Document:

STOCK PURCHASE AGREEMENT, MEASUREMENT SPECIALITIES INC AND PRESSURE SYSTEMS

 Exhibit 10.37 

 
 STOCK PURCHASE AGREEMENT 

by and between 
 MEASUREMENT SPECIALTIES, INC, 
 PRESSURE SYSTEMS, INC. 

and 

ESTERLINE TECHNOLOGIES CORPORATION 
 Dated September 8, 2010 

 TABLE OF CONTENTS 

 

									
	 	 	 	 	 	  	Page	 
			
	 1.
	 	Definitions and Usage	  	 	1	  
		 	 1.1.
	 	Definitions	  	 	1	  
		 	 1.2.
	 	Usage	  	 	10	  
	 2.
	 	Sale and Transfer of Shares; Closing	  	 	11	  
		 	 2.1.
	 	Sale of Shares	  	 	11	  
		 	 2.2.
	 	Consideration	  	 	11	  
		 	 2.3.
	 	Closing	  	 	11	  
		 	 2.4.
	 	Closing Obligations	  	 	11	  
		 	 2.5.
	 	Adjustment Amount and Payment	  	 	12	  
		 	 2.6.
	 	Adjustment Procedure	  	 	13	  
	 3.
	 	Representations and Warranties of Shareholder and Company	  	 	14	  
		 	 3.1.
	 	Organization and Good Standing	  	 	14	  
		 	 3.2.
	 	Enforceability; Authority; No Conflict	  	 	14	  
		 	 3.3.
	 	Capitalization	  	 	15	  
		 	 3.4.
	 	Financial Statements	  	 	15	  
		 	 3.5.
	 	Books and Records	  	 	16	  
		 	 3.6.
	 	Description of Real Property	  	 	16	  
		 	 3.7.
	 	Leased Real Property	  	 	16	  
		 	 3.8.
	 	Real Property; Encumbrances	  	 	16	  
		 	 3.9.
	 	Condition of Facilities; Assets	  	 	17	  
		 	 3.10.
	 	Accounts Receivable	  	 	17	  
		 	 3.11.
	 	Inventories	  	 	17	  
		 	 3.12.
	 	Taxes	  	 	18	  
		 	 3.13.
	 	Employee Plans	  	 	20	  
		 	 3.14.
	 	Compliance with Legal Requirements; Governmental Authorizations	  	 	21	  
		 	 3.15.
	 	Legal Proceedings; Orders	  	 	22	  
		 	 3.16.
	 	Absence of Certain Changes and Events	  	 	23	  
		 	 3.17.
	 	Contracts; No Defaults	  	 	23	  
		 	 3.18.
	 	Insurance	  	 	25	  
		 	 3.19.
	 	Environmental Matters	  	 	26	  
		 	 3.20.
	 	Employees	  	 	27	  
		 	 3.21.
	 	Labor Disputes; Compliance	  	 	28	  
		 	 3.22.
	 	Intellectual Property Assets	  	 	28	  
		 	 3.23.
	 	Brokers or Finders	  	 	29	  
		 	 3.24.
	 	Affiliate Transactions	  	 	29	  
		 	 3.25.
	 	Export Compliance	  	 	29	  
		 	 3.26.
	 	Sufficiency of Assets; Operations of Business	  	 	30	  
		 	 3.27.
	 	Customers and Suppliers	  	 	30	  
		 	 3.28.
	 	Absence of Sensitive Payments	  	 	30	  
	 4.
	 	Representations and Warranties of Buyer	  	 	31	  
		 	 4.1.
	 	Organization and Good Standing	  	 	31	  
		 	 4.2.
	 	Enforceability; Authority; No Conflict	  	 	31	  
		 	 4.3.
	 	Certain Proceedings	  	 	31	  

  
 ii 

									
		 	4.4.	 	Brokers or Finders	  	 	32	  
		 	4.5.	 	Financing	  	 	32	  
		 	4.6.	 	Operations of Business	  	 	32	  
	 5.
	 	Intentionally Omitted	  	 	32	  
	 6.
	 	Intentionally Omitted	  	 	32	  
	 7.
	 	Intentionally Omitted	  	 	32	  
	 8.
	 	Intentionally Omitted	  	 	32	  
	 9.
	 	Intentionally Omitted	  	 	32	  
	 10.
	 	Additional Covenants	  	 	32	  
		 	10.1.	 	Nonsolicitation of Employees	  	 	32	  
		 	10.2.	 	Noncompetition	  	 	32	  
		 	10.3.	 	Further Assurances	  	 	33	  
		 	10.4.	 	Tax Matters	  	 	34	  
		 	10.5.	 	Pre-Closing Distributions	  	 	38	  
		 	10.6.	 	Employees and Benefits	  	 	39	  
		 	10.7.	 	Pre-Closing Expenses	  	 	40	  
		 	10.8.	 	ASML Last Buy Agreement	  	 	41	  
		 	10.9.	 	Post-Closing Financial Reporting	  	 	41	  
		 	10.10.	 	Post-Closing Employee Benefits	  	 	41	  
		 	10.11.	 	Post-Closing Use of Shareholder Name and Logo	  	 	41	  
		 	10.12.	 	Post-Closing Internet Content	  	 	41	  
	 11.
	 	Indemnification; Remedies	  	 	42	  
		 	11.1.	 	Survival	  	 	42	  
		 	11.2.	 	Indemnification and Reimbursement By Shareholder	  	 	42	  
		 	11.3.	 	Indemnification and Reimbursement By Buyer	  	 	43	  
		 	11.4.	 	Limitations on Amount—Shareholder	  	 	43	  
		 	11.5.	 	Limitations on Amount--Buyer	  	 	44	  
		 	11.6.	 	Time Limitations	  	 	44	  
		 	11.7.	 	Third-Party Claims	  	 	44	  
		 	11.8.	 	Other Claims	  	 	46	  
		 	11.9.	 	Losses Net of Insurance, Etc	  	 	46	  
	 12.
	 	Confidentiality	  	 	47	  
	 13.
	 	General Provisions	  	 	47	  
		 	13.1.	 	Expenses	  	 	47	  
		 	13.2.	 	Public Announcements	  	 	48	  
		 	13.3.	 	Notices	  	 	48	  
		 	13.4.	 	Jurisdiction; Service of Process; Mediation; Waiver of Jury Trial	  	 	49	  
		 	13.5.	 	Waiver; Remedies Cumulative	  	 	50	  
		 	13.6.	 	Entire Agreement and Modification	  	 	50	  
		 	13.7.	 	Assignments, Successors and No Third-Party Rights	  	 	50	  
		 	13.8.	 	Severability	  	 	50	  
		 	13.9.	 	Construction	  	 	50	  
		 	13.10.	 	Time of Essence	  	 	51	  
		 	13.11.	 	Governing Law	  	 	51	  
		 	13.12.	 	Execution of Agreement	  	 	51	  

  
 iii

 STOCK PURCHASE AGREEMENT 

This Stock Purchase Agreement (“Agreement”) is dated September 8, 2010, by and between Measurement
Specialties, Inc., a New Jersey corporation (“Buyer”), Pressure Systems, Inc., a Virginia corporation (“Company”) and Esterline Technologies Corporation, a Delaware corporation (“Shareholder”). 

RECITALS 
 Shareholder owns one hundred percent (100%) of the issued and outstanding shares of capital stock (the “Shares”) of Company. Shareholder desires to sell, and Buyer desires to purchase, the
Shares for the consideration and on the terms set forth in this Agreement. 
 The parties, intending to be legally bound, agree
as follows: 
  

	1.	Definitions and Usage 

  

	 	1.1.	Definitions 

 For purposes of this Agreement, the following terms and variations thereof have the meanings specified or referred to in this Section 1.1: 

“Accounts Receivable”--(a) all trade accounts receivable and other rights to payment from customers of Company
and the full benefit of all security for such accounts or rights to payment, including all trade accounts receivable representing amounts receivable in respect of goods shipped or products sold or services rendered to customers of Company,
(b) all other accounts or notes receivable of Company and the full benefit of all security for such accounts or notes and (c) any claim, remedy or other right related to any of the foregoing. 

“Adjustment Amount”--as defined in Section 2.5. 

“Appurtenances”--all privileges, rights, easements, hereditaments and appurtenances belonging to or for the
benefit of the Land, including all easements appurtenant to and for the benefit of any Land (a “Dominant Parcel”) for, and as the primary means of access between, the Dominant Parcel and a public way, or for any other use upon which lawful
use of the Dominant Parcel for the purposes for which it is presently being used is dependent, and all rights existing in and to any streets, alleys, passages and other rights-of-way included thereon or adjacent thereto (before or after vacation
thereof) and vaults beneath any such streets. 
 “ASML” --ASML Netherlands B.V. 

“ASML Business”--the current business of the Company related solely to pressure measurement sensors and systems
for exclusive use in microlithography technologies or its applications which sensors and systems are currently sold by the Company solely to ASML. 
 “ASML Business Transfer” –as defined in Section 10.5. 
 “ASML Last Buy Agreement”--as defined in Section 2.4(a)(x). 

  
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 “ASML License Agreement”--as defined in Section 2.4(a)(x).

 “Balance Sheet”--as defined in Section 3.4. 

“Breach”--any breach of, or any inaccuracy in, any representation or warranty or any breach of, or failure to
perform or comply with, any covenant or obligation, in or of this Agreement or any other Contract, or any event which with the passing of time or the giving of notice, or both, would constitute such a breach, inaccuracy or failure. 

“Business Day”--any day other than (a) Saturday or Sunday or (b) any other day on which banks in
Seattle, Washington are permitted or required to be closed. 
 “Buyer”--as defined in the first
paragraph of this Agreement. 
 “Buyer Indemnified Persons”--as defined in Section 11.2.

 “Closing”--as defined in Section 2.4. 

“Closing Date”--the date on which the Closing actually takes place. 

“Closing Financial Statements”--as defined in Section 2.6(b). 

“Closing Working Capital”--as defined in Section 2.6(b). 

“COBRA”--as defined in Section 3.15(d). 

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

“Company Contract”--any Contract (a) under which Company has or may acquire any rights or benefits;
(b) under which Company has or may become subject to any obligation or liability; or (c) by which Company or any of the assets owned or used by Company is or may become bound. 

“Confidential Information”--as defined in Section 12.1. 

“Consent”--any approval, consent, ratification, waiver or other authorization. 

“Contemplated Transactions”--all of the transactions contemplated by this Agreement. 

“Contract”--any agreement, contract, Lease, consensual obligation, promise or undertaking (whether written or
oral and whether express or implied), whether or not legally binding. 
 “Copyrights”--as defined in
Section 3.22(a)(iii). 
 “Damages”--as defined in Section 11.2. 

“Disclosure Schedules”--the disclosure schedules delivered by Company and Shareholder to Buyer concurrently
with the execution and delivery of this Agreement. 

  
 2 

 “Embargoed Person” means any person, country or entity subject to
trade restrictions under United States law, including, without limitation, the International Emergency Economic Powers Act, 50 U.S.C. §§ 1701, et seq., the Trading with the Enemy Act, 50 U.S.C. §§ App.1, et seq., the Export
Administration Act, 50 U.S.C. app. §§ 2401-2420, the Arms Export Control Act, 22 U.S.C. §§ 2751-2794, or any statutes, regulations or Executive Orders implemented by the U.S. Treasury Department’s Office of Foreign Assets
Control (“OFAC”), the U.S. Commerce Department’s Bureau of Industry and Security (“BIS”) or the United States Department of State Directorate of Defense Trade Controls (“DDTC”). 

“Effective Time”—11:59 p.m. Eastern Standard Time on the Closing Date. 

“Employee Plans”--as defined in Section 3.13(a). 

“Encumbrance”--any charge, claim, community or other marital property interest, condition, equitable interest,
lien, option, pledge, security interest, mortgage, right of way, easement, encroachment, servitude, right of first option, right of first refusal or similar restriction, including any restriction on use, voting (in the case of any security or equity
interest), transfer, receipt of income or exercise of any other attribute of ownership. 

“Environment”--soil, land surface or subsurface strata, surface waters (including navigable waters and ocean
waters), groundwaters, drinking water supply, stream sediments, ambient air (including indoor air), plant and animal life and any other environmental medium or natural resource. 

“Environmental, Health and Safety Liabilities”--any cost, damages, expense, Liability, obligation or other
responsibility arising from or under any Environmental Law or Occupational Safety and Health Law, including those consisting of or relating to: 
 (a)      any environmental, health or safety matter or condition (including on-site or off-site contamination, occupational safety and health and regulation of any chemical
substance or product); 
 (b)      any fine, penalty, judgment, award, settlement,
legal or administrative proceeding, damages, loss, claim, demand or response, remedial or inspection cost or expense or obligation arising under any Environmental Law or Occupational Safety and Health Law; 

(c)      financial or other responsibility under any Environmental Law or Occupational
Safety and Health Law for cleanup costs or corrective action, including any investigation, cleanup, removal, containment or other remediation or response actions (“Cleanup”) required by any Environmental Law or Occupational Safety and
Health Law (whether or not such Cleanup has been required or requested by any Governmental Body or any other Person) and for any natural resource damages; or 
 (d)      any other compliance, corrective or remedial measure required under any Environmental Law or Occupational Safety and Health Law. 

  
 3 

 The terms “removal,” “remedial” and “response
action” include the types of activities covered by the United States Comprehensive Environmental Response, Compensation and Liability Act of 1980 (CERCLA). 

“Environmental Law”--any Legal Requirement that pertains to the regulation, protection, preservation or
remediation of the Environment, health, safety or Hazardous Materials, including Legal Requirements that require or relate to: 
 (a)      advising appropriate authorities, employees or the public of intended or actual Releases of Hazardous Materials, violations of discharge limits or other prohibitions
under Environmental Law and the commencement of activities, such as resource extraction or construction, that could have significant impact on the Environment; 
 (b)      preventing or reducing to acceptable levels the Release of Hazardous Materials into the Environment; 

(c)      reducing the quantities, preventing the Release or minimizing the hazardous
characteristics of wastes that are generated; 
 (d)      assuring that products
are designed, formulated, packaged and used so that they do not present unreasonable risks to human health or the Environment when used or disposed of; 
 (e)      protecting natural resources, species or ecological amenities; 
 (f)      reducing to acceptable levels the risks inherent in the transportation of Hazardous Materials; 

(g)      cleaning up Hazardous Materials that have been Released, preventing the threat of
Release or paying the costs of such clean up or prevention; or 
 (h)      making
responsible parties pay Governmental Bodies, private parties, or groups of them, for damages done to health or the Environment or permitting self-appointed representatives of the public interest to recover for injuries done to public assets.

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

“ERISA AFFILIATE”--any trade or business that, together with the Company, is treated as a single employer under
Section 414(b), (c) or (m) of the Code. 
 “Exchange Act”--the Securities Exchange Act
of 1934. 
 “Facilities”--any real property, leasehold or other interest in real property currently
owned or operated by Company, including the Tangible Personal Property used or operated by Company at the location of the Real Property specified in Section 3.6. 

“GAAP”--generally accepted accounting principles for financial reporting in the United States, applied on a
basis consistent with the basis on which the Balance Sheet and the other financial statements referred to in Section 3.4 were prepared. 

  
 4 

 “Governing Documents”--with respect to any particular entity,
(a) if a corporation, the articles or certificate of incorporation and the bylaws; (b) if a general partnership, the partnership agreement and any statement of partnership; (c) if a limited partnership, the limited partnership
agreement and the certificate of limited partnership; (d) if a limited liability company, the articles of organization and operating agreement; (e) if another type of Person, any other charter or similar document adopted or filed in
connection with the creation, formation or organization of the Person; (f) all equityholders’ agreements, voting agreements, voting trust agreements, joint venture agreements, registration rights agreements or other agreements or documents
relating to the organization, management or operation of any Person or relating to the rights, duties and obligations of the equityholders of any Person; and (g) any amendment or supplement to any of the foregoing. 

“Governmental Authorization”--any Consent, license, registration or permit issued, granted, given or otherwise
made available by or under the authority of any Governmental Body or pursuant to any Legal Requirement. 

“Governmental Body”--any: 

(a)      nation, state, county, city, town, borough, village, district or other
jurisdiction; 
 (b)      federal, state, local, municipal, foreign or other
government; 
 (c)      governmental or quasi-governmental authority of any nature
(including any agency, branch, department, board, commission, court, tribunal or other entity exercising governmental or quasi-governmental powers); 
 (d)      multinational organization or body; 
 (e)      body exercising, or entitled or purporting to exercise, any administrative, executive, judicial, legislative, police, regulatory or taxing authority or power; or

 (f)      official of any of the foregoing. 

“Hazardous Activity”--the distribution, generation, handling, importing, management, manufacturing, processing,
production, refinement, Release, storage, transfer, transportation, treatment or use (including any withdrawal or other use of groundwater) of Hazardous Material in, on, under, about or from any of the Facilities or any part thereof into the
Environment and any other act, business, operation or thing that increases the danger, or risk of danger, or poses an unreasonable risk of harm, to persons or property on or off the Facilities. 

“Hazardous Material”--any substance, material or waste that is hazardous, toxic, infectious, explosive,
radioactive, carcinogenic, ignitable, corrosive, reactive or otherwise harmful to the Environment or human health, including those which are or will foreseeably be regulated by any Governmental Body under Environmental Law, including any material,
substance or waste which is defined as a “hazardous waste,” “hazardous material,” “hazardous substance,” “extremely hazardous waste,” “restricted hazardous waste,” “contaminant,”
“toxic waste” or “toxic substance” under any provision of Environmental Law, and including petroleum, petroleum products, asbestos, 

  
 5 

 
presumed asbestos-containing material or asbestos-containing material, urea formaldehyde and polychlorinated biphenyls. 

“Improvements”--all buildings, structures, fixtures and improvements located on the Land or included in the
Assets, including those under construction. 
 “Indemnified Person”--as defined in Section 11.7.

 “Indemnifying Person”--as defined in Section 11.7. 

“Intellectual Property Assets”--as defined in Section 3.22(a). 

“Inventories”--all inventories of Company, wherever located, including all finished goods, work in process, raw
materials, spare parts and all other materials and supplies to be used or consumed by Company in the production of finished goods. 
 “IRS”--the United States Internal Revenue Service and, to the extent relevant, the United States Department of the Treasury. 

“Knowledge of Company,” “Knowledge of Shareholder” and other terms of similar import—the actual
awareness after reasonable inquiry of Al Yost, Alain Durand, Steven Yakshe, Laura Heyson, David Gupta, Randall Akers (only as to matters relating to the Company’s water testing applications) and Lasandra Owens (only as to Sections 3.13, 3.20
and 3.21). 
 “Land”--all parcels and tracts of land in which Company has an ownership interest.

 “Lease”--any Real Property Lease or any lease or rental agreement, license, right to use or
installment and conditional sale agreement to which Company is a party and any other Company Contract pertaining to the leasing or use of any Tangible Personal Property. 

“Legal Requirement”--any federal, state, local, municipal, foreign, international, multinational or other
constitution, law, ordinance, principle of common law, code, regulation, statute or treaty. 

“Liability”--with respect to any Person, any liability or obligation of such Person of any kind, character or
description, whether known or unknown, absolute or contingent, accrued or unaccrued, disputed or undisputed, liquidated or unliquidated, secured or unsecured, joint or several, due or to become due, vested or unvested, executory, determined,
determinable or otherwise, and whether or not the same is required to be accrued on the financial statements of such Person. 
 “Marks”--as defined in Section 3.22(a)(i). 

“Material Adverse Effect”—means any circumstance, change or effect that is materially adverse to the
business, assets, financial condition or results of operations of Company taken as a whole, but excluding (i) the effects of changes that are generally applicable to the industries and markets in which the Company operates, (ii) changes in
the United States or world financial markets or general economic conditions, or (iii) effects directly or primarily arising out of the 

  
 6 

 
execution or delivery of this Agreement or the Contemplated Transactions or the public announcement thereof. 

“Occupational Safety and Health Law”--any Legal Requirement designed to provide safe and healthful working
conditions and to reduce occupational safety and health hazards, including the Occupational Safety and Health Act, and any program, whether governmental or private (such as those promulgated or sponsored by industry associations and insurance
companies), designed to provide safe and healthful working conditions. 
 “Order”--any order,
injunction, judgment, decree, ruling, assessment or arbitration award of any Governmental Body or arbitrator. 

