing;

(d) except as provided in §11.12, any Liability for non-Income Taxes relating to the
Business for periods or portions thereof ending prior to the Closing Date and not
reflected on the Final Closing Balance Sheet;

(e) any Liability arising out of or related to any Action against Seller or any
Action which adversely affects the Acquired Assets and which shall have been asserted on
or prior to the Closing Date;

(f) any Liability (including any Liability for Warranty Claims) that relates to
Products manufactured or sold on or prior to the Closing Date by Seller;

(g) any Debt of Seller or the Business, except as set forth on Schedule
2.4(g);

(h) any obligation of Seller to indemnify any Person by reason of the fact that such
Person was a director, officer, employee or agent of Seller or was serving at the request
of Seller as a partner, trustee, director, officer, employee or agent of another entity
(whether such indemnification is for judgments, damages, penalties, fines, costs, amounts
paid in settlement, losses, expenses or otherwise, and whether such indemnification is
pursuant to any statute, charter document, bylaw, agreement or otherwise);

(i) any Liability of Seller for costs and expenses incurred in connection with this
Agreement, the making or performance of this Agreement and the transactions contemplated
hereby;

(j) any Liability of Seller under this Agreement;

(k) except with respect to Liabilities assumed pursuant to §2.3(b) related to
Transferred Employees or as provided in §6.9, any Liability to or in respect of, or
arising out of or in connection with, the employment by Seller or cessation of employment
by Seller of any employees or former employees of Seller on or prior to the Closing Date,
including without limitation (i) any employment agreement, whether or not written, between
Seller and any person, (ii) any Liability under any Employee Plan, other than a Liability
with respect to an Acquired Employee Plan, (iii) any severance obligation of Seller, (iv)
any claim of an unfair labor practice or grievance or any claim under any unemployment
compensation, employment standards, pay equity or worker’s compensation law or regulation
or under any federal, state, provincial or foreign employment discrimination law or
regulation, which shall have been asserted on or prior to the Closing Date or is based on
acts or omissions which occurred on or prior to the Closing Date, whether or not the
affected employees are hired by Buyer, (v) any Liability relating to payroll, vacation or
sick pay for any current or former employee, director, officer, consultant or independent
contractor of Seller other than with respect to Transferred Employees, and (vi) with
respect to any actual or alleged agreements or promises to current or former employees,
directors, officers, consultants or independent contractors regarding stock options,
equity or equity based compensation plans, programs or arrangements maintained by Seller;

(l) any Liability of Seller for accounts payable not included in the calculation of
Closing Working Capital; and

(m) all Liabilities for Pre-Closing Environmental Matters.

2.5. Purchase Price. Buyer agrees to assume the Assumed Liabilities and to pay to
Seller at the Closing an amount in cash equal to Twenty-Five Million Dollars ($25,000,000.00) (the
“Purchase Price”), adjusted by any Purchase Price adjustment pursuant to §2.6(a), payable
by wire transfer of immediately available funds in accordance with written instructions of Seller
given to Buyer not less than two (2) Business Days prior to the Closing Date.

2.6. Purchase Price Adjustment.

(a) Pre-Closing Purchase Price Adjustments.

(i) No later than two (2) business days prior to the Closing Date, Seller shall
deliver to Buyer an estimated consolidated balance sheet of the Business as of
immediately prior to the Closing (the “Estimated Closing Balance Sheet”),
together with a written statement setting forth in reasonable detail Seller’s good
faith estimate of the Closing Working Capital (the “Estimated Working
Capital”). The Estimated Closing Balance Sheet shall be prepared in accordance
with the Accounting Standards, applied in a manner consistent with the preparation
of the Interim Balance Sheet. “Closing Working Capital” shall mean (A) the
current assets of the Business (excluding Cash and Excluded Assets) minus (B) the
current liabilities of the Business (excluding Excluded Liabilities, any reserve for
warranty claims or returns and giving effect to Seller’s payment of any payables on
the Closing Date), all as reflected on the Closing Balance Sheet and the records of
Seller maintained in the Ordinary Course of Business and calculated in accordance
with the Accounting Standards applied in a manner consistent with the preparation of
the Interim Balance Sheet. For illustrative purposes only, attached as Schedule
2.6 hereto is a sample Closing Balance Sheet and calculation of Closing Working
Capital, assuming that the Closing occurred on May 31, 2006.

(ii) On the Closing Date, the Purchase Price described in §2.5 shall be
adjusted by either (A) subtracting the amount, if any, by which Estimated Working
Capital is less than $9,778,518 (“Target Working Capital”) or (B) adding the
amount by which Estimated Working Capital is greater than Target Working Capital.

(b) Preparation of Closing Date Statement.

(i) Within 45 days after the Closing Date, Seller shall deliver to Buyer a
consolidated balance sheet of the Business as of the Closing Date (the “Closing
Balance Sheet”), together with a written statement (the “Closing Date
Statement”) setting forth in reasonable detail (A) Seller’s determination of the
Closing Working Capital and (B) the amount of any adjustment to the Purchase Price
to be paid and by whom pursuant to §2.6(c) and the basis therefor. The Closing
Balance Sheet shall be prepared in accordance with the Accounting Standards, applied
in a manner consistent with the preparation of the Interim Balance Sheet, without
giving effect to the changes to the balance sheet as a result of the transactions
contemplated hereby.

(ii) Following the Closing, each of Buyer and Seller shall give the other party
reasonable access at all reasonable times to the properties, books, records and
personnel of the Business for purposes of preparing, reviewing and resolving any
disputes concerning the Closing Date Statement. Buyer shall have 30 days following
the delivery to Buyer of the Closing Date Statement during which to provide written
notice to Seller of any dispute of any item contained in the Closing Balance Sheet
or Closing Date Statement (a “Notice of Disagreement”), which notice shall
set forth in reasonable detail any item on the Closing Balance Sheet and/or the
Closing Date Statement that Buyer believes (a) has not been prepared in accordance
with the Accounting Standards, applied in a manner consistent with the preparation
of the Interim Balance Sheet, or in accordance with the definition of Closing
Working Capital set forth herein, or (b) contains a mathematical error. If Buyer
fails to provide a Notice of Disagreement to Seller within such 30-day period, the
Closing Balance Sheet and the Closing Date Statement shall be conclusive and binding
on the Parties. In the event that Buyer shall provide a Notice of Disagreement to
Seller within such 30-day period, Buyer and Seller shall cooperate in good faith to
resolve the dispute as promptly as possible.

(iii) If Buyer timely provides a Notice of Disagreement to Seller, and if Buyer
and Seller fail to resolve the dispute with respect to the Closing Balance Sheet,
the Closing Date Statement and the calculation of the Closing Working Capital within
thirty 30 days of Seller’s receipt of the Notice of Disagreement, Buyer and Seller
shall submit the issues remaining in dispute to Ernst & Young LLP (the
“Independent Accountants”) for resolution applying the Accounting Standards;
provided, however, that the Independent Accountants shall be limited
to selecting either the Closing Working Capital amount reflected on Seller’s Closing
Statement or the Closing Working Capital amount reflected on the Notice of
Disagreement submitted by Buyer. If issues are submitted to the Independent
Accountants for resolution, (A) Buyer and Seller shall furnish or cause to be
furnished to the Independent Accountants such work papers and other documents and
information relating to the disputed issues as the Independent Accountants may
request and are available to that party or its agents and shall be afforded the
opportunity to present to the Independent Accountants any material relating to the
disputed issues and to discuss the issues with the Independent Accountants; (B)
Buyer and Seller shall instruct the Independent Accountants to review only those
items and amounts specifically set forth and objected to in the Notice of
Disagreement, to make their determination based solely on such materials presented
by Buyer and Seller (i.e., not on the basis of an independent review) and to resolve
the dispute with respect to each such specified item and amount in accordance with
the Accounting Standards, applied in a manner consistent with the preparation of the
Interim Balance Sheet, and in accordance with the definition of Closing Working
Capital set forth in this Agreement; (C) the determination of the Closing Balance
Sheet and the Closing Working Capital by the Independent Accountants, as set forth
in a notice to be delivered to both Buyer and Seller within sixty (60) days of the
submission to the Independent Accountants of the issues remaining in dispute (or as
soon thereafter as practicable), shall be final, binding and conclusive on the
parties; and (D) the fees and costs of the Independent Accountants shall be borne
(x) by Buyer if the Independent Accountants select the Closing Balance Sheet and/or
Seller’s calculation of Closing Working Capital reflected on the Closing Statement,
or (y) by Seller, if the Independent Accountants select Buyer’s Closing Balance
Sheet or calculation of the Closing Working Capital reflected on the Notice of
Disagreement. The Closing Balance Sheet and the Closing Date Statement, either as
agreed to by Buyer and Seller or as determined by the Independent Accountants
pursuant to this paragraph, shall be final and binding and shall be referred to
respectively as the “Final Closing Balance Sheet” and the “Final Closing
Date Statement.”

(iv) No objection may be raised and no adjustment may be proposed to any entry
or item contained in the Closing Balance Sheet or the Closing Date Statement except
on the grounds that such item or entry is not in accordance with the provisions of
this Agreement or the Accounting Standards, applied in a manner consistent with the
preparation of the Interim Balance Sheet, or that such item or entry contains a
mathematical error.

(c) Post-Closing Purchase Price Adjustments.

(i) On the tenth business day following the determination of the Final Closing
Date Statement; either (A) Buyer shall pay to Seller the amount by which (x) Closing
Working Capital as set forth in the Final Closing Date Statement is greater than (y)
the Estimated Working Capital, or (B) Seller shall pay to Buyer the amount by which
(x) Closing Working Capital as set forth in the Final Closing Date Statement is less
than (y) the Estimated Working Capital.

(ii) The amount referred to in §2.6(c)(i) shall be paid by the paying party
under §2.6(c)(i) by wire transfer in immediately available funds to an account
designated by the other party.

(iii) Buyer or Seller may offset any amounts currently due to it from the other
Party under this Agreement against any amounts currently due from it to the other
Party under this §2.6(c).

(d) The Parties agree that $29,000 of the total consideration, as determined for tax
purposes, will be allocated to the PEPL Quotas. The Parties agree that the total
consideration, as determined for tax purposes (less the amount allocated to the PEPL
Quotas), paid for the Acquired Assets, will be allocated to such assets in accordance with
Section 1060 of the Code and the rules and regulations promulgated thereunder and any
similar provision of state, local and foreign law, as appropriate. Seller shall provide
Buyer with a proposed schedule detailing such allocation within ninety (90) days following
the Closing Date (the “Allocation Schedule”), and Seller and Buyer shall mutually
agree on a final allocation within 75 days thereafter. The purchase price allocation
shall be revised for any adjustments to the total consideration paid hereunder as
necessary, including for adjustment pursuant to §2.7, as mutually agreed to by Seller and
Buyer. Except as otherwise required by law, the parties to this Agreement will file all
Tax Returns and information reports in a manner consistent with the Allocation Schedule;
provided, however, that nothing contained herein shall prevent Buyer,
Stanadyne or Seller from settling any proposed deficiency or adjustment by any taxing
authority based upon or arising out of the purchase price allocation, and none of Buyer,
Seller and Stanadyne shall be required to litigate before any court, any proposed
deficiency or adjustment by any taxing authority challenging such purchase price
allocation. The parties will promptly inform one another of any challenge by any
governmental authority to any allocation made in accordance with the Allocation Schedule,
and the parties agree to consult and keep one another informed with respect to the status
of, and any discussion, proposal or submission with respect to, such challenge.

2.7. Earn-Out.

(a) As promptly as practicable after the one year anniversary of the Closing Date,
but in no event later than ninety (90) days thereafter, Buyer shall deliver to Seller a
statement of income (loss) of the Business as operated by Seller, Buyer or its successors
or assigns (the “Earn-Out Income Statement”) for the period starting on (x) if the
Closing Date occurs on or before the fifteenth fiscal day of the month in which the
Closing occurs, the first fiscal day of such month or (y) if the Closing Date occurs after
the fifteenth fiscal day of the month in which the Closing occurs, the first fiscal day of
the month immediately following the Closing Date (the date referred to in (x) or (y), the
“Earn Out Start Date”) until the last fiscal day of the month that is twelve
months after the Earn Out Start Date (the “Earn-Out Period”), including, without
limitation, a calculation of EBITDA (as defined below) for the Earn-Out Period. The
Earn-Out Income Statement shall be prepared in accordance with the Accounting Standards
applied in a manner consistent with the preparation of the Interim Statements. The
portion of such statement covering the year ended December 31, 2006 shall be included in
the consolidated financial statements audited by Buyer’s accounting firm. During the
Earn-Out Period, Buyer shall use commercially reasonable efforts to operate the Business
in the Ordinary Course of Business in a commercially reasonable fashion (including by not
taking any action or making any operational changes having the principal purpose of
reducing EBITDA) and shall maintain books and records adequate to permit an audit of the
Business as a stand-alone division. Without limiting the generality of the foregoing,
Buyer agrees and covenants that, during the Earn-Out Period, (i) Buyer will not divert any
business opportunity relating to the Products, customers or sales of Products from Buyer
to any of Buyer’s Affiliates or other business divisions; (ii) Buyer will continue to
manufacture Products so long as, in Buyer’s good faith judgment, sufficient demand exists
for such Products (and if Buyer determines that sufficient demand does not exist, Buyer
will provide supporting documentation, such as written communication from customers, to
that effect), in order to meet such demand; and (iii) all sales of Products, whether
effected by Buyer or an Affiliate of Buyer, will be included in the calculation of EBITDA;
provided, however  ̧ that none of the obligations in clauses (i) through (iii) above shall
apply to any products of a type that Buyer can demonstrate was manufactured by Buyer or an
Affiliate of Buyer prior to Closing.

(b) Following the one year anniversary of the Closing Date, each of Buyer and Seller
shall give the other party reasonable access at all reasonable times to the properties,
books, records and personnel of the Business for purposes of preparing, reviewing and
resolving any disputes concerning the Earn-Out Income Statement. Seller shall have 30
days following the delivery to Seller of the Earn-Out Income Statement during which to
provide written notice to Buyer of any dispute of any item contained in the Earn-Out
Income Statement (the “Earn-Out Objection Notice”), which notice shall set forth
in reasonable detail the basis for such dispute and Seller’s calculation of EBITDA for the
Earn-Out Period. If Seller fails to provide an Earn-Out Objection Notice to Buyer within
such 30-day period, the Earn-Out Income Statement shall be conclusive and binding on the
Parties. In the event that Seller shall provide an Earn-Out Objection Notice to Buyer
within such 30-day period, Buyer and Seller shall cooperate in good faith to resolve the
dispute as promptly as possible and agree upon a mutually satisfactory income statement
which reflects EBITDA for the Earn-Out Period. If Seller timely provides an Earn-Out
Objection Notice to Buyer, and if Buyer and Seller are unable to resolve such objections
within 30 days of Buyer’s receipt of the Earn-Out Objection Notice, Buyer and Seller shall
submit the items remaining in dispute to the Independent Accountant; provided,
however, that the Independent Accountants shall be limited to selecting either the
EBITDA amount reflected on Buyer’s Earn-Out Income Statement or the EBITDA amount
reflected on the Earn-Out Objection Notice submitted by Seller. If issues are submitted
to the Independent Accountants for resolution, (A) Buyer and Seller shall furnish or cause
to be furnished to the Independent Accountants such work papers and other documents and
information relating to the disputed issues as the Independent Accountants may request and
are available to that party or its agents and shall be afforded the opportunity to present
to the Independent Accountants any material relating to the disputed issues and to discuss
the issues with the Independent Accountants; (B) Buyer and Seller shall instruct the
Independent Accountants to make their determination based solely on such materials
presented by Buyer and Seller (i.e., not on the basis of an independent review) and to
resolve the dispute with respect to each such specified item and amount in accordance with
the Accounting Standards, applied in a manner consistent with the preparation of the
Interim Statements, and in accordance with the definition of EBITDA set forth in this
Agreement; (C) the determination of EBITDA for the Earn-Out Period by the Independent
Accountants, as set forth in a notice to be delivered to both Buyer and Seller within
sixty (60) days of the submission to the Independent Accountants of the issues remaining
in dispute (or as soon thereafter as practicable), shall be final, binding and conclusive
on the parties; and (D) the fees and costs of the Independent Accountants shall be borne
(x) by Seller if the Independent Accountants select Buyer’s calculation of EBITDA for the
Earn-Out Period reflected on the Earn-Out Income Statement, or (y) by Buyer, if the
Independent Accountants select Seller’s calculation of EBITDA for the Earn-Out Period
reflected on the Earn-Out Objection Notice. The Earn-Out Income Statement, either as
agreed to by Buyer and Seller or as determined by the Independent Accountants pursuant to
this paragraph, shall be final and binding and shall be referred to as the “Final
Earn-Out Income Statement” for the respective Earn-Out Period. Any amounts to be paid
pursuant to §2.7(d) below shall be paid within fifteen (15) days of the determination of
the Final Earn-Out Income Statement for such Earn-Out Period.

(c) No objection may be raised and no adjustment may be proposed to any entry or item
contained in the Earn-Out Income Statement or the calculation of EBITDA (as defined
below), except on the grounds that such item or entry is not in accordance with the
provisions of this Agreement or the Accounting Standards, applied in a manner consistent
with the preparation of the Interim Statements, or that such item or entry contains a
mathematical error.

(d) For the Earn-Out Period, Buyer shall pay to Seller, as an adjustment to the
Purchase Price, in immediately available funds to a United States bank account designated
to Buyer by Seller in writing at least two (2) Business Days prior to the date of such
payment, the product (the “Earn-Out Amount”) of (i) the excess, if a positive
number, of (A) EBITDA for the Earn-Out Period over (B) the Earn-Out Threshold (as
hereinafter defined), multiplied by (ii) 5; provided, however, that in no
event shall the Earn-Out Amount exceed $10,000,000. The “Earn-Out Threshold”
shall initially mean $5,000,000, subject to adjustment as provided below.

(e) If, during the Earn-Out Period, Buyer sells, leases, transfers or otherwise
disposes of assets material to the Business, or buys, leases or otherwise acquires
material assets related to the Business which are subsequently operated as part of the
Business, Buyer and Seller agree to negotiate in good faith an adjustment to the Earn-Out
Threshold, which shall be adjusted to reflect the impact of such acquisition or
disposition.

(f) For purposes of this §2.7, “EBITDA” shall mean the consolidated net
income of the Business before interest income or expense, taxes, depreciation expense,
amortization expense, and non-recurring or extraordinary gains or charges and shall be
calculated based on the following principles:

(i) Sales or transfers of products and the provision of services from Buyer to
or from its Affiliates will be valued at prices charged to regular customers of
Buyer or its Affiliates, as the case may be, for similar products or services (or,
if such products or services are not sold or provided to regular customers, then
they will be valued at cost);

(ii) EBITDA shall exclude any expense related to the transactions contemplated
by this Agreement;

(iii) EBITDA shall exclude all corporate and allocated overhead charges above
$500,000, including any management or license fees charged by Buyer or its
Affiliates;

(iv) EBITDA shall exclude one-time costs and expenses incurred in connection
with the sale of the Business by Seller to Buyer, including any restructuring costs,
severance costs, or other one-time carve-out costs;

(v) EBITDA shall exclude any expense for lease or rental payments of any
property or equipment, other than property or equipment that is leased by Seller or
PEPL as of the Closing Date (or any property or equipment rented or leased to
replace such property or equipment); and

(vi) EBITDA shall exclude any income or expense directly attributable to any
significant operational change to the Business made by Buyer after the Closing,
except for the changes set forth on Schedule 2.7(f)(vi), which will include the
termination of 12 employees by Seller and termination of the Michigan Lease by
Seller. For the avoidance of doubt, capital improvements in excess of $1,000,000
with respect to a single project (excluding any capital improvements currently
planned or commenced by Seller) shall constitute a significant operational change
for purposes of this Section 2.7(f)(vi).

(g) Buyer may offset any amounts currently due from Seller to Buyer under this
Agreement against any amounts currently due to Seller under this §2.7.

2.8. The Closing. The closing of the transactions contemplated by this Agreement (the
“Closing”) shall take place at the offices of Ropes & Gray LLP in New York, New York,
commencing at 10:00 a.m. eastern time on July 31, 2006 or such other date as the Parties may
mutually determine (the “Closing Date”).

2.9. Deliveries at the Closing.

(a) At the Closing Seller shall deliver to Buyer (i) the various certificates,
instruments, and documents referred to in §7.1 below, (ii) such other instruments of sale,
transfer, conveyance and assignment as Buyer and its counsel may reasonably request, and
(iii) the Ancillary Agreements to which Seller is to be a party. At the Closing, Buyer
shall deliver the Ancillary Agreements to which Buyer is to be a party and shall deliver
the Purchase Price specified in §2.5 above.

(b) To the extent that the assignment to Buyer of any outstanding contract,
agreement, license, lease, permit or authorization pursuant to this Agreement is not
permitted without the consent of another party, this Agreement shall not be deemed to
constitute an undertaking to assign the same if such consent is not given;
provided, that Seller and Buyer shall use reasonable best efforts, both before and
after the Closing, to obtain all such consents and, at Buyer’s request, Seller shall
cooperate in any arrangement designed to provide Buyer with the benefits and obligations
of any such contract, agreement, license, lease, permit or authorization. If and when any
such consents are obtained after the Closing, Seller shall promptly assign its rights and
obligations under the related contract, agreement, license, lease, permit or authorization
to Buyer and Buyer shall, without payment of any consideration therefore, assume such
rights and obligations.

2.10. Withholdings. Buyer shall be entitled to deduct and withhold from the
consideration otherwise payable pursuant to this Agreement to Seller, such amounts as it is
required to deduct and withhold with respect to the making of such payment under the Brazilian Tax
law. To the extent that such amounts are so withheld by Buyer, such withheld amounts shall be
treated for all purposes of this Agreement as having been paid to Seller. If the Brazilian taxing
authority determines that withholding tax in excess of the amount withheld at Closing is due with
respect to the transfer of the PEPL Quotas, Seller agrees to bear the burden of such withholding
tax (including any interest and penalties thereon) (such amounts, “Brazilian Withholding
Taxes”).

3. Representations and Warranties of Seller. Seller represents and warrants to Buyer that,
except as set forth in the disclosure schedule attached to this Agreement (the “Disclosure
Schedule”):

3.1. Organization. Seller is a corporation duly organized, validly existing, and in
good standing under the laws of the State of Delaware. PEPL has been duly organized as a private
company under the laws of Brazil and is validly existing under the laws of Brazil. Seller and PEPL
have full corporate power and limited liability company power, respectively, to carry on the
Business as it is now being conducted and to own and lease the properties and assets they now own
or lease, as applicable. Seller and PEPL are each duly qualified or licensed to do business as a
foreign corporation or limited liability company and are each in good standing in each jurisdiction
in which such qualification is required for the operation of the Business, except where any failure
to be so qualified has not had, and would not reasonably be expected to have, a Material Adverse
Effect. Copies of the organizational documents of the Seller and PEPL, including the members’
register and the Articles of Organization of PEPL currently in place and subsequent amendments,
have been heretofore delivered to Buyer and they are complete and correct copies of such
instruments as in effect as of the date of this Agreement (the “Organizational Documents”).
Section 3.1 of the Disclosure Schedule sets forth a true, correct and complete list of all
jurisdictions in which Seller and PEPL are qualified to do business.

3.2. Authorization of Transaction. Seller has the power (including full corporate
power) to execute and deliver this Agreement and the other agreements contemplated hereby and to
carry out the transactions contemplated hereby. Seller and its officers and directors have taken
all corporate actions necessary to duly and validly authorize the execution and delivery of this
Agreement and the Ancillary Agreements, the consummation of the transactions contemplated hereby
and thereby, and the performance of its obligations hereunder and thereunder. This Agreement and
the Ancillary Agreements to which Seller is a party have been duly executed and delivered by Seller
and, assuming due execution and delivery by Buyer, are Enforceable against Seller in accordance
with their terms.

3.3. Noncontravention; Governmental Authorities; Consents. Except as set forth in
Section 3.3 of the Disclosure Schedule, neither the execution and the delivery of this Agreement,
nor the consummation of the transactions contemplated hereby (including the assignments and
assumptions referred to in §2 above), will (i) violate any material Legal Requirement to which PEP
Group or any of its property is subject, (ii) violate any provision of the Organizational
Documents, (iii) violate, or be in conflict with, or constitute a default (or an event which, with
notice or lapse of time or both, would constitute a default) under, or result in or give to others
any rights of termination of, or accelerate the performance required by, or cause the acceleration
of the maturity of any Debt or obligation pursuant to, any Contractual Obligations of PEP Group, or
(iv) result in the creation of a Lien on the PEPL Quotas or any of the Acquired Assets, except, in
the case of clauses (i), (iii) and (iv), as has not had and would not reasonably be expected to
have a Material Adverse Effect. Except for the filing with the Board of Trade of the State of
Parana of the Amendment to the PEPL Articles of Organization reflecting the assignment and transfer
of PEPL Quotas, no notice to, consent, approval or authorization of, or designation, declaration or
filing with, any Governmental Authority or other Person is required on the part of Seller or any of
its Affiliates with respect to the execution or delivery of this Agreement or the consummation of
the transactions contemplated hereby, except as otherwise disclosed in Section 3.3 of the
Disclosure Schedule.

3.4. Brokers’ Fees. No broker, finder, or agent has acted directly or indirectly for
Seller with respect to the transactions contemplated by this Agreement.

3.5. Ownership of PEPL Quotas. Seller is the lawful record holder and beneficial
owner of fifty thousand eight hundred eighty (50,880) PEPL Quotas, as reflected in the PEPL
Articles of Association (the “Seller Quotas”), free and clear of any Liens other than
restrictions on transfer pursuant to any applicable Brazilian Legal Requirement or any Legal
Requirement regarding the issuance, sale, or transfer of securities. The Seller Quotas and the
Stanadyne Quota constitute all of the issued and outstanding equity interests of PEPL. The PEPL
Quotas have been duly authorized, validly issued and are fully paid up, and were not issued in
violation of any preemptive rights. There are no commitments or obligations of any kind or
character for (A) the issuance of PEPL Quotas or any other equity interests of PEPL or (B) the
repurchase, redemption or other acquisition of PEPL Quotas. There are no voting trusts,
stockholder agreements, proxies or other agreements in effect with respect to the voting or
transfer of the PEPL Quotas. PEPL does not own of record or beneficially any equity interests in
any Person.

3.6. Financial Statements.

(a) Section 3.6 of the Disclosure Schedule contains true, correct and complete copies
of the following financial statements (collectively, the “Financial Statements”):
(i) the audited balance sheets of the Business as of December 31, 2005 (the “Most
Recent Fiscal Year End Balance Sheet”), December 31, 2004 and December 31, 2003 and
the related statements of income and cash flows for the fiscal years then ended
accompanied by any notes thereto and the report of Deloitte & Touche LLP therein; (ii) the
unaudited balance sheet of the Business as of May 31, 2006 (the “Interim Balance
Sheet”) and the related unaudited statement of income and cash flows for the five
months then ended (the “Interim Financials”); (iii) the unaudited balance sheets
of PEPL as of December 31, 2005, December 31, 2004 and December 31, 2003 and the related
statements of income and cash flows for the fiscal years then ended; and (iv) the
unaudited balance sheet of PEPL as of May 31, 2006 and the related unaudited statement of
income and cash flows for the five months then ended. Except as set forth in §3.6(a) of
the Disclosure Schedule, the Financial Statements present fairly in all material respects
the financial position of the Business and PEPL at the respective dates thereof, and the
results of its operations and cash flow activity for the periods referred to therein, in
accordance with the Accounting Standards consistently applied across such periods (subject
in the case of the Interim Financials to the lack of footnote disclosure and changes
resulting from normal year-end adjustments, none of which will be significant individually
or in the aggregate).

(b) There are no Liabilities of the Business that would be required to be accrued on a
balance sheet prepared in accordance with the Accounting Standards, applied on a basis
consistent with the preparation of the Most Recent Fiscal Year End Balance Sheet, other
than Liabilities (i) reflected and reserved against on the Interim Balance Sheet, or (ii)
incurred since May 31, 2006 in the Ordinary Course of Business and in accordance with the
terms of this Agreement, which Liabilities will be reflected and reserved against on the
Closing Balance Sheet.

3.7. Title to Assets. Seller has good title to, and the power to sell or transfer to
Buyer, all of the Acquired Assets of Seller, and PEPL has good title to all of the assets of PEPL,
free and clear of any Liens, except for Permitted Liens. Except for disposals in the Ordinary
Course of Business and in accordance with the terms of this Agreement, all properties, assets,
rights, preferences and agreements (real, personal and mixed, tangible and intangible) used or held
for use primarily in, or material or necessary to, the conduct of the Business as conducted on the
date hereof and on the Closing Date, are (a) included in the Acquired Assets or (b) will be made
available to Buyer pursuant to, and subject to the terms of, the Transitional Services Agreement
and are described on Schedule 2.2(h). Each such tangible asset included in the Acquired
Assets (i) has been maintained in accordance with normal industry practice and (ii) is in good
operating condition and repair (subject to normal wear and tear). No such tangible asset included
in the Acquired Assets is in need of repair or replacement other than as part of routine
maintenance in the Ordinary Course of Business. Following the consummation of the transactions
contemplated by this Agreement, PEPL will continue to own, pursuant to good title, or lease, under
valid and subsisting leases, or otherwise retain, its interest in the Acquired Assets owned by PEPL
without incurring any penalty or other adverse consequence, including, without limitation, any
increase in rentals, royalties, or licenses or other fees imposed as a result of, or arising from,
the consummation of the transactions contemplated by this Agreement.

3.8. Legal and Other Compliance.

(a) Seller and PEPL are in compliance with all applicable Legal Requirements relating
to the conduct of the Business, no Action has been filed or commenced against Seller or
PEPL alleging any failure so to comply, and neither Seller nor PEPL has received a notice
of any investigation or review by any Governmental Authority with respect to the Business
or the Acquired Assets, except as would not, in the aggregate, reasonably be expected to
have a Material Adverse Effect. Seller and PEPL hold all material permits, registrations,
licenses, orders and approvals of all Governmental Authorities necessary to conduct the
Business as it is presently conducted, each of which is in full force and effect (the
“Seller Permits”), except where the failure to be in full force and effect would
not reasonably be expected to have a Material Adverse Effect. Seller and PEPL are in
compliance in all respects with the terms of Seller Permits, except where the failure to be
in compliance would not reasonably be expected to have a Material Adverse Effect. There
are no Actions pending nor, to the Knowledge of Seller, threatened that seek the
revocation, cancellation, suspension or adverse modification of any Seller Permit. Section
3.8 of the Disclosure Schedule sets forth a true, correct and complete list of all of the
Seller Permits.

(b) Neither Seller, PEPL, nor any of their Affiliates, nor any director, officer,
agent or employee of any of them, has (i) used any funds for unlawful contributions, gifts,
entertainment, or other unlawful expenses related to political activity, (ii) made any
unlawful payment or offered anything of value to foreign or domestic government officials,
employees, political parties, or campaigns, (iii) made any other unlawful payment, or (iv)
violated any applicable export control, money laundering, or anti-terrorism law or
regulation, nor have any of them otherwise taken any action that would cause the Seller,
PEPL, or any of their Affiliates to be in violation of the Foreign Corrupt Practices Act of
1977, as amended, or any applicable law of similar effect. Any inaccuracies in the
representations and warranties contained in this § 3.8(b) of which Seller does not have
Knowledge shall constitute a breach hereof by Seller only if such inaccuracies, in the
aggregate, have had, or would reasonably be expected to have, a Material Adverse Effect.

3.9. Taxes. Except as otherwise disclosed in Section 3.9 of the Disclosure Schedule:

(a) PEPL has timely filed (or caused to be timely filed) with the appropriate Tax
authorities all Tax Returns required to be filed with respect to PEPL, its assets,
operations or income. Each of such Tax Returns is true, complete and correct in all
material respects (provided that this representation shall not give Seller liability for
Taxes attributable to any Post-Closing Tax Period). Seller and Stanadyne each has timely
filed (or caused to be timely filed) with the appropriate Tax authorities all material Tax
Returns required to be filed with respect to the Acquired Assets and the income and
operations of Business.

(b) PEPL has paid or will pay prior to Closing in full all Taxes that have accrued or
are due and payable, in each case in respect of (i) any taxable periods that end on or
before the Closing Date and (ii) any taxable period that begins before the Closing Date
and ends thereafter, to the extent that such Taxes are attributable under the terms of
§6.4(d) to the portion of such period ending on and including the Closing Date (each
taxable period or portion thereof ending on or before the Closing Date, a “Pre-Closing
Tax Period”), other than Taxes for which a reserve or liability has been or will be
established on the Final Closing Balance Sheet and which reserve or liability is reflected
in the calculation of Closing Working Capital (other than any reserve for deferred Taxes
established to reflect timing differences between book and Tax income). Seller and
Stanadyne each has paid or will pay in full or discharged or will discharge all Taxes the
nonpayment of which would result in a Lien or other encumbrance on the Acquired Assets in
the hands of the Buyer, excepting in each case such Taxes as will not be due until after
the Closing Date.

(c) There is no audit or other matter in controversy with respect to any Taxes due
and owing by PEPL, and there is no Tax deficiency or claim assessed or, to the Knowledge
of Seller or Stanadyne, proposed or threatened in writing against PEPL, other than in
respect of any such audits, controversies, deficiencies, assessments, or proposed
assessments that are being contested in good faith, for which adequate reserves have been
or will be established on the Final Closing Balance Sheet, and which are disclosed on
Schedule 3.9(c).

(d) PEPL has withheld all Taxes required to have been withheld and paid in connection
with amounts paid or owing to any employee, independent contractor, creditor, stockholder,
or other third party, and such withheld Taxes have either been duly paid to the proper
Governmental Authority or set aside in accounts for such purpose.

(e) None of Seller, Stanadyne, or PEPL has waived any statutory period of limitations
for the assessment of any Taxes relating to PEPL, the Acquired Assets or the income or
operations of the Business, or agreed to any extension of time with respect to a Tax
assessment or deficiency relating to PEPL, the Acquired Assets or the income or operations
of the Business, other than in the case of any such waivers or extensions in respect of an
assessment or deficiency of Tax the liability of which has been satisfied or settled.
PEPL does not have any liability for the Taxes of any other person or dissolved entity
under sections 128 until 137 of the Brazilian National Tax Code (Law no 5172/66
or any similar provision of federal, state, federal district, municipal, or foreign law),
as a transferee, successor, or by any contract primarily related to Taxes or otherwise.

(f) No claim has been made in writing by an authority in a jurisdiction where PEPL
does not file Tax Returns that PEPL is or may be subject to taxation by that jurisdiction.

(g) PEPL shall not be required to include in a taxable period or portion thereof
ending on or after the Closing Date (a “Post-Closing Tax Period”) taxable income
attributable to income of PEPL that accrued in a Pre-Closing Tax Period but was not
recognized for tax purposes in any Pre-Closing Tax Period for any reason, including any
provision of any foreign, federal, state, federal district or local Tax law having similar
effect, such as those mentioned in sections 407, 409 and 421 of the Brazilian federal
income tax regulations (Decree 3000/99).

(h) PEPL does not have any obligation under (i) any Tax allocation or Tax sharing
agreement with Seller, Stanadyne or any other PEPL Affiliate or (ii) any Tax allocation or
sharing agreement primarily related to Taxes.

(i) There are no Liens or other encumbrances related to Taxes on the assets of PEPL
or the Acquired Assets, other than for current Taxes that are not yet due and payable.

(j) PEPL is not a “surrogate foreign corporation” within the meaning of Section
7874(a)(2)(B) of the Code and is not treated as a U.S. corporation under Section 7874(b)
of the Code.

(k) PEPL (i) does not have an investment in U.S. property within the meaning of
Section 956 of the Code or (ii) is not engaged in a United States trade or business for
U.S. federal income Tax purposes. Except to the extent the liability for Taxes relating
to such amount is included in the Final Closing Balance Sheet and taken into account in
the calculation of Closing Working Capital, Buyer would not be required to include any
amount in gross income with respect to PEPL pursuant to Section 951 of the Code if the
taxable year of PEPL were deemed to end on the day after the Closing Date, but not taking
into account any activities or income of PEPL on such day.

(l) PEPL is treated as an association for United States income tax purposes under
Treasury Regulation Section 301.7701-3(b)(2). PEPL has not filed an IRS Form 8832 to
change its default classification.

3.10. Property, Plant and Equipment.

(a) Section 3.10(a) of the Disclosure Schedule sets forth a true, correct and
complete list of the addresses or locations of all real property and interests in real
property used primarily in, or which are material or necessary to, the conduct of the
Business as presently conducted and owned by Seller or PEPL (collectively, the “Owned
Real Properties”). Seller and PEPL have, and at Closing Seller will transfer to
Buyer, good and marketable title to all Owned Real Properties, free and clear of all Liens
other than Permitted Liens.

(b) Section 3.10(b) of the Disclosure Schedule sets forth a true, correct and
complete list of all leases, subleases and other agreements pursuant to which Seller or
PEPL uses or occupies or has the right to use or occupy any real property (the “Real
Property Leases,” and the real properties specified in such Real Property Leases,
together with the Owned Real Properties, being referred to herein individually as a
“Seller Property” and collectively as the “Seller Properties”), and Seller
has provided to Buyer true, correct and complete copies of each such Real Property Lease,
including all amendments and supplements thereto. Seller and PEPL have, and at Closing
Seller will transfer to Buyer (with the exception of the Michigan Lease), a valid
leasehold interest in all of the real properties subject to the Real Property Leases, free
and clear of all Liens other than Permitted Liens. Seller and PEPL enjoy peaceful and
undisturbed possession of all of the Seller Properties. The Seller Properties constitute
all real property used primarily in, or material or necessary to, the conduct of the
Business as presently conducted.

(c) Each of Seller and PEPL has complied in all material respects with the terms of
the Real Property Leases under which it is in occupancy and such Real Property Leases are
in full force and effect. No event has occurred which (with notice, lapse of time or
both) would constitute a material breach or default under the Real Property Leases by
Seller or PEPL or, to the Knowledge of Seller, by any other party thereto. None of
Seller, PEPL and each of their Affiliates has received any written notice of cancellation
or termination of, or any written expression or indication of an intention or desire to
cancel or terminate, any of the Real Property Leases, nor will the sale, assignment or
transfer of the PEPL Quotas constitute a cause for such termination.

