Document:

exv10w1

 

EXHIBIT 10.1

 

SECURITIES PURCHASE AGREEMENT

among

IDEX CORPORATION,

the Sellers party hereto,

and

CVI LASER, LLC

Dated as of May 10, 2011

 

 

 

TABLE OF CONTENTS

	 	 	 

	ARTICLE I PURCHASE AND SALE
	 	3
	1.01 CALCULATION OF PURCHASE PRICE
	 	3
	1.02 PURCHASE AND SALE OF SECURITIES
	 	3
	1.03 ASSUMPTION OF CERTAIN LIABILITIES
	 	3
	1.04 THE CLOSING; PAYMENT FOR UNITS, INDEBTEDNESS AND COMPANY TRANSACTION EXPENSES; TAX BENEFITS
	 	3
	1.05 FINAL CASH ON HAND, NET WORKING CAPITAL AND INDEBTEDNESS CALCULATIONS
	 	4
	1.06 ESCROW AMOUNT
	 	5
	ARTICLE II CONDITIONS TO CLOSING; DELIVERIES
	 	6
	2.01 CONDITIONS TO EACH PARTY’S OBLIGATION
	 	6
	2.02 CONDITIONS TO BUYER’S OBLIGATIONS
	 	6
	2.03 CONDITIONS TO SELLERS’ AND THE COMPANY’S OBLIGATIONS
	 	6
	2.04 DELIVERIES
	 	7
	ARTICLE III REPRESENTATIONS AND WARRANTIES OF EACH SELLER
	 	7
	3.01 AUTHORITY
	 	7
	3.02 EXECUTION AND DELIVERY; VALID AND BINDING AGREEMENT
	 	7
	3.03 OWNERSHIP OF THE UNITS
	 	8
	3.04 NO CONFLICT OR VIOLATION
	 	8
	3.05 LITIGATION
	 	8
	3.06 BROKERAGE
	 	8
	ARTICLE IV REPRESENTATIONS AND WARRANTIES OF THE COMPANY
	 	8
	4.01 ORGANIZATION AND ORGANIZATIONAL POWER
	 	8
	4.02 SUBSIDIARIES
	 	8
	4.03 AUTHORIZATION; VALID AND BINDING AGREEMENT; NO BREACH; CONSENTS
	 	8
	4.04 CAPITALIZATION AND RELATED MATTERS
	 	9
	4.05 FINANCIAL STATEMENTS
	 	9
	4.06 ABSENCE OF CERTAIN DEVELOPMENTS
	 	10
	4.07 TITLE TO PROPERTIES; TANGIBLE ASSETS
	 	11
	4.08 TAX MATTERS
	 	12
	4.09 CONTRACTS AND COMMITMENTS
	 	12
	4.10 INTELLECTUAL PROPERTY
	 	13
	4.11 LITIGATION
	 	14
	4.12 EMPLOYEE BENEFIT PLANS
	 	14
	4.13 INSURANCE
	 	15
	4.14 COMPLIANCE WITH LAWS, EXPORT CONTROLS, IMPORT LAWS, FOREIGN
CORRUPT PRACTICES ACT, AND OTHER APPLICABLE ANTI-BRIBERY/ANTI-CORRUPTION
LAWS
	 	15
	4.15 ENVIRONMENTAL MATTERS
	 	16
	4.16 AFFILIATED TRANSACTIONS
	 	16
	4.17 EMPLOYEES
	 	17
	4.18 BROKERAGE
	 	17
	4.19 GOVERNMENTAL LICENSES AND PERMITS
	 	17
	4.20 CUSTOMERS AND SUPPLIERS
	 	17
	4.21 ACCOUNTS RECEIVABLE
	 	18
	4.22 INVENTORY
	 	18
	4.23 PRODUCT WARRANTY
	 	18
	4.24 NO OTHER REPRESENTATIONS
	 	18
	ARTICLE V REPRESENTATIONS AND WARRANTIES OF BUYER
	 	18
	5.01 ORGANIZATION AND AUTHORITY
	 	18
	5.02 AUTHORIZATION; VALID AND BINDING AGREEMENT
	 	18
	5.03 NO BREACH
	 	18
	5.04 LITIGATION
	 	19
	5.05 INVESTMENT
	 	19
	5.06 BROKERAGE
	 	19
	5.07 KNOWLEDGE OF BUYER
	 	19
	5.08 NO OTHER REPRESENTATIONS
	 	19
	ARTICLE  VI
PRE-CLOSING COVENANTS
	 	19
	6.01 CONDUCT OF BUSINESS
	 	19
	6.02 ACCESS TO BOOKS AND RECORDS
	 	19
	6.03 CONSENTS
	 	20
	6.04 EXCLUSIVITY
	 	20
	6.05 DATA ROOM MATERIALS
	 	20
	6.06 UPDATES TO SCHEDULE 4.04
	 	20
	6.07 REMAINING DUE DILIGENCE
	 	20
	ARTICLE VII ADDITIONAL COVENANTS
	 	20
	7.01 ACCESS TO BOOKS AND RECORDS
	 	20
	7.02 DIRECTOR AND OFFICER LIABILITY AND INDEMNIFICATION
	 	21
	7.03 REGULATORY FILINGS
	 	21
	7.04 CONDITIONS
	 	22

i

 

	 	 	 

	7.05 CONTACT WITH CUSTOMERS AND SUPPLIERS
	 	22
	7.06 EMPLOYEE BENEFITS
	 	22
	7.07 PAYMENT OF DIVIDEND
	 	23
	7.08 CONFIDENTIALITY
	 	23
	7.09 USE OF CORPORATE NAME OR TRADE NAME
	 	23
	ARTICLE VIII TERMINATION
	 	24
	8.01 TERMINATION
	 	24
	8.02 EFFECT OF TERMINATION
	 	24
	ARTICLE IX INDEMNIFICATION
	 	24
	9.01 SURVIVAL OF REPRESENTATIONS AND WARRANTIES
	 	24
	9.02 INDEMNIFICATION FOR THE BENEFIT OF BUYER
	 	24
	9.03 INDEMNIFICATION FOR THE BENEFIT OF THE SELLERS
	 	25
	9.04 SPECIAL RULE FOR FRAUD
	 	26
	9.05 MANNER OF PAYMENT
	 	26
	9.06 DEFENSE
OF THIRD-PARTY CLAIMS
	 	26
	9.07 DETERMINATION OF LOSS AMOUNT
	 	27
	9.08 TERMINATION OF INDEMNIFICATION
	 	27
	9.09 LIMITATION ON RECOURSE
	 	27
	9.10 CHARACTERIZATION OF PAYMENTS
	 	27
	ARTICLE X SELLER REPRESENTATIVE
	 	28
	10.01 DESIGNATION
	 	28
	10.02 AUTHORITY
	 	28
	10.03 AUTHORITY; INDEMNIFICATION
	 	28
	10.04 SELLER REPRESENTATIVE HOLDBACK
	 	28
	10.05 EXCULPATION
	 	29
	10.06 SURVIVAL
	 	29
	ARTICLE XI ADDITIONAL COVENANTS AND AGREEMENTS
	 	29
	11.01 DISCLOSURE GENERALLY
	 	29
	11.02 ACKNOWLEDGMENTS BY BUYER
	 	29
	11.03 TAX MATTERS
	 	30
	11.04 WARN
	 	32
	11.05 FURTHER ASSURANCES
	 	32
	ARTICLE XII DEFINITIONS
	 	32
	12.01 DEFINITIONS
	 	32
	12.02 CROSS-REFERENCE OF OTHER DEFINITIONS
	 	35
	ARTICLE XIII MISCELLANEOUS
	 	37
	13.01 PRESS RELEASES AND COMMUNICATIONS
	 	37
	13.02 EXPENSES
	 	37
	13.03 KNOWLEDGE DEFINED
	 	37
	13.04 NOTICES
	 	37
	13.05 ASSIGNMENT
	 	38
	13.06 SEVERABILITY
	 	38
	13.07 REFERENCES
	 	38
	13.08 NO STRICT CONSTRUCTION
	 	38
	13.09 AMENDMENT AND WAIVER
	 	38
	13.10 COMPLETE AGREEMENT
	 	38
	13.11 COUNTERPARTS
	 	38
	13.12 WAIVER OF JURY TRIAL
	 	38
	13.13 SPECIFIC PERFORMANCE
	 	38
	13.14 GOVERNING LAW; CONSENT TO JURISDICTION
	 	39
	13.15 LEGAL REPRESENTATION; CONFLICT WAIVER ACKNOWLEDGEMENT
	 	39

Exhibits

Exhibit A: Form of Escrow Agreement

Exhibit B: Form of Disbursing Agent Agreement

Exhibit C: Allocation Methodology

ii

 

SECURITIES PURCHASE AGREEMENT

THIS SECURITIES PURCHASE AGREEMENT (the “Agreement”) dated as of May 10, 2011, is made by
and among IDEX Corporation, a Delaware corporation (“Buyer”), CVI Laser, LLC, a Delaware
limited liability company (the “Company”), the Persons listed on the signature pages hereto
under the heading “Sellers” (collectively referred to herein as “Sellers” and individually
as a “Seller”), and Norwest Equity Partners VII, LP, as the  Seller
Representative (as such term is defined in Section X.A of this Agreement). Capitalized
terms used and not otherwise defined herein have the meanings set forth in XII.

RECITALS

WHEREAS, Sellers collectively own all of the issued and outstanding Class A Units and Class B Units
(collectively, the “Units”) of the Company as of the date of this Agreement.

WHEREAS, upon the terms and subject to the conditions set forth herein, Buyer desires to acquire
from Sellers, and Sellers desire to sell to Buyer, all of the Units which are issued and
outstanding and owned by Sellers as of the Closing Date.

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

I. 

PURCHASE AND SALE

     A. Calculation of Purchase Price.

     1. At least three Business Days prior to the Closing Date, the Company shall deliver
to Buyer a certificate (the “Closing Payment Certificate”) setting forth (i) its good faith
estimate of Cash On Hand (such estimate is referred to as the “Estimated Cash On Hand”),
(ii) its good faith estimate of the Net Working Capital Amount (such estimate is referred to as the
“Estimated Net Working Capital Amount”), (iii) its good faith estimate of the Closing Date
Indebtedness (such estimate is referred to as the “Estimated Closing Date Indebtedness”),
(iv) the aggregate amount of Company Transaction Expenses, (v) the Transaction Payment Amount and
(vi) wire instructions for the accounts to which funds are to be wired.

     2. For purposes hereof, the “Purchase Price” means an amount equal to (A)
$400,000,000, plus (B) the Estimated Cash On Hand (which amount may be negative),
minus (C) the Estimated Closing Date Indebtedness, plus (D) the amount, if any, by
which the Estimated Net Working Capital Amount exceeds the Target Net Working Capital Amount,
minus (E) the amount, if any, by which the Target Net Working Capital Amount exceeds the
Estimated Net Working Capital Amount, minus (F) without duplication, the aggregate amount,
if any, of Company Transaction Expenses to be paid by Buyer at the Closing (as detailed in the
Closing Payment Certificate), minus (G) the Transaction Payment Amount, minus (H)
the Escrow Amount, minus (I) the Seller Representative Holdback.

     B. Purchase and Sale of Securities. As of the Closing, upon the terms and subject to the
conditions set forth in this Agreement, each Seller shall sell, assign, transfer and convey to
Buyer, and Buyer shall purchase and acquire from each Seller, all of the Units held by such Seller
as such ownership is set forth on Schedule IV.D. The consideration to be paid to each
Seller in exchange for such Seller’s Units shall be an amount of cash equal to such Seller’s
allocable share of the Purchase Price as set forth on Schedule B (which Schedule B
shall be updated at and as of the Closing), which shall be subject to adjustment in accordance with
Section E hereof. At the Closing, Buyer shall pay to the Disbursing Agent on behalf of
Sellers an amount equal to the Purchase Price by wire transfer of immediately available funds so
that the Disbursing Agent can pay such cash to each Seller pursuant to the terms of the Disbursing
Agent Agreement.

     C. Assumption of Certain Liabilities. Notwithstanding anything to the contrary herein, the
parties hereto acknowledge and agree: (a) that the liabilities and other obligations set forth on
Schedule I.C (the “Assumed Liabilities”) are known to Buyer and shall continue to
be liabilities and obligations of the Company and its Subsidiaries from and after the Closing, (b)
that the amounts of the Assumed Liabilities set forth on Schedule I.C reflect the Company’s
estimate of the amounts of such Assumed Liabilities as of the date hereof (or, if otherwise
indicated on such Schedule I.C, as of the date so indicated), (c) that the actual amount of
such Assumed Liabilities as of the date hereof (or such otherwise indicated date), both on an
individual and aggregate basis, may differ from the actual amounts thereof both as of the date of
such estimate and, if different, as of the date hereof, and, additionally, such amounts may change
over time and (d) that in no event shall the Assumed Liabilities, or any variations to or changes
in the amounts of the 
Assumed Liabilities (including as between estimated amounts and actual amounts), be
subject to any purchase price adjustment under Section I.E, indemnification under
IX, or any other recourse against any Seller pursuant to the terms of this Agreement.

     D. The Closing; Payment for Units, Indebtedness and Company Transaction Expenses; Tax
Benefits.

3

 

     1. The closing of the transactions contemplated by this Agreement (the
“Closing”) shall take place at the offices of Latham & Watkins LLP located at 355 South
Grand Avenue, Los Angeles, California 90071 at 10:00 a.m. (Albuquerque time) on the second Business
Day following satisfaction or waiver of all of the closing conditions set forth in II
(other than those to be satisfied at the Closing) or on such other date as is mutually agreeable to
Buyer and the Seller Representative. The date on which the Closing shall occur is referenced
herein as the “Closing Date”.

     2. Upon the terms and subject to the conditions set forth in this Agreement, the
parties hereto shall consummate the following transactions as of the Closing: 

          Buyer shall deliver the Purchase Price to the Disbursing Agent in accordance with
Section B in exchange for the Units held by each Seller; 

          Buyer shall deliver the Escrow Amount to the Escrow Agent in accordance with
Section I.F;

          Buyer shall repay, or cause to be repaid, on behalf of the Company and its
Subsidiaries, the Indebtedness of the Company and its Subsidiaries set forth on Schedule
0, in each case, in such amounts as are then outstanding as of immediately prior to the
Closing in accordance with the terms thereof (and to the extent available, any payoff
letters with respect thereto), by wire transfer of immediately available funds (the
“Indebtedness Payoff Amount”); provided, however, that
notwithstanding its inclusion on Schedule 0, Buyer may elect to assume all
obligations under (and shall not then be required to repay or cause to be repaid) the
Industrial Revenue Bonds, series 1998, issued by the City of Albuquerque, New Mexico; and

          Buyer shall pay, or cause to be paid, on behalf of Sellers and the Company, the
Company Transaction Expenses (as detailed in the Closing Payment Certificate) by wire
transfer of immediately available funds to accounts specified in the Closing Payment
Certificate.

     3. Sellers acknowledge that they will have no claims against Buyer with respect to (i)
payments that have been actually wired by Buyer to the Disbursing Agent pursuant to Section
0 or to the Seller Representative pursuant to Section E.3, in each case upon receipt by
such Person, or (ii) any division of such payments among Sellers thereafter, except, in each case,
to the extent any payments by Buyer are insufficient to satisfy its obligations under, or otherwise
result in a breach or violation of, the terms of this Agreement.

     4. Any Tax benefit arising from the payment of the Indebtedness Payoff Amount
(exclusive of the step-up in basis of the assets attributable thereto) and any Company Transaction
Expenses shall be allocated to Sellers.

     E. Final Cash On Hand, Net Working Capital and Indebtedness Calculations.

     1. Determination. As promptly as possible, but in any event within 90 days
after the Closing Date, the Seller Representative will deliver to Buyer an audited consolidated
balance sheet of the Company as of the Determination Moment (the “Closing Balance Sheet”),
prepared, at Buyer’s expense, in accordance with GAAP applied consistently with the Company’s
Accounting Practices and Procedures, and a reasonably detailed statement (the “Closing
Statement”) setting forth the Seller Representative’s calculations of Cash On Hand, the Closing
Date Indebtedness and the Net Working Capital Amount prepared based on the Closing Balance Sheet.
From the Closing until the delivery of the Closing Balance Sheet and the Closing Statement, the
Seller Representative and its auditors, accountants and other representatives shall be permitted
reasonable access during normal business hours to the Company’s and its Subsidiaries’ auditors,
accountants, facilities, personnel, books and records and other documents in connection with the
preparation of the Closing Balance Sheet and the Closing Statement. In connection with the
preparation of the Closing Balance Sheet, KPMG LLP will perform a review of the inventory of the
Company and its Subsidiaries consistent with the standard inventory work performed by KPMG LLP in
connection with an audit, as set forth on Schedule E, which review will be performed at
Buyer’s sole expense and the results of which will be included in the Closing Balance Sheet and the
Closing Statement. For the avoidance of doubt, to the extent of any inconsistency between
generally accepted auditing standards (“GAAS”) necessary to issue financial statements in
accordance with GAAP and Schedule 1.05, the 
GAAS requirements shall control. After delivery of the Closing Balance Sheet and the
Closing Statement, Buyer and its accountants shall be permitted reasonable access during normal
business hours to review the work papers, if any, of the Seller Representative (including any work
papers of the Seller Representative’s accountants) related to the preparation of the Closing
Balance Sheet and the Closing Statement, subject to such confidentiality restrictions as the Seller
Representative or its accountants shall reasonably request. Buyer and its accountants may make
inquiries of the Seller Representative and its accountants regarding questions concerning or
disagreements with the Closing Statement arising in the course of its review thereof, and the
Seller Representative shall, and shall use its commercially reasonable efforts to cause any such
accountants to, cooperate with and respond to such inquiries. If Buyer has any objections to the
Closing Statement, Buyer shall deliver to the Seller Representative a statement setting forth in
reasonable detail the item in dispute, the amount thereof in dispute and the basis for its
objections thereto (an “Objections Statement”). If an Objections Statement is not
delivered to the Seller Representative within 30 days after delivery of the Closing Statement (or
if access to the work papers as described above is requested, within 30 days after such access is
granted), the Closing Statement shall be final, binding and non-appealable by the parties hereto.
The Seller Representative and Buyer

4

 

shall negotiate in good faith to resolve any objections set
forth in the Objections Statement (and all such discussions related thereto shall, unless otherwise
agreed by the Seller Representative and Buyer, be governed by Rule 408 of the Federal Rules of
Evidence (and any applicable similar state rule)), but if they do not reach a final resolution
within 15 days after the delivery of the Objections Statement, the Seller Representative and Buyer
shall submit such dispute to PriceWaterhouseCoopers LLP (the “Independent Auditor”). If
any dispute is submitted to the Independent Auditor, each party will furnish to the Independent
Auditor such work papers and other documents and information relating to the disputed issues as the
Independent Auditor may request and are available to that party or its independent accountants
(including information of the Company and its Subsidiaries) and each party shall be afforded the
opportunity to present the Independent Auditor material relating to the determination and to
discuss the determination with the Independent Auditor. The Independent Auditor shall not act as
an arbitrator and shall resolve only those matters that remain in dispute after the 15-day
resolution period. It is the intent of Buyer and the Company that the process set forth in this
Section I.E and the activities of the Independent Auditor in connection herewith are not
intended to be and, in fact, are not arbitration and that no formal arbitration rules shall be
followed (including rules with respect to procedures and discovery). The Seller Representative and
Buyer shall use their commercially reasonable efforts to cause the Independent Auditor to resolve
all such disagreements as soon as practicable but in no event later than 30 days after submission
of the disputed issues to the Independent Auditor. The resolution of the dispute by the
Independent Auditor shall be final, binding and non-appealable on the parties hereto. The Closing
Statement shall be modified if necessary to reflect such determination. The fees and expenses of
the Independent Auditor shall be allocated to be paid by Buyer, on the one hand, and/or the Seller
Representative (which amount may be paid from the Seller Representative Holdback), on the other
hand, based upon the percentage which the portion of the contested amount not awarded to each party
bears to the amount actually contested by such party, as determined by the Independent
Auditor.

     2. Adjustments. 

          Cash On Hand Adjustment. If the Cash On Hand as finally determined pursuant to
Section I.E.1 above is greater than the Estimated Cash On Hand, Buyer or the Company shall
pay to each Seller such Seller’s Percentage Share of such excess in accordance with Section
I.E.3. If the Cash On Hand as finally determined pursuant to Section I.E.1 above is
less than the Estimated Cash On Hand, Buyer shall be paid such shortfall in accordance with
Section I.E.3.

          Net Working Capital Adjustment. If the positive difference between Net Working
Capital Amount as finally determined pursuant to Section I.E.1 above and the Estimated Net
Working Capital Amount is greater than $1,000,000, Buyer or the Company shall pay to each Seller
such Seller’s Percentage Share of such excess over $1,000,000 in accordance with Section
I.E.3. If the absolute value of the negative difference between Net Working Capital Amount as
finally determined pursuant to Section I.E.1 above and the Estimated Net Working Capital
Amount is greater than $1,000,000, Buyer shall be paid such excess over $1,000,000 in accordance
with Section I.E.3.

          Closing Date Indebtedness Adjustment. If the Closing Date Indebtedness as finally
determined pursuant to Section I.E.1 above is less than the Estimated Closing Date
Indebtedness, Buyer or the Company shall pay to each Seller such Seller’s Percentage Share of such
shortfall in accordance with Section I.E.3. If the Closing Date Indebtedness as finally
determined pursuant to Section I.E.1 above is greater than the Estimated Closing Date
Indebtedness, Buyer shall be paid such excess in accordance with Section I.E.3.

     3. Final Adjustment Amount. Without duplication, all amounts owed pursuant to
Sections 0, 0, and 0 shall be aggregated, and the net amount (if any) owed
by Buyer to Sellers, on the one hand, or from the Escrow Fund to Buyer, on the other hand, shall be
referred to as the “Final Adjustment Amount”; it being understood and agreed that if the
net effect pursuant to this Section I.E.3 is an increase in the total consideration payable
by Buyer, then Buyer shall make a cash payment to the Disbursing Agent in an amount equal to such
Final Adjustment Amount, and if the net effect pursuant to this Section I.E.3 is a decrease
in the total consideration payable by Buyer, then the Seller Representative shall cause to be paid
to Buyer from the Escrow Fund an aggregate amount equal to the Final Adjustment Amount; provided
that to the extent such Final Adjustment Amount to be paid to Buyer exceeds the Escrow Fund, each
Seller shall pay to Buyer such Seller’s Percentage Share of such excess. The Final Adjustment
Amount shall be treated as an adjustment to the total consideration paid by 
Buyer. Payment of the Final Adjustment Amount shall be paid by wire transfer of
immediately available funds to an account designated by Buyer, in the case of any payment to Buyer,
and the Seller Representative, in the case of any payment to the Sellers, within five business days
after the date of final determination. 

     F. Escrow Amount. The “Escrow Amount” shall initially be an aggregate amount
equal to $20,000,000, subject to replenishment pursuant to the terms of this Section F, and
shall be released in accordance with the terms of the Escrow Agreement. In the event that the
Final Adjustment Amount (a) decreases the Purchase Price, (b) is paid to Buyer from the Escrow Fund
in accordance with Section I.E.3, and (c) is greater than $3,000,000 in the aggregate,
then, within 15 days of the payment of the Final Adjustment Amount by the Escrow Agent, the Seller
Representative shall deliver to the Escrow Agent from the Seller Representative Holdback an amount
equal to the amount by which the Final Adjustment Amount exceeds $3,000,000 (the “Replenishment
Amount”); provided that in no event shall the Replenishment Amount delivered by the
Seller Representative reduce the funds remaining in the Seller Representative Holdback to an amount
less than $1,000,000 (the “Holdback Floor”); provided further that in no
event shall the Replenishment Amount delivered by the Seller Representative exceed $2,000,000 in
the aggregate (the “Replenishment Cap”). For the avoidance of doubt, neither the Seller
Representative nor the Sellers shall have any

5

 

obligation to replenish the Escrow Fund (i) in the
event that the Final Adjustment Amount is $3,000,000 or less in the aggregate or (ii) for any
portion of the Final Adjustment Amount paid to Buyer from the Escrow Fund in excess of the
Replenishment Cap.

II. 

CONDITIONS TO CLOSING; DELIVERIES

     A. Conditions to Each Party’s Obligation. The respective obligation of each party hereto to
consummate the transactions contemplated by this Agreement is subject to the satisfaction or waiver
by such party of the following conditions on or prior to the Closing Date:

     1. All of the consents and approvals of governmental authorities which are set forth
on Schedule II.A.1 shall have been obtained;

     2. No judgment, decree or order shall have been entered, promulgated, enforced or
issued by any governmental authority which would prevent the consummation of the transactions
contemplated by this Agreement; 

     3. At the Closing, Buyer and the Seller Representative, on behalf of Sellers, shall
have delivered the Escrow Agreement, duly executed by Buyer, the Seller Representative, and the
Escrow Agent; and 

     4. At the Closing, Buyer and the Seller Representative, on behalf of Sellers, shall
have delivered the Disbursing Agent Agreement, duly executed by Buyer, the Seller Representative,
and the Disbursing Agent.

     B. Conditions to Buyer’s Obligations. The obligation of Buyer to consummate the transactions
contemplated by this Agreement, is subject to the satisfaction, on or prior to the Closing Date, of
each of the following conditions (any of which, in Buyer’s absolute and sole discretion, may be
waived in writing in whole or in part without impairing or affecting any right of indemnification
or to equitable relief under this Agreement except as provided herein):

     1. The representations and warranties set forth in III and IV shall be
true and correct at and as of the date of this Agreement and as of the Closing Date as though then
made (other than those representations and warranties that address matters as of particular dates
which shall be true and correct at and as of such particular dates), except where the failure of
such representations and warranties to be so true and correct has not had, individually or in the
aggregate, a material adverse effect on (i) the assets, business, financial condition or results of
operations of the Company and its Subsidiaries, taken as a whole or (ii) the ability of Sellers and
the Company to consummate the transactions contemplated hereby;

     2. The Company and Sellers shall have performed in all material respects all of the
covenants and agreements required to be performed by them under this Agreement at or prior to the
Closing; 

     3. Since the date of this Agreement, no Material Adverse Change shall have occurred
and be continuing; 

     4. No action, suit or proceeding shall be pending against Buyer, Sellers or the
Company, at law or in equity, by any federal, state, municipal or other governmental department,
commission, board, bureau or agency, domestic or 
foreign, seeking to enjoin, or adversely affecting (other than in an immaterial manner),
the transactions contemplated by this Agreement; and

     5. At the Closing, the Company or the Seller Representative, on behalf of Sellers,
shall have delivered to Buyer a certificate of the Company in the form reasonably satisfactory to
Buyer, dated as of the Closing Date, stating that the preconditions specified in Sections
II.B.1, II.B.2 and II.B.4, as they relate to the Company and the Sellers, have
been satisfied.

     6. All agreements and other arrangements, whether oral or written, with Related
Persons which are disclosed pursuant to Section IV.P shall be terminated on or prior to the
Closing, except to the extent the continuation thereof is specifically consented to by Buyer in
writing.

     C. Conditions to Sellers’ and the Company’s Obligations. The obligation of Sellers and the
Company to consummate the transactions contemplated by this Agreement, is subject to the
satisfaction, on or prior to the Closing Date, of each of the following conditions (any of which,
in the Seller Representative’s absolute and sole discretion, may be waived in writing in whole or
in part without impairing or affecting any right of indemnification or to equitable relief under
this Agreement): 

6

 

     1. The representations and warranties set forth in V shall be true and correct
at and as of the date of this Agreement and as of the Closing Date as though then made (other than
those representations and warranties that address matters as of particular dates which shall be
true and correct at and as of such particular dates), except where the failure of such
representations and warranties to be so true and correct has not had, individually or in the
aggregate, a material adverse affect on (i) the assets, business, financial condition or results of
operations of Buyer or (ii) the ability of Buyer to consummate the transactions contemplated
hereby;

     2. Buyer shall have performed in all material respects all of the covenants and
agreements required to be performed by it under this Agreement at or prior to the Closing; 

     3. No action, suit or proceeding shall be pending against Buyer, Sellers or the
Company, at law or in equity, by any federal, state, municipal or other governmental department,
commission, board, bureau or agency, domestic or foreign, seeking to enjoin, or adversely affecting
(other than in an immaterial manner), the transactions contemplated by this Agreement; and

     4. At the Closing, Buyer shall have delivered to the Seller Representative a
certificate of Buyer in the form reasonably satisfactory to the Seller Representative, dated as of
the Closing Date, stating that the preconditions specified in Sections II.C.1,
II.C.2 and II.C.3, as they relate to the Buyer, have been satisfied.