“Ordinary Course of Business”--an action taken by a Person will be deemed to have been taken in the Ordinary
Course of Business only if that action is consistent in nature, scope and magnitude with the past practices of such Person and is taken in the ordinary course of the normal, day-to-day operations of such Person. 

“Patents”--as defined in Section 3.24(a)(ii). 

“Permitted Encumbrances”—means (i) any Lien for Taxes not yet due or delinquent or being contested in
good faith by appropriate proceedings, (ii) any statutory Lien arising in the ordinary course of business by operation of law with respect to an obligation or liability that is not yet due or delinquent, (iii) any minor imperfection of
title or similar Lien or encumbrance which could not reasonably be expected to have a Material Adverse Effect, (iv) any Lien created pursuant to any lease of property, real or personal, the obligations under which are capitalized on Financial
Statements, (v) any Lien created pursuant to any other lease to the extent that the then present value of the minimum rental commitment thereunder should, in accordance with GAAP, be capitalized on a balance sheet of the Lessee, and
(vi) any Lien created to secure purchase money indebtedness. 
 “Person”--an individual,
partnership, corporation, business trust, limited liability company, limited liability partnership, joint stock company, trust, unincorporated association, joint venture or other entity or a Governmental Body. 

“Proceeding”--any action, arbitration, audit, hearing, investigation, litigation or suit (whether civil,
criminal, administrative, judicial or investigative, whether formal or informal, whether public or private) commenced, brought, conducted or heard by or before, or otherwise involving, any Governmental Body or arbitrator. 

“Purchase Price”--as defined in Section 2.2. 

“Real Property”--the Land and Improvements and all Appurtenances thereto. 

“Real Property Lease”--any Lease of Facilities, Improvements or other Real Property interests. 

“Record”--information that is inscribed on a tangible medium or that is stored in an electronic or other medium
and is retrievable in perceivable form. 

  
 7 

 “Related Person” – With respect to any Person, any other
Person controlling, controlled by or under common control with such first Person, a director, officer, partner or trustee of such Person or a spouse, child, sibling or parent of such Person. For purposes of this definition, “control” means
the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities, by contract or otherwise. 

“Release”--any release, spill, emission, leaking, pumping, pouring, dumping, emptying, injection, deposit,
disposal, discharge, dispersal, leaching or migration on or into the Environment or into or out of any property. 
 “Remedial Action”--all actions, including any capital expenditures, required or voluntarily undertaken (a) to investigate, clean up, remove, treat or in any other way address any Hazardous
Material; (b) to prevent the Release or threat of Release or to minimize the further Release of any Hazardous Material so it does not migrate or endanger or threaten to endanger public health or welfare or the Environment; (c) to perform
pre-remedial studies and investigations or post-remedial monitoring and care; or (d) to bring all Facilities and the operations conducted thereon into compliance with Environmental Laws and environmental Governmental Authorizations. 

“Representative”--with respect to a particular Person, any director, officer, manager, employee, agent,
consultant, advisor, accountant, financial advisor, broker, legal counsel or other representative of that Person. 
 “Sale Incentive Agreement”—means one of a series of agreements, as amended, entered into between the Company and some of its key employees that results in specified cash payments upon the
successful closing of the transaction contemplated by this Agreement. 
 “SEC”--the United States
Securities and Exchange Commission. 
 “Securities Act”--as defined in Section 3.3. 

“Shareholder”--as defined in the first paragraph of this Agreement. 

“Shareholder Employee Plan”--as defined in Section 10.6(d). 

“Shares”—as defined in the Recitals section of this Agreement. 

“Software”--all computer software and subsequent versions thereof, including source code, object, executable or
binary code, objects, comments, screens, user interfaces, report formats, templates, menus, buttons and icons and all files, data, materials, manuals, design notes and other items and documentation related thereto or associated therewith.

 “Subsidiary”--with respect to any Person (the “Owner”), any corporation or other Person
of which securities or other interests having the power to elect a majority of that corporation’s or other Person’s board of directors or similar governing body, or otherwise having the power to direct the business and policies of that
corporation or other Person (other than securities or other interests having such power only upon the happening of a contingency that has not occurred), are held by the Owner or one or more of its Subsidiaries. 

  
 8 

 “Tangible Personal Property”--all machinery, equipment, tools,
furniture, office equipment, computer hardware, supplies, materials, vehicles and other items of tangible personal property (other than Inventories) of every kind owned or leased by Company (wherever located and whether or not carried on
Company’s books), together with any express or implied warranty by the manufacturers or sellers or lessors of any item or component part thereof and all maintenance records and other documents relating thereto. 

“Tax”--any income, gross receipts, license, payroll, employment, excise, severance, stamp, occupation, premium,
property, environmental, windfall profit, customs, vehicle, airplane, boat, vessel or other title or registration, capital stock, franchise, employees’ income withholding, foreign or domestic withholding, social security, unemployment,
disability, real property, personal property, sales, use, transfer, value added, alternative, add-on minimum and other tax, fee, assessment, levy, tariff, charge or duty of any kind whatsoever and any interest, penalty, addition or additional amount
thereon imposed, assessed or collected by or under the authority of any Governmental Body or payable under any tax-sharing agreement or any other Contract. 
 “Tax Proceeding” --as defined in Section 10.4(e). 

“Tax Return”--any return (including any information return), report, statement, schedule, notice, form,
declaration, claim for refund or other document or information filed with or submitted to, or required to be filed with or submitted to, any Governmental Body in connection with the determination, assessment, collection or payment of any Tax or in
connection with the administration, implementation or enforcement of or compliance with any Legal Requirement relating to any Tax. 
 “Third Party”--a Person that is not a party to this Agreement. 
 “Third-Party Claim”--any claim against any Indemnified Person by a Third Party, whether or not involving a Proceeding. 

“Threat of Release”--a reasonable likelihood of a Release that may require action in order to prevent or
mitigate damage to the Environment that may result from such Release. 
 “U.S. Export Control Laws”
means the Export Administration Regulations (15 C.F.R. Parts 730-744); U.S. Foreign Trade Regulations (15 C.F.R. Part 30); the International Traffic in Arms Regulations (22 C.F.R. Parts 120-130); the U.S. Treasury Department, Office of Foreign
Assets Control regulations (30 C.F.R. Parts 500-599; and the Antiboycott laws (15 C.F.R. Part 760 and Section 999 of the U.S. Internal Revenue Code)). 
 “U.S. Import Laws” means laws and regulations administered by Customs under Title 19 of the U.S. Code and Title 19 of the Code of Federal Regulations and the U.S. Department of Justice, Bureau
of Alcohol, Tobacco, Firearms and Explosives (“BATFE”) regulations (27 C.F.R. Part 447). 
 “U.S.
Trade Control Agencies” includes, but is not limited to, BATFE, BIS, DDTC, DOJ, Internal Revenue Service, OFAC, Office of Antiboycott Compliance, U.S. Census Bureau, Foreign Trade Division, and U.S. Immigration and Customs Enforcement.

  
 9 

 “WARN Act”--as defined in Section 3.20(d). 

“Working Capital Range”—as defined in Section 2.6(a). 

 

	 	1.2.	 Usage 

 (a)    Interpretation. In this Agreement, unless a clear contrary intention appears: 

  (i)      the singular number includes the plural number and
vice versa; 
   (ii)      reference to any Person
includes such Person’s successors and assigns but, if applicable, only if such successors and assigns are not prohibited by this Agreement, and reference to a Person in a particular capacity excludes such Person in any other capacity or
individually; 
   (iii)      reference to any gender
includes each other gender; 
   (iv)      reference to
any agreement, document or instrument means such agreement, document or instrument as amended or modified and in effect from time to time in accordance with the terms thereof; 

  (v)      reference to any Legal Requirement means such Legal
Requirement as amended, modified, codified, replaced or reenacted, in whole or in part, and in effect from time to time, including rules and regulations promulgated thereunder, and reference to any section or other provision of any Legal Requirement
means that provision of such Legal Requirement from time to time in effect and constituting the substantive amendment, modification, codification, replacement or reenactment of such section or other provision; 

  (vi)      “hereunder,” “hereof,”
“hereto,” and words of similar import shall be deemed references to this Agreement as a whole and not to any particular Article, Section or other provision hereof; 

  (vii)      “including” (and with correlative meaning
“include”) means including without limiting the generality of any description preceding such term; 
   (viii)      “or” is used in the inclusive sense of “and/or”; 

  (ix)      with respect to the determination of any period of
time, “from” means “from and including” and “to” means “to but excluding”; and 
   (x)      references to documents, instruments or agreements shall be deemed to refer as well to all addenda, exhibits, schedules or amendments thereto.

 (b)      Accounting Terms and Determinations. Unless otherwise specified
herein, all accounting terms used herein shall be interpreted and all accounting determinations hereunder shall be made in accordance with GAAP. 

  
 10 

 (c)      Legal Representation of the
Parties. This Agreement was negotiated by the parties with the benefit of legal representation, and any rule of construction or interpretation otherwise requiring this Agreement to be construed or interpreted against any party shall not apply to
any construction or interpretation hereof. 
  

	2.	 Sale and Transfer of Shares; Closing 

  

	 	2.1.	 Sale of Shares 

 Subject to the terms and conditions of this Agreement, at the Closing, Shareholder will sell and transfer the Shares to Buyer and Buyer will purchase the Shares from Shareholder, free and clear of any and
all Encumbrances. 
  

	 	2.2.	 Consideration 

 The consideration for the Shares (the “Purchase Price”) will be Twenty Five Million Dollars ($25,000,000) plus or minus the Adjustment Amount and the Election Tax Cost. The Adjustment Amount
shall be calculated and paid in accordance with Sections 2.5 and 2.6. The Election Tax Cost shall be calculated and paid in accordance with Section 10.4(k)(4). 
  

	 	2.3.	 Closing 

 The purchase and sale provided for in this Agreement (the “Closing”) will take place at the offices of Perkins Coie LLP, 1201 Third Avenue, Suite 4800, Seattle, Washington 98101, at 10:00 a.m.,
local time, on September 8, 2010 or at such other time and place as the parties may otherwise agree. 
  

	 	2.4.	 Closing Obligations 

 In addition to any other documents to be delivered under other provisions of this Agreement, at the Closing: 
 (a)        Shareholder shall deliver to Buyer: 
     (i)        Certificate(s) representing the Shares, duly endorsed or accompanied by duly executed stock powers for transfer to Buyer;

     (ii)       A release of the Company generally and
of any Encumbrances on the Company’s assets other than Permitted Encumbrances; 

    (iii)      Certificates dated as of a date not
earlier than the fifth business day prior to the date hereof as to the good standing of Company, executed by the appropriate officials of the State of Virginia and each jurisdiction in which Company is licensed or qualified to do business as a
foreign corporation as specified in Schedule 3.1(a); 

    (iv)      Resignations of and releases from all of
the Company’s directors and such of its officers as Buyer shall have identified at least five (5) business days in advance of the Closing; 

  
 11 

    (v)      A non-foreign affidavit under Code
Section 1445 in a form and substance reasonably acceptable to Buyer; 

    (vi)      A favorable opinion of Perkins Coie, LLP,
counsel for the Shareholder and the Company, dated as of the Closing Date, in a form and substance reasonably acceptable to Buyer; 
     (vii)      a certificate of the Secretary of Shareholder certifying, as complete and accurate as of the Closing, attached copies of the Governing
Documents of Shareholder, certifying and attaching all requisite resolutions or actions of Shareholder’s board of directors approving the execution and delivery of this Agreement and the consummation of the Contemplated Transactions;

     (viii)      a certificate of the
Secretary of Company certifying, as complete and accurate as of the Closing, attached copies of the Governing Documents of Company, certifying and attaching all requisite resolutions or actions of Company’s board of directors approving the
execution and delivery of this Agreement and the consummation of the Contemplated Transactions; 

    (ix)      a license agreement between Weston
Aerospace Limited (“Weston”) and the Company (the “ASML License Agreement”) permitting the Company to complete certain production and delivery obligations under that certain Revision J of the Last Buy Purchase and Supply
Agreement, as amended, between the Company and ASML (the “ASML Last Buy Agreement”); and 
     (x)      Such other documents as Buyer may reasonably request for the purpose of facilitating the consummation or performance of any of the
Contemplated Transactions. 
 (b)      Buyer shall deliver to Shareholder:

     (i)      the Purchase Price by wire
transfer to an account specified by Shareholder in a writing delivered to Buyer at least three (3) business days prior to the Closing Date; 

    (ii)      a certificate of the Secretary of Buyer
certifying, as complete and accurate as of the Closing, and attaching, all requisite resolutions or actions of Buyer’s board of directors approving the execution and delivery of this Agreement and the consummation of the Contemplated
Transactions. 
  

	 	2.5.	     Adjustment Amount and Payment 

The “Adjustment Amount” (which may be a positive or negative number) will be equal to the amount, if any, by
which the Closing Working Capital, which shall be determined after the Closing Date in accordance with Section 2.6 hereof, either exceeds the upper end of the Working Capital Range (in which case there is a corresponding increase to the
Purchase Price) or is less than the lower end of the Working Capital Range (in which case there is a corresponding decrease to the Purchase Price). After the Adjustment Amount, if any, is determined in accordance with Section 2.6 such
Adjustment Amount shall be paid in accordance with such Section 2.6. 

  
 12 

  

	 	2.6.	 Adjustment Procedure 

  (a)    “Working Capital” as of a given date shall mean the amount calculated by subtracting the current liabilities of the Company as of that date from the current
assets of the Company (exclusive of cash) as of that date, each in the manner set forth on Exhibit 2.6. The “Working Capital Range” is $2,350,000 to $2,850,000. A sample calculation of the Working Capital is set forth on Exhibit 2.6.

  (b)    Buyer shall prepare financial statements (the “Closing Financial
Statements”) of the Company as of the Effective Time and for the period from the date of the Balance Sheet through the Effective Time on the same basis and applying the same accounting principles, policies and practices that were used in
preparing the Balance Sheet, including the principles, policies and practices evidenced on Exhibit 2.6. Buyer shall then determine the Working Capital as of the Effective Time (the “Closing Working Capital”) based upon the Closing
Financial Statements and using the same methodology as was used to prepare Exhibit 2.6. Buyer shall deliver the Closing Financial Statements and its determination of the Closing Working Capital to Shareholder within forty five (45) days
following the Closing Date. 
  (c)    If within thirty (30) days following
delivery of the Closing Financial Statements and the Closing Working Capital calculation Shareholder has not given Buyer written notice of its objection as to the Closing Working Capital calculation (which notice shall state the basis of
Company’s objection), then the Closing Working Capital calculated by Buyer shall be binding and conclusive on the parties and be used in computing the Adjustment Amount. 

 (d)    If Shareholder duly gives Buyer such notice of objection, and if Shareholder and Buyer
fail to resolve the issues outstanding with respect to the Closing Financial Statements and the calculation of the Closing Working Capital within fifteen (15) days of Buyer’s receipt of Shareholder’s objection notice, Shareholder and
Buyer shall submit the issues remaining in dispute to independent accountants reasonably acceptable to both parties (the “Independent Accountants”) for resolution applying the principles, policies and practices referred to in
Section 2.6(b). If issues are submitted to the Independent Accountants for resolution, (i) Shareholder and Buyer shall furnish or cause to be furnished to the Independent Accountants such work papers and other documents and information
relating to the disputed issues as the Independent Accountants may request and are available to that party or its agents and shall be afforded the opportunity to present to the Independent Accountants any material relating to the disputed issues and
to discuss the issues with the Independent Accountants; (ii) the determination by the Independent Accountants, as set forth in a notice to be delivered to both Shareholder and Buyer within thirty (30) days of the submission to the
Independent Accountants of the issues remaining in dispute, shall be final, binding and conclusive on the parties and shall be used in the calculation of the Closing Working Capital; and (iii) Shareholder and Buyer will each bear fifty percent
(50%) of the fees and costs of the Independent Accountants for such determination. 

 (e)    Within three (3) business days after the calculation of the Closing Working Capital
becomes binding and conclusive on the parties, Shareholder or Buyer, as the case may be, shall make the wire transfer payment of the Adjustment Amount provided for in this Section 2.6. If the Adjustment Amount is negative, Shareholder shall
refund the Adjustment Amount to Buyer. If the Adjustment Amount is positive, the Adjustment Amount will be paid by Buyer to Shareholder. 

  
 13 

  

	3.	 Representations and Warranties of Shareholder and Company 

Shareholder and Company represent and warrant to Buyer as follows: 

 

	 	3.1.	    Organization and Good Standing 

(a)        Schedule 3.1(a) contains a complete and accurate list of the
Company’s jurisdiction of incorporation and any other jurisdictions in which it is qualified to do business as a foreign corporation. Company is a corporation duly organized, validly existing and in good standing under the laws of its
jurisdiction of incorporation, with full corporate power and authority to conduct its business as it is now being conducted, to own or use the properties and assets that it purports to own or use, and to perform all its obligations under the Company
Contracts. Company is duly qualified to do business as a foreign corporation and is in good standing under the laws of each state or other jurisdiction in which either the ownership or use of the properties owned or used by it, or the nature of the
activities conducted by it, requires such qualification, except where failure to so qualify could not reasonably be expected to result in a Material Adverse Effect. 

(b)        Complete and accurate copies of the Governing Documents of Company, as
currently in effect, are attached to Schedule 3.1(b). 

(c)        Company (i) has no Subsidiaries, (ii) except as disclosed in
Schedule 3.1(c) has not had any Subsidiary, (iii) does not own any shares of capital stock or other securities of any other Person, and (iv) no former Subsidiary has conducted any business. 

 

	 	3.2.	    Enforceability; Authority; No Conflict 

(a)        This Agreement constitutes the legal, valid and binding obligation of
Shareholder and Company, enforceable against each of them in accordance with its terms. Upon the execution and delivery by Shareholder and/or the Company of the other documents or agreements to be executed or delivered by Shareholder and/or the
Company at the Closing (collectively, the “Shareholder’s Closing Documents”), each of Shareholder’s Closing Documents will constitute the legal, valid and binding obligation of Shareholder and/or the Company, as the case may be,
enforceable against each of them in accordance with its terms. Shareholder and the Company have the absolute and unrestricted right, power and authority to execute and deliver this Agreement and the other Shareholder’s Closing Documents to
which either of them is a party and to perform their respective obligations under this Agreement and the Shareholder’s Closing Documents, and such action has been duly authorized by all necessary corporate action by Shareholder and the Company
and any required third party consents have been obtained. 

(b)        Except as set forth in Schedule 3.2(b), neither the execution
and delivery of this Agreement nor the consummation or performance of any of the Contemplated Transactions will, directly or indirectly (with or without notice or lapse of time): 

    (i)      Breach (A) any provision of any of
the Governing Documents of Shareholder or Company or (B) any resolution adopted by the board of directors of the Shareholder or Company; 

  
 14 

 (ii)      Breach or give any
Governmental Body or other Person the right to challenge any of the Contemplated Transactions or to exercise any remedy or obtain any relief under any Legal Requirement or any Order to which Company or Shareholder may be subject; 

(iii)      contravene, conflict with or result in a violation or breach of
any of the terms or requirements of, or give any Governmental Body the right to revoke, withdraw, suspend, cancel, terminate or modify, any Governmental Authorization that is held by Company or that otherwise relates to the business of Company;

 (iv)      Breach any material provision of, or give any Person
the right to declare a default or exercise any remedy under, or to accelerate the maturity or performance of, or payment under, or to cancel, terminate or modify, any material Company Contract; 

(v)      result in the imposition or creation of any Encumbrance upon or
with respect to any of the Company’s assets. 
 (c)   Except as set forth in Schedule
3.2(c), neither Company nor Shareholder is required to give any notice to or obtain any Consent from any Person in connection with the execution and delivery of this Agreement or the consummation or performance of any of the Contemplated
Transactions. 
  