(d) There are no leases, subleases, licenses, occupancy agreements, options, rights,
concessions or other agreements or arrangements, written or oral, granting to any other
Person the right to purchase, use or occupy any of the Seller Properties.

(e) There are no pending or, to the Knowledge of Seller, threatened condemnation
proceedings or other Actions relating to any Seller Property. All Seller Properties have
received all required approvals of Governmental Authorities (including without limitation
permits and a certificate of occupancy or other similar certificate permitting lawful
occupancy of the Seller Properties) required in connection with the operation thereof and
have been operated and maintained in all material respects in accordance with applicable
Legal Requirements. Seller has not received notice of any special assessment relating to
any Seller Property and there is no pending or, to the Knowledge of Seller, threatened
special assessment.

3.11. Intellectual Property.

(a) Seller or PEPL owns or has obtained license rights to the Intellectual Property and
Technology necessary for or used in the operation of the Business as presently conducted,
and the title or license rights to such Intellectual Property and Technology will be
transferred to Buyer at Closing free and clear of all Liens other than Permitted Liens.

(b) Neither Seller nor PEPL has infringed or misappropriated any Intellectual Property
or Technology of third parties in connection with the conduct of the Business, and there is
no pending or, to the Knowledge of Seller, threatened Action with respect thereto. To the
Knowledge of Seller, no third party has infringed or misappropriated any Intellectual
Property or Technology of Seller or PEPL relating to the conduct of the Business, and there
is no pending or threatened Action by Seller with respect thereto.

(c) Section 3.11(c) of the Disclosure Schedule identifies each patent, registered
Trademark, registered copyright and Internet domain name that has been issued to Seller,
PEPL or Stanadyne with respect to the Acquired Intellectual Property, each pending patent,
Trademark or copyright application that has been made with respect to the Acquired
Intellectual Property, a list of all jurisdictions in which such Acquired Intellectual
Property is registered or applied for and all registration and application numbers, and each
Contractual Obligation that Seller or PEPL has entered into with any third party (whether as
licensee or licensor) with respect to any of the Acquired Intellectual Property (together
with any exceptions). Seller has made available to Buyer correct and complete copies of all
such patents, Trademarks, copyrights, applications, and Contractual Obligations (as amended
to date). Section 3.11(c) of the Disclosure Schedule also identifies each trade name or
unregistered Trademark included in the Acquired Intellectual Property. With respect to each
item of Acquired Intellectual Property:

(i) Seller or PEPL is the sole owner of and possesses all right, title and
interest in and to, or has a transferable license to the item, free and clear of any
Lien, other than Permitted Liens;

(ii) the item is not subject to any outstanding injunction, judgment, order,
decree, ruling, or charge;

(iii) with respect to patents, registered Trademarks and registered copyrights,
the item has been duly registered and maintained, is subsisting and has not expired
or been cancelled or abandoned;

(iv) no Action is pending or, to the Knowledge of Seller, is threatened, which
challenges the legality, validity, enforceability, use, or ownership of the item;
and

(v) to the Knowledge of Seller, no other Person has the right to use the item,
except pursuant to a Contractual Obligation identified on §3.11(c) of the Disclosure
Schedule.

(d) Except as expressly set forth in this §3.11(c), neither Seller nor PEPL makes any
representation or warranty with respect to the validity, enforceability, prosecution or
maintenance of any item of Intellectual Property.

3.12. Environmental Matters.

(a) Except as disclosed in Section 3.12 of the Disclosure Schedule or except as would
not be material, (i) Seller, PEPL and their subsidiaries are and at all times have been in
compliance with, and have no liability under, any and all applicable Environmental Laws,
and (ii) Seller, PEPL and their subsidiaries are in compliance with all of their
Environmental Permits, and (iii) and all instances of past noncompliance have been cured,
settled, and resolved in all material respects.

(b) Except as disclosed in Section 3.12 of the Disclosure Schedule or except as would
not be material, all Environmental Permits have been obtained as of the date hereof by or
on behalf of Seller, PEPL and their subsidiaries, as applicable, for the lawful operation
of Acquired Assets and Seller Properties, and remain in full force and effect, and there
are no pending judicial or regulatory proceedings by any Governmental Authority that could
reasonably be expected to result in the termination, revocation, or adverse modification
of any such Environmental Permit. A list of all Environmental Permits required for the
lawful operation of the Acquired Assets, Seller Properties, PEPL and the Business is set
forth on Section 3.12 of the Disclosure Schedule.

(c) Except as disclosed in Section 3.12 of the Disclosure Schedule or settled or
resolved, none of Seller, PEPL and each of their subsidiaries has received any written
request for information, or been notified in writing that it is a potentially responsible
party, under the Comprehensive Environmental Response, Compensation and Liability Act of
1980, as amended (“CERCLA”), or any similar state, local or foreign law with
respect to any of the Acquired Assets, Seller Properties or any other location used in
connection with the Business.

(d) Except as disclosed in Section 3.12 of the Disclosure Schedule or settled or
resolved in all material respects, none of Seller, PEPL and each of their subsidiaries has
received any notice of any violation or alleged violation of any Environmental Law.

(e) Except as disclosed in Section 3.12 of the Disclosure Schedule, (i) in connection
with the Acquired Assets, Seller Properties or the Business, there are no outstanding
writs, injunctions, decrees, orders or judgments pursuant to or arising under any
Environmental Laws to which Seller, PEPL or any of their subsidiaries is a party, and (ii)
there are no Environmental Claims to which Seller, PEPL or any of their Subsidiaries is a
party that are pending or, to the Knowledge of Seller, threatened, relating to the
compliance of Seller, PEPL or any of their Subsidiaries with, or the liability of Seller,
PEPL or any of their subsidiaries under, any Environmental Laws in respect of the Acquired
Assets, Seller Properties or the Business.

(f) Except as disclosed in Section 3.12 of the Disclosure Schedule, none of Acquired
Assets, Seller Properties nor any property or location to which Substances may have been
disposed of by the Seller or PEPL (or their subsidiaries) in connection with operation of
the Acquired Assets and Business, is listed or, to the Knowledge of Seller, proposed for
listing on the “National Priorities List” under CERCLA, or on the Comprehensive
Environmental Response, Compensation and Liability Information System maintained by the
United States Environmental Protection Agency, as updated through the Closing Date, or any
similar state or foreign list of sites requiring investigation or cleanup.

(g) Except as disclosed in Section 3.12 of the Disclosure Schedule or in any of the
environmental reports or documents listed in Section 3.12 of the Disclosure Schedule,
there is no Substance that poses or could reasonably be expected to pose any material risk
to safety, health or the Environment on, at or under any of the Acquired Assets or Seller
Properties, and there has heretofore been no Release of any such Substance on, at or under
such Acquired Assets or Seller Properties, in either case in an amount and of a nature
which could reasonably be expected to result in material liability to the Seller, PEPL or
any of their subsidiaries.

(h) Except as disclosed in Section 3.12 of the Disclosure Schedule, none of Seller,
PEPL and each of their subsidiaries is a party to any contract in respect of the Business,
Acquired Assets or Seller Properties pursuant to which it is obligated to indemnify any
other person with respect to, or be responsible for any liability pursuant to, or
violation of, any Environmental Law.

(i) Seller and PEPL have made available to, or provided the Buyer with, true and
correct copies of all Phase I and Phase II reports and any other material environmental
studies in the possession of Seller, PEPL and any of their subsidiaries relating to any
Acquired Asset or Seller Properties, or any Handling of Substances.

3.13. Contracts. Section 3.13 of the Disclosure Schedule lists all of the following
Contractual Obligations of PEP Group that relate primarily to the conduct of the Business or the
Acquired Assets (each a “Material Contract” and collectively, the “Material
Contracts”): (i) any Contractual Obligation which involves annual consideration in excess of
$100,000; (ii) any employee, consulting, or severance agreement; (iii) any credit agreement, loan
agreement, indenture, note, mortgage, security agreement, loan commitment, evidence of Debt, or
other contract relating to the borrowing of funds; (iv) any Contractual Obligation required to be
listed in §3.11(c) of the Disclosure Schedule; (v) any agreement with any customer or supplier
listed in §3.19 of the Disclosure Schedule; (vi) any agreement with any Governmental Authority;
(vii) any collective bargaining agreement; (viii) any agreement relating to the acquisition or
disposition of any business (including without limitation, any transitional services agreement);
(ix) any agreement that restricts or prohibits Seller or PEPL from engaging in any line of business
or from competing with any person or entity; (x) any agreement containing “change in control” or
similar provisions relating to a change in control of Seller or PEPL; (xi) any agreement pursuant
to which Seller or PEPL is obligated to indemnify any person or entity; (xii) any contract that
will result in the payment by, or the creation or acceleration of any Liability to pay on behalf of
Buyer, Seller or PEPL any severance, termination, “golden parachute,” or other similar payments to
any present or former personnel following termination of employment or otherwise as a result of the
consummation of the transactions contemplated by this Agreement; (xiii) any labor or union
contract, or agreement to comply with the terms set by any national union; (xiv) any other
Contractual Obligation material to Seller, PEPL, the Business, or the Acquired Assets; and (xv) any
other Contractual Obligation not entered into in the Ordinary Course of Business. Seller has made
available to Buyer a correct and complete copy of each Material Contract, including all amendments
and supplements thereto. Each of the Material Contracts listed is in full force and effect and
Enforceable. None of Seller, PEPL and each of their Affiliates has received any written notice of
cancellation or termination of, or any expression or indication of an intention or desire to cancel
or terminate, any of the Material Contracts. There exists no event of default, condition or act on
the part of Seller or to the Knowledge of Seller, on the part of the other parties to any Material
Contract, which constitutes or would constitute (with notice or lapse of time or both) a material
breach of or material default under any of the Material Contracts.

3.14. Litigation. Except as set forth in §3.14 of the Disclosure Schedule, there are
no Actions pending or, to the Knowledge of Seller, threatened, against Seller, PEPL or any of their
Affiliates that relate to or would affect the Business or any of the Acquired Assets, or that
question the validity of this Agreement or of any action taken or to be taken pursuant to or in
connection with the provisions of this Agreement. There are no judgments, orders, decrees,
citations, fines or penalties under any Legal Requirement to which Seller, PEPL or any of their
Affiliates are subject affecting the Business, the Acquired Assets, the PEPL Quotas or the Assumed
Liabilities.

3.15. Employee Benefit Plans. Section 3.15 of the Disclosure Schedule contains a true
and complete list of each material Employee Plan. For purposes of this Agreement, “Employee Plan”
shall mean each employee benefit plan (including each employee benefit plan within the meaning of
Section 3(3) of ERISA) and each other deferred compensation and each bonus or other incentive
compensation, severance or termination pay, stock purchase, stock option and other equity
compensation plan, program, agreement or arrangement in which employees of the Business participate
that is sponsored, maintained or contributed to or required to be contributed to by Seller or an
Affiliate for employees of the Business or with respect to which PEPL may have any Liability or
obligation (the “Employee Plans”). The Seller will use commercially reasonable efforts to
make available a copy of each Employee Plan to Buyer. Except as otherwise provided in §3.15 of the
Disclosure Schedule:

(a) each Employee Plan has been operated and administered in all material respects in
accordance with its terms and applicable Legal Requirements, including but not limited to
the Employee Retirement Income Security Act of 1974, as amended (“ERISA”) and the
Code;

(b) each Employee Plan that is intended to be “qualified” within the meaning of
Section 401(a) of the Code has received a favorable determination letter from the IRS as
to the qualified status of the Plan and, to the Knowledge of Seller, nothing has occurred
that would reasonably be expected to cause the revocation of such letter;

(c) none of the Employee Plans is subject to Title IV of ERISA or is a “multiemployer
plan” within the meaning of Section 3(37) of ERISA;

(d) none of the Employee Plans provides for medical or death benefits beyond
termination of service or retirement, other than pursuant to the Consolidated Omnibus
Budget Reconciliation Act of 1985, as amended (“COBRA”), or any similar state or
local law with respect to which Buyer has or will have any liability;

(e) no amount that could be received (whether in cash or property or the vesting of
property) as a result of any transaction contemplated hereby by any employee, officer or
director of Seller or an Affiliate of Seller who is a “disqualified individual” (as such
term is defined in proposed Treasury Regulation Section 1.280G-1) under any employment,
severance or termination agreement, other compensation arrangement or Employee Plan could
be characterized as an “excess parachute payment” (as defined in Section 280G(b)(1) of the
Code);

(f) neither the Seller nor any trade or business (whether or not incorporated) that
is treated as a single employer with the Seller under Section 414(b) or Section 414(c) of
the Code has incurred or is reasonably expected to incur any liability under Title IV or
Section 302 of ERISA for which Buyer could reasonably be expected to be liable;

(g) neither the execution and delivery of this Agreement or any of the Ancillary
Agreements by any Seller or Stanadyne, nor the consummation of the transactions
contemplated hereby or thereby (either alone or contingent upon the occurrence of any
additional or subsequent events) will result in forgiveness of indebtedness or the
acceleration or creation of any rights of any person to compensation or benefits under any
Employee Plan (including the acceleration of the accrual or vesting of any benefits under
any Employee Plan or the acceleration or creation of any rights under any severance,
parachute or change in control agreement or the right to receive any transaction bonus or
other similar payment); and

(h) all Employee Plans intended to cover employees located in a jurisdiction other
than the United States (“Foreign Plans”) are, and have been, established and
maintained in all material respects in accordance with the terms of such Foreign Plans
(excluding any arrangement mandated by statute and which is not established or maintained
by Company) including the terms of the material documents that support such Foreign Plans,
any applicable collective agreement and all applicable laws. To the Knowledge of Seller,
no event has occurred respecting any Foreign Plan which would result in the revocation of
the registration of such Foreign Plan or entitle any person (without consent of Seller) to
wind up or terminate any Foreign Plan, in whole or in part, or which could otherwise
reasonably be expected to adversely affect the tax status of any such Foreign Plan. None
of the Foreign Plans provides for benefit increases or the acceleration of, or an increase
in, funding obligations that are contingent upon, or will be triggered by the completion
of the transactions contemplated herein. With respect to each Foreign Plan, the fair
market value of the assets of each funded Foreign Plan, the liability of each insurer for
any Foreign Plan funded through insurance or the book reserve established for any Foreign
Plan, together with any accrued contributions, is sufficient, in all material respects, to
procure or provide for the accrued benefit obligations, as of the date of this Agreement,
with respect to all current and former participants in such plan , and no transaction
contemplated by this Agreement shall cause such assets, reserve or insurance obligations
to be less than such benefit obligations. None of the Foreign Plans provides benefits
beyond retirement or other termination of service to employees or former employees or to
the beneficiaries or dependents of such employees. There is no proceeding, action, suit
or claim (other than claims for payments of benefits in the ordinary course) pending or
threatened involving any Foreign Plan or its assets that is reasonably expected to result
in any material liability.

3.16. Labor Matters.

(a) Except as set forth in § 3.16 of the Disclosure Schedule, neither Seller nor PEPL
is a party or subject to any labor agreement with respect to its employees with any labor
organization, union, group or association and there are no employee unions (nor any other
similar labor or employee organizations) under local statues, custom or practice. In the
past five years, neither Seller nor PEPL has experienced any attempt by organized labor or
its representatives to make Seller or PEPL conform to demands of organized labor relating
to its employees or to enter into a binding agreement with organized labor that would
cover the employees of Seller or PEPL. There is no labor strike or labor disturbance
pending or, to the knowledge of Seller, threatened against Seller or PEPL nor is any
grievance currently being asserted, and in the past five years neither Seller nor PEPL has
experienced a work stoppage or other labor difficulty, and is not and has not engaged in
any unfair labor practice or been subject to any unfair labor practice complaint or
related or successor employer application and no such complaints or applications are, to
Seller’s knowledge, threatened. Each of Seller and PEPL is in compliance with all
applicable foreign, federal, state and local laws, rules and regulations respecting
employment, employment practices, terms and conditions of employment, worker
classification and wages and hours, in each case, with respect to its current and former
employees, directors, officers, consultants and independent contractors, except where the
failure to be so in compliance would not reasonably be expected to have a Material Adverse
Effect. Except as set forth in Section 3.16 of the Disclosure Schedule, neither Seller
nor PEPL has incurred any liability for the misclassification of employees as consultants
or independent contractors or, since January 1, 2005, any material liability arising from
non-compliance with Brazilian labor health and safety regulations.

(b) Except as set forth in §3.16(b) of the Disclosure Schedule, during the last five
years there has been no “mass layoff” or “plant closing” as defined by WARN in respect of
Seller. Neither Seller nor PEPL been affected by any transactions or engaged in layoffs
or employment terminations sufficient in number to trigger application of any state, local
or foreign Legal Requirements or regulation which is similar to WARN.

3.17. Product Warranties. To the Knowledge of Seller, each product manufactured,
sold, leased, or delivered by Seller or PEPL in the conduct of the Business has been in conformity
in all material respects with all applicable Legal Requirements and Contractual Obligations and all
express and implied warranties. No product manufactured, sold, leased, or delivered by Seller in
the conduct of the Business is subject to any guaranty, warranty, or other indemnity beyond the
applicable standard terms and conditions of sale or lease.

3.18. Affiliated Transactions. Except as set forth in §3.18 of the Disclosure
Schedule, no Affiliate of Seller or any of Seller’s or any of its Affiliates’ respective officers,
directors, stockholders, members, partners or Affiliates has been a party in any business
arrangement or relationship with Seller or PEPL during the past two (2) years or which was not on
arm’s-length terms.

3.19. Customers, Suppliers. Section 3.19 of the Disclosure Schedule sets forth a
complete and accurate list of (i) the ten (10) largest customers (by dollar volume) of the Business
during the most recent fiscal year, indicating any existing Contractual Obligation with each such
customer and (ii) the ten (10) largest suppliers of materials or services to the Business,
indicating any Contractual Obligation for continued supply from such Person. To the Knowledge of
Seller, since December 31, 2005, there has been no (i) reduction, or indication of an intention to
reduce, the level of orders placed by any customer listed in Section 3.19 of the Disclosure
Schedule with the Business that is reasonably likely to result in a 15% or greater reduction in
sales to such customer over the twelve-month period following Closing compared to sales during the
twelve-month period just prior to Closing, (ii) increase in, or indication of an intention to
increase, the prices charged by any supplier listed in Section 3.19 of the Disclosure Schedule for
the provision of materials or services to the Business by 15% or more, or (iii) indication that any
customer or supplier listed in Section 3.19 of the Disclosure Schedule wishes or intends to cease
doing business with the Business. As of the date of this Agreement, to the Knowledge of the Seller
there is no reason to believe that there will be any change in the relationships of the Business
with the customers and suppliers listed on §3.19 of the Disclosure Schedule as a result of the
transactions contemplated by this Agreement.

3.20. Absence of Certain Changes. Since the date of the Most Recent Fiscal Year End
Balance Sheet, and except as set forth in §3.20 of the Disclosure Schedule, the Business has been
conducted in the Ordinary Course of Business. Without limiting the generality of the foregoing,
except as set forth in §3.20 of the Disclosure Schedule, since the date of the Most Recent Fiscal
Year End Balance Sheet, there has not been:

(a) any Material Adverse Effect;

(b) any damage, destruction or loss to any of the assets of Seller used primarily in
the conduct of the Business that, individually or in the aggregate, has had or is
reasonably likely to have a Material Adverse Effect;

(c) any sale, assignment, transfer, lease or other disposition or agreement to sell,
assign, transfer, lease or otherwise dispose of any of the assets of Seller used primarily
in the conduct of the Business, other than in the Ordinary Course of Business consistent
with past practices;

(d) a cancellation, termination or material amendment of any Material Contract, Real
Property Lease, or Seller Permit;

(e) any material change in any method of accounting or accounting practice used by
Seller or PEPL with respect to the Business;

(f) (A) any employment, deferred compensation, severance or similar agreement entered
into or amended, other than in the Ordinary Course of Business, (B) other than individual
(as opposed to across-the-board) increases in the Ordinary Course of Business for
employees other than senior management of the Business, any increase in the compensation
payable or to become payable by Seller or PEPL to any employee, officer, director, or
consultant, (C) other than individual (as opposed to across-the-board) increases in the
Ordinary Course of Business for employees other than senior management of the Business,
any increase in the coverage or benefits available under any vacation pay, company awards,
salary continuation or disability, sick leave, deferred compensation, bonus or other
incentive compensation, insurance, pension or other Plan, payment or arrangement made to,
for or with any employee, officer, director, or consultant, (D) severance pay arrangements
made to, for or with any employee, (E) any modification of any Employee Plan, arrangement,
or practice described in the Disclosure Schedule, or (F) any change in employee relations
which has, or is reasonably likely to have, a Material Adverse Effect;

(g) any capital expenditure by the Business, other than capital expenditures
involving payments that do not, individually or in the aggregate, exceed $25,000;

(h) a revaluation of any of the Acquired Assets, including without limitation,
writing off notes or accounts receivable or revaluing Inventory, other than in the
Ordinary Course of Business;

(i) any material Tax election or any agreement in respect of Taxes relating to the
Business or PEPL, including the settlement of any material Tax controversy, adoption or
change of any material accounting method in respect of Taxes, consent to any extension or
waiver of the limitation period applicable to any claim or assessment in respect of Taxes;
or

(j) any agreement to take any actions specified in this §3.20 except for this
Agreement and the agreements contemplated hereby.

3.21. Insurance. Section 3.21 of the Disclosure Schedule lists all insurance policies
covering the Business and the Acquired Assets (including policies providing property, casualty,
liability and workers’ compensation coverage). All of such policies are of the type and in the
amounts customarily carried by Persons conducting businesses similar to the Business. All premiums
due and payable in respect of such policies have been paid in full, and no default or other
circumstance exists that would create the substantial likelihood of the cancellation or non-renewal
of any such policy prior to the Closing Date.

3.22. Receivables. All accounts, notes and other receivables and amounts owing to the
Business (i) represent arm’s-length sales in the Ordinary Course of Business, (ii) constitute valid
claims of the Business, free and clear of all Liens other than Permitted Liens, and (iii) are not
and will not be subject to any valid claims, set-off or other defense or counterclaims, other than
returns in the Ordinary Course of Business.

3.23. Inventory. All Inventory (whether or not allocated to contracts in process),
including Inventory shown on the Interim Balance Sheet or acquired thereafter, was acquired or
manufactured in the Ordinary Course of Business, and is generally of a quality and quantity usable
and saleable consistent in all material respects with past practice in the Ordinary Course of
Business.

3.24. Disclaimer of other Representations and Warranties. Except as expressly set
forth in this §3 and the following §4, Seller and Stanadyne make no representation or warranty,
express or implied, at law or in equity, in respect of any of their or PEPL’s assets (including,
without limitation, the Acquired Assets and the PEPL Quotas), liabilities or operations (including,
without limitation, the Business), including, without limitation, with respect to merchantability
or fitness for any particular purpose, and any such other representations or warranties are hereby
expressly disclaimed.

4. Representations and Warranties of Stanadyne. Stanadyne represents and warrants to Buyer
that, except as set forth in the Disclosure Schedule:

4.1. Organization. Stanadyne is a corporation duly organized, validly existing, and
in good standing under the laws of the State of Delaware. Stanadyne has full corporate power and
authority to carry on its business as it is now being conducted and to own and lease the properties
and assets it now owns or leases.

4.2. Authorization of Transaction. Stanadyne has the power and authority (including
full corporate power and authority) to execute and deliver this Agreement and the other agreements
contemplated hereby and to carry out the transactions contemplated hereby. Stanadyne and its
officers and directors have taken all actions necessary to duly and validly authorize the execution
and delivery of this Agreement and the Ancillary Agreements, the consummation of the transactions
contemplated hereby and thereby, and the performance of its obligations hereunder and thereunder.
This Agreement and the Ancillary Agreements to which Stanadyne is a party have been duly executed
and delivered by Stanadyne and, assuming due execution and delivery by Buyer, are Enforceable
against Stanadyne.

4.3. Noncontravention. Except as set forth in §4.3 of the Disclosure Schedule,
neither the execution and the delivery of this Agreement, nor the consummation of the transactions
contemplated hereby (including the assignments and assumptions referred to in §2 above), will (i)
violate any material Legal Requirement to which Stanadyne or any of its property is subject, (ii)
violate any provision of the organizational documents of Stanadyne or (iii) violate, or be in
conflict with, or constitute a default (or an event which, with notice or lapse of time or both,
would constitute a default) under, or result in or give to others any rights of termination of, or
accelerate the performance required by, or cause the acceleration of the maturity of any Debt or
obligation pursuant to, any Contractual Obligations of Stanadyne, or (iv) result in the creation of
a Lien on the PEPL Quotas or any of the Acquired Assets, except, in the case of clauses (i), (iii)
and (iv), as has not had and would not reasonably be expected to have a Material Adverse Effect.

4.4. Brokers’ Fees. No broker, finder, or agent has acted directly or indirectly for
Stanadyne with respect to the transactions contemplated by this Agreement.

4.5. Ownership of PEPL Quotas. Stanadyne is the lawful record holder and beneficial
owner of one (1) PEPL Quota, as reflected in the PEPL Articles of Organization (the “Stanadyne
Quota”), free and clear of any Liens other than restrictions on transfer pursuant to applicable
Brazilian laws. The Seller Quotas and the Stanadyne Quota constitute all of the issued and
outstanding equity interests of PEPL. The PEPL Quotas have been duly authorized, validly issued
and are fully paid up, and were not issued in violation of any preemptive rights. There are no
commitments or obligations of any kind or character for (A) the issuance of PEPL Quotas or any
other equity interests of PEPL or (B) the repurchase, redemption or other acquisition of PEPL
Quotas. There are no voting trusts, stockholder agreements, proxies or other agreements in effect
with respect to the voting or transfer of the PEPL Quotas. PEPL does not of record or beneficially
own any equity interests in any Person.

5. Representations and Warranties of Buyer. Buyer represents and warrants to Seller that:

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

5.2. Authority for Agreement. Buyer has the power and authority (including full
corporate power and authority) to execute and deliver this Agreement and has taken all actions
necessary to duly and validly authorize the consummation of the transactions contemplated herein
and the performance of its obligations hereunder. This Agreement and the Ancillary Agreements to
which Buyer is a party have been duly executed and delivered by Buyer and, assuming due execution
and delivery by Seller and Stanadyne, are Enforceable against Buyer.

5.3. Noncontravention. Neither the execution and the delivery of this Agreement, nor
the consummation of the transactions contemplated hereby (including the assignments and assumptions
referred to in §2 above), will violate (i) any Legal Requirement to which Buyer is subject or (ii)
any provision of its certificate of incorporation or by-laws, except, in the case of clause (i), as
would not have a material adverse effect on the ability of Buyer to consummate the transactions
contemplated hereby.

5.4. Financing. Buyer shall have available to it on the Closing Date adequate cash on
hand to pay the Purchase Price.

5.5. Broker’s Fees. No broker, finder, or agent has acted directly or indirectly for
Buyer with respect to the transactions contemplated by this Agreement.

6. Covenants. Buyer, Seller, and Stanadyne agree as follows:

6.1. General. Each of Buyer, Seller and Stanadyne shall use its commercially
reasonable efforts to take all actions and to do all things necessary, proper, or advisable in
order to consummate and make effective the transactions contemplated by this Agreement (including
(i) satisfaction, but not waiver, of the closing conditions set forth in §7 below, (ii) obtaining
of all necessary actions or non-actions, waivers, consents and approvals from applicable
Governmental Authorities and the making of all other necessary registrations and filings (including
any filings required to be made and approvals required to be obtained pursuant to Brazilian
antitrust Legal Requirements with respect to the transactions contemplated hereby), and (iii)
transferring or reissuing to Buyer or Buyer’s designee all of the Environmental Permits listed on
Schedule 3.12.

6.2. Notices and Consents. Prior to the Closing, each of Buyer and Seller shall give
any notices to third parties required by it, and shall use its commercially reasonable efforts to
obtain any third party consents required to be obtained by it, and shall execute and deliver any
additional instruments that are necessary or desirable to transfer the Acquired Assets and the PEPL
Quotas to Buyer. Seller and Stanadyne shall prepare and timely make any filings required to be
made pursuant to Brazilian antitrust Legal Requirements with respect to the transactions
contemplated hereby, and Buyer shall have the opportunity to review and approve such filings prior
to their submission to Brazilian regulatory authorities.

6.3. Operation of Business. Prior to the Closing, Stanadyne and Seller shall not, and
Seller shall cause PEPL not to, engage in any practice, take any action, or enter into any
transaction with respect to the conduct of the Business outside the Ordinary Course of Business.
In addition, from the date of this Agreement to the Closing Date, without the prior written consent
of Buyer, which consent shall not be unreasonably withheld, neither Seller nor Stanadyne shall, and
Seller shall cause PEPL not to, as relates to the Business, the PEPL Quotas or the Acquired Assets:

(a) sell, pledge, lease, dispose of or grant any Lien on, other than Permitted Liens
(collectively, “Transfer”), or otherwise authorize the Transfer of any of the
Acquired Assets except for (i) Transfers of Inventory and (ii) Transfers of Acquired
Assets having a value of less than $500 individually, in each case in the Ordinary Course
of Business;

(b) sell, pledge or otherwise Transfer any of the PEPL Quotas;

(c) except as required to transfer the PEPL Quotas in connection with this Agreement,
change or authorize any change in the Organizational Documents, as they relate to the
Business;

(d) adopt a plan of complete or partial liquidation or undertake a dissolution;

(e) incur any Liabilities that are Assumed Liabilities, except in the Ordinary Course
of Business;

(f) modify or amend in any material respect or terminate any of the Material
Contracts, Real Property Leases, Seller Permits or other instruments material to the
Business, or waive, release or assign any rights or claims of substantial value, except as
required by applicable Legal Requirements;

(g) enter into any Contractual Obligation that, if it had been entered into as of the
date hereof, would constitute a Material Contract;

(h) award or increase any bonuses, salaries, or other compensation to any Transferred
Employee or employee of PEPL, other than increases in the Ordinary Course of Business for
employees other than senior management of the Business, enter into or take any action with
respect to any existing employment, severance, or similar Contractual Obligation with any
Transferred Employee, or enter into any agreement, contract, arrangement or understanding
with any U.S. or foreign labor union representing employees of the Business except as
required by Legal Requirements or pursuant to the terms of any existing contract or
collective bargaining agreement set forth in §3.16 of the Disclosure Schedule;

(i) transfer any Employee Plan (including any related Liabilities) that is not an
Acquired Employee Plan to PEPL;

(j) make any change in the key management structure of Seller or PEPL, including
without limitation the hiring of additional officers or the termination of existing
officers;

(k) adopt, enter into or amend any Employee Plan, agreement, trust, fund or other
arrangement for the benefit or welfare of any employee of PEPL or Transferred Employee,
except for any such amendment as may be required to comply with applicable Legal
Requirements and those amendments with respect to group plans covering Transferred
Employees that are across-the-board changes;

(l) fail to use its commercially reasonable efforts to (i) retain Seller’s or PEPL’s
employees, (ii) maintain the Business so that such employees will remain available to
Buyer on and after the Closing Date; or

(m) establish or increase the benefits payable or to be provided under any Employee
Plan or establish any new bonus, insurance, severance, deferred compensation, pension,
retirement, profit sharing or other employee benefit plan for Transferred Employees;

(n) revalue any of the Acquired Assets, including, without limitation, writing off
receivables or reserves or revaluing Inventory, other than as required by GAAP, applied
consistently with past practice, or applicable Legal Requirements;

(o) change any method of accounting or accounting practice with respect to the
Business, other than such changes required by a change in Legal Requirements or GAAP;

(p) acquire capital stock of or other ownership interests in, or merge or consolidate
with, or purchase substantially all of the assets of, or otherwise acquire any material
assets or business of, any Person or any other business organization or division thereof;

(q) make any capital expenditure or incur any Liability therefor, except as set forth
on Schedule 6.3(q);

(r) fail to maintain the Acquired Assets in substantially their current state of
repair, excepting normal wear and tear, or fail to replace, consistent with past practice,
inoperable, worn-out, obsolete or destroyed Acquired Assets;

(s) settle any Actions in a manner that would affect the Acquired Assets or for which
any Liability would be reflected on the Final Closing Balance Sheet;

(t) make any loans or advances to any Person that would be reflected on the Final
Closing Balance Sheet or included in the Acquired Assets;

(u) collect accounts receivable and pay accounts payable other than in the Ordinary
Course of Business;

(v) change any material election in respect of Taxes (other than elections reflected on
the 2005 Brazilian income tax return), settle or compromise any Tax claim, or consent to any
extension or waiver of the limitation period applicable to any Tax claim;

(w) file an IRS Form 8832 to change PEPL’s classification for U.S. income tax purposes;

(x) (i) make, pay or declare any dividend or distribution with respect to the PEPL
Quotas; (ii) redeem or repurchase any of the PEPL Quotas; or (iii) issue or grant any PEPL
Quotas or rights (including options) to acquire any PEPL Quotas;

(y) do any other act that would cause any condition set forth in §7.1 not to be
satisfied; or

(z) enter into a Contractual Obligation to do any of the foregoing, or authorize or
announce an intention to do any of the foregoing.

6.4. Taxes.

(a) Buyer and Seller agree to furnish or cause to be furnished to each other, upon
request, as promptly as practicable, such information (including access to books and
records and individuals) and assistance relating to the Business as is reasonably
requested for the filing of any Tax Return and any other filings in connection with the
transactions contemplated by this Agreement or otherwise and for the preparation of any
audit and for the prosecution or defense of any Tax claim. Buyer and Seller agree that
each shall preserve and keep all books and records with respect to Taxes and Tax Returns
in such party’s possession as of the Closing Date, or as later come into such party’s
possession, until the expiration of the applicable statute of limitations. Any
information obtained under this Section 6.4(a) shall be kept confidential except (i) as
may be otherwise necessary in connection with the filing of Tax Returns or claims for
refund or in conducting an audit or other proceeding or (ii) with the consent of Buyer or
Seller, as the case may be.

(b) Seller shall reasonably determine in good faith and advise Buyer in writing as
soon as practicable and in any event within 60 days after the Closing Date whether an
election under Section 338 of the Code with respect to the acquisition of PEPL (the
“338 Election”) can be made without any adverse effect on Seller. If Seller
determines that there is no adverse effect, Buyer may make a 338 Election without the
Seller’s prior written consent. If Seller determines that there is an adverse effect,
Buyer shall not make a 338 Election without the Seller’s prior written consent. Seller
shall provide Buyer with (i) a reasonably detailed calculation of the Tax liability that
Seller would incur as a result of Buyer making a 338 Election and (ii) a reasonably
detailed calculation of the amount Seller would need to be paid so that on an after-Tax
basis, there is no incremental Tax owed by Seller as a result of Buyer making a 338
Election. Buyer and Seller shall negotiate in good faith to determine the amount, if any,
that Seller would need to be paid so that on an after-Tax basis there is no incremental
Tax owed by Seller as a result of Buyer making a 338 Election and if Buyer agrees to pay
such amount to Seller, then Seller will consent to Buyer making such election.

(c) PEPL and Other Returns. Seller shall prepare or cause to be prepared all
Tax Returns for PEPL that are required to be filed on or before the Closing Date. Except
to the extent otherwise required by law and except with respect to the 2005 Brazilian
income tax return, such Tax Returns shall be prepared on a basis consistent with the past
practices of such entities. Buyer shall prepare all Tax Returns of PEPL and all Tax
Returns relating to the Business that are required to be filed after the Closing Date.
Buyer shall provide Seller with drafts of all income Tax Returns of PEPL for all
Pre-Closing Tax Periods (including Tax Returns that cover Straddle Periods) prepared by
Buyer no later than thirty (30) days prior to the earlier of the due date or filing date
thereof. Seller shall have the right to review and provide comments on Returns during the
fifteen (15)-day period following the receipt of such Returns and Buyer shall accept all
reasonable comments to the extent such comments affect Taxes of PEPL in a Pre-Closing Tax
Period. No later than five (5) Business Days prior to the due date for the payment of any
Taxes with respect to any such Tax Return (giving effect to extensions) or five (5)
Business Days following written request from the Buyer, whichever is later, the Seller
shall pay the Buyer an amount equal to the portion of Taxes attributable to the
Pre-Closing Tax Period, as determined pursuant to the principles set forth in Section
6.4(d), except to the extent such Taxes are accrued on the Final Closing Balance Sheet and
taken into account in determining Closing Date Net Working Capital.

(d) For purposes of this Agreement, in the case of any Taxes that are payable for a
taxable period that begins on or before, and ends after the Closing Date (a “Straddle
Period”), the portion of such Taxes that is attributable to the Pre-Closing Tax Period
shall (i) in the case of any property or ad valorem Taxes, be deemed to be the amount of
such Tax for the entire Tax period multiplied by a fraction the numerator of which is the
number of days in the Tax period ending on the Closing Date and the denominator of which
is the number of days in the entire Tax period, and (ii) in the case of all other Taxes,
be deemed equal to the amount which would be payable as computed on a
“closing-of-the-books” basis if the relevant Tax period ended on the Closing Date. The
portion of such Taxes that is attributable to the Post-Closing Tax Period shall be equal
to the total amount of Tax for such Straddle Period less the amount of Tax that is
allocable to the Pre-Closing Tax Period.