     D. Deliveries. 

     1. At or prior to the Closing, the Company or the Seller Representative, on behalf of
Sellers, shall deliver, or cause to be delivered, to Buyer: 

          a copy of the articles of organization of the Company (certified by the Secretary
of the State of Delaware) and a certificate of good standing from the State of Delaware for
the Company dated within five days of the Closing Date;

          a certified copy of the Company’s operating agreement;

          certified copies of the resolutions duly adopted by the Company’s management
committee authorizing the execution, delivery and performance of this Agreement and the
other agreements contemplated hereby to which the Company is a party, and the consummation
of the transactions contemplated hereby and thereby; 

          such instruments as shall be necessary and reasonably requested by Buyer
documenting the transfer to Buyer of title in and to the Units in accordance with the terms
of this Agreement; and

          payoff letters in form and substance reasonably satisfactory to Buyer relating to
all Indebtedness paid pursuant to Section 1.04(b)(iii), in each case evidencing the
aggregate amount of such Indebtedness outstanding as of the Closing Date (including any
interest accrued thereon and any prepayment or similar penalties and expenses associated
with the prepayment of such Indebtedness on the Closing Date).

     2. At or prior to the Closing, Buyer shall deliver, or shall cause to be delivered, to
the Seller Representative certified copies of the resolutions duly adopted by Buyer’s board of
directors (or its equivalent governing body) authorizing the execution, delivery and performance of
this Agreement and the other agreements 
contemplated hereby to which Buyer is a party, and the consummation of the transactions
contemplated hereby and thereby.

III. 

REPRESENTATIONS AND WARRANTIES OF EACH SELLER

     Each Seller, solely for himself, herself or itself (on a several and not joint basis),
represents and warrants to Buyer as of the date hereof as follows:

     A. Authority. Such Seller has all requisite legal capacity, power and authority
(including, if applicable, full organizational power and authority) to execute and deliver this
Agreement and to perform such Seller’s obligations hereunder.

     B. Execution and Delivery; Valid and Binding Agreement. This Agreement has been duly
authorized, executed and delivered by such Seller, and no other proceedings by such Seller are
necessary to authorize the execution, delivery or performance of this Agreement by such Seller or
the consummation by such Seller of the transactions contemplated hereby. Assuming this Agreement
is the valid and binding agreement of each of the other parties hereto, this Agreement constitutes
a valid and binding agreement of such Seller, enforceable against such Seller in accordance with
its terms, except as enforceability may be limited by bankruptcy laws, other similar laws affecting
creditors’ rights and general principles of equity affecting the availability of specific
performance and other equitable remedies.

7

 

     C. Ownership of the Units. Such Seller is the record and beneficial owner of the Units
set forth opposite such Seller’s name on Schedule IV.D. At Closing, such Seller shall
transfer to Buyer good title to such Seller’s Units, free and clear of any Liens, other than
applicable federal and state securities law restrictions and restrictions and Liens being released
at the Closing.

     D. No Conflict or Violation. Except, (i) with respect to clauses 1(y)(B) and (2) below,
for matters that individually or in the aggregate, are not reasonably expected to prevent,
materially impede, interfere with, hinder or delay the consummation by such Seller of the
transactions contemplated hereby, and (ii) for the applicable requirements of the HSR Act and
foreign equivalents thereof (the “Foreign Equivalents”) and approval of the French Ministry
of Economy pursuant to articles L. 151-3 and R. 153-1 and seq. of the French Monetary and Financial
Code (Code Monétaire et Financier) and article 4 of the Order (Arrété) dated March 7, 2003
(collectively, the “French Legal Requirements”), the execution, delivery and performance of
this Agreement by such Seller and the consummation of the transactions contemplated hereby do not
(1) result in (x) the creation of any Lien upon any Units held by such Seller under, or (y) result
in any breach of, constitute any default under, or result in a violation of, in each case (A) the
provisions of such Seller’s certificate or articles of incorporation or bylaws or equivalent
organizational documents, (B) any material indenture, mortgage, lease, loan agreement or other
material agreement or instrument to which such Seller is bound, or any law, statute or regulation
or (C) any order, judgment or decree to which such Seller is subject, or (2) require any permit,
authorization, consent or approval by, filing with or notice or declaration to any court or other
governmental body.

     E. Litigation. There are no actions, suits or proceedings pending or, to such Seller’s
knowledge, threatened against such Seller, at law or in equity, or before or by any federal, state,
municipal or other governmental department, commission, board, bureau or agency, domestic or
foreign, relating to or affecting in any adverse manner the transactions contemplated by this
Agreement.

     F. Brokerage. No broker, finder, financial advisor, investment banker or other Person is
entitled to any brokerage commissions, finders’ fees or similar compensation in connection with
this Agreement or the transactions contemplated by this Agreement based on any arrangement or
agreement made by or on behalf of such Seller.

IV. 

REPRESENTATIONS AND WARRANTIES OF THE COMPANY

The Company represents and warrants to Buyer as of the date hereof that:

     A. Organization and Organizational Power. The Company is a limited liability company
duly organized, validly existing and in good standing under the laws of the State of Delaware, and
the Company has all requisite limited liability company power and authority to own, operate and
lease its properties and to carry on its businesses as now conducted. The Company is duly
qualified or licensed to do business and is in good standing in every jurisdiction in which its
ownership of assets or property or the conduct of businesses as now conducted requires it to be so
qualified or licensed, except where the failure to be so qualified or licensed or in good standing
would not materially affect the ability of Buyer and the Company to operate the business of the
Company and its Subsidiaries in the ordinary course and consistent with past practices. The
Company has made available to Buyer true and complete copies of the organizational documents of the
Company as currently in effect.

     B. Subsidiaries.

     1. Except as set forth on Schedule IV.B, neither the Company nor any of its
Subsidiaries owns any stock, partnership interest, joint venture interest or other equity ownership
interest in any other Person. Schedule IV.B sets forth the jurisdiction of organization of
each Subsidiary of the Company and each jurisdiction where the Company and each Subsidiary of the
Company is qualified to do business.

     2. Except as set forth on Schedule IV.B, each Subsidiary of the Company is
wholly owned by the Company or another Subsidiary of the Company as indicated on Schedule
IV.B.

     3. Each Subsidiary of the Company identified on Schedule IV.B (i) is validly
existing and in good standing (when applicable) under the laws of the jurisdiction of its
organization, (ii) has all requisite organizational power and authority to own, operate and lease
its properties and to carry on its businesses as now conducted and (iii) is duly qualified or
licensed to do business and is in good standing in every jurisdiction in which its ownership of
assets or property or the conduct of its business as now conducted requires it to be so qualified
or licensed, except in the case of clause (iii), where the failure to be so qualified or licensed
or in good standing would not materially affect the ability of Buyer and the Company to operate the
business of the Company and its Subsidiaries in the ordinary course and consistent with past
practices. The Company has made available to Buyer true and complete copies of the organizational
documents of each of its Subsidiaries as currently in effect.

     4. The minute books of the Company and each Subsidiary of the Company contain records,
that are true and correct in all material respects, of all meetings and other material corporate
actions held or taken since January 1, 2008 of their respective shareholders, members, partners or
other equity holders and boards of directors or other governing bodies (including committees of
their respective boards of directors or other governing bodies) through the date hereof. All such
minute books of the Company and its Subsidiaries have been made available to Buyer.

     C. Authorization; Valid and Binding Agreement; No Breach; Consents.

8

 

     1. The Company has all requisite limited liability company power and
authority to execute and deliver this Agreement, to perform its obligations hereunder and to
consummate the transactions contemplated hereby. This Agreement has been duly authorized, executed
and delivered by the Company and no other limited liability company action on the part of the
Company is necessary to authorize the execution and delivery of this Agreement by the Company, the
performance by the Company of its obligations hereunder or the consummation by the Company of the
transactions contemplated by this Agreement. Assuming that this Agreement is a valid and binding
obligation of each of the other parties hereto, this Agreement constitutes a valid and binding
obligation of the Company, enforceable in accordance with its terms, except as enforceability may
be limited by bankruptcy laws, other similar laws affecting creditors’ rights and general
principles of equity affecting the availability of specific performance and other equitable
remedies.

     2. Except (i) as set forth on Schedule IV.C, (ii) for the applicable
requirements of the HSR Act and the Foreign Equivalents and approval of the French Ministry of
Economy pursuant to the French Legal Requirements and (iii) with respect to clauses
(1)(y) and (2) below, where the failure of any of the following to be true would not materially
affect the ability of Buyer and the Company to operate the business of the Company and its
Subsidiaries, after the Closing, in the ordinary course and consistent with past practices, the
execution, delivery and performance of this Agreement by the Company and the consummation of the
transactions contemplated hereby do not (1) result in any breach of, constitute a default under,
result in a violation of, result in the creation of any Lien (other than a Permitted Lien) upon any
asset or property of the Company or any of its Subsidiaries, or give rise to any third-party rights
of termination or amendment or to a loss of a material benefit to which the Company or any of its
Subsidiaries is entitled (x) under the provisions of the Company’s or any of its Subsidiaries’
certificate or articles of incorporation or bylaws or equivalent organizational documents, (y)
under any indenture, mortgage, lease, loan agreement or other agreement or instrument to which the
Company or any of its Subsidiaries is bound, or any law, statute or regulation or (z) under any
order, judgment or decree to which the Company or any of its Subsidiaries is subject, or (2)
require any permit, authorization, consent or approval by, filing with or notice or declaration to
any court or other governmental body.

     3. Except (i) as otherwise set forth on Schedule IV.C or (ii) where the
failure of any of the following to be true would not materially affect the ability of Buyer and the
Company to operate the business of the Company and its Subsidiaries, after the Closing, in the
ordinary course and consistent with past practices, no consent, approval or authorization of, or
declaration, filing or registration with, any Person is required to be made or obtained by any
Seller, the Company, or any Subsidiary of the Company in connection with the execution, delivery
and performance of this Agreement and the consummation of the transactions contemplated by this
Agreement.

     D. Capitalization and Related Matters.

     1. (i) Schedule IV.D sets forth the authorized and, as of the date of
this Agreement, issued and outstanding equity interests of the Company and its Subsidiaries, the
name of each record holder of the Company’s or such Subsidiary’s equity interests, and the amount
of such class of the Company’s or its Subsidiaries’ equity interests held of record by each such
holder and (ii) the Units represent one hundred percent (100%) of the issued and outstanding equity
interests in the Company.

     2. Except as set forth on Schedule IV.D, all outstanding Units and other
equity securities of the Company and each of its Subsidiaries have been duly authorized and validly
issued and are fully paid and non-assessable, free and clear of any preemptive rights. Except as
set forth on Schedule IV.D, there are no outstanding (i) Units, other equity interests or
voting securities of the Company or any of its Subsidiaries, (ii) securities of the Company or any
of its Subsidiaries convertible into or exchangeable for Units, other equity interests or voting
securities of the Company or any of its Subsidiaries or (iii) options, warrants, unit appreciation
rights, phantom units or other rights to acquire from the Company or any of its Subsidiaries, or
other obligations of the Company or any of its Subsidiaries to issue, deliver or sell, any Units,
other equity interests or voting securities or securities convertible into or exchangeable for
equity interests or voting securities of the Company or any of its Subsidiaries (the items in
clauses IV.D.2(i), IV.D.2(ii) and IV.D.2(iii) being referred to
collectively as the “Company Securities”). Except as set forth on Schedule IV.D,
there are no outstanding obligations of the Company or any of its Subsidiaries to repurchase,
redeem or otherwise acquire or retire for value any Company Securities. Except as set forth on
Schedule IV.D, there are no voting trusts, shareholder agreements, proxies or other
agreements or understandings in effect to which the Company or any of its Subsidiaries is a party,
or by which it is bound, with respect to the governance of the Company or any of its Subsidiaries
or the voting or transfer of any Company Securities.

     3. Schedule IV.D.3 sets forth a list of all outstanding Indebtedness of
the Company and each Subsidiary of the Company. No material default exists with respect to any
such Indebtedness.

     E. Financial Statements.

     1. Set forth on Schedule E are: (i) an unaudited consolidated balance
sheet as of March 31, 2011 (the “Latest Balance Sheet”), and the related consolidated
statements of income and cash flow of the Company for the 3-month period then ended (together with
the Latest Balance Sheet, the “Unaudited Financial Statements”) and (ii) the audited
consolidated balance sheet as of December 31, 2010, (the “2010 Audited Balance Sheet”), and
the related consolidated statements of income and cash flow of the Company for the fiscal years
ended December 31, 2010

9

 

(together with the 2010 Audited Balance Sheet, the “Audited Financial
Statements” and, together with the Unaudited Financial Statements, the “Financial
Statements”). Except as set forth on Schedule E, the Financial Statements (including
the related notes and schedules) have been based upon the information concerning the Company and
its Subsidiaries contained in the Company’s and its Subsidiaries’ books and records, and present
fairly in all material respects the consolidated financial condition and results of operations of
the Company and its Subsidiaries (taken as a whole) as of the times and for the periods referred to
therein and have been prepared in accordance with GAAP consistently applied throughout the periods
referred to therein (subject, in the case of the Unaudited Financial Statements, to normal year-end
audit adjustments, which are not expected, individually or in the aggregate, to be material in
amount or effect and the absence of footnotes and other presentation items).

     2. The Company and its Subsidiaries maintain in all material respects proper and
adequate internal accounting controls which provide assurance that (i) transactions are executed
with management’s authorization; (ii) transactions are recorded as necessary to prepare the
consolidated financial statements of the Company and its Subsidiaries and to maintain
accountability for the Company’s and its Subsidiaries’ consolidated assets; (iii) prevention or
timely detection of unauthorized acquisition, use or disposition of the assets of the Company and
its Subsidiaries; (iv) the reporting of the Company’s and its Subsidiaries’ assets is compared with
existing assets at regular intervals; and (v) accounts, notes and other receivables and inventory
are recorded, and proper and adequate procedures are implemented to effect the collection thereof
on a current and timely basis. 

     3. There are no liabilities or obligations of the Company or any of its
Subsidiaries of the nature required to be disclosed in a balance sheet prepared in accordance with
GAAP, other than liabilities and obligations: (i) reflected or reserved against on the Company’s
Latest Balance Sheet; (ii) that were incurred since the date of the Latest Balance Sheet solely in
the ordinary course of business consistent with past practice; (iii) incurred in connection with
the execution of this Agreement or the consummation of the transactions contemplated hereby; or
(iv) arising under contracts in accordance with their terms (none of which results from, arises out
of or relates to any breach of contract, breach of contractual warranty, tort, infringement or
violation of law). 

     4. There are no liabilities or obligations of the Company or any of its
Subsidiaries of any nature, whether absolute, accrued, contingent, known, unknown, matured,
unmatured or otherwise, and whether or not required to be disclosed or provided for in financial
statements prepared in accordance with GAAP, other than liabilities and obligations: (i) of the
nature required to be disclosed in a balance sheet prepared in accordance with GAAP; (ii) reflected
or reserved against on the Company’s Latest Balance Sheet; (iii) that were incurred since the date
of the Latest Balance Sheet solely in the ordinary course of business consistent with past
practice; (iv) incurred in connection with the execution of this Agreement or the consummation of
the transactions contemplated hereby; (v) arising under contracts in accordance with their terms
(none of which results from, arises out of or relates to any breach of contract, breach of
contractual warranty, tort, infringement or violation of law); or (vi) the aggregate amount of
which is less than $400,000 for all such liabilities and obligations.

     F. Absence of Certain Developments.

     1. Except as set forth on Schedule IV.F.1, since December 31, 2010, until
the date of this Agreement, neither the Company nor any Subsidiary of the Company has experienced
any change, effect, event, occurrence, condition, circumstance, state of facts or development that
has had or would reasonably be expected to have, individually or in the aggregate, a material
adverse effect on the assets, business, financial condition or results of operations of the Company
and its Subsidiaries, taken as a whole.

     2. Except as set forth on Schedule IV.F.2 or except as contemplated by
this Agreement, since December 31, 2010 until the date of this Agreement, neither the Company nor
any Subsidiary of the Company has:

          mortgaged, pledged or subjected to any Lien (other than Permitted Liens), any of
the assets or properties of the Company and its Subsidiaries;

          sold, assigned, leased or transferred any of the tangible assets or property of the
Company and its Subsidiaries to any Person other than the Company and its Subsidiaries,
having a value at the 

time of disposition greater than $100,000 or $250,000 in the aggregate for all such
assets, except in the ordinary course of business consistent with past practice;

          sold, assigned, transferred, licensed or abandoned any of the Company and its
Subsidiaries’ material Intellectual Property, except in the ordinary course of business
consistent with past practice;

          entered into or consummated any other material transaction not in the ordinary
course of business or not otherwise consistent with the Company’s and its Subsidiaries’ past
practices involving consideration in excess of $100,000;

          settled or compromised any material action, suit or proceeding, whether
administrative, civil or criminal, in law or in equity, or before any governmental authority
or cancelled any material debts or waived any rights of material value; 

10

 

          redeemed or repurchased, directly or indirectly, any equity interests or declared,
set aside or paid any dividends or made any other distributions (whether in cash or in kind
and except for any tax distributions) with respect to any of its Units or other equity
interests;

          issued, sold or transferred any of its equity interests, securities convertible
into its equity interests or warrants, options or other rights to acquire its equity
interests; 

          made any capital expenditures or commitments therefore outside the ordinary course
of business consistent with past practice in excess of $1,000,000 in the aggregate, except
in accordance with the Company’s operating budget for the 2011 fiscal year or other current
operating budgets, as the case may be, provided to Buyer prior to the date of this
Agreement;

          changed any of its accounting policies, practices or procedures in any material
respect, except as required by GAAP;

          amended or modified its charter or bylaws; 

          acquired (by merger, consolidation or other combination, or acquisition of stock or
assets or otherwise) any corporation, partnership or other business organization, or any
division thereof; 

          made loans or advances to, guarantees for the benefit of, or investments in any
Affiliates in excess of $1,000,000 in the aggregate; 

          (A) increased the salary of any officer or employee of the Company or any of its
Subsidiaries whose base salary plus bonus exceeded $100,000 for the fiscal year ending
December 31, 2010, other than annual increases or bonuses made in the ordinary course of
business consistent with the Company’s or any of its Subsidiaries past practices and not
exceeding, for any such officer or employee, $25,000; or (B) entered into, materially
amended or terminated any Employee Benefit Plan or Foreign Plan (other than in the ordinary
course consistent with past practice);

          (A) made or changed any material Tax election, (B) settled or compromised any
material claim, notice, audit report or assessment in respect of Taxes, (C) filed any
amendment to a material Tax Return, or (D) surrendered any right to claim a material Tax
refund;

          except in the ordinary course of business, made any acceleration of sales into a
current period, or deferral of sales into a future period or any change in pricing or
discounts offered to customers of the Company or its Subsidiaries or any change in its
customer deposit policy; or

          agreed or committed to do any of the foregoing.

     G. Title to Properties; Tangible Assets.

     1. Except as set forth on Schedule IV.G.1, as of the date hereof, there
is no material Tangible Personal Property used in the operation of the business of the Company and
its Subsidiaries other than the Tangible Personal Property reflected as owned on the Latest Balance
Sheet and Tangible Personal Property purchased in the ordinary course of business since the date of
the Latest Balance Sheet. Except as set forth on Schedule IV.G.1, the Owned Tangible
Personal Property is free and clear of any Liens (other than Permitted Liens). Except as set forth
in Schedule IV.G.1 and other than any damaged or non-functioning equipment acquired by the
Company or its Subsidiaries in such condition for the strategic business purpose of repairing such
equipment for use in the operations of the
Company or its Subsidiaries, the Tangible Personal Property currently used in the business
of the Company and its Subsidiaries is, taken as a whole, in reasonable working order and is
reasonably adequate for its intended use, ordinary wear and tear and normal repairs and
replacements excepted.

     2. Schedule IV.G.2 lists all real property owned by the Company or any of
its Subsidiaries (“Owned Real Property”) identifying the address and owner thereof. With
respect to each parcel of Owned Real Property, except as set forth on Schedule IV.G.2, and
except for matters that would not, individually or in the aggregate, reasonably be expected to
materially impair or interfere with the current use or operation or the value of the Owned Real
Property: (i) the Company or one of its Subsidiaries has good, valid and marketable fee simple
title, free and clear of all Liens, except for Permitted Liens, to each parcel of Owned Real
Property; (ii) neither the Company nor any of its Subsidiaries has leased or otherwise granted to
any Person the right to use or occupy such Owned Real Property or any portion thereof; and (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.

     3. The real property demised by the lease and sublease agreements described on
Schedule IV.G.3 (the “Real Property Leases”) constitutes all of the material real
property leased or subleased by the Company and its Subsidiaries (the “Leased Real
Property”) (excluding, for the avoidance of doubt, among other things, any short-term

11

 

leases or
subleases (e.g., with a lease term of less than one year) with nominal rent). Except as set forth
on Schedule IV.G.3, the Real Property Leases are, to the Company’s knowledge, in full force
and effect, enforceable in accordance with their terms, subject to proper authorization and
execution of such Real Property Lease by the other party thereto and the limitations of bankruptcy
laws, other similar laws affecting creditors’ rights and general principles of equity affecting the
availability of specific performance and other equitable remedies. The Company has made available
to Buyer copies of the Real Property Leases. Except as set forth on Schedule IV.G.3: (i)
to the Company’s knowledge, neither the Company nor any of its Subsidiaries is in material breach
or default under any of such Real Property Leases and neither the Company nor any of its
Subsidiaries has received any written notice of any material default or event that with notice or
lapse of time, or both, would constitute a material default by the Company or any of its
Subsidiaries under such Real Property Leases; (ii) the other party to such Real Property Lease is
not an Affiliate of, and otherwise does not have any material economic interest in, the Company or
the applicable Subsidiary; (iii) the Company or the applicable Subsidiary has a good and valid
leasehold interest in all Leased Real Property and has not collaterally assigned, mortgaged,
deeded in trust or granted any other Lien in such Real Property Lease or any interest therein other
than Permitted Liens; (iv) there are no material Liens affecting the Real Property Leases, other
than Permitted Liens; and (v) the Real Property Leases constitute all written and oral agreements
of any kind for the leasing, rental, use or occupancy of the Leased Real Property and are the
result of bona fide arms length negotiations between the parties.

     H. Tax Matters. Except as set forth on Schedule IV.H:

     1. The Company and its Subsidiaries have filed all material Tax Returns required
to be filed by them (taking into account all applicable extensions) through the date hereof and all
such Tax Returns are complete and correct in all material respects.

     2. All material Taxes of the Company and its Subsidiaries required to be paid
have been paid by the Company and its Subsidiaries.

     3. No unresolved dispute or claim concerning any material Tax liability of the
Company or any of its Subsidiaries has been asserted by any Tax authority in writing.

     4. Neither the Company nor any of its Subsidiaries has waived any statute of
limitations in respect of any material Taxes or agreed to any extension of time with respect to a
material Tax assessment or deficiency which waiver or extension remains in effect.

     5. There are no material Liens for Taxes (other than Permitted Liens) on any of
the assets of the Company or any of its Subsidiaries.

     6. To the Company’s knowledge, no claim has ever been made by a Tax authority in
a jurisdiction where the Company or any of its Subsidiaries does not file a Tax Return that the
Company or such Subsidiary (as the case may be) is subject to taxation by that jurisdiction in
respect of Taxes that would be covered by or would be the subject of such Tax Return.

     7. The Company has delivered or made available to Buyer complete and accurate
copies of all federal, state and foreign income Tax Returns of the Company and its Subsidiaries
that have been filed for all taxable years ended after December 31, 2007.

     8. No power of attorney with respect to any Taxes of the Company or any of its
Subsidiaries has been executed or filed with any Tax authority, which power of attorney is still in
effect.

     9. The Company is taxable as a partnership for United States federal income tax
purposes. Other than CVI Laser International LLC, the Company does not own a single member limited
liability company which is treated as a disregarded entity. No entity classification election
pursuant to Treasury Regulations Section 301.7701-3 has been filed with respect to the Company or
any of the Company’s Subsidiaries.

     10. Neither the Company nor any of its Subsidiaries is or has been a party to any
“listed transaction,” as defined in Section 6707A(c)(2) of the Code and Treasury Regulations
Section 1.6011-4(b)(2).

     11. Neither the Company nor any of its Subsidiaries is a party to any tax-sharing
agreement or any similar agreement.

     I. Contracts and Commitments.

     1. Except as set forth on Schedule IV.I.1 and other than any Employee
Benefit Plan and any Foreign Plan, as of the date of this Agreement neither the Company nor any of
its Subsidiaries is party to any written or oral: (i) note, debenture, guarantee, mortgage, loan
agreement or indenture relating to Indebtedness or any other agreement which imposes a Lien (other
than a Permitted Lien) on the property or assets of the Company; (ii) lease or 

12

 

agreement under
which it is lessee of, or holds or operates any tangible personal property owned by any other
party, for which the annual rental exceeds $500,000 and which is not terminable on 60 or fewer days
notice by the Company or any Subsidiary of the Company without liability for any material penalty;
(iii) lease or agreement under which it is lessor of or permits any third party to hold or operate
any tangible personal property, for which the annual rental exceeds $500,000 and which is not
terminable by on 60 or fewer days notice by the Company or any Subsidiary of the Company without
liability for any material penalty; (iv) contract or group of related contracts with the same party
for the purchase of products, inventory, supplies, equipment, machinery, services or other tangible
personal property by the Company or any of its Subsidiaries, under which the undelivered balance of
such products, inventory, supplies, equipment, machinery, services or other personal property has a
selling price in excess of $500,000 and which is not terminable on 60 or fewer days notice by the
Company or any Subsidiary of the Company without liability for any material penalty; (v) contract
(exclusive of purchase orders issued in the ordinary course of business) with any customer of the
Company or any of its Subsidiaries that has generated at least $1,000,000 of net revenue to the
Company during the 12-month period ending December 31, 2010; (vi) contract containing covenants
limiting the freedom of the Company or any Subsidiary of the Company to compete in any line of
business; (vii) agreement pursuant to which the Company or any of its Subsidiaries is granted the
right to use or the right to grant others the right to use Intellectual Property material to the
conduct by the Company and its Subsidiaries of their respective businesses, other than in-bound
licenses for commercial Software that is “off-the-shelf” or widely available; (viii) agreement
pursuant to which, the Company or any of its Subsidiaries grants to any third party the right to
use Intellectual Property material to the conduct by the Company and its Subsidiaries (other than
ancillary to a sale of products to customers or pursuant to standard agreements consistent with the
Company’s and the Subsidiaries’ customary business practices); (ix) written joint venture,
partnership or limited liability company agreement or any oral joint venture, partnership or
limited liability company agreement or any such agreement arising under common law; (x) contract
relating to the acquisition or sale of the Company’s or its Subsidiaries’ business (or any material
portion thereof), whether or not consummated; (xi) contract or purchase order for capital
expenditures or the acquisition or construction of fixed assets requiring the payment by the
Company or any of its Subsidiaries of an amount in excess of $1,000,000; (xii) royalty agreement;
(xiii) agreement providing for termination, retention, change in control or similar payments or
(xiv) consulting, distributor, sales representative or dealer agreement which is not cancelable on
90 or fewer days notice by the Company or any of its Subsidiaries without liability.

     2. The Company has made available to Buyer true and correct copies of all
contracts, including all amendments applicable thereto, required to be listed on Schedule
IV.I.1. With respect to each of the contracts required to be listed on Schedule
IV.I.1, except as set forth on Schedule IV.I.2: (i) such contract is in all material
respects legal, valid, binding and enforceable in accordance with their respective terms with
respect to the Company or any Subsidiary of the Company, as applicable, and, to the Company’s
knowledge, each other party to such contracts and are in full force and effect, except as
enforceability may be limited by bankruptcy laws, other similar laws affecting creditors’ rights
and general principles of equity affecting the availability of specific performance and other
equitable remedies; (ii) neither the Company nor any of its Subsidiaries nor, to the Company’s
knowledge, any other party thereto, is in breach, violation or default in any material respect
under any such contract; (iii) there exists no occurrence, condition or act which constitutes, with
the giving of notice or the lapse of time or both, a material default or breach by the Company or
any Subsidiary of the Company or, to the Company’s knowledge, any other party under any such
contracts; (iv) neither the Company nor any of its Subsidiaries has received written notice of
cancellation or termination or, other than pursuant to the terms of such contract existing as of
the date hereof, change in material terms (including, pricing, term and volume) of any such
contract; and (v) neither the Company nor any Subsidiary of the Company has during the two years
prior to the date hereof obtained or granted any material waiver of or under any provision of any
such contract except for routine waivers granted or sought in the ordinary
course of business. To the Company’s knowledge, no default has been threatened under any
contract required to be listed on Schedule IV.I.1.

     3. With respect to all other contracts (written or oral) of the Company and its
Subsidiaries that are material to the business of the Company and its Subsidiaries, except as set
forth on Schedule 4.09(c): (i) neither the Company nor any of its Subsidiaries nor, to the
Company’s knowledge, any other party thereto, is in breach, violation or default in any material
respect under any such contract; and (ii) there exists no occurrence, condition or act which
constitutes, with the giving of notice or the lapse of time or both, a material default or breach
by the Company or any Subsidiary of the Company or, to the Company’s knowledge, any other party
under any such contracts.