	 	3.3.	   Capitalization 

 The entire authorized equity securities of Company consist of One Hundred Fifty Thousand (150,000) shares of common stock, no par value per share, of which Eighty Thousand Four Hundred Ninety
(80,490) shares are issued and outstanding and all of which are owned by Shareholder. Shareholder is and will be on the Closing Date the record and beneficial owner and holder of the Shares, free and clear of all Encumbrances. There are no
Contracts relating to the issuance, sale or transfer of any equity securities or other securities of Company, nor are there outstanding any securities or obligations that are convertible into or exchangeable for any shares of capital stock of the
Company. All of the Shares have been duly authorized and validly issued and are fully paid and nonassessable. All of such issued and outstanding shares of Common Stock were offered and sold in compliance with all applicable state and Federal
securities laws, rules and regulations. There are no stock appreciation rights, phantom stock or similar rights in existence with respect to the Company. There are no voting trusts, proxies, or other agreements or understandings with respect to the
voting of any capital stock of the Company. 
  

	 	3.4.	   Financial Statements 

 (a)      Schedule 3.4 contains: (a) an unaudited balance sheet of Company as at July 31, 2010 (the “Balance Sheet”), and the related unaudited
statements of income for the nine (9) month period then ended; (b) unaudited balance sheets of Company for fiscal years 2009, 2008 and 2007, and the related unaudited statements of income for each of the fiscal years then ended. Such
financial statements fairly present, subject to normal year-end adjustments, in all material respects, the financial condition and the results of operations, of Company as at the respective dates of and for the periods referred to in such financial
statements, all in accordance with GAAP consistently applied (except for the exclusion of changes in shareholders’ equity and cash flows and customary 

  
 15 

 
footnotes, which adjustments would not deviate adversely from the financial statements as attached hereto). The financial statements referred to in this Section 3.4 reflect and will reflect
the consistent application of such accounting principles throughout the periods involved, except as disclosed in the notes to such financial statements. The financial statements have been and will be prepared from and are in accordance with the
accounting Records of Company. 
 (b)      The Company has no liability or
obligation (whether accrued, absolute, contingent or otherwise) that would be required to be disclosed on the face of or in the notes to Company financial statements, except for (i) the liabilities and obligations of the Company that are
disclosed in the financial statements on Schedule 3.4 hereto, to the extent and in the amounts so disclosed, and (ii) liabilities and obligations incurred or accrued in the ordinary course of business since July 31, 2010 and
which do not, either individually or in the aggregate, have an adverse effect on the business, assets, operations, prospects or financial condition of the Company. 
  

	 	3.5.	   Books and Records 

 The books of account and other financial Records of Company since January 1, 2004, all of which have been made available to Buyer, are complete and correct in all material respects and represent
actual, bona fide transactions and have been maintained in accordance with sound business practices, including the maintenance of an adequate system of internal controls. The minute books of Company since January 1, 2004, all of which have been
made available to Buyer, contain accurate and complete Records of all meetings held of, and corporate action taken by, the shareholders, the board of directors and committees of the board of directors of Company, if any. 

 

	 	3.6.	   Description of Real Property 

Schedule 3.6 contains a correct legal description, street address and tax parcel identification number of all Land
and a description of all other Real Property. 
  

	 	3.7.	   Leased Real Property 

 The Company (i) does not have any Real Property Leases and (ii) does not use any real property in connection with the operation of its business other than the Real Property. 

 

	 	3.8.	   Real Property; Encumbrances 

(a)      Company owns good and marketable title to the Real Property, free and clear of any
Encumbrances, other than: 

    (i)      Permitted Encumbrances; and 

    (ii)      those described in Schedule 3.8(a)
(“Real Estate Encumbrances”). 
 True and complete copies of (A) all deeds, existing title
insurance policies and surveys of or pertaining to the Real Property and (B) all instruments, agreements and other documents evidencing, creating or constituting any Real Estate Encumbrances have been delivered to Buyer. 

  
 16 

 (b)      Company owns good and transferable
title to all of its other assets free and clear of any Encumbrances other than those described in Schedule 3.8(b) and Permitted Encumbrances. 
  

	 	3.9.	   Condition of Facilities; Assets 

(a)        Use of the Real Property for the various purposes for which it is
presently being used is permitted as of right under all applicable zoning Legal Requirements. All Improvements are in compliance with all material Legal Requirements, including those pertaining to zoning, building and the disabled, are in good
repair and in good condition, ordinary wear and tear excepted. There is no existing or proposed plan to modify or realign any street or highway or any existing or proposed eminent domain proceeding that would result in the taking of all or any part
of any Facility or that would prevent or hinder the continued use of any Facility as heretofore used in the conduct of the business of Company. 
 (b)        Schedule 3.9(b) contains a true, correct and complete list and brief description of all items of Tangible Personal Property owned or leased by the
Company and all leases or agreements under which the Company is lessee of or holds or operates any such Tangible Personal Property. Each item of Tangible Personal Property, and each part of the Facilities, is in good repair and good operating
condition, ordinary wear and tear excepted, and is suitable for use in the Ordinary Course of Business. No item of Tangible Personal Property or part of the Facilities is in need of repair or replacement other than as part of routine maintenance in
the Ordinary Course of Business. The Company has good and marketable title to all of its properties and assets free and clear of all liens, claims, charges, options, forfeitures, rights of seizure, rights of tenants or other encumbrances. Except
pursuant to this Agreement, neither the Company nor the Shareholder is a party to any contract or obligation whereby there has been granted to any Person an absolute or contingent right to purchase, obtain or acquire any rights in any of the assets,
properties or operations of the Company. The Tangible Personal Property does not include any assets associated solely with the ASML Business, except to the extent described in the ASML Transition Manufacturing Agreement. 

(c)        Schedule 3.9(c) contains a true, correct and complete list of
all bank accounts, safe deposit boxes (and the contents thereof) and powers of attorney of the Company and of all Persons authorized to act with respect thereto. 
  

	 	3.10.	   Accounts Receivable 

 All Accounts Receivable that are reflected on the Balance Sheet or on the accounting Records of Company as of the Closing Date represent or will represent valid obligations arising from sales actually
made or services actually performed by Company in the Ordinary Course of Business. The reserves for Accounts Receivable shown on the Balance Sheet or on the Closing Financial Statement are adequate and calculated consistent with past practice.
Except as set forth in Schedule 3.10, there is no contest, claim, defense or right of setoff, other than returns in the Ordinary Course of Business of Company, under any Company Contract with any account debtor of an Account Receivable
relating to the amount or validity of such Account Receivable. Schedule 3.10 contains a complete and accurate list of all Accounts Receivable as of the date of the Balance Sheet which are 60 or more days past due. 

 

	 	3.11.	   Inventories 

  
 17 

 All items included in the Inventories consist of a quality and quantity
usable and, with respect to finished goods, saleable, in the Ordinary Course of Business of Company except for obsolete items and items of below-standard quality, all of which have been written off or written down to net realizable value in the
Balance Sheet or on the accounting Records of Company as of the Closing Date, as the case may be. Company is not in possession of any inventory not owned by Company, including goods already sold. The quantities of each item of Inventories (whether
raw materials, work-in-process or finished goods) are not excessive but are reasonable in the present circumstances of Company. Work-in-process Inventories are now valued, and will be valued on the Closing Date, according to GAAP. 

 

	 	3.12.	   Taxes 

 (a)      Tax Returns Filed and Taxes Paid. Company has filed or caused to be filed on a timely basis all Tax Returns and all reports with respect to Taxes that are or
were required to be filed pursuant to applicable Legal Requirements. All Tax Returns and reports filed by or on behalf of Company are true, correct and complete in all material respects. Company has paid, or made full and adequate provision on the
Closing Financial Statements, for the payment of, all Taxes that have become due for all periods covered by the Tax Returns or otherwise (other than any such Taxes arising in connection with the Section 338 Elections), or pursuant to any
assessment received by Company, except with respect to such Taxes, if any, as are listed in Schedule 3.12(a) and are being contested in good faith. Except as provided in Schedule 3.12(a), Company currently is not the beneficiary of any
extension of time within which to file any Tax Return. There are no Encumbrances (other than Permitted Encumbrances) on any of Company’s assets that arose in connection with any failure (or alleged failure) to pay any Tax, and there is no basis
for assertion of any claims attributable to Taxes which, if adversely determined, would result in any such Encumbrance. Section 3.12(a) of the Disclosure Schedule lists all types of Taxes paid and types of Tax Returns filed by or on behalf of
the Company during all open statutory periods. No claim has been made in writing by a Taxing authority in a jurisdiction where the Company does not file a Tax Return such that it is or may be subject to Tax by that jurisdiction. The Shareholder has
made available to Buyer copies of all Tax Returns filed by or with respect to the Company for all open statutory assessment periods. If any such filing was made on a consolidated basis with an affiliated company, proforma Tax Returns with respect to
the Company have been provided to Buyer. 
 (b)      Tax Proceedings.
Company is not a party to any Tax Proceeding, nor to the Knowledge of the Company has any such Tax Proceeding been threatened. There are no agreements for the extension of time for the assessment of any Taxes of Company. There exists no written
proposed tax assessment or deficiency against Company except as disclosed in Schedule 3.12(b). 

(c)      Specific Potential Tax Liabilities and Tax Situations. 

(i)      Withholding. All Taxes that Company is or was required by
Legal Requirements to withhold, deduct or collect have been duly withheld, deducted and collected and, to the extent required, have been paid to the proper Governmental Body or other Person. 

  
 18 

 (ii)      Tax Sharing or
Similar Agreements. There is no tax sharing agreement, tax allocation agreement, tax indemnity obligation or similar written or unwritten agreement, arrangement, understanding or practice with respect to Taxes (including any advance pricing
agreement, closing agreement or other arrangement relating to Taxes) that will require any payment by Company following the Closing. 
 (iii)      Consolidated Group. Other than to the extent set forth on Schedule 3.12(c)(iii), with respect to Tax periods for which the applicable statute of
limitations has not closed, the Company (i) has not been a member of any affiliated group within the meaning of Code Section 1504 or any similar group defined under a similar provision of state, local or foreign law filing a consolidated
federal income Tax Return (other than a group the common parent of which was Shareholder), and (ii) has no liability for the Taxes of any Person (other than Shareholder and any of its Subsidiaries) under Treasury Regulations
Section 1.1502-6 (or any comparable provision of foreign, state or local law). The Company is a member of a consolidated group of which the Shareholder is the common parent for US income Tax purposes and has been a member of such consolidated
group continuously since its acquisition by the Shareholder in June 2003. The Shareholder and the Buyer are eligible to make the Section 338 Elections with respect to the sale of the Shares by the Shareholder to the Buyer. 

(iv)      Substantial Understatement Penalty. Company has disclosed
on its federal income Tax Returns all material positions taken therein that would otherwise be reasonably likely to give rise to a substantial understatement of federal income Tax within the meaning of Code Section 6662. 

(v)      Tax-Free Distributions. Company has not been a party to a
distribution to which Code Section 355(d) or (e) applies within the two-year period ending on the Closing Date. 
 (vi)      Reportable Transactions. Company has not participated in a “reportable transaction” within the meaning of Treasury Regulation
Section 1.6011-4(b). 
 (vii)      Accounting Methods;
Timing Issues. The Company will not be required to include any item of income in, or exclude any item of deduction from, Taxable income for any Taxable period (or portion thereof) ending after the Closing Date as a result of (i) any change
in method of accounting by the Company or any affiliate thereof (or any of their respective subsidiaries) initiated prior to the Closing or, to the Knowledge of the Company and Shareholder, otherwise required as a result of the consummation of the
transactions contemplated by this Agreement for a taxable period ending on or prior to the Closing Date; (ii) any “closing agreement” as described in Code Section 7121 (or any corresponding or similar provision of state, local,
or foreign income Tax law) executed on or prior to the Closing Date; (iii) prior to the Closing Date, any intercompany transactions or excess loss account described in Treasury Regulations under Code Section 1502 (or any corresponding or
similar provision of state, local, or foreign income Tax law), in each case, relating to transactions or events occurring on or before the Closing Date; (iv) any installment sale or open transaction disposition made on or prior to the Closing
Date; or (v) any prepaid amount received on or prior to the Closing Date. 

  
 19 

 (viii)      Permanent
Establishment. Company does not have nor has had a permanent establishment, as defined in any applicable Tax treaty or convention, in any country other than the United States. 

(ix)        No Reduction of Tax Attributes. The Company
will not be required to reduce any Tax Attribute by reason of the application of Treas. Reg. §1.1502-36 to the transactions contemplated by this Agreement. “Tax Attribute” shall mean any item of basis of property, any item of loss
(including a net operating loss carryover), any item of credit and any other Tax item that would otherwise be taken into account in a Tax period ending after the Closing Date. 

(x)         Each of Shareholder and the Company are United
States persons within the meaning of Section 7701(a)(30) of the Code. 
  

	 	3.13.	   Employee Plans 

 (a)      Schedule 3.13(a) contains a complete and accurate list of all employee benefit plans, policies and arrangements, including, without limitation, all
“employee benefit plans,” as defined in Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), and all employment agreements and other compensation arrangements, sponsored or contributed
to by the Company or any ERISA Affiliate for the benefit of any employee or other individual service provider of the Company or with respect to which the Company has (or could reasonably be expected to have) any Liability (each, an “Employee
Plan” and, collectively, the “Employee Plans”). Schedule 3.13(a) separately identifies Employee Plans sponsored by the Company and Employee Plans sponsored by the Shareholder that cover Company employees or other individual
service providers. The Company has delivered or made available to Buyer, with respect to each Employee Plan (to the extent applicable thereto), true, correct and complete copies of (i) the plan document, as currently in effect, (ii) the
most recent summary plan description, and all summaries of material modifications related thereto, distributed with respect to such Employee Plan; and (iii) the most recent determination letter issued by the IRS with respect to such Employee
Plan. 
 (b)      Each Employee Plan has been maintained, funded and administered
in all material respects in accordance with its terms and in compliance with applicable law, including, without limitation, ERISA and the Code. None of the Company, the Shareholder or, to the Knowledge of the Company, any other Person (i) has
engaged in a prohibited transaction, within the meaning of Section 406 of ERISA or Section 4975 of the Code, with respect to which the Company would incur a material liability or penalty under Section 4975 of the Code or
Section 502(i) of ERISA or (ii) has breached its fiduciary duties under ERISA with respect to any Employee Plan in such a way as would result in a material liability to the Company. All contributions required to be made by the Company to
the Employee Plans have been timely made, accrued, or provided for. 

(c)      Each Employee Plan that is intended to be qualified under Section 401(a) of
the Code (i) is the subject of an unrevoked favorable determination letter from the IRS, (ii) has remaining a period of time under the Code or applicable Treasury Regulations or IRS pronouncements in which to request, and make any
amendments necessary to obtain, such a letter from the IRS, or (iii) is a prototype plan or volume submitter plan entitled, under applicable IRS guidance, to rely on the favorable opinion or advisory letter issued by the IRS to the sponsor of

  
 20 

 
such prototype or volume submitter plan. Nothing has occurred that would reasonably be expected to adversely affect the tax-qualified status of any such Employee Plan. 

(d)      None of the Employee Plans provides medical, dental, life or disability insurance
to any current or former employee of the Company after his or her retirement or other termination of employment, and the Company has never represented, promised or contracted to any employee or former employee that such benefits would be provided,
except (i) to the extent required by applicable law, including, without limitation, Section 4980B of the Code and Part 6 of Subtitle B of Title I of ERISA, and (ii) conversion rights that are a part of the group insurance contracts.

 (e)      At no time during the last six (6) years has the Company
sponsored or contributed to, or been obligated to sponsor or contribute to any employee benefit plan that is subject to Section 302 of ERISA, Title IV of ERISA or Section 412 of the Code (including, without limitation, any
“multiemployer plan,” as defined in Section 4001(a)(3) of ERISA). 

(f)      There are no material Proceedings (other than routine claims for benefits, appeals
of such claims and qualified domestic relations orders) pending or, to the Knowledge of the Company, threatened with respect to any Employee Plan. 
 (g)      The execution of this Agreement and the consummation of the transactions contemplated hereby will not constitute a triggering event under any arrangement which
(either alone or upon the occurrence of any additional or subsequent event) will or may result in any payment, acceleration, vesting or increase in benefits by the Company or under any Employee Plan sponsored by the Company to any person or result
in the payment of any “excess parachute payment” (as defined in Section 280G(b)(1) of the Code) or be nondeductible under Section 280G of the Code. 

(h)      Except as provided in Schedule 3.13(h), each Employee Plan that provides
deferred compensation subject to Code Section 409A complies with the applicable requirements of Code Section 409A (and has so complied for the entire period during which Code Section 409A has applied to such Employee Plan). None of
the transactions contemplated by this Agreement will constitute or result in a violation of Code Section 409A. 
  

	 	3.14.	   Compliance with Legal Requirements; Governmental Authorizations 

(a)      Except as set forth in Schedule 3.14(a) or as addressed with specificity in
Sections 3.12, 3.19, 3.20, 3.21, 3.25 or 3.28: 

  (i)     Company is in material compliance with each Legal
Requirement that is or was applicable to it or to the conduct or operation of its business or the ownership or use of any of its assets; 
   (ii)     Company has not received, in the previous 36 months, any notice or other communication (whether oral or written) from any Governmental Body or any other
Person regarding (A) any actual, alleged, possible or potential violation of, or failure to comply with, any Legal Requirement or (B) any actual, alleged, possible or potential obligation on the part of Company to undertake, or to bear all
or any portion of the cost of, any remedial action of any nature. 

  
 21 

 (b)      Schedule 3.14(b) contains a
complete and accurate list of each Governmental Authorization that is held by Company or that otherwise relates to Company’s business or its assets. Each Governmental Authorization listed or required to be listed in Schedule 3.14(b) is
valid and in full force and effect and the Company is in material compliance with all terms and conditions thereof. 
 (c)      Company has not received, in the previous 36 months, any notice or other communication (whether oral or written) from any Governmental Body or any other Person
regarding (A) any actual, alleged, possible or potential violation of or failure to comply with any term or requirement of any Governmental Authorization or (B) any actual, proposed, possible or potential revocation, withdrawal,
suspension, cancellation, termination of or modification to any Governmental Authorization; and 
 The
Governmental Authorizations listed in Schedule 3.14(b) collectively constitute all of the Governmental Authorizations necessary to permit Company to lawfully conduct and operate its business in the manner in which it currently conducts and
operates such business and to permit Company to own and use its assets in the manner in which it currently owns and uses such assets. 
  

	 	3.15.	   Legal Proceedings; Orders 

(a)      Except as set forth in Schedule 3.15(a), there is no pending or, to
Shareholder’s Knowledge, threatened Proceeding: 

  (i)      by or against Company or that otherwise relates to or
may affect the business of, or any of the assets owned or used by, Company; or 

  (ii)      that challenges, or that may have the effect of
preventing, delaying, making illegal or otherwise interfering with, any of the Contemplated Transactions. 
 To
the Knowledge of the Company, no event has occurred or circumstance exists that is reasonably likely to give rise to or serve as a basis for the commencement of any such Proceeding. Shareholder has delivered to Buyer copies of all pleadings,
correspondence and other documents relating to each Proceeding listed in Schedule 3.15(a). 

(b)      Except as set forth in Schedule 3.15(b): 

  (i)      there is no Order to which Company, its business or
any of the Assets is subject; and 
   (ii)      no
officer or director, or, to the Knowledge of Shareholder, agent or employee, of Company is subject to any Order that prohibits such officer, director, agent or employee from engaging in or continuing any conduct, activity or practice relating to the
business of Company. 
 (c)      None of the items described in Schedule 3.15(a) or
3.15(b), singly or in the aggregate, if pursued and/or resulting in a judgment or decision against the Company would have a material adverse effect on the assets, business, goodwill or financial condition of the Company. 