(e) Tax Contests. Buyer shall promptly notify the Seller in writing upon
receipt by PEPL of a written notice of any pending or threatened Tax audits or assessments
for which Seller may have liability pursuant to this Agreement; provided,
however, that no delay on the part of the Buyer in notifying the Seller shall
relieve the Buyer from any obligation hereunder unless (and then solely to the extent)
Seller is thereby prejudiced. Seller shall have right to control the conduct of any audit
or assessment of Tax of PEPL for a period that ends on or prior to the Closing Date and
for any audit or assessment of withholding Tax on the transfer of the PEPL Quotas (each
such claim, a “Seller’s Tax Contest Claim”) so long as (i) Seller notifies the
Buyer in writing within 30 days after the Buyer notifies the Seller of such Tax Contest
Claim that the Seller shall indemnify the Buyer in connection with such Seller’s Tax
Contest Claim, (ii) Seller conducts the defense of the Seller’s Tax Contest Claim actively
and diligently, (iii) Seller pays the fees and disbursements incurred in connection with
the Seller’s Tax Contest Claim and (iv) Seller keeps the Buyer informed regarding the
progress and substantive aspects of the Seller’s Tax Contest Claim. Seller shall not
compromise or settle any Seller’s Tax Contest Claim, without obtaining the Buyer’s
consent, which consent shall not be unreasonably withheld or delayed. Buyer shall have
the right to control the conduct of any audit or assessment of Tax of PEPL for any
Straddle Period, provided if Seller could have any liability pursuant to this
Agreement for Taxes owed with respect to a Straddle Period Tax claim (such claim, a
“Straddle Period Tax Contest Claim”), Buyer and Seller shall jointly engage
Deloitte & Touche or such other internationally recognized accounting firm as Buyer and
Seller mutually agree to conduct the defense of such Straddle Period Tax Contest Claim
taking into account the interests of Buyer and Seller. Neither Buyer nor Seller shall
settle any Straddle Period Tax Contest Claim without obtaining written consent of the
other party hereto, provided that such consent shall not be unreasonably withheld,
conditioned, or delayed. Except as otherwise provided herein, Buyer shall control all
other audit, examinations or administrative proceedings in respect of Taxes of PEPL. To
the extent of any conflict between this § 6.4(e) and § 9.4, this § 6.4(e) shall control.

(f) Seller’s Post-Closing Obligation for Taxes. Seller shall promptly pay
after the Closing when due all Taxes for Pre-Closing Tax Periods that have given rise to, or
could give rise to, a Lien on the Acquired Assets in the hands of the Buyer, except for (i)
any non-Income Taxes of the Seller for Pre-Closing Tax Periods that are Assumed Liabilities
and (ii) any Transfer Taxes to be paid by Buyer pursuant to § 11.12. For purposes of this
obligation, the Taxes for any Pre-Closing Tax Period shall be determined under § 6.4(d)
hereof.

(g) Refunds. Any tax refunds of PEPL that are received by PEPL, and any
amounts credited against Taxes that would otherwise be payable by PEPL in a Post-Closing Tax
Period, with respect to Taxes paid by PEPL in a Pre-Closing Tax Period (net of reasonable
out-of-pocket expenses incurred to obtain such Tax refunds or credit and net of any Taxes
imposed on PEPL as a result of the receipt of such Tax refund or credits) shall be for the
account of Seller and Buyer shall pay over to Seller any such refund or the amount of any
such credit within 15 days after receipt or entitle thereto. In addition, to the extent
that a claim for Tax refund or a Tax proceeding results in a payment or credit against Tax
by a taxing authority to Buyer or PEPL of any Tax liability accrued on the Final Closing
Balance Sheet and taken into account in the calculation of Closing Working Capital, Buyer
shall pay such amount (net of any reasonable out-of-pocket expenses incurred to obtain such
Tax refund or credit and net of any Taxes imposed on Buyer or PEPL as a result of the
receipt of such Tax refunds or credit) to Seller within 15 days after receipt or entitle
thereto. Notwithstanding the foregoing, Seller shall not be entitled to receive any Tax
refunds or credits of PEPL (i) that arise from the carryback of an item of loss, deduction,
credit or other Tax benefit which arises after the Closing Date or (ii) that are set forth
on the Final Closing Balance Sheet and included in the calculation of Closing Working
Capital.

6.5. Preservation of Business. Prior to the Closing, Seller shall, and shall cause
PEPL to, (i) operate the Business in the Ordinary Course of Business, (ii) use commercially
reasonable efforts to keep the Business and Acquired Assets substantially intact, including the
present operations, physical facilities, working conditions, (iii) comply in all material respects
with all Legal Requirements applicable to the Business, and (iv) use commercially reasonable
efforts to preserve relationships with lessors, licensors, suppliers, customers, and employees
relating to the Business.

6.6. Full Access.

(a) Prior to the Closing, Seller shall permit and shall cause PEPL to permit
representatives of Buyer to have full access at all reasonable times, and in a manner not
to unreasonably interfere with Seller’s or PEPL’s operation of the Business, to all
premises, properties, personnel, books, records, Contractual Obligations, and documents of
or pertaining to the Business, and shall promptly furnish to Buyer any additional
financial, operating and other data and information concerning the Business as Buyer and
its representatives may reasonably request. Prior to Closing, Buyer shall treat and hold
as confidential any such Confidential Information it receives from Seller or PEPL, and
shall not use any of the Confidential Information, except in connection with this
Agreement or as required by applicable Legal Requirements or any listing agreement with a
national securities exchange. If this Agreement is terminated for any reason whatsoever,
Buyer shall return to Seller all tangible embodiments (and copies) of the Confidential
Information which are in its possession.

(b) Prior to the Closing, Seller shall permit Buyer or its representatives to contact
such customers and suppliers of the Business as Buyer may reasonably request in order to
conduct reasonable due diligence on the relationship of such customers and suppliers with
the Business and to discuss product performance and supply issues.

(c) Buyer shall have the right, at its sole cost and expense, to (A) conduct tests of
the soil, surface or subsurface waters, and air quality at, in, on, beneath or about the
Owned Real Property and the Leased Real Property, and such other procedures as may be
deemed appropriate by Buyer, (B) inspect records, reports, permits, applications,
monitoring results, studies, correspondence, data and any other information or documents
relevant to environmental conditions or environmental noncompliance, and (C) inspect all
buildings and equipment at the Tallahassee Facility and the Curitiba Facility, including
without limitation the visual inspection of such facilities for asbestos-containing
construction materials; provided that, in each case, such tests and inspections shall be
conducted only during regular business hours and in a manner which will not unreasonably
interfere with the operation of the Business and/or the use of, access to or egress from
such facilities.

6.7. Notice of Developments. Prior to the Closing, the Parties shall give prompt
written notice to the other Parties of (i) any material development causing or reasonably expected
to cause a breach of any of its own representations and warranties in §§3, 4 and 5 above, (ii) any
material failure to comply with or satisfy any of its respective covenants, conditions or
agreements required to be complied with or satisfied by it under this Agreement, and (iii) any
fact, event, circumstance, change, condition or effect that has had or would reasonably be expected
to have a Material Adverse Effect, or if PEP Group experiences a material adverse change in its
relationship with any customer or supplier. No disclosure by any Party pursuant to this §6.7,
however, shall be deemed to amend or supplement the Disclosure Schedule or to prevent or cure any
misrepresentations, breach of warranty, or breach of covenant. Seller and PEPL shall provide Buyer
with an unaudited consolidated balance sheet and the related statements of income and cash flows
for the Business, prepared in a manner consistent with that used previously for comparable interim
financial reports of Seller and PEPL, for each month, from the date hereof through the Closing
Date, as soon as practicable after the end of such month, but in any event within 15 Business Days.

6.8. Future Assurances. At any time and from time to time after the Closing, at the
request of Buyer and without further consideration, Seller or Stanadyne shall execute and deliver,
and Seller shall cause PEPL to execute and deliver, such other instruments of sale, transfer,
conveyance, assignment and confirmation and take such action as Buyer may reasonably determine is
necessary to transfer, convey and assign to Buyer, and to confirm Buyer’s title to or interest in
the Acquired Assets, to put Buyer in actual possession and operating control thereof and to assist
Buyer in exercising all rights with respect thereto.

6.9. Employees and Employee Benefits.

(a) Employment. Effective immediately prior to the Closing Date, Seller
shall terminate the employment and Buyer shall offer employment (such employment to be
effective immediately following the Closing) to those individuals Buyer desires to hire
who are, as of the Closing, active full time or part time employees of the Business,
excluding employees employed by PEPL whose employment will continue without interruption
or changes (the “Transferred Employees”), on terms determined by Buyer, in its
sole discretion.

(b) Seller Plans. Except with respect to Acquired Employee Plans and Assumed
Liabilities related to Transferred Employees pursuant to §2.3(b), Seller shall be solely
responsible for the Employee Plans and all obligations and liabilities thereunder. Except
with respect to Acquired Employee Plans and Assumed Liabilities pursuant to §2.3(b)
related to Transferred Employees, Buyer shall not assume any of the Employee Plans or any
obligation or liability thereunder.

(c) Buyer Plans. Buyer shall be responsible for all liabilities and
obligations arising with respect to compensation or benefits provided to Transferred
Employees under employee benefit plans of the Buyer after the Closing.

(d) Records. Seller shall provide Buyer with all employment-related records
necessary to continue the employment of the Transferred Employees, except that if the
provision of such records requires consent of the Transferred Employees under applicable
Legal Requirements, such records will be provided to Buyer only following receipt of such
consent. After the date of this Agreement, Seller and PEPL shall provide Buyer reasonable
access to, and facilitate meetings with, the Transferred Employees and the employees of
PEPL for purposes of making announcements concerning and preparing for the consummation
of, the transactions contemplated by this Agreement. Neither Seller nor PEPL shall,
without the prior written consent of Buyer (which consent shall not be unreasonably
withheld), make any material communications to the Transferred Employees or the employees
of PEPL regarding the transactions contemplated by this Agreement other than those
required under the terms of the Employee Plans or in accordance with Legal Requirements.
Seller and PEPL shall provide to Buyer such information as Buyer may reasonably request
with respect to compensation, benefit plan designs, service and other information
reasonably relating to Seller’s and PEPL’s employment of the Transferred Employees and the
employees of PEPL, respectively.

(e) Worker Notification. On or before the Closing Date, Seller shall provide
to Buyer a list of the name and site of employment of any and all employees of the
Business who have experienced, or will experience, an employment loss or layoff – as
defined by WARN – within ninety (90) days prior to the Closing Date. Seller shall update
this list up to and including the Closing Date. Seller shall not, at any time ninety (90)
days before the Closing Date, without complying fully with the notice requirements and
other requirements of the WARN Act, effectuate (i) a plant closing as defined in the WARN
Act affecting any site of employment or one or more facilities or operating units within
any site of employment of the Business; (ii) a mass layoff as defined in the WARN Act
affecting any site of employment of the Business; or (iii) any similar action under the
WARN Act requiring notice to employees in the event of an employment loss or layoff.

(f) No Right of Employment. Nothing contained herein, expressed or implied,
is intended to confer upon any Transferred Employee any right to continued employment for
any period by reason of this Agreement, nor shall anything herein interfere with the right
of Buyer to terminate the employment of any Transferred Employee at any time, with or
without cause, or restrict Buyer in the exercise of its independent business judgment in
modifying any of the terms and conditions of the employment of the Transferred Employees.
Nothing contained herein is intended to confer upon any Transferred Employee any
particular term or condition of employment in the future.

(g) Within three Business Days after the date of this Agreement, Seller will provide
to Buyer a schedule that is a correct and complete in all material respects as of the date
of such schedule, of all present full-time, part-time and temporary employees (including
any such employee who is on a leave of absence or on layoff status or entitled to any job
tenure or guarantee) of each of (i) Seller related to the Business and (ii) PEPL,
including with respect to each such employee: (a) the employee’s name; (b) aggregate
dollar amounts of total compensation and all share-based incentive grants for the most
recently ended fiscal year; (c) such employee’s annualized base salary and bonus
opportunity as of the date of this Agreement; (d) a job title for such employee; (e) the
location of such employee’s principal place of employment; (f) each employee’s date of
hire and (g) whether the employee is in active employment or on a leave of absence
(including the date of leave commencement and expected return date).

6.10. Exclusivity. From the date hereof through the Closing Date or earlier
termination of this Agreement pursuant to Section 10, neither Stanadyne nor any of its subsidiaries
(including Seller and PEPL) shall, nor shall any of them knowingly permit its respective
Affiliates, officers, directors, employees, representatives and agents to, directly or indirectly,
encourage, solicit, participate in, consider or initiate discussions or negotiations with, or
provide any information to, any Person or group of Persons (other than Buyer and any of its
Affiliates) in furtherance of any merger, sale of assets, sale of shares of capital stock or
similar transactions involving Seller or PEPL. Without limiting the obligations under the
preceding sentence, Stanadyne and Seller shall immediately notify Buyer (orally and in writing) if
any inquiry or proposal is made, any information is requested or any offer is made with respect to
Seller, PEPL, the Business or any Acquired Assets.

6.11. Termination of Related-Party Arrangements. Seller shall cause all Contractual
Obligations described in §3.18 of the Disclosure Schedule, other than those listed in Schedule
6.11, to be terminated immediately prior to the Closing with no further liability or obligation
on the part of any party thereto.

6.12. Confidentiality. For a period of three (3) years after the Closing Date,
neither Seller nor Stanadyne will, and each will not permit its officers, directors, employees,
accountants, counsel, consultants, advisors and agents and Affiliates to, directly or indirectly,
disclose or use or authorize, license or otherwise permit other Persons to use in any way that is
detrimental to Buyer or the Business any and all information concerning (i) the Business or (ii)
Buyer and its Affiliates obtained in the performance of this Agreement or the Ancillary Agreements,
other than that information which is already generally or readily obtainable by the public, or is
publicly known or becomes publicly known through no fault of Seller, or is required by applicable
Legal Requirements to be disclosed.

6.13. Operations. After the Closing Date, Seller shall not continue to operate or
conduct any business under the name “Precision Engine Products Corp.”

7. Conditions to Obligation to Close.

7.1. Conditions to Obligation of Buyer. The obligation of Buyer to consummate the
transactions to be performed by it in connection with the Closing is subject to satisfaction of the
following conditions on or prior to the Closing:

(a) Representations and Warranties. The representations and warranties of
Seller set forth in §3 and of Stanadyne set forth in §4 above (A) if subject to any
limitations as to “material” or “Material Adverse Effect,” shall be true and correct in
all respects on the date of this Agreement and at and as of the Closing as if made at and
as of such time (except to the extent expressly by its terms made as of an earlier date,
in which case as of such earlier date), and (B) if not subject to any limitations as to
“material” or “Material Adverse Effect,” shall be true and correct in all material
respects on the date of this Agreement and at and as of the Closing as if made at and as
of such time (except to the extent expressly by its terms made as of an earlier date, in
which case as of such earlier date);

(b) Performance by Seller and Stanadyne. Each of Seller and Stanadyne shall
have performed and complied in all material respects with all of its covenants, agreements
and obligations hereunder through the Closing;

(c) Consents. Seller and Stanadyne shall have procured all of the
governmental approvals, consents or authorizations and third party consents listed on
Schedule 7.1(c);

(d) Environmental Permits. All of the Environmental Permits listed on §3.12 of
the Disclosure Schedule, to the extent required by law to be transferred prior to the
Closing, shall have been transferred or reissued to Buyer or Buyer’s designee without
modifications to the terms and conditions thereof, unless such modifications are solely
attributable to any acts or omissions of Buyer.

(e) Material Adverse Effect. Since the date of this Agreement, there shall
have been no events, changes or effects that, individually or in the aggregate, have had,
or would reasonably be expected to result in, a Material Adverse Effect;

(f) Absence of Litigation. No Action shall be pending or threatened wherein
an unfavorable injunction, judgment, order, decree, ruling, or charge would (i) prevent
consummation of any of the transactions contemplated by this Agreement, (ii) cause any of
the transactions contemplated by this Agreement to be rescinded following consummation, or
(iii) would be reasonably likely to have a Material Adverse Effect or affect adversely the
right of Buyer to own the Acquired Assets or the PEPL Quotas or to operate the Business
(and no such injunction, judgment, order, decree, ruling, or charge shall be in effect);
and no Legal Requirement shall be in effect that would prohibit or make illegal the
transactions contemplated by this Agreement;

(g) Certificates. Seller and Stanadyne shall have each delivered to Buyer a
certificate of an executive officer of Seller and Stanadyne, respectively, to the effect
that each of the conditions specified above in §7.1(a) and (b) are satisfied in all
respects;

(h) Seller shall have delivered to Buyer a certificate of “non-foreign status” as
provided in Treasury Regulations under Code Section 1445;

(i) Ancillary Agreements. Each of Seller and Stanadyne shall have executed
and delivered the Ancillary Agreements to which it is a party as of the Closing Date;

(j) Title Policy. Buyer shall have received a current ALTA form extended
coverage owner’s policy or policies of title insurance, insuring fee title to the Owned
Real Property with no exceptions that pertain to any Lien securing any Debt that is not an
Assumed Liability; and

(k) All Necessary Actions. All actions to be taken by Seller, Stanadyne or
PEPL in connection with the consummation of the transactions contemplated hereby and all
certificates, opinions, instruments and other documents required to effect the
transactions contemplated hereby shall be reasonably satisfactory in form and substance to
Buyer.

7.2. Conditions to Obligations of Seller. The obligation of Seller to consummate the
transactions to be performed by it in connection with the Closing is subject to satisfaction of the
following conditions on or prior to the Closing:

(a) Representations and Warranties. The representations and warranties of
Buyer set forth in §5 above (A) if subject to any limitations as to “material” shall be
true and correct in all respects on the date of this Agreement and at and as of the
Closing as if made at and as of such time (except to the extent expressly by its terms
made as of an earlier date, in which case as of such earlier date), and (B) if not subject
to any limitations as to “material” shall be true and correct in all material respects on
the date of this Agreement and at and as of the Closing as if made at and as of such time
(except to the extent expressly by its terms made as of an earlier date, in which case as
of such earlier date);

(b) Performance by Buyer. Buyer shall have performed and complied in all
material respects with all of its covenants hereunder through the Closing;

(c) Consents. Buyer shall have procured all of the governmental approvals,
consents or authorizations and third party consents specified in Schedule 7.2(c);

(d) Absence of Litigation. No Action shall be pending or threatened wherein
an unfavorable injunction, judgment, order, decree, ruling, or charge would (i) prevent
consummation of any of the transactions contemplated by this Agreement or (ii) cause any
of the transactions contemplated by this Agreement to be rescinded following consummation
(and no such injunction, judgment, order, decree, ruling, or charge shall be in effect),
and no Legal Requirement shall be in effect that would prohibit or make illegal the
transactions contemplated by this Agreement;

(e) Certificate. Buyer shall have delivered to Seller a certificate of an
executive officer of Buyer to the effect that each of the conditions specified above in
§7.2(a) and (b) is satisfied in all respects;

(f) Ancillary Agreements. Buyer shall have executed and delivered the
Ancillary Agreements to which it is a party as of the Closing Date; and

(g) All Necessary Actions. All actions to be taken by Buyer in connection
with the consummation of the transactions contemplated hereby and all certificates,
opinions, instruments and other documents required to effect the transactions contemplated
hereby shall be reasonably satisfactory in form and substance to Seller.

8. Post-Closing Covenants.

8.1. Noncompetition and Nonsolicitation.

(a) Seller. For a period of five (5) years from and after the Closing Date,
neither Seller, Stanadyne, nor any of the Stanadyne Affiliates shall engage directly or
indirectly in any portion of, or own, manage, join, operate or control, or participate in
the ownership, management, operation or control of, or permit their respective names to be
used by or in connection with, any Person that engages directly or indirectly in any
portion of, the Business as conducted by Seller as of the Closing Date; provided,
however, that (i) no owner of less than 5% of the outstanding stock of any
publicly-traded corporation shall be deemed to be so engaged solely by reason thereof and
(ii) this §8.1 shall not in any manner limit, restrict or otherwise preclude Seller,
Stanadyne and their Affiliates from continuing after the Closing to operate their
respective businesses as currently conducted (excluding, subject to the following
sentence, the Business). Buyer acknowledges and agrees that (i) Stanadyne and certain of
Stanadyne’s and Seller’s Affiliates are in the engine components business and (ii) nothing
in this §8.1 shall be deemed to restrict or otherwise impair Stanadyne, Seller and such
Affiliates from engaging in such businesses as currently conducted following the Closing.
For a period of two (2) years from and after the Closing Date, neither Seller nor
Stanadyne shall recruit, offer employment to, employ, engage as a consultant, lure or
entice away, or in any other manner persuade any Person who was an employee of Seller with
respect to the Business immediately prior to the Closing to leave the employ of Buyer,
excluding (i) general solicitations by newspaper or other public media or non-directed
third-party search firm and (ii) the employees listed on Schedule 2.7(f)(vi).

(b) Buyer. Except as provided in §6.9(a), for a period of two (2) years from
and after the Closing Date, neither Buyer nor any of its Affiliates shall recruit, offer
employment to, employ, engage as a consultant, lure or entice away, or in any other manner
persuade any Person who is an employee of Stanadyne to leave the employ of Stanadyne,
excluding general solicitations by newspaper or other public media or non-directed
third-party search firm.

(c) If any provision contained in this §8.1 is for any reason held invalid, illegal
or unenforceable in any respect, such invalidity, illegality or unenforceability will not
affect any other provisions of this §8.1, and this §8.1 will be construed as if such
invalid, illegal or unenforceable provision had never been contained herein. It is the
intention of the Parties that if any of the restrictions or covenants contained in this
§8.1 is held to cover a geographic area or to be of a length of time that is not permitted
by applicable Legal Requirements, or in any way construed to be too broad or to any extent
invalid, such provision will not be construed to be null, void and of no effect. Instead,
the Parties agree that a court of competent jurisdiction will construe, interpret, reform
or judicially modify this §8.1 to provide for a covenant having the maximum enforceable
geographic area, time period and other provisions (not greater than those contained
herein) as will be valid and enforceable under such applicable Legal Requirements.

(d) The Parties agree that a violation of this §8.1 by Seller or Stanadyne will cause
irreparable injury to Buyer, and a violation of this §8.1 by Buyer will cause irreparable
injury to Seller and Stanadyne, and that such injured Party will be entitled, in addition
to any other rights and remedies it may have at law or in equity to apply for an
injunction enjoining and restraining the other Party or Parties from doing or continuing
to do any such act and any other violations or threatened violations of this §8.1, and
such Party or Parties consent to the entry thereof. In the event that any Party is found
to have breached any covenant in this §8.1, the time period provided for in that covenant
shall be tolled (i.e., it shall not run) for so long as such Party was in violation of
that covenant.

8.2. Accounts Receivable and Correspondence. At the Closing, Buyer will acquire
hereunder, and thereafter Buyer or its designee shall have the right and authority to collect for
Buyer’s or its designee’s account, all receivables, letters of credit and other items which
constitute a part of the Acquired Assets, and Seller shall, within forty-eight (48) hours after
receipt of any payment in respect of any of the foregoing, properly endorse and deliver to Buyer
any letters of credit, documents, cash or checks received on account of or otherwise relating to
any such receivables, letters of credit or other items. Seller shall promptly transfer or deliver
to Buyer or its designee any cash or other property that Seller may receive in respect of any
deposit, prepaid expense, claim, contract, license, lease, commitment, sales order, purchase order,
letter of credit or receivable of any character, or any other item, constituting a part of the
Acquired Assets. After the Closing, Seller shall promptly deliver to Buyer any mail (physical,
electronic or otherwise), facsimile or other correspondence or communication received by Seller to
the extent related to the Business or any of the Acquired Assets, including any such correspondence
or communication from any customer, supplier or Governmental Authority.

8.3. Warranty Claims. Buyer agrees that, at Seller’s request, it shall supply Seller
with any Products necessary to satisfy Warranty Claims for which Seller is responsible following
the Closing at a price no higher than that then being charged to any of Buyer’s customers for such
Products. Any such claims satisfied by Buyer at Seller’s request shall be reimbursed to Buyer by
Seller within fifteen (15) days of the receipt of an invoice from Buyer requesting such
reimbursement.

9. Indemnification.

9.1. Indemnity by Seller.

(a) Seller and Stanadyne hereby agree, jointly and severally, to indemnify, defend
and hold harmless each of Buyer, its subsidiaries and its Affiliates, and each of their
respective directors, officers, shareholders, owners, agents and Affiliates (collectively,
the “Buyer Indemnified Parties”) against and in respect of all liabilities,
damages, losses, fines, penalties, expenses, fees, costs (including reasonable attorneys’
fees and disbursements in connection with investigating, defending or settling any action
or threatened action), and amounts paid in settlement (collectively, the
“Losses”), whether or not involving any third party claims, that arise out of or
result from:

(i) the inaccuracy or breach of any representation or warranty made by Seller
or Stanadyne herein for which Buyer provides notice to Seller (setting forth in such
detail as is available facts necessary to evaluate such inaccuracy and to
substantiate the Losses claimed) on or prior to the date that is eighteen (18)
months after the Closing Date, except with respect to (i) any representation or
warranty contained in §§ 3.1 (Seller Organization), 3.2 (Seller Authorization of
Transaction), 3.4 (Seller Brokers’ Fees), 3.5 (Seller Ownership of PEPL Quotas), 3.7
(Title to Assets), 4.1 (Stanadyne Organization), 4.2 (Stanadyne Authorization of
Transaction), 4.4 (Stanadyne Brokers’ Fees) and 4.5 (Stanadyne Ownership of PEPL
Quotas), which shall survive the Closing indefinitely; and any representation or
warranty with respect to Taxes or § 3.16 (Labor Matters) with respect to any matter
related to PEPL, which shall survive until 60 days after the end of the applicable
statutory limitations period (other than representations or warranties set forth in
the first sentence of § 3.9(k) for which the general eighteen (18) month survival
period described above applies);

(ii) the breach by Seller or Stanadyne of any of its respective covenants
contained herein to be performed prior to the Closing;

(iii) the breach by Seller or Stanadyne of any of its respective covenants
contained herein or in any agreement or instrument required to be entered into in
connection herewith to be performed after to the Closing;

(iv) any Liability of Seller or PEPL which is not an Assumed Liability or which
is an Excluded Liability;

(v) any Pre-Closing Environmental Matters;

(vi) Taxes of PEPL, or Taxes of any other person imposed on PEPL as transferee
or successor, by any contract primarily related to Taxes or otherwise, for any
Pre-Closing Tax Period, except to the extent such Taxes are (1) Transfer Taxes for
which the Buyer is liable pursuant to § 11.12 hereof or (2) accrued as a reserve or
liability on the Final Closing Balance Sheet and included in the calculation of
Closing Working Capital (other than any reserve for deferred Taxes established to
reflect timing differences between book and Tax income); or

(vii) any Brazilian Withholding Taxes.

(b) The aggregate liability for Seller and Stanadyne under §9.1 shall in no event
exceed the Purchase Price. With respect to any indemnification obligation arising under
§9.1(a)(i) and §9.1(a)(ii), (i) Seller and Stanadyne shall not be liable for Losses with
respect to any claim unless such claim (together with other claims that arise out of the
same set of facts or circumstances and are so reasonably related as to effectively
constitute one claim) exceeds $5,000, and (ii) Seller and Stanadyne shall be liable in
respect of Losses only if the aggregate of such Losses exceeds $300,000 (the
“Basket”), in which case Seller and Stanadyne shall be liable, jointly and
severally, for all such Losses (including those incurred prior to exceeding the Basket).
In no event shall Seller or Stanadyne (collectively) be obligated to indemnify Buyer
Indemnified Parties in respect of aggregate Losses arising under §9.1(a)(i) and
§9.1(a)(ii) in excess of $3,000,000 (the “Cap”), except that the Basket and the
Cap shall not apply to obligations of Seller and Stanadyne herein to indemnify Buyer
Indemnified Parties in connection with a breach of a representation or warranty contained
in §§3.1 (Seller Organization), 3.2 (Seller Authorization of Transaction), 3.4 (Seller
Brokers’ Fees), 3.5 (Seller Ownership of PEPL Quotas), 3.7 (Title to Assets), 3.9 (Taxes),
4.1 (Stanadyne Organization), 4.2 (Stanadyne Authorization of Transaction), 4.4 (Stanadyne
Brokers’ Fees) and 4.5 (Stanadyne Ownership of PEPL Quotas); provided,
further, that in the case of any representation or warranty that is limited by
“material,” “Material Adverse Effect” or by any similar term or limitation, the occurrence
of a breach or inaccuracy of such representation or warranty, as the case may be, and the
amount of losses subject to indemnification hereunder shall be determined as if
“material,” “Material Adverse Effect” or by any similar term or limitation were not
included therein.

9.2. Indemnity by Buyer.

(a) Buyer hereby agrees to indemnify, defend and hold harmless Seller, Stanadyne,
their subsidiaries and Affiliates, and each of their respective directors, officers,
shareholders, owners, agents and Affiliates (collectively, the “Seller Indemnified
Parties”) against and in respect of all Losses that arise out of or result from:

(i) the inaccuracy or breach of any representation or warranty made by Buyer
herein for which Seller provides notice to Buyer (setting forth in such detail as is
available facts necessary to evaluate such inaccuracy and to substantiate the Losses
claimed) on or prior to the date that is eighteen (18) months after the Closing Date
(except, with respect to any representation or warranty contained in §§5.1
(Organization of Buyer), 5.2 (Authority for Agreement) and 5.5 (Brokers’ Fees),
which shall survive the Closing indefinitely; provided, however,
that in the case of any representation or warranty that is limited by “material,”
“Material Adverse Effect” or by any similar term or limitation, the occurrence of a
breach or inaccuracy of such representation or warranty, as the case may be, and the
amount of losses subject to indemnification hereunder shall be determined as if
“material,” “Material Adverse Effect” or by any similar term or limitation were not
included therein;

(ii) any breach of a covenant of Buyer contained herein or in any agreement or
instrument required to be entered into in connection herewith to be performed prior
to the Closing;

(iii) any breach of a covenant of Buyer contained herein or in any agreement or
instrument required to be entered into in connection herewith to be performed after
to the Closing; or

(iv) any Assumed Liability.

(b) The aggregate liability for Buyer under this §9.2 shall in no event exceed the
Purchase Price. With respect to any indemnification obligation arising under §9.2(a)(i)
or §9.2(a)(ii), (i) Buyer shall not be liable for Losses with respect to any claim unless
such claim (together with other claims that arise out of the same set of facts or
circumstances and are so reasonably related as to effectively constitute one claim)
exceeds $5,000, and (ii) Buyer shall be liable in respect of Losses only if the aggregate
of such Losses exceeds the Basket, in which case Buyer shall be liable for all such Losses
(including those incurred prior to exceeding the Basket). In no event shall Buyer be
obligated to indemnify Seller Indemnified Parties in respect of aggregate Losses arising
under §9.2(a)(i) or §9.2(a)(ii) in excess of the Cap (except that the Basket and the Cap
shall not apply to obligations of Buyer herein to indemnify Seller Indemnified Parties in
connection with a breach of a representation or warranty contained in §§5.1 (Organization
of Buyer), 5.2 (Authority for Agreement) and 5.5 (Brokers’ Fees); provided,
further, that in the case of any representation or warranty that is limited by
“material,” “Material Adverse Effect” or by any similar term or limitation, the occurrence
of a breach or inaccuracy of such representation or warranty, as the case may be, and the
amount of losses subject to indemnification hereunder shall be determined as if
“material,” “Material Adverse Effect” or by any similar term or limitation were not
included therein.

9.3. Tax Treatment of Indemnity Payments. Seller and Buyer agree to treat any
indemnity payments made pursuant to §§9.1 and 9.2 as an adjustment to the Purchase Price for all
Tax purposes.

9.4. Matters Involving Third Parties.

(a) If any third party shall notify any Party (the “Indemnified Party”) with
respect to any matter (a “Third Party Claim”) that may give rise to a claim for
indemnification against another Party (the “Indemnifying Party”) under this §9,
then the Indemnified Party shall promptly notify the Indemnifying Party thereof in
writing; provided, however, that no delay on the part of the Indemnified
Party in notifying the Indemnifying Party shall relieve the Indemnifying Party from any
obligation hereunder unless (and then solely to the extent) the Indemnifying Party is
thereby prejudiced.

(b) The Indemnifying Party shall have the right to defend the Indemnified Party
against the Third Party Claim with counsel of its choice reasonably satisfactory to the
Indemnified Party so long as (i) the Indemnifying Party notifies the Indemnified Party in
writing within 20 days after the Indemnified Party has given notice of the Third Party
Claim that the Indemnifying Party shall indemnify the Indemnified Party in connection with
such Third Party Claim, (ii) settlement of, or an adverse judgment with respect to, the
Third Party Claim is not, in the good faith judgment of the Indemnified Party, likely to
establish a precedential custom or practice adverse to the continuing business interests
of the Indemnified Party, (iii) the Indemnifying Party conducts the defense of the Third
Party Claim actively and diligently, and (iv) the Indemnifying Party pays the fees and
disbursements of such counsel with regards thereto. Prior to the time which the
Indemnifying Party may assume the defense hereunder, the Indemnified Party may take such
actions as are necessary to preserve the ability to defend such Third Party Claim.

(c) Subject to the provisions of §9.4(b) above, (i) the Indemnified Party may retain
separate co-counsel at its sole cost and expense and participate in the defense of the
Third Party Claim; provided, that the reasonable costs and expenses of one counsel
(in addition to local counsel) to the Indemnified Party will be paid by the Indemnifying
Party if (A) in the opinion of counsel to the Indemnified Party, a conflict of interest
exists between the Indemnifying Party and any Indemnified Party or (B) the Third Party
Claim seeks nonmonetary relief, (ii) the Indemnified Party will not consent to the entry
of any judgment or enter into any settlement with respect to the Third Party Claim without
the prior written consent of the Indemnifying Party (which consent shall not unreasonably
be withheld), and (iii) the Indemnifying Party will not consent to the entry of any
judgment or enter into any settlement with respect to the Third Party Claim unless such
settlement is for monetary payments only and a written agreement is obtained releasing the
Indemnified Party from all liability thereunder.

9.5. Survival of Indemnification Claims. The indemnification obligations set forth in
this §9 shall survive the Closing as set forth in §9.1. Any rights with respect to a claimed
breach of a representation or warranty shall expire at the date of termination of the
representation or warranty claimed to be breached as set forth in §9.1 hereof (the “Termination
Date”), unless on or prior to the Termination Date written notice asserting such claimed breach
has been given to Seller; provided, that if any such notice is timely given, the claim to
which such notice relates may continue to be asserted beyond the Termination Date.

9.6. Fraud; Intentional Misrepresentation. Notwithstanding anything contained
in this Agreement to the contrary, in the case of fraud, the limitations on indemnification
(including as to duration and amount) contained in §9.1 or elsewhere in this §9 shall not apply to
any claim for indemnification under this §9 by an Indemnified Party.

9.7. Determination of Loss Amount.

(a) The amount of any Loss subject to indemnification under §9.1(a) shall be
calculated net of (i) any Tax benefit realized in the form of a reduction in cash Tax
payments by the Buyer Indemnified Parties for income tax purposes in the year in which the
Loss was incurred as a result of such Loss and the present value of any Tax benefits
likely to be received in the form of a reduction in cash Tax Payments by the Buyer
Indemnified Parties for income tax purposes in future years as a result of such Loss,
(ii) any reserves or accruals with respect to any Loss solely to the extent of the amount
of such reserve or accrual that is included in the calculation of Closing Working Capital,
and (iii) any insurance proceeds or other amounts under indemnification agreements with
any third party as and when received by the Buyer Indemnified Parties on account of such
Loss, net of any costs or expenses incurred or suffered by the Buyer Indemnified Parties
in recovering such proceeds. The amount of any Losses subject to indemnification under
§9.1 relating to Taxes shall include amounts that would have constituted Losses but for
the set off or other utilization of any loss, deduction or credit arising in a
Post-Closing Tax Period.

(b) The amount of any Loss subject to indemnification under §9.2 shall be calculated
net of (i) any Tax benefit realized in the form of a reduction in cash Tax payments by the
Seller Indemnified Parties for income tax purposes in the year in which the Loss was
incurred as a result of such Loss and the present value of any Tax benefits likely to be
received in the form of a reduction in cash Tax Payments by the Seller Indemnified Parties
for income tax purposes in future years as a result of such Loss and (ii) any insurance
proceeds or other amounts under indemnification agreements with any third party as and
when received by the Seller Indemnified Parties on account of such Loss, net of any costs
or expenses incurred or suffered by the Seller Indemnified Parties in recovering such
proceeds. In the event that an insurance or other recovery is made by any Seller
Indemnified Parties with respect to any Loss for which any such Person has been
indemnified hereunder, then a refund equal to the aggregate amount of the recovery (not to
exceed the amount of the indemnification payment, and net of any related costs or expenses
as provided above) shall be made promptly to the Buyer.

(c) Notwithstanding anything contained in this Agreement to the contrary, neither
Seller nor Stanadyne shall be liable to, or indemnify, the Buyer Indemnified Parties, and
Buyer shall not be liable to or indemnify the Seller Indemnified Parties, for any Losses
that are punitive (except to the extent constituting third party punitive claims).

9.8. Exclusive Remedy. Buyer agrees that the indemnification provided in §9.1 is the
exclusive remedy for a breach by Seller of any representation or warranty contained in §3 of this
Agreement and for a breach by Stanadyne of any representation or warranty contained in §4 of this
Agreement. Seller and Stanadyne agree that the indemnification provided in §9.2 is the exclusive
remedy for a breach by Buyer of any representation or warranty contained in §5 of this Agreement.

10. Termination.

10.1. Termination of Agreement. Any of the Parties may terminate this Agreement as
provided below:

(a) the Parties may terminate this Agreement by mutual written consent at any time
prior to the Closing;

(b) Buyer may terminate this Agreement by giving written notice to Seller at any time
prior to the Closing (i) in the event Seller has breached any representation, warranty, or
covenant contained in this Agreement in any material respect, Buyer has notified Seller of
the breach, and the breach has continued without cure for a period of 30 days after the
notice of breach or (ii) if the Closing shall not have occurred on or before 31 days after
the date of this Agreement by reason of the failure of any condition precedent under §7.1
hereof, or upon the satisfaction of any such condition becoming impossible or
impracticable with the use of commercially reasonable efforts (unless the failure results
primarily from Buyer itself breaching any representation, warranty, or covenant contained
in this Agreement); and

(c) Seller may terminate this Agreement by giving written notice to Buyer at any time
prior to the Closing (i) in the event Buyer has breached any representation, warranty, or
covenant contained in this Agreement in any material respect, Seller has notified Buyer of
the breach, and the breach has continued without cure for a period of 30 days after the
notice of breach or (ii) if the Closing shall not have occurred on or before 31 days after
the date of this Agreement by reason of the failure of any condition precedent under §7.2
hereof, or upon the satisfaction of any such condition becoming impossible or
impracticable with the use of commercially reasonable efforts (unless the failure results
primarily from Seller itself breaching any representation, warranty, or covenant contained
in this Agreement).

