Document:

Agreement for the sale and purchase of Muirhead Aerospace Limited

 Exhibit 10.33 
 Dated 3rd November 2008 
  
 1.     Esterline Technologies Limited 
 2.     Esterline Technologies
Corporation 
 3.     EMA Holdings UK Limited 
 4.     Ametek, Inc. 
  
  
 AGREEMENT 
 for the sale and purchase 
 of the
entire issued share capital 
 of Muirhead Aerospace Limited 
  
  
 CMS Cameron McKenna LLP 
 Mitre House 
 160 Aldersgate Street 
 London EC1A
4DD 
  
 T +44(0)20 7367 3000 
 F +44(0)20 7367 2000 
  
 Execution Copy 

 Table of contents 
  

					
	1.	    	Definitions and Interpretation	  	1
	2.	    	Sale and purchase	  	9
	3.	    	Consideration	  	10
	4.	    	Completion	  	10
	5.	    	Transitional Services and Retention Bonus Payments	  	11
	6.	    	Warranties and undertakings	  	12
	7.	    	Limitation of Seller’s liability	  	14
	8.	    	Protection of goodwill and trade secrets	  	14
	9.	    	Termination	  	16
	10.	    	Third party rights	  	16
	11.	    	Further assurance	  	17
	12.	    	Confidentiality; announcements	  	17
	13.	    	Assignment	  	18
	14.	    	Waiver; variation; invalidity	  	18
	15.	    	Costs and expenses	  	19
	16.	    	Payments	  	19
	17.	    	Guarantee	  	20
	18.	    	Entire agreement	  	20
	19.	    	Counterparts	  	21
	20.	    	Time of the essence	  	21
	21.	    	Notices	  	21
	22.	    	Governing law and jurisdiction	  	22
	23.	    	Seller’s Guarantee	  	23
	24.	    	Purchaser’s Guarantee	  	23
	25.	    	Agent for Service	  	24
		
	Schedule 1 The Companies	  	26
		
	Part 1	  	26
		
	Part 2	  	27
		
	Part 3	  	28
		
	Part 4	  	29
		
	Schedule 2 Properties	  	30
		
	Part 1 Properties	  	30
		
	Part 2 Leases	  	30
		
	Part 3 Letting Documents	  	31
		
	Schedule 3 Intellectual Property	  	32
		
	Part 1 Registered IP (excluding Licences In)	  	32
		
	Part 2 Material unregistered IP (excluding Licences In)	  	34

					
	Part 3 Licences In - registered	  	34
		
	Part 4 Licences In - material unregistered	  	35
		
	Implied licences from some customers of the Business to use specifications and design drawings provided by customers to design and manufacture parts for such customers	  	35
		
	Schedule 4 Information Technology	  	36
		
	Part 1 IT Systems	  	36
		
	Part 2 Domain names	  	37
		
	Schedule 5 Completion Obligations	  	39
			
	1.	    	Seller’s Completion obligations	  	39
	2.	    	Purchaser’s Completion obligations	  	40
		
	Schedule 6 Warranties	  	41
		
	Part 1 General warranties	  	41
			
	1.	    	Power to contract	  	41
	2.	    	The Company	  	41
	3.	    	Connected business	  	42
	4.	    	Accounts	  	43
	5.	    	Post-Balance Sheet Date events	  	44
	6.	    	Transactions with the Seller, directors and Connected Persons	  	45
	7.	    	Finance	  	46
	8.	    	Environment	  	47
	9.	    	Health and Safety	  	49
	10.	    	Other assets	  	49
	11.	    	Insurance	  	50
	12.	    	Litigation	  	51
	13.	    	Licences	  	51
	14.	    	Trading	  	53
	15.	    	Contracts	  	56
	16.	    	Employees	  	57
	17.	    	Pension Schemes	  	59
	18.	    	Intellectual Property Rights	  	61
	19.	    	Information technology and telecommunications	  	64
	20.	    	Legislation	  	65
	21.	    	Information	  	65
	22.	    	Properties	  	65
		
	Part 2 Taxation Warranties	  	68
			
	23.	    	General	  	68
	24.	    	Payment of Tax	  	68
	25.	    	Compliance	  	68
	26.	    	Taxation Claims Reliefs and Liabilities	  	69

					
	27.	    	Corporation Tax/Capital Allowances	  	69
	28.	    	Close Companies	  	70
	29.	    	Tax Avoidance	  	70
	30.	    	Value Added Tax	  	70
	31.	    	Share Schemes/Restricted Securities	  	70
	32.	    	International	  	70
	33.	    	Non-Arm’s Length Transactions	  	71
	34.	    	Groups of Companies	  	71
	35.	    	Stamp Duties	  	71
	36.	    	Group Payment Arrangements	  	71
		
	Schedule 7 Limitation of Seller’s liability	  	72
			
	1.	    	General limitations	  	72
	2.	    	Quantum	  	72
	3.	    	Time limits	  	73
	4.	    	Conduct of Claims	  	73
	5.	    	Recovery from Third Parties	  	75
		
	Schedule 8 Working Capital Adjustment	  	76
		
	Schedule 9 List of documents in the agreed form	  	79
		
	Schedule 10 Form of Working Capital Statement	  	80
		
	Schedule 11 Transitional Services	  	82

 THIS AGREEMENT is made the 3rd day of November 2008  
 BETWEEN 
  

	(1)	Esterline Technologies Limited, (registered in England with number 03837209) whose registered office is at Mitre House, 160 Aldersgate Street, London EC1A 4DD (the
“Seller”); 

  

	 (2)
	 Esterline Technologies Corporation, a company incorporated in the State of Delaware, USA whose principal
office is at City Centre Bellevue, 500 108th Avenue NE, Suite 1500, Bellevue, WA 98004, USA (the “Seller’s Guarantor”);

  

	(3)	EMA Holdings UK Limited, (registered in England with number 4600860) whose registered office is at PO BOX 36, 2 New Star Road, Leicester, Leicestershire LE4 9JQ (the
“Purchaser”); and 

  

	(4)	Ametek, Inc., a company incorporated in the State of Delaware, USA whose principal office is at 37, North Valley Road, Building 4, Paoli, PA 19301, USA (the
“Purchaser’s Guarantor”). 

 RECITALS 
  

	(A)	Details of Muirhead Aerospace Limited (“Muirhead”), Advanced Input Devices (UK) Limited (“AIDL”) and Norcroft Dynamics Limited
(“Norcroft”) are set out in Parts 1, 2 and 3 of Schedule 1. 

  

	(B)	Muirhead is the beneficial owner of the entire issued share capital of AIDL and the legal and beneficial owner of the entire issued share capital of Norcroft.

  

	(C)	The diagram showing the Seller’s group structure at Completion is set out in Part 4 of Schedule 1. 

  

	(D)	The Seller has agreed to sell the Shares to the Purchaser and the Purchaser has agreed to purchase the Shares on and subject to the terms and conditions of this Agreement.

  

	(E)	The Seller’s Guarantor has agreed to guarantee the obligations of the Seller under this Agreement. 

  

	(F)	The Purchaser’s Guarantor has agreed to guarantee the obligations of the Purchaser under this Agreement. 

 NOW IT IS AGREED as follows:  
  

	1.	Definitions and Interpretation 

 Defined
terms 
  

	1.1	In this Agreement: 

 “Accounts” means the
audited financial statements of each Company as at the relevant Balance Sheet Date (comprising a balance sheet, profit and loss account, notes, auditors’ and directors’ reports and a cashflow statement). Copies of the Accounts have been
initialled by or on behalf of each of the Parties for the purpose of identification; 
 “Acquiror’s Business” means a
business operated by any company excluded from clause 8.1 by reason of clause 8.3, to the extent that such business is or may in any way be in competition with all or any part of the Business; 
  

 1 

 “Actual Borrowing Amount” means the aggregate amount necessary to repay in full all
External Borrowings of the Companies outstanding as of the Completion Date; 
 “Actual Cash Balance” means the amount of the
Cash at 11.59pm on the day immediately preceding the Completion Date; 
 “Actual Working Capital” means the adjusted working
capital of the Companies as shown in the Working Capital Statement as agreed or determined pursuant to Schedule 8; 
 “Affiliate” means in relation to any body corporate from time to time (i) a parent undertaking of such body corporate; or (ii) a subsidiary undertaking of such body corporate or of any such parent undertaking;

 “AID Inc” means Advanced Input Devices Inc, a company incorporated in the State of Delaware, USA whose principal office
address is at Coeur d’Alene, Idaho, USA; 
 “Agreement” means (subject to sub-clause 18.1 (This Agreement)) this
Agreement including the Recitals and Schedules, but not the Tax Deed; 
 “Balance Sheet Date” means 31 October 2007 in
relation to AIDL and 26 October 2007 in relation to Muirhead and Norcroft; 
 “Business” means the business of the
Companies at the date of Completion; 
 “Business Day” means a day (other than a Saturday or Sunday) when banks are open for
business in the City of London; 
 “Cash” means the aggregate fair market value of any cash, bank deposits or cash
equivalents or derivative instruments owned by any Company expressed in pounds sterling, and taking into account any cheques that have been received by any Company (as listed in the schedule in the agreed form) and any outstanding but unpaid cheques
issued by any Company, but excluding any amount taken into consideration in calculating the Inter Company Receivables, less the amount included in the balance sheets contained in the Accounts in respect of customer deposits or prepayments;

 “CAA” means the Capital Allowances Act 2001; 
 “CA 85” means the Companies Act 1985; 
 “Charges” means (a) the charge over 3,581,565 shares in Muirhead in favour of Wachovia Bank (representing 65% of the issued share capital) in accordance with an agreement dated 29 May 2007;
and (b) the charge over 65 shares in AIDL in favour of Wachovia Bank in accordance with an agreement dated 11 June 2003; 
 “Commercial Information” means all information which belongs to the Companies or is used exclusively by the Companies for the purposes of the Business (or any aspect of it); 
 “Companies” means Muirhead, AIDL and Norcroft and each of them is a “Company”; 
 “Company Expenses” means collectively, the amount of the unpaid fees or expenses or bonuses (other than Retention Bonuses and Incentive
Bonuses) that have been or will be incurred by the Companies on or prior to the Completion Date (whether payable before or after Completion) on behalf of the Companies, the Seller, and/or any member of the Retained Group in connection with the
preparation, negotiation and execution of this Agreement, the consummation or performance of any of the transactions contemplated by this Agreement including, without limitation, the fees and expenses of any broker, investment banker or financial
advisor, and any legal, accounting and consulting fees and expenses; 
  