     J. Intellectual Property. Schedule J(a) contains a list of all (i) issued
patents and patent applications, (ii) trademark registrations and trademark applications, (iii)
copyright registrations, and (iv) registered domain names owned by the Company or any of its
Subsidiaries in any jurisdiction throughout the world, together with the name of the current
owner(s) of record, the applicable jurisdiction and the application or registration number. Except
as set forth on Schedule J(b): (i) the Company or one of its Subsidiaries owns, or
possesses the valid and enforceable right to use, the Intellectual Property that is material to the
conduct of the businesses of the Company and its Subsidiaries as currently conducted, including,
but subject to any disclosed outbound exclusive licenses of such Intellectual Property, all
Intellectual Property set forth on Schedule J(a); (ii) during the two-year period prior to
the date of this Agreement (or earlier as to any such claims which are known to the Company to
exist and remain unresolved), neither the Company nor any of its Subsidiaries has received any
written notices (A) alleging infringement, misappropriation or violation by the Company or any
Subsidiary of the Company from any third party with respect to Intellectual Property or (B)
challenging the validity, enforceability or ownership of any Intellectual Property owned by the
Company or any Subsidiary of the Company; (iii) to the Company’s knowledge, no third party is
infringing, misappropriating or otherwise violating in any material respect any Intellectual
Property owned by the Company or any of its Subsidiaries; (iv) the Company takes reasonable actions
(including executing non-disclosure and Intellectual Property assignment agreements) to protect and
maintain its and its Subsidiaries’ material Intellectual Property assets; (v) the Company takes
reasonable actions to protect the confidentiality, integrity and security of its and its
Subsidiaries’ Software from any

13

 

unauthorized use, access, interruption or modification by third
parties; (vi) to the Company’s knowledge, no Software owned or used by the Company or any of its
Subsidiaries is or contains or is derived from open source, shareware, or similar Software in a
manner that obligates the Company or any of its Subsidiaries to disclose or distribute any portion
of the source code of such Software or component thereof to any third party, other than the
applicable open source Software; (vii) there are no agreements to which the Company or any of its
Subsidiaries is a party that contain any obligation of the Company or any of its Subsidiaries to
transfer to others ownership of any Intellectual Property; and (viii) neither the Company nor any
of its Subsidiaries has developed any Intellectual Property covered by any obligation to transfer
ownership thereof pursuant to any written or oral agreement to which the Company or any of its
Subsidiaries is a party.

     K. Litigation. Except as set forth on Schedule IV.K, there are no actions,
suits or proceedings pending or, to the Company’s knowledge, threatened against (a) the Units, (b)
the Company or any of its Subsidiaries, or (c) to the Company’s knowledge, the properties, assets,
or business of the Company or any Subsidiary of the Company, at law or in equity, or before or by
any federal, state, municipal or other governmental department, commission, board, bureau or
agency, domestic or foreign, and neither the Company nor any of its Subsidiaries, to has been
notified in writing or, to the Company’s knowledge, orally of any outstanding judgment, order or
decree of any court or governmental body.

     L. Employee Benefit Plans.

     1. (i) Schedule IV.L.1(i) sets forth a list of each Employee Benefit Plan
and each Foreign Plan; (ii) except as would not result in a material liability to the Company, each
Employee Benefit Plan and each Foreign Plan complies in form and in operation, and has been
administered in accordance with, its terms and the applicable requirements of ERISA, the Code and
other applicable laws; and (iii) there is no claim, suit or other proceeding (including
investigations by a governmental entity) pending, or to the Company’s knowledge, threatened with
respect to any Employee Benefit Plan or Foreign Plan, other than ordinary and routine claims for
benefits.

     2. With respect to each Employee Benefit Plan and each Foreign Plan, the Company
has made available to Buyer true and complete copies, if applicable, of: (i) all plan documents,
including all amendments thereto (or, if not written, a written summary of its material terms);
(ii) all summary plan descriptions, including any summary of material modifications; (iii) the
three most recent annual reports (Form 5500 series) filed with the Internal Revenue Service; (iv)
the most recent determination or prototype opinion letter, if any, issued by the Internal Revenue
Service; (v) any related trust or funding agreement; (vi) the most recent actuarial report or other
financial statement, if any; and (vii) all material filings made with any governmental entity
during the prior three years, including but not limited to any filings under the Voluntary
Compliance Resolution System or Closing Agreement Program, the Department of Labor Delinquent Filer
Voluntary Compliance Program, or the Department of Labor Voluntary Fiduciary Correction Program.
Additionally, the Company has made available to Buyer true and complete copies, if applicable, of
any agreement with any current or, to the extent that the Company continues to have obligations
under such agreement, former employee, director or consultant that provides for a gross-up or make
whole payment with respect to any Tax, including those imposed by Section 409A and 4999 of the
Code.

     3. Each Employee Benefit Plan that is intended to qualify under Section 401(a) of
the Code, and each Foreign Plan that is intended to qualify under the applicable local law for a
tax-advantaged pension benefit to participants (each a “Qualified Plan”) either (i) has
received a favorable determination letter from the Internal Revenue Service as to its qualified
status or has received approval under applicable local law (or, where approval is not required
under local law, satisfies all requirements under applicable law and so qualifies), or (ii) may
rely upon a prototype opinion letter from the Internal Revenue Service. To the Company’s knowledge, no fact or event has occurred that could reasonably be expected to
cause the loss of such qualified status. 

     4. Except as set forth on Schedule IV.L.4, none of the Company or any of
its Subsidiaries contributes to, has any obligation to contribute to, or has, within the past six
years, contributed to or had any obligation to contribute to, any Title IV Plan or any
Multiemployer Plan.

     5. Except as set forth on Schedule 4.12(e) and as would not result in a
material liability to the Company, the Company and its Subsidiaries have timely made all
contributions required to be made by them under the terms of any Employee Benefit Plan or Foreign
Plan or, if not yet due, such contributions have been properly reflected on the most recent
consolidated balance sheet filed or incorporated by reference in the financial statements of the
Company or any its Subsidiaries, as applicable, in accordance with applicable law. 

     6. Neither the Company, its Subsidiaries, nor, to the Company’s knowledge, any
third party has engaged in a prohibited transaction (within the meaning of Section 406 of ERISA or
Section 4975 of the Code and other than a transaction that is exempt under a statutory or
administrative exemption) with respect to any Employee Benefit Plan that could result in material
liability to the Company.

     7. Except as set forth on Schedule IV.L.6, no Employee Benefit Plan
provides any of the following retiree or post-employment benefits to any Person: medical, dental or
life insurance benefits, other than (i) coverage mandated by applicable law, (ii) death, disability
or retirement benefits under any Employee Benefit Plan which is an employee pension benefit plan
within the meaning of Section 3(2) of ERISA, or (iii) benefits, the full cost of which is borne by
the current or former employee (or his or her beneficiary). Except as would not result in material
liability 

14

 

to the Company, no Employee Benefit Plan is a “multiple employer welfare arrangement”
within the meaning of Section 3(40) of ERISA.

     8. Except as would not result in material liability to the Company, each
individual who renders services to the Company or its Subsidiaries and is classified as having the
status of an independent contractor, consultant or other non-employee status is properly classified
for all purposes, including eligibility to participate in the Employee Benefit Plans.

     9. Except as set forth on Schedule IV.L.9, neither the execution and
delivery of this Agreement nor the consummation of the transactions contemplated hereby will, alone
or together with the occurrence of any subsequent event, result in any payment, acceleration of the
time of payment or vesting of any benefits otherwise payable by the Company, or increase any such
benefits to any employee or other service provider of the Company or its Subsidiaries.

     10. No amount that could be received as a result of or in connection with the
consummation of the transactions contemplated by this Agreement by any employee, officer, director
or other service provider of the Company or any of its Subsidiaries who is a “disqualified
individual” (as such term is defined in Treasury Regulation Section 1.280G-1) could reasonably be
expected to be an “excess parachute payment” (as defined in Section 280G(b)(1) of the Code).

     11. Except as set forth on Schedule 4.12(k) and as would not result in a
material liability to the Company, no payment or benefit pursuant to any Employee Benefit Plan,
Foreign Plan or other agreement between the Company and/or its Subsidiaries and any “service
provider” (as such term is defined in Section 409A of the Code and the U.S. Treasury Regulations
and Internal Revenue Service guidance thereunder) would subject any Person to tax pursuant to
Section 409A of the Code, whether pursuant to the transactions contemplated in this Agreement or
otherwise. 

     12. With respect to each Foreign Plan, except as set forth on Schedule
4.12(l), no liability exists or reasonably could be imposed upon the assets of either of the
Company or its Subsidiaries by reason of such Foreign Plans, other than those existing in
connection with the enforcement of the Foreign Plans pursuant to the laws of the jurisdiction in
which the Company or the relevant Subsidiary operates. For purposes of this Agreement,
“Foreign Plan” means any material agreement, plan, program, fund, policy, contract or
arrangement (either written or unwritten) providing compensation, benefits, pension, retirement,
superannuation, profit sharing, stock bonus, stock option, stock purchase, phantom or stock
equivalent, bonus, thirteenth month, incentive, deferred compensation, hospitalization, medical,
dental, vision, vacation, insurance, sick pay, disability, severance, termination indemnity,
redundancy pay, educational assistance, holiday pay, housing assistance, moving expense
reimbursement, fringe benefit or similar employee benefits covering any employees of the Company or
any of its Subsidiaries who work primarily outside of the United States, and the beneficiaries and
dependents of such employees, regardless of whether such agreement, plan, program, fund, policy,
contract or arrangements is mandated under local law, private, funded, unfunded, financed by the
purchase of insurance, contributory or non-contributory, other than an Employee Benefit Plan.

     M. Insurance. Schedule M(a) sets forth a true and complete list of all current
insurance policies maintained by the Company and its Subsidiaries. All of such insurance policies
are in full force and effect, and, to the Company’s knowledge, neither the Company nor any
Subsidiary of the Company is in default in any material respect with respect to its
obligations under any of such insurance policies. All premiums due and payable under all such
policies have been paid. No written notice of cancellation, termination or non-renewal has been
received by the Company or any Subsidiary of the Company with respect to any such policy, nor, to
the Company’s knowledge, has the Company or any Subsidiary of the Company been denied insurance
coverage within the three years prior to the date of this Agreement. Since the last renewal date
of any insurance policy, the Company and its Subsidiaries have not received written notice of any
material change in the relationship of the Company or any Subsidiary of the Company with their
respective insurers or the premiums payable pursuant to such policies. Except as set forth on
Schedule M(b), there are no outstanding unpaid claims under any such policy. Such polices
are sufficient in all material respects for compliance with applicable law and all contracts to
which any of the Company or any Subsidiary of the Company is a party and neither the Company nor
any of its Subsidiaries has experienced claims in excess of current coverage of such insurance.

     N. Compliance with Laws, Export Controls, Import Laws, Foreign Corrupt Practices Act, and
other Applicable Anti-Bribery/Anti-Corruption Laws. Except as set forth on Schedule
N, the Company and its Subsidiaries are in compliance in all material respects with all laws
and regulations of foreign, federal, state, provincial and local governments and all agencies
thereof to which the Company or its Subsidiaries are subject. None of the Company, its
Subsidiaries or any director, officer, agent, employee or other Person acting on behalf of any of
the Company or any of its Subsidiaries (in their capacity as director, officer, agent, or
employee), has at any time during the last five years prior to the date hereof (or, with respect to
any Subsidiary of the Company that was acquired after such date, such later date on which such
Subsidiary was acquired): (i) used any corporate funds of the Company or any of its Subsidiaries
for unlawful contributions, gifts, entertainment or other unlawful expenses relating to political
activity; (ii) made any direct or indirect unlawful payments to government officials or employees
from corporate funds, or established or maintained any unlawful or unrecorded funds; (iii) made any
unlawful payment or given any other unlawful consideration to any customer or supplier of the
Company or its Subsidiaries or any director, officer, agent, or employee of such customer or
supplier or (iv) violated or is in violation of any provision of the Foreign Corrupt Practices Act
of 1977, as amended. Except as set forth on Schedule N, neither the Company nor any
Subsidiary of the Company has, at any time during the last five years prior to the date hereof (or,
with respect to any Subsidiary of the Company that was acquired after such date, such later date on
which such Subsidiary was acquired), received any notice, action or assertion from any governmental
authority, nor, to the Company’s knowledge, has

15

 

otherwise been advised that any notice, action or
assertion has been filed, commenced or threatened in writing against the Company or any Subsidiary
of the Company alleging that the Company or any Subsidiary of the Company is not in material
compliance with any applicable laws or orders, judgments, injunctions or decrees. This includes,
but is not limited to, being in compliance in all materials respects with the laws and regulations
governing the export of controlled articles, technology and services subject to the Arms Export
Control Act of 1978 (as amended) and the International Traffic in Arms Regulations, the Export
Administration Act of 1979 (as amended) and the Export Administration Regulations, as well as
similar laws and regulations governing the exportation of controlled articles, technology and
services in the jurisdictions in which the Subsidiaries are located. The Company and its
Subsidiaries are in compliance in all material respects with applicable laws and regulations
governing the importation of goods in the jurisdictions in which they are located. No
representation or warranty is made in this Section IV.N with respect to compliance with
laws or notices from governmental authorities relating to matters covered by Section IV.O.

     O. Environmental Matters. Except as set forth on Schedule IV.O:

     1. The Company and its Subsidiaries are, and within the two years prior to the
date of this Agreement were, in material compliance with all applicable Environmental
Requirements.

     2. The Company and its Subsidiaries have all material permits, licenses and other
authorizations required under applicable Environmental Requirements, and necessary for the
ownership, lease, operation or use of the business or assets of the Company and its Subsidiaries.
The Company and its Subsidiaries are in compliance with all permits, licenses and authorizations,
required under applicable Environmental Requirements, and necessary for the ownership, lease,
operation or use of the business or assets of the Company and its Subsidiaries. With respect to any
permits, licenses and other authorizations required under this Section IV.O.2, the Company
will use commercially reasonable efforts to facilitate transferability of the same, and neither the
Company nor the Seller is aware of any condition, event or circumstance that might prevent or
impede the transferability of the same, nor have they received any written notice regarding any
material adverse change in the status or terms and conditions of the same.

     3. Neither the Company nor any of its Subsidiaries has, within the two years
prior to the date of this Agreement, received any written notice (including, without limitation,
actions, suits and proceedings, governmental orders, Liens, fines, penalties, or, as to each, any
settlement or judgment arising therefrom) from any government entity or any other Person alleging
liability under any Environmental Requirements or responsibility for the costs of enforcement
proceedings, investigations, cleanup, governmental response, removal or remediation, natural
resources damages, property damages, personal injuries, medical monitoring, penalties,
contribution, indemnification and injunctive relief, arising out of, based on or resulting from the
presence, Release of, or exposure to, any Hazardous Materials or any actual or alleged
non-compliance with any Environmental Requirement or term or condition of any permit, license or
other authorization, relating to the Company, its Subsidiaries or their current or former
facilities (whether owned, operated or leased), and to the Company’s knowledge, no such notice is
threatened.

     4. None of the Company and its Subsidiaries has, within the two years prior to
the date of this Agreement, Released, disposed of or arranged for the Release or disposal of any
Hazardous Material in a manner or to a location that has, or could reasonably be expected to,
result in material liability to the Company or any of its Subsidiaries under any Environmental
Requirement. 

     5. The Company has made available to Buyer all environmental reports, studies,
audits, records, sampling data, site assessments and risk assessments in its possession and control
regarding owned and leased facilities of the Company and its Subsidiaries. 

     6. To the Company’s knowledge, there is no asbestos or asbestos-containing
material located at, on, under or in the Owned Real Property or the Leased Real Property.

     7. (i) Since May 20, 2003 (or, with respect to any Subsidiary of the Company,
asset, operation or other aspect of the Company’s business that was acquired by the Company after
such date, such later date on which such Subsidiary, asset, operation or other aspect of the
Company’s business was acquired), and (ii) for all prior periods, to the knowledge of the Company
based solely on the results of the review of readily available records of the Company and its
Subsidiaries, neither the Company nor any of its Subsidiaries has directly incorporated any
asbestos or parts containing asbestos into any of its products.

     P. Affiliated Transactions. Except (i) as set forth on Schedule IV.P, (ii)
pursuant to any Employee Benefit Plan or Foreign Plan, or (iii) as otherwise disclosed in this
Agreement (including the Disclosure Schedule) (any of the foregoing, a “Related Person
Transaction”), no Related Person (other than the Company, any of its Subsidiaries, Wells Fargo
& Co. and its Affiliates acting in a role that is not associated with Norwest Equity Partners, or
General Electric Company and its Affiliates) is presently or at any time during the past one year
has been a party to any material agreement, contract, commitment or transaction with the Company or
any of its Subsidiaries or has any interest in any material property used by the Company or its
Subsidiaries (other than any such agreement, contract, transaction or commitment relating to
services to be provided to the Company that was entered into on an arm’s length basis and in the
ordinary course of business). All Related Person Transactions have been and are on an arms-length
basis providing for substantially the same payment and performance terms as would reasonably be
expected to be negotiated with an independent third party. Except as set forth on Schedule
IV.P, there is no outstanding amount in excess of $50,000 owing (including, without limitation,
pursuant to any advance, note or other indebtedness instrument) from the Company or any Subsidiary
of the Company to any Related Person identified on Schedule IV.P or from any Related Person
identified on Schedule IV.P to the Company or any Subsidiary of the Company.

16

 

     Q. Employees.

     1. Except as would not result in a material liability to the Company, the Company
and its Subsidiaries are in compliance with all applicable laws and their own policies respecting
labor, employment and immigration matters, including but not limited to fair employment practices,
terms and conditions of employment, workers’ compensation, occupational safety, plant closings,
compensation and benefits, wages and hours, labor rights, employee leaves, use or treatment of
temporary employees, independent contractors or consultants, expatriate arrangements, international
assignments and/or secondments, data protection and other employment terms and conditions.

     2. Except as set forth on Schedule 4.09 or Schedule 4.17(b): (i)
neither the Company nor any Subsidiary of the Company has experienced any strike, picketing,
slowdown, work stoppage or lockout within the past three years, nor to the Company’s knowledge is
any such action threatened; (ii) neither the Company nor any Subsidiary of the Company has
experienced any material grievance, claim of unfair labor practices, or other material collective
bargaining dispute within the past two years that has not been dismissed or settled; (iii) since
January 1, 2008, neither the Company nor any Subsidiary of the Company has experienced any
organizational effort, organizing, election or other activity by or on behalf of any union, works
council, labor organization or other employee representative group with respect to employees of the
Company or any of its Subsidiaries, nor to the Company’s knowledge is any such action threatened;
(iv) no collective bargaining, works council or similar agreement with any union, works council,
labor organization or other employee representative group is in effect with respect to the Company
or any Subsidiary of the Company, and neither the Company nor any Subsidiary of the Company is
negotiating any such agreement in respect of employees of the Company or its Subsidiaries; and (v)
there is no union, works council, labor organization or other employee representative group which,
pursuant to applicable law or any applicable agreement, must be notified, consulted or with which
negotiations need to be conducted in connection with the transactions contemplated by this
Agreement.

     3. Neither the Company nor any Subsidiary of the Company is delinquent in any
material payments to any of its employees for any wages, salaries, commissions, bonuses or other
direct compensation for any services performed for it or amounts required to be reimbursed to such
employees. Each of the Company and its Subsidiaries have withheld all amounts required by law to
be withheld from the wages, salaries, and other payments to any employees. 

     4. Except as set forth on Schedule IV.Q.4, there are no material
controversies pending or, to the knowledge of the Company, threatened in writing relating to an
alleged violation or breach by the Company or any Subsidiary of the Company of any laws relating to
employment, labor or immigration. To the Company’s knowledge, no employee of the Company or any
Subsidiary of the Company is in any material respect in violation of any term of any employment
contract, non-disclosure agreement, noncompetition agreement, or any restrictive covenant to a
former employer relating to the right of any such employee to be employed by the Company or any
Subsidiary of the Company because of the nature of the business conducted or presently proposed to
be conducted by it or to the use of trade secrets or proprietary information of others. No key
employee of the Company or any Subsidiary of the Company has given written notice that such
employee intends to terminate his or her employment with the Company or such Subsidiary.

     5. Since January 1, 2008, neither the Company nor any Subsidiary of the Company
has effectuated a plant closing, layoff, collective dismissal or other employment dismissals that
could implicate the Worker 
Adjustment and Retraining Notification Act of 1988, as amended (or any similar foreign,
state or local law, statute, rule or regulation, “WARN”), and no such action will be
implemented without advance notification to Buyer.

     R. Brokerage. Except as set forth on Schedule IV.R, no broker, finder,
financial advisor, investment banker or other Person is entitled to any brokerage commissions,
finders’ fees or similar compensation in connection with this Agreement or the transactions
contemplated by this Agreement based on any arrangement or agreement made by or on behalf of the
Company or any of its Subsidiaries.

     S. Governmental Licenses and Permits. Schedule IV.S contains a list of all
material permits, licenses, approvals, authorizations, consents, and franchises of governmental
entities (collectively, the “Licenses”) owned or possessed by the Company or its
Subsidiaries and no other such permits, licenses, approvals, authorizations, consents, and
franchises of governmental entities are required in the conduct of their respective businesses or
used by the Company and its Subsidiaries in the conduct of their businesses. All of such Licenses
held by or issued to the Company and the Subsidiaries of the Company are in full force and effect,
and the Company or the respective Subsidiary that is a party thereto is in compliance in all
material respects with each such License held by or issued to it. No action is pending, nor to the
Company’s knowledge is threatened, to suspend, revoke, revise, limit, restrict or terminate any of
such Licenses or declare any such License invalid. No representation is made herein with respect
to any such Licenses covered by Section IV.O.2.

     T. Customers and Suppliers.

     Schedule IV.T contains a list of (i) the ten largest suppliers of the Company and
its Subsidiaries, based on the dollar amount of consolidated purchase orders by the Company and its
Subsidiaries, and (ii) the ten largest customers of the Company and its Subsidiaries, based on the
dollar amount of consolidated revenues earned by the Company and its Subsidiaries, in each case,
for the fiscal year ended December 31, 2010. Except as set forth on Schedule IV.T, (i)
none 

17

 

of the suppliers or customers set forth on Schedule IV.T has informed the Company or
any Subsidiary of the Company in writing that it intends to terminate or materially reduce its
relationship with the Company or any Subsidiary of the Company, and (ii) to the Company’s
knowledge, none of such suppliers or customers intends to terminate or materially reduce such
relationship or has advised the Company or any Subsidiary of the Company of any material problem or
dispute with any such supplier or customer. 

     U. Accounts Receivable. All of the Accounts Receivable of the Company and its
Subsidiaries are bona fide receivables, are reflected on the books and records of the Company or
the applicable Subsidiary, as applicable, and arose in the ordinary course of business. Except for
Permitted Liens, accounts receivable reserves, or as set forth on Schedule IV.U, the
Accounts Receivable are free and clear of Liens, there is no right of offset against any of the
Accounts Receivable, and no agreement for deduction or discount has been made with respect to any
of the Accounts Receivable other than ordinary course trade discounts.

     V. Inventory. Except as set forth on Schedule IV.V, (a) all of the Inventory is
owned by the Company or the Subsidiaries of the Company, as applicable, free and clear of any Liens
(other than Permitted Liens) and is located at the Owned Real Property or the Leased Real Property,
(b) none of the Inventory is on consignment and (c) the Inventory as reflected in the Financial
Statements has been valued in a manner consistent with past practices and procedures (including,
without limitation, the method of computing overhead and other indirect expenses to be applied to
inventory) and in accordance with GAAP. Except for damaged, obsolete, or excess Inventory, the
Inventory owned by the Company and the Subsidiaries of the Company is usable and saleable in the
ordinary course of business, subject to the reserve for Inventory that will be set forth in the
Closing Balance Sheet and/or the Closing Statement and included in the Net Working Capital Amount.

     W. Product Warranty. Substantially all of the products manufactured, sold, leased, and
delivered by the Company and its Subsidiaries are subject to standard terms and conditions of sale
or lease. Except as set forth on Schedule IV.W, the Company has not received any written,
or to the knowledge of the Company, other notice of any defect in workmanship or materials with
respect to any products of the Company which might give rise to a material product warranty or
product liability claim subsequent to the Closing Date.

     X. No Other Representations. Except for the representations and warranties contained in
III and this IV, none of the Company, its Subsidiaries, any Seller or any other
Person makes any express or implied representation or warranty in respect or on behalf of the
Company, its Subsidiaries or any Seller, and each of the Company and each Seller disclaims any such
representation or warranty, whether by a Seller, the Company or any Subsidiary of the Company or
any of their respective officers, directors, employees, agents or representatives or any other
Person, with respect to the execution and delivery of this Agreement or the consummation of the
transactions contemplated hereby or the business or assets of the Company and its Subsidiaries,
notwithstanding the delivery or disclosure to Buyer or any of its officers, directors, employees,
agents or representatives or any other Person of any documentation or other information with
respect to the foregoing.

V.

REPRESENTATIONS AND WARRANTIES OF BUYER

Buyer represents and warrants to the Sellers and the Company as of the date hereof that:

     A. Organization and Authority. Buyer is a Delaware corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware, with all requisite corporate
power and authority and full legal capacity to execute and deliver this Agreement and the Escrow
Agreement and perform its obligations hereunder and thereunder.

     B. Authorization; Valid and Binding Agreement. Buyer has all requisite corporate power
and authority to execute and deliver this Agreement and the Escrow Agreement, to perform its
obligations hereunder and thereunder and to consummate the transactions contemplated hereby and
thereby. This Agreement and the Escrow Agreement have been duly authorized, and each of this
Agreement has been and, as of the Closing, the Escrow Agreement will be, duly executed and
delivered by Buyer, and no other corporate action on the part of Buyer is necessary to authorize
the execution and delivery of this Agreement and the Escrow Agreement by Buyer, the performance by
Buyer of its obligations hereunder and thereunder or the consummation by Buyer of the transactions
contemplated by this Agreement and the Escrow Agreement. Assuming that (i) this Agreement is a
valid and binding obligation of the Company, each Seller and the Seller Representative and (ii) the
Escrow Agreement will be a valid and binding obligation of the Seller Representative and the Escrow
Agent, this Agreement constitutes and the Escrow Agreement will constitute as of the Closing valid
and binding obligations of Buyer, enforceable in accordance with their terms, except as
enforceability may be limited by bankruptcy laws, other similar laws affecting creditors’ rights
and general principles of equity affecting the availability of specific performance and other
equitable remedies.

     C. No Breach. Except (i) with respect to clauses (1)(y), and (2) below, where the
failure of any of the following to be true would not materially affect the ability of Buyer and the
Company to operate the business of the Company and its Subsidiaries, after the Closing, in the
ordinary course and consistent with past practices, and (ii) for the applicable requirements of the
HSR Act and the Foreign Equivalents and approval of the French Ministry of Economy pursuant to the
French Legal Requirement, the execution, delivery and performance of this Agreement and the Escrow
Agreement by Buyer and the consummation of the transactions contemplated hereby and thereby do not
(1) result in any breach of, constitute a default under, result in a violation of, result in the
creation of any Lien (other than a Permitted Lien) upon any asset or property of Buyer, or give
rise to any third-party rights of termination or amendment or to a loss of a material benefit to
which Buyer is entitled, (x) under the provisions of Buyer’s articles of incorporation or bylaws or
equivalent organizational documents, (y) under any indenture, mortgage, lease, loan agreement or
other agreement or instrument to which Buyer is bound, or any law, statute or regulation or (z)
under any order, judgment or decree to which Buyer is subject, or (2) require any permit,
authorization, consent or approval by, filing with or notice or declaration to any court or other
governmental body.

18

 

     D. Litigation. As of the date of this Agreement, there are no actions, suits or
proceedings pending or, to Buyer’s knowledge, threatened against Buyer at law or in equity, or
before or by any federal, state, municipal or other governmental department, commission, board,
bureau or agency, domestic or foreign, which if determined adversely to Buyer would, individually
or in the aggregate, reasonably be expected to prevent, materially impede, interfere with, hinder
or delay the consummation by Buyer of the transactions contemplated under this Agreement or the
Escrow Agreement, and Buyer is not subject to any material outstanding judgment, order or decree of
any court or governmental body.

     E. Investment. Buyer is purchasing the Units for investment for its own account and not
with a view to, or for sale in connection with, any distribution of such Units in violation of
federal and state securities Legal Requirements. Buyer is an “accredited investor” as defined in
Regulation D promulgated under the Securities Act of 1933 (the “Securities Act”), as amended, and
has sufficient knowledge and experience in financial and business matters so as to be capable of
evaluating the merits and risks of its investment in the Units and is capable of bearing the
economic risks of such investment. Buyer acknowledges that the Units have not been registered
under the Securities Act or the Securities and Exchange Act of 1934 (the “Exchange Act”) or
any state or foreign securities Legal Requirements and that the Units may not be sold, transferred,
offered for sale, pledged, hypothecated or otherwise disposed of unless such sale, transfer, offer,
pledge, hypothecation or other disposition is pursuant to the terms of an effective registration
statement under the Securities Act and are registered under any applicable state or foreign
securities Legal Requirements or pursuant to an exemption from registration under the Securities
Act or the Exchange Act and any applicable state or foreign securities Legal Requirements.

     F. Brokerage. No broker, finder, financial advisor, investment banker or other Person
is entitled to any brokerage commissions, finders’ fees or similar compensation in connection with
this Agreement, the transactions contemplated by this Agreement or the Escrow Agreement based on
any arrangement or agreement made by or on behalf of Buyer.