10.2. Effect of Termination. If any Party terminates this Agreement pursuant to §10.1
above, all rights and obligations of the Parties hereunder shall terminate without any Liability of
any Party to any other Parties (except for any Liability of any Party then in breach);
provided, however, that the confidentiality provisions contained in §6.6, the
noncompetition and nonsolicitation provisions contained in §8.1, the indemnification provisions
contained in §9, and the miscellaneous provisions set forth in §11 shall survive termination.

11. Miscellaneous.

11.1. Press Releases and Public Announcements. No Party shall issue any press release
or make any public announcement relating to the subject matter of this Agreement prior to or
following the Closing without the prior approval of the other Parties; provided,
however, that any Party may make any public disclosure it believes in good faith is
required by applicable Legal Requirements, in which case the disclosing Party shall consult with
the other party prior to making such disclosure, and the parties shall use commercially reasonable
efforts, acting in good faith, to agree upon a text for such disclosure which is satisfactory to
both parties.

11.2. No Third Party Beneficiaries. This Agreement shall not confer any rights or
remedies upon any Person other than the Parties and their respective successors and permitted
assigns.

11.3. Entire Agreement. This Agreement (including the documents referred to herein)
constitutes the entire agreement among the Parties with respect to its subject matter and
supersedes any prior understandings, agreements, term sheets, letter agreements, or representations
by or among the Parties, written or oral, to the extent they related in any way to the subject
matter hereof.

11.4. Succession and Assignment. This Agreement shall be binding upon and inure to
the benefit of the Parties named herein and their respective successors and permitted assigns. No
Party may assign either this Agreement or any of its rights, interests, or obligations hereunder
without the prior written approval of the other Parties; provided, that without such prior
consent, the Parties shall have the right to assign all or any part of its right, title, interest
or obligations in and to this Agreement to any person or entity acquiring all or substantially all
of either of the Party’s assets or equity interests; provided, further, that
without such prior consent, Buyer shall have the right to assign its right, title, interest and
obligations with respect to the PEPL Quotas to an Affiliate of Buyer so long as Buyer is not
relieved of any liability hereunder.

11.5. Counterparts. This Agreement may be executed in one or more counterparts, each
of which shall be deemed an original but all of which together shall constitute one and the same
instrument.

11.6. Headings. The section headings contained in this Agreement are inserted for
convenience only and shall not affect in any way the meaning or interpretation of this Agreement.

11.7. Notices. All notices, requests, demands, claims, and other communications
hereunder shall be in writing. Any notice, request, demand, claim, or other communication hereunder
shall be deemed duly given (i) upon confirmation of facsimile or email, (ii) one Business Day
following the date sent when sent by overnight delivery by recognized overnight courier service for
delivery on the next Business Day and (iii) five Business Days following the date mailed when
mailed by registered or certified mail return receipt requested and postage prepaid at the
following address:

If to Seller or Stanadyne:

Precision Engine Products Corp.

c/o Stanadyne Corporation

92 Deerfield Road

Windsor, CT 06095

Phone: (860) 525-0821

Fax No.: (860) 683-4500

Attention: Stephen Langin

Email: slangin@stanadyne.com

Copy to:

Kohlberg & Company, L.L.C.

	 	111	 	Radio Circle

	 	 	 	Mt. Kisco, New York 10549

	 	 	 	Attention: Gordon Woodward

	 	 	 	Fax No.: (914) 241-1143

	 	 	 	Email: woodward@kohlberg.com

Copy to:

Ropes & Gray LLP

One International Place

Boston, Massachusetts 02110

Phone: (617) 951-7000

Fax: (617) 951-7050

Attention: Daniel S. Evans, Esq.

Email: daniel.evans@ropegray.com

If to Buyer:

c/o GenTek Inc.

90 East Halsey Road

Parsippany, NJ 07054

Phone:

Fax No: (973) 515-3244

Attention: James Imbriaco

Email: jimbriaco@gentek-global.com

Copy to:

Latham & Watkins LLP

555 Eleventh Street, NW

Suite 1000

Washington, DC 20004

Phone: (202) 637-2200

Fax No.: (202) 637-2201

Attention: Raymond B. Grochowski, Esq.

Email: ray.grochowski@lw.com

Any Party may send any notice, request, demand, claim, or other communication hereunder to the
intended recipient at the address set forth above using any other means (including personal
delivery, expedited courier, messenger service, telecopy, telex, ordinary mail, or electronic
mail), but no such notice, request, demand, claim, or other communication shall be deemed to have
been duly given unless and until it actually is received by the intended recipient. Any Party may
change the address to which notices, requests, demands, claims, and other communications hereunder
are to be delivered by giving the other Parties notice in the manner herein set forth.

11.8. No Additional Representations; Disclaimer. Buyer acknowledges and agrees that
none of Seller, Stanadyne and any other Person acting on behalf of the Seller, Stanadyne or any of
their respective Affiliates has made any representation or warranty, express or implied, as to the
accuracy or completeness of any information regarding the Business or the Acquired Assets, except
as expressly set forth in this Agreement or as and to the extent required by this Agreement to be
set forth in the Disclosure Schedule. Without limitation of the representations and warranties set
forth in §§3 and 4, Buyer further agrees that neither Seller nor any of its Affiliates will have or
be subject to any liability to the Buyer or any other Person resulting from the distribution to
Buyer, or Buyer’s use of, any such information, and any information, document or material made
available to Buyer or its Affiliates in certain “data rooms,” management presentations or any other
form in expectation of the transactions contemplated by this Agreement.

11.9. Governing Law. This Agreement, the rights of the parties and all Actions
arising in whole or in part under or in connection herewith, shall be governed by and construed in
accordance with the internal Laws, and not the Laws governing conflicts of Laws (other than
Sections 5-1401 and 5-1402 of the New York General Obligations Law), of the State of New York.

11.10. Amendments and Waivers. No amendment of any provision of this Agreement shall
be valid unless the same shall be in writing and signed by Buyer, Seller and Stanadyne. No waiver
by any Party of any default, misrepresentation, or breach of warranty or covenant hereunder,
whether intentional or not, shall be deemed to extend to any prior or subsequent default,
misrepresentation, or breach of warranty or covenant hereunder or affect in any way any rights
arising by virtue of any prior or subsequent such occurrence. No failure or delay by any Party in
exercising any right, power or privilege hereunder shall operate as a waiver thereof nor shall any
single or partial exercise thereof preclude any other or further exercise thereof or the exercise
of any other right, power or privilege.

11.11. Severability. Any term or provision of this Agreement that is invalid or
unenforceable in any situation in any jurisdiction shall not affect the validity or enforceability
of the remaining terms and provisions hereof or the validity or enforceability of the offending
term or provision in any other situation or in any other jurisdiction.

11.12. Expenses. Notwithstanding anything to the contrary in Sections 2.3 or 2.4, (i)
Buyer agrees to bear the burden of any sales taxes, use taxes, transfer taxes, documentary charges,
recording or registration fees, stamp taxes or similar taxes (excluding, for the avoidance of
doubt, any Brazilian Withholding Taxes) (“Transfer Taxes”) payable on the transfer of the Acquired
Assets and the PEPL Quotas hereunder, and (ii) Stanadyne and Seller, on the one hand, and Buyer, on
the other hand, each agree to bear 50% of the burden of any filing fees incurred in connection with
any filings made pursuant to Brazilian antitrust Legal Requirements by any parties hereto with
respect to the transactions contemplated hereby. Each of Buyer and Seller shall bear its own costs
and expenses (including legal and accounting fees and expenses) incurred in connection with this
Agreement and the transactions contemplated hereby. Buyer and Seller shall reasonably cooperate
with each other in timely making all filings, returns report an forms as may be required in
connection with the payment of all Transfer Taxes, including but not limited to delivering all
instruments and certificates as are necessary to minimize such Transfer Taxes and enable the other
to timely comply with the filing of any Tax Return that relates to Transfer Taxes.

11.13. Construction. The Parties have participated jointly in the negotiation and
drafting of this Agreement. In the event an ambiguity or question of intent or interpretation
arises, this Agreement shall be construed as if drafted jointly by the Parties and no presumption
or burden of proof shall arise favoring or disfavoring any Party by virtue of the authorship of any
of the provisions of this Agreement. Any reference to any federal, state, local, or foreign
statute or law shall be deemed also to refer to all rules and regulations promulgated thereunder,
unless the context requires otherwise. The word “including” shall mean including without
limitation.

11.14. Incorporation of Exhibits and Schedules. The Exhibits and Schedules identified
in this Agreement are incorporated herein by reference and made a part hereof.

11.15. Consent to Jurisdiction; Venue; Service of Process.

(a) Each Party to this Agreement, by its execution hereof, (i) hereby irrevocably
submits to the exclusive jurisdiction of the state courts of the State of New York or the
United States District Court for the Southern District of New York for the purpose of any
Action among the Parties arising in whole or in part under or in connection with this
Agreement, (ii) hereby waives to the extent not prohibited by applicable Legal
Requirements, and agrees not to assert, by way of motion, as a defense or otherwise, in
any such Action, any claim that it is not subject personally to the jurisdiction of the
above-named courts, that its property is exempt or immune from attachment or execution,
that any such Action brought in one of the above-named courts should be dismissed on
grounds of forum non conveniens, should be transferred or removed to any court other than
one of the above-named courts, or should be stayed by reason of the pendency of some other
proceeding in any other court other than one of the above-named courts, or that this
Agreement or the subject matter hereof may not be enforced in or by such court, and (iii)
hereby agrees not to commence any such Action other than before one of the above-named
courts. Notwithstanding the previous sentence a Party may commence any Action in a court
other than the above-named courts solely for the purpose of enforcing an order or judgment
issued by one of the above-named courts.

(b) Each Party agrees that for any Action among the Parties arising in whole or in
part under or in connection with this Agreement, such Party shall bring Actions only in
the City of New York. Each Party further waives any claim and shall not assert that venue
should properly lie in any other location within the selected jurisdiction.

(c) Each Party hereby (x) consents to service of process in any Action among the
Parties arising in whole or in part under or in connection with this Agreement in any
manner permitted by New York law; (y) agrees that service of process made in accordance
with clause (x) or made by registered or certified mail, return receipt requested, at its
address specified pursuant to §11.7 shall constitute good and valid service of process in
any such Action; and (z) waives and agrees not to assert (by way of motion, as a defense,
or otherwise) in any such Action any claim that service of process made in accordance with
clause (x) or (y) does not constitute good and valid service of process.

11.16. Waiver of Jury Trial. TO THE EXTENT NOT PROHIBITED BY APPLICABLE LEGAL
REQUIREMENTS THAT CANNOT BE WAIVED, THE PARTIES HEREBY WAIVE, AND COVENANT THAT THEY WILL NOT
ASSERT (WHETHER AS PLAINTIFF, DEFENDANT OR OTHERWISE), ANY RIGHT TO TRIAL BY JURY IN ANY ACTION
ARISING IN WHOLE OR IN PART UNDER OR IN CONNECTION WITH THIS AGREEMENT OR ANY OF THE CONTEMPLATED
TRANSACTIONS, WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER SOUNDING IN CONTRACT, TORT OR
OTHERWISE. THE PARTIES AGREE THAT ANY OF THEM MAY FILE A COPY OF THIS PARAGRAPH WITH ANY COURT AS
WRITTEN EVIDENCE OF THE KNOWING, VOLUNTARY AND BARGAINED-FOR AGREEMENT AMONG THE PARTIES
IRREVOCABLY TO WAIVE ITS RIGHT TO TRIAL BY JURY. ANY PROCEEDING WHATSOEVER AMONG THEM RELATING TO
THIS AGREEMENT OR ANY OF THE CONTEMPLATED TRANSACTIONS SHALL INSTEAD BE TRIED IN A COURT OF
COMPETENT JURISDICTION BY A JUDGE SITTING WITHOUT A JURY.

11.17. Specific Performance. The Parties hereby acknowledge and agree that the
failure of any party to perform its agreements and covenants hereunder, including its failure to
take all actions as are necessary on its part to the consummation of the transactions contemplated
hereby, will cause irreparable injury to the other parties, for which damages, even if available,
will not be an adequate remedy. Accordingly, each Party hereby consents to the issuance of
injunctive relief by any court of competent jurisdiction to compel performance of such Party’s
obligations and to the granting by any court of the remedy of specific performance of its
obligations hereunder without proof of actual damages and without any requirement for the securing
or posting of any bond. Such remedy shall not be deemed to be the exclusive remedy for a Party’s
breach of its obligations but shall be in addition to all other remedies available at law or
equity.

11.18. Bulk Sales Laws. Buyer hereby waives compliance with the “bulk sales”
provisions of Article 6 of the Uniform Commercial Code as it is in effect in the states where
Seller owns assets to be conveyed to Buyer hereunder and Seller shall indemnify Buyer with respect
to any noncompliance by Seller with such bulk sales provisions.

[The remainder of this page is intentionally left blank.]

3

IN WITNESS WHEREOF, the Parties hereto have executed this Agreement on the date first above
written.

	 
	 

	Defiance, Inc.

	 

	By:      

	 

	 

	 

	Name:

	 

	 

	 

	Title:

	 

	Precision Engine Products Corp.

	 

	By:      

	 

	 

	 

	Name:

	 

	 

	 

	Title:

	 

	Stanadyne Corporation

	 

	By:      

	 

	 

	 

	Name:

	 

	 

	 

	Title:

	 

4EX-10.1

Exhibit 10.1

STOCK PURCHASE AGREEMENT

AMONG

JEVIC HOLDING CORP.

SAIA MOTOR FREIGHT LINE, INC.

AND

SCS TRANSPORTATION, INC.

June 30, 2006

	 	 	 
	ARTICLE 1 Definitions

	 	

	 
	 	 
	ARTICLE 2 Purchase and Sale of Target Shares

	 
	 	 
	2.1

2.2

2.3

2.4

2.5

	 	Basic Transaction

Deliveries

Purchase Price

The Closing

Allocation of Purchase Price

	 	 	 
	ARTICLE 3 Representations and Warranties Concerning the Transaction

	 
	 	 
	3.1

3.2

	 	Representations and Warranties of the Seller

Representations and Warranties of the Buyer

	 	 	 
	ARTICLE 4 Representations and Warranties Concerning the Target and Its Subsidiaries

	 
	 	 
	4.1

4.2

4.3

4.4

4.5

4.6

4.7

4.8

4.9

4.10

4.11

4.12

4.13

4.14

4.15

4.16

	 	Organization, Qualification, and Corporate Power

Capitalization

Noncontravention

Brokers’ Fees

Title to Assets; Asset Sufficiency

Subsidiaries

Financial Statements

Events Subsequent to Most Recent Fiscal Year End

Legal Compliance

Tax Matters

Real Property.

Intellectual Property

Contracts

Powers of Attorney

Litigation

Employee Benefits

	 	4.17	 	Environmental, Health, and Safety Matters. Except as set forth on Section
4.17 of the Disclosure Schedule:	 

	 	 	 
	4.18

4.19

4.20

4.21

4.22

4.23

4.24

4.25

4.26

4.27

4.28

	 	Certain Business Relationships with the Target and Its Subsidiaries

Permits

Bank Accounts

Books and Records

Employees.

Names and Locations

Intentionally Omitted

Customers and Suppliers

Insurance

Closing Date

Disclaimer of other Representations and Warranties

	 	 	 
	ARTICLE 5 Pre-Closing Covenants

	 
	 	 
	5.1

5.2

5.3

5.4

5.5

5.6

5.7

5.8

5.9

5.10

5.11

	 	General

Notices and Consents

Employees; Employee Non-Compete Agreements

Intentionally Omitted

Intentionally Omitted

Intentionally Omitted

Intentionally Omitted

Intentionally Omitted

Termination of Affiliate Agreements

Termination of Guaranties

Termination of Administrative Manager’s Employment Contracts; Conversion

	 	 	 
	ARTICLE 6 Post-Closing Covenants

	 
	 	 
	6.1

6.2

6.3

6.4

6.5

6.6

6.7

6.8

6.9

6.10

6.11

6.12

6.13

6.14

6.15

6.16

6.17

6.18

	 	General; Access to Insurance

Litigation Support

Employee Benefit Matters; Compensation

Plant Closings

Investigation

Maintenance of Records

Use of Names

Non-Solicitation.

Confidentiality

Indemnification of Officers and Directors

Certain Matters

Assignment of Certain Agreements

Separation and Distribution Agreement

Insurance

Surety Bonds

Claims Administration

Insurance Premiums and Claims

Specified Premises

	 	 	 
	ARTICLE 7 Conditions to Obligation to Close

	 
	 	 
	7.1

7.2

	 	Conditions to Obligation of the Buyer

Conditions to Obligation of the Seller, the Parent and the Target

	 	 	 
	ARTICLE 8 Remedies for Breaches of This Agreement

	 
	 	 
	8.1

8.2

8.3

8.4

8.5

8.6

8.7

8.8

8.9

ARTICLE 9 Termination

9.1

9.2

	 	Survival of Representations and Warranties

Indemnification Provisions for Benefit of the Buyer

Indemnification Provisions for Benefit of the Seller

Matters Involving Third Parties

Insurance Proceeds

Exclusive Remedy

Environmental Matters

Manner of Payment

Obligations of Parent and the Seller

Termination of Agreement

Effect of Termination

	 	 	 
	ARTICLE 10 Tax Matters

10.1

10.2

10.3

10.4

10.5

10.6

10.7

10.8

	 	

Tax Sharing Agreements

Returns for Periods Through the Closing Date

Intentionally Omitted

Intentionally Omitted

Post-Closing Elections

Indemnification for Post-Closing Transactions

Section 338(h)(10) Election

Cooperation on Tax Matters

	 	 	 
	ARTICLE 11 Miscellaneous

	 
	 	 
	11.1

11.2

11.3

11.4

11.5

11.6

11.7

11.8

11.9

11.10

11.11

11.12

11.13

11.14

11.15

	 	Press Releases and Public Announcements

Third-Party Beneficiaries

Entire Agreement

Succession and Assignment

Counterparts

Specific Performance

Notices

Governing Law

Jurisdiction and Consent to Service of Process

WAIVER OF JURY TRIAL

Amendments and Waivers

Severability

Expenses

Exhibits/Schedules

Construction

EXHIBITS

	 	 	 
	Exhibit A

Exhibit B

Exhibit C

	 	-Transition Services Agreement

-Purchase Price Calculation Schedule

-Form of Legal Opinion
	 
	 	 
	SCHEDULES

	 	

	 
	 	 
	Schedule 4.1(a)

Schedule 4.1(b)

Schedule 4.5

Schedule 4.6

Schedule 4.7(a)

Schedule 4.7(b)

Schedule 4.8

Schedule 4.9

Schedule 4.10(b)

Schedule 4.11(a)

Schedule 4.11(b)

Schedule 4.12

Schedule 4.13

Schedule 4.15(a)

Schedule 4.15(b)

Schedule 4.16(a)

Schedule 4.16(a)(i)

Schedule 4.16(a)(v)

Schedule 4.17

Schedule 4.19

Schedule 4.20

Schedule 4.22

Schedule 4.22(b)

Schedule 4.23

Schedule 4.24

Schedule 4.25

Schedule 4.26

Schedule 5.5

	 	Foreign Qualifications

Directors and Officers

Title to Assets; Asset Sufficiency

Subsidiaries

Financial Statements

Undisclosed Liabilities

Events Subsequent to Most Recent Fiscal Year End

Legal Compliance

Tax Matters

Owned Real Property

Leased Real Property

Intellectual Property

Contracts

Litigation

Previous Claims

Employee Benefit Plans

Non-Compliant Plans

Change of Control Employee Benefit Plans

Environmental, Health, and Safety Matters

Permits

Bank Accounts

Employee Salaries

Employees

Names and Locations

Service Warranties

Customers and Suppliers

Insurance

Operation of Business

Schedule 6.3(b) Existing Policies Regarding Reinstatement of Employment and Vesting of

	 	 	 
	Schedule 6.3(b)(i)

Schedule 7.1(g)

Schedule 7.1(k)

Schedule 7.1(m)

	 	Benefits

Absent or Inactive Employees

Title Certificates

Third Party Approvals

Required Consents Schedule

1

STOCK PURCHASE AGREEMENT

THIS AGREEMENT (the “Agreement”) is entered into on June 30, 2006, by and among Jevic Holding
Corp., a Delaware corporation (the “Buyer”), SCS Transportation, Inc., a Delaware corporation
(“Parent”), Saia Motor Freight Line, Inc., a Louisiana corporation (the “Seller”). The Buyer, the
Parent and the Seller are referred to collectively herein as the “Parties.”

The Seller owns all of the outstanding capital stock of Jevic Transportation, Inc. (the
“Target”).

This Agreement contemplates a transaction in which the Buyer will purchase from the Seller,
and the Seller will sell to the Buyer, all of the outstanding capital stock of the Target in return
for cash.

NOW, THEREFORE, in consideration of the mutual promises herein made, and in consideration of
the representations, warranties, and covenants herein contained, the Parties agree as follows:

ARTICLE 1

Definitions

“Acquired Employee” means any active employee of the Target or any of its Subsidiaries on the
Closing Date, plus any employee of the Target or any of its Subsidiaries who is on leave of
absence, paid or unpaid, or who is otherwise absent from active employment for any other reason and
whose employer-employee relationship with the Target or such Subsidiary has not been terminated by
the Target prior to the Closing Date.

“Administrative Manger’s Agreements” has the meaning set forth in Section 5.11 below.

“Administrative Services Agreement” has the meaning set forth in Section 5.9 below.

“Adverse Consequences” means all actions, causes of action, suits, proceedings, hearings,
investigations, charges, complaints, claims, demands, injunctions, judgments, orders, decrees,
rulings, damages, dues, penalties, fines, costs, liabilities, obligations, Taxes, liens, losses,
liability, penalties, fines, expenses, and fees, whether or not arising out of third-party claims,
including court costs and reasonable attorneys’ fees and expenses and reasonable amounts paid in
investigation, defense or settlement of any of the foregoing.

“Affiliate” has the meaning set forth in Rule 12b-2 of the regulations promulgated under the
Securities Exchange Act; provided, however, that no Person shall be an Affiliate of Parent solely
by reason of such Person’s beneficial ownership of more than 10% but less than 20% of Parent’s
outstanding capital stock.

“Affiliated Group” means any affiliated group within the meaning of Code §1504(a) or any
similar group defined under a similar provision of state, local or foreign law.

“Applicable Rate” means 7%, compounded daily.

“Arbitrator” has the meaning set forth in Section 2.3(c) below.

“Buyer” has the meaning set forth in the preface above.

“Buyer Parties” has the meaning set forth in Section 8.2 below.

“Cap” has the meaning set forth in Section 8.2 below.

“Closing” has the meaning set forth in Section 2.4 below.

“Closing Balance Sheet” has the meaning set forth in Section 2.3(c) below.

“Closing Date” has the meaning set forth in Section 2.4 below.

“Closing Indebtedness” has the meaning set forth in Section 2.3(a) below.

“Closing Net Working Capital” has the meaning set forth in Section 2.3(a) below.

“Closing Seller Expenses” has the meaning set forth in Section 2.3(a) below.

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

“Company Transaction” means any (a) reorganization, liquidation, dissolution or
recapitalization, refinance of the Target or any of its Subsidiaries, (b) merger or consolidation
involving the Target or any of its Subsidiaries, (c) purchase or sale of a material portion of
Parent’s or Seller’s assets, or any portion of Target’s (or any of its Subsidiaries’) assets
outside the Ordinary Course of Business, or capital stock (or any rights to acquire, or securities
convertible into or exchangeable for, any such capital stock) of the Target or any of its
Subsidiaries (other than the purchase and sale of inventory in the Ordinary Course of Business
consistent with past custom and practice), or (d) similar transaction or business combination
involving the Target or any of its Subsidiaries or their business or material portion of Parent’s
or Seller’s assets, or any portion of Target’s (or any of its Subsidiaries’) assets outside the
Ordinary Course of Business.

“Confidentiality Agreement” means that certain Confidentiality Agreement, dated March 1, 2006
between Morgan Keegan & Company, as financial advisor to and on behalf of Parent, and Sun Capital
Partners Group IV, Inc.

“Confidential Information” means all information of a confidential or proprietary nature
(whether or not specifically labeled or identified as “confidential”), in any form or medium, that
relates to the business, products, financial condition, services or research or development of a
Person or its Subsidiaries or their respective suppliers, distributors, customers, independent
contractors or other business relations. Confidential Information includes, but is not limited to,
the following: (i) internal business and financial information of the Person or its Subsidiaries
(including information relating to strategic and staffing plans and practices, business, finances,
training, marketing, promotional and sales plans and practices, cost, rate and pricing structures
and accounting and business methods);  (ii) identities of, individual requirements of, specific
contractual arrangements with, and information about, the Person or any of its Subsidiaries’
suppliers, distributors, customers, independent contractors or other business relations and their
confidential information; (iii) trade secrets, ideas, know-how, compilations of data and analyses,
techniques, systems, formulas, compositions, research and development information, records,
reports, manuals, drawings, specifications, designs, plans, proposals, technical data,
documentation, models, data and databases relating thereto, financial and marketing plans and
customer and supplier lists and information of the Person and its Subsidiaries; (iv) inventions,
innovations, improvements, developments and methods (whether or not patentable) of the Person and
its Subsidiaries; and (v) all other intellectual property rights of the Person and its Subsidiaries
of a confidential nature.

“CRP” has the meaning set forth in Section 5.11 below.

“Deductible” has the meaning set forth in Section 8.2 below.

“De Minimis” has the meaning set forth in Section 8.2 below.

“Disclosure Schedule” means the disclosure schedule prepared by Parent and the Seller and
attached hereto containing the exceptions to the representations and warranties contained in
Article 3 and Article 4, as well as other information as indicated in other sections of this
Agreement.

“Distribution Agreement” has the meaning set forth in Section 6.13 below.

“Employee Benefit Plan” means any “employee benefit plan” (as such term is defined in ERISA
§3(3)) and any other material employee benefit plan, program or arrangement of any kind.

“Employee Pension Benefit Plan” has the meaning set forth in ERISA §3(2).

“Employee Welfare Benefit Plan” has the meaning set forth in ERISA §3(1).

“Encumbrance” means any lien, charge, security interest, claim, pledge, Tax, option, warrant,
right, contract, call, commitment, equity, demand, proxy, voting agreement, restriction on transfer
(other than restrictions on transfer under the Securities Act and applicable state securities laws)
or other encumbrance.

“Environmental, Health, and Safety Requirements” shall mean all federal, state, local and
foreign statutes, regulations, and ordinances, all judicial and administrative orders and
determinations, and all common law, concerning public health and safety, worker health and safety,
and pollution or protection of the environment, including without limitation all those relating to
the presence, use, production, generation, handling, transportation, treatment, storage, disposal,
distribution, labeling, testing, processing, discharge, release, threatened release, control, or
cleanup of any hazardous materials, substances or wastes as such requirements are enacted and in
effect on or prior to the Closing Date.

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended.

“ERISA Affiliate” means each entity which is treated as a single employer with the Target for
purposes of Code § 414 or Section 4001 of ERISA.

“Estimated Purchase Price” has the meaning set forth in Section 2.3(b) below.

“Estimated Purchase Price Certificate” has the meaning set forth in Section 7.1(m)(x)
below.

“Estoppel Certificates” has the meaning set forth in Section 7.1(j) below.

“Final Purchase Price” has the meaning set forth in Section 2.3(d) below.

“Financial Statements” has the meaning set forth in Section 4.7 below.

“GAAP” means United States generally accepted accounting principles as in effect from time to
time, consistently applied.

“Guaranty Releases” has the meaning set forth in Section 5.10 below.

“Hazardous Substance” means any pollutant, contaminant, petroleum or petroleum product,
asbestos, polychlorinated biphenyl, dangerous or toxic substance, hazardous or extremely hazardous
substance or chemical, solid or hazardous waste, special, liquid, industrial or other waste,
hazardous material, noise, mold, odor, radiation, or other material, substance or agent (whether in
solid, liquid or gaseous form) that is regulated or for which liability may be imposed pursuant to
Environmental, Health, and Safety Requirements.

“Income Tax” means any federal, state, local, or foreign income tax, including any interest,
penalty, or addition thereto, whether disputed or not.

“Income Tax Return” means any return, declaration, report, claim for refund, or information
return or statement relating to Income Taxes, including any schedule or attachment thereto, or
amendment thereof.

“Indebtedness” means, with respect to any Person at any date, without duplication: (i) all
obligations of such Person for borrowed money or in respect of loans or advances, (ii) all
obligations of such Person evidenced by bonds, debentures, notes or other similar instruments or
debt securities, (iii) all obligations in respect of letters of credit and bankers’ acceptances
issued for the account of such Person, (iv) all obligations arising from cash overdrafts, (v) all
obligations arising from deferred compensation arrangements other than the SCST Executive Capital
Accumulation Plan to the extent such plan is fully funded by Parent, (vi) all obligations of such
Person secured by a Security Interest, (vii) all guaranties of such Person in connection with any
of the foregoing, (viii) all capital lease obligations, (ix) all deferred rent, as would be
reflected on a balance sheet in accordance with GAAP, (x) all indebtedness for the deferred
purchase price of property or services with respect to which a Person is liable, contingently or
otherwise, as obligor or otherwise, (xi) all intercompany obligations of the Target or any of its
Subsidiaries to Parent, Seller or any of their respective Affiliates (other than Target or its
Subsidiaries) except for obligations to Seller for transportation services provided to Target in
the Ordinary Course of Business pursuant to that certain Interchange of Freight Agreement between
Seller and Target, dated as of November 19, 2004, as amended by that certain Addendum to Interline
Contract dated as of December 12, 2005, not in excess of $1.5 million in the aggregate, and (xii)
all accrued interest, prepayment premiums or penalties related to any of the foregoing.

“Indemnified Party” has the meaning set forth in Section 8.4(a) below.

“Indemnifying Party” has the meaning set forth in Section 8.4(a) below.

“Indemnified Taxes” means unpaid Taxes with respect to any Tax year or portion thereof ending
on or before the Closing Date (or for any Tax year beginning before and ending after the Closing
Date to the extent allocable to the portion of such period beginning before and ending on the
Closing Date) or any liability of Target or any of its Subsidiaries for the unpaid Taxes of any
Person under Treasury Reg. § 1.1502-6 (or any similar provision of state, local, or foreign law),
as a transferee or successor, by contract, or otherwise. In the case of any taxable period that
includes (but does not end on) the Closing Date (a “Straddle Period”), the amount of any Taxes
based on or measured by income or receipts of Target and its Subsidiaries for the Pre-Closing Tax
Period shall be determined based on an interim closing of the books as of the close of business on
the Closing Date (and for such purpose, the taxable period of any partnership or other pass-through
entity in which Target or any of its Subsidiaries holds a beneficial interest shall be deemed to
terminate at such time) and the amount of other Taxes of Target and its Subsidiaries for a Straddle
Period that relates to the Pre-Closing Tax Period shall 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 the Closing Date and the denominator of which is the number of days in
such Straddle Period.

“Intellectual Property” means all (a) trademarks, service marks, brand names, certification
marks, collective marks, d/b/a’s, Internet domain names, logos, symbols, trade dress, assumed
names, fictitious names, trade names, and other indicia of origin, all applications and
registrations for the foregoing, and all goodwill associated therewith and symbolized thereby,
including all renewals of same; (b) patents, registrations, invention disclosures and applications
therefore, including divisions, continuations, continuations-in-part and renewal applications, and
including renewals, extensions and reissues; (c) copyrights and all mask works, databases, computer
software, and design rights, whether or not registered or published, and all registrations and
recordations thereof and all applications in connection therewith, along with all reversions,
extensions and renewals thereof; (d) trade secrets, know-how, research and development, and
confidential information, including customer and supplier information; and (e) contracts and
licenses related to any of the foregoing.

“IRS” means the Internal Revenue Service.

“ISRA” means the New Jersey Industrial Site Recovery Act.

“Knowledge” with respect to Parent, Seller or Target means the actual knowledge of Herbert
Trucksess, James Bellinghausen, Gerald Paulson, David Gorman and John Burton (and any of their
replacements between execution of this Agreement and Closing) and the knowledge that each of the
foregoing Persons would have obtained after making reasonably inquiry (including without limitation
reasonable inquiry of Barbara Cooper, Jim Aromando, Tim Cathers, Joe Librizzi, John Bates, Ken
Adams and any of their replacements between execution of this Agreement and Closing) and reasonable
diligence with respect to the particular matter in question.

“Leased Real Property” means all leasehold or subleasehold estates and other rights to use or
occupy any land, buildings, structures, improvements, fixtures or other interest in real property
which is used in the Target’s or its Subsidiaries’ business as currently conducted.

“Leases” means all leases, subleases, licenses, concessions and other agreements, including
all amendments, extensions, renewals, guaranties and other agreements with respect thereto,
pursuant to which any of the Target or its Subsidiaries holds any Leased Real Property, including
the right to all security deposits and other amounts and instruments deposited by or on behalf of
the Target or its Subsidiaries thereunder.

“Material Adverse Effect” means any event, transaction, condition or change which has had or
would reasonably be expected to have, individually or in the aggregate, a material adverse effect
on the business, operations, assets, liabilities, operating results, value, consolidated
financial condition, or employee, customer or supplier relations of the Target and its Subsidiaries
taken as a whole, or on the ability of the Parties to consummate the transactions contemplated by
this Agreement, in each case other than any event, transaction, condition or change directly
resulting from (a) changes adversely affecting the United States economy or in the international,
national, regional or local transportation markets to the extent such changes do not
disproportionately affect the Target and its Subsidiaries as compared to the typical company
operating in such market; (b) any legislation or regulation or any order of any governmental
authority applicable to parties engaging in the transportation industry generally that imposes
restrictions, regulations or other requirements thereon to the extent such legislation, regulation
or order does not disproportionately affect the Target and its Subsidiaries as compared to the
typical company operating in the transportation market; (c) changes in economic conditions or
changes that arise from acts of war or terrorism; or (d) changes in the financial or securities
markets (including any disruption thereof and any decline in the price of any security or market
index) to the extent such changes do not disproportionately affect the Target and its Subsidiaries
as compared to the typical company operating in the transportation market.

“Material Contracts” has the meaning set forth in Section 4.13 below.

“Most Recent Balance Sheet” has the meaning set forth in Section 4.7(a) below.

“Most Recent Financial Statements” has the meaning set forth in Section 4.7(a) below.

“Most Recent Fiscal Month End” has the meaning set forth in Section 4.7(a) below.

“Multiemployer Plan” has the meaning set forth in ERISA §4001(3).

“Net Working Capital” means, as determined in accordance with GAAP and as of any date of
determination, an amount equal to (i) the total current assets of Target and its Subsidiaries on a
consolidated basis (including but not limited to cash and cash equivalents and accounts
receivable), excluding Notes Receivable – Officers, Employees (Account No. 111210), Deferred Tax
Asset (Account No. 109101) and Prepaid Insurance (Account No. 114201), minus (ii) the total
current liabilities of Target and its Subsidiaries on a consolidated basis plus Long-term
PL & PD Claim Reserve (Account No. 251101) and Long-term Worker’s Compensation Reserve (Account No.
251102) less Accrued Income Taxes – current (Total of Account No. 212101, 212102,
212103,212201,212202,212203), but excluding Indebtedness of Target or any of its Subsidiaries and
accruals with respect to any Seller Expenses otherwise included therein to the extent deducted in
Section 2.3 below. “Net Working Capital” shall also exclude (i) all assets and liabilities
related to income Taxes, determined in accordance with GAAP, and (ii) all accruals to the extent
related to the Parent, Seller and Target obligations for the termination of the Specified Lease and
the transition of Target’s business from the Specified Lease as contemplated in connection
therewith.

“Ordinary Course of Business” means the ordinary course of business consistent with past
custom and practice.

“Outside Date” has the meaning set forth in Section 9.1(b) below.

“Owned Real Property” means all land, together with all buildings, structures, improvements
and fixtures located thereon, and all recorded easements and other rights and interests appurtenant
thereto, owned by any of the Target or its Subsidiaries and used in the business of the Target and
its Subsidiaries.

“Parent” has the meaning set forth in the preface above.

“Party” has the meaning set forth in the preface above.

“PBGC” means the Pension Benefit Guaranty Corporation.

“Permits” has the meaning set forth in Section 4.19 below.

“Permitted Encumbrances” means: (a) Taxes, assessments and other governmental levies, fees or
charges which are not due and payable as of the Closing Date or which are being contested by
appropriate proceedings in a commercially reasonable manner with adequate reserves reflected on the
Most Recent Balance Sheet and the Closing Balance Sheet; (b) mechanic’s liens and similar Security
Interests for labor, materials or supplies incurred in the Ordinary Course of Business for amounts
which are not delinquent and which would not, in the aggregate, have a material and adverse effect
on the Target’s or its Subsidiary’s businesses as currently conducted which are being contested by
appropriate proceedings in a commercially reasonable manner; (c) zoning, building codes and other
land use laws regulating the use or occupancy of real estate or the activities conducted thereon
which are imposed by any governmental authority having jurisdiction over the same, all of which do
not or would not materially impair the use or value of such property in the operation of the
business of the Target and its Subsidiaries taken as a whole as currently conducted; (d) Security
Interests set forth on the Permitted Encumbrances Schedule on Section 1 hereto for
financing which is an obligation of any of the Target or its Subsidiaries which will not be paid
off at Closing; (e) purchase money Security Interests and Security Interests securing rental
payments under capital lease arrangements set forth on the Permitted Encumbrances Schedule
on Section 1 hereto; and (f) easements, covenants, conditions, restrictions and other
similar matters affecting title to any property and other title defects, all of which do not or
would not materially impair the use or value of such property in the operation of the business of
the Target and its Subsidiaries taken as a whole as currently conducted.

“Person” means an individual, a partnership, a corporation, an association, a joint stock
company, a trust, a joint venture, an unincorporated organization, or a governmental entity (or any
department, agency, or political subdivision thereof).

“Purchase Price” has the meaning set forth in Section 2.3 below.

“Purchase Price Calculation Schedule” has the meaning set forth in Section 2.2(b) below.

“Purchase Price Calculation” has the meaning set forth in Section 2.3(c) below.

“Real Property” means the Owned Real Property and the Leased Real Property.