  
 22 

  

	 	3.16.	   Absence of Certain Changes and Events 

 Except as set forth in Schedule 3.16, since the date of the Balance Sheet, Company has conducted its business only in the Ordinary Course of Business and there has not been any: 

(a)      change in Company’s authorized or issued capital stock, grant of any stock
option or right to purchase shares of capital stock of Company or issuance of any security convertible into such capital stock; 

(b)      amendment to the Governing Documents of Company; 

(c)      payment or increase (except in the Ordinary Course of Business) by Company of any
bonuses, salaries or other compensation to any director, officer or employee of Company or entry into any employment, severance or similar Contract with any director, officer or employee; 

(d)      adoption of, amendment to or increase in the payments to or benefits under, any Employee Plan;

 (e)      damage to or destruction or loss of any asset of the Company with a value in excess of
$50,000, not covered by insurance; 
 (f)      entry into, termination of or
receipt of notice of termination of (i) any license, distributorship, dealer, sales representative, joint venture, credit or similar Contract to which Company is a party, or (ii) any Contract or transaction involving a total remaining
commitment by Company of at least $50,000; 
 (g)      sale (other than sales of
Inventories in the Ordinary Course of Business), lease or other disposition of any asset or property of Company (including the Intellectual Property Assets) with a value in excess of $50,000 or the creation of any Encumbrance on any asset of the
Company other than Permitted Encumbrances; 
 (h)      cancellation or waiver of any claims or
rights with a value to Company in excess of $50,000; 
 (i)      indication by any
customer or supplier representing annual sales or expenses in excess of $50,000 of an intention to discontinue or change the terms of its relationship with Company (other than in connection with the Company’s discontinuation of its ASML
business); 
 (j)      material change in the accounting methods used by Company;
or 
 (k)     Contract by Company to do any of the foregoing. 

 

	 	3.17.	  Contracts; No Defaults 

 (a)      Schedule 3.17(a) contains an accurate and complete list, and Shareholder has delivered to Buyer accurate and complete copies, of: 

  
 23 

  (i)       each
Company Contract that involves performance of services or delivery of goods or materials by Company of an amount or value in excess of One Hundred Twenty Five Thousand dollars ($125,000); 

 (ii)      each Company Contract that involves performance of services
or delivery of goods or materials to Company of an amount or value in excess of One Hundred Twenty Five Thousand dollars ($125,000); 
  (iii)     each Company Contract that was not entered into in the Ordinary Course of Business and that involves expenditures or receipts of Company in excess of Thirty Seven
Thousand Five Hundred dollars ($37,500); 
  (iv)     each Company
Contract affecting the ownership of, leasing of, title to, use of or any leasehold or other interest in any real or personal property (except personal property leases and installment and conditional sales agreements having a value per item or
aggregate payments of less than Fifty Thousand dollars ($50,000) or with a term of less than one year); 
  (v)      each Company Contract with any labor union or other employee representative of a group of employees relating to wages, hours and other conditions of
employment; 
  (vi)     each Company Contract (however named)
involving a sharing of profits, losses, costs or liabilities by Company with any other Person; 

 (vii)    each Company Contract containing covenants that in any way purport to
restrict Company’s business activity or limit the freedom of Company to engage in any line of business or to compete with any Person; 
  (viii)   each employment contract or arrangement (A) which is not terminable by the Company within thirty (30) days without payment of any amount related to severance, or
(B) for any continuing payment after termination of such contract or arrangement of any type or nature, other than payments relating to continuing obligations of the Company under an existing Employee Plan, including, without limitation, any
bonuses and vested commissions; 
  (ix)     each power of
attorney of Company that is currently effective and outstanding; and 

 (x)      each Company Contract for capital expenditures in excess of
Seventy Five Thousand dollars ($75,000). 
 (b)    Except as set forth in Schedule
3.17(b): 
  (i)       each Company Contract identified or required
to be identified in Schedule 3.17(a) is in full force and effect and is valid and enforceable against Company in accordance with its terms; and 

  
 24 

  (ii)     each Company
Contract identified or required to be identified in Schedule 3.17(a) will be unaffected by the Contemplated Transactions and will remain in full force and effect without the consent of any other Person. 

 (iii)    Company is in compliance with all material terms and requirements of
each Company Contract; 
  (iv)     to the Knowledge of the
Company, each other Person that has or had any obligation or liability under any Company Contract is in full compliance with all applicable terms and requirements of such Company Contract; 

 (v)      to the Knowledge of the Company, no event has occurred or
circumstance exists that may result in a Breach of, or give Company or other Person the right to declare a default or exercise any remedy under, or to accelerate the maturity or performance of, or payment under, or to cancel, terminate or modify,
any Company Contract; and 
  (vi)     Company has not given to or
received from any other Person, any notice or other communication (whether oral or written) regarding any actual, alleged, possible or potential violation or Breach of, or default under, any Company Contract. 

(c)    Each Company Contract relating to the sale, design, manufacture or provision of products or
services by Company has been entered into in the Ordinary Course of Business of Company and has been entered into without the commission of any act alone or in concert with any other Person, or any consideration having been paid or promised, that is
or would be in violation of any Legal Requirement. 
  

	 	3.18.	   Insurance 

 (a)      Shareholder has delivered to Buyer: 
    (i)      accurate and complete copies of all summaries of insurance held by Shareholder to which Company is a beneficiary and all policies of insurance (and
material correspondence relating to coverage thereunder) to which Company is a party, a list of which is included in Schedule 3.18(a); and 
    (ii)     any statement by Shareholder’s auditor or any consultant or risk management advisor with regard to the adequacy of Company’s coverage or of
the reserves for claims. 
 (b)      Schedule 3.18(b) describes:

    (i)      any self-insurance arrangement by or affecting
Company, including any reserves established thereunder; 

   (ii)    any Contract or arrangement, other than a policy of
insurance, for the transfer or sharing of any risk to which Company is a party or which involves the business of Company; and 

  
 25 

   (iii)    all obligations of Company to
provide insurance coverage to Third Parties (for example, under Leases or service agreements) and identifies the policy under which such coverage is provided. 
 (c)       Except as set forth in Schedule 3.18(c): 
   (i)      all policies of insurance to which Company is a party or that provide coverage to Company: 

   (A)    are valid, outstanding and enforceable; 

   (B)    are issued by an insurer that is financially sound and reputable;

    (C)    taken together, provide adequate insurance coverage for
Company’s assets and operations for all risks normally insured against by a Person carrying on the same business or businesses as Company in the same location; and 

   (D)    are sufficient for compliance with all Legal Requirements and Company
Contracts; 
   (ii)     Company has not received
(A) any refusal of coverage or any notice that a defense will be afforded with reservation of rights or (B) any notice of cancellation or any other indication that any policy of insurance is no longer in full force or effect or that the
issuer of any policy of insurance is not willing or able to perform its obligations thereunder; 

  (iii)    Company has paid all premiums due, and has otherwise performed
all of its obligations, under each policy of insurance to which it is a party or that provides coverage to Company; and 
   (iv)    Company has given notice to the insurer of all claims that may be insured thereby. 
  

	 	3.19.	  Environmental Matters 

 Except as disclosed in Schedule 3.19: 

(a)       Company is, and at all times has been, in material compliance with, and has
not been and is not in material violation of or liable in any material manner under, any Environmental Law. Neither Company nor Shareholder has any basis to expect, nor has any of them or any other Person for whose conduct they are or may be held to
be responsible received, any actual or threatened order, notice or other communication from (i) any Governmental Body, (ii) the current or prior owner or operator of any Facilities, or (iii) or any other Person of any actual or
potential violation or failure to comply with any Environmental Law, or of any actual or threatened Liability under Environmental Law, including any obligation to undertake or bear the cost of any Environmental, Health and Safety Liabilities with
respect to any Facility or other property or asset (whether real, personal or mixed) in which Company has or had an interest, or with respect to any property or Facility at or to which Hazardous Materials were generated, manufactured, refined,
transferred, imported, used or processed by Company or any other Person for whose conduct it is or may be 

  
 26 

 
held responsible, or from which Hazardous Materials have been transported, treated, stored, handled, transferred, disposed, recycled or received. 

(b)      There are no pending or, to the Knowledge of Company, threatened claims,
Encumbrances, or other restrictions of any nature resulting from any Environmental, Health and Safety Liabilities or arising under or pursuant to any Environmental Law with respect to or affecting any Facility or any other property or asset (whether
real, personal or mixed) in which Company has or had an interest. 

(c)      Company has delivered to Buyer true and complete copies and results of any
reports, studies, analyses, tests, or monitoring initiated by or otherwise in the possession or control of Shareholder or Company pertaining to Hazardous Materials or Hazardous Activities in, on, or under the Facilities, or concerning compliance, by
Company or any other Person for whose conduct it is or may be held responsible, with Environmental Laws. 

(d)      No material Release of Hazardous Materials has occurred at any of the
Company’s Facilities, the Company has not caused a Release of Hazardous Materials at any location nor has the Company arranged by contract, agreement or otherwise, for the transportation, treatment, storage of disposal of Hazardous Materials at
any location which could reasonably be expected to result in liability to the Company under Environmental Law. 

(e)      The Company has no Liabilities under Environmental Laws, and no facts,
circumstances or conditions, existing, initiated or occurring prior to the Closing Date are known to the Company which could reasonably be expected to result in Liability to the Company under any Environmental Law. 

(f)      None of the Company’s current Facilities contain, nor did any of the
Company’s former Facilities contain during the period of the Company’s use, lease or occupancy, above ground or underground tanks or piping used for the management of Hazardous Materials, landfills, impoundments or other units for the
treatment, storage or disposal of Hazardous Materials, PCBs, radioactive materials, urea formaldehyde, toxic mold, lead-based paint or asbestos containing materials. 

(g)      Company has not agreed to assume and has not assumed by operation of law any
Liability of any other Person arising under Environmental Law. 
  

	 	3.20.	   Employees 

 (a)      A complete and accurate list of the following information for each employee, director, independent contractor, consultant and agent of Company, including each
employee on leave of absence: name; job title; date of hiring or engagement; current compensation paid or payable; and sick and vacation leave that is accrued but unused was made available to Buyer. 

(b)      Company has not violated the Worker Adjustment and Retraining Notification Act
(the “WARN Act”) or any similar state or local Legal Requirement. 

(c)      No officer or director, and, to the Knowledge of Shareholder and Company, no other
agent, employee, consultant, or contractor of Company, is bound by any Contract that purports to 

  
 27 

 
limit the ability of such officer, director, agent, employee, consultant, or contractor (i) to engage in or continue or perform any conduct, activity, duties or practice relating to the
business of Company or (ii) to assign to Company or to any other Person any rights to any invention, improvement, or discovery. To the Knowledge of Shareholder and Company, no former or current employee of Company is a party to, or is otherwise
bound by, any Contract that in any way adversely affected, affects, or will affect the ability of Company or Buyer to conduct the business as heretofore carried on by Company. 

 

	 	3.21.	   Labor Disputes; Compliance 

(a)      Company has complied in all material respects with all Legal Requirements relating
to employment practices, terms and conditions of employment, equal employment opportunity, nondiscrimination, immigration, wages, hours, benefits, collective bargaining and other similar requirements, the payment of social security and similar Taxes
and occupational safety and health. Company is not liable for the payment of any Taxes, fines, penalties, or other amounts, however designated, for failure to comply with any of the foregoing Legal Requirements. 

(b)      Except as disclosed in Schedule 3.21(b), (i) Company has not been, and
is not now, a party to any collective bargaining agreement; (ii) there has not been, there is not presently pending or existing, and to Shareholder’s Knowledge there is not threatened, any strike, slowdown, picketing, work stoppage or
employee grievance process involving Company; (iii) no application or petition for an election of or for certification of a collective bargaining agent is pending; and (iv) to Shareholder’s Knowledge there has been no charge of
discrimination filed against or threatened against Company with the Equal Employment Opportunity Commission or similar Governmental Body. 
  

	 	3.22.	   Intellectual Property Assets 

(a)      The term “Intellectual Property Assets” means all intellectual property
owned, licensed (as licensor or licensee) or used by Company, including: (i) Company’s name, registered and unregistered trademarks, service marks and applications for each of the foregoing; (ii) all patents and patent applications;
(iii) all registered and unregistered copyrights (collectively, “Copyrights”); (iv) all rights in internet web sites and internet domain names presently used by Company and (v) all inventions, discoveries, techniques,
processes, methods, formulae, designs, computer software, trade secrets, confidential information, know-how and ideas which are owned, licensed or used by the Company. All Intellectual Property Assets described in subparts (i) through
(iv) inclusive are listed on Schedule 3.22(a). 
 (b)      Except as
set forth in Schedule 3.22(b), the Intellectual Property Assets are all those necessary for the operation of Company’s business as it is currently conducted. Company is the owner or licensee of all right, title and interest in and to
each of the Intellectual Property Assets, free and clear of all Encumbrances, and has the right to use without payment to a Third Party all of the Intellectual Property Assets, other than in respect of licenses listed in Schedule 3.22(b).
Except as set forth in Schedule 3.22(b) (i) to Company’s knowledge, no Intellectual Property Asset is infringed or has been challenged or threatened in any way and (ii) none of the products manufactured or sold, nor any process
or know-how used, by Company infringes or is alleged to infringe any patent or other proprietary right of any other Person. 

  
 28 

  

	 	3.23.	  Brokers or Finders 

 Neither Shareholder nor Company nor any of their Representatives have incurred any obligation or liability, contingent or otherwise, for brokerage or finders’ fees or agents’ commissions or
other similar payments in connection with the sale of Company’s business or the Contemplated Transactions, other than the fee due to Technowledgey Strategic Group. 

 

	 	3.24.	  Affiliate Transactions 

 After the Closing, neither the Shareholder nor any of its Subsidiaries, nor any of their directors or officers, will have any interest in any property (real or personal, tangible or intangible) used by
the Company. Except as set forth in Schedule 3.24, as of the Closing there will be no contract, agreement or license between the Shareholder, any of its Subsidiaries, or any of their directors or officers, on the one hand, and the Company, on
the other hand, other than contracts, agreements or licenses contemplated to be entered into in connection with this Agreement, and there shall exist no Liability of the Company to the Shareholder, any of its Subsidiaries, or any of their
directors or officers. 
  

	 	3.25.	  Export Compliance 

 Neither the Company nor any of their current or former employees, representatives, agents, consultants, independent contractors, subcontractors, leased employees, volunteers, or “temps” in
connection with his or her affiliation with, or the performance of his or her duties to, the Company: (A) have engaged in any activity or transaction prohibited by or in violation of any U.S. Export Control or Import Law; (B) have been the
recipient of a subpoena, warning letter, finding of violation letter, charging letter, draft charging letter, or other document alleging a violation, or possible violation, of any U.S. Export Control or Import Law from any U.S. Trade Control Agency;
(C) have been (x) subject of an indictment for a violation or violations of any U.S. Export Control or Import Law; (y) convicted of violating any U.S. Export Control or Import Law or (z) barred or suspended, even temporarily,
from doing business with any agency of the U.S. Government as a result of a violation of any U.S. Export Control or Import Law; (D) (x) is an Embargoed Person; (y) is owned or controlled by, or is acting on behalf of, an Embargoed
Person or (z) has engaged in activities, dealings or transactions with or involving an Embargoed Person; (E) has entered into a settlement, plea agreement, or deferred prosecution agreement with any U.S. Trade Control Agency for alleged
violations of any U.S. Export Control or Import Law; or (F) has been officially reprimanded or terminated in whole or in part due to their violation of Company policies and procedures related to U.S. Export Control or Import Laws. There is no
pending or, to the Knowledge of the Company, threatened U.S. Trade Control Agency proceeding, investigation, audit or enforcement action against the Company or any of its current or former employees, representatives, agents, consultants, independent
contractors, subcontractors, leased employees, volunteers, or “temps” in connection with his or her affiliation with, or the performance of his or her duties to, the Company or any of its Subsidiaries. The Company does not have any pending
or anticipated disclosures to any U.S. Trade Control Agency for potential violations of any U.S. Export Control or Import Law. All voluntary self disclosures that have been submitted to a U.S. Trade Control Agency involving potential violations of
U.S. Export Control or Import Laws have been disclosed to the Buyer. There have been no potential violations of U.S. Export Control or 

  
 29 

 
Import Laws that have been discovered by the Company, but not reported to a U.S. Trade Control Agency. 
  

	 	3.26.	  Sufficiency of Assets; Operations of Business 

 Except as set forth on Schedule 3.26, the assets owned, leased or licensed by the Company, and the Company’s rights under the Company Contracts and Governmental Authorizations, constitute all
of the assets, properties, contract rights and licenses that (a) are reasonably necessary for the Company to operate its business in substantially the same manner as such operations are presently conducted, (b) are reasonably sufficient to
operate the business as a going concern, and (c) are used by the Company to operate its business. Schedule 3.26 contains a complete and accurate description of all services and support provided by Shareholder to Company. 

 

	 	3.27.	  Customers and Suppliers. 

 (a)      Schedule 3.27(a) is a complete and correct list of the twenty (20) largest (as measured by revenue) customers of Company (the “Material
Customers”) for the twelve (12) month period ending June 30, 2010 and sets forth opposite the name of each Material Customer the amount billed to such customer during such period. Except as set forth in Schedule 3.27(a), in the
last twelve (12) months, no Material Customer has cancelled or otherwise terminated, or threatened to cancel or terminate (whether verbally or in writing), its relationship with the Company. The Company has not received any notice, whether
verbal or written, and has no Knowledge that any Material Customer intends to cancel or otherwise materially modify its relationship with the Company. There are no claims, disputes or re-negotiations between the Company and any of its customers and
there is no basis for any such claim, dispute or re-negotiation. 

(b)      Schedule 3.27(b) is a complete and correct list of the twenty
(20) largest vendors, suppliers, service providers and other similar business relations of the Company (the “Material Vendors”) for the twelve (12) month period ending June 30, 2010 and sets forth opposite the name of
each Material Vendor the amount paid to such vendor during such period. Except as set forth in Schedule 3.27(b), in the last twelve (12) months, no Material Vendor has cancelled or otherwise terminated, or threatened to cancel or
terminate, its relationship with the Company. Shareholder has not received any notice, and has no knowledge that any Material Vendor intends to cancel or otherwise materially modify (including, without limitation, price increases) its relationship
with the Company. 
  

	 	3.28.	  Absence of Sensitive Payments. 

 Neither the Company nor any of its employees or officers have made any contributions, payments or gifts to or for the private use of any governmental official, governmental employee or governmental agent
in any amount where either the payment or the purpose in making such contribution, payment or gift is illegal under the laws of the United States or any other jurisdiction; has established or maintained any unrecorded fund or asset for any purpose
or made any false or artificial entries on its books; or has made any payments to any Person with the intention or understanding that any part of such payment was to be used for any purpose other than that described in the document supporting the
payment. Neither the Shareholder nor any of its 

  
 30 

 
employees or officers or those of its direct or indirect Subsidiaries have taken any of the actions described in the preceding sentence on behalf of the Company or the Company’s assets or
business. 
  

	4.	Representations and Warranties of Buyer 

 Buyer represents and warrants to Shareholder as follows: 
  

	 	4.1.    Organization	and Good Standing 

 Buyer is a corporation duly organized, validly existing and in good standing under the laws of the State of New Jersey, with full corporate power and authority to conduct its business as it is now
conducted. 
  

	 	4.2.    Enforceability;	Authority; No Conflict 

 (a)      This Agreement constitutes the legal, valid and binding obligation of Buyer, enforceable against Buyer in accordance with its terms. Upon the execution and delivery
by Buyer of the other agreements to be executed or delivered by Buyer at Closing (collectively, the “Buyer’s Closing Documents”), each of the Buyer’s Closing Documents will constitute the legal, valid and binding obligation of
Buyer, enforceable against Buyer in accordance with its respective terms. Buyer has the absolute and unrestricted right, power and authority to execute and deliver this Agreement and the Buyer’s Closing Documents and to perform its obligations
under this Agreement and the Buyer’s Closing Documents, and such action has been duly authorized by all necessary corporate action. 
 (b)      Neither the execution and delivery of this Agreement by Buyer nor the consummation or performance of any of the Contemplated Transactions by Buyer will give any
Person the right to prevent, delay or otherwise interfere with any of the Contemplated Transactions pursuant to: 
  (i)     any provision of Buyer’s Governing Documents; 
  (ii)    any resolution adopted by the board of directors or the shareholders of Buyer; 

 (iii)   any Legal Requirement or Order to which Buyer may be subject; or 

 (iv)   any Contract to which Buyer is a party or by which Buyer may be bound.

 Buyer is not and will not be required to obtain any Consent from any Person in connection with the execution
and delivery of this Agreement or the consummation or performance of any of the Contemplated Transactions. 
  