 2 

 “Competent Authority” means (i) any person (whether autonomous or not) having legal
and/or regulatory authority and/or enforcement powers; (ii) any court of law or tribunal in any jurisdiction; and/or (iii) any Taxation Authority; 
 “Completion” means completion of the sale and purchase of the Shares pursuant to this Agreement; 
 “Completion Date” means the date of Completion; 
 “Completion Tax Statement” has the meaning
given to it in the Tax Deed; 
 “Connected Person” means a person connected (within the meaning of section 839 TA 88) with
the Seller or with any of the directors (or any former director) of either Company; 
 “Consideration” means the
consideration payable for the Shares pursuant to Clause 3 (Consideration); 
 “Deeds of Assignment” means the agreed
form deeds of assignment between (a) Muirhead and the Seller’s Guarantor, (b) AIDL and AID Inc and (c) AIDL and the Seller’s Guarantor in relation to the assignment of the ‘Muirhead’, ‘Traxball’ and
‘Traxsys’ trade marks; 
 “Disclosed” means fairly disclosed (with sufficient details to identify the nature and
scope of the matter disclosed and the specific warranty or warranties to which it relates) by the Disclosure Letter (and “Disclosure” shall be construed accordingly); 
 “Disclosure Letter” means the letter described as such, dated as of the date of this Agreement and addressed by the Seller to the
Purchaser; 
 “Employee Options” means the share options held by any employee of any Company (including Graham Payne) in
respect of shares in any member of the Retained Group; 
 “Encumbrance” means any interest or equity of any person
(including any right to acquire, option or right of pre-emption or conversion) or any mortgage, charge, pledge, lien, assignment, hypothecation, security interest, title retention or any other security agreement or arrangement, or any agreement to
create any of the above; 
 “Environment”, “Environment Agreement”, “Environment Law” and
“Environment Liability” are as defined in paragraph 8 of Part 1 of Schedule 6 (Environment); 
 “ERA” means the Employment Rights Act 1996; 
 “Esterline Reorganisation” means the reorganisation
of the Retained Group of companies which occurred prior to Completion as described in the step plan extracts of which are set out in the document in the agreed form entitled “Esterline UK Tax Restructuring” and dated 29 October 2008;

 “Estimated Working Capital” means £8,036,000 being the bona fide estimate of the amount of the Actual Working
Capital agreed between the Seller and the Purchaser at Completion as set out in the schedule in agreed form; 
 “Existing
Customer” means any person who at any time during the 12 months preceding Completion shall have been a customer of a Company; 
 “Existing Use” is as defined in paragraph 22 of Part 1 of Schedule 6 (Properties); 
 “External Borrowings” means the aggregate of the amounts (if any) of all outstanding borrowings and outstanding indebtedness in the nature of borrowings of any Company, including without limitation any bank debit balances,
bonds, notes, loan stock, debentures or 
  

 3 

 other debt instruments, any overdraft or finance lease and also accrued interest on the foregoing items
and any premiums, fees, penalties, expenses and other amounts related thereto, but excluding ordinary trade credit and also excluding any amount taken into consideration in calculating the Inter-Company Payables and also excluding any amount owing
from one Company to another Company; 
 “FA” means Finance Act; 
 “Financial Year” means a financial year within the meaning of section 390 Companies Act 2006; 
 “FRS” means a financial reporting standard in force at the date of this Agreement as issued by the Accounting Standards Board Limited;

 “Harm” and “Hazardous Matter” are as defined in paragraph 8 of Part 1 of Schedule 6
(Environment); 
 “Incentive Bonus” means any and all bonuses payable by any Company to any officers, employees (in
each case excluding Graham Payne) or independent contractors pursuant to any bonus scheme relating to the financial performance of any Company for all periods ending on or prior to the Completion Date but excluding the Retention Bonuses; 

“Incentive Bonus Payment Date” means a date on or around 15 December 2008; 
 “Indemnities” means the indemnities given by the Seller to the Purchaser as set out in clauses 6.5 and 6.6 and “Indemnity”
shall be construed accordingly; 
 “Intellectual Property Rights” is as defined in paragraph 18 of Part 1 of Schedule 6
(Intellectual Property Rights); 
 “Inter-Company Payables” means the aggregate of the amounts (if any) owing,
including in respect of interest accrued on all such amounts, as at the opening of business on the Completion Date from the Companies to members of the Retained Group, excluding the Ordinary Trading Items, expressed in pounds sterling; 

“Inter-Company Receivables” means the aggregate of the amounts (if any) owing, including in respect of interest accrued on all such
amounts, as at the opening of business on the Completion Date from members of the Retained Group to the Companies, excluding the Ordinary Trading Items, expressed in pounds sterling; 
 “IT Assignment Documents” means the documents in the agreed form for the transfer of certain software to AIDL from Infor; 
 “IT Contracts”, “IT Services” and “IT Systems” are as defined in paragraph 19 of Part 1 of Schedule 6
(Information technology and telecommunications); 
 “IT(EP)A” means the Income Tax (Earnings and Pensions) Act 2003;

 “Know How” is as defined in paragraph 18 of Part 1 of Schedule 6 (Intellectual Property Rights); 
 “Lease” means in relation to any Property, if applicable, the lease under which the Property is held by any Company; 
 “Letting Documents” means, in relation to any Property, leases, underleases, tenancies, licences or other agreements or arrangements
giving rise to rights of occupation (in each case as amended) to which the Property is subject; 
  

 4 

 “Licences In” and “Licences Out” are as defined in paragraph 18 of Part
1 of Schedule 6 (Intellectual Property Rights); 
 “Litigation” means any actual or prospective proceedings, whether
judicial, administrative, tribunal, arbitral, criminal or similar and whether or not subject or intended to be subject to Alternative Dispute Resolution techniques; 
 “Losses and Expenses” means losses, damages, liabilities, claims, demands, costs and expenses and all reasonably incurred legal and other professional fees (including, for the avoidance of doubt in
relation to clauses 6.5(b), 6.5(c) 6.5(d) and 6.5(g) any employer’s Class 1 national insurance or other Tax); 
 “Ordinary
Trading Items”: means ordinary trade indebtedness outstanding at Completion and relating to the period up to Completion only, between the Companies and members of the Retained Group, but excluding management charges and other administrative
charges or recharges payable by the Companies (which shall be paid in full prior to Completion); 
 “Other Property” is as
defined in paragraph 8 of Part 1 of Schedule 6 (Environment); 
 “Parties” means the Purchaser, the Purchaser’s
Guarantor, the Seller and the Seller’s Guarantor (and “Party” shall be construed accordingly); 
 “Payne
Compromise Agreement” means the agreed form compromise agreement between Muirhead and Graham Payne to be delivered by the Seller duly executed on Completion; 
 “Pension Schemes” means agreements or arrangements (whether legally enforceable or not) for the payment of any pensions, allowances, lump sums or other like benefits on retirement for the benefit of
any present or former director, officer or employee of any Company or for the benefit of the dependants of any such persons; 
 “Permits” is as defined in paragraph 8 of Part 1 of Schedule 6 (Environment); 
 “Permitted
Business” means: 
  

	 	(a)	the existing business of Mason Electric in relation to the manufacture and sale of cursor control devices (other than track balls), save that Mason may not sell such devices to
Existing Customers in respect of applications met by products supplied (or to be supplied) under existing contracts with those Existing Customers by AIDL (but, for the avoidance of doubt, where AIDL has an existing contract with an Existing Customer
this prohibition will not prevent Mason Electric from selling such devices to such Existing Customer in relation to other applications); 

  

	 	(b)	the existing business of BVR Technologies (“BVR”) in relation to the manufacture and sale of rotary actuation devices and angular position sensors (including but not
limited to linear actuation or rotary actuation products that utilise BVR’s custom precision planetary gearbox in-house design and manufacturing capability and/or BVR’s patented Hall effect digital sensing technologies) for customers other
than Existing Customers of the motion business of Muirhead, provided that: 

  

	 	(i)	such business may not manufacture or supply products for the downhole/oil and gas industry (except to its existing customer Moog); and 

  

	 	(ii)	(subject to sub-paragraph (i)) BVR may manufacture and sell products to any of the following existing customers of BVR in North America only, namely (1) BAE, (2) Hamilton
Sundstrand, (3) Pratt Whitney, (4) Boeing and (5) Parker Hannifin, provided that BVR may not sell products meeting applications met by products supplied (or to be supplied) under existing contracts with such customers by any Company;
and 

  

 5 

	 	(c)	any motion control business with sales in excess of US$100,000,000 that may be acquired by any member of the Retained Group from a third party on arm’s length terms.

 “Proceedings” means any proceeding, suit or action (including arbitration) arising out of or in connection
with this Agreement; 
 “Product” is as defined in paragraph 14 of Part 1 of Schedule 6 (Trading); 
 “Properties” means the properties of which short particulars are set out in Schedule 2 (Properties) and the expression
“Property” shall mean, where the context so admits, any one or more or any part of such properties; 
 “Provisional
Consideration” means the provisional consideration payable for the Shares, as specified in clause 3.1; 
 “Purchaser’s
Solicitors” means CMS Cameron McKenna LLP of Mitre House, 160 Aldersgate Street, London EC1A 4DD (Ref. BHH/DNHE/0Z4060.00050); 
 “Regulatory Requirements” means any applicable requirement of law, the UK Listing Authority or the London Stock Exchange plc, or of any person who has regulatory authority which has the force of law; 
 “Releases” means the agreed form deeds of release by Wachovia Bank in respect of the Charges; 
 “Relief” has the meaning given to it in the Tax Deed; 
 “Remediation Action” is as defined in paragraph 8 of Part 1 of Schedule 6 (Environment); 
 “Retained Group” means the Seller and its Affiliates (excluding the Companies) from time to time; 
 “Retained Information” means any financial information and/or Tax information relating to the Companies (and shall include details of policies of insurance which any Company had the benefit of) which following Completion
remains in the possession or control of the Seller or the Retained Group (but not of the Purchaser); 
 “Retention Bonuses”
means the retention bonuses payable to the Selected Employees in relation to the successful completion of the sale by the Seller of the Companies in accordance with the terms of the Retention Bonus Letters; 
 “Retention Bonus Letters” means the letters between the Seller’s Guarantor, Muirhead and each Selected Employee dated on or about
11 July 2008 in relation to the payment of the Retention Bonuses including the timing and amount of any such payments, as amended, copies of which have been Disclosed; 
 “Retention Bonus Payment Date” means a date on which the Retention Bonuses are due to be paid in accordance with the Retention Bonus
Letters; 
 “Selected Employees” means Dawn Salisbury, Stephen Scaife, Pradeep Sharma, Stephen Wells, Michael Baker, Simon
Coverdale, Wendy Stansfield, Mark Butler, Anthony Sawyer, Michael Robinson and Robert Furmsten; 
 “Seller’s Group”
means the Retained Group together with the Companies; 
 “Seller’s Solicitors” means Taylor Wessing LLP of
Carmelite, 50 Victoria Embankment, London EC4Y ODX (Ref: DNK/MPB/EST-9-10); 
  

 6 

 “Service Termination Dates” means the various dates set out in Schedule 11 for the
termination of the Transitional Services; 
 “Shares” means the 5,510,101 fully-paid issued ordinary shares in the capital
of Muirhead; 
 “SSAP” means a statement of standard accounting practice in force at the date of this Agreement as adopted
by the Accounting Standards Board Limited; 
 “TA 88” means the Income and Corporation Taxes Act 1988;  

“Taxation” or “Tax” has the meaning given to it in the Tax Deed;  
 “Taxation Authority” has the meaning given to it in the Tax Deed;  
 “Taxation Statute” has the meaning given to it in the Tax Deed; 
 “Tax Deed” means the deed in the agreed form containing certain Taxation covenants and indemnities between the Seller and the Purchaser;

 “Tax Warranties” means the warranties set out in Part 2 of Schedule 6 (Taxation Warranties);  

“TCGA” means the Taxation of Chargeable Gains Act 1992; 
 “TMA” means the Taxes Management Act 1970;  
 “Trade Union” is as defined in section 1 TULRCA; 
 “Transaction Document”
means this Agreement, the Tax Deed or any document or agreement entered into pursuant to or in connection with this Agreement; 
 “Transitional Services” means the transitional services to be provided or procured by the Seller to the Purchaser and/or the Companies as set out in clause 5 and Schedule 11; 
 “Traxsys Supply Agreement” means the agreement in the agreed form between AID Inc and AIDL in relation to the supply of certain products
by AIDL to AID Inc following Completion; 
 “TULRCA” means the Trade Union and Labour Relations (Consolidation) Act 1992;

 “TUPE” means the Transfer of Undertakings (Protection of Employment) Regulations 2006 (and, where the context so
requires, the 1981 Regulations defined in those regulations); 
 “UK GAAP” means FRSs, SSAPs, the legal principles
set out in such of the regulations referred to in sections 396 and 404 Companies Act 2006 as apply, rulings and abstracts of the Urgent Issues Task Force of the Accounting Standards Board Limited and guidelines, conventions, rules and procedures of
accounting practice in the United Kingdom which are regarded as permissible by the Accounting Standards Board Limited; 
 “US
Dollar” or “USD” means the lawful currency of the United States of America;  
 “US
GAAP” means United States generally accepted accounting principles; 
 “US GAAP Accounts” means the monthly
management reports in the agreed form as at 30 September 2008 (and for the 11 month period then ended); 
 “VAT” means
value added tax or any equivalent Tax that is levied on the supply of goods or services in any jurisdiction; 
 “VATA” means
the Value Added Tax Act 1994; 
  

 7 

 “Warranties” means the warranties set out in clause 6 (Warranties) and Schedule 6
(Warranties); and 
 “Working Capital Statement” means the working capital statement in the form set out in Schedule
10 as referred to and prepared in accordance with Schedule 8 (Working Capital Adjustment). 
 Interpretation 

 

	1.2	In interpreting this Agreement: 

  

	 	1.2.1	reference to any document as being “in the agreed form” shall mean that it is in the form agreed between the Seller and the Purchaser and signed for the purposes of
identification by or on behalf of the Seller and the Purchaser or identified as being in the agreed form by an email between or on behalf of the Seller and the Purchaser. 