“Restrictive Covenants” has the meaning set forth in Section 6.8(e) below.

“Scheduled Intellectual Property” has the meant set forth in Section 4.12 below.

“Section 338(h)(10) Election” has the meaning set forth in Section 10.7 below.

“Securities Act” means the Securities Act of 1933, as amended.

“Securities Exchange Act” means the Securities Exchange Act of 1934, as amended.

“Security Interest” means any mortgage, pledge, lien (statutory or otherwise), encumbrance,
charge, security interest, preference, priority, restriction, covenant, condition, restriction,
easement, encumbrance, matter of record, matter which an accurate survey would disclose, local land
use laws (including building, zoning, fire safety, subdivision and site development), or other
Encumbrance of any kind (including any conditional sale or other title retention agreement and any
lease having substantially the same effect as any of the foregoing and any assignment or deposit
arrangement in the nature of a security device).

“Seller” has the meaning set forth in the preface above.

“Seller Confidentiality Agreement” has the meaning set forth in Section 4.8(m).

“Seller Expenses” means all fees and expenses of Parent, the Seller, the Target and their
respective Affiliates (including, without limitation, fees and expenses of legal counsel,
accountants, investment bankers, brokers, finders or other representatives and consultants retained
by any of the Target and the Seller and any change of control payments or fees or transaction
related bonuses (whether absolutely or contingently dependent upon consummation of the transactions
contemplated hereby, including any such amounts payable upon any event as a result of such event
occurring after the consummation of the transactions contemplated by this Agreement) paid or
payable to any Person, with respect to this Agreement, each of the agreements contemplated hereby
and the transactions contemplated hereby and thereby, whether prior to the Closing or subsequent to
the Closing.

“Seller Parties” has the meaning set forth in Section 8.3 below.

“Specified Landlord” has the meaning set forth on the Specified Lease Schedule
attached hereto.

“Specified Lease” has the meaning set forth on the Specified Lease Schedule attached
hereto.

“Specified License” has the meaning set forth on the Specified Lease Schedule attached
hereto.

“Specified Premises” has the meaning set forth on the Specified Lease Schedule
attached hereto.

“Statement of Objections” has the meaning set forth in Section 2.3(c) below.

“Subsidiary” means any Person with respect to which a specified Person (or a Subsidiary
thereof) owns a majority of the equity securities or has the power to vote or direct the voting of
sufficient securities to elect a majority of the directors or similar governing body.

“Surveys” has the meaning set forth in Section 7.1 below.

“Target” has the meaning set forth in the preface above.

“Target Baseline Working Capital” means $11,000,000.

“Target Benefit Plans” means, collectively, the Employee Benefit Plans, the Employee Pension
Benefit Plans and the Employee Welfare Benefit Plans sponsored and maintained by Target and its
Subsidiaries and that will be retained by Target and its Subsidiaries as of the Closing Date.

“Target Share” means any share of the Common Stock, no par value, of the Target.

“Tax” means any federal, state, local, or foreign income, gross receipts, license, payroll,
employment, excise, fuel, severance, stamp, occupation, premium, windfall profits, environmental
(including taxes under Code §59A), customs duties, capital stock, franchise, profits, withholding,
social security (or similar), unemployment, disability, real property, personal property, sales,
use, transfer, registration, value added, alternative or add-on minimum, estimated, or other tax of
any kind whatsoever, including any interest, penalty, or addition thereto, whether disputed or not.

“Tax Return” means any return, declaration, report, claim for refund, or information return or
statement relating to Taxes, including any schedule or attachment thereto, and including any
amendment thereof.

“Third Party Approvals” has the meaning set forth in Section 7.1(k) below.

“Third Party Claim” has the meaning set forth in Section 8.4(a).

“Title Commitments” has the meaning set forth in Section 7.1(g) below.

“Title Company” has the meaning set forth in Section 7.1(g) below.

“Title Policies” has the meaning set forth in Section 7.1(h) below.

“Transition Services Agreement” has the meaning set forth in Section 7.1(m)(vii)
below.

“WARN Act” means the Worker Adjustment and Retraining Act of 1988, as amended, and any similar
foreign, state or local law, regulation or ordinance.

ARTICLE 2

Purchase and Sale of Target Shares

2.1 Basic Transaction. On and subject to the terms and conditions of this Agreement,
the Buyer shall purchase from the Seller, and the Seller shall sell to the Buyer, all of its
Target Shares, free and clear of all Security Interests, for the consideration specified below in
this Article 2.

2.2 Deliveries. At the Closing:

(a) Buyer shall pay to Seller an amount equal to the Estimated Purchase Price (as defined in
Section 2.3(b) below), in cash by wire transfer of immediately available funds to an
account designated by Seller at least two business days prior to the Closing Date;

(b) Seller shall deliver to Buyer the certificates representing the Target Shares, duly
endorsed in blank or accompanied by duly executed stock powers, with appropriate transfer stamps
(if any) affixed thereto;

(c) Parent and the Seller will deliver to the Buyer the various certificates, instruments, and
documents referred to in Section 7.1 below;

(d) The Buyer will deliver to the Seller the various certificates, instruments, and documents
referred to in Section 7.2 below; and

(e) Parent and the Seller shall deliver to Buyer all corporate books and records and other
property of the Target in its possession.

2.3 Purchase Price. (a) The aggregate purchase price to be paid for the Target
Shares (the “Purchase Price”) will be $42,200,000.00 minus (i) the aggregate amount of all
Indebtedness of the Target and its Subsidiaries existing as of the Closing (the “Closing
Indebtedness”), minus (ii) the amount (if any) by which the Net Working Capital of the
Target as of the Closing Date as shown on the Closing Balance Sheet (as defined in
Section 2.3(c) below and as prepared in accordance with the provisions thereof) (the
“Closing Net Working Capital”) is less than the Target Baseline Working Capital (for purposes of
clarification, such amount shall not be less than zero), and minus (iv) Seller Expenses
which are not paid by Seller at or prior to the Closing and which Target or any of its
Subsidiaries would be required to pay or otherwise satisfy or which are or would become a
liability of Target after the Closing (the “Closing Seller Expenses”).

(b) At the Closing, the Buyer shall pay to the Seller in the manner described in clause (i) of
Section 2.2(a) above an amount equal to the Purchase Price, as estimated by the Seller
(including an estimate of the components of the Purchase Price) on the Estimated Purchase Price
Certificate (as defined in Section 7.1(m)(x)), prepared in a manner consistent with the
Purchase Price Calculation Schedule set forth on the Exhibit B hereto (the “Purchase Price
Schedule”), and as accepted by the Buyer in its sole discretion (which acceptance shall be
deemed an acceptance to use such determination for purposes of Closing but shall not be construed
as an agreement with the Seller as to the actual Purchase Price or any components thereof) not less
than two days prior to the Closing (the “Estimated Purchase Price”).

(c) Within 90 days following the Closing Date, the Buyer shall deliver to the Seller a balance
sheet of the Target (in its final and binding form, the “Closing Balance Sheet”), setting forth the
Closing Indebtedness, the Closing Seller Expenses, and the Closing Net Working Capital and a
certificate setting forth the resulting Purchase Price calculated with reference to such amounts
(in its final and binding form, together with the Closing Balance Sheet, the “Purchase Price
Calculation”). The Closing Balance Sheet shall include all known adjustments required in a
year-end closing of the books (except as set forth on Schedule 2.3 hereto) and shall be prepared in
a manner consistent with the Purchase Price Calculation Schedule based upon a balance sheet of the
Target prepared in accordance with GAAP. The Seller shall cooperate as reasonably requested in
connection with the preparation of the Purchase Price Calculation. During the 30-day period
immediately following the Seller’s receipt of the Purchase Price Calculation, the Seller and its
agents shall be permitted to review the Target’s books and records and the Target’s working papers
related to the preparation of the Purchase Price Calculation and determination of the Purchase
Price. The Purchase Price Calculation shall become final and binding upon the parties 30 days
following the Seller’s receipt thereof unless the Seller gives written notice of its disagreement
(a “Statement of Objections”) to the Buyer prior to such date. Any Statement of Objections shall
specify in reasonable detail the nature and dollar amount of any disagreement so asserted and shall
be delivered only if (and to the extent that) the Seller reasonably and in good faith determines
that the Purchase Price Calculation and the resulting Purchase Price calculated with reference
thereto delivered by the Buyer has not been determined in accordance with the guidelines and
procedures set forth in this Agreement. If a timely Statement of Objections is received by the
Buyer, then the Purchase Price Calculation (as revised in accordance with clause (x) or (y) below)
shall become final and binding upon the parties on the earliest of (x) the date the parties resolve
in writing any differences they have with respect to the matters specified in the Statement of
Objections or (y) the date all matters in dispute are finally resolved in writing by the Arbitrator
(defined below). During the 30 days following delivery of a Statement of Objections, the parties
shall seek in good faith to resolve in writing any differences which they have with respect to the
matters specified in the Statement of Objections. Following delivery of a Statement of Objections,
the Buyer and its agents and representatives shall be permitted to review the Seller’s and its
representatives’ working papers relating to the preparation of the Statement of Objections. At the
end of the 30-day period referred to above, the parties shall submit to a mutually satisfactory
independent reputable consulting firm or a mutually satisfactory independent reputable “big-four”
accounting firm (other than KPMG LLP) for review and resolution of all matters (but only such
matters) that remain in dispute and that were properly included in the Statement of Objections. If
the parties are unable to mutually agree upon a consulting firm or an accounting firm, Buyer and
Seller shall select by lot a reputable accounting or consulting firm. The parties shall instruct
the consulting firm or accounting firm ultimately agreed upon or selected by lot under this
Section 2.3(c) (the “Arbitrator”) to make a final determination of the Closing
Indebtedness, the Closing Net Working Capital, the Closing Seller Expenses and the resulting
Purchase Price calculated with reference to such amounts to the extent such amounts are in dispute,
in accordance with the guidelines and procedures set forth in this Agreement. The parties will
cooperate with the Arbitrator during the term of its engagement. The parties shall instruct the
Arbitrator to not assign a value to any item in dispute greater than the greatest value for such
item assigned by the Buyer, on the one hand, or the Seller, on the other hand, or less than the
smallest value for such item assigned by the Buyer, on the one hand, or the Seller, on the other
hand. The parties shall also instruct the Arbitrator to make its determination based solely on
presentations by the Buyer and the Seller which are in accordance with the guidelines and
procedures set forth in this Agreement (i.e., not on the basis of an independent review). The
Purchase Price Calculation and the determination of the Closing Indebtedness, the Closing Net
Working Capital, the Closing Seller Expenses and the resulting Purchase Price calculated with
reference thereto shall become final and binding on the Parties on the date the Arbitrator delivers
its final resolution in writing to the parties (which final resolution shall be requested by the
Parties to be delivered not more than 45 days following submission of such disputed matters). The
fees and expenses of the Arbitrator shall be borne by the Parties based upon the relative merits of
their claims as determined by the Arbitrator.

(d) Promptly after the Purchase Price Calculation and the determination of Closing
Indebtedness, the Closing Net Working Capital, the Closing Seller Expenses and the resulting
Purchase Price calculated with reference to such amounts become final and binding on the parties
under Section 2.3(c) above, the Estimated Purchase Price shall be recalculated by giving
effect to the final and binding Closing Indebtedness, Closing Net Working Capital and Closing
Seller Expenses (as recalculated, the “Final Purchase Price”). If the Estimated Purchase Price is
greater than the Final Purchase Price, Parent and Seller shall, on a joint and several basis, and
if the Final Purchase Price is greater than the Estimated Purchase Price, Buyer shall, within three
business days after the Purchase Price Calculation becomes final and binding on the parties, make
payment by wire transfer to Buyer or the Seller, as the case may be, in immediately available funds
of the amount of such difference, together with interest thereon at a rate per annum equal to the
Applicable Rate, calculated on the basis of the actual number of days elapsed over 360, from the
Closing Date to the date of payment.

2.4 The Closing. The closing of the transactions contemplated by this Agreement (the
“Closing”) shall take place at the offices of Kirkland & Ellis LLP, 200 East Randolph Drive,
Chicago, 60601, commencing at 10:00 a.m. local time on June 30, 2006 (the “Closing Date”).

2.5 Allocation of Purchase Price. Buyer, Target and Seller agree that the Purchase
Price and the liabilities of Target (plus other relevant items) will be allocated to the assets of
the Target for all purposes (including Tax and financial accounting purposes) (other than for
purposes of title insurance and casualty insurance) in a manner consistent with Section 338 and
Section 1060 of the Code and Treasury Regulations thereunder in the respective amounts determined
by Buyer subject only to Seller’s consent to such allocation, which consent shall not be
unreasonably withheld or delayed. Buyer, Target and Seller shall timely file all Tax Returns
(including amended returns and claims for refund) and information reports in a manner consistent
with such allocation.

ARTICLE 3

Representations and Warranties Concerning the Transaction

3.1 Representations and Warranties of the Seller. As a material inducement to the
Buyer to enter into this Agreement and consummate the transactions contemplated hereby, Each of
Parent and the Seller, jointly and severally, represents and warrants to the Buyer as follows with
respect to Parent and the Seller:

(a) Organization of Parent and Seller. The Seller is a corporation, duly organized,
validly existing, and in good standing under the laws of the State of Louisiana. Parent is a
corporation, duly organized, validly existing, and in good standing under the laws of the State of
Delaware.

(b) Authorization of Transaction. Each of the Seller and Parent has full corporate
power and corporate authority to execute and deliver this Agreement and to perform Seller’s
obligations hereunder. The execution, delivery and performance of this Agreement and all of the
other agreements and instruments contemplated hereby to which the Seller or Parent is a party have
been duly authorized by the Seller or Parent, as applicable, and no other corporate act or other
proceeding on the part of the Parent or Seller or either of their boards of directors is necessary
to authorize the execution, delivery or performance of this Agreement or the other agreements
contemplated hereby and the consummation of the transactions contemplated hereby or thereby. This
Agreement has been duly executed by each of the Seller and Parent and constitutes the valid and
legally binding obligation of each, enforceable in accordance with its terms and conditions, and
each of the other agreements and instruments contemplated hereby to which the Seller or Parent is a
party, when executed and delivered by Parent or the Seller, as applicable, in accordance with the
terms hereof and thereof, shall each constitute a valid and binding obligation of such Person,
enforceable in accordance with its respective terms, in each case subject to the effect of any
applicable bankruptcy, reorganization, insolvency, moratorium or similar laws affecting creditors’
rights generally and subject, as to enforceability, to the effect of general principles of equity
(regardless of whether such enforceability is considered in a proceeding in equity or at law). The
Seller and Parent need not give any notice to, make any filing with, or obtain any authorization,
consent, or approval of any government or governmental agency in order to consummate the
transactions contemplated by this Agreement. None of the Seller, Parent or any of their respective
Subsidiaries is a party to or bound by any written or oral agreement or understanding with respect
to a Company Transaction other than this Agreement, and each such Person has terminated all
discussions with third parties (other than with Buyer and its Affiliates) regarding Company
Transactions.

(c) Noncontravention. Neither the execution and the delivery of this Agreement and
all of the other agreements and instruments executed pursuant hereto to which Parent or the Seller
is a party, nor the consummation of the transactions contemplated hereby or thereby, will (i)
violate any provision of either Seller’s or Parent’s charter or bylaws, (ii) violate any
constitution, statute, regulation, rule, injunction, judgment, order, decree, ruling, charge, or
other restriction of any government, governmental agency, or court to which Seller or Parent is
subject, (iii) conflict with, result in a breach of, constitute a default under, result in the
acceleration of, result in the creation of a Security Interest in or upon any of the Target’s or
any of its Subsidiaries capital stock pursuant to, create in any party the right to accelerate,
terminate, modify, or cancel under, require any authorization, consent, approval, exemption or
other action of or by or notice or declaration to, or filing with, any third party or any court or
administrative or governmental body or agency pursuant to, any agreement, contract, lease, license,
instrument, or other arrangement to which Parent or the Seller is a party or to which any of its
assets is subject.

(d) Brokers’ Fees. None of Seller, Parent or any of their respective Affiliates have
any liability or obligation to pay any fees or commissions to any broker, finder, or agent with
respect to the transactions contemplated by this Agreement for which the Buyer or could become
liable or obligated.

(e) Target Shares. The Seller holds of record and owns beneficially all the Target
Shares, free and clear of any restrictions on transfer (other than restrictions under the
Securities Act and state securities laws) or Security Interests (other than Permitted
Encumbrances). At the Closing, Seller shall sell to Buyer good title to the Target Shares, free
and clear of all Security Interests. Neither Seller nor Parent is bound by any option, warrant,
purchase right, or other contract or commitment that could require Seller or Parent to sell,
transfer, or otherwise dispose of any Target Shares (other than this Agreement). Neither Seller
nor Parent is a party to any voting trust, proxy, or other agreement or understanding with respect
to the voting of any Target Shares. Assuming the accuracy of Buyers representations in Section
3.2(e), the sale of the Target Shares to Buyer shall be made in compliance with all federal and
state securities laws.

3.2 Representations and Warranties of the Buyer. The Buyer represents and warrants
to the Seller as follows:

(a) Organization of the Buyer. The Buyer is a Delaware corporation duly organized,
validly existing, and in good standing under the laws of the jurisdiction of its organization.

(b) Authorization of Transaction. The Buyer has full power and authority (including
full company power and authority) to execute and deliver this Agreement and to perform its
obligations hereunder. This Agreement constitutes the valid and legally binding obligation of the
Buyer, enforceable in accordance with its terms and conditions, and each of the other agreements
and instruments contemplated hereby to which Buyer is a party, when executed and delivered by Buyer
in accordance with the terms hereof, shall each constitute a valid and binding obligation of Buyer,
enforceable in accordance with its respective terms and conditions, in each case subject to the
effect of any applicable bankruptcy, reorganization, insolvency, moratorium or similar laws
affecting creditors’ rights generally and subject, as to enforceability, to the effect of general
principles of equity (regardless of whether such enforceability is considered in a proceeding in
equity or at law). Assuming the accuracy of Parent’s and Seller’s representations and warranties
in this Agreement (to the extent the breach of any such representation or warranty or any facts,
circumstances or events related to such representation or warranty would cause Buyer’s
representations in this sentence to be incorrect or misleading), the Buyer need not give any notice
to, make any filing with, or obtain any authorization, consent, or approval of any government or
governmental agency in order to consummate the transactions contemplated by this Agreement other
than such authorizations, consents or approvals either (i) required due to the identity of parent,
Seller, Target or its Subsidiaries or (ii) based on the industry or market of any of Parent,
Seller, Target or its Subsidiaries which would have been required for any other Person (other than
Buyer or any of its Affiliates) to acquire the Target Shares.

(c) Noncontravention. Neither the execution and the delivery of this Agreement and
all of the other agreements and instruments contemplated hereby to which the Buyer is a party, nor
the consummation of the transactions contemplated hereby or thereby, will (i) violate any provision
of the Buyer’s charter or bylaws, (ii) violate any constitution, statute, regulation, rule,
injunction, judgment, order, decree, ruling, charge, or other restriction of any government,
governmental agency, or court to which the Buyer is subject, (iii) conflict with, result in a
breach of, constitute a default under, result in the acceleration of, create in any party the right
to accelerate, terminate, modify, or cancel, or require any notice under, any agreement, contract,
lease, license, instrument, or other arrangement to which the Buyer is a party or to which any of
its assets is subject, in each case to the extent any such violation, conflict or breach would
materially and adversely affect Buyer’s ability to consummate the transactions contemplated in this
Agreement.

(d) Brokers’ Fees. Neither Buyer nor any of its Affiliates has any liability or
obligation to pay any fees or commissions to any broker, finder, or agent with respect to the
transactions contemplated by this Agreement for which the Seller could become liable or obligated.

(e) Investment. Buyer is acquiring the Target Shares for its own account for
investment purposes and without any view to the sale or distribution thereof in contravention of
securities laws. Buyer understands that sale of the Target Shares has not been registered under
the Securities Act and therefore the Target Shares cannot be resold unless registered thereunder or
unless an exemption from such registration is available.

(f) Financing. At Closing, Buyer will have all funds necessary to consummate the
transactions contemplated by this Agreement. The ability of Buyer to consummate the transactions
contemplated by this Agreement is not subject to any condition or contingency with respect to
financing.

ARTICLE 4

Representations and Warranties Concerning the Target and Its Subsidiaries

Parent and Seller, on a joint and several basis, represent and warrant to the Buyer as
follows:

4.1 Organization, Qualification, and Corporate Power. Each of the Target and its
Subsidiaries is a corporation or limited liability company duly organized, validly existing, and
in good standing under the laws of the jurisdiction of its incorporation or organization. Each of
the Target and its Subsidiaries is duly authorized to conduct business and is in good standing
under the laws of each jurisdiction where such qualification is required, except where the lack of
such qualification would not have a Material Adverse Effect. Section 4.1(a) of the
Disclosure Schedule lists the jurisdictions where each of the Target and its Subsidiaries is
qualified to do business. Each of the Target and its Subsidiaries has full corporate power and
authority and all licenses, permits and authorizations to carry on the businesses in which it is
engaged as now conducted and as presently proposed to be conduced by the Seller and its
Affiliates, to own and use the properties owned and used by it and to carry out the transactions
contemplated by this Agreement. Copies of each of the Target’s and its Subsidiaries’ articles of
incorporation and by-laws or similar governance documents which have been furnished to Buyer’s
counsel reflect all amendments made thereto at any time prior to the date of this Agreement and
are correct and complete. None of Target or any of its Subsidiaries are in default under or in
violation of any provision of their articles of incorporation or by-laws or any similar governance
documents. Section 4.1(b) of the Disclosure Schedule lists the directors and officers of
each of the Target and its Subsidiaries.

4.2 Capitalization. The entire authorized capital stock of the Target consists of
100 shares of common stock all of which are issued and outstanding. All of the issued and
outstanding Target Shares have been duly authorized, are validly issued, fully paid, and
nonassessable and are not subject to, nor were they issued in violation of, any preemptive rights
or rights of first refusal, and are held of record by the Seller. There are no outstanding or
authorized options, warrants, purchase rights, subscription rights, conversion rights, exchange
rights, or other contracts or commitments that could require the Target or any of its Subsidiaries
to issue, sell, or otherwise cause to become outstanding any capital stock of Target or any of its
Subsidiaries. There are no outstanding or authorized stock appreciation, phantom stock, profit
participation, or similar rights with respect to the Target or any of its Subsidiaries. None of
Target or any of its Subsidiaries are subject to any option or obligation (contingent or
otherwise) to repurchase or otherwise acquire or retire any shares of capital stock of Target or
any of its Subsidiaries or any warrants, options or other rights to acquire any such capital
stock. There are no agreements with respect to the voting or transfer of Target’s capital stock
(other than this Agreement) or any capital stock of any of Target’s Subsidiaries.

4.3 Noncontravention. Neither the execution and the delivery of this Agreement, nor
the consummation of the transactions contemplated hereby, will (i) violate any provision of
Target’s or any of its Subsidiaries’ charter or bylaws, (ii) violate any constitution, statute,
regulation, rule, injunction, judgment, order, decree, ruling, charge, or other restriction of any
government, governmental agency, or court to which the Target or any of its Subsidiaries is
subject, (iii) conflict with, result in a breach of, constitute a default under, result in the
acceleration of, result in the creation of a Security Interest in or upon any of the Target’s or
any of its Subsidiaries assets pursuant to, create in any party the right to accelerate,
terminate, modify, or cancel under, require any authorization, consent, approval, exemption or
other action of or by or notice or declaration to, or filing with, any third party or any court or
administrative or governmental body or agency pursuant to, any agreement, contract, Lease,
license, instrument, or other arrangement to which Target or any of its Subsidiaries is a party or
to which any of their assets are subject except, in the cases of clauses (ii) and (iii) above,
such events as would not be material to the Target or any of its Subsidiaries. None of the Target
and its Subsidiaries needs to give any notice to, make any filing with, or obtain any
authorization, consent, or approval of any government or governmental agency in order for the
Parties to consummate the transactions contemplated by this Agreement. Neither Target or any of
its Subsidiaries is a party to or bound by any written or oral agreement or understanding with
respect to a Company Transaction other than this Agreement, and each such Person has terminated
all discussions with third parties (other than with Buyer and its Affiliates) regarding Company
Transactions.

4.4 Brokers’ Fees. None of the Target and its Subsidiaries and Affiliates has any
liability or obligation to pay any fees or commissions to any broker, finder, or agent with
respect to the transactions contemplated by this Agreement.

4.5 Title to Assets; Asset Sufficiency. The Target and its Subsidiaries have good and
valid title to the Owned Property and other assets used in the conduct of their businesses as
currently conducted free of all Security Interests other than Permitted Encumbrances (other than
assets leased by Target or any of its Subsidiaries). The Target and its Subsidiaries have a valid
leasehold interest in the Leases and all other assets used in the conduct of their businesses as
currently conducted which are not owned by Target or any of its Subsidiaries, free of all Security
Interests other than Permitted Encumbrances. The assets presently owned, leased or licensed by
the Target and its Subsidiaries include all assets that are necessary to permit the Target and its
Subsidiaries to conduct their business in the same manner as their business is currently
conducted. Except as set forth on Section 4.5(a) of the Disclosure Schedule, all of
Target’s and its Subsidiaries’ buildings (including all components of such buildings, structures
and other improvements), equipment, machinery, fixtures, improvements and other tangible assets
(whether owned or leased) are in good condition and repair (except for ordinary wear and tear in
the Ordinary Course of Business in a manner consistent with industry standards and except as
specifically impaired on the Most Recent Balance Sheet) and are fit for use in the ordinary course
of Target’s and such Subsidiaries’ business as presently conducted and as presently proposed to be
conducted by the Seller and Parent. Section 4.5(b) of the Disclosure Schedule sets forth a
list of all vehicles owned or leased by Target or any of its Subsidiaries (including trucks,
trailers and forklifts) and identifies whether such vehicles are leased or owned by Target or one
of its Subsidiaries.

4.6 Subsidiaries. Section 4.6 of the Disclosure Schedule sets forth for each
Subsidiary of the Target: (a) its name and jurisdiction of organization, (b) the names and
respective ownership interests of the holders thereof, and (c) the amount and type of authorized
and outstanding equity of such Subsidiary. All of the issued and outstanding ownership interests
of each Subsidiary of the Target have been duly authorized and are validly issued, fully paid, and
nonassessable, and are not subject to, nor were they issued in violation of, any preemptive rights
or rights of first refusal. Each ownership interest of each of the Target’s Subsidiaries is owned
beneficially and of record by the Person indicated on Section 4.6 of the Disclosure
Schedule, free and clear of any Security Interest except Permitted Encumbrances. Neither the
Target nor any of its Subsidiaries owns or holds the right to, or has any obligation to, purchase
or otherwise acquire any shares of stock or any other security or interest in any other Person or
has any obligation to make any capital contribution to any Person. Prior to the Closing, the
Subsidiary of Target shall be converted into a limited liability company.

4.7 Financial Statements.

(a) Section 4.7(a) of the Disclosure Schedule contains a correct and complete copy of
the following financial statements (collectively the “Financial Statements”): (i) unaudited
consolidated balance sheets and statements of income, changes in stockholder’s equity, and cash
flow as of and for the fiscal years ended December 31, 2005, December 31, 2004 and December 31,
2003 for the Target and its Subsidiaries; and (ii) unaudited consolidated balance sheet and
statement of income, changes in stockholders’ equity, and cash flow (the “Most Recent Financial
Statements”) as of and for the 5 months ended May 31, 2006 (the “Most Recent Fiscal Month End”) for
the Target and its Subsidiaries. The Financial Statements have been prepared in accordance with
GAAP applied on a consistent basis throughout the periods covered thereby and present fairly in all
material respects the financial condition of the Target and its Subsidiaries as of such dates and
the results of operations of the Target and its Subsidiaries for such periods; provided, however,
that the Most Recent Financial Statements are subject to normal year-end adjustments and lack
footnotes (none of which adjustments or footnotes, however, would, alone or in the aggregate, be
materially adverse to the business, operations, assets, liabilities, financial condition, operating
results, cash flow or net worth of Target and its Subsidiaries taken as a whole).

(b) Except for obligations and liabilities (i) set forth on Section 4.7(b) of the
Disclosure Schedule, (ii) set forth or reserved for on the balance sheet included in the Most
Recent Financial Statements (the “Most Recent Balance Sheet”), (iii) for cargo damage and
destruction, personal injury, property damage, group health care or workers compensation if such
liabilities would be the types of liabilities are incurred in the Ordinary Course of Business and
are of the types of liabilities included under existing reserves included on the Most Recent
Balance Sheet, and (iv) incurred in the Ordinary Course of Business since the Most Recent Fiscal
Month End (none of which is a liability for breach of contract, breach of warranty, tort,
infringement, violation of law, claim or lawsuit), neither Target nor any of its Subsidiaries has
or will have any material obligation or liability (whether accrued, absolute, contingent,
unliquidated or otherwise, whether or not known to Target or any of its Subsidiaries, whether due
or to become due and regardless of when or by whom asserted) arising out of any transaction entered
at or prior to the date hereof, or any action or inaction at or prior to the date hereof.

(c) At the Closing, the aggregate net book value of Target’s property, plant and equipment, as
determined in accordance with GAAP on a basis consistent with past practice will not be less than
$94,600,000.00.

4.8 Events Subsequent to Most Recent Fiscal Year End. Since December 31, 2005, there
has not been any Material Adverse Effect or any fact, circumstance or event which would reasonably
be expected to have a Material Adverse Effect and, except as set forth on Section 4.8 of
the Disclosure Schedule, with respect to each of the Target and its Subsidiaries, there has not
been any:

(a) amendment to its organizational documents;

(b) damage or destruction (whether or not covered by insurance) to any of its Leases, Owned
Real Property, or other material assets in which the Adverse Consequences with respect to the
damage or destruction of such material assets exceed $50,000 individually;

(c) entry into or materially amend any employment, severance, benefit, change of control,
consulting, independent contractor (other than independent contractors for transportation services)
or any similar arrangement that is not terminable at will without severance, penalty or payment of
any other amount in connection with such termination or any transfer of employees from the Target
or any of its Subsidiaries to Parent or any of its Subsidiaries (other than the Target or any of
its Subsidiaries) or any transfer of employees from Parent or any of its Subsidiaries (other than
the Target or any of its Subsidiaries) to the Target or any of its Subsidiaries;

(d) any payment, nor declaration or setting aside of funds for any payment or distribution of
cash (including so-called “tax distributions”) other than dividends of cash and repayments of cash
of intercompany debt to Parent or Seller in the Ordinary Course of Business in an aggregate amount
not in excess of $250,000, or other property to any of its stockholders with respect to such
stockholder’s capital stock or otherwise, or purchase, redemption or other acquisition of any
shares of its capital stock or other equity securities (including any warrants, options or other
rights to acquire its capital stock or other equity);

(e) change (whether or not in the Ordinary Course of Business) in any method of accounting or
accounting policies;

(f) acceleration or delay in the collection of accounts receivable, the payment of accounts
payable or commissions or any other liability, or obligation or agreement or negotiations with any
party to extend the payment date of any accounts payable or commissions or any other liability or
obligation, or any acceleration of the collection of (or discount of) any accounts or notes
receivable;

(g) capital expenditure or group of related capital expenditures which exceeded the Target’s
current budget or commitment with respect to such capital expenditure or group of related capital
expenditures in excess of $75,000 individually;

(h) sale, assignment, transfer, lease, license or other encumbrance on any of its tangible
assets, or cancellation of any material debts or claims other than the sale or disposal of assets
in the Ordinary Course of Business with an aggregate value of less than $150,000;

(i) entry into any settlement, conciliation or similar agreement other than such agreements
providing for solely monetary settlements which do not exceed $150,000;

(j) bonus or any wage or salary increase to any employee or group of employees (except as
required by pre-existing contracts or bonus plans for hourly and salaried employees, in each case
that are described in Section 4.13 of the Disclosure Schedule, or with respect to employees
with an annual compensation not in excess of $85,000), or entering into, amendment or termination
of any collective bargaining agreement or other employment agreement;

(k) plant closing or other layoff of employees that have triggered any obligation under the
Worker Adjustment and Retraining Notification Act, as amended, or any similar foreign, state,
provincial or local law, regulation or ordinance (jointly, the “WARN Act”);

(l) mortgages or pledges of any of its properties or assets or attachment of any Security
Interest thereon, except for Permitted Encumbrances;

(m) (i) sale, assignment, transfer, lease, license or other encumbrance on any of its
Intellectual Property, (ii) disclosure of any Confidential Information to any Person (other than to
Buyer and its Affiliates and advisors or to other potential purchasers of Parent, Seller or Target
which have entered into confidentiality agreements with the Target, Parent or Seller with respect
to such disclosure (any such agreement entered into with Parent or Seller, a “Seller
Confidentiality Agreement”), and other than in the Ordinary Course of Business in circumstances
in which it has imposed reasonable confidentiality restrictions), or (iii) abandonment or lapse of
any material Intellectual Property rights;

(n) waiver of any rights of material value (whether or not in the Ordinary Course of
Business);

(o) loans or advances to, guaranties for the benefit of, any Person (other than advances to
Target’s or its Subsidiaries’ employees in the Ordinary Course of Business);

(p) charitable contributions or pledges exceeding in the aggregate $25,000 or any political
contributions;

(q) purchase or other acquisition of any notes, obligations, securities, capital stock or
ownership interest in any Person or any steps taken to incorporate any Subsidiary;

(r) action or failure to take any action that has, had or could reasonably be expected to have
the effect of accelerating to pre-Closing periods sales to customers or other revenues that could
otherwise be expected to take place or be incurred after the Closing;

(s) entry into, amendment or termination of any contract other than in the Ordinary Course of
Business; or

(t) agreement, whether orally or in writing, to do or bring about any of the foregoing.

4.9 Legal Compliance. Except as set forth on Section 4.9 of the Disclosure
Schedule, each of the Target and its Subsidiaries (and, to the extent affecting the Target or any
of its Subsidiaries, each of Parent, Seller and their respective Subsidiaries) is, and for the
past three years has been, in material compliance with all applicable laws (including rules,
regulations, codes, plans, injunctions, judgments, orders, decrees, rulings, and charges
thereunder) of federal, state, local, and foreign governments (and all agencies thereof). During
the past three (3) years, no material notices have been received by and no material claims have
been filed against Target or any of its Subsidiaries alleging a violation of any such laws,
ordinances, codes, rules, requirements or regulations. None of Parent, Seller, Target nor any of
their respective Subsidiaries has made any bribes, kickback payments or other similar payments of
cash or other consideration, including payments to customers or clients or employees of customers
or clients for purposes of doing business with such Persons.

4.10 Tax Matters.

(a) Each of Target and its Subsidiaries has timely filed all Income Tax Returns and all other
material Tax Returns that it was required to file. All such Tax Returns were correct and complete
in all material respects. All material Taxes owed by any of Target and its Subsidiaries (whether
or not shown or required to be shown on any Tax Return) have been paid. Neither Target nor any of
its Subsidiaries currently is the beneficiary of any extension of time within which to file any
Tax Return. No claim has ever been made by an authority in a jurisdiction where Target or any of
its Subsidiaries does not file Tax Returns that it is or may be subject to taxation by that
jurisdiction, other than have been settled and listed on Section 4.10 of the Disclosure
Schedule. There are no liens on any of the assets of Target or any of its Subsidiaries that arose
in connection with any failure (or alleged failure) to pay any Tax. Each of Target and its
Subsidiaries has withheld and paid all material Taxes required to have been withheld and paid in
connection with amounts paid or owing to any employee, independent contractor, creditor,
stockholder, or other third party, and all Forms W-2 and 1099 required with respect thereto have
been properly completed and timely filed.

(b) Section 4.10(b) of the Disclosure Schedule lists all federal, state, local, and
foreign Tax Returns filed with respect to any of the Target and its Subsidiaries for taxable
periods ended on or after December 31, 2003, indicates those Tax Returns that have been audited,
and indicates those Tax Returns that currently are the subject of audit. Parent and the Seller
have provided access to the Buyer correct and complete copies of all federal Tax Returns,
examination reports, and statements of deficiencies assessed against or agreed to by any of the
Target and its Subsidiaries since December 31, 2003. There is no material dispute or claim
concerning any Tax liability of Target or its Subsidiaries either (A) claimed or raised by any
authority in writing or (B) as to which Target or its Subsidiaries has Knowledge.

(c) None of the Target and its Subsidiaries has waived any statute of limitations in respect
of Income Taxes or agreed to any extension of time with respect to a Tax assessment or deficiency,
except as listed on Section 4.10(c) of the Disclosure Schedule.

(d) None of the Target and its Subsidiaries is a party to any Tax allocation,
indemnification, or sharing agreement, other than that certain Tax Sharing Agreement, dated as of
September 30, 2002, among Yellow Corporation and Parent and its Subsidiaries.

(e) Neither Target nor its Subsidiaries has made any payments, is obligated to make any
payments, or is a party to any agreement, including with respect to this transaction, that could
obligate it to make any payments that will not be deductible under Code §280G.

(f) Neither Target nor any of its Subsidiaries has been a member of an Affiliated Group
filing a consolidated federal Income Tax Return other than a group the common parent of which is
Parent. Parent has filed a consolidated federal Income Tax Return with Target and its Subsidiaries
for the taxable year immediately preceding the current taxable year and will be eligible to make
the Section 338(h)(10) Election.

(g) Each Affiliated Group has timely filed all Tax Returns that it was required to file for
each taxable period during which any of the Target and its Subsidiaries was a member of the group,
all such Tax Returns were correct and complete in all material respects, and all material Taxes
owed by such Affiliated Group (whether or not shown or required to be shown on any Tax Return)
have been paid.

(h) None of the Target and its Subsidiaries has Knowledge of any liability for Taxes of any
Person other than the Target and its Subsidiaries under Reg. § 1.1502-6 (or any similar provision
of state, local or foreign law), as a transferee or successor, by contract or otherwise.

(i) There is no dispute or claim concerning any Income Tax liability of any SCST Affiliated
Group for any taxable period during which Target or any of its Subsidiaries was a member of the
group either (A) claimed or raised by any authority in writing or (B) as to which Parent or Seller
and the directors and officers (and employees responsible for Tax matters) of any of Parent and
its Subsidiaries has Knowledge based upon personal contact with any agent of such authority. No
SCST Affiliated Group has waived any statute of limitations in respect of any Taxes or agreed to
any extension of time with respect to a Tax assessment or deficiency for any taxable period during
which any of Target and its Subsidiaries was a member of the group.