	 	4.3.    	Certain Proceedings 

There is no pending Proceeding that has been commenced against Buyer and that challenges, or may have the effect of preventing, delaying,
making illegal or otherwise interfering 

  
 31 

 
with, any of the Contemplated Transactions. To Buyer’s Knowledge, no such Proceeding has been threatened. 
  

	 	4.4.	    Brokers or Finders 

 Neither Buyer nor any of its Representatives have incurred any obligation or liability, contingent or otherwise, for brokerage or finders’ fees or agents’ commissions or other similar payment in
connection with the Contemplated Transactions. 
          4.5.
      Financing 
 Buyer possesses and will possess sufficient funds to
consummate the Contemplated Transactions and affirms that it is not a condition to Closing that Buyer obtain financing for or related to any of the Contemplated Transactions. 

 

	 	4.6.	    Operations of Business 

 Buyer recognizes that Shareholder provides to Company services and support listed on Schedule 3.26. Buyer recognizes that such services and support are necessary for the ongoing operation of
Company and that Buyer must provide or contract with a third party to provide the services and support currently being provided by Shareholder. 
  

	5.	Intentionally Omitted 

  

	6.	Intentionally Omitted 

  

	7.	Intentionally Omitted 

  

	8.	Intentionally Omitted 

  

	9.	Intentionally Omitted 

  

	10.	Additional Covenants 

  

	 	10.1	    Nonsolicitation of Employees 

 For a period of three (3) years following Closing, neither Shareholder nor its Related Persons shall directly or indirectly: solicit the employment of or hire any employee of Company, or induce or
attempt to induce any employee of the Company to leave the employ of the Company, or in any way interfere with the relationship between the Company, on the one hand, and any employee thereof, on the other, provided, however, that the foregoing shall
not apply to (i) responses or follow-up hiring in respect of general solicitations or advertisements for job positions not specifically directed to employees of Company or (ii) any employee of Company who is terminated by Buyer or Company
after the Closing Date or terminates his or her employment with Company without any solicitation from Shareholder. 
  

	 	10.2.	    Noncompetition 

  
 32 

 (a)      Noncompetition. For a period
of three (3) years after the Closing Date, Shareholder shall not, anywhere in the world, directly or indirectly (including through any direct or indirect Subsidiary) invest in, own, manage, operate, finance, control, advise, render services to
or guarantee the obligations of any Person whose primary business is the manufacture, sale or distribution of electronic pressure scanning devices for ground testing applications or water level and conductivity monitoring devices (“Competing
Business”), provided, however, that Shareholder may purchase or otherwise acquire up to (but not more than) five percent (5%) of any class of the securities of any Person (but may not otherwise participate in the activities of such Person)
if such securities are listed on any national or regional securities exchange or have been registered under Section 12(g) of the Exchange Act. 
 (b)      Modification of Covenant. If a final judgment of a court or tribunal of competent jurisdiction determines that any term or provision contained in
Section 10.2(a) is invalid or unenforceable, then the parties agree that the court or tribunal will have the power to reduce the scope, duration or geographic area of the term or provision, to delete specific words or phrases or to replace any
invalid or unenforceable term or provision with a term or provision that is valid and enforceable and that comes closest to expressing the intention of the invalid or unenforceable term or provision. This Section 10.2 will be enforceable as so
modified after the expiration of the time within which the judgment may be appealed. This Section 10.2 is reasonable and necessary to protect and preserve Buyer’s legitimate business interests and the value of the Company and to prevent
any unfair advantage conferred on Shareholder. 
 (c)      Shareholder
acknowledges that the Shareholder’s and Company’s expertise in the Competing Business is of a special, unique, and intellectual character which gives said expertise a peculiar value. Shareholder acknowledges and agrees that (i) the
restrictions contained in Sections 10.1 and 10.2 are reasonable in all respects (including, without limitation, with respect to the subject matter, time period and geographical area) and are necessary to protect the value of the Company and
the Shares (including, without limitation, its goodwill), (ii) the Shareholder is primarily responsible for the creation of such value and goodwill as of the Closing Date, (iii) Buyer would not have consummated the Contemplated
Transactions without the restrictions contained in Sections 10.1 and 10.2 and (iv) Buyer would be irreparably damaged if any of the provisions of this Section are not performed in accordance with their specific terms or are otherwise breached.
Accordingly, Shareholder agrees that Buyer is entitled to an injunction or injunctions to prevent breaches of this Section and has the right to specifically enforce this Section against the Shareholder and its Related Persons in addition to any
other remedy to which Buyer may be entitled hereunder, at law or in equity. 
  

	 	10.3.	     Further Assurances 

 The parties shall cooperate reasonably with each other and with their respective Representatives in connection with any steps required to be taken as part of their respective obligations under this
Agreement, and shall (a) furnish upon request to each other such further information; (b) execute and deliver to each other such other documents; and (c) do such other acts and things, all as the other party may reasonably request for
the purpose of carrying out the intent of this Agreement and the Contemplated Transactions. Prior to the Closing, the Shareholder and the Company shall afford Buyer reasonable access to agreed, identified current customers of the Company, upon prior
written consent of the Shareholder, so long as such access is not disruptive to the operations of the business 

  
 33 

 
of the Shareholder, its Subsidiaries or the Company. Each of the Shareholder and its Related Persons will refer all customer inquiries relating to the business of the Company to the Company from
and after the Closing. 
  

	 	10.4.	   Tax Matters 

 (a)      All transfer, documentary, sales, use, stamp and registration Taxes (but excluding income Taxes) resulting from, arising out of, relating to, or caused by this
Agreement and the Contemplated Transactions will be paid one-half by Buyer and one-half by Shareholder. 

(b)      The Shareholder shall include the Company in, and shall file or cause to be filed,
the United States consolidated federal income Tax Return of the Shareholder for all taxable periods of the Company ending on or prior to the Closing Date and where applicable, the Shareholder shall include the Company in, and shall file or cause to
be filed all other consolidated Tax Returns relating to the Company for all Taxable periods of the Company ending on or prior to the Closing Date, and shall pay (or cause to be paid) any and all Taxes due with respect to all of such Tax Returns to
the extent such Taxes were not taken into account in determining Closing Working Capital. The Shareholder shall file (or cause to be filed) all other Tax Returns of the Company required to be filed prior to the Closing Date, and pay (or cause to be
paid) any and all Taxes due with respect to such Tax Returns, to the extent such Taxes were not taken into account in determining Closing Working Capital. Any Tax Returns which the Shareholder files (or causes to be filed) pursuant to the foregoing
after the date of this Agreement shall be prepared in a manner consistent with past practice, unless a contrary treatment is required by the applicable Tax laws, as reasonably determined by the Shareholder. Subsequent to Closing, in the event that
the Shareholder or any Affiliate thereof amends any combined, consolidated or unitary Tax Return which includes the Company or makes a claim for refund with respect to any such Tax Return and if such amendment or refund claim could have a material
adverse affect on the Buyer, the Company, or any of their respective Affiliates for any Taxable period (as reasonably determined by Shareholder), then Shareholder will provide a copy of such amendment or refund claim to Buyer within thirty
(30) days prior to the filing thereof, and any Damages to any Buyer Indemnified Party resulting from such amendment or refund claim shall, without duplication, be subject to indemnification pursuant to Article 11. 

(c)      Following the Closing, Buyer shall prepare (or cause to be prepared) and file (or
cause to be filed) all Tax Returns (other than consolidated, combined or unitary Tax Returns described in Section 10.4(b)(i)) which are required to be filed pursuant to any Legal Requirement with respect to the Company after the Closing Date
(including any separate Company Tax Returns which the Shareholder failed to properly file, or cause to be filed, prior to the Closing Date), and, subject to the right to receive payment from the Shareholder under Section 10.4(i), pay or cause
to be paid all Taxes shown to be due thereon. To the extent that Buyer seeks a payment from Shareholder under Section 10.4(g) with respect to any such Tax Return, Buyer shall cause the Company to provide Shareholder with a copy of such Tax
Return (or in the case of a consolidated, combined, or unitary Tax Return including the Company, the portion of such Tax Return relating to the Company) prior to filing for the Shareholder’s review and approval (which approval will not be
unreasonably withheld, conditioned or delayed). The Shareholder and Buyer shall attempt in good faith to resolve any disagreements regarding such Tax Return prior to the due date for filing such Tax Return. In the event that the Shareholder and
Buyer are unable to resolve any dispute with 

  
 34 

 
respect to such Tax Return prior to the due date for filing, such dispute shall be resolved in accordance with Section 10.4(m). 

(d)      To the extent that any Taxes shown due on a Tax Return which Buyer is required to
file (or cause to be filed) under Section 10.4(b)(i) relate to a Pre-Closing Tax Period or are otherwise the responsibility of the Shareholder under Article 10 or Article 11 of this Agreement, the Shareholder shall make a payment to Buyer in
the amount of such Taxes no later than thirty (30) days after Buyer provides the Shareholder with a copy of such Tax Return (or in the case of a consolidated, combined or unitary Tax Return, the portion relating to the Company) and a statement
setting forth the amount Shareholder owes to the Buyer. If a dispute arises with respect to the underlying Tax Return or the amount of Taxes for which the Shareholder is responsible, the Shareholder and Buyer shall attempt in good faith to resolve
any such disagreement prior to the due date of the Tax Return. If such dispute is not resolved prior to the due date of the Tax Return, the Shareholder shall pay to Buyer the amount that the Shareholder believes in good faith is due and owing (and
the Tax Return shall be filed in the manner that Buyer deems correct); provide, however, if the independent accounting firm resolving the dispute in accordance with Section 10.4(k) determines that the amount of Taxes as being the responsibility
of the Shareholder differs from the amount paid to Buyer, the Shareholder shall pay to the Buyer, or the Buyer shall pay to the Shareholder, the amount necessary to reflect the independent accounting firm’s determination (plus interest
determined at the federal underpayment rate described in Section 6621(a)(2) of the Code). No payment pursuant to this Section 10.4(b)(iii) shall excuse the Shareholder from its indemnification obligations pursuant to Article 10 if the
amount of Taxes as ultimately determined (on audit or otherwise) for the periods covered by such Tax Return exceeds the amount of the Shareholder’s payment pursuant to this Section 10.4(b)(iii). 

(e)      Any Tax sharing agreement between Shareholder and Company shall be terminated as
of the Closing Date and will have no further effect for any taxable year, and all amounts due as of the Closing Date from or to Shareholder under any such tax sharing agreement shall be finally determined by Shareholder and paid or otherwise settled
by Shareholder or Company on or prior to the Closing Date. 
 (f)      Buyer,
Company and Shareholder shall cooperate fully, as and to the extent reasonably requested by the other party, in connection with the filing of Tax Returns pursuant to this Section 10.4 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 materials provided hereunder. Company and Shareholder agree to (i) retain all books and records with respect to Tax matters pertinent to the Company
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 Shareholder, any extensions thereof) of the respective taxable periods, and abide by all
record retention agreements entered into with any Taxing authority, and (ii) give the other party reasonable written notice prior to transferring, destroying or discarding any such books and records, and, if the other party so requests, Company
or Shareholder, as the case may be, shall allow the other party to take possession of such books and records. 

  
 35 

 (g)      With respect to all periods ending on
or prior to the Closing Date, Shareholder shall have the exclusive authority to (1) represent the Company before any Governmental Body in any audit, contest, claim, proceeding or inquiry regarding the Tax consequences of the operations of the
Company (a “Tax Proceeding”) and (2) settle or contest, in its sole discretion, any such Tax Proceeding; provided, however, that Shareholder shall allow Buyer and its counsel to participate in, but not control, any such Tax Proceeding
at Buyer’s sole expense. Shareholder shall keep Buyer fully and timely informed with respect to the commencement, status and nature of any Tax Proceedings involving any Tax liability of Company for such taxable periods. With respect to all
periods that begin immediately following and end after the Closing Date, Buyer shall have the exclusive authority to (1) represent the Company in any Tax Proceeding and (2) settle or contest, in its sole discretion, any such Tax
Proceeding. With respect to any Straddle Period, Buyer shall have the exclusive authority to (1) represent the Company in any Tax Proceeding and (2) settle or contest, in its sole discretion, any such Tax Proceeding, provided, however,
that Buyer shall allow Shareholder and its counsel to participate in, but not control, any such proceeding at Shareholder’s sole expense; provided, however, that Buyer shall allow Shareholder and its counsel to participate in, but not control,
any such proceeding at Shareholder’s sole expense. Buyer shall keep Shareholder fully and timely informed with respect to the commencement, status and nature of any Tax Proceedings involving any Tax liability of the Company for all Pre-Closing
Tax Periods and Straddle Periods. 
 (h)      Buyer and Company shall elect, where
permitted by law, to carry forward any net operating loss or other tax attribute of the Company arising in any taxable period that begins on or after the Closing Date that, absent such election, would be carried back to a taxable period ending on or
prior to the Closing Date. 
 (i)      The Shareholder shall and hereby covenants
and agrees to indemnify and hold harmless the Company and the Buyer with respect to (i) all Taxes (or the non-payment thereof) of the Company for all Taxable periods ending on or before the Closing Date and the portion through the end of the
Closing Date for any Straddle Period (“Pre-Closing Tax Period”), (ii) all Taxes of any member of an affiliated, consolidated, combined, or unitary group of which the Company (or any predecessor of any of the foregoing) is or was a
member on or prior to the Closing Date, including pursuant to Treasury Regulation Section 1.1502-6 or any analogous or similar state, local, or foreign law or regulation, and (iii) any and all Taxes of any Person (other than the Company)
imposed on the Company as a transferee or successor, by contract or pursuant to any law, rule or regulation, which Taxes relate to an event or transaction occurring before the Closing, in each case, to the extent any such Taxes described in any of
the foregoing clauses (i), (ii) or (iii) were not taken into account in determining Closing Working Capital. 
 (j)      For purposes of this Agreement, in the case of any Taxes that are payable for a taxable period that includes (but does not end on) the Closing Date (a “Straddle
Period”), the portion of such Tax which relates to the portion of such Taxable period ending on the Closing Date will (i) in the case of any property, ad valorem or similar Taxes, be deemed to be the amount of such Tax for the entire
Taxable period multiplied by a fraction, the numerator of which will be the number of days in the Taxable period ending on the Closing Date and the denominator of which will be the number of days in the entire Taxable period, and (ii) in the
case of any other Taxes, be deemed equal to the amount that would be payable if the relevant Taxable period ended at the close of business on the Closing Date (and for such purpose, the Taxable period of any partnership or

  
 36 

 
other pass-through entity in which the Company holds an interest will be deemed to end at such time). 
 (k)      Election Under Treasury Regulation Section 1.338(h)(10)-1. 
    (1)       The Shareholder and Buyer agree that, at Buyer’s election, they shall jointly make or cause to be made the election under
Section 338(h)(10) of the Code and Treasury Regulations Section 1.338(h)(10)-1(c) and any corresponding election under state, local or foreign Tax law (the “Section 338 Elections”) with respect to the purchase and sale of the
Shares. The Buyer shall prepare IRS Form 8023 (or any successor form) and any similar state, local or foreign Tax forms (together with any required attachments and schedules) required to make the Section 338 Elections (each an “Election
Form” and collectively, the “Election Forms”). The Shareholder shall properly execute (or cause to be executed) any such Election Forms and promptly return such properly executed forms to Buyer. 

   (2)       The Shareholder, Buyer, and Company agree that the Purchase
Price and the liabilities of the Company (plus other relevant items required under Section 338(h)(10) of the Code) will be allocated for Tax purposes among the assets of the Company and the complete satisfaction of all intercompany debt
obligations between the Shareholder and the Company existing immediately prior to the Closing as set forth on a written statement in a form prepared by Buyer (the “Allocation Statement”) which shall be delivered by Buyer to the Shareholder
within a reasonable time period after the Closing Date (but for purposes of clarification, in any event need not be delivered prior to January 15, 2011). The Allocation Statement shall be subject to Shareholder’s objection in writing to
Buyer within ten (10) days after receipt thereof if, but only if, Shareholder determines in good faith that such Allocation Statement as prepared by Buyer is materially unreasonable and Shareholder includes with such written objection
reasonable details supporting Shareholder’s basis for such determination, and thereafter the Shareholder and Buyer shall cooperate in good faith in resolving such dispute, with each party to be solely responsible for its own costs and expenses
incurred in connection therewith. In the event that any of the allocations set forth in the Allocation Statement are disputed by a Tax authority, the party receiving notice of such dispute shall notify the other parties, and the Shareholder and
Buyer shall cooperate in good faith in responding to such challenge to preserve the effectiveness of such allocation, with each party to be solely responsible for its own costs and expenses incurred in connection therewith. 

   (3)       The Shareholder, Buyer, and Company agree to file, and shall
cause their affiliates to file, all Tax Returns in a manner consistent with the Section 338 Elections and the Allocation Statement and shall take no position contrary thereto, unless otherwise required by law. Buyer and Company shall cooperate
in the preparation and filing of any Election Forms and shall take all such actions as are necessary and appropriate to effectuate the Section 338 Elections. 

   (4)       If Buyer elects to make the Section 338 Elections, Buyer
shall pay to the Shareholder, at the time and in the amounts set forth below, an amount equal to the excess of (i) the amount of federal, state and local income Taxes which the Shareholder is required to pay with respect to the sale of the
Shares, over (ii) the amount of federal, state and local income Taxes which the Shareholder would have been required to pay if the Section 338 Elections were not made in connection with the sale of the Shares (the “Election Tax
Cost”). Buyer agrees to reimburse the Shareholder for all reasonable third party expenses incurred in order to complete an analysis of the 

  
 37 

 
Shareholder’s U.S. federal income tax basis in the Shares of the Company as of the Closing Date as well as an analysis of its federal income tax basis in the assets of the Company as of the
Closing Date (the “Tax Basis Study”), and for any other reasonable out-of-pocket costs incurred by the Shareholder in connection with any of the provisions of this Section 10.4(k), regardless of whether or not Buyer elects under
Section 338(h)(10). The Shareholder and Buyer agree to use commercially reasonable efforts to cause the Tax Basis Study to be completed as soon as practicable after the Closing Date. By December 1, 2010, the Shareholder shall deliver a
statement to Buyer setting forth in good faith the Election Tax Cost. Buyer shall have 30 days to object to the Election Tax Cost. If Buyer fails to object in such 30 day period, the Election Tax Cost determined by the Shareholder shall be the final
Election Tax Cost. If Buyer so objects, Buyer and the Shareholder shall negotiate in good faith to resolve any disputes and reach an agreement as to the final Election Tax Cost. If Buyer and the Shareholder can not resolve their disputes within 30
days of Buyer’s initial objection, the disputes will be submitted to an independent accounting firm mutually acceptable to Buyer and the Shareholder. The independent accounting firm shall resolve all disputed issues, which resolution will be
binding on Buyer and the Shareholder. The fees and expenses of such accounting firm shall be borne equally by Buyer and the Shareholder. The Election Tax Cost shall be paid to the Shareholder no later than 10 days after all disputes are resolved
with respect to the Election Tax Cost, and the final Election Tax Cost is determined. 

(l)      Any dispute as to any matter covered by Section 10.4 shall be resolved by an
independent accounting firm mutually acceptable to the Shareholder and Buyer. The resolution by such accounting firm shall be binding on the parties. The fees and expenses of such accounting firm shall be borne equally by the Shareholder, on one
hand, and Buyer on the other. If any dispute with respect to a Tax Return is not resolved prior to the due date of such Tax Return, such Tax Return shall be filed in the manner in which Buyer deems is correct, provided, however, that Buyer will file
any amended Tax Returns permitted by law to reflect the independent accounting firm’s resolution of the dispute. 
 (m)      Any Tax refund that is received by Buyer or any of its affiliates (including the Company) and any amount credited against Taxes to which Buyer or any of its
affiliates (including the Company) become entitled, in each case, that relate to Taxes of the Company for any Pre-Closing Tax Period or the portion of any period through the end of the Closing Date, to the extent any such refund or credit was not
taken into account in determining Closing Working Capital, shall be for the account of the Shareholder. Buyer shall pay over or cause to be paid over to the Shareholder any such refund or the amount of any such credit within 30 days after receipt
thereof or entitlement thereto. 
  