  

	 	1.2.2	where any statement is qualified as being limited by any person’s knowledge (for example, by using expressions such as “so far as he is aware”), the statement
shall be deemed to be given to the best of his knowledge, information and belief after making reasonable enquiries including, but not limited to, enquiries of Graham Payne, in relation to Schedule 6 parts 1 to 22, Pradeep Sharma in relation to parts
1 to 7, 10, 13 and 23 to 27, Phillip Bourne (for AIDL only) in relation to parts 1 to 7, 10, 13, 16 to 17 and 19 to 22, Dawn Salisbury (for Muirhead only) in relation to parts 8 to 10, Mick Robertson (for Traxsys only) in relation to parts 1 to 9,
Robert Furmston (for Traxsys only) in relation to parts 1 to 8 and 10, both Tony Sawyer and Mark Baker (Traxsys only) in relation to parts 8 to 22, both Simon Covedale and Stephen Wells (Muirhead only) in relation to parts 11 and parts 14 to 15,
Wendy Stansfield in relation to parts 16 to 17 and both Steven Scaife and Mike Butler (Muirhead only) in relation to part 18. 

  

	 	1.2.3	the table of contents and headings and sub-headings are for convenience only and shall not affect the interpretation of this Agreement. 

  

	 	1.2.4	unless the context otherwise requires, words denoting the singular shall include the plural and vice versa and references to any gender shall include all other genders. References
to any person shall include natural persons, bodies corporate, unincorporated associations, partnerships, governments, governmental agencies and departments, statutory bodies or other entities, in each case whether or not having a separate legal
personality, and shall include such person’s successors. 

  

	 	1.2.5	the words “other”, “include” and “including” shall not connote limitation in any way. 

  

	 	1.2.6	references to Recitals, Schedules, clauses and sub-clauses are to (respectively) recitals to, schedules to, and clauses and sub-clauses of, this Agreement (unless otherwise
specified) and references within a Schedule to paragraphs are to paragraphs of that Schedule (unless otherwise specified). 

  

	 	1.2.7	references to any statute, statutory provision, directive of the Council of the European Union (whether issued jointly with any other person or under any other name) or other
legislation include a reference to that statute, statutory provision, directive or legislation as amended, extended, re-enacted, consolidated or replaced from time to time (whether before or after the date of this Agreement) and include any order,
regulation, instrument or other subordinate legislation made under the relevant statute, statutory provision, directive or legislation and in force at the relevant time. 

  

	 	1.2.8	words and expressions used in this Agreement that are defined in: 

  

 8 

	 	(a)	provisions of the Companies Act 2006 in force at the date of this Agreement shall be read as having those meanings; and 

  

	 	(b)	provisions of CA 85 shall be read as having those meanings as long as those provisions are in force, and shall then be read as having the meanings given to them in the Companies Act
2006. 

  

	 	1.2.9	words and expressions defined in the Tax Deed shall (to the extent they are not inconsistent with this Agreement) bear those meanings respectively in this Agreement.

  

	 	1.2.10	references to any English legal term for any action, remedy, method of judicial proceeding, legal document, legal status, court, organisation, body, official or any legal concept,
state of affairs or thing shall in respect of any jurisdiction other than England be deemed to include that which most nearly approximates in that jurisdiction to the English legal term. 

  

	 	1.2.11	any reference to “writing” or “written” shall include faxes, and any legible reproduction of words delivered in permanent and tangible form (but
not email). 

  

	 	1.2.12	except as specified in Schedule 10, any amount determined or expressed in one currency (the “First Currency”) shall, to the extent that it requires in whole or in
part to be expressed in pounds sterling (or any other currency) in order to give due effect to this Agreement, be deemed for that purpose to have been converted into the relevant currency at the close of business on the Business Day immediately
preceding the Completion Date. Subject to any applicable legal requirements governing conversions into that currency, the rate of exchange shall be the spot rate for the purchase of that other currency with the First Currency at the time of the
deemed conversion as shown in the final edition of the Financial Times published on the following day. 

  

	 	1.2.13	references to times of the day are (unless otherwise expressly provided) to London time and references to a day are to a period of 24 hours running from midnight on the previous
day. 

  

	2.	Sale and purchase 

 Obligation to sell and
purchase 
  

	2.1	Subject to the terms of this Agreement, the Seller shall sell all the Shares to the Purchaser (together with all rights attaching to them at the date of this Agreement); and the
Purchaser shall purchase the Shares accordingly. 

 Dividends and distributions 
  

	2.2	The Purchaser shall be entitled to receive all dividends and distributions (whether of income or capital) declared, paid or made by either Company on or after the date of this
Agreement. 

 Sale of all Shares 
  

	2.3	The Purchaser shall not be obliged to complete the purchase of any of the Shares unless the purchase of all the Shares is completed simultaneously. 

 Implied covenants for title 
  

	2.4	The Seller covenants that it has the right to transfer the legal and beneficial title to the Shares held by it to the Purchaser in accordance with this Agreement and is disposing of
them free from all Encumbrances. 

  

 9 

 Part 1 of the Law of Property (Miscellaneous Provisions) Act 1994 shall not apply to any disposition made
under or pursuant to this Agreement. 
 Waivers of pre-emption 
  

	2.5	The Seller waives all rights of pre-emption or similar rights over any of the Shares conferred on it either by the articles of association of Muirhead or in any other way.

  

	3.	Consideration  

 Consideration 
  

	3.1	The consideration for the sale of the Shares payable on Completion shall be £40,015,000 (the “Provisional Consideration”). The consideration shall be adjusted
after Completion as provided in clause 3.2 below and in clause 12 of the Tax Deed. 

  

	3.2	The Provisional Consideration shall be adjusted after Completion as follows: 

  

	 	3.2.1	if the Actual Working Capital is less than Estimated Working Capital, the Seller shall pay to the Purchaser the amount of the deficiency; 

  

	 	3.2.2	if the Actual Working Capital is greater than Estimated Working Capital, the Purchaser shall pay to the Seller the amount of the excess, 

 in either case within 10 Business Days after the date on which the Working Capital Statement has been agreed or settled. 
 Reduction in consideration 
  

	3.3	Any payment made by the Seller in respect of a breach of the Warranties or under the Tax Deed or any other payment made by the Seller pursuant to this Agreement shall (so far as
possible) be deemed to reduce the price paid for the Shares under this Agreement by a matching amount. Any payment made by the Purchaser to the Seller under this Agreement (other than any payments made pursuant to Schedule 11) shall (so far as
possible) be deemed to increase the price paid for the Shares under this Agreement by a matching amount. 

  

	4.	Completion  

 Completion 
  

	4.1	Completion shall take place at the offices of the Purchaser’s Solicitors (or wherever else the Parties agree in writing) upon execution and release by all parties of this
Agreement. 

  

	4.2	At Completion, the Parties shall perform their respective Completion obligations set out in Schedule 5 (Completion Obligations). Completion shall be effective as of 12.01am
on the Completion Date. 

 Effect of Completion 
  

	4.3	Notwithstanding Completion: 

  

	 	4.3.1	each provision of this Agreement (and any other document referred to in it) not performed at or before Completion but which remains capable of performance; 

 

	 	4.3.2	the Warranties; and 

  

	 	4.3.3	all covenants and other undertakings contained in or entered into pursuant to this Agreement 

  

 10 

 will remain in full force and effect and (except as otherwise expressly provided) without limit in time.

 Pending registration 
  

	4.4	The Seller declares that for so long as it remains the registered holder of the Shares after Completion, the Seller will: 

  

	 	4.4.1	hold those Shares and all dividends and other distributions in respect of them, and all other rights arising out of or in connection with them, in trust for the Purchaser; and

  

	 	4.4.2	at all times deal with and dispose of those Shares, and all such dividends, distributions and rights attaching to them, as the Purchaser may direct. 

  

	4.5	The Seller shall procure that for so long as AID Inc remains the registered holder of the issued share capital of AIDL after completion, it shall procure that AID Inc shall:

  

	 	4.5.1	hold those shares and all dividends and distributions in respect of them, and all other rights arising out of them, in trust for the Companies; and 

  

	 	4.5.2	at all times deal with and dispense of such shares as the Company may direct.  

  

	 	Company	records etc. 

  

	4.6	During the six years following Completion, the Seller will or will procure that the Retained Group will maintain in safekeeping and on request promptly provide the Purchaser with
all Retained Information reasonably requested by the Purchaser. The Seller and the Purchaser undertake at all times to provide the other promptly on request with all reasonable information known to the Seller or the Purchaser (as the case may be) in
relation to the Company if it is required for the purposes of complying with Regulatory Requirements. 

  

	5.	Transitional Services and Retention Bonus Payments 

  

	5.1	In accordance with the provisions of Schedule 11, the Seller agrees to provide or procure the provision of each of the Transitional Services to the Companies from the Completion
Date until the relevant Service Termination Date. 

  

	5.2	The Seller shall provide or procure (but as regards persons outside the Retained Group, only so far as it is able) the provision of the Transitional Services using reasonable skill,
diligence and care, to a standard equivalent to the standard to which such services were supplied by the Retained Group to the Companies in the six (6) month period immediately prior to the date of this Agreement. 

  

	5.3	The Purchaser shall procure that the Purchaser and/or the relevant Company shall provide such information, decisions and data as the Seller may reasonably require for the purposes
of the provision of the Transitional Services. 

  

	5.4	The Seller shall treat as confidential and shall procure that each member of the Retained Group (and each of its employees) treats as confidential all information obtained as a
result of performing the Transitional Services and the Seller hereby agrees that no member of the Retained Group (and any of its employees) shall acquire any rights in respect of any Intellectual Property generated during the hosting of the website
as part of the Transitional Services. 

  

	5.5	The Seller shall, in performing the Transitional Services, and the Company shall, in receiving the Transitional Services, comply in all respects with applicable data protection
legislation. 

  

	5.6	The Seller shall not have any liability whether in contract or tort (save for death or personal injury) for any act or omission in the provision of the Transitional Services to the
Purchaser 

  

 11 

 and/or the relevant Company save to the extent that any loss or damage suffered by the Purchaser is due
to fraud, wilful misconduct or gross negligence by the Seller or any member of the Retained Group. 
  