(j) None of the Target nor any of Target’s Subsidiaries, or Seller or Parent has engaged in a
“listed transaction” as defined in Treasury Regulation § 1.6011-4(b)(2).

(k) To the extent that Target or any of its Subsidiaries has in place any “nonqualified
deferred compensation plan” within the meaning of Section 409A of the Code, such plan has been
operated in good faith compliance with Section 409A of the Code at all times.

4.11 Real Property.

(a) Section 4.11(a) of the Disclosure Schedule sets forth the address and description
of each parcel of Owned Real Property. With respect to each parcel of Owned Real Property:

(i) the Target or one of its Subsidiaries has marketable fee simple title, free and
clear of all Security Interests, except Permitted Encumbrances and items listed on the Title
Commitments;

(ii) none of the Target or its Subsidiaries has leased, is subject to, or otherwise
granted to any Person the right to use or occupy such Owned Real Property or any portion
thereof;

(iii) there are no outstanding options, rights of first offer or rights of first
refusal to purchase such Owned Real Property or any portion thereof or interest therein;

(iv) To the Knowledge of the Target or any of its Subsidiaries, neither Target or any
of its Subsidiaries has received written notice from insurers of the Owned Real Property
relating to any material violations, deficiencies or need for repairs;

(v) To the Knowledge of the Target or any of its Subsidiaries, no fact or condition
exists which would result in the termination of the current access from any property
comprising part of the Owned Real Property to any presently existing public highways and
roads adjoining or situated on the Owned Real Property;

(vi) To the Knowledge of the Target or any of its Subsidiaries, except as set forth in
Section 4.11(a)(vi) of the Disclosure Schedule and except as shown on the existing
surveys previously provided to Buyer, neither Target or any of its Subsidiaries has received
notice from any third party with respect to any encroachments or other facts or conditions
affecting any of the Owned Real Property, which would interfere in any respect with the use,
occupancy or operation thereof as currently used, occupied and operated in any material
manner; and

(vii) Except as set forth in Section 4.11(a)(ix) of the Disclosure Schedule,
neither Target nor any of its Subsidiaries has received written notice that any
condemnation proceedings or similar actions or proceedings are now pending or threatened
with respect to the Owned Real Property or any part thereof.

(b) Section 4.11(b) of the Disclosure Schedule sets forth the address of each parcel
of Leased Real Property, and a true and complete list of all Leases for each such parcel of Leased
Real Property. The Seller has delivered to the Buyer a true and complete copy of each such Lease
document, and in the case of any oral Lease, a written summary of the material terms of such Lease.
Except as set forth in Section 4.11(b) of the Disclosure Schedule, with respect to each of
the Leases:

(i) None of Target’s or its Subsidiaries’ possession and quiet enjoyment of the Leased
Real Property under such Lease has been disturbed, to Seller’s Knowledge, no third party has
any right to disturb the Lease, and there are no disputes with respect to such Lease;

(ii) no security deposit or portion thereof deposited with respect to such Lease has
been applied in respect of a breach or default under such Lease which has not been
redeposited in full;

(iii) the other party to such Lease is not an Affiliate of, and otherwise does not have
any economic interest in, any of Target or its Subsidiaries;

(iv) none of Target or its Subsidiaries has collaterally assigned or granted any other
security interest in such Lease or any interest therein;

(v) there are no liens or options on the estate or interest created by such Lease
except as set forth on Section 4.11(b)(v) of the Disclosure Schedule;

(vi) each of the Leases is in full force and effect, and has not been amended,
modified, or supplemented, except as set forth on Section 4.11(b)(vi) of the
Disclosure Schedule;

(vii) To the Knowledge of the Target or any of its Subsidiaries, except as set forth in
Section 4.11(b)(vii) of the Disclosure Schedule, neither Target or any of its
Subsidiaries has received notice from any third party with respect to any encroachments or
other facts or conditions affecting any of the Leased Real Property which would interfere in
any respect with the use, occupancy or operation thereof as currently used, occupied and
operated in any material manner; and

(viii) the Leases constitute all written and oral agreements of any kind for the
leasing, rental, use or occupancy of the Leased Real Property;

(ix) except to the extent the lease expressly requires that the tenant’s equipment
and/or trade fixtures remain at such Leased Real Property after the termination of the
lease, Target has ownership of and the right to remove any and all of Target and its
Subsidiaries’ equipment and trade fixtures, as identified on the consolidated balance sheets
of Target and its Subsidiaries, including the Most Recent Balance Sheet, that are necessary
and appropriate to conduct its business at each Leased Real Property; and

(x) To the Knowledge of Target and any of its Subsidiaries, neither Landlord or any
third party has provided notice or a request for the right to payment of rents, an estoppel,
a Subordination, Non-disturbance and Attornment Agreement or requirement that the Lease be
effective only upon the consent of such other party, except as set forth in Section
4.11(v)(ix) of the Disclosure Schedule.

(c) The Owned Real Property identified in Section 4.11(a) of the Disclosure Schedule
and the Leased Real Property identified in Section 4.11(b) of the Disclosure Schedule
(collectively, the “Real Property”), comprise all of the real property regularly used or intended
to be used in, or otherwise related to, Target’s and its Subsidiaries’ business; and none of Target
or its Subsidiaries is a party to any agreement or option to purchase any real property or interest
therein.

(d) To the Knowledge of Parent and Seller, each have provided Buyer with all existing title
insurance policies, commitments or reports and surveys within their possession or control with
respect to each Real Property.

4.12 Intellectual Property. Section 4.12 of the Disclosure Schedule sets
forth a true and complete list of all registered Intellectual Property and all material
unregistered Intellectual Property owned by, or licensed to, the Target or any of its
Subsidiaries, indicating for each registered item of owned Intellectual Property the registration
or application number and the applicable filing jurisdiction, including all licenses of
Intellectual Property to which Target or any of its Subsidiaries is a party (collectively, the
“Scheduled Intellectual Property”). Except as set forth in Section 4.12 of the Disclosure
Schedule: (i) all Intellectual Property owned by the Target or any of its Subsidiaries is owned
free and clear of all Security Interests, is valid, subsisting and enforceable, and is not subject
to any outstanding order, judgment, decree or agreement adversely affecting the Target’s or its
Subsidiaries’ use thereof or its rights thereto; (ii) the Target and its Subsidiaries own all
right title and interest in and to, or have sufficient rights under a valid and enforceable
written license listed in Section 4.12 of the Disclosure Schedule to use all Intellectual
Property used in their business as presently conducted, all of which rights shall survive
unchanged immediately after the consummation of the transactions contemplated by this Agreement;
(iii) Target and its Subsidiaries in the current conduct of their business do not infringe,
misappropriate or otherwise violate the Intellectual Property rights of any third party and Target
and its Subsidiaries in the past conduct of their business have not infringed, misappropriated or
otherwise violated the Intellectual Property rights of any third party; (iv) to Target’s
Knowledge, no Person is infringing, misappropriating or otherwise violating, or has infringed,
misappropriated or otherwise violated, any Intellectual Property right that the Target or its
Subsidiaries own or hold; (v) no Seller or Affiliate of Seller owns any Intellectual Property that
is used in the Target’s and its Subsidiaries’ business; and (vi) Target’s and its Subsidiaries’
computer firmware, hardware, databases and software (whether general or special purpose),
information technology infrastructure, and other similar or related items of automated,
computerized and/or software systems used or relied upon by the Target and its Subsidiaries in the
conduct of their business are in useable condition in all material respects and are sufficient for
the conduct of the Target’s and its Subsidiaries business as currently conducted in all material
respects.

4.13 Contracts.

(a) Section 4.13 of the Disclosure Schedule lists all of the following agreements
(“Material Contracts”) to which Target or any of its Subsidiaries is a party or bound and denotes
with an asterisk (*) whether the consent of any third party thereto is required under any of the
Material Contracts as a result of the consummation of the transactions contemplated by this
Agreement:

(i) any agreement concerning a partnership or joint venture;

(ii) any agreement (or group of related agreements) under which Target or any of its
Subsidiaries has created, incurred, assumed or guaranteed any Indebtedness for borrowed
money or any capitalized or other lease obligation or under which a Security Interest has
been imposed on any of its assets, tangible or intangible or involving equipment with an
individual or aggregate value in excess of $100,000 or requiring payments in excess of
$100,000;

(iii) any agreement concerning noncompetition or otherwise prohibiting the Target or
any of its Subsidiaries from freely engaging in any business or in any geographic region;

(iv) any agreement with or on behalf of its current or former directors, officers or
employees, or independent consultants including severance agreements, programs, policies or
arrangements, any collective bargaining agreement or any other contract with any labor
union;

(v) any agreement (or group of related agreements) for the lease or sublease of, or
under which Target or any of its Subsidiaries otherwise holds or operates any real or
personal property owned by any other Person providing for payments in excess of $100,000 per
annum;

(vi) any settlement, conciliation or similar agreement pursuant to which, as of and
after the execution date of this Agreement, Target or any of its Subsidiaries will be
required to pay consideration valued in excess of $100,000 or which creates any monitoring,
reporting or oversight obligation of Target or any of its Subsidiaries to any governmental
authority outside the Ordinary Course of Business;

(vii) any agreement under which the consequences of a default or termination could
reasonably be expected to have a Material Adverse Effect;

(viii) any pension, profit sharing, stock option, employee stock purchase, bonus or
other plan or arrangement providing for deferred or other compensation to employees, former
employees or consultants, or any other employee benefit plan or arrangement;

(ix) any contract under which Target or any of its Subsidiaries has advanced or loaned
any other Person amounts in the aggregate exceeding $10,000;

(x) any guaranty, performance bond or similar agreement;

(xi) any lease or agreement under which Target or any of its Subsidiaries is lessor of
or permits any third party to hold or operate any material property, real or personal, owned
or controlled by Target or any of its Subsidiaries;

(xii) any agreement under which Target or any of its Subsidiaries licenses Intellectual
Property to, or licenses Intellectual Property from, a third Person, excluding any licenses
of commercially available, off-the-shelf software programs or licenses purchased or licensed
for less than a total cost of $25,000;

(xiii) any agreement under which it has granted any Person any registration rights
(including demand or piggyback registration rights);

(xiv) any sales or franchise agreement (other than customer agreements);

(xv) any agreement with a term of more than six months which is not terminable by
Target or any of its Subsidiaries upon less than 30 days’ notice without penalty and
involves a consideration in excess of $100,000 annually;

(xvi) any contract regarding voting, transfer or other arrangements related to Target’s
capital stock or warrants, options or other rights to acquire any of the Target’s capital
stock;

(xvii) any settlement, conciliation or similar agreement other than any such agreement
providing solely for the payment of monetary damages which was entered into and fully
performed prior to January 1, 2006;

(xviii) any agreement in the nature of a covenant, condition, easement, restriction,
reservation or encumbrance benefiting the holder of any Owned Real Property or Leased Real
Property;

(xix) any agreement between the Parent, Seller or any of its Subsidiaries (other than
Target and its Subsidiaries), on the one hand, and Target or any of its Subsidiaries, on the
other hand; or

(xx) any other agreement which is material to its operations and business prospects or
involves a consideration in excess of $100,000 annually (other than customer agreements).

(b) Seller has delivered or made available to Buyer on its electronic datasite a correct and
complete copy of each written Material Contract and an accurate description of each oral Material
Contract. With respect to each Material Contract, each Lease listed or required to be listed on
Section 4.11(b) of the Disclosure Schedule and each agreement listed on Section
4.13 of the Disclosure Schedule:

(i) such agreement is legal, valid, binding, enforceable and in full force and effect,
subject to applicable bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting creditors’ rights generally and to general principles of equity, regardless of
whether enforcement is sought in a proceeding at law or in equity;

(ii) None of Parent, Seller, Target nor any of their respective Subsidiaries is in
breach or default, and no event has occurred which with notice or lapse of time would
constitute a breach or default by such Person or permit any third party to terminate, modify
or accelerate, such agreement;

(iii) neither Target nor any of its Subsidiaries has any present expectation or
intention of not fully performing its obligations under such agreement;

(iv) no such agreement is currently subject to or, to Seller’s Knowledge, is expected
to be subject to cancellation or any other material modification by the other party thereto
or is subject to or, to Seller’s Knowledge, is expected to be subject to any penalty, right
of set-off or other charge by the other party thereto for late performance or delivery; and

(v) to Seller’s Knowledge, no third party is in breach or default, and no event has
occurred which with notice or lapse of time would constitute a breach or default by such
third party or permit Target or any of its Subsidiaries to terminate, modify, or accelerate,
such agreement.

4.14 Powers of Attorney. There are no outstanding powers of attorney executed on
behalf of any of the Target and its Subsidiaries.

4.15 Litigation(a) . Except as set forth on Section 4.15 of the Disclosure
Schedule, and except for claims by customers of the Target or its Subsidiaries in the Ordinary
Course of Businesses for cargo damage or destruction seeking solely monetary damages not exceeding
$40,000 individually, there are no (and, subject to the last sentence of this Section 4.15)
during the three years preceding the date hereof, there have not been any) material actions, suits,
proceedings (including any arbitration proceedings), charges, complaints, grievances, orders,
investigations or claims pending or, to Target’s or Seller’s Knowledge threatened against Target or
against Parent, Seller or any of their respective Affiliates and affecting Target or any of its
Subsidiaries (or to Target’s or Seller’s Knowledge, pending or threatened against or affecting any
of the officers, directors or employees of Target or any of its Subsidiaries with respect to their
business or proposed business activities), or pending or threatened by Target or any of its
Subsidiaries against any Person, at law or in equity, or before or by any governmental department,
commission, board, bureau, agency or instrumentality (including any actions, suits, proceedings or
investigations with respect to the transactions contemplated by this Agreement); neither Target nor
any of its Subsidiaries is subject to any arbitration proceedings under collective bargaining
agreements or otherwise; and, to Target’s or Seller’s Knowledge, no facts or circumstances exist
from which it is reasonably likely that any of the foregoing will occur. The foregoing includes,
without limitation, actions pending or threatened involving the prior employment of any of Target’s
or its Subsidiaries’ employees, their use in connection with Target’s or its Subsidiaries’
businesses of any information or techniques allegedly proprietary to any of their former employers
or their obligations under any agreements with prior employers. None of Target and its
Subsidiaries are subject or bound by any judgment, order or decree of any court or other
governmental agency. Section 4.15 of the Disclosure Schedule shall separately identify all
current actions, suits, proceedings (including any arbitration proceedings), charges, complaints,
grievances, orders, investigations or claims from actions, suits, proceedings (including any
arbitration proceedings), charges, complaints, grievances, orders, investigations or claims which
have been resolved prior to the date hereof. Notwithstanding the foregoing, Section 4.15 of
the Disclosure Schedules shall not be required to disclose any actions, suits, proceedings
(including any arbitration proceedings), charges, complaints, grievances, orders, investigations or
claims which have been fully resolved prior to the date of this Agreement and which occurred in the
Ordinary Course of Businesses (i) for personal injury or property damage (including automobile
liability), (ii) for workers compensation or (iii) by customers of the Target or its Subsidiaries
for cargo damage or destruction, in each case seeking solely monetary damages not exceeding $40,000
individually.

4.16 Employee Benefits.

(a) Section 4.16(a) of the Disclosure Schedule lists each Employee Benefit Plan that
any of the Target and its Subsidiaries maintains or to which any of the Target and its Subsidiaries
contributes or is required to contribute and each Employee Benefit Plan maintained by Parent or
Seller or any Subsidiary of Parent or Seller under which any employee or former employee of the
Target and its Subsidiaries participates or is entitled to benefits. Section 4.16(a) shall
identify which, if any, of the Employee Benefit Plans are Target Benefit Plans. Parent and Seller
have delivered to Buyer complete and correct copies of the plan documents and, if applicable,
summary plan descriptions, the most recent determination letter received from the IRS, the most
recent annual report (Form 5500, with all applicable attachments), and all related trust
agreements, insurance contracts, and other funding arrangements that implement each Employee
Benefit Plan set forth on Section 4.16(a).

(i) Each such Employee Benefit Plan set forth on Section 4.16(a) (and each
related trust, insurance contract, or fund) has been maintained, funded and administered in
all material respects in accordance with the terms of such Employee Benefit Plan and
complies in form (or, except as set forth on Section 4.16(a)(i), shall be timely
amended to so comply) and in operation in all material respects with the applicable
requirements of ERISA and the Code.

(ii) All material contributions (including all employer contributions and employee
salary reduction contributions) which are due have been timely made and all material
contributions for any period ending on or before the Closing Date that are not yet due will
have been made or properly accrued with respect to each Employee Benefit Plan which is an
Employee Pension Benefit Plan or Target Benefit Plan. All material premiums, claims or
other payments (including all employer contributions and employee salary reduction
contributions) for all periods ending on or prior to the Closing Date which are due will
have been paid or properly accrued with respect to each such Employee Benefit Plan which is
an Employee Welfare Benefit Plan. Target and its Subsidiaries have fully complied with all
of the provisions of Sections 601 to 609 of ERISA and Sections 701 to 709 of ERISA.

(iii) Each such Employee Pension Benefit Plan which is intended to meet the
requirements of a “qualified plan” under Code §401(a) has received a determination letter
from IRS to the effect that it meets the requirements of Code §401(a) and, to the Knowledge
of Seller, nothing has occurred since the date of such determination that could adversely
affect the qualification of such Employee Pension Benefit Plan.

(iv) As of the last day of the most recent prior plan year, the market value of assets
under each such Employee Benefit Plan which is an Employee Pension Benefit Plan (other than
any Multiemployer Plan) equaled or exceeded the present value of liabilities thereunder
(determined in accordance with then current funding assumptions). Notwithstanding the
foregoing, this Section 4.16(a) does not apply to any Employee Pension Benefit Plan
which is unfunded and maintained primarily for the purpose of providing deferred
compensation for a select group of management or highly compensated employees.

(v) Except as set forth on Section 4.16(a)(v), none of the Employee Benefit
Plans provides any separation, severance, termination or similar benefit or accelerate any
vesting schedule or alter any benefit structure with respect to any employee or former
employee of Target or its Subsidiaries solely as a result of a change in control of
ownership within the meaning of any Employee Benefit Plans or Section 280G of the Code.

(vi) None of the Target and its Subsidiaries has incurred any liability or has any
potential to the PBGC (other than PBGC premium payments) or otherwise under Title IV of
ERISA (including any withdrawal liability) with respect to any such Employee Benefit Plan
which is an Employee Pension Benefit Plan.

(b) Except as set forth in Section 4.16(b) of the Disclosure Schedule, with respect to
each Target Benefit Plan that any of the Target and its Subsidiaries or any ERISA Affiliate
maintains or has maintained or to which any of them contributes, or has been required to
contribute:

(i) No action, suit, proceeding, hearing, or, to the Knowledge of the Seller,
investigation with respect to any such Target Benefit Plan (other than routine claims for
benefits) is pending, and neither the Target nor the Seller have any Knowledge of any facts
that would give rise to or could reasonably be expected to give rise to any such action,
suit or claim.

(ii) No Target Benefit Plan provides benefits to any employee or former employee of any
entity other than Target and its Subsidiaries and no Target Benefit Plan has any material
unfunded liability that is not accurately reflected on the Most Recent Balance Sheet.

(iii) No Target Benefit Plan is (i) a “defined benefit plan” as defined in Section
3(35) of ERISA or any other plan subject to the funding requirements of Section 412 of the
Code or Section 302 of Title IV of ERISA, (ii) a “multiemployer plan” as defined in Section
3(37) or 4001(a)(3) of ERISA, or (iii) any employee benefit plan, program or arrangement
that provides for post-retirement medical, life insurance or other welfare-type benefits
(other than health continuation coverage required by COBRA).

4.17 Environmental, Health, and Safety Matters. Except as set forth on Section
4.17 of the Disclosure Schedule:

(a) the Target and its Subsidiaries are and have been in material compliance with
Environmental, Health, and Safety Requirements.

(b) the Target and its Subsidiaries have not received any written notice, report or other
information regarding any actual or alleged material violation of Environmental, Health, and Safety
Requirements, or any material liabilities or potential material liabilities (whether accrued,
absolute, contingent, unliquidated or otherwise), including any investigatory, remedial or
corrective obligations, relating to the Target or its Subsidiaries or their current or former
facilities arising under Environmental, Health, and Safety Requirements.

(c) neither the Target nor any of its Subsidiaries nor any of their respective predecessors,
Affiliates has released, treated, stored, disposed of, arranged for or permitted the disposal of,
transported, handled, spilled or exposed any Person to any Hazardous Substance as has given or
would give rise to material liabilities under Environmental, Health, and Safety Requirements.

(d) except as would not give rise to material liabilities or obligations of the Target or any
of its Subsidiaries under Environmental, Health, and Safety Requirements, no Hazardous Substances
are present, in, on, under or emanating from any Owned Real Property or Leased Real Property, or
any formerly owned or leased property, including the land and the improvements, ground water and
surface water thereof.

(f) Neither this Agreement nor the consummation of the transaction that is the subject of this
Agreement will result in any obligations for site investigation or cleanup, or notification to or
consent of government agencies or third parties, pursuant to the New Jersey Industrial Site
Recovery Act (“ISRA”) or any comparable “responsible property transfer” Environmental, Health and
Safety Requirements.

(e) Seller has furnished to Buyer all environmental audits, reports and other material
environmental documents relating to the current or former properties, facilities or operations of
Target and its Subsidiaries, or their affiliates or predecessors, which are in its possession or
under its reasonable control.

This Section 4.17 contains the sole and exclusive representations and warranties of the
Seller with respect to any environmental, health, or safety matters, including without limitation
any liabilities or obligations arising under any Environmental, Health, and Safety Requirements.

4.18 Certain Business Relationships with the Target and Its Subsidiaries. Except as
set forth on Section 4.18 of the Disclosure Schedule, none of the Parent or Seller, their
Affiliates and their respective officers, directors, employees or Affiliates (in each case other
than Target and its Subsidiaries) or, to the Seller’s Knowledge, any individual related by blood,
marriage or adoption to any such Person, or any entity in which such Person has a beneficial
interest, has been involved in any material business arrangement or relationship with any of the
Target or its Subsidiaries within the past twelve (12) months, or is a party to any agreement,
understanding, contract, commitment or transaction with Target or any of its Subsidiaries and none
of the Seller, Parent or their respective Affiliates (other than Target and its Subsidiaries) owns
or has any interest in any asset, tangible or intangible, which is used in the business of any of
the Target or its Subsidiaries.

4.19 Permits. Section 4.19 of the Disclosure Schedules identifies each
material license, franchise, permit, certificate, approval or other similar authorization
affecting, or relating to, the business conducted by the Target and its Subsidiaries (the
“Permits”), together with the name of the government agency or entity issuing such Permit. Except
as set forth on Section 4.19 of the Disclosure Schedules, (a) the Permits are valid and in
full force and effect and each such Permit will be in full force and effect in accordance with its
terms immediately following the Closing (b) neither the Target nor any of its Subsidiaries is in
material violation of the Permits and (c) no action is pending or, to Seller’s Knowledge,
threatened, to revoke, suspend, modify or limit any material Permit.

4.20 Bank Accounts. Section 4.20 of the Disclosure Schedules lists the names
and locations and, as applicable, account numbers of all banks, trust companies, savings and loan
associations and other financial institutions at which the Target or any of its Subsidiaries
maintains safe deposit boxes, checking accounts or other accounts of any nature and the names of
all parties authorized to draw thereon, make withdrawals therefrom or have access thereto.

4.21 Books and Records. The minute books and other similar records of the Target and
each of its Subsidiaries contain a true and complete record, in all material respects, of all
action taken at all meetings and by all written consents in lieu of meetings of the boards of
directors and stockholders and similar governing bodies of the Target and each of its
Subsidiaries. The stock transfer ledgers or other similar records of the Target and each of its
Subsidiaries accurately reflect all transfers of the capital stock of the Target and each of its
Subsidiaries.

4.22 Employees.  

(a) Section 4.22 of the Disclosure Schedules correctly sets forth the name and current
annual salary and bonus paid for Target’s fiscal year ended December 31, 2005 to Target’s and its
Subsidiaries’ employees receiving more than $85,000 in annual compensation and whether any
employees are absent from active employment, including, but not limited to, leave of absence or
disability.

(b) Except as set forth on Section 4.22 of the Disclosure Schedule, Seller has no
Knowledge of any organizational effort presently being made or threatened in writing by or on
behalf of any labor union with respect to the employees of the Target or any of its Subsidiaries
and to the Knowledge of Seller and Parent no such efforts have been made within the last three
years. Neither the Target nor any of its Subsidiaries is experiencing any strikes, grievances,
slowdown, work stoppage, or material unfair labor practice claims. Within the past 3 years,
neither Target nor any of its Subsidiaries have implemented any layoff of employees giving rise to
any obligations under the WARN Act without complying with such obligations.

(c) except as set forth on Section 4.22(c) of the Disclosure Schedule:

(i) neither the Target nor any of its Subsidiaries is party to or bound by any
collective bargaining agreement or relationship;

(ii) to the Knowledge of Parent and Sellers, no executive of Target or any of its
Subsidiaries, employee Target or any of its Subsidiaries with annualized compensation of at
least $85,000, or group of employees of the Target or any of its Subsidiaries have any plans
to terminate employment with the Target or its Subsidiaries;

(iii) the Target and each of its Subsidiaries have, during the past three years,
complied in all material respects with all laws relating to the employment of labor
(including but not limited to provisions thereof relating to wages, hours, equal
opportunity, collective bargaining, immigration, layoffs and the payment of social security
and other Taxes);

(iv) neither the Target nor any of its Subsidiaries nor, to Seller’s Knowledge, any of
their respective employees are subject to any non-compete, nondisclosure, confidentiality,
employment, consulting or similar agreements relating to, affecting or in conflict with the
present or proposed business activities of the Target or any of its Subsidiaries, except for
agreements between Target or its Subsidiaries and their present and former employees.

4.23 Names and Locations. Except as set forth on Section 4.23, during the
five-year period prior to the execution and delivery of this Agreement, neither Target nor any of
its Subsidiaries or their respective predecessors has used any name or names under which it has
invoiced account debtors, maintained records concerning its assets or otherwise conducted
business. All of the tangible assets and properties of Target and its Subsidiaries are located at
the locations set forth on Section 4.23.

4.24 Intentionally Omitted.

4.25 Customers and Suppliers. Section 4.25 of the Disclosure Schedule sets
forth, for each of the fiscal years ended December 31, 2004 and December 31, 2005 and for the
five-month periods ended May 31, 2005 and May 31, 2006, (a) a list of the top twenty customers of
Target and its Subsidiaries (on a consolidated basis) (by volume of sales to such customers) and
(b) a list of the top ten suppliers of Target and its Subsidiaries (on a consolidated basis) (by
volume of purchases from such suppliers), and, with respect to such customers, the committed
volume of services to be provided to such customers for the fiscal year ending December 31, 2006.
None of Parent or Seller have any Knowledge that Parent, Seller, Target or any of their respective
Subsidiaries have received any notice from any customer identified or required to be identified on
Section 4.25 of the Disclosure Schedule with respect to the five-month period ended May
31, 2006 or from any agent or representative of any such customer, to the effect that such
customer will stop, materially decrease the rate of, or materially change the terms (whether
related to payment, price or otherwise) with respect to, purchasing services from Target or any of
its Subsidiaries (whether as a result of the consummation of the transactions contemplated hereby
or otherwise). None of Parent or Seller have any Knowledge that Parent, Seller, Target or any of
their respective Subsidiaries have received any notice from any supplier identified or required to
be identified on Section 4.25 of the Disclosure Schedule with respect to the five-month
period ended May 31, 2006 or from any agent or representative of any such supplier to the effect
that such supplier will stop, materially decrease the rate of, or materially change the terms
(whether related to payment, price or otherwise) with respect to, supplying materials, products or
services to Target or any of its Subsidiaries (whether as a result of the consummation of the
transactions contemplated hereby or otherwise).

4.26 Insurance. Section 4.26(a) of the Disclosure Schedule lists each
insurance policy maintained by or on behalf of the Target and each of its Subsidiaries. All of
such insurance policies are in full force and effect and shall remain so until the Closing, at
which time the Target shall cease to participate in the policies marked with an asterisk (*) on
Section 4.26(a) of the Disclosure Schedule. Parent and Seller have delivered to Buyer and
its insurance advisor an accurate, correct and complete loss history of Target and its
Subsidiaries from March 1, 2000 through April 30, 2006 with respect to bodily injury, property
damage and workers compensation claims. Since April 30, 2006, there have been no material losses
outside of the Ordinary Course of Business and the loss history of Target and its Subsidiaries
with respect to bodily injury, property damage and workers compensation has been consistent in all
material respects, with respect to amount and types of claims, as the loss history provided by
Parent and Seller to Buyer through April 30, 2006. None of Parent, Seller, Target or any of their
respective Subsidiaries are in default with respect to its obligations under any insurance policy
maintained by it, and none of Parent, Seller, Target or any of their respective Subsidiaries has
been denied insurance coverage. Except as set forth on Section 4.26(a), none of Parent,
Seller, Target and their respective Subsidiaries have any self-insurance or co-insurance programs.

4.27 Closing Date. The representations and warranties of the Parent and Seller
contained in Article 3 and 4 and elsewhere in this Agreement and all information
delivered in any schedule, attachment or exhibit hereto or in any certificate delivered by Seller
or Target to Buyer shall be true and correct on the Closing Date as though then made and as though
the Closing Date was substituted for the date of this Agreement throughout such representations
and warranties.

4.28 Disclaimer of other Representations and Warranties. Except as expressly set
forth in this Agreement or any certificate or agreement delivered pursuant to this Agreement, the
Seller makes no representation or warranty, express or implied, at law or in equity, in respect of
the Target, its Subsidiaries, or any of their respective assets, liabilities or operations,
including, without limitation, with respect to merchantability or fitness for any particular
purpose, and any such other representations or warranties are hereby expressly disclaimed. Buyer
hereby acknowledges and agrees that, except to the extent specifically set forth in this Agreement
or any certificate or agreement delivered pursuant to this Agreement, the Buyer is purchasing the
Target Shares on an “as-is, where-is” basis.

ARTICLE 5

Pre-Closing Covenants

The Parties agree as follows with respect to the period between the execution of this
Agreement and the Closing.

5.1 General. Each of the Parties will use its reasonable best efforts to take all
action and to do all things necessary, proper, or advisable in order to consummate and make
effective the transactions contemplated by this Agreement (including satisfaction, but not waiver,
of the closing conditions set forth in Article 7 below).

5.2 Notices and Consents. The Parent and Seller will cause each of the Target and
its Subsidiaries to give any notices to third parties, and will cause each of the Target and its
Subsidiaries to use its commercially reasonable efforts to obtain any third party consents, that
are required in connection with the transactions contemplated by this Agreement pursuant to the
terms of any contract, lease, license, instrument or other arrangement to which the Target or any
of its Subsidiaries is a party or is bound; provided, however, notwithstanding
anything to the contrary contained in this Agreement, none of the Parent, Seller, Target or any of
its Subsidiaries are obligated to pay any material amount in order to obtain any consents or
authorizations required to consummate the transactions contemplated in this Agreement. Each of
the Parties will (and the Parent and Seller will cause each of the Target and its Subsidiaries to)
give any notices to, make any filings with, and use its reasonable best efforts to obtain any
authorizations, consents, and approvals of governments and governmental agencies required to
consummate the transactions contemplated in this Agreement.

5.3 Employees; Employee Non-Compete Agreements.

(a) Prior to the Closing, Parent, Seller and their respective Affiliates (other than the
Target and its Subsidiaries) shall transfer and assign to Target all of their rights, title and
interest in and to any agreement between such Person and an Acquired Employee pursuant to which an
Acquired Employee is restricted from competing with the Parent, Seller or any of their respective
Affiliates or from disclosing any Confidential Information.

(b) Prior to the Closing, without the express written consent of Buyer, Parent and Seller
shall not, and shall cause their respective Subsidiaries not to, (a) transfer any employee of the
Target or its Subsidiaries to, or otherwise permit any employee of the Target or its Subsidiaries
to become an employee of, Seller or any of its Subsidiaries other than Target or its Subsidiaries
and (b) transfer any employee of the Parent or Seller or their respective Subsidiaries (other than
Target or its Subsidiaries) to, or otherwise permit any employee of the Parent or Seller or their
respective Subsidiaries (other than Target or its Subsidiaries) to become an employee of Target or
any of its Subsidiaries.

	 	 	 
	5.4

	 	Intentionally Omitted.
	
 
	 	 
	5.5

	 	Intentionally Omitted.
	
 
	 	 
	5.6

	 	Intentionally Omitted.
	
 
	 	 
	5.7

	 	Intentionally Omitted.
	
 
	 	 
	5.8

	 	Intentionally Omitted.
	
 
	 	 

5.9 Termination of Affiliate Agreements. Between the date hereof and the Closing
Date, Parent and Seller will terminate and will cause Target and each of their respective
Subsidiaries to terminate all inter-company agreements between Target or any of its Subsidiaries
on the one hand and Parent or any Subsidiary or Affiliate of Parent (other than Target or its
Subsidiaries) on the other hand, with no further obligation or liability of the Target or any of
its Subsidiaries and on terms reasonably satisfactory to Buyer, including, without limitation,
that certain Administrative Services Agreement, dated January 1, 2003, between Parent and Target
(the “Administrative Services Agreement”) and (ii) that certain Letter Agreement dated December
31, 2003, between SCS Transportation, Inc. and Jevic Transportation, Inc. and the related
Revolving Credit Promissory Note in the principal amount of $75,000,000 dated December 31, 2003
(the “SCS Line of Credit”).

5.10 Termination of Guaranties. Between the date hereof and the Closing Date, Parent
and Seller shall cause each guaranty by Target or any of its Subsidiaries of the obligations of
Parent, Seller or any of their respective Subsidiaries or Affiliates (other than Target and its
Subsidiaries) to be terminated and released without incurring any further obligation or liability
to Target or any of its Subsidiaries, contingent or otherwise, and on terms reasonably
satisfactory to Buyer (such termination and releases, the “Guaranty Releases”), including, without
limitation (i) that certain Restated Guaranty Agreement dated January 31, 2005 by Target in favor
of Bank of Oklahoma, N.A., U.S. Bank National Association, JPMorgan Chase Bank, N.A., Harris Trust
and Savings Bank and LaSalle Bank National Association in connection with the SCS Transportation,
Inc. Agented Revolving Credit Agreement dated September 20, 2002 and the amendments thereto, and
(ii) that certain Guaranty Agreement dated September 20, 2002 by Saia Motor Freight Lines, Inc.
and Jevic Transportation, Inc. in connection with the Master Shelf Agreement of even date between
SCS Transportation, Inc., Prudential Investment management, Inc., The Prudential Insurance Company
of America, Pruco Life Insurance Company, Reliastar Life Insurance Company and Southland Life
Insurance Company.

5.11 Termination of Administrative Manager’s Employment Contracts; Conversion.
Seller and Parent shall cause CRP to be converted into a limited liability company on terms
reasonably satisfactory to Buyer prior to the Closing. Seller and Parent shall cause Target and
its Subsidiaries to provide notice of termination, on terms and conditions reasonably satisfactory
to Buyer, with respect to each of (i) the administrative manager’s employment contracts with Creek
Road Properties, Inc., a Delaware corporation (“CRP”) (including without limitation (a) that
certain Administrative Manager’s Employment Contract by and between CRP and Darryl E. Smith, dated
as of October 1, 2004, (b) that certain Administrative Manager’s Employment Contract by and
between CRP and Beth L. Peoples, dated as of October 1, 2004, and (c) that certain Administrative
Manager’s Employment Contract by and between CRP and Melinda McGuigan, dated as of January 1,
2006) and (ii) that certain Sublease and Administrative Services Agreement, dated as of October 1,
2004, between CRP and Blue Diamond Realty, LLC (collectively with the administrative manager’s
employment contracts, the “Creek Road Agreements”). Seller and Parent shall procure and deliver to
Buyer resignations of Darryl E. Smith, as an officer and director of CRP.

ARTICLE 6

Post-Closing Covenants

The Parties agree as follows with respect to the period following the Closing.

6.1 General; Access to Insurance. In case at any time after the Closing any further
action is necessary or desirable to carry out the purposes of this Agreement, each of the Parties
will take such further action (including the execution and delivery of such further instruments
and documents) as the other Party reasonably may request, all at the sole cost and expense of the
requesting Party (unless the requesting Party is entitled to indemnification therefor under
Article 8 below). Without limiting the foregoing, after the Closing, Parent and Seller
shall provide Buyer and Target with such access and information as may be reasonably requested by
Buyer to obtain debt financing and shall cooperate with Buyer and Target in connection with Buyer
obtaining any Surveys, Title Policies, Non-Imputation endorsement for either an existing title
insurance policy or for a newly obtained title insurance policy. Parent and Seller shall cause
Target and its Subsidiaries to be permitted to make claims and otherwise have access to all
insurance policies of Parent, the Seller and their Subsidiaries with respect to pre-Closing facts,
circumstances and events.

6.2 Litigation Support. In the event and for so long as any Party actively is
contesting or defending against any action, suit, proceeding, hearing, investigation, charge,
complaint, claim, or demand in connection with (a) any transaction contemplated under this
Agreement (other than against any other Party) or (b) any fact, situation, circumstance, status,
condition, activity, practice, plan, occurrence, event, incident, action, failure to act, or
transaction on or prior to the Closing Date involving or affecting any of the Target and its
Subsidiaries, the other Party shall use its commercially reasonable efforts to cooperate with it
and its counsel in the defense or contest and, upon the reasonable request of such contesting or
defending Party, make available their personnel, and provide such testimony and access to their
books and records as shall be reasonably necessary in connection with the defense or contest, all
at the sole cost and expense of the contesting or defending Party (unless the contesting or
defending Party is entitled to indemnification therefor under Article 8 below).