     G. Knowledge of Buyer. Except, to the extent applicable, for the Specific
Indemnification Items set forth on Schedule IX.B.1(v), Buyer has no knowledge of the
existence or nonexistence or occurrence or nonoccurrence of any event, condition or circumstance
the existence, nonexistence, occurrence or nonoccurrence of which would cause any representation or
warranty of the Company or any Seller contained in this Agreement to be untrue.

     H. No Other Representations. Except for the representations and warranties contained in
this V, neither Buyer nor any other Person makes any express or implied representation or
warranty in respect or on behalf of Buyer, and Buyer disclaims any such representation or warranty,
whether by Buyer or any of its officers, directors, employees, agents or representatives or any
other Person, with respect to the execution and delivery of this Agreement or the consummation of
the transactions contemplated hereby or the business or assets of Buyer, notwithstanding the
delivery or disclosure to the Company or any of its Subsidiaries or any of their officers,
directors, employees, agents or representatives or any other Person of any documentation or other
information with respect to the foregoing.

VI.

PRE-CLOSING COVENANTS

     A. Conduct of Business. 

     1. From the date of this Agreement until the Closing, except as (i) otherwise
provided for or contemplated by this Agreement, (ii) otherwise provided for or contemplated by the
Company’s Operating Budget for the fiscal year 2011, (iii) as set forth on Schedule A, (iv)
required by law or regulation or (v) consented to in writing by Buyer (which consent shall not be
unreasonably withheld), the Company shall, and shall cause each of its Subsidiaries to conduct its
respective businesses in the ordinary course in substantially the same manner as previously
conducted and, to the extent consistent therewith, use reasonable efforts to keep intact its
respective businesses, keep available the services of its current employees and preserve its
relationships with customers, suppliers, licensors, licensees, distributors and others with whom it
deals such that its respective businesses shall be unimpaired.

     2. From the date of this Agreement until the Closing, except as (i) otherwise
provided for or contemplated by this Agreement, (ii) otherwise provided for or contemplated by the
Company’s Operating Budget for the fiscal year 2011, (iii) as set forth on Schedule A, (iv)
required by law or regulation or (v) consented to in writing by Buyer (which consent shall not be
unreasonably withheld), the Company shall not and shall not permit any of its Subsidiaries to take
any of the actions that would have been required to be disclosed on Schedule IV.F.2
(without regard to the dollar thresholds contained in Section IV.F.2) if such actions had
taken place prior to the date of this Agreement. 

     3. Notwithstanding the provisions in Sections VI.A.1 or 2 above,
Section 0, or any other provision in this Agreement, nothing in this Agreement from the
date hereof until the Closing Date shall restrict or otherwise prohibit the Company or its
Subsidiaries from declaring, setting aside or paying any dividends or making any other
distributions with respect to any of its Units, including, but not limited to, making any payments
or taking any other actions permitted pursuant to Section VII.G hereof.

     B. Access to Books and Records. The Company shall provide Buyer and its authorized
representatives (the “Buyer’s Representatives”) with reasonable access to the offices,
properties, appropriate officers, books and records of the Company and its Subsidiaries as Buyer
may from time to time reasonably request; provided, however, that the Company may
refuse to provide the Buyer’s Representatives access if such access may unreasonably interfere

19

 

with
any of the businesses or operations of the Company or any of its Subsidiaries; provided
further that nothing herein shall permit Buyer or the Buyer’s Representatives to take
samples of materials or substances or to conduct any Phase I, Phase II or other environmental
report or investigation in, on, or in the immediate vicinity of the Company’s assets or properties.
Buyer acknowledges that it remains bound by the Confidentiality Agreement. Notwithstanding the
foregoing, Buyer agrees and acknowledges that it will not be provided access to any information
that is related to any current dispute between the Company or its Subsidiaries, on the one hand,
and Buyer or its Affiliates, on the other hand, or which is otherwise protected by attorney-client
privilege. 

     C. Consents. The Company and Buyer shall use commercially reasonable efforts to obtain all
authorizations, consents and approvals of, and give all notices to be obtained or given in
connection with the transactions contemplated hereby to all third parties required under the
contracts set forth as items 2, 3, 4, 6, 7, 8, 9 on Schedule IV.C(b)(1); provided
that, notwithstanding anything in this Agreement to the contrary, for avoidance of doubt,
the “commercially reasonable efforts” of Sellers (or any Seller), the Company (prior to Closing)
and/or any Subsidiary of the Company (prior to Closing) with respect to obtaining any third party
authorizations, consents or approvals shall not require any of them to expend any money or agree to
any amendment, waiver or other consideration that would be effective if the Closing did not occur
in order to obtain any such third party authorizations, consents or approvals. The Company and
Buyer shall coordinate and cooperate with each other in exchanging such information and assistance
as the other may reasonably request in connection with the obligations set forth in the preceding
sentence. Neither the Company and Sellers, on the one hand, nor Buyer, on the other hand, shall
have any liability whatsoever arising out of or relating to the failure to obtain any consents from
any Person or because of the termination of any contract as a result thereof except to the extent
of its noncompliance with its obligations contained in this Section 6.03. No
representation, warranty, covenant or agreement of the Company or Sellers, on the one hand, nor
Buyer, on the other hand, shall be breached, and no closing condition set forth in Section
II.B shall be deemed unsatisfied, as a result of (i) the failure to obtain any such consent or
any such termination, or (ii) any proceeding commenced or threatened by or on behalf of any Person
arising out of or relating to the failure to obtain any such consent or because of any such
termination.

     D. Exclusivity . Until the earlier of the Closing Date and the date upon which, if any, this Agreement
is terminated pursuant to its terms, Sellers will not, and will not cause or permit the Company or
any of its Subsidiaries to, (i) solicit, initiate, or encourage the submission of any proposal or
offer from any Person relating to the acquisition of the Units or any other equity interests, or
any substantial portion of the assets, of the Company or any of its Subsidiaries (including any
acquisition structured as a merger or consolidation) or (ii) participate in any discussions or
negotiations regarding, provide any information with respect to, assist or participate in, or
facilitate in any other manner any effort or attempt by any prospective acquiror to do or seek any
of the foregoing, other than Buyer, its Affiliates and their representatives.

     E. Data Room Materials. The Company shall deliver or cause Merrill Corporation to deliver to
Buyer, within 10 days after the date of this Agreement, CDs or substantially similar electronic
copies of all of the materials posted to the electronic data room maintained by the Company at
https:/datasite.merrillcorp.com on or prior to the time that this Agreement is executed by the
parties hereto. 

     F. Updates to Schedule 4.04. Notwithstanding anything to the contrary contained herein, the
parties hereto agree and acknowledge that in the event that any changes are required to be made to
Schedule IV.D (solely with respect to the ownership of the Units by Sellers as set
forth on such schedule) between the date hereof and the Closing Date, such schedule shall be
updated and all references in this Agreement to Schedule IV.D shall be to such schedule as
so updated; provided that it shall be a condition to (i) any such update that if the
purpose of such update is to document a transfer of Units, by operation of law, or otherwise, and
(ii) any such transfer of Units, in each case, that any transferee not already a party to this
Agreement as a Seller shall become party to this Agreement in such capacity.

     G. Remaining Due Diligence. Schedule G sets forth certain items with respect to
which additional information has been requested by Buyer. The Company agrees to use commercially
reasonable efforts to supply such additional information to Buyer’s reasonable satisfaction prior
to Closing. Buyer agrees to pay any third party costs to acquire an owner’s title insurance policy
(leasehold and/or fee, as applicable) for the Albuquerque, New Mexico facility.

VII.

ADDITIONAL COVENANTS

     A. Access to Books and Records. From and after the Closing, Buyer shall, and shall
cause the Company and its Subsidiaries to, provide the Seller Representative, Sellers and their
authorized representatives with reasonable access (for the purpose of examining and copying),
during normal business hours, to the books and records of the Company and its Subsidiaries with
respect to periods prior to the Closing Date to the extent reasonably required in connection with
enforcing rights or complying with obligations under this Agreement, disputing any indemnification
or other claim pursuant to this Agreement, complying with Legal Requirements or for purposes of
completing any Tax filings of Sellers or responding to any audit, inquiry or action by a third
party relating to the Company or any of its Subsidiaries. Unless otherwise consented to in writing
by the Seller Representative, Buyer shall use its commercially reasonable efforts to cause the
Company or any of its Subsidiaries not to, for a period of six years following the Closing Date
(subject to the provisions of Section 0 with

20

 

respect to books and records relating to Tax
matters), destroy, alter or otherwise dispose of any of its books and records, or any portions
thereof, relating to periods prior to the Closing Date and to the extent reasonably relating to (i)
enforcing rights or complying with obligations under this Agreement, (ii) any indemnification claim
or other claim, (iii) compliance with Legal Requirements, or (iv) any Tax filings of Sellers or any
audit, inquiry or action by a third party relating to the Company or any of its Subsidiaries, in
each case, without first giving reasonable prior written notice to the Seller Representative.
Except in connection with uses contemplated by this Agreement, the Seller Representative and its
agents shall hold in confidence to the same extent as provided for in the Confidentiality Agreement
as if such Seller Representative and its agents were deemed to be bound by reciprocal
confidentiality obligations, all information relating to the Company and its Subsidiaries and their
businesses obtained pursuant to this Section VII.A.

     B. Director and Officer Liability and Indemnification. 

     1. For a period of five years after the Closing, Buyer shall cause the Company
and its Subsidiaries to continue to indemnify and hold harmless each present and former director
(or member of the management committee or similar governing body) and officer of the Company and
its Subsidiaries against any costs or expenses (including reasonable attorneys’ fees), judgments,
fines, losses, claims, damages or liabilities of any nature whatsoever, incurred in connection with
any claim, action, suit, proceeding or investigation, whether civil, criminal, administrative or
investigative, arising out of or pertaining to matters existing or occurring at or prior to
Closing, whether asserted or claimed prior to, at or after the Closing, to the fullest extent of
the law provided under the Company’s or such Subsidiary’s certificate or articles of incorporation
or bylaws (or other organizational documents) in effect on the date hereof or to the fullest extent
permitted by law.

     2. For a period of five years after the Closing, Buyer shall not, and shall not
permit the Company or any of its Subsidiaries to, amend, repeal or modify any provision in the
Company’s or such Subsidiary’s certificate or articles of incorporation or bylaws (or other
organizational documents) relating to the exculpation or indemnification of any officers and
directors or members of the management committee or similar governing body (unless required by
law), it being the intent of the parties that the officers and directors (or members of the
management committee or similar governing body) of the Company and its Subsidiaries shall continue
to be entitled to such exculpation and indemnification to the full extent of the law.

     3. The Company shall choose and obtain at Closing, at Buyer’s expense, a prepaid
policy or policies (i.e., “tail coverage”) which policy or policies provide those Persons who are
currently covered by the Company or its Subsidiaries’ directors’ and officers’ liability insurance
policies (copies of which have been heretofore made available by the Company to Buyer and its
agents and representatives) with coverage in amount and scope at least as favorable as the
Company’s existing coverage for an aggregate period of not less than five years with respect to
claims arising from facts or events that occurred on or before the Closing Date, including with
respect to the transactions contemplated by this Agreement. Notwithstanding anything to the
contrary in subsections 1 and 2 of this Section VII.B or in the
organizational documents of the Company and its Subsidiaries, the Company’s and its Subsidiaries’
obligations to indemnify the Sellers pursuant to Section VII.B or the organizational
documents of the Company and its Subsidiaries shall be limited to the insurance proceeds of the
tail coverage described in this Section VII.B.3.

     4. In the event that after the Closing Date, Buyer or the Company, or their
respective successors or assigns, (i) consolidates with or merges into any other Person and shall
not be the continuing or surviving corporation or entity in such consolidation or merger or (ii)
transfers all or substantially all of its properties and assets to any Person, then, and in each
case, proper provision shall be made so that the successors and assigns of Buyer or the Company, as
the case may be, honor the indemnification and other obligations of such Persons, including under
this Section VII.B.4.

     5. Nothing in this Section 7.02 shall be construed to provide any Seller
with a claim for indemnification against the Company with regard to any matter as to which the
Sellers would be liable to indemnify Buyer hereunder (determined without regard to baskets, caps or
survival periods), and each Seller hereby waives any right to indemnification with respect
thereto.

     C. Regulatory Filings.

     1. Buyer shall, and the Company shall cooperate with Buyer to, (i) use reasonable
best efforts to make or cause to be made all filings and submissions under the Foreign Equivalents
thereof and any other laws or regulations applicable to Buyer and the Company as may be required of
Buyer and the Company for the consummation of the transactions contemplated herein, and (ii) use
reasonable best efforts to secure the termination of any waiting periods under the Foreign
Equivalents. Buyer shall be responsible for all filing fees under all Foreign Equivalents and
approval of the French Ministry of Economy pursuant to the French Legal Requirements, in each case,
set forth on Schedule II.A.1, and any other filing made in accordance with clause (i)
above.

     2. In furtherance and not in limitation of the terms of Section VII.C.1
above, to the extent required by applicable law, Buyer and the Company shall (i) supply promptly
any information and documentary material that may be requested by any governmental authority
pursuant to the Foreign Equivalents (each, a “Foreign Authority”), (ii) cooperate in
connection with any filing under applicable antitrust laws and in connection with resolving any 

21

 

investigation or other inquiry concerning the transactions contemplated by this Agreement commenced
by any Foreign Authority, and (iii) cooperate with any Foreign Authority pursuant to the Foreign
Equivalents.

     3. In furtherance and not in limitation of the terms of Section VII.C.1
above, Buyer and the Company shall cooperate in good faith with any Foreign Authority and undertake
promptly any and all commercially reasonable actions required to cause the expiration or
termination of the applicable waiting periods with respect to the approval of the transactions
contemplated by this Agreement under any Foreign Equivalent set forth on Schedule II.A.1,
provided, however, that nothing herein shall require Buyer to proffer or consent to
an order providing for (x) the sale or other disposition, or the holding separate, of any material
amount of particular assets, categories of assets or lines or business of the Company or its
Subsidiaries, or of Buyer or any of its Affiliates or (y) any material limits on the freedom of
action with respect to, or its ability to retain, any particular assets, categories of assets or
lines of business, of the Company or its Subsidiaries or of Buyer or any of its Affiliates. The
entry by any governmental authority in any action of an order permitting the consummation of the
transactions contemplated hereby but requiring any of the above identified actions which would have
a material adverse effect on the business or assets of Buyer and its Subsidiaries post-Closing
(including the business and assets of the Company and its Subsidiaries) shall be deemed a failure
to satisfy the conditions specified in II.

     D. Conditions.

     Unless a different or higher standard is expressly required by this Agreement, each of
Buyer and the Company shall use commercially reasonable efforts to cause the conditions set forth
in II to be satisfied and to consummate the transactions contemplated herein. 

     E. Contact with Customers and Suppliers.

      Prior to the Closing, none of Buyer or the Buyer’s Representatives shall contact or
communicate with the customers and suppliers of the Company or its Subsidiaries in connection with
the transactions contemplated hereby without the prior written consent of the Seller
Representative; provided, however, that the foregoing shall in no way limit Buyer’s
ability to issue press releases and make public statements and communications as contemplated
pursuant to Section 13.01 of this Agreement. Prior to the Closing, none of Buyer or
Buyer’s Representatives shall contact or communicate with the employees of the Company or its
Subsidiaries without the prior written consent of the Company’s Chief Executive Officer.

     F. Employee Benefits.

     1. For the period beginning on the Closing Date through December 31, 2011, Buyer
and its Affiliates shall provide (or cause the Company or its Subsidiaries to provide) each
employee of the Company or its Subsidiaries as of the Closing Date (each a “Company
Employee”) with (i) a base salary or regular hourly wage, whichever is applicable, and cash
bonus opportunity that is not less than the base salary or regular hourly wage and cash bonus
opportunity provided to such employee immediately prior to the Closing, and (ii) employee benefits
(excluding equity-based compensation) that are no less favorable in the aggregate than those
provided to such employee immediately prior to the Closing. Notwithstanding the foregoing, nothing
in this Agreement shall restrict the ability of the Company or its Subsidiaries from terminating
the employment of a Company Employee after the Closing in accordance with applicable law.

     2. For purposes of eligibility to participate and vesting under Buyer Plans, as
hereafter defined, each Company Employee shall be credited with his or her period of service with
the Company and its Subsidiaries, as applicable, before the Closing Date, to the same extent as
such Company Employee was entitled, before the Closing Date, to credit for such service under any
similar Employee Benefit Plan or Foreign Plan, except to the extent that such credit would result
in a duplication of benefits and except for purposes of benefit accrual under any defined benefit
plan not maintained or contributed to by the Company or any of its Subsidiaries prior to the
Closing. For purposes of this Agreement, the term “Buyer Plans” means the employee benefit
and compensation plans and programs maintained by Buyer and its Affiliates after the Closing Date
for the benefit of Company Employees, but specifically excluding each Employee Benefit Plan and
Foreign Plan. Without limiting the generality of the foregoing, except to the extent otherwise
required by applicable Legal Requirements: (i) each Company Employee who shall otherwise become
eligible to participate in any Buyer Plan under the terms and conditions of such Buyer Plan shall
become eligible to participate in such Buyer Plan immediately and without any waiting time or, if
any waiting time applied to such employee under the comparable Employee Benefit Plan or Foreign
Plan in which such employee participated immediately before the Closing (such plans, collectively,
the “Existing Plans”), such waiting time shall apply; and (ii) for purposes of each Buyer
Plan providing medical, dental, pharmaceutical or vision benefits to any Company Employee, Buyer
and its Affiliates shall cause (or cause the Company and its Subsidiaries to cause) (x) all
pre-existing condition exclusions and actively-at-work requirements of such Buyer Plan to be waived
for such Company Employee and his or her covered dependents (except to the extent that such
exclusions or requirements applied under the Existing Plans), and (y) any eligible expenses
incurred by such Company Employee and his or her covered dependents during the portion of the plan
year of the Existing Plan ending on the date such Company Employee’s participation in the
corresponding Buyer Plan begins to be taken into account under such Buyer Plan for purposes of
satisfying all deductible, co-payments and maximum out-of-pocket requirements applicable to such
Company Employee and his or her covered dependents for the applicable plan year as if such amounts
had been paid in accordance with such Buyer Plan;

22

 

 provided that such expenses shall not be taken
into account to the extent such recognition would result in a duplication of benefits.

     3. No Person (including any Company Employee, any Employee Benefit Plan, Foreign
Plan or any trustee or beneficiary thereof) shall (i) have any rights under this Agreement as a
third-party beneficiary or (ii) have any express or implied rights or remedies of any nature under
or by reason of this Section 5.03, and no provision in this Agreement shall constitute an amendment
of any Employee Benefit Plan or Foreign Plan.

     4. The parties hereto acknowledge that prior to the Closing, the Company shall
make a payment to each Company Employee who participates in the Company’s 2011 annual performance
bonus and sales program in an amount equal to the pro rata portion (calculated based on the number
of days from January 1, 2011 through and including the Closing Date divided by 365) of such Company
Employee’s 2011 annual performance bonus and sales program performance or, as applicable, sales
bonus, based on one hundred percent (100%) achievement of the performance objectives under the
Company’s 2011 annual performance bonus and sales program, for which such Company Employee would
have been eligible and had such Company Employee remained employed by the Company or its
Subsidiaries, as applicable, through December 31, 2011 and such performance, or, as applicable,
sales objectives been 
achieved. For the avoidance of doubt, the payments made pursuant to this Section
VII.F.4 do not include or reflect any amounts payable to Company Employees as part of the
Transaction Payment Amount.

     5. Subject to applicable Legal Requirements, the parties shall, and shall cause
their respective Affiliates to, mutually cooperate in undertaking all reasonably necessary or
legally required provision of information to, or consultations, discussions or negotiations with,
any union, works council, labor organization or other employee representative group regarding the
transactions contemplated by this Agreement.

     G. Payment of Dividend. To the extent, and only to the extent, that (a) following the
Closing, the Company receives any amounts in cash in the form of dividends, repatriations, returns
of capital, recapitalization proceeds or other distributions (collectively,
“Distributions”) from any of its Subsidiaries and (b) prior to the Closing, the payment of
such Distribution (i) was authorized by such Subsidiary and (ii) if required by the laws of the
jurisdiction in which such Subsidiary is organized, received approval from, or otherwise was
submitted for approval to, the governmental authority in such jurisdiction which oversees or
otherwise regulates the payment of such Distributions, then the Company shall pay as promptly as
practicable (and in any event within 20 days) after receipt thereof by the Company, to the Seller
Representative on behalf of Sellers an amount equal to the amount of any Distribution (net of any
foreign withholding taxes or U.S. federal or state income taxes payable after the Closing by the
Company or any of its Subsidiaries with respect to such Distribution, taking into account on a with
and without basis any reduction in Tax liability (including, without limitation, foreign tax
credits) available to Buyer, any of its Subsidiaries, the Company or any of its Subsidiaries with
respect to such taxes payable) (a “Dividend Payment”) received by the Company.
Schedule VII.G, which shall be updated at and as of the Closing, sets forth a list of all
such Distributions and, to the extent known, the amount of the anticipated Dividend Payment with
respect thereto (and if not known, a good faith estimate thereof). The Seller Representative shall
pay to each Seller an amount equal to such Seller’s Percentage Share of any Dividend Payment (less
any costs incurred by the Seller Representative in making such payments) by wire transfer of
immediately available funds.

     H. Confidentiality. Sellers have had access to, and have gained knowledge with respect
to the Business, including without limitation trade secrets, financial results and information,
processes and techniques, technical production and cost data, methods of doing business and
information concerning customers and suppliers, and other valuable and confidential information
relating to the business of the Company and its Subsidiaries (the “Confidential Information”).
Sellers acknowledge that unauthorized disclosure or misuse of the Confidential Information, whether
before or after the Closing, will cause irreparable damage to the Company, the Subsidiaries of the
Company and Buyer subsequent to the Closing. The parties also agree that covenants by Sellers not
to make unauthorized disclosures of the Confidential Information are essential to the growth and
stability of the business of the Company, the Subsidiaries of the Company and Buyer. Each Seller
severally agrees that he or she will not use or disclose any Confidential Information obtained in
the course of his, her or its, as the case may be, past connection with the business of the Company
and its Subsidiaries, other than (a) information generally available to the public through sources
other than Sellers, (b) information acquired after the Closing on a non-confidential basis from a
third party source that is not prohibited from disclosing such information to such Person, (c)
information independently developed by such Seller without the use of or reference to any
Confidential Information, (d) in connection with the performance of obligations, if any, as an
employee of the Corporation or Subsidiary of the Company, (e) to defend or participate in the
defense of actions as to which the indemnification provisions of Section 9.02(a), or in
connection with Tax reporting and related Tax matters associated with the Company or any Subsidiary
of the Company, or (f) as required by law or order of a court of competent jurisdiction.
Notwithstanding the foregoing, Sellers and their respective Affiliates, shall not be restricted
from disclosing to investors or prospective investors, financing sources, accountants, consultants
and others the total consideration paid by Buyer in connection with this Agreement, the identity of
Buyer, and information relating to the Sellers’ return on investment or any other information
already disclosed to the public.

     I. Use of Corporate Name or Trade Name. After the Closing, Sellers acknowledge that no
rights in the name “CVI,” “CVI Melles Griot” or any trade name included within the Intellectual
Property, or any derivative or variation thereof or any name similar thereto will be retained by
Sellers or their respective Affiliates. Sellers may use or refer to the foregoing names (i) in
connection with the performance of their post-closing employment obligations with the Company or
any Subsidiary of the Company, (ii) to identify the fact that they had been, as applicable, owners,
employees and managers of the Company or any Subsidiary of the Company, (iii) as required by law or
any governmental authority or regulatory agency, or in any filings required thereby, whether public
or private in nature, (iv) in public announcements permitted under this Agreement, or (v) in
connection with the disclosure, subject to Section VII.H, to investors or prospective
investors, financing sources, accountants, consultants and others of information relating to the
total consideration paid by Buyer in connection with this Agreement, the identity of Buyer, the
Sellers’ return on investment and any other information already disclosed to the public.

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VIII.

TERMINATION

     A. Termination. This Agreement may be terminated at any time prior to the Closing:

     1. by the mutual written consent of Buyer and the Seller Representative; 

     2. by Buyer, if there has been a material violation or breach by the Company or
Sellers of any covenant, representation or warranty contained in this Agreement which would prevent
the satisfaction of any condition to the obligations of Buyer at the Closing and such violation or
breach has not been waived by Buyer or cured by the Company or Sellers within 20 days after written
notice thereof from Buyer;

     3. by the Seller Representative, if there has been a material violation or breach
by Buyer of any covenant, representation or warranty contained in this Agreement which would
prevent the satisfaction of any condition to the obligations of Sellers at the Closing and such
violation or breach has not been waived by the Seller Representative or cured by Buyer within 20
days after written notice thereof by the Seller Representative (provided that the failure of Buyer
to deliver the consideration pursuant to Section I.D at the Closing as required hereunder
shall not be subject to cure hereunder unless otherwise agreed to in writing by the Seller
Representative); or

     4. by either Buyer or the Seller Representative if the Closing has not occurred
on or before August 9, 2011; provided, however, that such date may, from time to
time be extended by the Seller Representative (by written notice thereof to Buyer) up to and
including September 8, 2011, in the event that all conditions to Closing other than those set forth
in Section II.A.1 (the “Regulatory Conditions”) have been or are capable of being
satisfied at the time of such extension and the Regulatory Conditions have been or are reasonably
capable of being satisfied on or prior to September 8, 2011; provided further that
neither Buyer nor the Seller Representative shall be entitled to terminate this Agreement pursuant
to this Section VIII.A.4 if such Person’s fraud or willful breach of this Agreement has
prevented the consummation of the transactions contemplated hereby.

The party desiring to terminate this Agreement pursuant to clauses (b), (c) or (d) of this Section VIII.A shall give
written notice of such termination to the other parties hereto.

     B. Effect of Termination. In the event of termination of this Agreement by either Buyer or
the Seller Representative as provided above, the provisions of this Agreement shall immediately
become void and of no further force and effect (other than this Section VIII.B, Section
VII.E, and XIII hereof and the Confidentiality Agreement which shall survive the
termination of this Agreement), and there shall be no liability on the part of any of Buyer, the
Company, or Sellers to one another, except resulting from fraud or willful breaches of this
Agreement prior to the time of such termination.

IX.

INDEMNIFICATION

     A. Survival of Representations and Warranties. The representations, warranties,
covenants and agreements set forth in this Agreement and in any certificates delivered at the
Closing in connection with this Agreement shall survive the Closing until the first anniversary of
the Closing Date (the “Survival Period”) and shall thereafter be of no further force or
effect; provided, however, that (i) the representations and warranties contained in
Section III.C (Ownership of the Units) and clause (ii) of Section IV.D.1
(Capitalization and Related Matters) shall survive indefinitely, (ii)(A) the representations and
warranties contained in Section IV.H (Taxes) and (B) the indemnification obligations
contained in Section IX.B.1(iii), in each case, shall survive until the fourth anniversary
of the Closing Date and (iii) the indemnification obligations contained in Section
IX.B.1(v) shall survive the Closing until the first anniversary of the Closing Date. Subject
to the foregoing, any covenants or agreements of any party which are to be performed or observed on
or following the Closing shall survive the Closing until fully performed or observed in accordance
with their terms. Except as expressly provided in the immediately preceding sentence and the
proviso in the first sentence of this Section IX.A, no claim for indemnification hereunder
may be made after the expiration of the Survival Period.

     B. Indemnification for the Benefit of Buyer.

     1. Subject to provisions of this IX, from and after the Closing, Buyer, its
Subsidiaries, the Company and its Subsidiaries and each of their respective officers, directors,
partners, members, employees, agents, representatives, successors and permitted assigns
(collectively, the “Buyer Indemnified Parties”) shall be indemnified by Sellers to the
extent provided in this IX against any Losses which the Buyer Indemnified Parties suffer as
a result of (i) any breach by any Seller of any representation and warranty of such Seller
contained in III, (ii) any breach by the Company of any representation and warranty of the
Company contained in IV or any certificate delivered by or on behalf of the Company
hereunder at or prior to the Closing; provided that Losses attributable to Taxes described in
Section IX.B.1(iii) shall be indemnified pursuant to that provision only, (iii) any Taxes
of the Company and its Subsidiaries for (A) any taxable period ending on or before the Closing Date
(a “Pre-Closing Tax Period”), (B) any taxable period beginning before or on and ending
after the Closing Date (a “Straddle Period”) to the extent allocable pursuant to
Section XI.C.2 to the period ending on or before the Closing Date and (C) the sale by
Sellers of the Units, but in the case of 

24

 

 each of clauses (A), (B) and (C) only to the extent that
such Taxes exceed the Net Tax Reserve Amount, (iv) any non-fulfillment or breach of any covenant or
agreement, set forth in this Agreement to be performed or complied with by a Seller, or (v) the
matters set forth on Schedule IX.B.1(v) (the “Specific Indemnification
Items”).