	5.7	Each Party shall allow the other Parties reasonable access on reasonable prior notice to any relevant documentation and personnel to the extent reasonably required for such Party to
complete its financial year end process. 

  

	5.8	The Seller shall, five (5) Business Days before each Retention Bonus Payment Date, pay to the Company or procure the payment to the Company of the relevant amount of the
Retention Bonuses to be paid on that date to each Selected Employee who is an employee of the relevant Company on the Retention Bonus Payment Date (and any employer’s class 1 national insurance contributions on such amounts). At the request of
the Seller the Purchaser will confirm which Selected Employees are so employed on the date of the request. 

  

	5.9	Subject to receipt of payment under clause 5.8, the Purchaser shall procure that the relevant Company shall: 

  

	 	5.9.1	pay the amount of the Retention Bonus (as notified by the Seller) to each relevant Selected Employee on the Retention Bonus Date (net of amounts withheld in accordance with clause
5.9.2); and 

  

	 	5.9.2	operate PAYE and account for any other Tax deductions (including any employee’s national insurance contributions) and related employer’s Class 1 national insurance
applicable to such Retention Bonuses to the relevant Taxation Authority within the period required by law. 

  

	5.10	The Seller shall, five (5) Business Days before the Incentive Bonus Payment Date, pay to the Purchaser or procure the payment to the Purchaser of the relevant amount of the
Incentive Bonuses to be paid on that date to each person (other than Graham Payne) entitled to receive an Incentive Bonus (and any employer’s class 1 national insurance contributions on such amounts). 

  

	5.11	Subject to receipt of payment under clause 5.10, the Purchaser shall procure that the relevant Company shall: 

  

	 	5.11.1	pay the amount of the Incentive Bonus (as notified by the Seller) to each relevant recipient on the Retention Bonus Date (net of amounts withheld in accordance with clause 5.11.2);
and 

  

	 	5.11.2	operate PAYE and account for any other Tax deductions (including any employee’s national insurance contributions) and related employer’s Class 1 national insurance
applicable to such Incentive Bonuses to the relevant Taxation Authority within the period required by law. 

  

	6.	Warranties and undertakings 

  

	6.1	The Seller warrants and undertakes to the Purchaser in the terms set out in Schedule 6 (Warranties) in relation to each Company (and references in the Warranties to “the
Company” shall be construed as a separate reference to each of the Companies). Each of the Warranties set out in the separate paragraphs of Schedule 6 (Warranties) shall be separate and independent and (except as expressly otherwise
provided) shall not be limited by reference to any other Warranty or by anything in this Agreement, the Disclosure Letter or the Tax Deed. 

 Investigation by Purchaser 
  

	6.2	None of the Warranties shall be deemed in any way modified or discharged by reason of any investigation or inquiry made or to be made by or on behalf of the Purchaser. No
information relating to the Companies that has not been Disclosed but of which the Purchaser has 

  

 12 

 knowledge (whether actual or constructive) shall prejudice any claim which the Purchaser shall be
entitled to bring or shall operate to reduce any amount recoverable by the Purchaser under this Agreement. 
 Information supplied by
the Company 
  

	6.3	The Seller undertakes to the Purchaser to waive any and all claims which the Seller might otherwise have against the Companies or their respective officers, employees, or
consultants or any of them in respect of any information supplied to the Seller by or on behalf of a Company in connection with the Warranties, the Tax Deed and/or the information Disclosed. 

 Reliance 
  

	6.4	The Seller accepts that the Purchaser has entered into this Agreement upon the basis of the Warranties being true and accurate. 

 Indemnities 
  

	6.5	The Seller hereby agrees to indemnify and hold the Purchaser harmless in relation to any and all Losses and Expenses sustained, incurred, paid or required to be paid by the
Purchaser or any Company which arise out of, relate to or result from: 

  

	 	(a)	the existence of any External Borrowings or Inter-Company Payables or Company Expenses as at the Completion Date and not included within the Working Capital Statement or the
Completion Tax Statement; and/or 

  

	 	(b)	the exercise of the Employee Options, except where recovery has been made from the relevant employee exercising an Employee Option or the relevant amount was included within the
Working Capital Statement or the Completion Tax Statement; and/or 

  

	 	(c)	except to the extent that payment has been made pursuant to clause 5.8 or 5.10, any Incentive Bonuses and any liability under the Retention Bonus Letters; and/or

  

	 	(d)	any liability to Graham Payne in respect of any Incentive Bonus or under the retention bonus letter between him, the Seller’s Guarantor and Muirhead dated 11 July 2008 (as
amended); and/or 

  

	 	(e)	the Esterline Reorganisation; and/or 

  

	 	(f)	(save for ordinary course costs and expenses associated with keeping a company dormant) any liability of Norcroft to any other person; and/or 

  

	 	(g)	any liability of any of the Companies under Section 75 of the Pensions Act 1995 to any Pension Scheme as a result of or pursuant to the obligations under the share sale
agreement between Silvermines Engineering Technology Limited, Silvermine Group pic, the Seller’s Guarantor and the Seller dated 23 September 1999; and/or 

  

	 	(h)	the provisions of Council Directives 77/187/EEC and 2001/23 EEC and any other applicable provision of law affecting the transfer of employees as a result of which transfer the
Purchaser or any Company has or will have at Completion a liability (whether actual, contingent or future) to provide an early retirement benefit which is not an old-age, invalidity or survivor’s benefit; and/or 

  

 13 

	 	(i)	any liability of the Companies arising out of any claim against any Company by either Liebherr – Aerospace Lindenberg GmbH or Bayern Chemie Gesellschaft fuer flugchemische
Antriebe GmbH in relation to the matters set out in paragraph 5 of the Disclosure Letter against the Warranty in paragraph 12.1 of Schedule 6. 

  

	6.6	The Seller will indemnify and hold harmless the Purchaser and any person who is connected or associated with the Purchaser (as those terms are defined in sections 38 to 51 Pensions
Act 2004) in full against any and all Losses and Expenses sustained, incurred, paid or required to be paid by any such person relating to the Seller’s Pension Scheme and/or any other occupational pension scheme (as defined in section 1 Pension
Schemes Act 1993) established or operated by a Company and arising under or in respect of any contribution notice or financial support direction made by the Pensions Regulator (under sections 38 to 51 Pensions Act 2004). 

 IT Assignment Documents 
  

	6.7	The Seller undertakes to pay any outstanding amounts due to procure the relevant software assignment to AIDL pursuant to the IT Assignment Documents in accordance with the terms of
such documents. 

  

	7.	Limitation of Seller’s liability  

 Limitations on liability 
  

	7.1	The Seller’s liability in respect of any claim shall be limited as provided in Schedule 7 (Limitation of Seller’s liability) provided that such limitations shall
not apply in relation to the Warranties set out in paragraphs 1 (Power to contract), 2.4 (Share capital of the Company) and 2.5 (Subsidiaries) of Part 1 of Schedule 6 (Warranties). 

 Exclusions from clause 7 
  

	7.2	Notwithstanding any other provision of this Agreement, the provisions of this clause 7 and Schedule 7 (Limitation of Seller’s liability) shall not apply to any claim
made against the Seller in the case of any fraud, dishonesty, wilful misstatement or wilful omission by or on behalf of the Seller. 

  

	8.	Protection of goodwill and trade secrets  

 Covenants 
  

	8.1	As further consideration for the Purchaser agreeing to purchase the Shares on the terms contained in this Agreement and with the intent of assuring to the Purchaser the full benefit
and value of the goodwill and connections of the Companies and as a constituent part of the sale of the Shares, the Seller shall not (and shall procure that none of the Affiliates of the Seller’s Guarantor shall) directly or indirectly:

  

	 	8.1.1	until 3 years after Completion, carry on or be employed, engaged, concerned, interested or in any way assist in the conduct of any business which is or may in any way be in
competition with all or any part of the Business provided that nothing in this sub-clause 8.1.1 shall prevent the Seller or any of the Affiliates of the Seller’s Guarantor from: 

  

	 	(a)	being engaged in any Permitted Business; or 

  

	 	(b)	holding for investment purposes only not more than three per cent of any class of the issued share or loan capital of any company quoted on a recognised investment exchange (as
defined in the Financial Services and Markets Act 2000); 

  

 14 

	 	8.1.2	until 3 years after Completion: 

  

	 	(a)	canvass, solicit or approach or cause to be canvassed, solicited or approached (in relation to a business which may in any way compete with all or part of the Business, but
excluding any Permitted Business) any Existing Customer; or 

  

	 	(b)	compete against any Company in any open bid or tender process that any such Company has identified as at the date of Completion and intends to participate in, provided that Mason
Electric may compete against AIDL in any relevant open bids or tenders for or relating to: 

  

	 	(i)	Lockheed-Martin VH71; and/or 

  

	 	(ii)	Gulfstream 5-50 upgrade programme; or 

  

	 	(c)	compete against any Company for any other opportunity that (under the principles currently operated by the Seller’s Group) would have been allocated to that Company;

  

	 	8.1.3	until 3 years after Completion, offer employment to or offer to conclude any contract of services with any employees holding executive or managerial posts or any key technical or
sales personnel of any Company or procure or facilitate the making of such an offer by any person, firm or company or entice or endeavour to entice any such employees of any Company to terminate their employment with that Company Provided always
that this sub-clause 8.1.3 shall only apply in relation to persons who were so employed at Completion and who were still so employed at the time of the relevant breach of this sub-clause 8.1.3; 

  

	 	8.1.4	until 3 years after Completion, employ any employees holding executive or managerial posts or any key technical or sales personnel of any Company or procure or facilitate such
employment by any person, firm or company at any time within 6 months after termination of their employment with the Company Provided always that this sub-clause 8.1.4 shall only apply in relation to persons who were so employed at Completion;

  

	 	8.1.5	until 3 years after Completion, procure or permit directly or indirectly Graham Payne to have any role in a Permitted Business or any Acquiror’s Business either as an employee,
consultant or a director; 

  

	 	8.1.6	at any time after Completion use as a trade or business name or mark, use as or include in a domain name for any web site, or carry on a business under a title containing the words
“Muirhead” or “Muirhead Avionics” or “Muirhead Aerospace” or “Traxsys” or “Traxball” or any other word(s) colourably resembling any such word; or

  

	 	8.1.7	at any time after Completion disclose to any person whatsoever or use in connection with any business (whether or not a Permitted Business) or any Acquiror’s Business (or
otherwise use to the detriment of any Company) or otherwise make use of, or through any failure to exercise all due care and diligence cause any unauthorised disclosure or use of, any Commercial Information which is confidential or in respect of
which a Company is bound by an obligation of confidence to a third party or which the Seller is prohibited under clause 12 (Confidentiality; announcements) from disclosing without the Purchaser’s consent, 

 in each case whether on the Seller’s or Affiliate’s own behalf or with or on behalf of any person except in accordance with a prior waiver
given by the Purchaser (which in the case of clause 8.1.4, shall not be unreasonably withheld). 
  

 15 

	8.2	Each undertaking contained in sub-clause 8.1 shall be read and construed independently of the other undertakings and as an entirely separate and severable undertaking.

  

	8.3	Except in relation to the restrictions contained in clauses 8.1.3, 8.1.4, 8.1.6 and 8.1.7 references in clause 8.1 to Affiliates of the Seller’s Guarantor shall exclude any
company which may acquire (including, for the avoidance of doubt, by way of a merger) the Seller’s Guarantor, and any Affiliate of such acquiror which is not (and since the date of this Agreement has never been) a member of the group comprising
the Seller’s Guarantor and its subsidiaries. 