	 	10.5.	    Pre-Closing Distributions 

 The parties acknowledge that Company is being acquired on a debt-free basis and with sufficient net working capital to permit smooth transition and the on-going operation of the Company (representing by
the Working Capital Range). To that end, Shareholder may cause Company to distribute out any excess cash on or prior to Closing. In addition, Buyer acknowledges that any ownership interest the Company has in assets associated solely with the ASML
Business will have been transferred to a Subsidiary of the Shareholder selected by the Shareholder in advance of Closing (the “ASML Business Transfer”) and such assets as are necessary to permit the Company to perform certain
remaining production and delivery obligations under the ASML 

  
 38 

 
Last Buy Agreement will be licensed to the Company under the terms of the ASML License Agreement. In the event that any assets or rights associated with the business of the Company were
transferred in connection with the ASML Business Transfer that are not related to the ASML Business, Shareholder covenants to promptly transfer, or cause to be transferred, to Company, at Shareholder’s sole expense, any such assets transferred
from Company. 
  

	 	10.6.	  Employees and Benefits 

 (a)      Buyer currently anticipates retaining most of the Company’s current employees after Closing. The foregoing notwithstanding, Buyer shall not be obligated to
provide continuing employment to any such employee after the Closing. Buyer will cause Company to maintain and provide to each such retained employee comparable or superior wages (excluding bonus and other incentive terms) to those enjoyed prior to
Closing until the earlier of (A) the termination of such employee’s employment with the Company and (B) the date which is twelve (12) months following Closing. To the extent a person who is an employee of the Company immediately
prior to the Closing is terminated by Buyer or the Company within the twelve (12) month period following the Closing for any reason other than gross misconduct, Buyer will cause for the Company to pay severance to such employee according to the
following formula: (1) in the case of any employee of the Company other than Steve Yakshe or Laura Heyson, one week’s base pay for each full year of service, with a minimum of two weeks’ base pay and a maximum of sixteen weeks’
base pay, and less any sums paid by Shareholder under a Sale Incentive Agreement, and (2) in the case of Steve Yakshe and Laura Heyson, two-third’s of one week’s base pay for each full year of service, and less any sums paid by
Shareholder under a Sale Incentive Agreement, provided, however that all of the severance payments described in this Section 10.6(a) will be contingent on the employee’s execution of a severance and release agreement in the form
substantially similar to that used by the Company prior to the Closing. Post-Closing Company employee benefit plans, vacation policies, and similar benefits will credit retained employees for years of service to the Company pre-Closing for purposes
of eligibility, vesting, and rates of accrual, as applicable. In addition, each Company employee benefit plan made available by Buyer or the Company after the Closing that is a welfare benefit plan, within the meaning of Section 3(1) of ERISA,
will (a) waive any and all eligibility waiting periods, evidence of insurability requirements and pre-existing condition limitations and exclusions with respect to the retained employees and their spouses and dependents to the extent waived,
satisfied or not included under the corresponding Employee Plan, and (b) recognize for each retained employee and his or her spouse and dependents for purposes of applying annual deductible, co-payment and out-of-pocket maximums under such
Company employee benefit plan any deductible, co-payment and out-of-pocket expenses paid by the retained employee and his or her spouse and dependents under a corresponding Employee Plan during the calendar year in which the Closing Date occurs and
neither Buyer nor Company will impose preexisting condition exclusions upon such retained employees under any group health plan made available by Buyer or Company after Closing. Buyer shall cause Company to honor all accrued paid time off, vacation
and similar benefit accruals for such retained employees. 
 (b)      With respect
to individuals employed by the Company on the Closing Date who continue employment with the Company, Buyer or any of Buyer’s Subsidiaries (or any trade or business that, together with Buyer, is treated as a single employer under
Section 414(b), (c), (m) or (o) of the Code) after the Closing (“Continuing Employees”), Buyer shall cause Buyer’s 401(k) plan to accept a “direct rollover” of such participant’s vested account balances,
including participant 

  
 39 

 
loans, under Shareholder’s 401(k) plan; provided, however, that Buyer’s 401(k) plan will not be required to accept any such rollover if Buyer reasonably determines that such rollover
would constitute an “invalid rollover contribution,” as defined in Treasury Regulation Section 1.401(a)(31)-1, Q&A-14(b)(1). 
 (c)      Effective as of the Closing Date, the Shareholder shall transfer to Buyer (or such other person(s) as Buyer may designate) the health care spending accounts and the
dependent care spending accounts of all Continuing Employees under the Esterline Technologies Flexible Benefits Plan (such accounts are referred to hereinafter, collectively, as the “FSAs”) and Buyer shall assume all liabilities
related thereto. If the aggregate salary reductions (and other contributions) for the current plan year made by participants under the FSAs on or before the Closing Date exceed the aggregate claims for the current plan year paid to such participants
under the FSAs on or before the Closing Date, then, on (or as soon as administratively practicable after) the Closing Date, the Shareholder shall make a cash payment to Buyer (or such other person as Buyer may designate) in an amount equal to such
excess. If, on the other hand, the aggregate salary reductions (and other contributions) for the current plan year made by such participants under the FSAs on or before the Closing Date are exceeded by the aggregate claims for the current plan year
paid to such participants under the FSAs on or before the Closing Date, then, on (or as soon as administratively practicable after) the Closing Date, Buyer shall make a cash payment to the Shareholder (or such other person as the Shareholder may
designate) in an amount equal to such deficit. On or (as soon as administratively practicable after) the Closing Date, Buyer shall provide the Shareholder with a list of the Continuing Employees and the Shareholder shall provide Buyer with the
calculation of the amount of the cash payment required to be made by the Shareholder or Buyer pursuant to this Section 10.6(c). 
 (d)      Subject to Sections 10.7 and 10.10, Shareholder and Company shall take all actions as may be necessary to terminate the Company’s participation in any Employee
Plans sponsored by the Shareholder or any other ERISA Affiliate, as applicable (each a “Shareholder Employee Plan”), effective immediately prior to the Closing Date, and thereafter the Company shall have no Liability thereunder.
Shareholder shall remain liable and shall pay to the Company (or cause the Company to pay), within three business days following Closing, all amounts accrued or to have been accrued through such date under the Esterline Technologies Corporation
Annual Incentive Compensation Plan for Fiscal Year 2010 and the Pressure Systems FY 2010 Performance Share Plan, and the Company shall promptly pay such amounts to its employees, as applicable. 

 

	 	10.7.	    Pre-Closing Expenses 

 In addition to the obligations under Section 10.6(d), promptly after being notified of the amount thereof, Buyer shall reimburse the Shareholder for (or shall cause the Company to reimburse
Shareholder for) any costs and expenses related to the Company’s participation in Shareholder-sponsored insurance and other employee benefit plans (including, without limitation, contributions and other expenses related to participation in the
medical and 401(k) plans, but excluding any amounts accrued or to have been accrued through the Closing under the Esterline Technologies Corporation Annual Incentive Compensation Plan for Fiscal Year 2010 and the Pressure Systems FY 2010 Performance
Share Plan under Section 10.6(d) above), prior to Closing, to the extent the same were accrued expenses on the Company’s Closing Working Capital consistent with prior periods, in an amount not to exceed $20,000. Shareholder shall be liable
for 

  
 40 

 
and shall pay to the employees of the Company, on September 16, 2010, all payroll amounts that were accrued or were to have been accrued by the Company through the Closing Date but remain
unpaid as of such date. 
  

	 	10.8.	    ASML Last Buy Agreement 

 Shareholder and Company shall take all commercially reasonable actions necessary to assign and transfer the ASML Last Buy Agreement, including all repair, replacement and indemnity obligations thereunder,
to a Subsidiary of the Shareholder selected by the Shareholder promptly following the satisfaction of all product delivery obligations by the Company. 
  

	 	10.9.	    Post-Closing Financial Reporting 

 Following the Closing, in addition to the cooperation contemplated with respect to tax matters under Section 10.4, the Buyer will cause the Company to cooperate in providing the Shareholder financial
reporting information required to complete the preparation of its financial statements as set forth in Schedule 10.9. 
  

	 	10.10.	    Post-Closing Employee Benefits 

 Following the Closing and through September 30, 2010, the Shareholder will provide the Company and its employees the employee benefits set forth in Schedule 10.10 in the manner and on the
terms provided by Shareholder to the Company and its employees prior to the Closing Date, at a cost to the Company equal to the amount set forth in such schedule. Buyer shall pay the Shareholder the amount indicated on Schedule 10.10 (or
shall cause the Company to pay the Shareholder such amount) no later than October 8, 2010. 
  

	 	10.11.	    Post-Closing Use of Shareholder Name and Logo 

The Company shall remove Shareholder’s name, logo and other trademarks from all assets, properties and all other
items related to its business, except with regard to inventory where the Shareholder’s name, logo or other trademarks cannot be removed or replaced, as soon as practicable after the Closing Date, but in any event within six weeks of the Closing
Date (the “Transition Period”). During the Transition Period, Shareholder shall refrain from taking any action against the Company or Buyer to enforce its rights in its name, logo and other trademarks, provided that the
Company’s use of Shareholder’s name, logo or other trademarks is limited to activities related to the transition in connection with the Contemplated Transactions. Following the Transition Period, the only permitted use of
Shareholder’s name, logo or other trademarks by the Company or Buyer will be with respect to the sale of inventory that existed as of the Closing Date that includes such name, logo or other trademarks in a fashion that such markings cannot
reasonably be removed or replaced, which inventory may continue to be sold until it is exhausted. 
  

	 	10.12.	    Post-Closing Internet Content 

 For a period of six months following the Closing Date, the Shareholder shall maintain in their current form the webpages and other website content related to the Company and its business, except that the
Shareholder shall, not later than one business day following the Closing Date, add to the Company’s webpage on the Shareholder’s website a notice in a form reasonably acceptable to 

  
 41 

 
the Buyer disclosing the acquisition of the Company by the Buyer, together with a link to the Buyer’s website. 

 

	11.	Indemnification; Remedies 

  

	 	11.1.	    Survival 

 All representations, warranties, covenants and obligations in this Agreement, the Disclosure Schedules, the supplements to the Disclosure Schedules, the certificates delivered pursuant to Section 2.4
and any other certificate or document delivered pursuant to this Agreement shall survive the Closing and the consummation of the Contemplated Transactions, subject to Section 11.6 and shall not merge in the performance of any obligation by any
party hereto. Except as expressly provided in the next sentence below, any examination, inspection or audit of the properties, financial condition or other matters of the Company and its business conducted by the Buyer or on its behalf on or prior
to the Closing Date shall in no way limit, affect or impair the ability of Buyer to rely upon the representations, warranties, covenants and obligations of the Shareholder and the Company set forth herein. The Buyer shall not be entitled to
indemnification pursuant to this Agreement with respect to any representation or warranty of the Shareholder or Company set forth in Article 3 of this Agreement if, as of the date of this Agreement, the Buyer had actual knowledge (without imputation
from others) of an actual breach of such representation or warranty of the Shareholder or Company set forth in Article 3 of this Agreement. The Shareholder shall have the burden of providing that the Buyer had such actual knowledge of such breach in
accordance with the standards set forth in the preceding sentence. The waiver of any condition based on the accuracy of any representation or warranty, or on the performance of or compliance with any covenant or obligation, will not affect the right
to indemnification, payment of damages, or other remedy based on such representations, warranties, covenants and obligations. 
  

	 	11.2.	   Indemnification and Reimbursement By Shareholder 

Shareholder will indemnify and hold harmless Buyer, and Buyer’s Representatives, shareholders, subsidiaries
(including, after the Closing, Company) and Related Persons (collectively, the “Buyer Indemnified Persons”), and will, subject to the procedures in Section 11.7, reimburse the Buyer Indemnified Persons for any actual loss, liability,
claim, damage, amounts paid in settlement, expense (including costs of investigation and defense and reasonable fees and expenses of attorneys, accountants and other professionals), whether or not involving a Third-Party Claim (collectively,
“Damages”), arising from or in connection with: 

(a)      any Breach of any representation or warranty made by Shareholder or Company in
this Agreement or in any certificate, document, writing or instrument delivered by Shareholder pursuant to this Agreement; 
 (b)      any Breach of any covenant or obligation of Shareholder or Company in this Agreement or in any other certificate, document, writing or instrument delivered by
Company or Shareholder pursuant to this Agreement; 
 (c)      any (i) claim
by any Person for brokerage or finder’s fees or commissions or similar payments based upon any agreement or understanding made, or alleged to have been made, by any Person with Company or Shareholder (or any Person acting on their behalf), or
any professional 

  
 42 

 
fees or other expenses incurred by Company, in connection with any of the Contemplated Transactions or (ii) any indebtedness for borrowed money for which the Company is liable after the
Closing that was not reflected in computing the Adjustment Amount; 
 (d)      the
matter described in Section 3.13(h) of the Disclosure Schedules, provided Buyer has cooperated in good faith with Shareholder and its legal counsel to correct (at Shareholder’s sole cost and expense) the noncompliant terms of the Deferred
Compensation Agreements disclosed in Section 3.13(h) of the Disclosure Schedules under IRS Notice 2010-6 (and any additional guidance issued by the IRS) prior to December 31, 2010, and provided further that Buyer satisfies the service
recipient requirements of Section XII of IRS Notice 2010-6; or 
 (e)      the
Shareholder’s or any Affiliate thereof’s amendment of any combined, consolidated or unitary Tax Return which includes the Company or claim for refund with respect to any such Tax Return to the extent such amendment or refund claim has a
material adverse affect on the Buyer, the Company, or any of their respective Affiliates for any Taxable period. 
 For all
purposes of this Article 11, any Damages suffered or incurred by the Company arising from any Breach of a covenant, representation or warranty by any Shareholder or the Company against which Buyer is indemnified and held harmless shall be deemed
suffered and incurred by Buyer, which shall, either independently or jointly with the Company, be entitled to enforce such covenants of indemnity. Further, for all purposes of this Article 11, Damages, following the determination that a breach has
occurred, will be calculated without reference to materiality or similar qualifiers contained in the representation, warranty or covenant that was breached. 
  

	 	11.3.    	Indemnification and Reimbursement By Buyer 

 Buyer will indemnify and hold harmless Shareholder, and will reimburse Shareholder, for any Damages arising from or in connection with: 

(a)      any Breach of any representation or warranty made by Buyer in this Agreement or in any
certificate, document, writing or instrument delivered by Buyer pursuant to this Agreement,; 

(b)      any Breach of any covenant or obligation of Buyer in this Agreement or in any other certificate,
document, writing or instrument delivered by Buyer pursuant to this Agreement; 

(c)      any Liability arising out of the ownership or operation of the Company after the
Effective Time other than to the extent arising out of or in connection with any matter with respect to which any Buyer Indemnified Person is entitled to indemnification pursuant to Section 11.2; or 

(d)      any claim by any Person for brokerage or finder’s fees or commissions or
similar payments based upon any agreement or understanding alleged to have been made by such Person with Buyer (or any Person acting on Buyer’s behalf) in connection with any of the Contemplated Transactions. 

 

	 	11.4.	   Limitations on Amount—Shareholder 

 (a)     Shareholder shall have no liability (for indemnification or otherwise) with respect to claims under Sections 11.2(a) until the total of all Damages with respect to such matters
exceeds 

  
 43 

 
One Hundred Seventy Five Thousand Dollars ($175,000) and then only for the amount by which such Damages exceed One Hundred Seventy Five Thousand Dollars ($175,000). However, this
Section 11.4(a) will not apply to claims arising from (i) Shareholder’s fraud or intentional misrepresentation, or (ii) claims arising under Sections 3.1 (Organization and Good Standing), 3.2 (Enforceability; Authority; No
Conflict), 3.3 (Capitalization) and 3.24 (Affiliate Transactions) (the sections referred to in this Section 11.4(a)(ii), the “Fundamental Representations”). 

(b)      Shareholder’s maximum aggregate liability for Damages for all claims
presented under the indemnification provisions of this Article 11 or otherwise under the terms of this Agreement shall be limited to Five Million Dollars ($5,000,000), except that (i) claims under Sections 3.19 (Environmental Matters) and 3.25
(Export Compliance), when taken together with all other claims presented under the indemnification provisions of this Article 11 or otherwise under the terms of this Agreement, shall be limited to Ten Million Dollars ($10,000,000), (ii) claims
under the Fundamental Representations and under Section 11.2(d) and Section 11.2(e), when taken together will all other claims presented under the indemnification provision of this Article 11 or otherwise under the terms of this Agreement
shall be limited to the Purchase Price. 
 11.5.   Limitations on Amount--Buyer

 (a)      Buyer will have no liability (for indemnification or otherwise)
with respect to claims under Section 11.3(a) until the total of all Damages with respect to such matters exceeds One Hundred Seventy Five Thousand Dollars ($175,000) and then only for the amount by which such Damages exceed One Hundred Seventy
Five Thousand Dollars ($175,000). However, this Section 11.5(a) will not apply to claims arising from Buyer’s fraud or intentional misrepresentation or to claims arising under Sections 4.2 (Authority; No Conflict). 

(b)      Buyer’s maximum aggregate liability for all claims presented under the
indemnification provisions of this Article 11 or otherwise under the terms of this Agreement shall be limited to Five Million Dollars ($5,000,000). 
 11.6.   Time Limitations 

(a)      If the Closing occurs, Shareholder will have liability (for indemnification or
otherwise) with respect to any Breach of a representation or warranty (other than those in Sections 3.19 (Environmental Matters) and 3.25 (Export Compliance) as to which a claim may be made for 36 months, and in Section 3.12 (Taxes), as to
which a claim may be made through the date of the applicable statute of limitations plus thirty days), only if on or before the eighteen month anniversary of the Closing Date Buyer notifies Shareholder of a claim specifying the factual basis of the
claim in reasonable detail. 
 (b)      If the Closing occurs, Buyer will have
liability (for indemnification or otherwise) with respect to any Breach of a representation or warranty only if on or before the eighteen month anniversary of the Closing Date, Shareholder notifies Buyer of a claim specifying the factual basis of
the claim in reasonable detail. 
 11.7.   Third-Party Claims 

  
 44 

 (a)      Promptly after receipt by a Person
entitled to indemnity under Section 11.2 or 11.3 (an “Indemnified Person”) of notice of the assertion of a Third-Party Claim against it, such Indemnified Person shall give notice to the Person obligated to indemnify
under such Section (an “Indemnifying Person”) of the assertion of such Third-Party Claim, provided that the failure to notify the Indemnifying Person will not relieve the Indemnifying Person of any liability that it may have
to any Indemnified Person, except to the extent that the Indemnifying Person demonstrates that the defense of such Third-Party Claim is prejudiced by the Indemnified Person’s failure to give such notice. 

(b)      If an Indemnified Person gives notice to the Indemnifying Person pursuant to
Section 11.7(a) of the assertion of a Third-Party Claim, the Indemnifying Person shall be entitled to participate in the defense of such Third-Party Claim and, to the extent that it wishes (unless (i) the Indemnifying Person is also a
Person against whom the Third-Party Claim is made and the Indemnified Person determines in good faith that joint representation would be inappropriate (ii) the Indemnifying Person fails to provide reasonable assurance to the Indemnified Person
of its financial capacity to defend such Third-Party Claim and provide indemnification with respect to such Third-Party Claim), to assume the defense of such Third-Party Claim with counsel reasonably satisfactory to the Indemnified Person. After
notice from the Indemnifying Person to the Indemnified Person of its election to assume the defense of such Third-Party Claim, the Indemnifying Person shall not, so long as it diligently conducts such defense, be liable to the Indemnified Person
under this Article 11 for any fees of other counsel or any other expenses with respect to the defense of such Third-Party Claim, in each case subsequently incurred by the Indemnified Person in connection with the defense of such Third-Party Claim,
other than reasonable costs of investigation. If the Indemnifying Person assumes the defense of a Third-Party Claim, (i) such assumption will not create a presumption that the claims made in that Third-Party Claim are within the scope of and
subject to indemnification, and (ii) no compromise or settlement of such Third-Party Claims may be effected by the Indemnifying Person without the Indemnified Person’s Consent unless (A) there is no finding or admission of any
violation of a Legal Requirement or any violation of the rights of any Person; and (B) the sole relief provided is monetary damages. If notice is given to an Indemnifying Person of the assertion of any Third-Party Claim and the Indemnifying
Person does not, within ten (10) days after the Indemnified Person’s notice is given, give notice to the Indemnified Person of its election to assume the defense of such Third-Party Claim, the Indemnifying Person will be bound by any
determination made in such Third-Party Claim or any compromise or settlement effected by the Indemnified Person. 
 (c)      Notwithstanding the foregoing, if an Indemnified Person determines in good faith that there is a reasonable probability that a Third-Party Claim may adversely affect
it or its Related Persons other than as a result of monetary damages, the Indemnified Person may, by notice to the Indemnifying Person, assume the exclusive right to defend, compromise or settle such Third-Party Claim, but the Indemnifying Person
will not be bound by any determination of any Third-Party Claim so defended for the purposes of this Agreement or any compromise or settlement effected without its Consent. 