     2. Notwithstanding anything to the contrary contained herein, except in the case
of Losses attributable to (i) Taxes described in Section IX.B.1(iii), (ii) breaches of the
representations and warranties contained in Section III.C (Ownership of the Units), (iii)
breaches of the representations and warranties contained in subsection (a) of Section IV.D
(Capitalization and Related Matters), or (iv) the non-fulfillment or breach of any covenant or,

agreement set forth in this Agreement to be fulfilled by a Seller (collectively, the
“Special Losses”), the Buyer Indemnified Parties’ sole and exclusive recourse against the
Sellers under this Section B shall be from the Escrow Fund and Sellers shall be jointly and
severally liable for the payment out of the Escrow Fund for any such Losses suffered by any Buyer
Indemnified Party. For any Special Losses suffered by a Buyer Indemnified Party in excess of the
product of (x) the remaining balance in the Escrow Fund and (y) such Seller’s proportionate
ownership of the Company as set forth on Schedule 4.04 (in the case of clause (ii) above)
or after the expiration of the Escrow Fund, Sellers shall be severally, but not jointly, liable for
the payment of (A) such Seller’s Percentage Share of any such Special Losses (in the case of
clauses (i), (iii) and (iv) above) or (B) the amount of such Special Losses (in the event of clause
(ii) above). Notwithstanding the foregoing, however, the representations and warranties contained
in III that relate specifically and solely to a particular Seller are the obligations of
that particular Seller only and the other Sellers shall not be responsible therefore. The
particular Seller making any such representation or warranty contained in this Agreement shall be
solely responsible for any Losses the Buyer Indemnified Parties suffer as a result of any breach of
any such representations and warranties by such Seller, and the full amount of any such Losses
shall, to the extent paid to Buyer from the Escrow Fund, be promptly paid by such Seller directly
to the Seller Representative, which shall thereafter pay such amount to each other Seller, by wire
transfer of immediately available funds to an account designated by such other Seller, in
accordance with such other Seller’s Percentage Share (less such other Seller’s Percentage Share of
any costs incurred by the Seller Representative in making such payments). In no event, except in
the case of Special Losses, shall the aggregate liability of any Seller for all Losses claimed by
the Buyer Indemnified Parties against such Seller under Sections IX.B.1 and 2
exceed such Seller’s Percentage Share of the Escrow Fund.

     3. Notwithstanding any other provision in this Agreement to the contrary, Sellers
shall not have any liability under Sections IX.B.1(i) and (ii) above, unless the
aggregate of all Losses relating thereto for which Sellers would be liable, but for this Section,
exceeds on a cumulative basis $2,000,000 (the “Deductible”) and then only to the extent
such Losses exceed the Deductible; provided that the Deductible shall not apply to Losses
based upon, attributable to or resulting from (i) breaches of the representations and warranties
contained in Section III.C (Ownership of the Units), subsection (b) of Section IV.B
(Subsidiaries), subsections (a)(ii) and (c) of Section IV.D (Capitalization and Related
Matters) and Section IV.H (Tax Matters) and (ii) the Specific Indemnification Items, each
of which shall be indemnifiable by the Sellers from the first dollar of such Losses;
provided, further, that Sellers’ aggregate liability under Section IX.B.1
and 2 shall in no event exceed $20,000,000 (the “Cap”), except in the case of
Losses attributable to breaches of the representations and warranties contained in (A) Section
III.C, which liability, for each Seller, shall not exceed an amount equal to the aggregate
proceeds received by such Seller in connection with the consummation of the transactions
contemplated hereby or (B) clause (ii) of Section IV.D.1 (Capitalization and Related
Matters), which liability for each Seller shall equal such Seller’s Percentage Share of such Losses
up to, but in no event exceeding, an amount equal to the aggregate proceeds received by such Seller
in connection with the consummation of the transactions contemplated hereby.

     4. Notwithstanding any other provision in this Agreement to the contrary, the
Sellers shall not be liable to, or indemnify, the Buyer Indemnified Parties for any Losses (i) to
the extent and only to the extent that such Losses result from or arise out of actions taken by the
Buyer Indemnified Parties or the Company, its Subsidiaries or any of their respective Affiliates
from and after the Closing Date, (ii) to the extent that such Losses result from or arise out of
any Assumed Liabilities, (iii) to the extent that such Losses result from or arise out of any
reduction in, or limitation on the use of, any net operating loss carryover or credit carryover or
similar Tax attribute of the Company or any of its Subsidiaries attributable to a Pre-Closing
Period, except to the extent such reduction or limitation results in a Tax liability which is
subject to indemnification pursuant to Section IX.B.1(iii), or (iv) with respect to any
amount that was taken into account in the final determination of Net Working Capital, Closing Date
Indebtedness, Company Transaction Expenses or the Transaction Payment Amount pursuant to
Section I.E hereof. This Section IX.B constitutes the Buyer Indemnified Parties’
sole and exclusive remedy for any and all Losses or other claims relating to or arising from this
Agreement and the transactions contemplated hereby (other than in the case of fraud and the
adjustment provisions of I).

     5. Nothing contained herein shall modify any obligations under common law of the
Buyer Indemnified Parties to mitigate Losses upon and after becoming aware of any event which would
reasonably be expected to give rise to Losses subject to indemnification hereunder.

     6. The Buyer Indemnified Parties shall not be entitled to recover any Losses
relating to any matter arising under one provision of this Agreement to the extent that the Buyer
Indemnified Parties had already recovered Losses with respect to such matter pursuant to other
provisions of this Agreement.

     C. Indemnification for the Benefit of the Sellers.

25

 

     1. From and after the Closing Date, Buyer and the Company shall jointly and
severally indemnify Sellers and their respective officers, directors, partners, members, employees,
agents, representatives (excluding the Seller Representative, solely in its capacity as the Seller
Representative and not as a Seller), successors and permitted assigns (collectively, the
“Seller Indemnified Parties”) against any Losses which the Seller Indemnified Parties
suffer as a result of (i) any breach of any representation or warranty of Buyer under this
Agreement or any certificate delivered by or on behalf of Buyer hereunder, or (ii) any non-
fulfillment or breach of any covenant or agreement set forth in this Agreement to be
performed by Buyer and/or, from and after the Closing, the Company or any of its Subsidiaries.

     2. Notwithstanding any other provision in this Agreement to the contrary, the
aggregate liability of Buyer and the Company under Section IX.C.1 shall in no event exceed
the Cap.

     3. This Section IX.C constitutes the Seller Indemnified Parties’ sole and
exclusive remedy for any and all Losses or other claims relating to or arising from this Agreement
and the transactions contemplated hereby (other than in the case of fraud and the adjustment
provisions of I).

     4. Nothing contained herein shall modify any obligations under common law of the
Seller Indemnified Parties to mitigate Losses upon and after becoming aware of any event which
would reasonably be expected to give rise to Losses subject to indemnification hereunder.

     5. The Seller Indemnified Parties shall not be entitled to recover any Losses
relating to any matter arising under one provision of this Agreement to the extent that the Seller
Indemnified Parties had already recovered Losses with respect to such matter pursuant to other
provisions of this Agreement.

     D. Special Rule for Fraud. Notwithstanding anything in this IX to the contrary,
in the event of any breach of a representation or warranty by any party hereto that constitutes
fraud, by or on behalf of any Seller or the Company (prior to Closing) in connection with the
consummation of the transactions contemplated by this Agreement, on the one hand, or Buyer, on the
other hand, then (a) the limitations set forth in Section IX.B.2, Section IX.B.3 or
Section IX.C.2 (as the case may be) shall not apply to any Loss that the Buyer Indemnified
Parties or the Seller Indemnified Parties, as the case may be, may suffer, sustain or become
subject to, as a result of, arising out of, relating to or in connection with any such breach;
provided that in no event shall the aggregate liability for Losses under this Section
IX.D for each Seller, exceed the aggregate proceeds received by such Seller in connection with
the consummation of the transactions contemplated hereby, and (b) none of such Losses shall count
towards the satisfaction of the Deductible.

     E. Manner of Payment. Any indemnification payment pursuant to this XI shall be
effected by wire transfer of immediately available funds from the applicable indemnifying party to
an account designated by each applicable indemnified party within 20 days after the determination
thereof. Any payments required to be made by Sellers in satisfaction of claims for indemnification
pursuant to Section IX.B.1 and B.2 shall be paid first from the Escrow Fund, to the
extent of the available funds in the Escrow Fund.

     F. Defense of Third-Party Claims.

     1. Any Person making a claim for indemnification under Section IX.B or
Section IX.C (an “Indemnitee”) shall notify the indemnifying party (an
“Indemnitor”) of the claim in writing promptly after receiving notice of any action,
lawsuit, proceeding, investigation, demand or other claim against the Indemnitee (if by a third
party), describing the claim, the amount thereof (if known and quantifiable) and the basis thereof
in reasonable detail (such written notice, an “Indemnification Notice”); provided
that the failure to so notify an Indemnitor shall not relieve the Indemnitor of its
obligations hereunder except to the extent and only to the extent that such failure shall have
caused the damages for which the Indemnitor is obligated to be greater than such damages would have
been had the Indemnitee given the Indemnitor prompt notice hereunder. 

     2. Any Indemnitor shall be entitled to participate in the defense of such action,
lawsuit, proceeding, investigation or other claim giving rise to an Indemnitee’s claim for
indemnification at such Indemnitor’s expense, or at its option assume the defense thereof by
appointing a reputable counsel reasonably acceptable to the Indemnitee to be the lead counsel in
connection with such defense. Notwithstanding the foregoing, the Indemnitor shall not have the
right to assume control of the defense of such claim, and shall pay the reasonable fees and
expenses of one counsel to all Indemnitees arising out of the same or similar set of circumstances
in connection with such defense, if such claim (i) involves a criminal allegation by a governmental
authority, (ii) involves a claim, which, if adversely determined, would be reasonably expected to
materially affect the ability of Buyer and the Company to operate the business of the Company and
its Subsidiaries in the ordinary course and consistent with past practices, (iii) could reasonably
be expected to result in a Loss (including the cost of defense) which exceeds one hundred
twenty-five percent (125%) of the excess of (x) the amount, if any, then remaining in the Escrow
Fund, over (y) the amount of Losses (including costs of defense) which could reasonably be expected
to be paid in satisfaction of any pending but unresolved claims for indemnification, (iv) involves,
in the opinion of counsel of the Indemnitee, a conflict of interest between the Indemnitor and the
Indemnitee, (v) in the written opinion of independent counsel, is not being vigorously defended by
the Indemnitor such claim, or (vi) involves any matter described in item 2 of Schedule
9.02(a)(v) (clauses (i) through (vi), the “Exception Claims”). Notwithstanding the
foregoing or anything herein to the contrary, (1) all costs of any such defense or any settlement
by the Seller Representative, including reasonable attorneys’ fees, accountants’ fees and any other
reasonable fees and expenses related to any such defense, shall be indemnifiable 

26

 

Losses and shall
be paid from the Escrow Fund and (2) the Indemnitor shall not assume control of the defense of any
third-party claim unless the Indemnitor shall agree in writing to indemnify the Indemnitee for

all Losses attributable to such third-party claim subject to the terms of this Agreement,
including the limitations set forth in Section IX.B.2, Section IX.B.3 and
Section C.2 (as the case may be).

     3. If (i) the Indemnitor shall not assume the defense of any such action,
lawsuit, proceeding, investigation or other claim, (ii) such claim is an Exception Claim or (iii)
Indemnitor fails to agree to indemnify the Indemnitor for all Losses attributed to such third-party
claim (subject to the terms of this Agreement, including the limitations set forth in Section
IX.B.2, Section IX.B.3 and Section C.2 (as the case may be)), in each case, the
Indemnitee may defend against such matter as it deems appropriate at the expense of the Indemnitor;
provided that the Indemnitor shall be entitled to participate in the defense of
such claim and to employ counsel of its choice for such purpose; provided, however,
that the fees and expenses of such separate counsel shall be borne by the Indemnitor and shall not
be recoverable from such Indemnitee or the Escrow Fund under this IX; provided
further that the Indemnitee may not settle any such matter, other than an Exception Claim
that does not solely involve monetary damages, without the written consent of the Indemnitor (which
consent shall not be unreasonably withheld or delayed) if the Indemnitee is seeking or will seek
indemnification hereunder with respect to such matter. 

     4. If the Indemnitor assumes the defense of any such action, lawsuit, proceeding,
investigation or other claim, the Indemnitee shall be entitled to participate in the defense of
such claim and to employ counsel of its choice for such purpose; provided, however,
that the fees and expenses of such separate counsel shall be borne by the Indemnitee and shall not
be recoverable from such Indemnitor under this IX. If the Indemnitor assumes the defense
of any such claim, the Indemnitor shall not be liable for any amount required to be paid by the
Indemnitee that exceeds, where the Indemnitee has unreasonably withheld or delayed consent in
connection with the proposed compromise or settlement of a third-party claim where the remedy is
solely monetary damages and no equitable remedy and where the settlement includes as a term thereof
a full release of the Indemnitee, the amount for which that third-party claim could have been
settled pursuant to that proposed compromise or settlement. If the Indemnitor shall control the
defense of any such claim, the Indemnitor shall be entitled to settle such claims; provided
that the Indemnitor shall obtain the prior written consent of the Indemnitee (which consent
shall not be unreasonably withheld) before entering into any settlement of a claim or ceasing to
defend such claim. In all cases, the Indemnitee shall provide its reasonable cooperation with the
Indemnitor in defense of claims or litigation, including by making employees, information and
documentation reasonably available. To the extent of any conflict between the provisions of this
Section F and Section XI.C.7, the provisions of Section XI.C.7 shall
govern.

     G. Determination of Loss Amount. The amount of any Loss subject to indemnification
under Section IX.B or Section IX.C shall be calculated net of (i) solely in the
case of Losses attributable to any foreign Subsidiary of the Company, any Tax Benefit actually
realized by the Indemnitee or any of its Affiliates as a result of such Loss, (ii) any reserves set
forth in the Closing Balance Sheet and/or the Closing Statement and included in the Net Working
Capital Amount relating specifically to the matter with respect to which such Loss relates and
(iii) any insurance proceeds (net of retrospective premium payments or prospective premium
increases) or other amounts under indemnification agreements actually received by the Indemnitee on
account of such Loss. If, after an indemnification payment is made to the Indemnitee in respect of
a Loss attributable to any foreign Subsidiary of the Company, the Indemnitee or any of its
Affiliates receives a Tax Benefit on account of such Loss that was not fully deducted from such
indemnification payment, Buyer or the indemnified Seller (as applicable) shall, or shall cause the
recipient of such undeducted Tax Benefit to, promptly pay to the Person or Persons that made such
indemnification payment the amount of such undeducted Tax Benefit at such time or times as and to
the extent that such undeducted Tax Benefit is actually realized by such recipient. For purposes
of this Section IX.G, “Tax Benefit” shall mean any refund of Taxes to be paid or
reduction in the amount of Taxes which otherwise would be paid by the Indemnitee or any of its
Affiliates, in each case computed at the highest marginal tax rates applicable to the recipient of
such benefit. Buyer or the indemnified Seller (as applicable) shall use commercially reasonable
efforts to seek full recovery under all insurance policies covering any Loss to the same extent as
they would if such Loss were not subject to indemnification hereunder. In the event that an
insurance or other recovery is made by any Indemnitee with respect to any Loss for which any such
Person has received indemnity payments hereunder, then a refund equal to the aggregate amount of
the actual recovery shall be made promptly to the Person or Persons that provided such indemnity
payments to such Indemnitee. The Indemnitors shall be subrogated to all rights of the Indemnitees
in respect of any Losses indemnified by the Indemnitors.

     H. Termination of Indemnification. The obligations to indemnify and hold harmless a
party hereto in respect of a breach of representation, warranty, covenant or agreement shall
terminate when the applicable representation or warranty or covenant or agreement terminates
pursuant to Section IX.A; provided, however, that such obligations to
indemnify and hold harmless shall not terminate with respect to any item as to which the party to
be indemnified shall have, prior to the expiration of the applicable survival period, previously
made a claim by delivering a written notice (stating in reasonable detail the nature of, and
factual and legal basis for, any such claim for indemnification, and the provisions of this
Agreement upon which such claim for indemnification is made) to the indemnifying party.

     I. Limitation on Recourse. No claim shall be brought or maintained by Buyer, the
Company or any of their respective Subsidiaries or their respective successors or permitted assigns
against any officer, director or employee (present or former) of any Seller in its capacity as such
or any Affiliate of any Seller unless a party to this Agreement as a Seller, and no recourse shall
be brought or granted against any of them, by virtue of or based upon any alleged misrepresentation
or inaccuracy in or breach of any of the representations, warranties or covenants of any party
hereto set forth or contained in this Agreement or any exhibit or schedule hereto or any
certificate delivered hereunder.

     J. Characterization of Payments. For Tax purposes, the parties agree to treat all
payments made under this IX as adjustments to the total consideration payable by Buyer for
the Units. All such payments relating to foreign Subsidiaries of the
Company shall be treated as
adjustments to the consideration allocable to such foreign Subsidiaries, and all such payments
relating to the U.S. operations of the

27

 

Company shall be treated as an adjustment to the
consideration allocable to the assets directly held within the Company (and not within any
Subsidiary of the Company).

X.

SELLER REPRESENTATIVE

     A. Designation. Each of the Sellers does hereby designate Norwest Equity Partners, VII,
LP as the “Seller Representative” to serve as the representative of the Sellers with
respect to the matters expressly set forth in this Agreement to be performed by the Seller
Representative. Should the Seller Representative resign or be unable to serve, the Seller
Representative shall appoint a single substitute agent to take on the responsibility of the Seller
Representative hereunder, whose appointment shall be effective on the date of the Seller
Representative’s resignation or incapacity.

     B. Authority. Each of the Sellers, by the execution of this Agreement, hereby
irrevocably appoints the Seller Representative as the agent, proxy and attorney in fact for such
Seller for all purposes of this Agreement, including the full power and authority on such Seller’s
behalf (i) to consummate the transactions contemplated herein and any post-Closing matters; (ii) to
pay the Sellers’ expenses incurred in connection with the negotiation and performance of this
Agreement (whether incurred before, on or after the date of this Agreement); (iii) to disburse any
funds received hereunder to such Seller and each other Seller; (iv) to endorse and deliver any
certificates or instruments representing the Units and execute such further instruments of
assignment as Buyer or the Company shall reasonably request; (v) to execute and deliver on behalf
of such Seller any amendment or waiver in connection with this Agreement and the other agreements
or documents contemplated hereby as the Seller Representative, in its sole discretion, may deem
necessary or desirable; (vi) to prepare, revise, supplement, update or amend any schedule, exhibit
or other document required to be delivered by or under this Agreement, including Schedule
I.B, (vii) to execute, deliver and perform its obligations under the Escrow Agreement (with
such modifications or changes therein as to which the Seller Representative, in its sole
discretion, shall have consented) and to agree to and enter into any such amendments or
modifications thereto as the Seller Representative, in its sole discretion, determines to be
desirable; (viii) to take all actions necessary to cause, as necessary, the Escrow Fund to be
replenished in accordance with Section I.F hereof; (ix) to take all other actions to be
taken by or on behalf of such Seller in connection herewith; (x) to do each and every act and
exercise any and all rights which such Seller(s) collectively are permitted or required to do or
exercise under this Agreement; and (xi) to make, execute, acknowledge and deliver the Escrow
Agreement and all such other agreements, guarantees, orders, receipts, endorsements, notices,
requests, instructions, certificates, stock powers, schedules, exhibits, letters and other
writings, and, in general, to do any and all things and to take any and all action that the Seller
Representative, in its sole and absolute discretion, may consider necessary or proper or convenient
in connection with or to carry out the transactions contemplated by this Agreement, the Escrow
Agreement and all other agreements and documents referred to herein or therein or executed in
connection herewith and therewith, including, retaining counsel, accountants and other experts,
incurring fees and expenses, asserting or pursuing any claim, action, proceeding or investigation
(a “Claim”) against Buyer, the Company and/or any Seller, defending any Claims by the Buyer
Indemnified Parties or third-party claims pursuant to IX hereof, consenting to,
compromising or settling any such Claims, conducting negotiations with Buyer, the Company and their
respective representatives regarding such Claims, it being understood that the Seller
Representative shall not have any obligation to take any such actions, and shall not have any
liability for any failure to take any such actions. Each of the Sellers agrees that such agency
and proxy are coupled with an interest, are therefore irrevocable without the consent of the Seller
Representative and shall survive the death, incapacity, bankruptcy, dissolution or liquidation of
any Seller. All decisions and actions by the Seller Representative (to the extent authorized by
this Agreement) shall be binding upon all Sellers, and no Seller shall have the right to object,
dissent, protest or otherwise contest the same; provided, however, that the Seller
Representative shall not take any such action where (x) any single Seller would be held solely
liable for a Loss (without such Seller’s consent) or (y) such action materially and adversely
affects the substantive rights or obligations of one Seller, or group of the Sellers, without a
similar proportionate effect upon the substantive rights or obligations of all Sellers, unless each
such disproportionately affected Seller consents in writing thereto.

     C. Authority; Indemnification. Each Seller agrees that Buyer and the Company shall be
entitled to rely on any action taken or omission to act by the Seller Representative, on behalf of
such Seller, pursuant to Section X.B above (an “Authorized Action”), and that each
Authorized Action shall be binding on each Seller as fully as if such Seller had taken such
Authorized Action. In no event shall Buyer or the Company, any of their Affiliates, have any
liability to any Seller for any action taken or omission to act by the Seller Representative.
Buyer agrees, for itself and the Company, that the Seller Representative, in its capacity as the
Seller Representative, shall have no liability to Buyer or the Company for any Authorized Action,
to the extent that such Authorized Action was taken or omitted in good faith and not in a manner
constituting fraud or willful misconduct. Each Seller hereby severally, for itself only and not
jointly, agrees to indemnify and hold harmless the Seller Representative against all expenses
(including reasonable attorneys’ fees), judgments, fines and amounts paid in settlement actually
and reasonably incurred by the Seller Representative in connection with any action, suit or
proceeding to which the Seller Representative is made a party by reason of the fact it is or was
acting as the Seller Representative pursuant to the terms of this Agreement and any expenses
incurred by the Seller Representative in connection with the performance of its duties hereunder.

     D. Seller Representative Holdback. The Seller Representative shall not be entitled to
any fee, commission or other compensation for the performance of its services hereunder, but shall
be entitled to the payment of all expenses incurred as the Seller Representative (it being
understood that in no event shall Buyer, the Company or any of their Affiliates be liable for any
such payment and, except as set forth below, the Escrow Fund shall not be used to make any such
payments). In connection with the foregoing, on or prior to the Closing Date, the Company shall
deliver $4,000,000 (the “Seller Representative Holdback”) to the Seller Representative to
be used by the Seller Representative to (a) pay any expenses incurred by the Seller Representative
in its capacity as the Seller Representative, including, but not limited to, any attorneys’,
accountants’ and other experts’ fees and (b) to replenish the Escrow Fund, as applicable, from the
Seller Representative Holdback in accordance with Section I.F. Immediately following the
first to occur of (x) the payment of the Final Adjustment Amount by the Escrow Agent and, as
applicable, the Replenishment Amount, if any, by the Seller Representative, or (y) the final
determination that the Final Adjustment Amount is equal to zero, the Seller Representative will
distribute to the Sellers their applicable pro rata portion (based on their Percentage Share of the
Seller Representative Holdback) of the amount by which the unused amounts of the Seller
Representative Holdback

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exceed the Holdback Floor, without any interest (the “Initial Holdback
Distribution”). Following the Initial Holdback Distribution, at such time as the Seller
Representative determines, in its sole discretion, that the Seller Representative will not incur
any additional expenses in its capacity as representative, then the Seller Representative will
distribute to the Sellers their applicable pro rata portion (based on their Percentage Share of the
Seller Representative Holdback) of the remaining unused amounts of the
Seller Representative Holdback, if any, without interest. In connection with defending any
third-party claims pursuant to Section IX.F, the Seller Representative shall be entitled to
be reimbursed from the Escrow Fund at any time upon written request from the Seller Representative
for costs and expenses (including, legal fees, disbursements and expenses) incurred by the Seller
Representative in its representative capacity. Buyer shall cause the Escrow Agent to pay any
amount requested by the Seller Representative as promptly as practicable, but in no event more than
five business days after the Seller Representative request therefor, which request shall include
wire transfer instructions.

     E. Exculpation. The Seller Representative shall not have by reason of this Agreement a
fiduciary relationship in respect of any Seller, except in respect of amounts received on behalf of
such Seller. The Seller Representative shall not be liable to any Seller for any action taken or
omitted by it or any agent employed by it hereunder or under any other document entered into in
connection herewith, except that the Seller Representative shall not be relieved of any liability
imposed by law for willful misconduct. The Seller Representative shall not be liable to Sellers
for any apportionment or distribution of payments made by the Seller Representative in good faith,
and if any such apportionment or distribution is subsequently determined to have been made in error
the sole recourse of any Seller to whom payment was due, but not made, shall be to recover from
other Sellers any payment in excess of the amount to which they are determined to have been
entitled. The Seller Representative shall not be required to make any inquiry concerning either
the performance or observance of any of the terms, provisions or conditions of this Agreement.
Neither the Seller Representative nor any agent employed by it shall incur any liability to any
Seller by virtue of the failure or refusal of the Seller Representative for any reason to
consummate the transactions contemplated hereby or relating to the performance of its other duties
hereunder, except for actions or omissions constituting fraud or willful misconduct.

     F. Survival. All of the indemnities, immunities and powers granted to the Seller
Representative under this Agreement shall survive the Closing Date and/or any termination of this
Agreement and/or the Escrow Agreement.

XI.

ADDITIONAL COVENANTS AND AGREEMENTS

     A. Disclosure Generally. If and to the extent any information required to be furnished
in any schedule is contained in any other schedule with such specificity (whether or not specific
cross references are given) so that it is reasonably apparent on the face of such information that
such information is also applicable to one or more other parts of the Agreement or any other
schedule, such information shall be deemed to be included in all schedules in which such
information is required to be included. The inclusion of any information in any schedule shall not
be deemed to be an admission or acknowledgment by the Company, in and of itself, that such
information is material to or outside the ordinary course of the businesses of the Company and its
Subsidiaries.

     B. Acknowledgments by Buyer. 

     1. THE REPRESENTATIONS AND WARRANTIES BY THE COMPANY AND SELLERS SET FORTH IN
THIS AGREEMENT, INCLUDING THE DISCLOSURE SCHEDULES, CONSTITUTE THE SOLE AND EXCLUSIVE
REPRESENTATIONS AND WARRANTIES OF THE COMPANY AND SELLERS TO BUYER IN CONNECTION WITH THE
TRANSACTIONS CONTEMPLATED HEREBY, AND BUYER UNDERSTANDS, ACKNOWLEDGES AND AGREES THAT ALL OTHER
REPRESENTATIONS AND WARRANTIES OF ANY KIND OR NATURE EXPRESS OR IMPLIED (INCLUDING, BUT NOT LIMITED
TO, ANY RELATING TO THE FUTURE OR HISTORICAL FINANCIAL CONDITION OR PROJECTIONS, RESULTS OF
OPERATIONS, ASSETS OR LIABILITIES OF THE COMPANY) ARE SPECIFICALLY DISCLAIMED BY THE COMPANY AND
SELLERS. Except as otherwise set forth herein, the Company and the Subsidiaries and Sellers do not
make or provide, and Buyer hereby waives, any warranty or representation, express or implied, as to
the quality, merchantability, fitness for a particular purpose, conformity to samples, or condition
of the Company’s or any of the Subsidiaries’ assets or any part thereto. No claim shall be brought
or maintained by the Company, its Subsidiaries or Buyer or their respective successors or permitted
assigns against any officer, director or employee (present or former) of the Company, its
Subsidiaries, the Sellers, the Seller Representative, in their capacity as such, and no recourse
shall be brought or granted against any of them, by virtue of or based upon any alleged
misrepresentation or inaccuracy in, or breach of any of the representations, warranties or
covenants of the Company and/or the Sellers set forth or contained in, this Agreement or any
certificate delivered hereunder, except in the case of fraud and to the extent provided in
Section IX.B hereof.

     2. In connection with its investigation of the Company and the Subsidiaries,
Buyer has received from or on behalf of the Company, the Subsidiaries or Sellers certain
projections. Buyer acknowledges and agrees that there are uncertainties inherent in attempting to
make such estimates, projections and other forecasts and plans, that it is familiar with such
uncertainties, that it is taking full responsibility for making its own evaluation of the adequacy
and accuracy of all estimates, projections and other forecasts and plans so furnished to it
(including the reasonableness of the assumptions underlying such estimates, projections and
forecasts), and that, except in the case of fraud and to the extent provided in Section
IX.B hereof, it will not have any claim against the Company, its Subsidiaries, the Sellers, the
Seller Representative or any direct or indirect equity holder of the Sellers with respect thereto.
Accordingly, none of the Company, the Subsidiaries or the Sellers makes any representations or
warranties whatsoever with respect to such estimates, projections and other forecasts and plans
(including the reasonableness of the assumptions underlying such estimates, projections and
forecasts). Except in the case of fraud, Buyer agrees that none of the Sellers (other than as
otherwise set forth herein) nor any of their Affiliates will have or be subject to any liability to
Buyer, the Company or any other Person resulting from the distribution to Buyer, or

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Buyer’s use of,
any information regarding the Company or any of the Subsidiaries or their respective businesses,
including 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. 