 Severability of covenants 
  

	8.4	The undertakings in sub-clause 8.1 (Covenants) are considered by the Parties to be reasonable in all the circumstances, but if any one or more should for any reason be held
to be invalid, but would have been held to be valid if part of the wording were deleted, the undertakings shall apply with the minimum modifications necessary to make them valid and effective. 

 Information in the public domain 
  

	8.5	The restriction contained in sub-clause 8.1.7 (Covenants) shall not extend to any confidential or secret information that may come into the public domain otherwise than
through the default of the Seller or relevant Connected Persons. 

  

	9.	Termination  

 Accrued
liabilities 
  

	9.1	On termination, the rights and liabilities of the Parties that have accrued beforehand shall subsist. 

 Surviving provisions 
  

	9.2	Except as otherwise expressly provided, this clause and the following provisions of this Agreement shall survive termination, without limit of time: 

  

	 	9.2.1	clause 1 (Definitions and interpretation); 

  

	 	9.2.2	clause 6 (Warranties); 

  

	 	9.2.3	clause 7 (Limitation on Seller’s liability); 

  

	 	9.2.4	clauses 9 to 16 inclusive; and 

  

	 	9.2.5	clauses 18 to 25 inclusive. 

  

	10.	Third party rights 

  

	10.1	Nothing in this Agreement is intended to confer on any person any right to enforce any term of this Agreement which that person would not have had but for the Contracts (Rights of
Third Parties) Act 1999 except: 

  

	 	10.1.1	that the Companies’ officers, employees and consultants shall be entitled with the Purchaser’s prior written consent to enforce sub-clause 6.3 (Information supplied by
the Company); and 

  

	 	10.1.2	that the Companies shall be entitled to enforce clause 5 (Transitional Services); 

  

 16 

	    	and all other provisions of this Agreement necessary to give due effect to such rights, but this Agreement may be amended or varied by the Parties in any way, or terminated, in
accordance with its terms without any such person’s consent. 

  

	11.	Further assurance 

  

	11.1	The Seller or the Purchaser shall, from time to time on being required to do so by the other Party acting reasonably, promptly and at the cost and expense of the other Party do or
(so far as it is able) procure the doing of all such acts and/or execute or procure the execution of all such reasonable documents in a form satisfactory to the other Party as the other Party may reasonably consider necessary to give full effect to
this Agreement (or to such parts of it as remain operative after termination). 

  

	12.	Confidentiality; announcements  

 Prohibition on disclosure 
  

	12.1	Each of the Seller and the Seller’s Guarantor undertakes with the Purchaser, and each of the Purchaser and the Purchaser’s Guarantor undertakes with the Seller, to keep
confidential (except as expressly provided in this Agreement) at all times after the date of this Agreement, and not directly or indirectly reveal, report, publish, disclose or transfer or use for its own or any other purposes, any confidential
information received or obtained as a result of entering into or performing, or supplied by or on behalf of another Party in the negotiations leading to, this Agreement and which relates to: 

  

	 	12.1.1	the negotiations relating to this Agreement; 

  

	 	12.1.2	the subject matter and/or provisions of this Agreement; or 

  

	 	12.1.3	(in the Seller’s case) the Purchaser or the Purchaser’s Guarantor or (in the Purchaser’s case) the Seller or the Seller’s Guarantor. 

 Permitted disclosures 
  

	12.2	The prohibition in sub-clause 12.1 (Prohibition on disclosure) does not apply if: 

  

	 	12.2.1	the information was in the public domain before it was furnished to the relevant Party or, after it was furnished to that Party, entered the public domain otherwise than as a result
of (i) a breach by that Party of this clause or (ii) a breach of a confidentiality obligation by the discloser, where the breach was known to that Party; 

  

	 	12.2.2	disclosure is necessary in order to comply with Regulatory Requirements or to obtain tax or other clearances or consents from HM Revenue and Customs or other relevant Taxation
Authority; 

  

	 	12.2.3	disclosure is made pursuant to an announcement permitted under sub-clause 12.3; or 

  

	 	12.2.4	disclosure is made to such of the Party’s officers, employees, agents, consultants and professional advisers as are involved in the transactions contemplated by this Agreement
and is restricted to matters necessary for the proper performance of their duties or services in relation to those transactions 

 provided that any such information disclosable pursuant to sub-clause 12.2.2 shall be disclosed only to the extent required by Regulatory Requirements and (unless such consultation is prohibited by Regulatory Requirements) only after
consultation with the Purchaser or the Seller (as the case may be). 
  

 17 

 Announcements 
  

	12.3	Except as set out in clause 12.4, no Party shall make any formal press release or other public announcement in connection with any of the transactions contemplated by this Agreement
unless consent has been received from the other Parties (such consent not to be unreasonably withheld, delayed or conditioned). 

  

	12.4	Any Party shall be entitled to make any announcement required by any applicable Regulatory Requirements (provided that, unless such consultation is prohibited by Regulatory
Requirements, it is made only after consultation with the other Parties (as the case may be)). 

  

	13.	Assignment  

 Assignment by
Purchaser 
  

	13.1	Subject to clause 13.2, the Purchaser is permitted to assign the benefit of, and any of its rights under, this Agreement (including under the Warranties provided that no assignee
shall be entitled to greater damages or other compensation than that to which the Purchaser would have been entitled had it not assigned the benefit of the Warranty) together with any cause of action arising in connection with any of them to its
successor in title or, to any of its Affiliates. 

  

	13.2	If any assignee under clause 13.1 ceases to be an Affiliate of the Purchaser then the Purchaser shall procure that it assigns all of its rights as assignee either to the Purchaser
or to an Affiliate of the Purchaser and pending such assignment the assignee may not exercise any of its rights as assignee. 

 No assignment by Seller 
  

	13.3	The Seller may not: 

  

	 	13.3.1	assign, transfer, charge or deal in any way with the benefit of, or any of its rights under or interest in, this Agreement; or 

  

	 	13.3.2	sub-contract any or all of its obligations under this Agreement 

 or do any such thing in relation to any document or arrangement expressed to be supplemental to this Agreement, or which this Agreement expressly preserves or requires to be executed, except in accordance with a prior written waiver given
by the Purchaser. 
 Successors in title 
  

	13.4	This Agreement shall be binding upon and operate for the benefit of the personal representatives and permitted assigns and successors in title of each of the Parties and references
to the Parties shall be construed accordingly. 

  

	14.	Waiver; variation; invalidity 

 No waiver by
omission, delay or partial exercise 
  

	14.1	No right, power or remedy provided by law or under this Agreement shall be waived, impaired or precluded by any delay or omission to exercise it, by any single or partial exercise
of it on an earlier occasion, or by any delay or omission to exercise, or single or partial exercise of, any other such right, power or remedy. 

 Specific waivers to be in writing 
  

	14.2	Any waiver of any right, power or remedy under this Agreement must be in writing and may be given subject to any conditions thought fit by the grantor. No waiver will take effect if
the 

  

 18 

 person seeking the waiver has failed to disclose to the grantor every material fact or circumstance which
(so far as the person seeking the waiver is aware) has a bearing on its subject matter. Unless otherwise expressly stated, any waiver shall be effective only in the instance and only for the purpose for which it is given. 
 Variations to be in writing 
  

	14.3	No variation to this Agreement shall be of any effect unless it is agreed in writing and signed by or on behalf of each Party. 

 Invalidity 
  

	14.4	Each of the provisions of this Agreement is severable. If any such provision is or becomes illegal, invalid or unenforceable in any respect under the law of any jurisdiction that
shall not affect or impair the legality, validity or enforceability in that jurisdiction of the other provisions of this Agreement, or of that or any other provision of this Agreement in any other jurisdiction. 

  

	15.	Costs and expenses  

 Payment
of costs 
  

	15.1	Except as otherwise stated in this Agreement, each Party shall bear its own costs and expenses in relation to the negotiation, preparation, execution and carrying into effect of
this Agreement and all other agreements forming part of the transactions contemplated by this Agreement 

 Claims by
directors etc 
  

	15.2	The Seller covenants to pay the Purchaser on demand an amount equal to all Losses and Expenses that the Companies may suffer or incur as a result of any and all claims that may be
made against it by directors that are also officers of the Seller’s Guarantor by reason of their resignation and/or termination of their employment in accordance with Schedule 5 (Completion Obligations). 

 Unauthorised or invalid documents 
  

	15.3	The Purchaser shall indemnify and hold the Seller harmless, and the Seller shall indemnify and hold the Purchaser harmless, against any Losses and Expenses the Party indemnified may
suffer or incur as a result of any document delivered to it pursuant to clause 4.2 (Completion) being unauthorised, invalid or for any other reason ineffective for its purpose. 

  

	16.	Payments 

 No deduction etc

  

	16.1	Except as otherwise expressly provided in this Agreement, all payments to be made under this Agreement shall be made in full without any set off or counterclaim and free from any
deduction or withholding except as may be required by law (in which event such deduction or withholding shall not exceed the minimum amount required by law and the payer will pay to the payee whatever additional amount is required for the net amount
received to equal what would have been received if no such deduction or withholding had been required). Any amount payable in relation to any Warranty shall be increased to the extent necessary to ensure that the net amount received by the Purchaser
shall after Taxation be equal to that which it would have received had the payment not been subject to Taxation, save to the extent that Taxation has already been taken into account in calculating the quantum of the amount payable in relation to the
Warranty. 

  

 19 

 Payments to Seller’s Solicitors 
  

	16.2	Where this Agreement provides for any payment to be made to the Seller’s Solicitors (whether or not the manner of payment is specified) in each case the Seller irrevocably
authorises and instructs the Purchaser to make that payment to the Seller’s Solicitors, whose receipt shall be an effective discharge of the Purchaser’s obligation to pay the amount concerned. The Purchaser shall not be concerned to see to
the application or be answerable for the loss or misapplication of any such amount. 

 Interest on late payment 

  

	16.3	If a Party fails to pay any sum payable by it under this Agreement on the due date for payment, it shall pay interest on such sum for the period from and including the due date up
to the date of actual payment (after as well as before judgment) at the rate which is the aggregate of 2% per annum and the base rate from time to time of Barclays Bank pic. The interest will accrue from day to day on the basis of the actual
number of days elapsed and a 365-day year and shall be payable on demand and compounded monthly in arrears. 

  

	17.	Guarantee 

  

	17.1	The Purchaser shall use reasonable endeavours to procure that as soon as practicable following Completion the Seller’s Guarantor is released from the guarantee given by it in
the licence to assign dated 15 November 2002 between (1) Burry and Knight Limited (2) Devlin Electronics Limited, (3) AIDL and (4) the Seller’s Guarantor relating to the property at Castleman Crossing Centre, Ringwood,
Hampshire and pending such release will indemnify the Seller’s Guarantor against any Losses and Expenses arising under such guarantee. 

  

	18.	Entire agreement  

 This
Agreement 
  

	18.1	In this clause, references to this Agreement include all other written agreements and arrangements between the Parties, and all other instruments, which are expressed to be
supplemental to this Agreement or which this Agreement expressly preserves or requires to be executed. 

 Entire
agreement 
  

	18.2	The Transaction Documents constitute the whole and only agreement and understanding between the Parties in relation to its subject matter. Subject to sub-clause 18.6 (Fraud),
all previous drafts, agreements, understandings, undertakings, representations, warranties, promises and arrangements of any nature whatsoever between the Parties with any bearing on the subject matter of any Transaction Documents are superseded and
extinguished to the extent that they have such a bearing, except insofar as any such thing is in terms repeated or otherwise reflected in any Transaction Documents. 