6.3 Employee Benefit Matters; Compensation.

(a) The Buyer shall provide, or cause the Target to provide as of the Closing Date base salary
and base wages that are substantially similar to the Acquired Employees’ base salary or base wage
as of the Closing Date and employee benefits (but excluding any defined benefit plan benefits,
non-qualified retirement plans, retiree medical benefits or equity based arrangements) that in the
aggregate are competitive in the industry for companies of comparable size and nature and in
similar locations as of the Closing Date. All service with the Seller, Parent, the Target or any
ERISA Affiliate of the Parent or Seller prior to the Closing Date by any Acquired Employee shall be
treated as if it were service with the Buyer or any of the Buyer’s Affiliates for purposes of
determining severance benefits and for purposes of eligibility, vesting (and accrual of benefits
with respect to vacation and sick time only) to the same extent such service was recognized under a
similar Employee Benefit Plan of Parent or Seller, the Target or any ERISA Affiliate as of the
Closing Date. The Buyer shall cause the Target to recognize for purposes of any health and welfare
plans provided by the Buyer or the Target to Acquired Employees following the Closing Date any
copayments and deductibles paid by any Acquired Employee or dependent of such Acquired Employee
under any Target Benefit Plan with respect to health care expenses incurred prior to the Closing
Date, and shall not exclude any preexisting conditions of any such Acquired Employee or dependents
that were not excluded under the Target Benefit Plans immediately prior to the Closing Date.

(b) The Buyer shall cause the Target to (i) satisfy all obligations consistent with the
Target’s existing policies, as set forth on Schedule 6.3(b) hereto, to reemploy or
reinstate any individual who is on a leave of absence, paid or unpaid (including but not limited to
a disability leave, a leave due to an injury or illness subject to workers’ compensation, military
leave or a leave under the Family and Medical Leave Act) or is otherwise absent from active
employment for any other reason on the Closing Date and whose most recent employment prior to the
Closing Date was as an employee of the Target (a list of which employees is set forth on
Schedule 6.3(b)(i) hereto), and (ii) continue the payments to any such individual who is
receiving short term disability pay on the day before the Closing Date under any Target Benefit
Plan in accordance with Target’s applicable short term disability plan or policy until the date
that such payments would otherwise terminate under said short term disability plan or policy. Each
of the Seller and Parent shall take such action necessary to cause each Acquired Employee to vest
in his or her accrued benefit in the Capital Accumulation Plan.

(c) The Parent and Seller shall take all actions necessary to cause the Target to cease, as
and where applicable, to be a participating employer in each Employee Benefit Plan of Parent, the
Seller or their respective Subsidiaries, that is not a Target Benefit Plan, in which Target
participates as of the Closing Date, and to cause each Acquired Employee or dependent of any
Acquired Employee to cease to be eligible for benefits under each such Employee Benefit Plan in
which Target participates with respect to expenses incurred or events occurring after the Closing
Date. For avoidance of doubt, except as specifically set forth in this Section 6.3, the
Parent and Seller shall retain all liabilities and claims with respect to any Employee Benefit Plan
that provides benefits to any current or former employee of Target or its Subsidiaries that is not
a Target Benefit Plan. As of the Closing, there will be no restricted stock awards or long term
incentive awards that were awarded to employees of the Target under Parent’s Amended and Restated
2003 Omnibus Incentive Plan for which the Target will be liable.

(d) The Buyer shall be responsible for the administration of and shall assume any and all
obligations, if any, arising on or after the Closing Date under the continuation coverage
requirements of §§ 601 et seq. of ERISA and § 4980B of the Code and the regulations thereunder
(i.e., COBRA) with respect to the Acquired Employees and their beneficiaries and with respect to
any M&A Qualified Beneficiary (as defined in Treasury Regulation 54.4980(b)).

(e) No provisions of this Agreement shall create any third party beneficiary or other rights
in any employee (including any beneficiary or dependent thereof) or any other Persons in respect of
continued employment with any of the Target, the Parent, Seller or the Buyer or any of their
respective Affiliates, and no provision of this Agreement shall create any such rights in any such
Persons in respect of any benefits that may be provided, directly or indirectly, under any plan,
policy or arrangement which may be established or maintained by any of the Parent, Target, the
Target or the Buyer. No provision of this Agreement shall constitute a limitation on the right of
the Buyer, the Target or any of Buyer’s Affiliates to terminate at will, or cause the termination
at will of, any employee of the Target.

(f) To the extent that the Acquired Employees remain employed with the Target or the Buyer or
any of its Affiliates after the Closing, such Acquired Employees shall not be deemed to be in
violation of any confidentiality or non-competition agreements with the Parent, Seller or any of
their Affiliates (other than the Target or its Subsidiaries), if applicable, solely by virtue of
their continuing employment by the Target or its Subsidiaries from and after the Closing Date.

6.4 Plant Closings. Buyer shall not, and shall cause Target not to, at any time
prior to the sixty-first (61st) day following the Closing Date, without fully complying
with any notice and other requirements of the WARN Act, effectuate (a) a “plant closing” (as
defined in the WARN Act) affecting any site of employment or one or more facilities or operating
units within any site of employment of the Target, or (b) a “mass layoff” (as defined in the WARN
Act) affecting any site of employment of the Target. Prior to the Closing, Parent and Seller
shall provide Buyer with a list of all employee layoffs, by location, implemented by the Target
and each of their Subsidiaries in the 90-day period preceding the Closing.

6.5 Investigation. Buyer acknowledges and agrees that it (a) has made its own
inquiry and investigation into, and, based thereon, has formed an independent judgment concerning
the Target and its Subsidiaries and their business; (b) has been furnished with or given adequate
access to such information about the Target and its Subsidiaries and their business as it has
requested; and (c) other than claims for indemnification against Parent or Seller as in accordance
with the terms hereof, will not assert any claim against Seller or its Affiliates or any of their
respective directors, officers, employees, agents, stockholders, Affiliates, consultants, counsel,
accountants, investment bankers or representatives, or hold any such Persons liable, for any
inaccuracies, misstatements or omissions with respect to information furnished by any such Persons
concerning Parent, Seller or their respective Affiliates, including the Target and its
Subsidiaries and their business, except in the case of fraud. Notwithstanding the foregoing, the
Parent and Seller each acknowledge that the Buyer has relied on the representations made by each
of them in this Agreement and in the certificates and other documents delivered by Parent, Seller,
Target or any of their respective Subsidiaries pursuant hereto, and shall be entitled to pursue
any remedy in accordance with the terms of this Agreement or such other document or certificate
for a breach of any such representation or warranty.

6.6 Maintenance of Records. For a period of five (5) years after the Closing Date,
Each of Parent and the Seller, on the one hand, and Buyer, on the other hand, shall have, upon
reasonable request, reasonable access (at the sole expense of the requesting Party) to all of the
records, books and documents in the possession of the other Party relating to the Target and its
Subsidiaries and their business to the extent that such access may reasonably be required by
Seller or Buyer, as the case may be, in connection with matters relating to or affected by the
operations of the Parent, Seller or the Target prior to the Closing Date. If any Party shall
desire to dispose of any records, books or documents that may relate to operation of the Target or
its Subsidiaries and their business before the Closing prior to the expiration of such five (5)
year period, such Party shall, prior to such disposition, give to the other Party a reasonable
opportunity to segregate and remove such records, books or documents as the other Party may
select. Upon reasonable request during normal business hours, the Parent and its agents shall have
access to all books, records and documents in the possession of the Buyer, the Target or their
respective Subsidiaries necessary to permit the Parent to accurately satisfy its obligations under
applicable reporting rules of the Securities and Exchange Commission. The Buyer shall provide, or
cause Target to provide as of the Closing Date, commercially reasonable assistance to the Parent
or the Seller, at Seller’s sole cost and expense (if applicable), in review of the books and
records of Target as provided herein.

6.7 Use of Names. The Seller and Parent agree that from and after the Closing,
neither Seller nor Parent will use (and they will cause their respective Subsidiaries or
Affiliates not to use) the names “Jevic,” “Jevic Transportation,” or “JTS,” or any derivation
thereof or any other name used by the Target or its Subsidiaries or any name deceptively similar
to any of the foregoing names in any business enterprise or in any commercial relationship.

6.8 Non-Solicitation.

(a) The Parent and Seller acknowledge and agree that the covenants and agreements of the
Parent and Seller set forth in this Section 6.8 were a material inducement to the Buyer to
enter into this Agreement and to perform its obligations hereunder, and that the Buyer and its
stockholders would not obtain the benefit of the bargain set forth in this Agreement as
specifically negotiated by the parties hereto if the Parent or Seller breached the provisions of
this Section 6.8. Buyer acknowledges that the covenants and agreements of Buyer set forth
in this Section 6.8 was a material inducement to the Parent and Seller to enter into this
Agreement and to perform their respective obligations hereunder, and that the Parent and Seller
would not obtain the benefit of the bargain set forth in this Agreement as specifically negotiated
by the parties hereto if Buyer breached the provisions of this Section 6.8.

(b) Each of Parent and the Seller agrees that until the third anniversary of the Closing it
shall not (and Parent and Seller shall cause their Affiliates and Subsidiaries not to) directly, or
indirectly through another Person, (i) induce or attempt to induce any employee of Buyer, the
Target or any of its Subsidiaries or Affiliates to leave the employ of Buyer, the Target or any of
their respective Subsidiaries or Affiliates, or in any way interfere with the relationship between
Buyer, the Target or any of their respective Subsidiaries or Affiliates and any employee thereof,
or (ii) hire any person who was an employee of the Target or any of its Subsidiaries at any time
during the one-year period immediately prior to the Closing Date; provided, however, that the
foregoing shall not prohibit the solicitation or hiring of any person who has been employed by one
or more employers other than Buyer, Target or any of their respective Subsidiaries or Affiliates
continuously for at least 18 months after the termination of such person’s employment with Buyer,
Target or any of their respective Subsidiaries or Affiliates.

(c) Buyer agrees that until the third anniversary of the Closing it shall not (and Buyer shall
cause the Target following the Closing not to) directly, or indirectly through another Person, (i)
induce or attempt to induce any employee of the Parent, Seller or any of their Subsidiaries (other
than an employee of Target or its Subsidiaries) to leave the employ of the Parent, Seller or any of
their Subsidiaries, or in any way interfere with the relationship between Parent, the Seller or any
of their Subsidiaries and any employee thereof, or (ii) hire any person who was an employee of
Parent or the Seller or any of their Subsidiaries (other than a person who was an employee of
Target or its Subsidiaries) at any time during the one-year period immediately prior to the date on
which such hiring would take place; provided, however, that the foregoing shall not prohibit the
solicitation or hiring of any person who has been employed by an employer other than Parent, Seller
or any of their respective Subsidiaries or Affiliates continuously for at least 18 months after the
termination of such person’s employment with Parent, Seller or any of their respective Subsidiaries
or Affiliates.

(d) Each of Parent and the Seller agrees that it shall not (and they shall cause their
respective Affiliates and Subsidiaries not to) make any negative, derogatory or disparaging
statement or communication regarding the Buyer, the Target or any of their respective Subsidiaries,
Affiliates or employees with the intent to harm the Target or Buyer. Buyer agrees that it shall not
(and it shall cause Target and its Subsidiaries not to) make any negative, derogatory or
disparaging statement or communication regarding Parent, Seller or any of their respective
Subsidiaries, Affiliates or employees with the intent to harm Parent or Seller.

(e) If, at the time of enforcement of the covenants contained in this Section 6.8 (the
“Restrictive Covenants”), a court shall hold that the duration, scope or area restrictions stated
herein are unreasonable under circumstances then existing, the parties agree that the maximum
duration, scope or area reasonable under such circumstances shall be substituted for the stated
duration, scope or area and that the court shall be allowed and directed to revise the restrictions
contained herein to cover the maximum period, scope and area permitted by law. The Parties hereto
have consulted with legal counsel regarding the Restrictive Covenants and based on such
consultation have determined and hereby acknowledge that the Restrictive Covenants are reasonable
in terms of duration, scope and area restrictions and are necessary to protect the goodwill of the
Target’s and its Subsidiaries’ business and the substantial investment in the Target and its
Subsidiaries made by the Buyer hereunder, on the one hand, and the goodwill of Parent’s and
Seller’s business on the other hand. Each Party further acknowledges and agrees that the
Restrictive Covenants are being entered into by it in connection with the sale by the Seller of the
Target Shares and the goodwill of the Target’s business pursuant to this Agreement.

(f) If any Party or an Affiliate or Subsidiary of any Party breaches, or threatens to commit a
breach of, any of the Restrictive Covenants, the non-breaching Party shall have the following
rights and remedies, each of which rights and remedies shall be independent of the others and
severally enforceable, and each of which is in addition to, and not in lieu of, any other rights
and remedies available to the non-breaching Party or any of its respective Affiliates at law or in
equity:

(i) the right and remedy to have the Restrictive Covenants specifically enforced by any
court of competent jurisdiction, it being agreed that any breach or threatened breach of the
Restrictive Covenants would cause irreparable injury to the non-breaching Party and that
money damages would not provide an adequate remedy;

(ii) the right and remedy to require the breaching Party to account for and pay over to
the non-breaching Party any profits, monies, accruals, increments or other benefits derived
or received by such Person as the result of any transactions constituting a breach of the
Restrictive Covenants; and

(iii) In the event of any breach or violation by any Party of any of the Restrictive
Covenants, the time period of such covenant shall be tolled until such breach or violation
is resolved.

6.9 Confidentiality.

(a) Each of Parent and the Seller agrees not to disclose or use at any time (and Parent and
the Seller shall cause each of their respective Subsidiaries and Affiliates not to use or disclose
at any time) any Confidential Information of Buyer, Target or any of its Subsidiaries, including,
without limitation, any Confidential Information known by Parent, Seller or any of their respective
Subsidiaries prior to Closing or acquired by the Parent or Seller or any of their respective
Subsidiaries pursuant to Section 6.6 hereof. Parent and Seller further agree to take all
appropriate steps (and to cause each of his Affiliates to take all appropriate steps) to safeguard
such Confidential Information of Buyer, Target and its Subsidiaries and to protect it against
disclosure, misuse, espionage, loss and theft. In the event the Parent, Seller or any Affiliates
of either of them are required by law to disclose any Confidential Information of Buyer, Target and
its Subsidiaries, the Seller and Parent shall promptly notify the Buyer in writing, which
notification shall include the nature of the legal requirement and the extent of the required
disclosure, and each of the Parent, Seller and their Affiliates shall cooperate with the Buyer and
the Target to preserve the confidentiality of such information consistent with applicable law.

(b) Buyer agrees not to disclose or use at any time (and each shall cause Target and its
Subsidiaries not to use or disclose at any time) any Confidential Information of Parent and its
Subsidiaries (other than Target and its Subsidiaries), including, without limitation, any
Confidential Information of Parent and its Subsidiaries (other than Target and its Subsidiaries)
acquired by the Target, Buyer or any of their respective Subsidiaries pursuant to
Section 6.6 hereof. Buyer further agrees to take all appropriate steps (and to cause each
of its Subsidiaries to take all appropriate steps) to safeguard such Confidential Information of
Parent and its Subsidiaries (other than Target and its Subsidiaries) and to protect it against
disclosure, misuse, espionage, loss and theft. In the event the Buyer, Target or any Subsidiaries
of the Target or Buyer are required by law to disclose any Confidential Information of Parent and
its Subsidiaries (other than Target and its Subsidiaries), Buyer or Target shall promptly notify
the Seller in writing, which notification shall include the nature of the legal requirement and the
extent of the required disclosure, and each of the Buyer, Target and their Subsidiaries shall
cooperate with the Seller and the Parent to preserve the confidentiality of such information
consistent with applicable law.

6.10 Indemnification of Officers and Directors. The charter and bylaws of Parent and
Seller shall continue to contain provisions no less favorable with respect to indemnification,
advancement of expenses and exculpation of former or present directors and officers than are
presently set forth in the charter and by-laws of Parent and Seller, which provisions shall not be
amended, repealed or otherwise modified for a period of six years from the Closing in any manner
that would adversely affect the rights thereunder of any such individuals.

6.11 Certain Matters.

(a) CRP. Promptly after the Closing, Seller shall obtain and deliver to Buyer, at
Seller’s sole cost and expense, resignations of Brian T. Harrison as an officer of CRP.

6.12 Assignment of Certain Agreements. Seller and Parent hereby assign to Target,
from and after the Closing, all of their respective rights, title and interest, in and to each of
the Seller Confidentiality Agreements to the extent related to confidential information of, or
otherwise affecting Target or any of its Subsidiaries (but solely to the extent related to or
affecting Target or any of its Subsidiaries) and each of Seller and Parent further agrees that, to
the extent any Seller Confidentiality Agreement is not assignable pursuant to its terms solely to
the extent related to or affecting Target or any of its Subsidiaries, that Seller and Parent
shall, at Target’s request and sole expense, fully enforce all of their respective rights under
such Seller Confidentiality Agreements on behalf of Target to the extent related to or affecting
Target or any of its Subsidiaries.

6.13 Separation and Distribution Agreement. Parent hereby assigns to Target, from
and after the Closing, all of its right, title and interest, in and to that certain Master
Separation and Distribution Agreement, dated as of September 30, 2002, between Parent and Yellow
Corporation (a Delaware corporation) and Parent (the “Distribution Agreement”) to the extent
related to or otherwise affecting Target or its Subsidiaries, and Parent further agrees that, to
the extent that the Distribution Agreement is not assignable pursuant to its terms solely to the
extent related to or affecting Target or any of its Subsidiaries, that Parent shall, at Target’s
request and sole expense, fully enforce all of its rights thereunder on behalf of Target to the
extent related to Target or any of its Subsidiaries.

6.14 Insurance.

(a) As of the Closing, either Buyer, Target or another Person shall provide letters of credit
or similar collateral guarantees reasonably acceptable to Parent in favor of Parent (collectively,
the “Buyer L/C”) with respect to Parent’s liability under indemnity and guarantee agreements with
United States Fidelity and Guaranty Company dated March 1, 2000 (collectively “Indemnity
Agreements”) for insurance claims against Target arising solely out of Target’s operations (and not
related to the operations of Parent, Seller or any of their Subsidiaries other than Target) for the
period from March 1, 2000 through Closing (the “L/C Claims”). At any time following the issuance of
the Buyer L/C, Buyer, Target or its Subsidiaries may replace the Buyer L/C with a replacement
Buyer L/C and Parent and its Subsidiaries shall take all actions reasonably necessary to permit
Buyer, Target or its Subsidiaries to replace the Buyer L/C. The initial amount of such letter of
credits at Closing shall be in an aggregate amount equal to $15.3 million. At each anniversary date
of the Closing Date, the Target shall be allowed to adjust the outstanding letters of credit to an
aggregate amount equal to the incurred ultimate outstanding limited liability of Target for the
period from March 1, 2000 through Closing. For purposes hereof, the “incurred ultimate outstanding
limited liability” shall mean the aggregate incurred (limited to applicable deductibles /
self-insured retention amounts) claim value totals for the policy periods March 1, 2000 through
Closing, valued by policy year and coverage line as of the April 30 prior to the applicable
anniversary date and multiplied by the then-current A.M. Best loss development factors (including
without limitation countrywide, by state, industry factors, and other items) reduced by any paid
losses by coverage line and by policy year through the valuation date. Parent and its Subsidiaries
shall not terminate any of the Indemnity Agreements or amend or otherwise modify any of the
Indemnity Agreements in a manner adverse to Buyer, Target or their respective Subsidiaries without
the consent of Buyer.

(b) Parent or Seller shall promptly (but in no event more than four business days after
receipt of notice by Parent or Seller) provide notice to Buyer of (i) any communication from their
insurance carriers to Parent or Seller that a notice of default under the Indemnity Agreements
related to Target or any of its Subsidiaries is reasonably likely to be delivered or any other
matter which could reasonably be expected to be material and adverse to Target and its Subsidiaries
with respect to its insurance coverage or insurance collateral, or (ii) any notice of any default
delivered to Parent, Seller or any of their Subsidiaries under the Indemnity Agreements related to
Parent, Seller, Target or any of its Subsidiaries or any communication to Parent, Seller or any of
their respective Subsidiaries that any of the letters of credit securing Parent’s liability under
the Indemnity Agreements will be drawn upon unless a payment is made with respect to any L/C Claim.

(c) Buyer shall promptly (but in no event more than four business days after receipt of notice
by Buyer or Target) provide notice to Seller of (i) any communication by Seller’s insurance
carriers to Buyer or Target that a notice of default under the Indemnity Agreements related to
Target or any of its Subsidiaries is reasonably likely to be delivered or any other matter which
could reasonably be expected to be material and adverse to Target and its Subsidiaries with respect
to its insurance coverage or insurance collateral, or (ii) any notice of any default delivered to
Buyer, Target or any of their Subsidiaries under the Indemnity Agreements related to Target or any
of its Subsidiaries or any communication to Buyer, Target or any of their Subsidiaries that any of
the letters of credit securing Parent’s liability under the Indemnity Agreements will be drawn upon
unless a payment is made with respect to any L/C Claim.

(d) Parent or its insurance advisor, at Parent’s sole cost and expense, shall at least
annually be allowed to conduct an audit of the claims prior to the calculation of the letter of
credit requirement. Parent or its insurance advisor shall be provided the annual calculation of
collateral by Buyer at least 30 days in advance of the anniversary date and allowed reasonable
access during normal business hours to claims data in order to validate and recalculate the letters
of credit requirement.

(e) Seller shall not be entitled to draw on the Buyer L/C under any circumstances except as
expressly permitted in this clause (e). Seller shall only draw down on the Buyer L/C as follows:

(i) with respect to a particular L/C Claim, the amount of such reimbursement minus any
amounts disputed in good faith by Buyer or Target shall be drawable in the event that Parent
and Seller have complied with their obligations pursuant to clause (b) above to the extent
that (A) Parent or Seller received notice that the letters of credit securing Parent’s
liability under the Indemnity Agreements would be drawn upon unless payment was made with
respect to such L/C Claim(s) (a “Demand”), (B) Parent reimbursed the insurance company under
the Indemnity Agreements with respect to such L/C Claim(s) not earlier than three business
days prior to the date the letters of credit would be drawn pursuant to the Demand, and (C)
Buyer had not provided reasonable written evidence of payment, or oral confirmation of
payment from the insurance company, of such L/C Claim prior to the time of such
reimbursement; or

(ii) with respect to a particular L/C Claim, the amount of such reimbursement minus any
amounts disputed in good faith by Buyer or Target shall be drawable in the event that the
letters of credit securing Parent’s liability under the Indemnity Agreements for the L/C
Claims has been drawn with respect to any such L/C Claim; or

(iii) in the event that (x) Parent or Seller receives written notice from the issuer of
such Buyer L/C that the Buyer L/C will not be renewed at the end of its term (the
“Termination Date”) and Parent promptly provides such notice to Buyer, (y) the Buyer L/C or
other collateral continues to be required pursuant to clause (a) above, and (z) Buyer or its
Subsidiaries do not cause such notice of nonrenewal to be rescinded or otherwise replace the
Buyer L/C prior to the tenth day immediately preceding the Termination Date, the entire
amount of the Buyer L/C on or after such date.

In the event that the Buyer L/C is drawn pursuant to clause (e)(iii) above, then Seller and Parent,
jointly and severally, shall pay the entire aggregate amount of such Buyer L/C drawn by Seller or
Parent upon replacement of such Buyer L/C on terms and conditions reasonably satisfactory to
Seller.

(f) In the event Parent’s insurance carrier no longer covers any L/C Claims (other than due to
any action or omission by Buyer, Target or their Subsidiaries), then Seller and Parent shall cause
the Buyer L/C to be released. In the event such insurance is recovered or reinstated on terms
reasonably satisfactory to Buyer, then Buyer shall replace the Buyer L/C on terms and conditions
reasonably satisfactory to Seller.

6.15 Surety Bonds. Parent, Seller and Target are parties to a general agreement of
indemnity dated April 30, 2004 with Zurich American Insurance Company and Subsidiaries and
Affiliates (Zurich) under which Target has outstanding surety bonds as listed on Section
6.15 of the Disclosure Schedule (the “Outstanding Surety Bonds”), primarily for taxes, tolls
and other business operational needs. Following the Closing, Buyer shall cause Target to use
commercially reasonable efforts, within 30 days following the Closing, to either (a) assist Parent
and Seller in their efforts to cause Parent and Seller to be released from liability with respect
to the Outstanding Surety Bonds, or (b) replace the Outstanding Surety Bonds with replacement
security bonds, letters of credit, or a combination of replacement security bonds and letters of
credit. So long as the Outstanding Surety Bonds remain outstanding, Buyer shall indemnify Parent
and Seller for any Adverse Consequences with respect to the Outstanding Surety Bonds which are
directly related to actions of Buyer or Target after the Closing Date.

6.16 Claims Administration. Parent and Seller shall promptly forward to Buyer any
notices or other material communications from the insurance company regarding insurance claims
relating solely to Target and its Subsidiaries. Parent or Seller will monitor and process invoices
for claims payments made by and administration expenses incurred by Broadspire (the third-party
claims administrator for Parent, Seller and Target for workers compensation, bodily injury and
property damage, and general liability claims for policy years from March 1, 2000 to the present)
related to the handling and disposition of claims on behalf of Target. Promptly following the
Closing, Parent, Seller and Buyer shall use their commercially reasonable efforts to cause all
invoices from Broadspire related to Target claims to be billed directly to the Buyer or Target,
and the Buyer shall cause the same to be paid within the terms and conditions agreed to between
Buyer and Boradspire but in any event, no later than thirty days of the receipt of such invoice
(except with respect to any amounts which Buyer or Target allege in good faith are related to
Parent, Seller or their respective Subsidiaries). Parent and Seller shall afford Target and its
Subsidiaries to have the same information and approval rights with respect to claims related to
Target and its Subsidiaries as Target and its Subsidiaries were afforded prior to the Closing in
the Ordinary Course of Business. If Target continues to participate in the Broadspire arrangement
and the Buyer is not directly billed for such services, the Buyer shall reimburse the Seller for
all out-of-pocket claim payments and claims administration fees paid by Parent or Seller to
Broadspire solely with respect to Target’s claims. Such reimbursements shall be paid to Parent by
wire transfer within five business after notice to Buyer (except with respect to any amounts which
Buyer or Target allege in good faith are related to Parent, Seller or their respective
Subsidiaries). Parent and Seller shall take all actions reasonably requested by Buyer and Target
(at Target’s expense) with respect to any disputes related to claims against Target or any of its
Subsidiaries, with respect to any disputes between Target or any of its Subsidiaries and
Broadspire, or with respect to any disputes between Parent or Seller against Broadspire with
respect to Target or any of its Subsidiaries or their respective businesses.

6.17 Insurance Premiums and Claims. Self-insurance, retention, deductible,
retrospective premium or similar terms related to out-of-pocket insurance costs, including without
limitation associated out-of-pocket administrative expenses, loss adjustment or similar expenses
and related state insurance assessments and taxes arising after the Closing under any current or
former insurance policy or policies maintained by Parent or Seller which are identified on
Section 4.26(a) of the Disclosure Schedule and solely to the extent directly attributable
to liabilities or losses of Target prior to the Closing (as determined as a result of premium /
insurance program audits or claim / retrospective adjustments) shall be allocated to Target
(except with respect to any amounts which Buyer or Target allege in good faith are related to
Parent, Seller or their respective Subsidiaries). All other self-insurance, retention, deductible,
retrospective premium or similar terms related to out-of-pocket insurance costs shall be allocated
to Parent and Seller. To the extent that any Party pays any expenses that are determined in
accordance with this Section to be properly allocable to another Party, the responsible Party
shall promptly reimburse the paying Party. Buyer, Target, Parent and Seller shall cooperate fully,
as and to the extent reasonably requested by the other Party to document the allocation decisions
hereunder.

6.18 Specified Premises. Parent and Seller, at their sole cost and expense, shall
fully perform and satisfy (i) all obligations arising under ISRA or any other applicable
Environmental Laws with respect to the cessation of operations at the Specified Premises and the
termination of the Specified Lease other than to the extent of events or circumstances occurring
after the Closing which are not related to or caused by actions or omissions of Parent, Seller or
any of their Subsidiaries and (ii) all obligations under the Specified Lease with respect to
environmental, health and safety matters (other than to the extent of events or circumstances
occurring after the Closing which are not related to or caused by actions or omissions of Parent,
Seller or any of their Subsidiaries), including all obligations to remove, close, dispose, clean
up, investigate, and undertake any other actions relating to, any aboveground or underground
storage tanks currently or formerly located at the Specified Premises in compliance with
applicable laws, including the proper removal of the existing 20,000 gallon underground fuel tank
and the proper closing of the 1,000 gallon waste oil tank located on the Specified Premises.

ARTICLE 7

Conditions to Obligation to Close

7.1 Conditions to Obligation of the Buyer. The obligation of the Buyer to consummate
the transactions to be performed by it in connection with the Closing is subject to satisfaction
of the following conditions:

(a) each of the representations and warranties of Parent and the Seller contained in
Section 3.1 and Article 4 (i) that are qualified as to materiality shall be true
and correct in all respects and (ii) that are not so qualified shall be true and correct in all
material respects when made and as of the Closing Date, in each case as though then made and as
though the Closing Date was substituted for the date of this Agreement throughout such
representations and warranties, except to the extent that any such representation or warranty
relates to a specified date, in which case such representations and warranties shall be true and
correct as of such date;

(b) the Seller shall have performed and complied with all of its covenants hereunder in all
material respects through the Closing;

(c) no statute, regulation, injunction, judgment, decree or order of any governmental body
shall be in effect that restrains or prohibits the transactions contemplated hereby or that
otherwise (i) would cause any of the transactions contemplated by this Agreement to be rescinded
following consummation, (ii) affects adversely the right of Buyer to own the Target Shares or
operate the businesses of or control the Target and its Subsidiaries or (iii) affects adversely the
right of the Target and its Subsidiaries to own their respective assets or control their respective
businesses, nor shall there be pending or threatened any action or proceeding by or before any
governmental body challenging the lawfulness of or seeking to prevent any of the transactions
contemplated by this Agreement, seeking monetary or other relief by reason of the consummation of
any of such transactions, or wherein an unfavorable injunction, judgment, ruling, decree or order
would cause any of the (i)-(iii) above;

(d) no event, transaction, condition or change shall have occurred since the date of this
Agreement that has had or would reasonably be expected to have a Material Adverse Effect;

(e) Buyer shall have received from Bryan Cave LLP, counsel for the Seller, the Target and its
Subsidiaries, an opinion with respect to the matters set forth in Exhibit C attached
hereto, which shall be addressed to Buyer and Buyer’s lenders, dated as of the Closing Date, and in
form and substance reasonably satisfactory to Buyer;

(f) The Target shall have obtained releases of all Security Interests (other than any
Permitted Encumbrances) relating to the assets and properties of the Target;

(g) [Intentionally Omitted];

(h) The Buyer shall have obtained, no later than ten days prior to the Closing, a proposed
marked-up commitment for a 1992 ALTA Owner’s Title Insurance Policy or other form of pro forma
policy acceptable to the Buyer for each Owned Real Property, issued by a title insurance company
satisfactory to the Buyer (the “Title Company”), together with a copy of all documents referenced
therein (the “Title Commitments”);

(i) At the Closing, the Buyer shall have the ability to obtain title insurance policies from
the Title Company (which may be in the form of a mark-up of a pro forma of the Title Commitments)
in accordance with the Title Commitments, insuring each of the Target’s and its Subsidiaries’ fee
simple title to each Owned Real Property as of the Closing Date (including all recorded appurtenant
easements, insured as separate legal parcels), with gap coverage from Seller through the date of
recording, subject only to Permitted Encumbrances, in such amount as the Buyer reasonably
determines to be the value of the Real Property insured thereunder and include the endorsements
identified herein and a non-imputation endorsement as well as such other endorsements commonly
required by financial institutions (the “Title Policies”);

(j) The Buyer shall have obtained, no later than ten days prior to the Closing, a survey for
each Owned Real Property, dated no earlier than the date of this Agreement, in accordance with
ALTA/ASCM standards and such other standards as the Title Company and the Buyer require as a
condition to the removal of any survey exceptions from the Title Policies, and certified to Buyer,
Buyer’s lender and the Title Company, in a form and with a certification satisfactory to each of
such parties (the “Surveys”);

(k) the Target and its Subsidiaries shall have obtained and delivered to the Buyer an estoppel
certificate from each landlord with respect to each of the Leases, dated no more than 30 days prior
to the Closing Date, from the other party to such Lease, in form and substance satisfactory to the
Buyer (the “Estoppel Certificates”);

(l) the Parties, the Target, and its Subsidiaries shall have received all other material
authorizations, consents, and approvals of governments and governmental agencies referred to in
Section 3.1(b), 3.2(b), and Section 4.3 above, and all other the
third-party consents and approvals that are necessary (i) for the consummation of the transactions
contemplated hereby or (ii) to prevent a breach of or default under, or a termination, modification
or acceleration of, any contract or agreement identified on the Schedule 7.1(l) attached
hereto, in each case on terms reasonably satisfactory to Buyer (the “Third-Party Approvals”);

(m) the Seller shall have delivered to the Buyer:

(i) certificates of the appropriate public officials to the effect that each of Parent,
the Seller, the Target and each of the Target’s Subsidiaries is a validly existing entity in
good standing in its state of organization and, with respect to the Target and each of its
Subsidiaries, in each jurisdiction it is qualified to do business as a foreign corporation,
in each case dated as of a recent date prior to the Closing Date;

(ii) incumbency and specimen signature certificates dated the Closing Date, signed by
the officers of Parent, the Seller and the Target who have executed this Agreement or any
certificate or other agreement contemplated herein and certified by a secretary or assistant
secretary of such Person;

(iii) A certificate of the Secretary or Assistant Secretary of each of Parent, the
Seller and the Target (A) setting forth all authorizations of Parent, the Seller and the
Target, including resolutions of Parent’s, the Seller’s and Target’s boards of directors and
stockholders resolutions of the Seller, authorizing the execution and delivery of this
Agreement and the performance by Parent, the Seller and the Target of the transactions
contemplated hereby, and (B) certifying as correct the governing documents of Parent, the
Seller, the Target, and the Target’s Subsidiaries;

(iv) a certificate to the effect that each of the conditions specified above in
Sections 7.1(a)-(g) and in Section 7.1(l) is satisfied in all respects;

(v) A non-foreign affidavit as described in Section 1445(b)(2) of the Code and the
regulations thereunder executed by the Seller;

(vi) The Third-Party Approvals;

(vii) The Transition Services Agreement, duly executed by Parent and the Seller, in the
form attached hereto as Exhibit A (which shall be in full force and effect) (the
“Transition Services Agreement”).

(viii) Executed resignations of all of the incumbent officers, directors, managers or
individuals holding similar positions of the Target and each of its Subsidiaries, effective
as of the Closing;

(ix) evidence (in form and substance satisfactory to the Buyer) that the Target’s and
Seller’s legal counsel, investment bankers, brokers and other agents and representatives
have been paid in full and that neither the Target nor any of its Subsidiaries has any
liability to any of the Target’s or Seller’s legal counsel, investment bankers, brokers,
agents or representatives;

(x) a certificate from the Seller setting forth its good faith determination of the
Purchase Price (the “Estimated Purchase Price Certificate”), including its good faith
determination of (A) the Closing Indebtedness, (B) the Closing Net Working Capital as
determined in a manner consistent with the Purchase Price Calculation Schedule, and (C) all
Closing Seller Expenses which are not paid by the Seller at or prior to the Closing, which
certificate shall have been delivered at least two days prior to Closing;

(xi) evidence of termination of the Administrative Services Agreement on terms and
conditions satisfactory to Buyer;

(xii) evidence of termination of the SCS Line of Credit and release of Jevic from any
and all obligations thereunder on terms and conditions satisfactory to Buyer;

(xiii) evidence of the Guaranty Releases;

(xiv) evidence of notice of termination of each of the Creek Road Agreements and on
terms and conditions reasonably acceptable to Buyer; and

(xv) such other documents or instruments as are required to be delivered by Seller,
Parent or the Target at the Closing pursuant to the terms hereof or that the Buyer
reasonably requests prior to the Closing Date to effect the transactions contemplated
hereby.

All actions to be taken by the Target or the Seller in connection with consummation of the
transactions contemplated hereby and all certificates, instruments, and other documents required to
effect the transactions contemplated hereby shall be reasonably satisfactory in form and substance
to the Buyer. The Buyer may waive any condition specified in this Section 7.1 if it
executes a writing so stating at or prior to the Closing.

7.2 Conditions to Obligation of the Seller, the Parent and the Target. The
obligation of the Seller, the Parent and the Target to consummate the transactions to be performed
by them in connection with the Closing is subject to satisfaction of the following conditions:

(a) each of the representations and warranties of the Buyer contained in Section 3.2
(i) that are qualified as to materiality shall be true and correct in all respects and (ii) that
are not so qualified shall be true and correct in all material respects when made and as of the
Closing Date, in each case as though then made and as though the Closing Date was substituted for
the date of this Agreement throughout such representations and warranties, except to the extent
that any such representation or warranty relates to a specified date, in which case such
representations and warranties shall be true and correct as of such date;

(b) the Buyer shall have performed and complied with all of its covenants hereunder in all
material respects through the Closing;

(c) no statute, regulation, injunction, judgment, decree or order of any governmental body
shall be in effect that restrains or prohibits the transactions contemplated hereby or that
otherwise would cause any of the transactions contemplated by this Agreement to be rescinded
following consummation, nor shall there be pending or threatened any action or proceeding by or
before any governmental body challenging the lawfulness or seeking to prevent any of the
transactions contemplated by this Agreement, seeking monetary or other relief by reason of the
consummation of any of such transactions or wherein an unfavorable injunction, judgment, ruling,
decree or order would cause any of the foregoing;

(d) the Buyer shall have delivered to the Seller a certificate to the effect that each of the
conditions specified above in Sections 7.2(b)-(c) is satisfied in all respects;

(e) the Buyer shall have delivered to the Seller:

(i) certificates of the appropriate public officials to the effect that the Buyer is a
validly existing entity in good standing in its state of organization;

(ii) incumbency and specimen signature certificates dated the Closing Date, signed by
the officers of Buyer and certified by Buyer’s Secretary or Assistant Secretary;

(iii) The Transition Services Agreement, duly executed by the Buyer (which shall be in
full force and effect).