     C. Tax Matters. The following provisions shall govern the allocation of responsibility
as between Buyer and Sellers for certain tax matters following the Closing Date:

     1. Responsibility for Filing Tax Returns.

          The Seller Representative shall prepare or cause to be prepared all Tax Returns of
the Company and its Subsidiaries for all Pre-Closing Tax Periods which are not filed or
otherwise due as of the Closing Date. At least 15 days prior to the date on which each such
Tax Return is filed, the Seller Representative shall submit such Tax Return to Buyer for its
review and comment, and the Seller Representative shall make such revisions to such Tax
Return as are reasonably requested by Buyer and received by Seller at least ten days prior
to the date on which such Tax Return is filed (but Seller Representative shall be under no
obligation to accept any comments that relate to positions taken on such Tax Return that are
prepared in accordance with applicable Legal Requirements and otherwise consistent with past
practice). At least five days before the date on which any such Tax Return is due, the
Seller Representative shall deliver such Tax Return to Buyer for filing. Buyer shall timely
file or cause to be timely filed such Tax Return and shall pay all Taxes reflected on such
Tax Return, subject to Buyer’s right to indemnification pursuant to Section
IX.B.1(iii) for the portion of such Taxes owing in excess of the Net Tax Reserve
Amount.

          Buyer shall prepare or cause to be prepared in accordance with the past practice of
the Company and its Subsidiaries (except to the extent otherwise required by applicable
Legal Requirements), and timely file or cause to be timely filed, all Tax Returns of the
Company and its Subsidiaries for all Straddle Periods. At least 15 days prior to the date
on which each such Tax Return is filed, Buyer shall submit such Tax Return to the Seller
Representative for its review and approval, which approval may not be unreasonably withheld;
provided, however, that such approval may be withheld if such Tax Return has
not been prepared in accordance with past practice (except to the extent otherwise required
by applicable Legal Requirements) and the filing of such Tax Return is reasonably expected
by the Seller Representative to adversely affect the Tax liability, the amount received
under this Agreement or the indemnification obligation, in each case, of any Seller. Buyer
shall pay all Taxes reflected on such Tax Returns, subject to Buyer’s right to
indemnification pursuant to Section IX.B.1(iii) for the portion of such Taxes owing
in excess of the Net Tax Reserve Amount.

     2. Straddle Periods. With respect to any Straddle Period, the portion of
any Tax that is allocable to the taxable period that is deemed to end on the Closing Date will be:
(i) in the case of real property Taxes, personal property Taxes and similar ad valorem Taxes,
deemed to be the amount of such Taxes for the entire Straddle Period multiplied by a fraction, the
numerator of which is the number of calendar days of such Straddle Period in the Pre-Closing Tax
Period and the denominator of which is the number of calendar days in the entire Straddle Period,
and (ii) in the case of all other Taxes, determined as though the taxable year of the Company
terminated at the close of business on the Closing Date.

     3. Tax Refunds. Any refunds that are received by Buyer (other than those
attributable to net operating losses carry backs from periods after the Closing), the Company or
any of its Subsidiaries that relate to Taxes for either the Pre-Closing Tax Period or any Straddle
Period (to the extent allocable pursuant to Section XI.C.2 to the period ending on or
before the Closing Date) shall be for the account of Sellers to the extent not already credited in
Sellers’ favor as part of the calculation of the Net Working Capital Amount, and Buyer shall pay
over to the Seller Representative any such refund within 15 days after receipt thereof, net of
reasonable expenses of collection and, where applicable, all Tax liability incurred in respect of
such refunds. For the avoidance of doubt, to the extent any refunds are received by the Buyer, the
Company or any of its Subsidiaries after the Closing in respect of foreign withholding Taxes or
U.S. federal or state income Taxes imposed on any dividends or other distributions received by the
Company from any of its Subsidiaries prior to the Closing or imposed on any Dividend Payments
described in Section VII.G (including, without limitation, any excess withheld amounts
refunded upon establishment of eligibility for reduced withholding rates under an applicable Tax
treaty), such refunds shall be paid over to the Seller Representative within 15 days after receipt
thereof. 

     4. Cooperation on Tax Matters. 

          Buyer, the Company and its Subsidiaries, Sellers and the Seller Representative
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 XI.C 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. The Company and its Subsidiaries, Sellers
and the Seller Representative agree (A) to retain all books and records with respect to Tax
matters pertinent to the

30

 

 Company 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 Sellers or the Seller Representative, any extensions
thereof) of the respective taxable periods, and to abide by all record retention agreements
entered into with any Tax authority, and (B) to give the other party at least 30 days 
written notice prior to transferring, destroying or discarding any such books and
records and, if the other party so requests, the Company and its Subsidiaries, or Sellers or
the Seller Representative, as the case may be, shall allow the other party to take
possession of such books and records.

          Buyer and the Seller Representative further agree, upon request, to provide the
other party with all information (in their respective possession) that either party may be
required to report pursuant to Code §6043A and all Treasury Regulations promulgated
thereunder.

     5. Tax-Sharing Agreements. All tax-sharing agreements or similar
agreements with respect to or involving the Company and its Subsidiaries shall be terminated as of
the Closing Date and, after the Closing Date, the Company and its Subsidiaries shall not be bound
thereby or have any liability thereunder.

     6. Transfer Taxes. The cost of any documentary, stamp, stock transfer,
or similar Tax imposed on the Company and its Subsidiaries or one or more Sellers as a result of
the transactions contemplated by this Agreement (collectively, “Transfer Taxes”), and any
penalties or interest with respect to such Transfer Taxes, shall be borne equally by Sellers (as
Company Transaction Expenses) and by Buyer. The Seller Representative agrees to cooperate with
Buyer and the Company in the filing of any Tax Returns with respect to Transfer Taxes, including
promptly supplying any information in its possession reasonably requested by Buyer and the Company
that is reasonably necessary to complete such Tax Returns and promptly remitting to Buyer any
invoices for such Transfer Taxes that are received by Sellers.

     7. Contest Provisions. The Seller Representative and Sellers, on the one
hand, and Buyer, the Company and its Subsidiaries, on the other hand, shall promptly notify each
other upon receipt by such party of written notice of any inquiries, claims, assessments, audits,
proceedings or similar events with respect to Taxes relating to a Pre-Closing Tax Period or to that
portion of a Straddle Period ending on the Closing Date (any such inquiry, claim assessment, audit,
proceeding or similar event, a “Tax Matter”). If Sellers have any continuing
indemnification obligations under Section IX.B.1(iii), or under Section IX.B.1(ii)
for breach of any representations or warranties in Section IV.H (Taxes), then the Seller
Representative shall have the right to control the conduct and resolution of such Tax Matter
(unless the amount of liability with respect to such Tax Matter could reasonably be expected to
exceed 125% of the excess of (i) the amount remaining under the Cap over (ii) the amount which
could reasonably be expected to be paid in satisfaction of any pending but unresolved claims for
indemnification, in which event Buyer shall have the right to control the conduct and resolution of
such Tax Matter; provided, however, that Buyer shall keep the Seller Representative
informed of all developments on a timely basis and Buyer shall not resolve such Tax Matter without
the Seller Representative’s written consent). Whenever the Seller Representative controls the
conduct and resolution of a Tax Matter, the Seller Representative shall keep Buyer informed of all
developments on a timely basis; provided, however, that if any of the issues raised
in such Tax Matter could reasonably be expected to have an adverse impact on Taxes of the Company
or its Subsidiaries for a taxable period beginning (or the portion of a Straddle Period beginning)
after the Closing Date, then the Seller Representative shall afford Buyer the opportunity to
control jointly the conduct and resolution of the portion of such Tax Matter which could have an
adverse impact on such Taxes in such period or portion thereof. If the Seller Representative has
the right to control the conduct and resolution of a Tax Matter but elects in writing not to do so
within 15 days of receiving notice of such Tax Matter, then Buyer shall have the right to control
the conduct and resolution of such Tax Matter; provided, however, that whenever
Buyer has the right to control the conduct and resolution of any Tax Matter pursuant to this
sentence, that Buyer shall keep the Seller Representative informed of all developments on a timely
basis and Buyer shall not resolve such Tax Matter in a manner that could reasonably be expected to
have an adverse impact on Sellers’ indemnification obligations under this Agreement without the
Seller Representative’s written consent. Each party shall bear its own costs for participating in
any Tax Matter.

     8. Tax Treatment of Transaction. Consistent with Situation 2 of Revenue
Ruling 99-6, 1999-1 C.B. 432, the parties hereto agree to treat, for U.S. federal income Tax
purposes, the transfer of interests by Sellers to Buyer as follows: (i) as to Sellers, as a
transfer of interests by Sellers to Buyer; (ii) as to Buyer, as if the Company had distributed in
liquidation of the Company to each Seller its respective pro rata share of the Company’s assets and
as if Buyer had purchased each Seller’s respective pro rata share of the assets received from the
Company. The parties hereto further agree that (A) the transfer of the interests shall result in a
termination of the partnership for purposes of Section 708 of the Code and (B) the taxable year of
the Company shall close as of the end of the day on the Closing Date. 

     9. Allocation. Buyer and Sellers hereby agree that the Purchase Price
(together with all amounts treated as consideration for U.S. federal income tax purposes) shall be
allocated among the assets acquired pursuant to the transactions contemplated by this Agreement in
accordance with Section 1060 of the Code and the Treasury Regulations promulgated thereunder (and
any similar provision of state, local or foreign law, as appropriate) and in accordance with the
methodology set forth on Exhibit C hereto (the “Allocation”). The Allocation shall
be delivered by Buyer to Seller Representative within 150 days after the Closing Date for Seller
Representative’s approval, which approval shall not be unreasonably withheld. Buyer and the Seller
Representative shall work in

31

 

 good faith to resolve any disputes relating to the Allocation. If
Buyer and the Seller Representative are unable to resolve any such dispute within 30 days of Seller
Representative’s receipt of the Allocation, such dispute shall be resolved promptly by the
Independent Auditor, the costs of which shall be borne equally by Buyer, on the one hand, and
Sellers, on the other hand. To the extent required by any applicable Legal Requirement, the 
Allocation shall be revised to reflect any adjustment of the total consideration payable
by Buyer pursuant to this Agreement. Buyer and Sellers shall prepare and file all Tax Returns and
other statements in a manner consistent with the Allocation and shall not make any inconsistent
statement or adjustment on any Tax Returns or otherwise during the course of an audit,
investigation or other dispute with a Tax authority; provided, however, that nothing contained
herein shall prevent Buyer or Sellers from settling any proposed deficiency or adjustment by any
Tax authority based upon or arising out of the Allocation, and neither Buyer nor Sellers shall be
required to litigate before any court any proposed deficiency or adjustment by any Tax authority
challenging such Allocation.

     10. Section 338 Election. Buyer shall not make and shall not permit the
Company to make an election under Section 338(g) of the Code or any corresponding elections under
state or local Tax law, with respect to the transactions contemplated under this Agreement. During
the period beginning on the Closing Date and ending on December 31, 2011, Buyer shall cause the
Company and its Subsidiaries to operate their business consistent with past practice and shall not
undertake any restructurings outside of the ordinary course which have the effect of increasing
earnings and profits (other than earnings and profits generated in the ordinary course of
business). For the avoidance of doubt, provided that any such restructurings are properly treated
as tax-free under Code Section 332, 351 or 368 and do not have the effect of increasing earnings
and profits, the foregoing shall not prevent Buyer from engaging in such transactions.

     11. None of Buyer, the Company or any of its Subsidiaries shall amend any Tax
Return of the Company or any of its Subsidiaries for any Pre-Closing Tax Period or any Straddle
Period without the consent of the Seller Representative, which consent shall not be unreasonably
withheld. For the avoidance of doubt, if such amendment would give rise to adverse Tax
consequences to any Seller, it shall not be considered unreasonable for the Seller Representative
to withhold its consent.

     D. WARN.

     1. Between the date hereof and the Closing Date, the Company agrees that it shall
not, nor shall it permit any of its Subsidiaries to, effectuate a “plant closing” or “mass layoff”
as those terms are defined in WARN without complying in all material respects with the notice
requirements and all other provisions of WARN.

     2. Buyer agrees that it shall not, nor shall it permit the Company or any of its
Subsidiaries to, at any time prior to 90 days after the Closing Date, effectuate a “plant closing”
or “mass layoff” as those terms are defined in WARN without complying in all material respects with
the notice requirements and all other provisions of WARN.

     E. Further Assurances. Subject to the limitations set forth elsewhere in this
Agreement, from time to time, as and when requested by any party hereto and at such party’s
expense, any other party shall execute and deliver, or cause to be executed and delivered, all such
documents and instruments and shall take, or cause to be taken, all such further or other actions
as the requesting party may reasonably deem necessary or desirable to evidence and effectuate the
transactions contemplated by this Agreement.

XII.

DEFINITIONS

     A. Definitions. For purposes hereof, the following terms, when used herein with initial
capital letters, shall have the respective meanings set forth herein:

“Accounts Receivable” shall mean all bona fide accounts receivable of the Company or any of
its Subsidiaries (exclusive of any notes receivable and any accounts receivable from Affiliates or
Related Persons of Sellers, the Company, or any of its Subsidiaries) as of the Closing Date.

“Affiliate” of any particular Person means any other Person controlling, controlled by or
under common control with such particular Person. For the purposes of this definition, “control”
means the possession, directly or indirectly, of the power to direct the management and policies of
a Person whether through the ownership of voting securities, contract or otherwise.

“Cash on Hand” means, with respect to the Company and its Subsidiaries, all cash (for
avoidance of doubt, cash shall include deposits in transit and all outstanding checks of the
Company shall be deducted), cash equivalents, marketable securities and government refunds (minus
all cash, cash equivalents, marketable securities and government refunds that are the subject of
any contemplated Dividend Payment set forth on Schedule VII.G), as of the Determination
Moment; provided that no asset shall be included more or less than once in such
determination. Notwithstanding the foregoing, to the extent any Dividend Payment set forth on
Schedule VII.G as of the Closing exceeds (i) the amount of all cash (for avoidance of
doubt, cash shall include deposits in transit and all outstanding checks of the Company shall be
deducted), cash equivalents and marketable securities as of the Determination Moment of the
Subsidiary making such Dividend Payment, plus (ii) any amounts paid by any Person
(including any governmental authority) to such Subsidiary or any Affiliate thereof for purposes of
paying such Dividend Amount, such excess amount shall (without duplication of any repayment or
prior adjustment) be deducted from the calculation of Cash on Hand.

“Class A Unit” means an interest in the Company designated as a Class A Unit.

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“Class B Unit” means an interest in the Company designated as a Class B Unit.

“Closing Date Indebtedness” means, with respect to the Company and its Subsidiaries, all
outstanding and unpaid Indebtedness, as of the Determination Moment; provided that no
outstanding and unpaid Indebtedness shall be included more or less than once in such determination.

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

“Company Transaction Expenses” means (i) all fees and expenses payable to the Company’s
advisors and other fees from and expenses of professional service firms incurred by the Company or
for which the Company is liable or responsible in connection with the transactions contemplated by
this Agreement in each case to the extent unpaid as of the Closing, including, without limitation
the premiums for any tail coverage policy obtained by the Company pursuant to Section
7.02(c) which are unpaid as of Closing and (ii) the aggregate amount of any payments due to
Norwest Equity Partners VI, LP, Norwest Equity Partners VII, LP, or Norwest Equity Partners VIII,
LP upon termination of the certain Amended and Restated Strategic Consulting Agreement, dated as of
August 30, 2007.

“Company’s Accounting Practices and Procedures” means the accounting methods, policies,
practices and procedures, including classification and estimation methodology, used by the Company
in the preparation of the 2010 Audited Balance Sheet as of December 31, 2010.

“Confidentiality Agreement” means the Confidentiality Agreement dated as of March 19,
2011, between Buyer and the Company.

“Determination Moment” means 11:59 p.m. local time on the date immediately preceding the
Closing Date, at the respective principal places of business of the Company and its Subsidiaries
with respect to each country in which the Company or its Subsidiaries, as the case may be, have a
place of business.

“Disbursing Agent” means Wells Fargo Bank, N.A., acting in its capacity as disbursing agent
under the Disbursing Agent Agreement.

“Disbursing Agent Agreement” means a disbursing agent agreement to be entered into at the
Closing among Buyer, the Seller Representative and the Disbursing Agent, in the form attached
hereto as Exhibit B.

“Disclosure Schedules” means the disclosure schedules attached to this Agreement.

“Employee Benefit Plan” means each “employee benefit plan” (as such term is defined in
Section 3(3) of ERISA), excluding any Multiemployer Plans, and each other material employment,
severance, change in control, consulting, or similar contract, arrangement, policy, plan or program
providing for insurance coverage (including, without limitation, any self-insured arrangements),
disability benefits, bonuses, profit sharing, deferred compensation, stock options, equity
compensation incentives, vacation, sick leave, paid time-off, retirement or fringe benefit that is
maintained, sponsored or contributed to by the Company or its Subsidiaries on behalf of their
current or former employees, directors or independent consultants, other than a Foreign Plan.

“Environmental Requirements” means all Legal Requirements governing pollution (or the
cleanup thereof) or protection of the environment (including ambient air, soil, surface water or
groundwater, or subsurface strata), natural resources, or human health, including, without
limitation, all Legal Requirements relating to the presence, exposure, management, manufacture,
reclamation, use, reuse, production, generation, handling, transportation, treatment, containment,
storage, disposal, processing, discharge, Release, control, remediation or cleanup of any Hazardous
Materials. The term “Environmental Requirement” includes, without limitation, the following
(including their implementing regulations and any state or foreign analogs): the Comprehensive
Environmental Response, Compensation, and Liability Act of 1980, as amended by the Superfund
Amendments and Reauthorization Act of 1986, 42 U.S.C. §§ 9601 et seq.; the Solid Waste Disposal
Act, as amended by the Resource Conservation and Recovery Act of 1976, as amended by the Hazardous
and Solid Waste Amendments of 1984, 42 U.S.C. §§ 6901 et seq.; the Federal Water Pollution Control
Act of 1972, as amended by the Clean Water Act of 1977, 33 U.S.C. §§ 1251 et seq.; the Toxic
Substances Control Act of 1976, as amended, 15 U.S.C. §§ 2601 et seq.; the Emergency Planning and
Community Right-to-Know Act of 1986, 42 U.S.C. §§ 11001 et seq.; and the Clean Air Act of 1966, as
amended by the Clean Air Act Amendments of 1990, 42 U.S.C. §§ 7401 et seq.

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

“Escrow Agent” means Wells Fargo Bank, N.A., acting in its capacity as escrow agent under
the Escrow Agreement.

“Escrow Agreement” means an escrow agreement to be entered into at the Closing among Buyer,
the Seller Representative and the Escrow Agent, in the form attached hereto as Exhibit A.

“Escrow Fund” means the fund created by the Escrow Agent to hold the Escrow Amount pursuant
to the Escrow Agreement.

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

“Hazardous Materials” means all wastes, pollutants, chemicals, products (including
asbestos), derivatives, compounds, mixtures, solids, liquids, mineral or gas contaminants or
hazardous, dangerous or toxic substances or materials, in each case, whether naturally occurring or
manmade, that is hazardous, acutely hazardous or toxic under Environmental Requirements, including
petroleum and petroleum products and any other substance or material that is regulated pursuant to
any Environmental Requirement, or the use or Release of which could result in liability under any
Environmental Requirement.

“HSR Act” means the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended.

“Indebtedness” means, without duplication, the sum of (i) all obligations of the Company
and its Subsidiaries for borrowed money or issued in substitution for or exchange of indebtedness
for borrowed money, (ii) other indebtedness of the Company and its Subsidiaries evidenced by
notes, bonds, debentures or other debt securities, (iii) indebtedness of the types described in
clauses (i) and (ii) guaranteed, directly or indirectly, in any manner by the Company or any of its
Subsidiaries through an agreement, contingent or otherwise, to supply funds to, or in any other
manner, invest in, the debtor, or to purchase indebtedness, primarily for the purpose of enabling
the debtor to make payment of the indebtedness or to assure the owners of indebtedness against
loss, (iv) indebtedness for the deferred purchase price of property or services with respect to
which the Company or any of its Subsidiaries is liable, other than ordinary course trade payables,
(v) all obligations of the Company and its Subsidiaries as lessee or lessees under leases that have
been recorded as capital leases in accordance with GAAP, (vi) all payment obligations

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under any
interest rate swap agreements or interest rate hedge agreements to which the Company or any of its
Subsidiaries is party, (vii) any interest owed with respect to the indebtedness referred to above
and prepayment premiums or fees related thereto, and (viii) any amounts described in Section
VII.F.4 that remain unpaid as of the Closing. For the avoidance of doubt, Indebtedness shall
not include any (a) guarantees by the Company or any of its Subsidiaries of indebtedness of the
types described in clauses (i) and (ii) of any other Subsidiary of the Company,
(b) letters of credit which have not been drawn down, (c) performance guarantees or bonds, sureties
and/or similar obligations of any kind or nature issued by or on behalf of the Company or any of
the Subsidiaries, (d) intercompany accounts, payables or loans of any kind or nature, and (e)
accounts payable, accrued liabilities (excluding any accrual in relation to borrowings not included
in Net Working Capital), deferred income taxes, accrued income taxes, pension and post-retirement
benefits (including those set forth on Schedule I.C), deferred revenue and commitments
under non-cancelable operating leases.

“Intellectual Property” means all U.S. and foreign intellectual property, including
Software, patents, trademarks, service marks, domain names, copyrights, copyrighted works, and any
registrations or applications for the registration of any of the foregoing, and any trade secrets,
confidential information, and know-how.

“Inventory” shall mean all raw material, work in process and finished goods inventory of
the Business.

“Legal Requirement” means any federal, state, provincial, local, municipal, foreign,
international, multinational or other rule, order, code, judgment, decree, constitution, law,
ordinance, regulation, statute or treaty.

“Lien” shall mean any claim, lien, pledge, option, charge, easement, security interest,
right of way, encroachment, reservation, restriction, encumbrance, or other right of any Person, or
any other restriction or limitation of any nature whatsoever.

“Losses” means losses, damages, liabilities, deficiencies, actions, judgments, interest,
awards, penalties, fines, costs or expenses of whatever kind, including reasonable attorneys’ fees
and the cost of enforcing any right to indemnification hereunder and the cost of pursuing any
insurance providers, including, without limitation, punitive, special, consequential, incidental or
exemplary damages; provided that Losses shall only include (i) punitive or exemplary
damages to the extent that a third party is entitled to such damages against the Indemnitee based
on the actions of the Indemnitor pursuant to Article IX hereof and (ii) special or consequential
damages to the extent such damages are solely attributable to special circumstances that have been
disclosed to or are reasonably foreseeable by the Company as of the date hereof.

“Material Adverse Change” means any change, effect, event, occurrence, state of facts or
development that is materially adverse to the business, assets, financial condition or results of
operations of the Company and its Subsidiaries, individually or taken as a whole; provided,
however, that any of the following, alone or in combination, shall not be deemed to constitute a
Material Adverse Change, nor shall any of the following (or the effect thereof) be taken into
account in determining whether there has been or will be a Material Adverse Change: (i) general
economic or securities or financial market conditions in any economy or market in which the Company
or its Subsidiaries do business, (ii) any occurrence or condition generally affecting the industry
in which the Company and its Subsidiaries operate (including natural catastrophe events), (iii) any
change in law or regulations in any jurisdiction in which the Company or any Subsidiary of the
Company does business or any change in accounting principles required by GAAP or any applicable
foreign equivalent, (iv) the execution or announcement of this Agreement or relating to compliance
by any party hereto with the provisions hereof or the pendency or execution of any of the
transactions contemplated hereby, or (v) any natural disaster, military actions or any acts of
terrorism, sabotage or war or the outbreak or escalation of hostilities or any of the foregoing or
change in geopolitical conditions, except, in the case of clauses (i), (ii), (iii) and (v), to the
extent such change, effect, event, occurrence, state of facts or development, has had a
disproportionate effect on the Company and its Subsidiaries, taken as a whole.

“Multiemployer Plan” shall have the meaning set forth in Section 3(37) of ERISA.

“Net Tax Reserve Amount” means the amount of the accruals and reserves for Taxes taken into
account in the calculation of the Net Working Capital Amount in determining the total consideration
payable by Buyer pursuant to this Agreement. For the avoidance of doubt, all deferred tax assets
and liabilities shall be excluded from the calculation of Net Tax Reserve Amount.

“Net Working Capital” means the amount of total current assets minus the amount of total
current liabilities of the Company and its Subsidiaries on a consolidated basis determined in
accordance with GAAP applied consistently with the Company’s Accounting Practices and Procedures as
of the Determination Moment. Notwithstanding the foregoing, the calculation of these amounts shall
take account of the agreement by the parties hereto to include or exclude the items set forth on
Schedule XII.A(a).

“Net Working Capital Amount” means the Net Working Capital of the Company and its
Subsidiaries as of the Determination Moment; provided that no asset or liability shall be
included more or less than once in such determination.

“Owned Tangible Personal Property” shall mean all Tangible Personal Property owned by the
Corporation and its Subsidiaries.

“Percentage Share” means with respect to each Seller, the amount set forth opposite such
Seller’s name on Schedule I.B under the heading “Percentage Share”.

“Permitted Liens” means: (i) any restriction on transfer arising under applicable
securities law; (ii) liens for current Taxes or other governmental charges not yet due and payable
or the amount or validity of which is being contested in good faith by appropriate proceedings by
the Company and its Subsidiaries; (iii) mechanics’, carriers’, workers’, repairers’, landlords’
and similar statutory liens arising or incurred in the ordinary course of business for amounts
which are not delinquent and were reflected on the 2010 Balance Sheet or the Latest Balance Sheet,
or, to the extent outstanding as of the Closing Date, were reflected on the Closing Balance Sheet
and taken into account in the final determination of Net Working Capital or Closing Date
Indebtedness; (iv) zoning, entitlement, building and other land use regulations imposed by
governmental agencies having jurisdiction over the Owned Real Property or the Leased Real Property
which are not violated by the current use and operation of the Owned Real Property or the Leased
Real Property; (v) covenants, conditions, restrictions, easements and other similar matters of
record affecting title to the Owned Real Property or the Leased Real Property which do not,
individually or in the aggregate, materially impair the occupancy or use of the Owned Real Property
or the Leased Real Property for the purposes for which it is currently operated or used in
connection with the
Company’s and its Subsidiaries’ businesses; (vi) liens, security interests
and/or other encumbrances affecting or encumbering the right, title and/or interest of the
landlord/fee owner with respect to the Leased Real Property which do not materially impair or
interfere with the occupancy, operation or use of the Leased Real Property for the purposes for
which it is currently operated or used in connection with the

34

 

Company’s and its Subsidiaries’
businesses; (vii) non-monetary liens or encumbrances which do not materially impair or interfere
with the occupancy, operation or use of the Owned Real Property or the Leased Real Property for the
purposes for which it is currently operated or used in connection with the Company’s and its
Subsidiaries’ businesses; (viii) liens arising under worker’s compensation, unemployment insurance,
social security, retirement and similar legislation; (ix) purchase money liens and liens securing
rental payments under capital lease arrangements
and that were reflected on the 2010 Balance Sheet or the Latest Balance Sheet, or, to the extent
outstanding as of the Closing Date, were reflected on the Closing Balance Sheet and taken into
account in the final determination of Net Working Capital or Closing Date Indebtedness; (x) liens
of lessors and licensors arising under lease agreements or license arrangements; (xi) other liens
arising in the ordinary course of business and not incurred in connection with the borrowing of
money and that were reflected on the 2010 Balance Sheet or the Latest Balance Sheet, or, to the
extent outstanding as of the Closing Date, were reflected on the Closing Balance Sheet and taken
into account in the final determination of Net Working Capital or Closing Date Indebtedness; (xii)
liens securing any of the Company’s credit facilities or other Indebtedness to be paid off at the
Closing; and (xiii) those liens set forth on Schedule A(b).

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

“Pre-Closing Period” means (i) any Pre-Closing Tax Period or (ii) the portion of any
Straddle Period ending on the Closing Date.

“Related Person” shall mean (i) any shareholder, member, manager, director or officer or
any other direct or indirect beneficial owner (but excluding mere holders of options to purchase
shares) of the Company or any of its Subsidiaries, (ii) any spouse, child, sibling or parent of any
such shareholder, member, manager, director or officer or other beneficial owner, or (iii) any
limited liability company, partnership, corporation, trust or other entity in which any individual
encompassed by the foregoing (i) or (ii) has a substantial and material interest as a member,
partner, shareholder, trustee or otherwise.

“Release” means any actual or threatened release, spilling, leaking, pumping, pouring,
emitting, emptying, discharging, injecting, escaping, leaching, dumping, abandonment, disposing or
allowing to escape or migrate into or through the environment (including, without limitation,
ambient air (indoor or outdoor), surface water, groundwater, land surface or subsurface strata or
within any building, structure, facility or fixture).

“Software” shall mean computer software of whatever kind or purpose, including object code,
source code, tools, developers kits, utilities, graphical user interfaces, menus, images, icons,
and forms, and all software stored or contained therein or transmitted thereby, and related
documentation.