  

	18.3	The parties have not entered into any Transaction Document in reliance upon any representation, warranty or promise and no such representation, warranty or promise or any other term
is to be implied in them whether by virtue of any usage or course of dealing or otherwise except as expressly set out in them. 

  

	18.4	If a party has given any representation, warranty or promise, then except to the extent that it has been set out in a Transaction Document, the party to whom it was given waives any
rights or remedies it may have in respect of it. 

  

 20 

 Other remedies 
  

	18.5	The rights, powers and remedies provided in this Agreement are independent and cumulative and do not exclude any rights, powers or remedies (express or implied) which are available
as a matter of common law, statute, custom or otherwise. 

 Fraud 
  

	18.6	Nothing in this Agreement shall be read or construed as excluding any liability or remedy in respect of fraud or fraudulent misrepresentation or concealment or any resulting right
to rescind the Agreement or the Tax Deed. 

  

	19.	Counterparts 

  

	19.1	This Agreement may be executed in any number of counterparts and by the Parties on different counterparts. Each counterpart shall constitute an original of this Agreement but all
the counterparts shall together constitute one and the same Agreement. 

  

	20.	Time of the essence 

  

	20.1	Time shall be of the essence of this Agreement as regards any time, date or period mentioned in it. If any such time, date or period (or variation of any of them) is varied, such
varied time, date or period shall be of the essence. 

  

	21.	Notices  

 Form of notices

  

	21.1	Any communication to be given in connection with the matters contemplated by this Agreement shall except where expressly provided otherwise be in writing and shall either be
delivered by hand or sent by first class pre-paid post or facsimile transmission. Delivery by courier shall be regarded as delivery by hand. 

 Address and facsimile 
  

	21.2	Such communication shall be sent to the address of the relevant Party referred to in this Agreement or the facsimile number set out below or to such other address or facsimile
number as may previously have been communicated to the sending Party in accordance with this clause. Each communication shall be marked for the attention of the relevant person. 

 Seller or the Seller’s Guarantor - facsimile number + 1 425 453 2916. For the attention of the VP Strategy & Technology 
 Purchaser- facsimile number 01243 861717. For the attention of Allan Imrie. 
 Purchaser’s Guarantor - facsimile number: +1610 725 8485. For the attention of Robert Feit/Patrick Farris. 
  

	21.3	In respect of any notice to be served on: 

  

	 	21.3.1	the Seller or the Seller’s Guarantor, a copy shall be sent or delivered to the Seller’s Solicitors and marked for the attention of David Kent and Mark Barron;

  

	 	21.3.2	the Seller, a copy shall be sent or delivered to the Seller’s Guarantor; 

  

	 	21.3.3	the Purchaser, a copy shall be sent or delivered to the Purchaser’s Guarantor; and 

  

 21 

	 	21.3.4	the Purchaser or the Purchaser’s Guarantor, a copy shall be sent or delivered to the Purchaser’s Solicitors and marked for the attention of Barney Hearnden and Danielle
Heath. 

 Deemed time of service 
  

	21.4	A communication shall be deemed to have been served: 

  

	 	21.4.1	if delivered by hand at the address referred to in sub-clause 21.2 (Address and facsimile) at the time of delivery; 

  

	 	21.4.2	if sent by first class pre-paid post to the address referred to in that sub-clause, at the expiration of two clear days after the time of posting; and 

  

	 	21.4.3	if sent by facsimile to the number referred to in that sub-clause, at the time of completion of transmission by the sender. 

 If a communication would otherwise be deemed to have been delivered outside normal business hours (being 9:30 a.m. to 5:30 p.m. on a Business Day) in the
time zone of the territory of the recipient under the preceding provisions of this clause, it shall be deemed to have been delivered at the next opening of such normal business hours in the territory of the recipient. 
 Proof of service 
  

	21.5	In proving service of the communication, it shall be sufficient to show that delivery by hand was made or that the envelope containing the communication was properly addressed and
posted as a first class pre-paid letter or that the facsimile was despatched and a confirmatory transmission report received. 

 Change of details 
  

	21.6	A Party may notify the other of a change to its name, relevant person, address or facsimile number for the purposes of sub-clause 21.2 (Address and facsimile) provided that
such notification shall only be effective on: 

  

	 	21.6.1	the date specified in the notification as the date on which the change is to take place; or 

  

	 	21.6.2	if no date is specified or the date specified is less than five clear Business Days after the date on which notice is deemed to have been served, the date falling five clear
Business Days after notice of any such change is deemed to have been given. 

 Non-applicability to Proceedings 

  

	21.7	For the avoidance of doubt, the Parties agree that the provisions of this clause shall not apply in relation to the service of any claim form, application notice, order, judgment or
other document relating to or in connection with any Proceedings. 

  

	22.	Governing law and jurisdiction 

 English law

  

	22.1	This Agreement shall be governed by and construed in accordance with English law. 

  

 22 

 Courts of England and Wales 
  

	22.2	The Parties irrevocably agree that the courts of England and Wales shall have exclusive jurisdiction to hear and determine or otherwise settle all and any disputes which may arise
out of or in connection with this Agreement. 

  

	23.	Seller’s Guarantee 

  

	23.1	The Seller’s Guarantor hereby unconditionally and irrevocably guarantees to the Purchaser the full, due and punctual performance and observation by the Seller of all the
obligations of the Seller under the terms of this Agreement (the “Seller Obligations”). In the event of any failure by the Seller to perform or observe such Seller Obligations, the Seller’s Guarantor shall be liable for
the Seller Obligations arising hereunder as if it were a primary obligor. 

  

	23.2	The obligations of the Seller’s Guarantor under this clause 23: 

  

	 	23.2.1	shall be continuing obligations in respect of all Seller Obligations which have not been previously discharged by the Seller or the Seller’s Guarantor and shall not be
satisfied, discharged or affected by any change in the constitution or control of, or the insolvency of, or any liquidation, winding up or analogous proceedings relating to the Seller; 

  

	 	23.2.2	shall be discharged on an ongoing basis by the due performance by the Seller or the Seller’s Guarantor of the relevant Seller Obligations, but otherwise shall not be
discharged, prejudiced, lessened, affected or impaired by any act, omission or circumstance whatsoever which but for this provision might operate to release or exonerate the Seller from all or any part of such obligations or in any way discharge,
prejudice, lessen, affect or impair the same; and 

  

	 	23.2.3	shall not be released or diminished by any forbearance, neglect or delay in seeking performance hereby imposed or any granting of time for such performance or, except in respect of
the variation of the Seller Obligation or this clause 23 in accordance with this Agreement, any variation of this Agreement. 

  

	23.3	The Seller’s Guarantor waives any right it may have to require the Purchaser first to proceed against or claim payment from the Seller before claiming under this clause 23.

  

	23.4	As a separate and independent stipulation, the Seller’s Guarantor agrees that any Seller Obligations expressed to be given by the Seller which may not be enforceable against or
recoverable from the Seller by reason of any disability or incapacity on or on behalf of the Seller shall nevertheless be enforceable against the Seller’s Guarantor as though the same had been incurred by the Seller’s Guarantor and the
Seller’s Guarantor was the sole and principal obligor in respect thereof and/or shall be performed or paid by the Seller’s Guarantor after receiving written notice on or after the time at which such obligation arises.

  

	24.	Purchaser’s Guarantee 

  

	24.1	The Purchaser’s Guarantor hereby unconditionally and irrevocably guarantees to the Seller the full, due and punctual performance and observation by the Purchaser of all the
obligations of the Purchaser under the terms of this Agreement (the “Purchaser Obligations”). In the event of any failure by the Purchaser to perform or observe such Purchaser Obligations, the Purchaser’s Guarantor shall
be liable for the Purchaser Obligations arising hereunder as if it were a primary obligor. 

  

	24.2	The obligations of the Purchaser’s Guarantor under this clause 24: 

  

	 	24.2.1	shall be continuing obligations in respect of all Purchaser Obligations which have not been previously discharged by the Purchaser or the Purchaser’s Guarantor and shall

  

 23 

 not be satisfied, discharged or affected by any change in the constitution or control of, or the
insolvency of, or any liquidation, winding up or analogous proceedings relating to the Purchaser; 
  

	 	24.2.2	shall be discharged on an ongoing basis by the due performance by the Purchaser or the Purchaser’s Guarantor of the relevant Purchaser Obligations, but otherwise shall not be
discharged, prejudiced, lessened, affected or impaired by any act, omission or circumstance whatsoever which but for this provision might operate to release or exonerate the Purchaser from all or any part of such obligations or in any way discharge,
prejudice, lessen, affect or impair the same; and 

  

	 	24.2.3	shall not be released or diminished by any forbearance, neglect or delay in seeking performance hereby imposed or any granting of time for such performance or, except in respect of
the variation of the relevant Purchaser Obligation or this clause 24 in accordance with this Agreement, any variation of this Agreement. 

  

	24.3	the Purchaser’s Guarantor waives any right it may have to require the Seller first to proceed against or claim payment from the Purchaser before claiming under this clause 24.

  

	24.4	As a separate and independent stipulation, the Purchaser’s Guarantor agrees that any Purchaser Obligations expressed to be given by the Purchaser which may not be enforceable
against or recoverable from the Purchaser by reason of any disability or incapacity on or on behalf of the Purchaser shall nevertheless be enforceable against the Purchaser’s Guarantor as though the same had been incurred by the
Purchaser’s Guarantor and the Purchaser’s Guarantor was the sole and principal obligor in respect thereof and/or shall be performed or paid by the Purchaser’s Guarantor after receiving written notice on or after the time at which such
obligation arises. 

  

	25.	Agent for Service 

  

	25.1	The Purchaser’s Guarantor irrevocably appoints Blake Lapthorn Tarlo Lyons: attention Jenny Hayward and Hilary Keeping, Harbour Court, Compass Road, North Harlow, Portsmouth,
PO6 4ST to be its agent for the receipt of service of process in England. It agrees that any documentation may be effectively served on it in connection with any Proceedings in England and Wales by service on its agent. 

  

	25.2	The Seller’s Guarantor irrevocably appoints Taylor Wessing LLP, of Carmelite, 50 Victoria Embankment, Blackfriars, London EC4Y ODX (attention: John Robinson) to be its agent
for the receipt of service of process in England. It agrees that any documentation may be effectively served on it in connection with any Proceedings in England and Wales by service on its agent. 

  

	25.3	If any agent referred to in clauses 25.1 and 25.2 (or any replacement agent appointed pursuant to this clause) at any time ceases for any reason (including its dissolution) to act
as the Purchaser’s Guarantor’s agent for service or the Seller’s Guarantor’s agent for service as appropriate, the Purchaser’s Guarantor or the Seller’s Guarantor (as the case may be) shall promptly and irrevocably
appoint another person with an address for service in England and Wales to be that parties agent for service on the terms of this clause and promptly notify the other party of the replacement’s name and address. Failing such appointment and
notification, the Seller’s Guarantor or the Purchaser’s Guarantor (as the case may be) shall be entitled by notice to the other party to appoint such a replacement (including itself) on the replacement’s standard or usual terms (if
any) for such appointments to act on the Purchaser’s Guarantor or the Seller’s Guarantor’s behalf (as the case may be) in accordance with this clause. By way of security, the Purchaser’s Guarantor and the Seller’s Guarantor
irrevocably appoints the other party as its attorney to effect any such appointment. 

  

	25.4	A copy of any document served on an agent pursuant to this clause shall be sent by post to the relevant in accordance with clause 21 (Notices), but no failure or delay in so
doing shall prejudice the effectiveness of service of the documentation. 