(iv) a certificate of the Secretary or Assistant Secretary of Buyer (A) setting forth
all authorizations of Buyer authorizing the execution and delivery of this Agreement and the
performance by Buyer of the transactions contemplated hereby, and (B) certifying as correct
the governing documents of Buyer; and

(v) such other documents or instruments as are required to be delivered by the Buyer at
the Closing pursuant to the terms hereof or that the Seller reasonably requests prior to the
Closing Date to effect the transactions contemplated hereby.

All actions to be taken by the Buyer in connection with consummation of the transactions
contemplated hereby and all certificates, instruments, and other documents required to effect the
transactions contemplated hereby will be reasonably satisfactory in form and substance to the
Seller. The Seller or Target may waive any condition specified in this Section 7.2 if the
Seller or Target executes a writing so stating at or prior to the Closing.

ARTICLE 8

Remedies for Breaches of This Agreement 

8.1 Survival of Representations and Warranties. All of the representations and
warranties of the Parties contained in this Agreement and in any certificate delivered with
respect hereto shall survive the Closing hereunder and continue in full force and effect for a
period of fifteen (15) months thereafter; provided, however, that the applicable
Parties’ representations and warranties contained in (a) Section 4.10 (Tax Matters),
Section 4.16 (Employee Benefits), and Section 4.27 (Closing Date) with respect to
Sections 4.10 and 4.16 shall survive until ninety (90) days following the
expiration of the applicable statute of limitations in respect of such matters (after giving
effect to any extensions or waivers thereof); (b) Section 4.17 (Environmental, Health and
Safety Matters), and Section 4.27 (Closing Date) with respect to Section 4.17
shall survive until the fifth anniversary of the Closing Date; and (c) Section 3.1(e)
(Target Shares), the first sentence of Section 4.1 (Organization, Qualification and
Corporate Power), Section 4.2 (Capitalization), the first sentence of Section 4.5
(Title to Assets; Asset Sufficiency), Section 4.6 (Subsidiaries), and 4.27 (Closing Date)
with respect to Section 3.1(e), the first sentence of Section 4.1, Section
4.2, the first sentence of Section 4.5, and Section 4.6 will survive forever;
provided that any representation or warranty in respect of which indemnity may be
sought under this Article 8, and the indemnity with respect thereto, shall survive the
time at which it would otherwise terminate pursuant to this Section 8.1 if written notice
(in reasonable detail) of the inaccuracy or breach or potential inaccuracy or breach thereof
giving rise to such right or potential right of indemnity shall have been given to the Party
against whom such indemnity may be sought prior to such time (regardless of when the Adverse
Consequences in respect thereof may actually be incurred). The representations and warranties in
this Agreement and the Schedules and Exhibits attached hereto or in any writing delivered by any
party to another party in connection with this Agreement shall survive for the periods set forth
in this Section 8.1 and shall in no event be affected by any investigation, inquiry or
examination made for or on behalf of any party, or the knowledge of any party’s officers,
directors, stockholders, employees or agents or the acceptance by any party of any certificate or
opinion hereunder. The covenants and other agreements contained herein shall survive the Closing
and continue in full force and effect in accordance with their respective terms (subject to any
applicable statutes of limitations).

8.2 Indemnification Provisions for Benefit of the Buyer. In the event (i) either
Seller or the Parent breaches any of its representations or warranties contained herein or in any
certificate delivered by either Seller or the Parent pursuant to this Agreement and, if there is
an applicable survival period pursuant to Section 8.1 above, provided that the Buyer Party
makes a written claim for indemnification against the Seller pursuant to Section 11.7
below within such survival period, (ii) either Seller or Parent breaches or fails to fulfill any
covenant or agreement contained herein, (iii) of any action, demand, proceeding, investigation or
claim by any Person against or affecting the Target or any Buyer Party (as defined below) which,
if successful, would give rise to or evidence the existence of or relate to a breach of any of the
representations, warranties, covenants or agreements of the Parent or Seller under this Agreement;
(iv) of any liability for Indemnified Taxes of the Target or any of its Subsidiaries to the extent
not reflected in the Closing Balance Sheet and taken into account in determining the Final
Purchase Price; (v) of any Closing Indebtedness or Seller Expenses not reflected in the Closing
Balance Sheet or taken into account in determining the Final Purchase Price; (vi) any liability or
obligation relating to any environmental, health or safety matters (including without limitation
any arising under ISRA or any other Environmental Laws) with respect to the Specified Premises
other than to the extent of events or circumstances occurring after the Closing which are not
related to or caused by actions or omissions of Parent, Seller or any of their Subsidiaries,
including without limitation any liability or obligation relating to any environmental, health or
safety matters and arising in connection with (A) the Specified Lease, (B) the cessation of
operations at the Specified Premises and any associated liabilities arising under ISRA or other
Environmental Laws or under the Specified Lease, and (C) unless Target enters into a replacement
lease for the Specified Premises (other than amendments to its existing lease), any removal,
closure, cleanup or other remedial actions, including without limitation any such actions with
respect to any storage tanks currently or formerly located at the Specified Premises; (vii) of any
claim, suit, action, proceeding or investigation (whether civil, criminal, administrative or
investigative) arising out of or pertaining to matters existing or occurring at or prior to the
Closing with respect to any (A) matters which would have been covered by Parent or any of its
Subsidiaries directors and officers, employment practices (to the extent related to any period on
or prior to the Closing Date) or fiduciary liability policies if such claim were asserted prior to
the Closing (without regard to any deductibles or other limitations) or (B) actions or omissions
of the officers, senior officers or board of directors or governing body of the Company and its
Subsidiaries prior to the Closing, (viii) of any Indebtedness, obligation or other liability
related to or evidenced by that certain Uniform Commercial Code Financing Statement filed with the
Secretary of State of the State of New Jersey on June 2, 2002, filing number 2106652-8, in favor
of Fleet Capital Corporation, or (ix) of any of any action, demand, proceeding, investigation or
claim by any Person or any liability or obligation resulting, related to or in connection with
Target, Buyer, Parent and Seller not receiving a consent on terms reasonably satisfactory to Buyer
pursuant to the Specified License or any Adverse Consequences resulting, related to or in
connection with Parent, Seller and their Subsidiaries not performing any obligations such Persons
would have been required to perform under this Agreement, the Transition Services Agreement or any
other agreement if such consent with respect to the Specified License were obtained, then Parent
and the Seller shall, jointly and severally, indemnify the Buyer and its Affiliates (including the
Target after the Closing), stockholders, officers, directors, employees, agents, partners,
representatives, successors and assigns (collectively, the “Buyer Parties”) and save and hold each
of them harmless from and against and pay on behalf of or reimburse such Buyer Parties as and when
incurred for any Adverse Consequences any Buyer Party may suffer through and after the date of the
claim for indemnification as a result of, in connection with, or by virtue of such breach or right
to obtain indemnification. Parent and Seller shall not have any obligation to indemnify any Buyer
Party from and against any Adverse Consequences pursuant to clauses (i), (iii) or (vii) above
until the Buyer Parties have suffered Adverse Consequences by reason of any individual breaches,
or groups of breaches arising out of the same or similar facts, events or circumstances (but
solely with respect to the fourth sentence of Section 4.5, including only individual
breaches or groups of breaches arising out of the same event) (“Group of Related Breaches”), equal
to or exceeding Twenty-Five Thousand Dollars ($25,000) (“De Minimis”) and the sum of all such
breaches exceeds an aggregate deductible equal to Three Hundred Thousand Dollars ($300,000)
(“Deductible”) (after which point, with respect to indemnification pursuant to any of clauses (i),
(iii) or (vii) above, the Seller and Parent will be obligated only to indemnify the Buyer Parties
from and against such further Adverse Consequences in excess of the Deductible up to the Cap
proximately caused by reason of individual breaches or Groups of Related Breaches each equal to or
exceeding the De Minimis); provided, further, for the sole purpose of determining
the applicability and the amount of any Adverse Consequences that are the subject matter of a
indemnification claim hereunder, the Deductible and De Minimis shall be the materiality standard
for such purpose hereunder and, therefore, each representation and warranty contained in this
Agreement shall be read for such purpose (and no other purpose) without regard to and without
giving effect to any materiality or Material Adverse Effect standard or qualification contained in
such provision (as if such standard or qualification were deleted from such provision)). The
Parent and Seller will have no obligation to indemnify the Buyer Parties under this Agreement for
any Adverse Consequences caused by pursuant to clauses (i), (iii) or (vii) above in excess of Nine
Million Dollars ($9,000,000) (the “Cap”). The Deductible, De Minimis and Cap shall not apply to
indemnity claims arising from a breach or inaccuracy of the representations and warranties
contained in Section 3.1(a) (Organization of Parent and Seller), any of the first three
sentences of Section 3.1(b) (Authorization of Transaction), Section 3.1(d)
(Brokers’ Fees), Section 3.1(e) (Target Shares), the first sentence of Section 4.1
(Organization, Qualification and Corporate Power), Section 4.2 (Capitalization),
Section 4.4 (Brokers’ Fees), the first sentence of Section 4.5 (Title to Assets;
Asset Sufficiency), Section 4.6 (Subsidiaries), Section 4.7(c) (Financial Statements),
Section 4.10 (Tax Matters), Section 4.18 (Certain Business Relationships) and
4.27 (Closing Date) with respect to Section 3.1(a), any of the first three
sentences of Section 3.1(b), Section 3.1(d), Section 3.1(e), the first
sentence of Section 4.1, Section 4.2, Section 4.4, the first sentence of
Section 4.5, Section 4.6, Section 4.10 and Section 4.18, any
Adverse Consequences for which shall be indemnified in the aggregate from the first dollar up to a
maximum of the Purchase Price. Notwithstanding any other provision in this Agreement to the
contrary, Parent and Seller shall not be liable to the Buyer Parties for any (a) Adverse
Consequences that are punitive (except to the extent constituting third party punitive claims), or
(b) Adverse Consequences based upon “multiple of profits,” “multiple of earnings” or similar
valuation methodology (including without limitation any Adverse Consequences in the nature of
diminution in value of the Target Shares based upon or otherwise calculated in reference to any of
the foregoing items described in clause (b) above).

8.3 Indemnification Provisions for Benefit of the Seller. In the event (i) the
Buyer breaches any of its representations or warranties contained herein or in any certificate
delivered by the Buyer pursuant to this Agreement, and, if there is an applicable survival period
pursuant to Section 8.1 above, provided that the Seller makes a written claim for
indemnification against the Buyer pursuant to Section 11.7 below within such survival
period, (ii) or the Buyer breaches or fails to fulfill any covenant or agreement contained herein,
or (iii) of any action, demand, proceeding, investigation or claim by any Person against or
affecting any Seller Party (as hereinafter defined) which, if successful, would give rise to or
evidence the existence of or relate to a breach of any of the representations, warranties,
covenants or agreements of Buyer under this Agreement, then the Buyer shall indemnify Parent, the
Seller and their Affiliates, stockholders, officers, directors, employees, agents, partners,
representatives, successors and assigns (collectively, the “Seller Parties”) and save and hold
the Seller Parties harmless from and against and pay on behalf of or reimburse the Seller Parties
as and when incurred for any Adverse Consequences the Seller Parties may suffer through and after
the date of the claim for indemnification as a result of, in connection with, or by virtue of such
breach.

8.4 Matters Involving Third Parties.

(a) If any third party shall notify a Party (the “Indemnified Party”) with respect to any
matter (a “Third Party Claim”) which may give rise to a claim for indemnification against a other
Party (the “Indemnifying Party”) under this Article 8, then the Indemnified Party shall
promptly (and in any event within five business days after receiving notice of the Third Party
Claim) notify the Indemnifying Party thereof in writing; provided that the failure to so notify an
Indemnifying Party shall not relieve the Indemnifying Party of its obligations hereunder except to
the extent that (and only to the extent that) such failure shall have caused the damages for which
the Indemnifying Party is obligated to be greater than such damages would have been had the
Indemnified Party given the Indemnifying Party prompt notice hereunder.

(b) The Indemnifying Party will have the right (subject to the limitations below) at any time
to assume and thereafter conduct the defense of the Third Party Claim by appointing a recognized
and reputable counsel of its choice reasonably satisfactory to the Indemnified Party to be the
lead counsel in connection with such defense; provided, however, prior to the
Indemnifying Party assuming control of such defense it shall first verify to the Indemnified Party
in writing that such Indemnifying Party shall be fully responsible (with no reservation of any
rights) for all liabilities and obligations relating to such claim for indemnification; and
provided further, that:

(i) the Indemnified Party shall be entitled to participate in the defense of such claim
and to employ counsel of its choice for such purpose; provided that the fees
and expenses of such separate counsel shall be borne by the Indemnified Party (other than
any fees and expenses of such separate counsel that are incurred prior to the date the
Indemnifying Party effectively assumes control of such defense which, notwithstanding the
foregoing, shall be borne by the Indemnifying Party);

(ii) the Indemnifying Party shall not be entitled to assume control of such defense
(unless otherwise agreed to in writing by the Indemnified Party) and shall pay the fees and
expenses of counsel retained by the Indemnified Party if (1) the claim for indemnification
relates to or arises in connection with any criminal or quasi-criminal proceeding, action,
indictment, allegation or investigation; (2) the Indemnified Party reasonably believes an
adverse determination with respect to the action, lawsuit, investigation, proceeding or
other claim giving rise to such claim for indemnification would be materially detrimental to
or materially injure the Indemnified Party’s reputation or future business prospects;
(3) the claim seeks an injunction or equitable relief against the Indemnified Party; or (4)
the Indemnified Party has been advised by counsel that a reasonable likelihood exists of a
conflict of interest between the Indemnifying Party and the Indemnified Party; and

(iii) If the Indemnifying Party shall control the defense of a Third Party Claim, it
will not consent to entry of any judgment or enter into any settlement of a Third Party
Claim or cease to defend such claim without the prior written consent of the Indemnified
Party unless such judgment or proposed settlement or cessation involves or will result in
only the payment of money damages and will expressly and unconditionally release the
Indemnified Party from all liabilities and obligations with respect to such claim without
prejudice and will not result in or impose an injunction or other equitable relief upon the
Indemnified Party.

(c) Unless and until an Indemnifying Party assumes the defense of the Third Party Claim as
provided in Section 8.4(b) above, however, the Indemnified Party may defend against the
Third Party Claim in any manner it reasonably may deem appropriate; provided that
the Indemnified Party may not enter into any settlement of a Third Party Claim without the prior
written consent of the Indemnifying Party, which consent shall not be unreasonably withheld or
delayed.

(d) Certain Waivers; etc. Each of Parent and Seller hereby agree that it shall not
make any claim for indemnification against the Buyer, the Target or any of their respective
Affiliates by reason of the fact that the Parent or Seller are or were, directly or indirectly,
equityholders of the Target or any of its Subsidiaries (whether such claim is for judgments,
damages, penalties, fines, costs, amounts paid in settlement, losses, expenses or otherwise and
whether such claim is pursuant to any statute, charter document, bylaw, agreement or otherwise)
with respect to any action, suit, proceeding, complaint, claim or demand brought by any of the
Buyer Parties against the Seller or Parent pursuant to this Agreement or applicable law or
otherwise, and each of the Parent and Seller hereby acknowledges and agrees that it shall not have
any claim or right to contribution or indemnity from the Target or any of its Affiliates with
respect to any amounts paid by it pursuant to this Agreement or otherwise. Effective upon the
Closing, each of the Parent and Seller hereby irrevocably waives, releases and discharges the
Target and its Subsidiaries from any and all liabilities and obligations to it of any kind or
nature whatsoever, whether in its capacity as a stockholder of the Target or any of its
Subsidiaries or otherwise (including in respect of any rights of contribution or indemnification),
in each case whether absolute or contingent, liquidated or unliquidated, known or unknown, and
whether arising under any agreement or understanding (other than this Agreement and any of the
other agreements executed and delivered in connection herewith) or otherwise at law or equity, and
each of the Seller and Parent agrees that it shall not seek to recover any amounts in connection
therewith or thereunder from the Target or any of its Subsidiaries. In no event shall the Buyer,
Target or any of their respective Subsidiaries have any liability whatsoever to the Seller or
Parent for any breaches of the representations, warranties, agreements or covenants of the Target
hereunder, and in any event none of the Seller or Parent may seek contribution or indemnification
from the Buyer, Target or any of their respective Subsidiaries in respect of any payments required
to be made by either Seller or Parent pursuant to this Agreement.

8.5 Insurance Proceeds. To the extent that an indemnified party receives insurance
proceeds as a result of any Adverse Consequences, the indemnified party shall pay the amount of
such insurance proceeds to the indemnifying party promptly after such insurance proceeds are
actually received by the indemnified party less the sum of (i) any costs incurred in the
collection thereof, (ii) any amounts actually paid by the indemnified party as a result of such
Adverse Consequences as premiums retroactively assessed under any applicable provisions of
insurance policies that cover such Adverse Consequences (in whole or in part) and (iii) the
present value of any increases in insurance premiums on account of such Adverse Consequences, in
the cases of clauses (ii) and (iii) above as identified by the applicable insurance company as
relating to such Adverse Consequences or as otherwise reasonably apparent; provided that (i) the
indemnifying party shall not be entitled to any such net insurance proceeds in excess of the
indemnification payment or payments actually received from the indemnifying party by the
indemnified party with respect to such Adverse Consequences, and (ii) the indemnifying party shall
only be entitled to such net insurance proceeds to the extent of any amounts actually received
from the indemnifying party by the indemnified party with respect to such Adverse Consequences
plus the amount of such insurance proceeds exceed the amount of such Adverse Consequences to the
indemnified party. At the request of the indemnifying party, the indemnified party shall use
commercially reasonable efforts to make a claim against its insurance carrier with respect to such
Adverse Consequences (but shall not be obligated to take any other action, including without
limitation commencing or threatening a lawsuit) unless the indemnified party reasonably believes
that submission of such a claim could cause (x) the premiums of such Person’s insurance policy to
be materially increased or (y) the insurance carrier to cancel any insurance policy.

8.6 Exclusive Remedy. The Buyer and the Seller acknowledge and agree that the
foregoing indemnification provisions in this Article 8 and in Article 10, shall be
the exclusive remedy of the Buyer and the Parent and Seller with respect to claims for monetary
relief with respect to the transactions contemplated by this Agreement, except for any Adverse
Consequences incurred as a result of fraud of any Party. In furtherance of the foregoing, each
Party hereby waives, to the fullest extent permitted under applicable law, any and all other
rights, claims and causes of action it may have, from and after the Closing, against the other
Party hereto relating to the subject matter of this Agreement except as set forth in the preceding
sentence. Notwithstanding any provision to the contrary, nothing in this Section 8.6 shall
restrict any Party’s ability to seek equitable or injunctive relief, including specific
performance. Neither Party shall have any liability to the other for any punitive damages;
provided, however, that this exclusion of punitive damages does not apply to any
such damages sought by third parties against an Indemnified Party in connection with Adverse
Consequences that may be indemnified pursuant to this Article 8 in connection with a Third
Party Claim; provided, further, that all such punitive damages shall nevertheless
remain subject to the limitations on the Parties’ indemnification obligations provided in this
Article 8, including the Deductible, De Minimis and Cap (to the extent such limitations
are otherwise applicable to such Third Party Claim).

8.7 Environmental Matters. Without limiting the generality of Section 8.6, above,
the Buyer understands and agrees that its right to indemnification under Section 8.2 shall
constitute its sole and exclusive remedy against the Seller with respect to any claims for
monetary relief with respect to environmental, health, or safety matter relating to the past,
current or future facilities, properties or operations of the Target, its Subsidiaries, and all of
their respective predecessors or Affiliates, including without limitation any such matter arising
under any Environmental, Health, and Safety Requirements. Aside from their respective rights to
indemnification as set forth in this Agreement, the Buyer, Parent and the Seller hereby waive any
right to seek contribution, cost recovery, damages, or any other recourse or remedy and hereby
release each other from any claim, demand or liability with respect to any environmental, health,
or safety matter arising at law or in equity, including without limitation any arising under any
Environmental, Health, and Safety Requirements and including without limitation any arising under
the Comprehensive Environmental Response, Compensation, and Liability Act, any analogous state
law, or the common law.

8.8 Manner of Payment. Except as otherwise provided herein, any indemnification of
the Buyer Parties or the Seller Parties pursuant to this Article 8 shall be effected by wire
transfer of immediately available funds from the Parent and Seller (jointly and severally) or
Buyer, as the case may be, to an account(s) designated by the applicable Buyer Party or Seller
Party, as the case may be, within two business days after the final determination thereof. Any
such indemnification payments shall include interest at the Applicable Rate calculated on the
basis of the actual number of days elapsed over 360, from the date any such Adverse Consequences
are suffered or sustained until the date of payment. Notwithstanding any provision to the contrary
in this Section 8.9, (a) the Buyer Parties shall be entitled to (but shall not be required
to) set-off any amounts due or payable to any of the Buyer Parties by Parent, Seller or any of
their respective Subsidiaries pursuant to this Section 8.9 against any amounts otherwise
due and payable by any of the Buyer Parties or any of their Affiliates to Parent, the Seller or
any of their respective Subsidiaries and (b) the Seller Parties shall be entitled to (but shall
not be required to) set-off any amounts due or payable to any of the Seller Parties by Buyer
pursuant to this Section 8.9 against any amounts otherwise due and payable by any of the
Seller Parties to Buyer or any of its Subsidiaries. All indemnification payments under this
Section 8.7 shall be deemed adjustments to the Purchase Price set forth in Section 2.3(a)
above. 

8.9 Obligations of Parent and the Seller. Notwithstanding any provision in this
Agreement, all obligations of either Parent or the Seller are joint and several obligations of
Parent and the Seller.

ARTICLE 9

Termination

9.1 Termination of Agreement. The Parties may terminate this Agreement as provided
below:

(a) the Buyer and the Seller may terminate this Agreement by mutual written consent at any
time prior to the Closing;

(b) the Buyer may terminate this Agreement by giving written notice to the Seller at any time
prior to the Closing (i) in the event that any of Parent, the Seller or Target has breached any
representation, warranty, or covenant contained in this Agreement in any material respect, which in
the case of any breach of covenant which is curable has not been cured within ten days after
written notification thereof by Buyer to Seller or (ii) if the Closing shall not have occurred on
or before June 30, 2006 (the “Outside Date”), by reason of the failure of any condition precedent
under Section 7.1 hereof (unless the failure results primarily from the Buyer itself
breaching any representation, warranty, or covenant contained in this Agreement); provided,
however, that if the only conditions not fulfilled by such date are the receipt of required
approvals from governmental authorities of competent jurisdiction, then the Outside Date shall be
extended by an additional ten (10) days and Buyer may not terminate this Agreement under
Section 9.1(b)(ii) prior to the Outside Date as extended; and

(c) the Seller may terminate this Agreement by giving written notice to the Buyer at any time
prior to the Closing (i) in the event the Buyer has breached any material representation, warranty,
or covenant contained in this Agreement in any material respect, which in the case of any breach of
covenant which is curable has not been cured within ten days after written notification thereof by
the Seller to Buyer or (ii) if the Closing shall not have occurred on or before the Outside Date by
reason of the failure of any condition precedent under Section 7.2 hereof (unless the
failure results primarily from the Seller breaching any representation, warranty, or covenant
contained in this Agreement); provided, however, that if the only conditions not
fulfilled by such date are the receipt of required approvals from governmental authorities of
competent jurisdiction, then the Outside Date shall be extended by an additional the (10) days and
Seller may not terminate this Agreement under Section 9.1(c)(ii) prior to the Outside Date
as extended.

9.2 Effect of Termination. If any Party terminates this Agreement pursuant to
Section 9.1 above, all rights and obligations of the Parties hereunder shall terminate and
have no further force or effect except that (a) the covenants and agreements set forth in this
Section 9.2, Section 11.13 (Expenses), Section 11.6 (Specific
Performance), and Article 11 (Miscellaneous) shall survive such termination indefinitely,
and (b) nothing in Section 9.1 or this Section 9.2 shall be deemed to release any
Party from any liability for any breach by such party of the terms and provisions of this
Agreement prior to the date hereof or to impair the right of Buyer to compel specific performance
by another party of its obligations under this Agreement.

ARTICLE 10

Tax Matters

10.1 Tax Sharing Agreements. Any tax sharing agreement between Parent and any of the
Target and its Subsidiaries is terminated as of the Closing Date and will have no further effect
for any taxable year (whether the current year, a future year or a past year).

10.2 Returns for Periods Through the Closing Date. Parent shall include the income
of the Target and its Subsidiaries (including any deferred income triggered into income by
Treasury Reg. § 1.1502-13 and any excess loss accounts taken into income under Treasury Reg. §
1.1502-19) on the Parent consolidated federal income Tax Returns for all periods through the
Closing Date and pay any federal income Taxes attributable to such income. For all taxable
periods ending on or before the Closing Date, Parent shall cause Target and its Subsidiaries to
join in Parent’s consolidated federal income tax return and pay any Federal Income Taxes
attributable to such income. The Target and its Subsidiaries will furnish Tax information to
Parent for inclusion in Parent’s federal consolidated income Tax Return for the period which
includes the Closing Date in accordance with the Target’s past custom and practice. The income of
the Target and its Subsidiaries will be apportioned to the period up to and including the Closing
Date and the period after the Closing Date by closing the books of the Target and its Subsidiaries
as of the end of the Closing Date.

10.3 Intentionally Omitted.

10.4 Intentionally Omitted.

10.5 Post-Closing Elections. At Parent’s request, the Buyer will cause any of the
Target and its Subsidiaries to make and/or join with Parent in making such Tax elections that
Parent may request after Closing if the making of such election does not have a material adverse
impact on the Buyer (or any of the Target and its Subsidiaries) for any post-acquisition Tax
period.

10.6 Indemnification for Post-Closing Transactions. The Buyer agrees to indemnify the
Seller for any additional Tax owed by the Seller (including Tax owed by the Seller due to this
indemnification payment) resulting from any transaction that is both (a) not contemplated by this
Agreement and (b) does not take place in the ordinary course of business occurring on the Closing
Date after the Buyer’s purchase of the Target Shares.

10.7 Section 338(h)(10) Election. Parent will join with the Buyer in making an
election under Section 338(h)(10) of the Code in connection with the purchase and sale of the
stock of Target and any of its Subsidiaries hereunder (and any corresponding elections under
state, local, or foreign tax law) (collectively, a “Section 338(h)(10) Election”). Parent will
pay any Tax attributable to the making of the Section 338(h)(10) Election and will indemnify
Buyer, Target, and Target’s Subsidiaries against any Adverse Consequences arising out of any
failure to pay such Tax. Buyer shall prepare or cause to be prepared and file or cause to be
filed the Section 338(h)(10) Election. Buyer shall permit Parent to review and comment on the
Section 338(h)(10) Election prior to filing and shall make such revisions to the Section
338(h)(10) Election as are reasonably requested by Parent. Parent and the Seller will include any
income, gain, loss, deduction or other tax item resulting from the Section 338(h)(10) Election on
their Tax Returns to the extent required by applicable law.

10.8 Cooperation on Tax Matters.

(a) Buyer, Target and its Subsidiaries, Parent and the Seller shall cooperate fully, as and
to the extent reasonably requested by the other Party, in connection with the filing of Tax
Returns pursuant to this Section 10.8 and any audit, litigation or other proceeding with
respect to Taxes. Such cooperation shall include the retention and (upon the other Party’s
request) the provision of records and information that are reasonably relevant to any such audit,
litigation or other proceeding and making employees available on a mutually convenient basis to
provide additional information and explanation of any material provided hereunder. Target and its
Subsidiaries, Parent and the Seller agree (A) to retain all books and records with respect to Tax
matters pertinent to Target and its Subsidiaries relating to any taxable period beginning before
the Closing Date until the expiration of the statute of limitations (and, to the extent notified
by Buyer or the Seller, any extensions thereof) of the respective taxable periods, and to abide by
all record retention agreements entered into with any taxing authority, and (B) to give the other
Party reasonable written notice prior to transferring, destroying or discarding any such books and
records and, if the other Party so requests, Target and its Subsidiaries or Parent or the Seller,
as the case may be, shall allow the other Party to take possession of such books and records.

(b) Buyer, Parent and the Seller further agree, upon request, to provide the other Party with
all information that either Party may be required to report pursuant to Code §6043, or Code §6043A,
or Treasury Regulations promulgated thereunder.

ARTICLE 11

Miscellaneous

11.1 Press Releases and Public Announcements. Prior to the Closing, no Party shall
issue any press release or make any announcement to the employees, customers or suppliers of
Target or any of its Subsidiaries or any other public announcement relating to the subject matter
of this Agreement without the prior written approval of the Buyer and the Seller;
provided, however, that any Party may make any public disclosure it believes in
good faith is required by applicable law or any listing or trading agreement concerning its
publicly-traded securities (in which case the disclosing Party will use its commercially
reasonable efforts to consult with the other Parties prior to making the disclosure as to its
form and content). After the Closing, Buyer and the Target may disclose such information without
the consent of any other Party.

11.2 Third-Party Beneficiaries. This Agreement shall not confer any rights or
remedies upon any Person other than the Parties and each of their respective successors and
permitted assigns.

11.3 Entire Agreement. This Agreement (including the documents referred to herein
and the attachments hereto) constitutes the entire agreement among the Parties and supersedes any
prior understandings, agreements, or representations by or among the Parties, written or oral, to
the extent they have related in any way to the subject matter hereof, including without limitation
the Confidentiality Agreement.

11.4 Succession and Assignment. This Agreement shall be binding upon and inure to
the benefit of the Parties named herein and their respective successors and permitted assigns. No
Party may assign either this Agreement or any of its rights, interests, or obligations hereunder
without the prior written approval of the Buyer and the Seller; provided that
Buyer may assign its rights and obligations hereunder (including its right to purchase the Target
Shares), in whole or in part, to any of its Affiliates without the consent of any of the other
Parties hereto. In addition, after the Closing Buyer may assign its rights and obligations
pursuant to this Agreement, in whole or in part, in connection with any disposition or transfer of
all or any portion of Target or any of its Subsidiaries or their respective businesses without the
consent of any of the other Parties hereto. Notwithstanding any provision to the contrary in this
Agreement, Buyer and, following the Closing, Target and its Subsidiaries may assign any or all of
its rights, title and interest in and pursuant to this Agreement and any of the other agreements
executed and delivered in connection herewith, including its rights to indemnification or payment
thereunder, to any of its lenders as collateral security.

11.5 Counterparts. This Agreement may be executed in one or more counterparts, each
of which shall be deemed an original but all of which together will constitute one and the same
instrument.

11.6  Specific Performance. The Parties each agree that irreparable damage would
occur in the event any provision of this Agreement was not performed by the other Party in
accordance with the terms hereof and that the non-breaching Party shall be entitled to specific
performance of the terms hereof, in addition to any other remedy at law or equity.

11.7 Notices. All notices, requests, demands, claims, and other communications
hereunder will be in writing. Any notice, request, demand, claim, or other communication
hereunder shall be deemed duly given if (and then two business days after) it is sent by
registered or certified mail, return receipt requested, postage prepaid, and addressed to the
intended recipient as set forth below:

	 	 	 
	If to the Buyer:

	 	Copy to:
	 

	 	 
	c/o Sun Capital Partners, Inc.

5200 Town Center Circle, Suite 470

Boca Raton, FL 33486

Attn: Jason Neimark

Shigeru Utsugi

	 	Kirkland & Ellis

200 East Randolph

Chicago, IL 60601

Attn: Jeffrey A. Fine

Telecopy: (312) 861-2200

Aaron Wolfe

C. Deryl Couch

Telecopy: (561) 394-0540

	 	 	 	 	 
	If to Parent or the Seller:
	 	Copy to:

	 
	 	 	 	 
	Saia Motor Freight Line, Inc.
	 	Bryan Cave LLP

	11465 Johns Creek Parkway
	 	3500 One Kansas City Place
	Duluth, Georgia 30097
	 	1200 Main Street
	Attention: President
	 	Kansas City, Missouri 64105

	 
	 	Attention:  Robert M. Barnes

Any Party may send any notice, request, demand, claim, or other communication hereunder to the
intended recipient at the address set forth above using any other means (including personal
delivery, expedited courier, messenger service, telecopy, telex, ordinary mail, or electronic
mail), but no such notice, request, demand, claim, or other communication shall be deemed to have
been duly given unless and until it actually is received by the intended recipient. Any Party may
change the address to which notices, requests, demands, claims, and other communications hereunder
are to be delivered by giving the other Parties notice in the manner herein set forth.

11.8 Governing Law. This Agreement shall be governed by and construed in accordance
with the domestic laws of the State of Delaware without giving effect to any choice or conflict of
law provision or rule (whether of the State of Delaware or any other jurisdiction) that would
cause the application of the laws of any jurisdiction other than the State of Delaware.

11.9 Jurisdiction and Consent to Service of Process. The parties agree that any
legal action, suit or proceeding arising out of or relating to this Agreement or the transactions
contemplated hereby shall be instituted in a Federal or state court sitting in the County of
Newcastle, Delaware, which shall be the jurisdiction and venue of said legal proceedings, and each
party hereto waives any objection that such party may now or hereafter have to the laying of venue
of any such action, suit or proceeding, and irrevocably submits to the jurisdiction of any such
court in any such action, suit or proceeding. Any and all service of process or any other notice
in any such action, suit or proceeding shall be effective against such party when transmitted in
accordance with Section 11.7 of this Agreement. Nothing contained herein shall be deemed
to affect the right of either Party to serve process in any manner permitted by law.

11.10 WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ANY
AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATED TO THIS AGREEMENT
OR THE TRANSACTIONS CONTEMPLATED HEREBY.

11.11 Amendments and Waivers. No amendment of any provision of this Agreement shall
be valid unless the same shall be in writing and signed by the Buyer and the Seller. No waiver by
any Party of any default, misrepresentation, or breach of warranty or covenant hereunder, whether
intentional or not, shall be deemed to extend to any prior or subsequent default,
misrepresentation, or breach of warranty or covenant hereunder or affect in any way any rights
arising by virtue of any prior or subsequent such occurrence.

11.12 Severability. Any term or provision of this Agreement that is invalid or
unenforceable in any situation in any jurisdiction shall not affect the validity or enforceability
of the remaining terms and provisions hereof or the validity or enforceability of the offending
term or provision in any other situation or in any other jurisdiction.

11.13 Expenses. Each of the Buyer, on the one hand, and Parent and the Seller, on
the other hand, will bear their own costs and expenses (including legal fees and expenses and the
fees of any investment bankers, brokers or other representatives or consultants) incurred in
connection with the negotiation of and performance under this Agreement and the transactions
contemplated hereby. In addition, the Seller and Parent shall, jointly and severally, pay all
fees, costs and expenses of the Target incurred in connection with the negotiation of and
performance under this Agreement and the transactions contemplated hereby, including the Seller
Expenses, and the Target shall not pay any fees, costs or expenses of Seller, the Target or any of
their Affiliates arising in connection with the transactions contemplated hereby if the
transactions are consummated, except to the extent any such expenses have been included as Closing
Seller Expenses on the final Closing Balance Sheet and have actually reduced the Purchase Price.
All transfer, documentary, sales, use, stamp, registration and other such Taxes, all conveyance
fees, recording charges and other fees and charges (including any penalties and interest) incurred
in connection with the consummation of the transactions contemplated by this Agreement, and all
Surveys, Title Commitments and Title Policies shall be paid one-half by Buyer, on the one hand,
and one-half by Parent and Seller, on a joint and several basis, on the other hand.

11.14 Exhibits/Schedules. The Disclosure Schedule to this Agreement are hereby
incorporated and made a part hereof and are an integral part of this Agreement. Any information
set forth in any one Section of the Disclosure Schedule shall be considered to have been disclosed
solely for purposes of the correspondingly numbered representation or warranty or other section or
subsection in this Agreement, except to the extent that the relevance of a disclosure in one
Section of the Disclosure Schedule to another Section of the Disclosure Schedule is reasonably
apparent on its face.

11.15 Construction. The Parties have participated jointly in the negotiation and
drafting of this Agreement. In the event an ambiguity or question of intent or interpretation
arises, this Agreement shall be construed as if drafted jointly by the Parties and no presumption
or burden of proof shall arise favoring or disfavoring any Party by virtue of the authorship of
any of the provisions of this Agreement. Any reference to any federal, state, local, or foreign
statute or law shall be deemed also to refer to such federal, state, local or foreign statute or
law including all amendments thereto and all rules and regulations promulgated thereunder, in each
case as in effect on the date hereof, unless the context requires otherwise. As used herein,
unless the context otherwise requires: (a) references to “Article” or “Section” are to an article
or section hereof; (b) all “Exhibits” and “Schedules” referred to herein are to exhibits and
schedules attached hereto and are incorporated herein by reference and made a part hereof; (c) the
headings of the various articles, sections and other subdivisions hereof are for convenience of
reference only and shall not modify, define or limit any of the terms or provisions hereof; (d)
“including” means including but not limited to; (e) the singular number includes the plural number
and vice versa; (f) reference to any gender includes each other gender; (g) “hereunder,” “hereof,”
“hereto” and words of similar import shall be deemed references to this Agreement as a whole and
not to any particular provision or other provision hereof; (h) relative to the determining of any
period of time, “from” means “from and including” and “to” and “through” mean “to and including”;
and (i) “or”, “either” and “any” are not exclusive.

****

2

IN WITNESS WHEREOF, the Parties hereto have executed this Agreement on the date first above
written.

JEVIC HOLDING CORP.

	 	 	 
	By:/s/ Aaron Wolfe

	 	

	 
	 	 
	 

	 
	 	 
	Printed Name:

	 	Aaron Wolfe
	
 
	 	 
	Title:

	 	Vice President
	 

	 	 

	 	 	SAIA MOTOR FREIGHT LINE, INC.

	 	 	 
	By:/s/ Richard D. O’Dell

	 	

	 
	 	 
	 

	 
	 	 
	Printed Name:

	 	Richard D. O’Dell
	
 
	 	 
	Title:

	 	President & CEO
	 

	 	 

	 	 	SCS TRANSPORTATION, INC.

	 	 	 
	By:/s/ Herbert A. Trucksess III

	 
	 	 
	 

	 
	 	 
	Printed Name:

	 	Herbert A. Trucksess III
	
 
	 	 
	Title:

	 	President
	 

	 	 
	 
	 	 

3

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