“Subsidiary or Subsidiaries” means, with respect to any Person of which (i) if a
corporation, a majority of the total voting power of shares of stock entitled (without regard to
the occurrence of any contingency) to vote in the election of directors, managers, or trustees
thereof is at the time owned or controlled, directly or indirectly, by that Person or one or more
of the other Subsidiaries of that Person or a combination thereof or (ii) if a limited liability
company, partnership, association or other business entity (other than a corporation), a majority
of partnership or other similar ownership interest thereof is at the time owned or controlled,
directly or indirectly, by that Person or one or more Subsidiaries of that Person or a combination
thereof and for this purpose, a Person or Persons owns a majority ownership interest in such a
business entity (other than a corporation) if such Person or Persons shall be allocated a majority
of such business entity’s gains or losses or shall be or control any managing director or general
partner of such business entity (other than a corporation).

“Tangible Personal Property” shall mean all tangible personal property (other than
inventory) owned or leased by the Company or its Subsidiaries or in which the Company or any
Subsidiary of the Company have any interest including, without limitation, show equipment,
production and processing equipment, warehouse equipment, computer hardware, furniture and
fixtures, transportation equipment, leasehold improvements, supplies and other tangible assets,
together with any transferable manufacturer or vendor warranties related thereto.

“Target Net Working Capital Amount” means $51,000,000.

“Tax” or “Taxes” means any United States federal, state, local or foreign income,
gross receipts, franchise, estimated, alternative minimum, add-on minimum, sales, use, transfer,
real property gains, registration, value added, excise, natural resources, severance, stamp,
occupation, premium, windfall profit, environmental, customs, duties, real property, special
assessment, personal property, capital stock, social security, unemployment, disability, payroll,
license, employee or other withholding, or other tax, of any kind whatsoever, including any
interest, penalties or additions to tax.

“Tax Return” or “Tax Returns” means any return, declaration, report, claim for
refund, information return or statement relating to Taxes, including schedules or attachments
thereto, and including any amendments thereof.

“Title IV Plan” means any “pension plan” under Section 3(2) of ERISA that is subject to
Title IV of ERISA (other than a Multiemployer Plan).

“Transaction Payment Amount” means an amount equal to the aggregate unfunded severance and
similar liabilities of the Company to its employees and agents, including payments to employees and
agents of the Company that become due and payable solely as a result of the consummation of the
transactions contemplated by this Agreement, in each case, as set forth on Schedule
XII.A(c).

“Treasury Regulations” means the United States Treasury regulations promulgated under the
Code.

35

 

     B. Cross-Reference of Other Definitions. Each capitalized term listed below is defined
in the corresponding Section of this Agreement:

	 	 	 	 	 

	Term	 	Section No.	 
	2010 Audited Balance Sheet
	 	 	4.05	(a)
	Agreement
	 	Preamble	 
	Allocation
	 	 	11.03	(i)
	Assumed Liabilities
	 	 	1.03	 
	Audited Financial Statements
	 	 	4.05	(a)
	Authorized Action
	 	 	10.03	 
	Buyer
	 	Preamble	 
	Buyer Indemnified Parties
	 	 	9.02	(a)
	Buyer Plans
	 	 	7.06	(b)
	Buyer’s Representatives
	 	 	6.02	 
	Cap
	 	 	9.02	(c)
	Claim
	 	 	10.02	 
	Closing
	 	 	1.04	(a)
	Closing Balance Sheet
	 	 	1.05	(a)
	Closing Date
	 	 	1.04	(a)
	Closing Payment Certificate
	 	 	1.01	(a)
	Closing Statement
	 	 	1.05	(a)
	Company
	 	Preamble	 
	Company Employee
	 	 	7.06	(a)
	Company Securities
	 	 	4.04	(b)
	Deductible
	 	 	9.02	(c)
	Distributions
	 	 	7.07	 
	Dividend Payment
	 	 	7.07	 
	Escrow Amount
	 	 	1.06	 
	Estimated Cash On Hand
	 	 	1.01	(a)
	Estimated Closing Date Indebtedness
	 	 	1.01	(a)
	Estimated Net Working Capital Amount
	 	 	1.01	(a)
	Exception Claims
	 	 	9.06	 
	Exchange Act
	 	 	5.05	 
	Existing Plans
	 	 	7.06	(b)
	Final Adjustment Amount
	 	 	1.05	(c)
	Financial Statements
	 	 	4.05	(a)
	Foreign Authority
	 	 	7.03	(b)
	Foreign Equivalents
	 	 	3.04	 
	Foreign Plan
	 	 	4.12	(l)
	French Legal Requirements
	 	 	3.04	 
	Holdback Floor
	 	 	1.06	 
	Indebtedness Payoff Amount
	 	1.04	(b)(iii)
	Indemnification Notice
	 	 	9.06	 
	Indemnitee
	 	 	9.06	 
	Indemnitor
	 	 	9.06	 
	Independent Auditor
	 	 	1.05	(a)
	Latest Balance Sheet
	 	 	4.05	(a)
	Leased Real Property
	 	 	4.07	(c)
	Licenses
	 	 	4.19	 
	Objections Statement
	 	 	1.05	(a)
	Owned Real Property
	 	 	4.07	(b)
	Pre-Closing Tax Period
	 	 	9.02	(a)
	Purchase Price
	 	 	1.01	(b)
	Qualified Plan
	 	 	4.12	(c)
	Real Property Leases
	 	 	4.07	(c)
	Regulatory Conditions
	 	 	8.01	(d)
	Related Person Transaction
	 	 	4.16	 
	Replenishment Amount
	 	 	1.06	 
	Replenishment Cap
	 	 	1.06	 
	Securities Act
	 	 	5.05	 
	Seller Indemnified Parties
	 	 	9.03	(a)
	Seller Representative
	 	 	10.01	 
	Seller Representative Holdback
	 	 	10.04	 
	Sellers
	 	Preamble	 
	Special Losses
	 	 	9.02	(a)
	Specific Indemnification Items
	 	 	9.02	(a)
	Straddle Period
	 	 	9.02	(a)
	Survival Period
	 	 	9.01	 
	Tax Benefit
	 	 	9.07	 
	Tax Matter
	 	 	11.03	(g)
	the Company’s knowledge
	 	 	13.03	 
	Transfer Taxes
	 	 	11.03	(f)
	Unaudited Financial Statements
	 	 	4.05	(a)
	Units
	 	Recitals	 
	WARN
	 	 	4.17	(e)

36

 

XIII.

MISCELLANEOUS

     A. Press Releases and Communications. No press release or public announcement related to
this Agreement or the transactions contemplated herein, any other announcement or communication to
the employees, consultants, customers or suppliers of the Company or any of its Subsidiaries, shall
be issued or made by any party hereto or any of their controlled Affiliates without the joint
approval of Buyer and the Seller Representative; provided, however that Buyer may
issue press releases or make public statements or communications without Seller Representative’s
approval to the extent Buyer’s counsel advises it to be required by law or the rules of the New
York Stock Exchange as applicable to Buyer, so long as Buyer gives Seller Representative a
reasonable opportunity to review such press release, announcement or communication before its
release.

     B. Expenses. Regardless of whether the transactions contemplated hereby are consummated,
Buyer shall pay all of its own expenses (including attorneys’ and accountants’ fees and expenses)
in connection with the negotiation of this Agreement, the performance of its obligations hereunder
and the consummation of the transactions contemplated by this Agreement. If the transactions
contemplated hereby are not consummated, the Company shall pay all of its own expenses (including
attorneys’ and accountants’ fees and expenses) in connection with the negotiation of this
Agreement, and the consummation of the transactions contemplated by the Agreement.

     C. Knowledge Defined. For purposes of this Agreement, the term “the Company’s
knowledge” and similar terms as used herein shall mean the actual knowledge, information or belief
of Stuart Schoenmann, Joe White, Blake Fennell and Bill Polito after conducting a reasonable
investigation.

     D. Notices. All notices, requests, demands, claims or other communications to be given
or delivered under or by reason of the provisions of this Agreement shall be in writing and shall
be deemed to have been given when personally delivered or transmitted by facsimile (when
confirmation of transmission is received), one day after deposit with Federal Express or similar
overnight courier service or three days after being mailed by first class mail, return receipt
requested. Notices, requests, demands, claims and communications to Buyer, the Company, and the
Seller Representative shall, unless another address is specified in writing, be sent to the
addresses indicated below:

 Notices to Buyer, or, following the Closing, the Company: 

IDEX Corporation

1925 West Field Court

Lake Forest, Illinois 60045

Attn: Frank J. Notaro, Esq.

         Daniel J. Salliotte

Tel: (847) 498-7070

Fax: (847) 498-9123

 with a copy to:

Hodgson Russ LLP

The Guaranty Building

140 Pearl Street, Suite 100

Buffalo, New York 14202-4040

Attn: Richard F. Campbell, Esq.

         Brad A. Birmingham, Esq.

Tel: (716) 856-4000

Fax: (716) 849-0349

Notices to the Seller Representative:

c/o Norwest Equity Partners

3600 IDS Center

80 South 8th Street

Minneapolis, Minnesota 55402

Attn: Tom Schauerman

Tel: (612) 215-1695

Fax: (612) 215-1601

with a copy to:

37

 

Latham & Watkins LLP

355 South Grand Avenue

Los Angeles, California 90071

Attn: Jeffrey L. Kateman and Jason H. Silvera

Tel: (213) 485-1234

Fax: (213) 891-8763

     Any party may change the address to which notices, requests, demands, claims, and other
communications required or permitted hereunder are to be delivered by giving the other party(ies)
notice in the manner herein set forth.

     E.
Assignment. This Agreement and all of the provisions hereof shall be binding upon
and inure to the benefit of the parties hereto and their respective successors and permitted
assigns, except that neither this Agreement nor any of the rights, interests or obligations
hereunder may be assigned or delegated (i) by Buyer or the Company without the prior written
consent of the Seller Representative or (ii) by the Sellers without the prior written consent of
Buyer. Notwithstanding the foregoing, Buyer may assign all or a portion of its rights and
obligations under this Agreement to one or more Affiliates of Buyer, provided that Buyer shall
remain liable hereunder notwithstanding any such assignment. Nothing in this Agreement, express or
implied, is intended to or shall confer upon any Person other than the parties hereto or their
respective successors and permitted assigns, any rights, remedies or liabilities under or by reason
of this Agreement, other than sections which are specifically for the benefit of Seller Indemnified
Parties (including Section VII.B, Section IX.B, Section IX.C, Section
IX.I, Section XI.B, and this Section E), each of which is intended to be for
the benefit of the Persons covered thereby or to be paid thereunder and may be enforced by such
Persons.

     F. Severability. Whenever possible, each provision of this Agreement shall be
interpreted in such manner as to be effective and valid under applicable law, but if any provision
of this Agreement is held to be prohibited by or invalid under applicable law, such provision shall
be ineffective only to the extent of such prohibition or invalidity, without invalidating the
remainder of such provision or the remaining provisions of this Agreement.

     G. References. The table of contents and the section and other headings and subheadings
contained in this Agreement and the exhibits hereto are solely for the purpose of reference, are
not part of the agreement of the parties hereto, and shall not in any way affect the meaning or
interpretation of this Agreement or any exhibit hereto. All references to days or months shall be
deemed references to calendar days or months. All references to “$” or “dollars” shall be deemed
references to United States dollars. Unless the context otherwise requires, any reference to a
“Section,” “Exhibit,” or “Schedule” shall be deemed to refer to a section of this Agreement,
exhibit to this Agreement or a schedule to this Agreement, as applicable. Any reference to any
federal, state, county, local or foreign statute or law shall be deemed also to refer to all rules
and regulations promulgated thereunder, unless the context requires otherwise. For all purposes of
and under this Agreement, (i) the word “including” shall be deemed to be immediately followed by
the words “without limitation”; (ii) words (including defined terms) in the singular shall be
deemed to include the plural and vice versa; (iii) words of one gender shall be deemed to include
the other gender as the context requires; (iv) “or” is not exclusive; and (v) the terms “hereof,”
“herein,” “hereto,” “herewith” and any other words of similar import shall, unless otherwise
stated, be construed to refer to this Agreement as a whole (including the exhibits hereto and the
Disclosure Schedules) and not to any particular term or provision of this Agreement, unless
otherwise specified.

     H. No Strict Construction. The language used in this Agreement shall be deemed to be
the language chosen by the parties hereto to express their mutual intent, and no rule of strict
construction shall be applied against any Person.

     I. Amendment and Waiver. Any provision of this Agreement or the schedules or exhibits
may be amended or waived only in a writing signed by Buyer, the Company and the Seller
Representative. No waiver of any provision hereunder or any breach or default thereof shall extend
to or affect in any way any other provision or prior or subsequent breach or default.

     J. Complete Agreement. This Agreement (including the exhibits hereto and the Disclosure
Schedules) and the documents referred to herein (including the Confidentiality Agreement and the
Escrow Agreement) contain the complete agreement between the parties hereto and supersede any prior
understandings, agreements or representations by or between the parties, written or oral, which may
have related to the subject matter hereof in any way.

     K. Counterparts. This Agreement may be executed in multiple counterparts (including by
means of telecopied or .pdf signature pages), any one of which need not contain the signatures of
more than one party, but all such counterparts taken together shall constitute one and the same
instrument.

     L. Waiver of Jury Trial. EACH OF THE PARTIES HERETO HEREBY WAIVES TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY WITH RESPECT TO ANY LITIGATION
DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT OR THE
TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT. EACH OF THE PARTIES HERETO HEREBY (A) CERTIFIES THAT
NO REPRESENTATIVE, AGENT OR ATTORNEY OF THE OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE,
THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER
AND (B) ACKNOWLEDGES THAT IT HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE TRANSACTIONS
CONTEMPLATED BY THIS AGREEMENT, AS APPLICABLE, BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND
CERTIFICATIONS IN THIS SECTION XIII.L.

     M. Specific Performance. Each of the parties to this Agreement acknowledges and agrees
that the other parties to this Agreement would be irreparably damaged in the event that any of the
terms or provisions of this Agreement are not performed in accordance with

38

 

their specific terms or otherwise are breached. Therefore, notwithstanding anything to the
contrary set forth in this Agreement, each of the parties to this Agreement hereby agrees that the
other parties to this Agreement shall be entitled to an injunction or injunctions to prevent
breaches of any of the terms or provisions of this Agreement, and to enforce specifically the
performance by such first party under this Agreement, and each party to this Agreement hereby
agrees to waive the defense in any such suit that the other parties to this Agreement have an
adequate remedy at law and to interpose no opposition, legal or otherwise, as to the propriety of
injunction or specific performance as a remedy, and hereby agrees to waive any requirement to post
any bond in connection with obtaining such relief. The equitable remedies described in this
Section XIII.M shall be in addition to, and not in lieu of, any other remedies at law or in
equity that the parties to this Agreement may elect to pursue.

     N. Governing Law; Consent to Jurisdiction. All matters relating to the
interpretation, construction, validity and enforcement of 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 laws of any jurisdiction other than the State of
Delaware. Each of the parties to this Agreement hereby irrevocably and unconditionally submits,
for itself and its assets and properties, to the exclusive jurisdiction of the Chancery Court of
the State of Delaware and any state appellate court therefrom within the State of Delaware (or, if
the Chancery Court of the State of Delaware declines to accept jurisdiction over a particular
matter, any state or federal court within the State of Delaware), in any action or proceeding
arising out of or relating to this Agreement, the agreements delivered in connection with this
Agreement, or the transactions contemplated hereby or thereby, or for recognition or enforcement of
any judgment relating thereto, and each of the parties to this Agreement hereby irrevocably and
unconditionally (i) agrees not to commence any such action or proceeding except in such courts;
(ii) agrees that any claim in respect of any such action or proceeding may be heard and determined
in such Chancery Court of the State of Delaware or any state appellate court therefrom; (iii)
waives, to the fullest extent it may legally and effectively do so, any objection which it may now
or hereafter have to the laying of venue of any such action or proceeding in any such Delaware
Chancery or state appellate court therefrom; and (iv) waives, to the fullest extent permitted by
law, the defense of lack of personal jurisdiction or an inconvenient forum to the maintenance of
such action or proceeding in any such Delaware court. Each party hereto agrees that (i) this
Agreement involves at least $100,000.00 and (ii) this Agreement has been entered into by the
parties hereto in express reliance upon 6 Del. C. § 2708. Each of the parties to this Agreement
hereby agrees that a final judgment in any such action or proceeding shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any other manner provided by law.
Each of the parties to this Agreement hereby irrevocably consents to service of process in the
manner provided for notices in Section XIII.D. Nothing in this Agreement shall affect the
right of any party to this Agreement to serve process in any other manner permitted by applicable
law.

     O. Legal Representation; Conflict Waiver Acknowledgement. By approval of
this Agreement and the transactions contemplated hereby, each Seller acknowledges and agrees that
the law firm of Latham & Watkins LLP is representing only the Company and the Seller Representative
with respect to the transactions contemplated hereby, and each Seller understands that he, she or
it is strongly encouraged to retain his own attorney, accountant and other representatives to
advise him, her or it with respect to the transactions contemplated by this Agreement and the
legal, tax, accounting, financial and other impact thereon on such Seller. The parties acknowledge
Latham & Watkins LLP’s historical representation of IDEX Corporation and its Affiliates with
respect to a variety of different legal matters. The parties further acknowledge that, for the
negotiation, preparation, execution and delivery of this Agreement and for representation with
respect to the transactions contemplated thereunder, IDEX Corporation has engaged separate legal
counsel and waived the conflict of interest arising from Latham & Watkins LLP’s representation of
the Company and the Seller Representative with respect to this matter. Notwithstanding the
foregoing restriction, Buyer, for itself and the Company and for Buyer’s and the Company’s
respective successors and assigns, irrevocably acknowledges and agrees that all communications
between the Sellers and/or the Company and its Subsidiaries and counsel, including, without
limitation, Latham & Watkins LLP, made in connection with the negotiation, preparation, execution,
delivery and closing under, or any dispute or proceeding arising under or in connection with, this
Agreement which, immediately prior to the Closing, would be deemed to be privileged communications
of the Sellers and their counsel and would not be subject to disclosure to Buyer or the Company in
connection with any process relating to a dispute arising under or in connection with, this
Agreement or otherwise, shall continue after the Closing to be privileged communications between
the Sellers and such counsel and none of Buyer, the Company or any Person acting or purporting to
act on behalf of or through Buyer or the Company shall seek to obtain the same by any process on
the grounds that the privilege attaching to such communications belongs to Buyer or the Company and
not the Sellers.

* * * *

39

 

     IN WITNESS WHEREOF, the parties hereto have executed this Securities Purchase Agreement on the
day and year first above written.

	 	 	 	 	 
	 	COMPANY:

CVI LASER, LLC

 	 
	 	By:  	/s/
Stuart Schoenmann 	 
	 	 	Name:  	Stuart Schoenmann 	 
	 	 	Its:       Chief Executive Officer 	 
	 
	 	BUYER:

IDEX CORPORATION

 	 
	 	By:  	/s/
Frank J. Notaro 	 
	 	 	Name:  	Frank J. Notaro 	 
	 	 	Its:             Vice President 	 
	 
	 	SELLER REPRESENTATIVE:

NORWEST EQUITY PARTNERS VII, LP

 	 
	 	By:  	Itasca LBO Partners VII, LLP
 	 
	 	 	Its:  General Partner 	 
	 	 	 
	 	By:  	
/s/ John E. Lindahl 	 
	 	 	Name:  	John E. Lindahl 	 
	 	 	Its:             Managing General Partner 	 

 

 

	 	 	 	 	 
	 	SELLERS:

NORWEST EQUITY PARTNERS VI, LP

 	 
	 	By:  	Itasca LBO Partners VI, LLP
 	 
	 	 	Its:  General Partner 	 
	 	 	 
	 	By:  	
/s/ John E. Lindahl 	 
	 	 	Name:  	John E. Lindahl 	 
	 	 	Its:             Managing General Partner 	 
	 
	 	NORWEST EQUITY PARTNERS VII, LP

 	 
	 	By:  	Itasca LBO Partners VII, LLP
 	 
	 	 	Its:  General Partner 	 
	 	 	 
	 	By:  	
/s/ John E. Lindahl 	 
	 	 	Name:  	John E. Lindahl 	 
	 	 	Its:             Managing General Partner 	 
	 
	 	NORWEST EQUITY PARTNERS VIII, LP

 	 
	 	By:  	Itasca LBO Partners VIII, LLP
 	 
	 	 	Its:  General Partner 	 
	 	 	 
	 	By:  	
/s/ John E. Lindahl 	 
	 	 	Name:  	John E. Lindahl 	 
	 	 	Its: Managing General Partner 	 
	 
	 	JOHN HALE

 	 
	 	By:  	/s/
John Hale 	 
	 	 	John Hale 	 
	 	 	 	 

 

 

	 	 	 	 	 

	 	 	 	 	 
	 	STUART SCHOENMANN

 	 
	 	By:  	/s/
Stuart Schoenmann 	 
	 	 	Stuart Schoenmann 	 
	 	 	 	 
	 
	 	JOSEPH WHITE

 	 
	 	By:  	/s/
Joseph White 	 
	 	 	Joseph White 	 
	 	 	 	 
	 
	 	ROBERT SOALES

 	 
	 	By:  	/s/
Robert Soales 	 
	 	 	Robert Soales 	 
	 	 	 	 
	 
	 	CAILONG BAO

 	 
	 	By:  	/s/
Cailong Bao 	 
	 	 	Cailong Bao 	 
	 	 	 	 
	 
	 	HELMUT KESSLER

 	 
	 	By:  	/s/
Helmut Kessler 	 
	 	 	Helmut Kessler 	 
	 	 	 	 
	 
	 	LYNORE ABBOTT

 	 
	 	By:  	/s/
Lynore Abbott 	 
	 	 	Lynore Abbott 	 
	 	 	 	 
	 
	 	BLAKE FENNELL

 	 
	 	By:  	/s/
Blake Fennell 	 
	 	 	Blake Fennell 	 
	 	 	 	 
	 
	 	LYNN STRICKLAND

 	 
	 	By:  	/s/
Lynn Strickland 	 
	 	 	Lynn Strickland 	 
	 	 	 	 
	 
	 	WILLIAM POLITO

 	 
	 	By:  	/s/
William Polito 	 
	 	 	William Polito 	 
	 	 	 	 
	 
	 	DAVID HARGIS

 	 
	 	By:  	/s/
David Hargis 	 
	 	 	David Hargis 	 
	 	 	 	 
	 
	 	CFIC, INC. OF DELAWARE, a Delaware corporation

 	 
	 	By:  	/s/
Robert Roderick 	 
	 	 	Name:  	Robert Roderick 	 
	 	 	Title:  	Senior Vice Presidentexv10w1

Exhibit 10.1

OFFICER’S EMPLOYMENT AGREEMENT

     THIS AGREEMENT, is made and entered into as of this [Date] day of [Month], [Year],
by and between KENNAMETAL INC., (hereinafter referred to as “Kennametal” or the “Corporation”), a
corporation organized under the laws of the Commonwealth of Pennsylvania, for and on behalf of
itself and on behalf of its subsidiary companies, and [Officer’s Name], an individual (hereinafter
referred to as “Employee”).

WITNESSETH:

     WHEREAS, Employee acknowledges that by reason of his or her employment by Kennametal, it is
anticipated that Employee will work with, add to, create, have access to and be entrusted with
trade secrets and confidential information belonging to Kennametal which are of a technical nature
or business nature or pertain to future developments, the disclosure of which trade secrets or
confidential information would be highly detrimental to the interests of Kennametal; and

     WHEREAS, in order to have the benefit of Employee’s assistance, Kennametal is desirous of
employing or continuing the employment of Employee; and

     NOW, THEREFORE, Kennametal and Employee, each intending to be legally bound hereby, do
mutually covenant and agree as follows:

	1.	 	(a) Subject to the terms and conditions set forth herein, Kennametal hereby agrees to employ
Employee as of the date hereof, and Employee hereby accepts such employment and agrees to
devote his full time and attention to the business and affairs of Kennametal, in such capacity
or capacities and to perform to the best of his ability such services as shall be determined
from time to time by the Chief Executive Officer and the Board of Directors of Kennametal
until the termination of his employment hereunder.
	 
	 	 	(b) Employee’s base salary, the size of bonus awards, if any, granted to him and other
emoluments for his services, if any, shall be determined by the Board of Directors or its
Compensation Committee, as appropriate, from time to time in their sole discretion.

2. In addition to the compensation set forth or contemplated elsewhere herein, Employee shall be
entitled to participate in all employee benefit plans, programs and arrangements as and to the
extent provided to other executives of Kennametal, subject to the terms and conditions of this
Agreement and the terms and conditions from time to time of such plans, programs and arrangements.
Nothing herein contained shall be deemed to limit or prevent Employee, during his employment
hereunder, from being

 

 

reimbursed by Kennametal for out-of-pocket expenditures incurred for travel, lodging, meals,
entertainment expenses or any other expenses in accordance with the policies of Kennametal
applicable to the executives of Kennametal.

3. Employee’s employment may be terminated with or without any reason by either party hereto at
any time by giving the other party prior written notice thereof, provided, however, that any
termination on the part of Kennametal shall occur only if specifically authorized by its Board of
Directors; provided, further, that termination by Kennametal for Cause (as hereinafter defined)
shall be made by written notice which states that it is a termination for Cause; and provided,
further, that termination by Employee shall be on not less than 30 days prior written notice to
Kennametal.

	4.	 	(a) In the event that Employee’s employment is involuntarily terminated by Kennametal prior
to a Change-in-Control (as hereinafter defined) and other than for Cause, Employee will
receive, as severance pay, in addition to all amounts due him at the Date of Termination (as
hereinafter defined), the continuance of the Employee’s base salary (at the rate in effect on
the Date of Termination and subject to applicable deductions and withholdings) for twelve (12)
months following the Date of Termination. Any severance pay will be paid in substantially
equal installments, no less frequently than monthly, in accordance with Kennametal’s
established payroll policies and practices, as in effect on the Date of Termination, beginning
on the first normal pay date thereafter or, if later, the date the Employee’s release becomes
effective and irrevocable (with an aggregate initial installment representing the total amount
due as if severance payments commenced on the normal pay date immediately following the
Employee’s Date of Termination). Notwithstanding the foregoing, Kennametal may discontinue
any such severance payments if Kennametal reasonably determines that Employee has violated any
provision of this Agreement.
	 
	 	 	(b) In the event that Employee’s employment is terminated (i) due to the death of the
Employee or (ii) by Employee following a Change-in-Control (as hereafter defined) without
Good Reason (as such term in defined in Section 4(h)) or prior to a Change-in-Control (as
hereinafter defined), Employee will not be entitled to receive any severance pay in addition
to the amounts, if any, due him at the Date of Termination (as hereinafter defined).
	 
	 	 	(c) In the event that on or after a Change-in-Control (as hereinafter defined) and prior to
the third anniversary of the date of the Change-in-Control (as hereinafter defined)
Employee’s employment is terminated by Employee for Good Reason or involuntarily by
Kennametal other than for Cause or Disability pursuant to Section 5, Employee will receive
as severance pay (in addition to all other amounts due him at the Date of Termination) an
amount equal to the product of:

	 	(i)	 	the lesser of
	 
	 	 	 	(x) two and eight tenths (2.8),

- 2 -

 

	 	 	 	(y) a number equal to the number of calendar months remaining from the Date
of Termination to the Employee’s Retirement Date (as such term is hereafter
defined) divided by twelve (12), or
	 
	 	 	 	(z) a number equal to the product obtained by multiplying thirty-six (36)
less the number of completed months after the date of the Change-in-Control
during which the Employee was employed and did not have Good Reason for
termination times one-twelfth (1/12);

	 	 	 	times

	 	(ii)	 	the sum of
	 
	 	 	 	(x) Employee’s base salary at the annual rate in effect on the Date of
Termination (or, if greater, at the annual rate in effect on the first day
of the calendar month immediately prior to the Change-in-Control), plus
	 
	 	 	 	(y) the average of any bonuses which Employee was entitled to or paid during
the three most recent fiscal years ending prior to the Date of Termination
or, if the Employee is employed for less than one year, the target bonus for
the year in which the termination occurred.

	 	 	Subject to the provisions of Section 16, such severance pay shall be paid by delivery of a
cashier’s or certified check to the Employee at Kennametal’s executive offices on a date
which is no later than five business days following the Date of Termination or, if later,
the date the Employee’s release becomes effective and irrevocable.

     In addition to the severance payments provided for in this Section 4(c), Employee also
will receive the same or equivalent medical, dental, disability and group insurance benefits
as were provided to the Employee at the Date of Termination, which benefits shall be
provided to Employee for a three year period commencing on the Date of Termination.

	 	 	(d) The medical, dental, disability and group insurance benefits to be provided under
Section 4(c) will be provided as follows:

	 	 	 	(i) Life insurance benefits and disability benefits shall be provided through the
reimbursement of Employee’s premiums upon conversion to individual policy.
	 