  

 24 

 AS WITNESS the hands of the Parties or their duly authorised representatives on the date first
appearing at the head of this Agreement. 
  

 25 

 Schedule 1 
 The Companies 
 Part 1 
  

			
		
	 Name:
	  	Muirhead Aerospace Limited
		
	 Number:
	  	560015
		
	 Date of incorporation:
	  	13 January 1956
		
	 Registered office:
	  	Mitre House, 160 Aldersgate Street, London EC1A 4DD
		
	 Share capital:
	  	
		
	 - authorised:
	  	10,000,000 ordinary shares of £1.00 each
		
	 - issued:
	  	5,510,101 ordinary shares of £1.00 each
		
	 Shareholder:
	  	
		
	 - name:
	  	Esterline Technologies Limited
		
	 - Shares held:
	  	5,510,101 ordinary shares of £1.00 each
		
	 Directors:
	  	Robert William Cremin
		
		  	Robert David George
		
		  	Larry Albert Kring
		
		  	Richard Bradley Lawrence
		
		  	Graham Payne
		
		  	Pradeep Kumar Sharma
		
		  	Stephen Keith Wells
		
	 Secretary:
	  	Mitre Secretaries Limited
		
	 Auditors:
	  	Ernst & Young
		
	 Charges:
	  	None
		
	 Subsidiaries:
	  	Advanced Input Devices (UK) Limited (subject to registration of transfer of legal title following stamping)
		
		  	Norcroft Dynamics Limited (subject to registration of transfer of legal title following stamping)

  

 26 

 Part 2 
  

			
	 Name:
	  	Advanced Input Devices (UK) Limited
		
	 Number:
	  	4436258
		
	 Date of incorporation:
	  	13 May 2002
		
	 Registered office:
	  	Mitre House, 160 Aldersgate Street, London EC1A 4DD
		
	 Share capital:
	  	
		
	 - authorised:
	  	10,000 ordinary shares of £0.01 each
		
	 - issued:
	  	101 ordinary shares of £0.01 each
		
	 Shareholder:
	  	
		
	 - name:
	  	Advanced Input Devices, Inc.
		
	 - Shares held:
	  	101 ordinary shares of £0.01 each
		
	 Directors:
	  	Robert William Cremin
		
		  	Robert David George
		
		  	Richard Bradley Lawrence
		
		  	Graham Payne
		
		  	Pradeep Kumar Sharma
		
	 Secretary:
	  	Mitre Secretaries Limited
		
	 Auditors:
	  	Ernst & Young
		
	 Charges:
	  	One charge outstanding: Rent Deposit Deed dated 15 November 2002 in favour of Burry and Knight Limited. Amount secured: £58,700 plus VAT.
		
	 Subsidiaries:
	  	None

  

 27 

 Part 3 
  

			
	 Name:
	  	Norcroft Dynamics Limited
		
	 Number:
	  	01412224
		
	 Date of incorporation:
	  	29 January 1979
		
	 Registered office:
	  	Mitre House, 160 Aldersgate Street, London EC1A 4DD
		
	 Share capital:
	  	
		
	 - authorised:
	  	106,200 ordinary shares of £0.20 each
		
	 - issued:
	  	106,200 ordinary shares of £0.20 each
		
	 Shareholder:
	  	
		
	 - name:
	  	Esterline Technologies Limited
		
	 - Shares held:
	  	106,200 ordinary shares of £0.20 each
		
	 Directors:
	  	Robert William Cremin
		
		  	Robert David George
		
		  	Larry Albert Kring
		
	 Secretary:
	  	Mitre Secretaries Limited
		
	 Auditors:
	  	Ernst & Young
		
	 Charges:
	  	None
		
	 Subsidiaries:
	  	None

  

 28 

 Part 4 
 

 
  

 29 

 Schedule 2 
 Properties 
 Part 1 
 Properties 
  

									
					
	(1)	  	(2)	  	(3)	  	(4)	  	(5)
					
	Description of Property	  	 Tenure and rent payable (if
 leasehold)
	  	Registered or unregistered	  	Title number and grade of title (if registered)	  	Existing Use
					
	Unit 4 Oakfield Road, Penge	  	Leasehold	  	Registered	  	 SGL693858
 Title absolute
	  	Manufacturing/ repair facilities and offices
					
	Mallory House, Southall Lane, Heston	  	Leasehold	  	Registered	  	N/a	  	Lightweight assembly of avionics equipment
					
	5 East Portway Industrial Estate, Andover	  	Leasehold	  	Registered	  	 HP580162,
 Title absolute
	  	Manufacturing and offices
					
	Plot l, Castleman Crossway Centre, Ringwood	  	Leasehold	  	Unregistered	  	N/a	  	Factory and office premises

 Part 2 
 Leases 
  

									
					
	(1)	  	(2)	  	(3)	  	(4)	  	(5)
					
	Property	  	Date	  	Term	  	Parties	  	Current yearly rent
					
	Unit 4 Oakfield Road, Penge in the London Borough of Bromley	  	30 August 2006	  	 10 years from
 1 December 2007
	  	 Industrial Property Investment Fund
 (1)
 Muirhead Aerospace Limited
 (2)
	  	£351,000
					
	Mallory House, Navigator Park, Southall Lane, Heston, Middlesex	  	12 September 2003	  	 10 years from
 12 September 2003
	  	 Harlequin Centre (Heston) (No. 1)
 Limited and

Harlequin Centre
 (Heston) (No. 2)
 Limited (1) and
 Muirhead
 Aerospace Limited
 (2)
	  	 £130,000
 (+£3, 000 pa as contribution to
landlord’s works)

  

 30 

									
	 (1)
	  	(2)	  	(3)	  	(4)	  	(5)
					
	Property	  	Date	  	Term	  	Parties	  	Current yearly rent
					
	5 East Portway Industrial Estate, Andover	  	29 November 1976	  	99 years (commenced on 10 April 1973)	  	The District Council of Test Valley (1) and The Croydex Company Limited (2)	  	£22,570
					
	Plot 1 Castleman Crossing Centre, Ringwood, Hampshire	  	4 December 2000	  	20 years (commenced on 4 December 2000)	  	Burry and Knight Limited (1) Devlin Electronics Limited (2) Spirent plc (3)	  	£72,500

 Part 3 
 Letting Documents 
  

									
					
	 (1)
	  	(2)	  	(3)	  	(4)	  	(5)
					
	Property	  	Date	  	Term	  	Parties	  	Current yearly rent
					
	Electricity Substation, 5 East Portway Industrial Estate, Andover	  	23 February 1994	  	 21 years from
 10 October 1994
	  	The Croydex Company Limited (1) Southern Electric Plc (2)	  	£1

  

 31 

 Schedule 3 
 Intellectual Property 
 Part 1 
 Registered IP (excluding Licences In) 
 List of Granted Patents 
  

					
	Patent number	 	Description
	 US
6,717,086
	 	Switch with adjustable bias means	 	 
	 GB2367947
	 	A switch	 	 
	 US
7,133,033
	 	Actuator for a switch	 	 
	 GB2341439
	 	Control Device	 	 
	 US 6,740,863
	 	Joystick	 	 
	 GB2383410
	 	Joystick	 	 
	 GB2412715
	 	Improvements relating to pointing devices	 	 
	 GB2413620
	 	Improvements relating to pointing devices	 	 
	 US6949904
	 	Power-actuated seat	 	 

  

 32 

 List of Patent Applications 
  

							
	 Patent application number
	  	Description	  	File Date	  	Publish Date
	 0421372.4
	  	Signal conditioning circuit	  	24th
September 2004	  	29th March 2006
	 11/233919
	  	Signal conditioning circuit	  	29th
October 2005	  	 
	 11/097544
	  	Pointing Devices	  	1st
April 2005	  	 

 List of Registered Trade Marks 
  

													
	 Mark
	  	Country	  	Status	  	Class No	  	App Date	  	Reg No	  	Reg Date
	 TRAXSYS
	  	Community Trademark	  	Registered	  	9, 38, 42	  	31 October 2003	  	3501483	  	20 April 2005
	 TRAXSYS
	  	United States	  	Registered	  	9	  	12 June 2003	  	2,925,937  	  	8 February 2005
	 TRAXSYS
	  	United States	  	Registered  	  	9	  	14 July 2003	  	2,979,017	  	26 July 2005
	 TRAXBALL
	  	Community Trademark  	  	Registered	  	9	  	25 February 2005	  	4310124	  	4 April 2006
	 TRAXBALL
	  	United States	  	Registered	  	9	  	22 September 2004  	  	3083760	  	18 April 2006
	 MUIRHEAD
	  	Community Trademark	  	Registered	  	7, 9, 35, 37, 40, 42  	  	30 October 2003	  	3482734	  	4 March 2005
	 MUIRHEAD
 VATRIC
	  	United Kingdom	  	Registered	  	7	  	3 August 1993	  	1543670	  	1 September 1995
	 MUIRHEAD
 VATRIC
	  	United Kingdom	  	Registered	  	9	  	21 January 1992	  	1488530	  	10 December 1993

  

 33 

 Part 2 
 Material unregistered IP (excluding Licences In) 
 Copyright in design drawings and specifications created by the
Company in respect of products sold or to be sold to its customers. 
 Know-how relating to the design, engineering and manufacturing processes relating to
products sold by the Company to its customers. 
 Part 3 
 Licences In - registered 
  

									
	 	 	Licensor	 	Licensee	 	Priority Date	 	Subject note
	 1
	 	Sensopad Technologies Ltd	 	AID (UK) Ltd trading as Traxis	 	30 Oct 2001	 	PCT/GB0201204
Field Position Sensor
(ret. Only PAD1)
	 2
	 	Sensopad Technologies Ltd	 	AID (UK) Ltd trading as Traxis	 	5 Feb 2002	 	PCT/GB2003/000495
Ball Tracking Device

 Notes: 
  

	1.	Family of Patents owned by Sensopad and used by Traxsys 

  

	 	—	 	 Priority date was 30 October 2001 

  

	 	—	 	 PCT application number is GB02/01204 PCT publication number is WO03/038379 

  

	 	—	 	 Granted as EP1442273 (Europe), in DE, FR, IT, ES, NL, SE & GB2374424, also granted as US7208945, prosecution ongoing in China, Korea, Norway, Australia,
Japan 

  

	2.	Family of Patent Applications: “Ball tracking device” 

  

	 	—	 	 Priority date was 5 February 2002 

  

	 	—	 	 PCT application number is GB03/000495 PCT publication number is WO03/067181 

  

	 	—	 	 Not yet granted, prosecution ongoing in EP, US, Japan & China 

 Sensopad Technologies Limited has since changed its name to TT Electronics Limited. 
  

 34 

 Part 4 
 Licences In - material unregistered 
 Implied licences from some customers of the Business to use specifications and
design drawings provided by customers to design and manufacture parts for such customers 
 Know-how relating to the Sensopad patents set out in Part 3
above. 
  