(d)      With respect to any Third-Party Claim subject to indemnification under this
Article 11: (i) both the Indemnified Person and the Indemnifying Person, as the case may be, shall keep the other Person fully informed of the status of such Third-Party Claim and any related Proceedings at all stages thereof where such Person
is not represented by its own counsel, and (ii) the parties agree 

  
 45 

 
(at the Indemnifying Person’s expense) to render to each other such assistance as they may reasonably require of each other and to cooperate in good faith with each other in order to ensure
the proper and adequate defense of any Third-Party Claim. 
 (e)      With respect
to any Third-Party Claim subject to indemnification under this Article 11, the parties agree to cooperate in such a manner as to preserve in full (to the extent possible) the confidentiality of all Confidential Information and the attorney-client
and work-product privileges. In connection therewith, each party agrees that: (i) it will use commercially reasonable efforts, in respect of any Third-Party Claim in which it has assumed or participated in the defense, to avoid production of
Confidential Information (consistent with applicable law and rules of procedure), and (ii) all communications between any party hereto and counsel responsible for or participating in the defense of any Third-Party Claim shall, to the extent
possible, be made so as to preserve any applicable attorney-client or work-product privilege. 

(f)      Any Third-Party Claim that constitutes or relates to a Tax Proceeding shall be governed by the
provisions of Section 10.4 to the extent inconsistent with this Section 11.7. 
  

	 	11.8.	   Other Claims 

 A claim for indemnification for any matter not involving a Third-Party Claim may be asserted by notice to the party from whom indemnification is sought and shall be paid promptly after such notice.

  

	 	11.9.	   Losses Net of Insurance, Etc. 

 Subject to the terms and conditions of this Article 11, following the Closing: 
 (a)      The amount of any Damages for which indemnification is provided under this Agreement shall be net of any amounts (i) actually recovered or (ii) which are
covered by and recoverable, on a commercially reasonable basis, by the Indemnified Person under, insurance policies in effect and applicable to such Damages or from other third parties and of any related reserve and respect thereof reflected on the
final Closing Financial Statements. 
 (b)      Any payment or indemnity required
to be made pursuant to Sections 11.2 or 11.3 shall be adjusted to take into account any reduction in Taxes realized by the Indemnified Persons (which term shall, for purposes of this Paragraph, include the ultimate payer(s) of Taxes in the case of
an Indemnified Person that is a branch or disregarded entity or other pass-through entity for any Tax purposes) as a result of the Damages giving rise to the payment or indemnity. 

(c)      Each party agrees it will not seek punitive, exemplary, special, incidental or
consequential damages (other than such damages sought or obtained by a third party) as to any matter under, relating to or arising out of this Agreement or the Contemplated Transactions (including under any loss of profits theory or purchase price
multiplier calculations). 
 (d)      Notwithstanding Section 9.2, Buyer
shall not be entitled to indemnification with respect to any Damages to the extent reserved as a liability on the Closing Financial Statements. 

  
 46 

 (e)      Except for such equitable remedies as
may be available to enforce Sections 10.1, 10.2 and 12 of this Agreement, the parties hereto agree that the indemnification provisions in this Article 11 are intended to include the exclusive remedy following the Closing as to all Damages either may
incur arising from or relating to the Proposed Transactions or this Agreement, and each party hereby waives, to the full extent they may do so, any of the rights or remedies that may arise under applicable statute, rule or regulation. 

(f)      The indemnities herein are intended solely for the benefit of the person expressly
identified in this Article 11 (and their permitted successors and assigns) and are in no way intended to, nor shall they, constitute an agreement for the benefit of, or be enforceable by, any other person. 

(g)      If any party fails to deliver a payment to the other required under this Article
11 within fifteen (15) business days after the final determination or adjudication (after expiration of all applicable appeal periods) of the amount of such Damages, the amount due will bear interest from its due date to the date it is paid at
a per annum rate equal to the prime rate published in the Wall Street Journal on the date such payment is due. 
  

	12.	Confidentiality 

 The
parties acknowledge that the information being provided to one another in connection with the Contemplated Transactions is subject to the terms of that certain confidentiality letter agreement dated March 22, 2010 between Shareholder and Buyer,
the terms of which are incorporated herein by reference. After the Closing, except for disclosures required by any Legal Requirement, Shareholder and its Related Persons shall treat and hold as confidential any information concerning the business
and affairs of the Company that is not already generally available to the public, including any notes, analyses, compilations, studies, forecasts, interpretations or other documents that are derived from, contain, reflect or are based upon any such
information (the “Confidential Information”), refrain from using any of the Confidential Information, and deliver promptly to the Company, at the request and option of the Company, all tangible embodiments (and all copies) of the
Confidential Information which are in such Person’s possession or under such Person’s control. Notwithstanding the foregoing, Confidential Information shall not include information that is (i) generally available to the public other
than as a result of a breach of this Section 12 or other act or omission of such Person or (ii) rightfully received after the Closing Date from a third party not under any obligation of confidentiality with respect to such
information. If Shareholder or any Related Person is requested or required (by oral question or request for information or documents in any legal proceeding, interrogatory, subpoena, civil investigative demand, or similar process) to disclose any
Confidential Information, such Person shall notify the Company promptly of the request or requirement so that the Company, at its own expense, may seek an appropriate protective order, order or other assurance that confidential treatment shall be
accorded to all or part of such Confidential Information, or waive compliance with the provisions of this Section 12. If, in the absence of a protective order or the receipt of a waiver hereunder, such Person is, on the advice of
counsel, compelled to disclose any Confidential Information, such Person may disclose the Confidential Information. 
  

	13.	General Provisions 

  

	 	13.1.	    Expenses 

  
 47 

 Except as otherwise provided in this Agreement, each party to this Agreement
will bear its respective fees and expenses incurred in connection with the preparation, negotiation, execution and performance of this Agreement and the Contemplated Transactions, including all fees and expenses of its Representatives. If this
Agreement is terminated, the obligation of each party to pay its own fees and expenses will be subject to any rights of such party arising from a Breach of this Agreement by another party. 

 

	 	13.2.	    Public Announcements 

 Shareholder and Buyer shall cooperate with each other to issue a joint press release regarding the Contemplated Transactions following the Closing. 

 

	 	13.3.	    Notices 

 All notices, Consents, waivers and other communications required or permitted by this Agreement shall be in writing and shall be deemed given to a party when (a) delivered to the appropriate address
by hand or by nationally recognized overnight courier service (costs prepaid); (b) sent by facsimile or e-mail with confirmation of receipt by the receiving equipment or party; or (c) received or rejected by the addressee, if sent by certified mail,
return receipt requested, in each case to the following addresses, facsimile numbers or e-mail addresses and marked to the attention of the person (by name or title) designated below (or to such other address, facsimile number, email address or
person as a party may designate by notice to the other parties): 
 Shareholder: Esterline Technologies Corporation 

Attention: Steve Larson 
 Address: 500 108th Avenue N.E., Suite 1500 

   Bellevue, WA 98004 
 Fax no.: (425) 519-1895 
 E-mail address: slarson@esterline.com 

And 
 with a copy to (which shall not constitute
notice): Perkins Coie, Attorneys at Law 
 Attention: Troy Hickman 
 Address: 1201 Third Avenue, Suite 4800 
    Seattle,
WA 98101 
 Fax no.: (206) 359-7356 

E-mail address: thickman@perkinscoie.com 

Buyer: Measurement Specialties, Inc 
 Attention:
Frank Guidone 
 Address: 1000 Lucas Way 
    Hampton, VA 23666 
 Fax no.:
                                        

 E-mail address: frank.guidone@meas-spec.com 

  
 48 

 with a copy to (which shall not constitute notice): DLA Piper LLP (US) 

Attention: Joseph B. Alexander, Jr. 
 Address:
1201 West Peachtree Street, Suite 2800 
    Atlanta, Georgia 30309 

Fax no.: (404) 682-7890 
 E-mail address:
Joe.Alexander@dlapiper,com 
  

	 	13.4.	   Jurisdiction; Service of Process; Mediation; Waiver of Jury Trial 

(a)      Any Proceeding arising out of or relating to this Agreement or any Contemplated
Transaction must be brought in the courts of the State of New York, City of New York, or, if it has or can acquire jurisdiction, in the United States District Court for the Southern District of New York, and each of the parties irrevocably submits
to the exclusive jurisdiction of each such court in any such Proceeding, waives any objection it may now or hereafter have to venue or to convenience of forum, agrees that all claims in respect of the Proceeding shall be heard and determined only in
any such court and agrees not to bring any Proceeding arising out of or relating to this Agreement or any Contemplated Transaction in any other court. The parties agree that either or both of them may file a copy of this paragraph with any court as
written evidence of the knowing, voluntary and bargained agreement between the parties irrevocably to waive any objections to venue or to convenience of forum. Process in any Proceeding referred to in the first sentence of this section may be served
on any party anywhere in the world. 
 (b)      Any controversy or claim arising
out of or relating to this Agreement or any related agreement or any of the Contemplated Transactions will be settled in the following manner: (a) senior executives representing each of Shareholder and Buyer will meet to discuss, call,
correspond or otherwise attempt to resolve the controversy or claim for no less than 30 days; (b) if the controversy or claim is not resolved as contemplated by clause (a), Shareholder and Buyer will, by mutual consent, select an independent
third party to mediate such controversy or claim, provided that such mediation will not be binding upon any of the parties; and (c) if such controversy or claim is not resolved as contemplated by clauses (a) or (b), the parties will have
such rights and remedies as are available under this Agreement or, if and to the extent not provided for in this Agreement, are otherwise available, provided, however, that this Section 13.4(b) shall be inapplicable in the event that a party
determines in good faith that compliance herewith is reasonably likely to have an irreparably adverse impact on such party or its Related Persons. 
 (c)      THE PARTIES HEREBY WAIVE ANY RIGHT TO TRIAL BY JURY IN ANY PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OF THE CONTEMPLATED TRANSACTIONS, WHETHER
NOW EXISTING OR HEREAFTER ARISING, AND WHETHER SOUNDING IN CONTRACT, TORT OR OTHERWISE. THE PARTIES AGREE THAT ANY OF THEM MAY FILE A COPY OF THIS PARAGRAPH WITH ANY COURT AS WRITTEN EVIDENCE OF THE KNOWING, VOLUNTARY AND BARGAINED-FOR AGREEMENT
AMONG THE PARTIES IRREVOCABLY TO WAIVE TRIAL BY JURY AND THAT ANY PROCEEDING WHATSOEVER BETWEEN THEM RELATING TO THIS AGREEMENT OR ANY OF THE CONTEMPLATED TRANSACTIONS 

  
 49 

 
SHALL INSTEAD BE TRIED IN A COURT OF COMPETENT JURISDICTION BY A JUDGE SITTING WITHOUT A JURY. 
  

	 	13.5.	    Waiver; Remedies Cumulative 

 The rights and remedies of the parties to this Agreement are cumulative and not alternative. Neither any failure nor any delay by any party in exercising any right, power or privilege under this Agreement
or any of the documents referred to in this Agreement will operate as a waiver of such right, power or privilege, and no single or partial exercise of any such right, power or privilege will preclude any other or further exercise of such right,
power or privilege or the exercise of any other right, power or privilege. To the maximum extent permitted by applicable law, (a) no claim or right arising out of this Agreement or any of the documents referred to in this Agreement can be
discharged by one party, in whole or in part, by a waiver or renunciation of the claim or right unless in writing signed by the other party; (b) no waiver that may be given by a party will be applicable except in the specific instance for which
it is given; and (c) no notice to or demand on one party will be deemed to be a waiver of any obligation of that party or of the right of the party giving such notice or demand to take further action without notice or demand as provided in this
Agreement or the documents referred to in this Agreement. 
  

	 	13.6.	    Entire Agreement and Modification 

 This Agreement supersedes all prior agreements, whether written or oral, between the parties with respect to its subject matter (including any letter of intent and any confidentiality agreement between
Buyer and Shareholder) and constitutes (along with the Disclosure Letter, Exhibits and other documents delivered pursuant to this Agreement) a complete and exclusive statement of the terms of the agreement between the parties with respect to its
subject matter. This Agreement may not be amended, supplemented, or otherwise modified except by a written agreement executed by the party to be charged with the amendment. 

 

	 	13.7.	    Assignments, Successors and No Third-Party Rights 

No party may assign any of its rights or delegate any of its obligations under this Agreement without the prior written
consent of the other parties. Subject to the preceding sentence, this Agreement will apply to, be binding in all respects upon and inure to the benefit of the successors and permitted assigns of the parties. Nothing expressed or referred to in this
Agreement will be construed to give any Person other than the parties to this Agreement any legal or equitable right, remedy or claim under or with respect to this Agreement or any provision of this Agreement, except such rights as shall inure to a
successor or permitted assignee pursuant to this Section 13.7. 
  

	 	13.8.	    Severability 

 If any provision of this Agreement is held invalid or unenforceable by any court of competent jurisdiction, the other provisions of this Agreement will remain in full force and effect. Any provision of
this Agreement held invalid or unenforceable only in part or degree will remain in full force and effect to the extent not held invalid or unenforceable. 
  

	 	13.9.	    Construction 

  
 50 

 The headings of Articles and Sections in this Agreement are provided for
convenience only and will not affect its construction or interpretation. All references to “Articles,” “Sections” and “Parts” refer to the corresponding Articles, Sections and Parts of this Agreement and the Disclosure
Schedules. 
  

	 	13.10.	    Time of Essence 

 With regard to all dates and time periods set forth or referred to in this Agreement, time is of the essence. 
  

	 	13.11.	    Governing Law 

 This Agreement will be governed by and construed under the laws of the State of Delaware without regard to conflicts-of-laws principles that would require the application of any other law. 

 

	 	13.12.	    Execution of Agreement 

 This Agreement may be executed in one or more counterparts, each of which will be deemed to be an original copy of this Agreement and all of which, when taken together, will be deemed to constitute one
and the same agreement. The exchange of copies of this Agreement and of signature pages by facsimile transmission shall constitute effective execution and delivery of this Agreement as to the parties and may be used in lieu of the original Agreement
for all purposes. Signatures of the parties transmitted by facsimile shall be deemed to be their original signatures for all purposes. 
 [The remainder of this page is intentionally left blank. Signatures appear on the 
 following page.] 

  
 51 

 IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written
above. 
  

									
	Buyer:	 	 	 	Shareholder:
	  
 Measurement Specialties, Inc.
	 		 	Esterline Technologies Corporation
	  
 By:
	 	 /s/ Mark Thomson
	 		 	By:	 	 /s/
Stephen R. Larson

									
					
	Name:	 	 Mark Thomson
	 		 	 Name:	 	 Stephen R. Larson

									
					
	Title:	 	 CFO
	 		 	 Title:	 	 Vice President of Strategy &
Technology

									
		 		 		 	  

      Company:

	 	 	 	 	 	 	  
       Pressure
Systems, Inc.

		 		 		 	  
       By:
	 	 /s/ Steve Yakshe

									
		 		 		 	                Name:	 	 Steve
Yakshe

									
		 		 		 	             Title:	 	 President

  
 [Signature
page to Stock Purchase Agreement]Employment Agreement

 Exhibit 10.1 
 pSivida Corp. 
 400 Pleasant Street 

Watertown, MA 02472 

December 17, 2010 
 Leonard S. Ross

 77 Morency Street 
 Natick, MA 01760

 Dear Mr. Ross: 

On behalf of the Board of Directors of pSivida Corp, a Delaware corporation, I am pleased to offer you, Leonard S. Ross (referred to
herein as “you” or “Executive”), the following employment agreement pursuant to this letter (the “Agreement”): 
 1. Employment: The Company (as defined in Section 8(f) below) agrees to employ you, and you agree to serve in the Company’s employ, on and subject to the terms and conditions hereinafter
set forth. 
 2. Duties and Responsibilities: You will hold the title of and will serve as Vice President, Finance of the
Company and, in such capacity, shall be the Executive Officer that is the Company’s Principal Financial and Accounting Officer and shall oversee all accounting and financial affairs of the Company. You agree to work full-time at your
positions with the Company and to devote your entire working time, skill and attention to the discharge of your duties and responsibilities and to promoting the best interests of the Company. Participation in charitable and professional
organizations is allowed so long as such activities do not interfere with your duties and responsibilities or compete with the business and activities of the Company. 
 3. Term: The term of your employment will be from the date hereof until such time as your employment is terminated in accordance with, and subject to the obligations set forth in, Section 8
and elsewhere in this Agreement. 
 4. Compensation: You shall receive the following compensation: 

(a) Base Salary: Your base salary as of the date hereof will be Two Hundred and Two Thousand Two Hundred and Thirty Dollars
($202,230) per year (the “Base Salary”), payable semi-monthly or in accordance with the policies and procedures of the Company as in effect from time to time, provided that in the event the Company in its sole discretion increases
Executive’s Base Salary above $202,230 the Base Salary as so increased will be referred to as “Base Salary”. Notwithstanding anything contrary in this Agreement, the Company may elect to increase your Base Salary (but not
decrease it without your agreement other than as a result of a Company-wide salary reduction). 

 (b) Bonus: In addition to your base salary, you will be eligible to receive an
annual cash bonus in an amount to be determined by the Company or the Company’s Board of Directors, as the case may be (the “Bonus”). 
 (c) Stock Options: You will be eligible to participate in the Company’s 2008 Incentive Plan in accordance with the terms and guidelines thereof. The issuance of options and shares thereunder
shall be subject to the approval of the Board of Directors or shareholders of the Company. 
 5. Expenses: You shall be
reimbursed for reasonable business-related expenses in accordance with applicable policies and procedures of the Company as in effect from time to time. 
 6. Vacation and Fringe Benefits: You will be entitled to four (4) weeks’ paid vacation per calendar year. In addition you will be entitled to fringe benefits in accordance with the
policies of the Company which benefits shall include, without limitation, (i) participation in any employee pension benefit plan within the meaning of Section 3(2) of the Employee Retirement Income Security Act of 1974, as amended
(“ERISA”), including any 401(k) savings plan adopted or maintained by the Company made generally available to U.S. executives of the Company and (ii) participation in any health insurance, disability insurance, group life
insurance or any other employee welfare benefit plan within the meaning of Section 3(1) of ERISA made generally available to Executive Officers of the Company. 
 7. Taxes: All payments made to you pursuant to this Agreement or otherwise in connection with your employment shall be subject to the usual withholding practices of the Company and will be made in
compliance with existing federal and state requirements regarding the withholding of tax. Moreover, should any benefit payment that is described in this Agreement be subject to Section 409A of the Internal Revenue Code of 1986 as amended, the
Company agrees that, subject to your instruction, it is authorized to, and agrees to, make payments in a manner that complies with the requirements of Section 409A to the fullest extent possible. However, in the event that one or more
provisions of Section 409A is violated, the Company shall not be responsible for the payment of any tax liability, penalties or interest that are imposed upon you as a result of said violation, nor shall the Company be under any obligation to
make you whole or otherwise compensate you for such additional liability, unless such violation results from any action or failure to act by the Company, contrary to its obligations under this Paragraph. 

8. Termination and Severance Benefits: Either you or the Company may at any time terminate your employment with the Company after
giving written notice to the other party, in which case the obligations of the parties and the termination and severance benefits and payments payable upon termination will be as described in this Section 8. 