	 	 	 	(ii) The first eighteen (18) months of medical and dental insurance coverage will be
available through the Consolidated Omnibus Budget Reconciliation Act of 1985, as
amended (“COBRA”). Provided the Employee timely elects COBRA continuation coverage,
the Employee shall continue to participate in all medical and dental insurance plans
he

- 3 -

 

	 	 	 	was participating in on the Date of Termination, and the Corporation shall pay the
applicable premium. To the extent that Employee had dependent coverage immediately
prior to the Date of Termination, such continuation of benefits for Employee shall
also cover Employee’s dependents for so long as Employee is receiving benefits under
this Section 4(d) and such dependents remain eligible. The COBRA continuation
period for medical and dental insurance under this Section 4(d) shall be deemed to
run concurrent with the continuation period federally mandated by COBRA, or any
other legally mandated and applicable federal, state, or local coverage period.
	 
	 	 	 	(iii) Following the conclusion of the COBRA continuation period, the Corporation
will provide coverage for the remainder of the three year period as follows:

	 	 	 	(a) If the relevant medical plan is self insured (within the meaning of
Section 105(h) of the Internal Revenue Code of 1986, as amended (the
“Code”)), and such plan permits coverage for the Employee, then the
Corporation will continue to provide coverage during the three year period
and will annually impute income to the Employee for the fair market value of
the premium.
	 
	 	 	 	(b) If, however, the plan does not permit the continued participation
following the end of the COBRA continuation period as contemplated above,
then the Corporation will reimburse Employee for the actual cost to Employee
of a comparable individual medical or dental insurance policy obtained by
Employee.

	 	 	 	(iv) Reimbursements to the Employee pursuant to the provisions of this Section 4(d)
will be available only to the extent that (a) such expense is actually incurred for
any particular calendar year and reasonably substantiated; (b) reimbursement shall
be made no later than the end of the calendar year following the year in which such
expense is incurred by the Employee; (c) no reimbursement provided for any expense
incurred in one taxable year will affect the amount available in another taxable
year; and (d) the right to this reimbursement is not subject to liquidation or
exchange for another benefit. Notwithstanding the foregoing, no reimbursement will
be provided for any expense incurred following the three year period contemplated by
this Agreement.

	 	 	(e) In the event of a termination of employment under the circumstances above described in
Section 4(c), Employee shall have no duty to seek any other employment after termination of
Employee’s employment with Kennametal and Kennametal hereby waives and agrees not to raise
or use any defense based on the position that Employee had a duty to mitigate or reduce the
amounts due him hereunder by seeking other employment whether suitable or unsuitable and
should Employee obtain other employment, then the only effect of such on the obligations of
Kennametal hereunder shall be that Kennametal shall be entitled to

- 4 -

 

	 	 	credit against any payments which would otherwise be made for medical, dental, disability
or group insurance pursuant to the benefit provisions set forth in the second paragraph of
Section 4(c) hereof, any comparable payments to which Employee is entitled under the
employee benefit plans maintained by Employee’s other employer or employers in connection
with services to such employer or employers after termination of his employment with
Kennametal.
	 
	 	 	(f) The term “Change-in-Control” shall mean a change in control of a nature that would be
required to be reported in response to Item 6(e) of Schedule 14A promulgated under the
Securities Exchange Act of 1934, as in effect on the date hereof (the “1934 Act”), or if
Item 6(e) is no longer in effect, any regulations issued by the Securities and Exchange
Commission pursuant to the 1934 Act which serve similar purposes; provided that, without
limitation, such a Change in Control shall be deemed to have occurred if (A) Kennametal
shall be merged or consolidated with any corporation or other entity other than a merger or
consolidation with a corporation or other entity all of whose equity interests are owned by
Kennametal immediately prior to the merger or consolidation, or (B) Kennametal shall sell
all or substantially all of its operating properties and assets to another person, group of
associated persons, corporation(s) or other entity(ies), or (C) any “person” (as such term
is used in Sections 13(d) and 14(d) of the 1934 Act), is or becomes a beneficial owner,
directly or indirectly, of securities of Kennametal representing 25% or more of the combined
voting power of Kennametal’s then outstanding securities coupled with or followed by the
existence of a majority of the board of directors of Kennametal consisting of persons other
than persons who either were directors of Kennametal immediately prior to or were nominated
by those persons who were directors of Kennametal immediately prior to such person becoming
a beneficial owner, directly or indirectly, of securities of Kennametal representing 25% or
more of the combined voting power of Kennametal’s then outstanding securities.

	 	(g)	 	For purposes of this Agreement, “Date of Termination” shall mean:
	 
	 	 	 	(i) if Employee’s employment is terminated due to his death or retirement, the date
of death or retirement, respectively;
	 
	 	 	 	(ii) if Employee’s employment is terminated for any other reason, the date on which
the termination becomes effective, as stated in the written notice of termination
given to or by the Employee; or
	 
	 	 	 	(iii) For purposes of this Agreement, the Employee will be considered to have
experienced a termination of employment only if the Employee has separated from
service with the Corporation and all of its controlled group members within the
meaning of Section 409A of the Code and the regulations and other guidance
promulgated thereunder (“Section 409A”). For purposes hereof, the determination of
controlled group members shall be made pursuant to the provisions of Section 414(b)
and 414(c) of the Code; provided that the language “at least 50 percent” shall be
used instead of “at least 80 percent” in each place it appears in Section

- 5 -

 

	 	 	 	1563(a)(1), (2) and (3) of the Code and Treas. Reg. § 1.414(c)-2. Whether the
Employee has separated from service will be determined based on all of the facts and
circumstances and in accordance with the guidance issued under Section 409A.

	 	 	(h) The term “Good Reason” for termination by the Employee shall mean the occurrence of any
of the following at or after a Change-in-Control:

	 	 	 	(i) without the Employee’s express written consent, the material diminution of
responsibilities or the assignment to the Employee of any duties materially and
substantially inconsistent with his positions, duties, responsibilities and status
with Kennametal immediately prior to a Change-in-Control, or a material change in
his reporting responsibilities, titles or offices as in effect immediately prior to
a Change-in-Control, or any removal of the Employee from or any failure to re-elect
the Employee to any of such positions, except in connection with the termination of
the Employee’s employment due to Cause (as hereinafter defined) or as a result of
the Employee’s death;
	 
	 	 	 	(ii) a material reduction by Kennametal in the Employee’s base salary as in effect
immediately prior to a Change-in-Control;
	 
	 	 	 	(iii) a failure by Kennametal to continue to provide incentive compensation, under
the rules by which incentives are provided, on a basis not materially less
favorable to that provided by Kennametal immediately prior to a
Change-in-Control;
	 
	 	 	 	(iv) a material reduction in the overall level of employee benefits, including any
benefit or compensation plan, stock option plan, retirement plan, life insurance
plan, health and accident plan or disability plan in which Employee is actively
participating immediately prior to a Change-in-Control (provided, however, that
there shall not be deemed to be any such failure if Kennametal substitutes for the
discontinued plan, a plan providing Employee with substantially similar benefits) or
the taking of any action by Kennametal which would adversely affect Employee’s
participation in or materially reduce Employee’s overall level of benefits under
such plans or deprive Employee of any material fringe benefits enjoyed by Employee
immediately prior to a Change-in-Control;
	 
	 	 	 	(v) the breach of this Agreement caused by the failure of Kennametal to obtain the
assumption of this Agreement by any successor as contemplated in Section 11 hereof;
and
	 
	 	 	 	(vi) the relocation of the Employee to a facility or a location more than 50 miles
from the Employee’s then present location, without the Employee’s prior written
consent.

- 6 -

 

     Notwithstanding the forgoing, in order for the Employee to terminate for Good Reason:
(a) the Employee must give written notice to Kennametal of the Employee’s intention to
terminate employment for Good Reason within sixty (60) days after the event or omission
which constitutes Good Reason, and any failure to give such written notice within such
period will result in a waiver by the Employee of his right to terminate for Good Reason as
a result of such act or omission, (b) the event must remain uncorrected by Kennametal for
thirty (30) days following such notice (the “Notice Period”), and (C) such termination must
occur within sixty (60) days after the expiration of the Notice Period.

5. In the event that Employee (a) shall be guilty of malfeasance, willful misconduct or gross
negligence in the performance of the services contemplated by this Agreement, or (b) shall not make
his services available to Kennametal on a full time basis in accordance with Section 1 hereof for
any reason (including Disability (as hereinafter defined)) other than arising from Employee’s
incapacity due to physical or mental illness or injury which does not constitute Disability (as
hereinafter defined) and other than by reason of the fact Employee’s employment has been terminated
under the circumstances described in Section 4(a), or (c) shall breach the provisions of Section 8
hereof (the matters described in items (a), (b) and (c) above are collectively referred to as
“Cause”), Kennametal shall have the right, exercised by resolution adopted by a majority of its
Board of Directors, to terminate Employee’s employment for Cause by giving prior written notice to
Employee of its election so to do. In that event, Employee’s employment shall be deemed terminated
for Cause, Employee shall not be entitled to the benefits set forth in Section 4 which shall not be
paid or payable and Kennametal shall only have the obligation to pay Employee the unpaid portion of
Employee’s base salary for the period from the last period from which Employee was paid to the Date
of Termination; provided, however, that if Employee’s employment is terminated as a result of the
Employee’s Disability, the benefits set forth in Section 4 shall not be paid or payable but
Employee shall be entitled to receive all benefits to which Employee is entitled under Kennametal’s
plans then in effect as a result of Employee’s Disability. For purposes of this Agreement
“Disability” shall mean such incapacity due to physical or mental illness or injury which results
in the Employee’s being absent from his principal office at Kennametal’s offices for the entire
portion of 180 consecutive business days. Prior to a Change-in-Control, a decision by the Board of
Directors of Kennametal that “Cause” exists shall be in the discretion of the Board of Directors
and shall be final and binding upon the Employee and his rights hereunder. After a
Change-in-Control, “Cause” shall not be deemed to include opposition by Employee to such a
Change-in-Control or any matter incidental thereto and any determination by the Board of Directors
that “Cause” existed shall not be final or binding upon the Employee or his rights hereunder or
entitled to any deference in any court or other tribunal.

6. Employee understands and agrees that, except to the extent Employee is entitled to the benefits
provided in Section 4(c) hereof, in the event Employee resigns or his employment is terminated for
any reason other than death or Disability prior to his “Retirement Date” (as hereinafter defined),
he will forfeit any interest he may have in any Kennametal retirement plan (except to the extent
vested by actual service to date of separation as per the plan provisions), and all other benefits
dependent upon
continuing service. The term “Retirement Date” shall mean the first day of the month following the

- 7 -

 

day on which Employee attains his sixty-fifth birthday, or at Employee’s request, any other day
that Kennametal’s Board of Directors may approve in writing.

7. Nothing herein contained shall affect the right of Employee to participate in and receive
benefits under and in accordance with the then current provisions of any employee benefit plan,
program or arrangement of Kennametal and all payments hereunder shall be in addition to any
benefits received thereunder (including long term disability payments).

8. Non-Competition Agreement. During the period of employment of Employee by Kennametal and for
three years thereafter Employee will not, in any geographic area in which Kennametal is offering
its services and products, without the prior written consent of Kennametal:

	 	 	(a) directly or indirectly engage in, or
	 
	 	 	(b) assist or have an active interest in (whether as proprietor, partner, investor,
shareholder, officer, director or any type of principal whatsoever), or
	 
	 	 	(c) enter the employ of, or act as agent for, or advisor or consultant to
	 
	 	 	any person, firm, partnership, association, corporation or business organization, entity or
enterprise which is or is about to become directly or indirectly engaged in, any business
which is competitive with any business of Kennametal or any subsidiary or affiliate thereof
in which Employee is or was engaged; provided, however, that the foregoing provisions of
this Section 8 are not intended to prohibit and shall not prohibit Employee from purchasing,
for investment, not in excess of 1% of any class of stock or other corporate security of any
company which is registered pursuant to Section 12 of the Securities Exchange Act of 1934.

     Non-Solicitation Agreement. During the period of employment of Employee by Kennametal and for
one year thereafter, Employee will not, without the prior written consent of Kennametal (i) solicit
or attempt to hire or assist any other person in any solicitation or attempt to hire any employee
of Kennametal, its subsidiaries or affiliates, or (ii) encourage any such employee to terminate
his/her employment with Kennametal, its subsidiaries or affiliates.

     Employee acknowledges that the breach by him of the provisions of this Section 8 would cause
irreparable injury to Kennametal, acknowledges and agrees that remedies at law for any such breach
will be inadequate and consents and agrees that Kennametal shall be entitled, without the necessity
of proof of actual damage, to injunctive relief in any proceedings which may be brought to enforce
the provisions of this Section 8. Employee specifically agrees that the limitations as to periods
of time and geographic area, as well as all other restrictions on his activities specified in
Section 8, are reasonable and necessary for the protection of Kennametal, its employees and its
affiliates. Employee acknowledges and warrants that he will be fully
able to earn an adequate livelihood for himself and his dependents if this Section 8 should be

- 8 -

 

specifically enforced against him and that such enforcement will not impair his ability to obtain
employment commensurate with his abilities and fully acceptable to him.

     The provisions of this Section 8 shall not apply to the Employee following a termination of
Employee’s employment (x) if a Change-in-Control shall have occurred prior to the Date of
Termination, or (y) if Employee’s employment is terminated by Kennametal other than for Cause.

     If the scope of any restriction contained in this Section 8 is too broad to permit enforcement
of such restriction to its full extent, then such restriction shall be enforced to the maximum
extent permitted by law and Employee and Kennametal hereby consent and agree that such scope may be
judicially modified in any proceeding brought to enforce such restriction.

	9.	 	(a) Employee acknowledges and agrees that in the course of his employment by Kennametal,
Employee may work with, add to, create or acquire trade secrets and confidential information
(“Confidential Information”) which could include, in whole or in part, information:

	 	 	 	(i) of a technical nature such as, but not limited to, Kennametal’s manuals,
methods, know-how, formulae, shapes, designs, compositions, processes, applications,
ideas, improvements, discoveries, inventions, research and development projects,
equipment, apparatus, appliances, computer programs, software, systems
documentation, special hardware, software development and similar items; or
	 
	 	 	 	(ii) of a business nature such as, but not limited to, information about business
plans, sources of supply, cost, purchasing, profits, markets, sales, sales volume,
sales methods, sales proposals, identity of customers and prospective customers,
identity of customers’ key purchasing personnel, amount or kind of customers’
purchases and other information about customers; or
	 
	 	 	 	(iii) pertaining to future developments such as, but not limited to, research and
development or future marketing or merchandising.

     Employee further acknowledges and agrees that (i) all Confidential Information is the
property of Kennametal; (ii) the unauthorized use, misappropriation or disclosure of any
Confidential Information would constitute a breach of trust and could cause irreparable
injury to Kennametal; and (iii) it is essential to the protection of Kennametal’s goodwill
and to the maintenance of its competitive position that all Confidential Information be kept
secret and that Employee not disclose any Confidential Information to others or use any
Confidential Information to the detriment of Kennametal.

     Employee agrees to hold and safeguard all Confidential Information in trust for
Kennametal, its successors and assigns and Employee shall not (except

- 9 -

 

as required in the
performance of Employee’s duties), use or disclose or make available to anyone for use
outside Kennametal’s organization at any time,
either during employment with Kennametal or subsequent thereto, any of the Confidential
Information, whether or not developed by Employee, without the prior written consent of
Kennametal.

	 	(b)	 	Employee agrees that:
	 
	 	 	 	(i) he will promptly and fully disclose to Kennametal or such officer or other agent
as may be designated by Kennametal any and all inventions made or conceived by
Employee (whether made solely by Employee or jointly with others) during employment
with Kennametal (1) which are along the line of the business, work or investigations
of Kennametal, or (2) which result from or are suggested by any work which Employee
may do for or on behalf of Kennametal; and
	 
	 	 	 	(ii) he will assist Kennametal and its nominees during and subsequent to such
employment in every proper way (entirely at its or their expense) to obtain for its
or their own benefit patents for such inventions in any and all countries; the said
inventions, without further consideration other than such salary as from time to
time may be paid to him by Kennametal as compensation for his services in any
capacity, shall be and remain the sole and exclusive property of Kennametal or its
nominee whether patented or not; and
	 
	 	 	 	(iii) he will keep and maintain adequate and current written records of all such
inventions, in the form of but not necessarily limited to notes, sketches, drawings,
or reports relating thereto, which records shall be and remain the property of and
available to Kennametal at all times.

	 	 	(c) Employee agrees that, promptly upon termination of his employment, he will disclose to
Kennametal, or to such officer or other agent as may be designated by Kennametal, all
inventions which have been partly or wholly conceived, invented or developed by him for
which applications for patents have not been made and shall thereafter execute all such
instruments of the character hereinbefore referred to, and will take such steps as may be
necessary to secure and assign to Kennametal the exclusive rights in and to such inventions
and any patents that may be issued thereon any expense therefor to be borne by Kennametal.
	 
	 	 	(d) Employee agrees that he will not at any time aid in attacking the patentability, scope,
or validity of any invention to which the provisions of subsections (b) and (c), above,
apply.

10. In the event that (a) Employee institutes any legal action to enforce his rights under, or to
recover damages for breach of this Agreement, or (b) Kennametal institutes
any action to avoid making any payments due to Employee under this Agreement, Employee, if he is
the prevailing party, shall be entitled to recover from Kennametal any

- 10 -

 

actual expenses for
attorney’s fees and other disbursements incurred by him in relation thereto.

11. The terms and provisions of this Agreement shall be binding upon, and shall inure to the
benefit of, Employee and Kennametal, it subsidiaries and affiliates and their respective successors
and assigns.

12. This agreement constitutes the entire agreement between the parties hereto and supersedes all
prior agreements and understandings, whether oral or written, among the parties with respect to the
subject matter hereof. This agreement may not be amended orally, but only by an instrument in
writing signed by each of the parties to this Agreement; provided, however, the Corporation may,
solely to the extent necessary to comply with Section 409A, modify the terms of this Agreement if
it is determined that such terms would subject any payments or benefits hereunder to the additional
tax and/or interest assessed under Section 409A. References to sections of statutes, including the
Code, contained herein shall mean and include such provisions that succeed such sections to the
extent that such successor provisions provide the results intended by the parties under this
Agreement.

13. The invalidity or unenforceability of any provision of this Agreement shall not affect the
other provisions hereof, and this Agreement shall be construed in all respects as if such invalid
or unenforceable provision were omitted.

14. Any pronoun and any variation thereof used in this Agreement shall be deemed to refer to the
masculine, feminine, neuter, singular or plural, as the identity of the parties hereto may require.

15. Kennametal shall be entitled as a condition to paying any severance pay or providing any
benefits hereunder upon a termination of the Employee’s employment to require the Employee to
deliver on or before the making of any severance payment or providing of any benefit a release in
the form of Exhibit A attached hereto. Unless otherwise required by applicable law, the
release must be executed and become effective and irrevocable within thirty (30) days of the
Employee’s Date of Termination.

16. (a) For purposes of this Section 16:

          (i) “Accounting Firm” means the accounting firm of national recognized standing selected by
the Corporation promptly upon a Change-of-Control;

          (ii) “Agreement Payment” shall mean a Payment paid or payable pursuant to this Agreement
(disregarding this Section 16);

          (iii) “Net After Tax Receipts” shall mean the Present Value of a Payment net of all taxes
imposed on the Employee with respect thereto under Sections 1 and 4999 of the Code determined by
applying the highest marginal rate under Section 1 of the Code applicable to the Employee’s taxable
income for such year;

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          (iv) a “Payment” shall mean any payment or distribution by the Corporation or its subsidiaries
and affiliates in the nature of compensation to or for the benefit of the Employee, whether paid or
payable pursuant to this Agreement or otherwise;

          (v) “Present Value” shall mean such value determined in accordance with Section 280G(d)(4) of
the Code; and

          (vi) “Reduced Amount” shall mean the greatest aggregate amount of Payments, if any, which (x)
is less than the sum of all Payments and (y) results in aggregate Net After Tax Receipts which are
greater than the Net After Tax Receipts which would result if the aggregate Payments were made.

     (b) Anything in this Agreement to the contrary notwithstanding, in the event that the
Accounting Firm shall determine that receipt of all Payments would subject the Employee to tax
under Section 4999 of the Code, it shall determine whether some amount of Payments would meet the
definition of a “Reduced Amount.” If the Accounting Firm determines that there is a Reduced Amount,
the aggregate Agreement Payments shall be reduced to such Reduced Amount; provided, however, that
if the Reduced Amount exceeds the aggregate Agreement Payments, the aggregate Payments shall, after
the reduction of all Agreement Payments, be reduced (but not below zero) in the amount of such
excess. The total reduction to the Agreement Payments and such other Payments required under this
Section 16 necessary to achieve the “Reduced Amount” shall be made against Agreement Payments and
such other Payments that are exempt or otherwise excepted from Section 409A (but excluding stock
options and other stock rights). All determinations to be made by the Accounting Firm under this
Section 16 shall be binding upon the Corporation and the Employee and shall be made within five (5)
days of a Change-of-Control and, in addition, the subsequent occurrence of any event that requires
the Corporation to make payments to the Employee under Section 4(c) this Agreement. No later than
two (2) business days following the making of any such determination by the Accounting Firm, the
Corporation shall pay to or distribute for the benefit of the Employee such Payments when and as
due to the Employee under this Agreement or any other agreement. The Corporation or its successor
shall be responsible for the fees, costs and expenses of the Accounting Firm.

     (c) While it is the intention of the Corporation and the Employee to reduce the amounts
payable or distributable to the Employee hereunder only if the aggregate Net After Tax Receipts to
the Employee would thereby be increased, as a result of the uncertainty in the application of
Section 4999 of the Code at the time of the initial determination by the Accounting Firm hereunder,
it is possible that amounts will have been paid or distributed by the Corporation to or for the
benefit of the Employee pursuant to this Agreement which should not have been so paid or
distributed (“Overpayments”) or that additional amounts which will not have been paid or
distributed by the Corporation to or for the benefit of the Employee pursuant to this Agreement
could have been so paid or distributed (an “Underpayment”), in each case, consistent with the
calculation of the Reduced Amount hereunder. In the event that the
Accounting Firm, based either upon the assertion of a deficiency by the Internal Revenue Service

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against the Corporation or the Employee which the Accounting Firm believes has a high probability
of success or controlling precedent or other substantial authority, determines that an Overpayment
has been made, any such Overpayment paid or distributed by the Corporation to or for the benefit of
the Employee shall be treated for all purposes as a loan ab initio to the Employee which the
Employee shall repay to the Corporation together with interest at the applicable federal rate
provided for in Section 7872(f)(2) of the Code; provided, however, that no such loan shall be
deemed to have been made and no amount shall be payable by the Employee to the Corporation if and
to the extent such deemed loan and payment would not either reduce the amount on which the Employee
is subject to tax under Section 1 and Section 4999 of the Code or generate a refund of such taxes.
In the event that the Accounting Firm, based upon controlling precedent or other substantial
authority, makes a final determination that an Underpayment has occurred, any such Underpayment
shall be promptly paid by the Corporation to or for the benefit of the Employee together with
interest at the applicable federal rate provided for in Section 7872(f)(2) of the Code.

	17.	 	(a) The provisions of this Agreement will be administered, interpreted and construed in a
manner intended to comply with Section 409A, or any exception thereto (or disregarded to the
extent such provision cannot be so administered, interpreted, or construed).
	 
	 	 	(b) For purposes of Section 409A, each severance payment, including each individual
installment payment, shall be treated as a separate payment. Each payment under this
Agreement is intended to be excepted from Section 409A to the maximum extent provided under
Section 409A as follows: (i) each payment made within the applicable 21/2 month period
specified in Treas. Reg. § 1.409A-1(b)(4) is intended to be excepted under the short-term
deferral exception as specified in Treas. Reg. § 1.409A-1(b)(4); (ii) post-termination
medical benefits are intended to be excepted under the medical benefits exceptions as
specified in Treas. Reg. § 1.409A-1(b)(9)(v)(B); and (iii) to the extent payments are made
as a result of an involuntary separation, each payment that is not otherwise excepted under
the short-term deferral exception or medical benefits exception is intended to be excepted
under the involuntary pay exception as specified in Treas. Reg. § 1.409A-1(b)(9)(iii).
	 
	 	 	(c) With respect to payments subject to Section 409A (and not excepted therefrom), if any,
it is intended that each payment is paid on a permissible distribution event and at a
specified time consistent with Section 409A. The Corporation reserves the right to
accelerate and/or defer any payment to the extent permitted and consistent with Section
409A. Notwithstanding any provision of this Agreement to the contrary, to the extent that a
payment hereunder is subject to Section 409A (and not excepted therefrom) and payable on
account of a termination of employment, such payment shall be delayed for a period of six
months after the date of termination (or, if earlier, the date of the Employee’s death) if
the Employee is a “specified employee” (as defined in Section 409A and determined in
accordance with the procedures established by
the Corporation). Any payment that would otherwise have been due or owing during such
6-month period will be paid on the first business day of the seventh

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	 	 	month following the
Employee’s date of termination (or, if earlier, the date of the Employee’s death). The
Employee shall have no right to designate the date of any payment under this Agreement.
Notwithstanding any provision of this Agreement to the contrary, Employee acknowledges and
agrees that the Corporation shall not be liable for, and nothing provided or contained in
this Agreement will be construed to obligate or cause the Corporation to be liable for, any
tax, interest or penalties imposed on Employee related to or arising with respect to any
violation of Section 409A.

18. This agreement shall be governed by the laws of the Commonwealth of Pennsylvania.

     WITNESS the due execution hereto as of the day and year first above written.

	 	 	 	 	 
	 	KENNAMETAL INC.

 	 
	 	By:  	 	 
	 	 	[Name]	 
	 	 	[Title]
	 
	 
	 	Employee:

 	 
	 	
 	 
	 	[Officer’s Name] 	 
	 	 	 

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Exhibit A

FORM OF RELEASE

[to be updated at the time of execution

in accordance with then existing law]

TO: [Officer’s Name]

DATE: [Date]

     For good and valuable consideration, the receipt of which is hereby acknowledged, and
intending to be legally bound, you hereby release, remise, quitclaim and discharge completely and
forever Kennametal Inc. and its directors, officers, employees, subsidiaries and affiliates
(collectively, the “Company”) from any and all claims, causes of action or rights which you have or
may have, whether arising by virtue of contract or of applicable state laws or federal laws, and
whether such claims, causes of action or lights are known or unknown, including but not limited to
claims relating in any way to compensation and benefits and related to or resulting from your
employment with the Company or its termination, claims arising under any public policy or any
statutory, tort or common law, or any provision of state, federal or local law including, but not
limited to, the Pennsylvania Human Relations Act, the Americans with Disabilities Act, Title VII of
the Civil Rights Act of 1964, the Civil Rights Act of 1991, Sections 1981-1988 of Title 42 of the
U. S. Code, Older Workers’ Benefit Protection Act, Family and Medical Leave Act, the Fair Labor
Standards Act, Pennsylvania Wage Payment and Collection laws, the Age Discrimination in Employment
Act of 1967, the Employee Retirement Income Security Act of 1974, all as amended; provided,
however, that this Release shall not release, raise, quitclaim or discharge any claims, causes of
action or rights which you may have: (i) under that certain Officer’s Employment Agreement dated
as of [___________] between the undersigned and Kennametal Inc. (the “Employment Agreement”); (ii)
to any unreimbursed expense account or similar out-of-pocket reimbursement amounts owing the
undersigned; or (iii) under the bylaws or any agreement of Kennametal Inc. or any subsidiary
thereof applicable to you or the applicable state corporate statutes to indemnification for having
served as an officer, director and/or employee of Kennametal Inc. and/or its subsidiaries or as a
fiduciary of any employee benefit plan applicable to former employees generally.

     You must agree to immediately return all of the Company’s equipment, documents and property,
agree to forever waive your right to receive on your or any other person’s behalf any monies,
benefits, or damages from the Company other than those provided herein or in the Employment
Agreement. You must also agree to maintain the confidentiality of this Release and not reveal the
terms set forth herein to anyone other than your accountant, attorney or spouse.

     By signing below, you acknowledge your continuing obligations under the Employment Agreement
including, but not limited to, Sections 8 through 10 thereof.

     Your failure to abide by any of the above stated obligations will result in irreparable harm
to the Company and entitle the Company to require you to specifically perform your obligations
under this Release, recover any damages that may flow from this

 

 

agreement and obtain appropriate injunctive relief. Should you file a claim or charge
against the Company, you agree that the Company may present this agreement for purposes of having
your claim or charge dismissed.

     Any severance payments due to you under the Employment Agreement are conditioned on your
execution and non-revocation of this Release.

     You should carefully consider the matters outlined in this letter. If, after due deliberation
and consultation with lawyers or such professional advisors as you deem appropriate, the above is
agreeable to you, please sign the attached copy of this letter and return the original to the
Company for my files. Please retain a copy for your own records.

     You may take up to twenty-one (21) days to consider this Release. Should you accept this
severance offer by signing your name below, you will then have seven (7) days to reconsider your
decision. If you choose to revoke your acceptance of this offer you must do so by writing to the
Company within the seven (7) day revocation period. No severance payments will be made to you
until the seven (7) day revocation period has expired.

	 	 	 	 	 	 	 	 	 

	 

	 	 	 	 	 	AGREED TO AND ACCEPTED BY

	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 

[Officer’s Name]
	 	 
	 
	 	 	 	 	 	 	 	 
	Dated:
	 	 	 	 	 	 	 	 
	 

	 	 

	 	 	 	 	 	 

- 2 -

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