(a) Termination Upon Death or Disability: If you cease to be an employee of the Company as a result of death or Disability, the
Company will have no further obligation or liability to you hereunder other than for payment in cash within five calendar days after the date of termination of (i) Base Salary earned and unpaid at the date of termination, (ii) Bonus earned
but unpaid at the date of termination, if any, and (iii) compensation for accrued vacation, if any 

  
 -2-

 
(collectively, the “Accrued Obligations”). However, nothing in this Agreement shall adversely affect your rights or those of your family or beneficiaries under any applicable
plans, policies or arrangements of the Company or any other agreement in effect between you and the Company or any subsidiary thereof. 
 (b) Termination by the Company for Cause or by You Without Good Cause: If the Company terminates your employment for Cause (as defined in Section 8(f)) or if you terminate your employment
other than for Good Cause (as defined in Section 8(f)), the Company shall have no further obligation or liability to you hereunder other than for payment of Accrued Obligations. 

(c) Termination by the Company Without Cause or by You for Good Cause other than within 24 months of a Change in Control: If you
terminate your employment for Good Cause by providing the Company with a Termination Notice in accordance with the terms of this Agreement or the Company terminates your employment other than for Cause, then in addition to payment of the Accrued
Obligations, you will receive the severance described below in this Section 8(c). Notwithstanding anything herein to the contrary, in the event the Company requests that you continue as an employee through the Extended Period at your Base
Salary, then you must remain an employee of the Company through the Extended Period in order to receive the severance described in this Section 8(c) (unless your employment is terminated by the Company prior to the expiration of the Extended
Period). 
 (i) Lump Sum Severance Payment: 
 The Company will pay you on the Payment Date a lump sum amount equal to the sum of (x) 75% of your annual Base Salary, plus (y) a pro rata portion of your Maximum Bonus for the year of
termination calculated based on the period from the commencement of the fiscal year until the Termination Date. 
 (ii) The
Company will continue, for a period of one (1) year from the date of termination, to provide you with medical benefits under (as the case may be) the Company’s group medical, dental and vision plan provided to Executive Officers of the
Company. To the extent that the Company is unable to provide such benefits to you under its existing plans, the Company will pay you cash amounts equal to your costs of obtaining medical, dental and vision coverage comparable to the coverage
previously provided under the Company’s plans. 
 (iii) The Company will continue, for a period of one (1) year from
the date of termination, to provide you with benefits under (as the case may be) the Company’s life insurance arrangements and disability arrangements provided to Executive Officers of the Company. To the extent that the Company is unable to
provide such benefits to you under its existing plans, including any conversion rights provided under such plans, the Company will pay you cash amounts equal to the cost the Company would have incurred to provide those benefits to you had you
continued to be employed by the Company. 
 (d) Termination by the Company Without Cause or by You for Good Cause within 24
months of a Change in Control: Notwithstanding any other provision of this Section 8 to the 

  
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contrary, if a Change of Control occurs and within the 24 months thereafter the Company terminates your employment other than for Cause, or you terminate your employment for Good Cause after the
expiration of the Cure Period, then, in addition to payment of the Accrued Obligations, you shall receive the following: 
 (i)
Lump Sum Severance Payment: The Company will pay you on the Payment Date a lump sum amount equal to 100% of the sum of (x) your annual Base Salary, plus (y) your bonus for the completed year immediately preceding the year in which your
employment is terminated. The Company will also pay you on the Payment Date a pro rata portion of your Maximum Bonus for the year of termination calculated based on the period from the commencement of the fiscal year until the Termination Date.

 (ii) The Company will provide you with the benefits set forth in Section 8(c)(ii) and 8(c)(iii). 

(e) Payments under this Agreement shall be made without regard to whether the deductibility of such payments (or any other payments to
or for the benefit of Executive) would be limited or precluded by Internal Revenue Code Section 280G and without regard to whether such payments (or any other payments) would subject Executive to the federal excise tax levied on certain
“excess parachute payments” under Internal Revenue Code Section 4999; provided, that if the total of all payments to or for the benefit of Executive, after reduction for all federal taxes (including the tax described in
Internal Revenue Code Section 4999, if applicable) with respect to such payments (“Executive’s total after-tax payments”), would be increased by the limitation or elimination of any payment under this Agreement, amounts
payable under this Agreement (whether in the form of cash, stock or otherwise) shall be reduced to the extent, and only to the extent, necessary to maximize Executive’s total after-tax payments. The determination as to whether and to what
extent payments under this Agreement are required to be reduced in accordance with the preceding sentence shall be made at the Company’s expense by such accounting, legal or consulting firm as the Company and the Executive may agree.
In the event payments under this Agreement are required to be limited or eliminated pursuant to this Section 8(e), the Executive, in his or her sole discretion, shall determine which payments (e.g., cash payments or stock payments) shall
be limited or eliminated. In the event of any underpayment or overpayment under this Agreement, as determined under this Section 8(e), the amount of such underpayment or overpayment shall forthwith be paid to Executive or refunded to the
Company, as the case may be. 
 (f) Definitions: The following terms shall have the meanings set forth below:

 “Cause” shall mean, in respect of the termination of your employment by the Company, a termination for one
of the following reasons only: (a) willful malfeasance or gross negligence in your performance of the duties of your position that has a material adverse effect on the Company, (b) the material breach by you while you are an employee of
the Company of Sections 1, 2, 3, 5 and 7(2) of the Employee Confidentiality, Proprietary Rights and Noncompetition Agreement, dated September 26, 2006, between pSivida Inc. and the Executive (the “ECPRNA”), (c) fraud
or dishonesty by you with respect to the Company or your employment with the Company, or (d) your conviction of any felony (including, in each case, entry of a guilty or nolo contendere plea and excluding traffic violations or similar
minor 

  
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offenses). The Company may treat a termination of your employment as termination for Cause only after (i) giving you written notice of the intention to terminate for Cause, including a
description of the conduct that the Company believes constitutes the basis for a Cause termination, and of your right to a hearing by the Company’s Board of Directors, (ii) in the event of a termination under clause (a), (b) or
(c) above, providing you with a 30-day period in which to cure the conduct giving rise to the Company’s notice of a Cause termination, (iii) at least 30 days but not more than 45 days after giving the notice, conducting a hearing by
the Board at which you may be represented by counsel, and (iv) giving you written notice of the results of the hearing and the factual basis for the Board’s determination of Cause, which shall require a vote of a majority of the members of
the Board then in office other than yourself. For purposes of this definition of Cause, no act or omission shall be considered to have been “willful” unless it was not in good faith and Executive had knowledge at the time that the act or
omission was not in the best interest of the Company. Except in connection with your opportunity, if any, to cure the conduct giving rise to the Company’s notice of termination for Cause as set forth in clause (ii) above, nothing in the
foregoing sentence shall prevent the Company from terminating your employment pending any determination of Cause as set forth in the foregoing sentence, any such determination shall be retroactive to the date of termination and the Company shall not
be obligated to compensate you hereunder for the period from such termination until such time, if any, as the Company’s Board of Directors determines that such termination was not for Cause. Notwithstanding the foregoing, Cause shall not
include an act or failure to act based on (w) authority given pursuant to a resolution duly adopted by the Company’s Board of Directors, (x) the advice of outside counsel of the Company, (y) any incapacity resulting from
Disability or (z) any actual or anticipated act or failure to act for which notice is provided by the Company after you have provided written notice of a termination for Good Cause. 

“Change of Control” shall mean 
 (A) the acquisition by any Person (defined as any individual, entity or group (within the meaning of Section 13(d)(3) or Section 14(d)(2) of the Securities Exchange Act of 1934, as amended
(“Exchange Act”))) of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 35% or more of the common stock of the Company; provided, however, that for purposes of this subsection (a), an acquisition
shall not constitute a Change of Control if it is: (i) either by or directly from the Company, or by an entity controlled by the Company, (ii) by any employee benefit plan, including any related trust, sponsored or maintained by the
Company or an entity controlled by the Company (“Benefit Plan”), or (iii) by an entity pursuant to a transaction that complies with the clauses (i), (ii) and (iii) of subsection (C) below; or 

(B) individuals who, as of the effective date of this Agreement, constitute the Board (together with the individuals
identified in the proviso to this Section (B), the “Incumbent Board”) cease for any reason to constitute at least a majority of the Board; provided, however, that any individual becoming a director subsequent to the effective date
of this agreement whose election, or nomination for election by the Company’s stockholders, was approved by at least a majority of the directors then comprising the Incumbent Board shall be treated as a member of the Incumbent Board unless he
or she assumed office as a result of an actual or threatened election contest with respect to the election or removal of directors or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board; or

  
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 (C) consummation of a reorganization, merger or consolidation involving the Company, or a
sale or other disposition of all or substantially all of the assets of the Company, (a “transaction”) in each case unless, following such transaction, (i) all or substantially all of the Persons who were the beneficial owners of the
common stock of the Company outstanding immediately prior to such transaction beneficially own, directly or indirectly, more than 50% of the combined voting power of the then outstanding voting securities of the entity resulting from such
transaction (including, without limitation, an entity which as a result of such transaction owns the Company or all or substantially all of the Company’s assets either directly or through one or more subsidiaries) in substantially the same
proportions as their ownership, immediately prior to such transaction, of the outstanding common stock of the Company, (ii) no Person (excluding any entity or wholly owned subsidiary of any entity resulting from such transaction or any Benefit
Plan of the Company or such entity or wholly owned subsidiary of such entity resulting from such transaction) beneficially owns, directly or indirectly, 35% or more of the combined voting power of the then outstanding voting securities of such
entity except to the extent that such ownership existed prior to the transaction and (iii) at least a majority of the members of the board of directors or similar board of the entity resulting from such transaction were members of the Incumbent
Board at the time of the execution of the initial agreement, or of the action of the Board, providing for such transaction; or 

(D) approval by the stockholders of the Company of a liquidation or dissolution of the Company. 

“Company” shall mean pSivida Corp. and any successor of pSivida Corp. (including without limitation a successor by
merger, sale, consolidation, reorganization or other business combination or by acquisition of assets or equity of pSivida Corp.), provided if any such successor has a parent, then Company shall mean the ultimate parent corporation. 

“Cure Period” shall have the meaning set forth in the definition of Good Cause. 

“Disability” shall mean physical or mental incapacity of a nature which prevents you, in the professional judgment of
your physician or, at the Company’s election, a board-certified physician mutually agreed upon by the Company and you, from performing the essential functions of your position with the Company with or without a reasonable accommodation for a
period of one hundred and twenty (120) consecutive days or one hundred eighty (180) days during any consecutive 12-month period. 
 “Executive Officer” shall have the same meaning as the term “officer” under Rule 16a-1(f) of the Securities Exchange Act of 1934. 

“Extended Period Date” shall mean that date specified by the Company in a written notice to you given within 15 days
after the Company receives your Termination Notice which date is no later than 9 months after the date the Company receives your Termination Notice. 

  
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 “Extended Period” shall mean the period beginning on the date the Company
receives your Termination Notice and ending on the Extended Period Date. 
 “Good Cause” shall mean, in
respect of the termination of your employment by you, a termination for one of the following reasons only: (i) failure by the Company to maintain you in the position of Vice President, Finance or a material diminution of the duties,
responsibilities and authority described in Section 2 of this Agreement, excluding for this purpose an isolated, insubstantial and inadvertent action not taken in bad faith and which is remedied by the Company promptly after receipt of written
notice thereof given by you, (ii) a breach by the Company of Section 4(a) or any other material term of this Agreement other than a decrease in Base Salary as a result of a Company-wide salary reduction, or (iii) relocation of your
principal place of work to a location more than thirty (30) miles from your address as set forth in Section 13 below, without your prior consent. You may give a Termination Notice for Good Cause only after (a) giving the Company
written notice of your intention to terminate for Good Cause, (b) providing the Company at least 15 days after receipt of such notice (the “Cure Period”) to cure the conduct or action giving rise to Good Cause, and (c) if
applicable, the Company has failed to cure the action or conduct giving rise to Good Cause during the Cure Period. 

“Maximum Bonus” payable in a year will be calculated assuming all bonus targets or formulas for determining the bonus
in such year had been met if Executive and Board had, prior to the termination of Executive’s employment, agreed on such targets or formulas. If no such targets or formulas have been set as of such Termination Date, then the Maximum Bonus shall
be deemed to be 100 percent of his bonus for the completed year immediately preceding the year in which his employment is terminated. 
 “Payment Date” shall mean that date which is thirty (30) days following the later of (a) the Termination Date, and (b) the date you deliver to the Company a release of
claims in the form attached hereto as Exhibit A. 
 “$” shall mean US$. 

“Termination Date” shall mean the date on which you cease to be an employee of the Company. 

“Termination Notice” shall mean a written notice provided to the Company after the expiration of the Cure Period but no
later than 90 days after a Triggering Event specifying a Termination Date within 90 days of such Triggering Event. 

“Triggering Event” shall mean any action or conduct giving rise to Good Cause. 

(g) Release: Notwithstanding anything to the contrary contained in this Agreement, in order for you to be eligible for any
severance benefits under this Section 8, you must execute and deliver to the Company (and not revoke within seven (7) days of executing) the release of claims in the attached as Exhibit A hereto. 

  
 -7-

 9. No Duty to Mitigate; No Offset: Benefits payable under this Agreement as a result
of termination of Executive’s employment will be considered severance pay in consideration of his past service and his continued service, and his entitlement thereto will neither be governed by any duty to mitigate his damages by seeking
further employment nor offset by any compensation that he may receive from other employment following the date of termination. Notwithstanding the foregoing, you agree that the Company may cease its payment for, or provision of, one or more of the
continued benefits under Section 8(c)(ii) or 8(c)(iii) during the periods set forth therein following the date of your termination from employment to the extent that you obtain comparable benefit coverage with another employer. This provision
shall be applied in an ad seriatim basis so that the Company may only cease payment of those comparable benefits that you obtain with another employer. You agree to notify the Company as soon as practicable in the event that you obtain
comparable coverage or benefits during the period noted above and you acknowledge that the Company’s obligation to continue payment for, or provision of, benefits shall cease from and after the date you obtain comparable coverage. 

10. Indemnification: To the extent permitted by law, the Company will defend, indemnify and hold Executive harmless from and
against any and all losses, liabilities, damages, expenses (including attorneys’ fees and costs), actions, causes of action or proceedings arising directly or indirectly from Executive’s performance of this Agreement or services as an
employee and/or officer of the Company. Executive may retain his own counsel to defend himself in such actions, and the Company will pay for the reasonable costs and expense of such counsel. This indemnification is in addition to any right of
indemnification to which Executive may be entitled under the Company’s Articles of Incorporation and By-laws, any separate indemnification agreements between the Company and Executive, and any insurance policies that may be maintained by the
Company. 
 11. Rights of Survivors: If Executive dies after becoming entitled to benefits under this Agreement following
termination of employment but before all such benefits have been provided, (a) all unpaid cash amounts will be paid to the beneficiary that has been designated by Executive in writing (the “beneficiary”), or if none, to
Executive’s estate, (b) all applicable insurance coverage will be provided to Executive’s family as though Executive had continued to live, and (c) any stock options that become exercisable under Section 8 will be
exercisable by the beneficiary, or if none, the estate. 
 12. Successors: This Agreement will inure to and be binding
upon the Company’s successors. The Company will require any successor to all or substantially all of the business and/or assets of the Company by sale, merger or consolidation (where the Company is not the surviving corporation), lease or
otherwise, to assume this Agreement expressly. This Agreement is not otherwise assignable by the Company or the Executive. 

13. Notices: Any notices required or permitted to be sent under this Agreement shall be effective when delivered by hand or mailed
by registered or certified mail, return receipt requested, and addressed as follows: 
 If to the Company: 

pSivida Corp. 

400 Pleasant Street 
 Watertown, MA 02472 

  
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 Attn: Chief Executive Officer, pSivida Corp. 

With a copy to: 

Ropes & Gray 
 1 International Place 
 Boston, MA 02110 

Attn: Mary Weber 

If to Executive: 

Leonard Ross 
 77
Morency Street 
 Natick, MA 01760 
 Either party may change its address for receiving notices by giving notice to the other party. 
 14. Waiver: The failure of either party to enforce any of the provisions of this Agreement shall not be deemed a waiver thereof. No provision of this Agreement shall be deemed to have been waived
or modified unless such waiver or modification shall be in writing and signed by both parties hereto. 
 15. Entire
Agreement; Termination: This Agreement shall constitute the entire agreement of the parties pertaining to this subject matter and shall supersede all prior agreements, representations and understandings of the parties with respect to such
subject matter. 
 16. Partial Invalidity: If any provision in this Agreement is held by a court of competent
jurisdiction to be invalid, void or unenforceable, the remaining provisions nevertheless shall continue in full force and effect without being impaired or invalidated in any manner. 

17. Counterparts: This Agreement may be executed in several counterparts, each of which shall be deemed to be an original but all
of which together shall constitute one and the same instrument. 
 18. Governing Law: This Agreement shall be governed by
and construed in accordance with the laws of the Commonwealth of Massachusetts. The parties agree that any action to enforce the terms of this Agreement shall be commenced in, and subject to the exclusive jurisdiction of, Suffolk County, Boston,
Massachusetts. 

  
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 19. Surviving Provision: This Agreement shall terminate upon the termination of your
employment with the Company for any reason; provided, however, that the provisions of Sections 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 18 and 19 hereof (and any other operative provisions of this Agreement which, by logical extension, are
necessary to interpret and enforce this Agreement so as to give effect to the parties’ intent) shall survive the termination of your employment for any reason and the termination of this Agreement. 

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

 

			
	PSIVIDA CORP.
		
	By:	 	 /s/ Paul Ashton

	Name: Paul Ashton
	Title:   President & CEO

  

					
	EXECUTIVE
		
	By:	 	 /s/ Leonard S. Ross

		 	Name:	 	Leonard S. Ross

  
 -10-

 EXHIBIT A 

RELEASE OF CLAIMS 
 FOR AND IN CONSIDERATION OF the benefits to be provided me in connection with the termination of my employment, as set forth in the employment agreement between me and pSivida Corp. (the
“Company”) dated as of December 17, 2010 (the “Agreement”), which benefits are subject to my signing of this Release of Claims and to which I am not otherwise entitled, and for other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, I, on my own behalf and on behalf of my heirs, executors, administrators, beneficiaries, representatives and assigns, and all others connected with me, hereby release and forever discharge the
Company, its subsidiaries and other affiliates and all of their respective past, present and future officers, directors, trustees, shareholders, employees, agents, general and limited partners, members, managers, joint venturers, representatives,
successors and assigns, and all others connected with any of them, both individually and in their official capacities, from any and all causes of action, rights and claims of any type or description, known or unknown, which I have had in the past,
now have, or might now have, through the date of my signing of this Release of Claims, in any way resulting from, arising out of or connected with my employment by the Company or any of its subsidiaries or other affiliates or the termination of that
employment or pursuant to any federal, state or local law, regulation or other requirement (including without limitation Title VII of the Civil Rights Act of 1964, the Age Discrimination in Employment Act, the Americans with Disabilities Act, and
the fair employment practices laws of the state or states in which I have been employed by the Company or any of the subsidiaries or other affiliates, each as amended from time to time). 

Excluded from the scope of this Release of Claims is (i) any claim arising under the terms of the Agreement and (ii) any right
of indemnification or contribution that I have pursuant to the Certificate of Incorporation, Constitution, By-Laws or other governing documents of the Company or any of its subsidiaries or other affiliates. 

In signing this Release of Claims, I acknowledge my understanding that I may not sign it prior to the termination of my employment, but
that I may consider the terms of this Release of Claims for up to twenty-one (21) days (or such longer period as the Company may specify) from the later of the date my employment with the Company terminates or the date I receive this Release of
Claims. I also acknowledge that I am advised by the Company and its affiliates to seek the advice of an attorney prior to signing this Release of Claims; that I have had sufficient time to consider this Release of Claims and to consult with an
attorney, if I wished to do so, or to consult with any other person of my choosing before signing; and that I am signing this Release of Claims voluntarily and with a full understanding of its terms. 

I further acknowledge that, in signing this Release of Claims, I have not relied on any promises or representations, express or implied, that are not set
forth expressly in the Agreement. I understand that I may revoke this Release of Claims at any time within seven (7) days of the date of my signing by written notice to the General Counsel of the Company and that this Release of Claims will
take effect only upon the expiration of such seven-day revocation period and only if I have not timely revoked it. 

 Intending to be legally bound, I have signed this Release of Claims under seal as of the date written below.

  

			
	Signature:	 	  

 

			
	Name (please print):	 	  

 

			
	Date Signed:

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