 35 

 Schedule 4 
 Information Technology 
 Part 1 
 IT Systems 
  

			
	 (1)
	  	(2)
	 AS/400
	  	Muirhead Motion & Avionics
	 File & Print
Server
	  	Muirhead Motion & Avionics
	 Exchange
Server
	  	Muirhead Motion & Avionics
	 PDM
Server
	  	Muirhead Motion
	 Domain Controller

	  	Muirhead Motion & Avionics
	 SQL
Server
	  	Muirhead Motion & Avionics
	 NAS
Box
	  	Muirhead Motion & Avionics
	 Antivirus
Server
	  	Muirhead Motion & Avionics
	 DCS
Server
	  	Muirhead Motion
	 Terminal Services
Server
	  	Muirhead Motion & Avionics
	 Websense
Server
	  	Muirhead Motion & Avionics
	 PDM
Server
	  	Traxsys Site
	 Domain Controller

	  	Traxsys Site
	 Sytline
Server
	  	Traxsys Site
	 File & Print
Server
	  	Traxsys Site
	 Exchange
Server
	  	Traxsys Site
	 Samsung Telephone
system
	  	Muirhead Motion & Avionics
	 Eserver
15
	  	Muirhead Motion & Avionics

  

					
	 Product
	 	Total Licences  	 	Total Installs
	 Office
97
	 	247	 	244
	 Office Pro
2000
	 	 
	 Office Pro
XP
	 	 
	 Office Pro
2003
	 	 
	 Office Pro Plus 2007

	 	 
	 Project
2000
	 	62	 	36
	 Project Standard 2002

	 	 
	 Project Pro
2003
	 	 
	 Project Standard 2003

	 	 
	 Project Standard 2007

	 	 
	 Visio Standard 2002

	 	47	 	41
	 Visio Standard 2002

	 	 
	 Visio Pro
2003
	 	 
	 Visio Standard 2007

	 	 
	 LS/400 main production system –
 Avionics
	 	 	 	 
	 LS/400 main production system –
 Aerospace
	 	 	 	 
	 Sophos antivirus
software
	 	300	 	300
	 Websense
	 	 	 	 
	 Virtual
Office
	 	11	 	11
	 Linpics
system
	 	 	 	 
	 Q-pulse
	 	 	 	 
	 Minitab
	 	5	 	5
	 Sonicwall
	 	 	 	 
	 Sonicwall
GAV & IPS
	 	 	 	 
	 Time and Attendance

	 	 	 	 

  

 36 

					
	 Product
	 	Total Licences	 	Total Installs
	 Gumbo Spoolmail and
 SpoolAMatic
	 	 	 	 
	 Payroll
HRWorks
	 	 	 	 
	 Permissions Analyser

	 	 	 	 
	 Mail Disclaimer
Maintenance
	 	 	 	 
	 Mathcad
	 	5	 	5
	 Opera
2d
	 	3	 	3
	 MotorCad
	 	4	 	4
	 Schaffner EPS 9980 emission
 software
	 	 	 	 
	 Ultiboard/Multism
software
	 	 	 	 
	 PDM
	 	 	 	 
	 Design Space (annual renewal
 required)
	 	 	 	 

 Part 2 
 Domain names 
  

	
	 MUIRHEADAEROSPACE.COM

	 MUIRHEADAVIONICS.COM

	 TRAXSYS.COM

	 TRAXSYS.EU

	 TRAXSYS.CO.UK

	 TRAXSYS.ORG

	 TRAXSYS.ORG.UK

 Part 3 
 IT Contracts 
 Disaster recovery contract with NDR 
 Maintenance agreement in respect of Samsung Telephone system with Progressive Communications (supplier) 
 Line rental for phone and other telecommunications and related support - Spitfire 
 Maintenance agreement in respect of Avaya telephone equipment with Comec 
 Maintenance agreement in respect of the Penge telephone system with Cenreal 
  

			
	 AS400 software support
	 	Supplier
	 	 	 
	 LS/400 main
production system - Avionics
	 	Friedman
	 LS/400 main
production system - Aerospace
	 	Friedman
	 	 	 
	 Network
support
	 	 
	 Penge

	 	 
	 Sophos antivirus
software
	 	Foursys Ltd
	 Websense
	 	Foursys Ltd
	 Virtual
Office
	 	Virtuall Software
	 Linpics
system
	 	Forward Microsystems
	 Q-pulse
	 	Gael Quality Software

  

 37 

			
	 AS400 software support
	 	Supplier
	 Minitab
	 	Minitab
	 Sonicwall
	 	Lan2Lan
	 Sonicwall
	 	ISIPITT
	 Time and Attendance

	 	Kronos
	 Gumbo Spoolmail and
SpoolAMatic
	 	Friedman Corporation
	 Payroll
HRWorks
	 	Wealden
	 Permissions Analyser

	 	Share-IT
	 Mail Disclaimer
Maintenance
	 	 
	 	 	 
	 Andover

	 	 
	 Mathcad
 software assurance
	 	PTC
	 Opera
2d
	 	Vector Fields
	 MotorCad
	 	Motor Design Ltd
	 Schaffner EPS 9980
emission software
	 	Schaffner
	 Ultiboard/Multism
software
	 	National Instruments
	 PDM
	 	NTCADCAM
	 Design
Space
	 	IDAC/ANSYS
	 Lan 2
Lan
	 	 
	 	 	 
	 IBM

	 	 
	 	 	 
	 Eserver
i5
	 	IBM

  

 38 

 Schedule 5 
 Completion Obligations 
  

	1.	Seller’s Completion obligations 

 The Seller
will be obliged to deliver to the Purchaser (or otherwise make available to the satisfaction of the Purchaser): 
  

	 	(a)	a copy of the minutes of a meeting of the directors of the Seller authorising the execution by the Seller of this Agreement and the Tax Deed; 

  

	 	(b)	transfers of the Shares duly executed by the Seller in favour of the Purchaser or its nominee(s) together with the relevant share certificates (or, in lieu of share certificates,
indemnities in a form satisfactory to the Purchaser); 

  

	 	(c)	the IT Assignment Documents duly executed by the parties thereto; 

  

	 	(d)	agreed form claims or elections under paragraph 66 of Schedule 29 FA 2002 or Section 179A TCGA (as appropriate) to give effect to clause 14 (Joint elections) of the Tax
Deed; 

  

	 	(e)	the statutory registers and minute books (properly written up to the time immediately prior to Completion), the common seal (if any), the certificate of incorporation and (if
applicable) any certificate of incorporation on change of name of each Company; 

  

	 	(f)	the Tax Deed duly executed as a deed by the Seller; 

  

	 	(g)	the Traxsys Supply Agreement duly signed by AIDL and AID Inc; 

  

	 	(h)	the Deeds of Assignment executed as deeds by the parties thereto; 

  

	 	(i)	the Payne Compromise Agreement duly executed by Graham Payne and Muirhead; 

  

	 	(j)	the Releases duly executed by Wachovia Bank and the relevant Company; 

  

	 	(k)	certificates from each of the banks at which either Company maintains an account of the amount standing to the credit or debit of all such accounts as at the close of business on
the last Business Day before the Completion meeting; 

  

	 	(1)	at its registered office all material records, correspondence, documents, files, memoranda and other papers belonging to each Company but not kept at any of the Properties, and
shall procure that any other person controlled by the Seller shall do the same without delay; 

  

	 	(m)	the written resignations in the agreed form of all the directors and the secretary of each Company from their respective offices, such resignations to take effect from Completion;

  

	 	(n)	irrevocable powers of attorney in the agreed form executed by the Seller in favour of the Purchaser or its nominee(s) to enable the beneficiary (pending registration of the
transfers of the Shares) to exercise all voting and other rights attaching to the Shares and to appoint proxies for this purpose; and 

  

	 	(o)	a written shareholder resolution to change the name of AIDL to Traxsys Input Products Limited in agreed form; 

 and to cause a board meeting of each Company to be held at which: 
  

 39 

	 	(a)	the transfers of the Shares will be approved for registration (subject to their being duly stamped, which shall be at the cost of the Purchaser); 

  

	 	(b)	all resignations provided for above will be tendered and accepted so as to take effect at the close of the meeting; 

  

	 	(c)	all persons nominated by the Purchaser (in the case of directors, subject to any maximum number imposed by the relevant articles of association) will be appointed additional
directors and appointed secretary; 

  

	 	(d)	all existing instructions and authorities to bankers will be revoked and will be replaced with alternative instructions, mandates and authorities in such form as the Purchaser may
require; 

  

	 	(e)	the registered office will be changed to P. O. Box 36, 2 New Star Road, Leicester, LE4 9JQ; 

  

	 	(f)	the accounting reference date will be changed to 31 December; and 

  

	 	(g)	such other business as the Purchaser may reasonably require will be conducted. 

  

	2.	Purchaser’s Completion obligations 

 The
Purchaser’s obligations (which are subject to the Seller complying with its obligations under paragraph 1) are to: 
  

	 	(a)	pay to the Seller’s Solicitors by electronic transfer an amount comprising the Provisional Consideration; and 

  

	 	(b)	deliver to the Seller: 

  

	 	(i)	a counterpart Tax Deed duly executed by the Purchaser; and 

  

	 	(ii)	a copy of the minutes of a meeting of the directors of the Purchaser authorising the execution by the Purchaser of this Agreement and the Tax Deed (such copy minutes being in each
case certified as correct by the secretary of the Purchaser). 

  

 40 

 Schedule 6 
 Warranties 
 Part 1 
 General warranties 
  

	1.	Power to contract 

 The Seller has full power to
enter into and perform this Agreement and the Tax Deed, each of which constitutes (or will when executed constitute) binding obligations on the Seller in accordance with their respective terms. 
  

	2.	The Company 

 Memorandum and articles of
association 
  

	2.1	The copy of the memorandum and articles of association of the Company which has been Disclosed is true and complete in all respects and has embodied in it or annexed to it a copy of
every such resolution and agreement as is referred to in section 29(1)(b) Companies Act 2006. The Company has at all times since carried on its business and affairs in all respects in accordance with its memorandum and articles of association and
all such resolutions and agreements. 

 Statutory books 
  

	2.2	The statutory books (including all registers and minute books) of the Company have been properly kept and contain an accurate and complete record of the matters which should be
dealt with in those books, and no notice or allegation that any of them is incorrect or should be rectified has been received. 

 Statutory returns 
  

	2.3	The Company has complied with the provisions of the Companies Acts (as defined in the Companies Act 2006) and the Companies Act 1989 in that all returns, particulars, resolutions
and other documents required to be filed with or delivered to the Registrar of Companies or to any other authority whatsoever by the Company have been correctly and properly prepared and so filed or delivered. 

 Share capital 
  

	2.4	The Shares constitute the whole of the issued share capital of Muirhead and the Seller is the sole beneficial owner of the Shares as set out in part 1 Schedule 1. There is no
Encumbrance on, over or affecting any of the Shares or any unissued shares, debentures or other securities of Muirhead. No claim has been made by any person to be entitled to the benefit of any such Encumbrance and no person has the right
(exercisable now or in the future and whether contingent or not) to call for the issue of any share or loan capital of the Company. 

 Subsidiaries’ shares 
  

	2.5	Muirhead is the sole beneficial owner of the entire issued share capital of AIDL and Norcroft as set out in Schedule 1 and is entitled to be registered as the legal owner of such
shares. There is no Encumbrance on, over or affecting any of the shares in AIDL or Norcroft or any unissued shares, debentures or other securities of AIDL or Norcroft. No claim has been made by any person to be entitled to the benefit of any such
Encumbrance and no person has the right (exercisable now or in the future and whether contingent or not) to call for the issue of any share or loan capital of AIDL or Norcroft. 

  

 41 

 Purchase of own shares etc 
  

	2.6	The Company has at no time: 

  

	 	2.6.1	repaid, redeemed or purchased any of its own shares, or otherwise reduced its issued share capital or any class of it, or capitalised, in the form of shares, debentures or other
securities or in paying up any amounts unpaid on any shares, debentures or other securities, any profits or reserves of any class or description or passed any resolution to do so, or agreed to do any of the above; or 

  

	 	2.6.2	directly or indirectly provided any financial assistance for the purpose of the acquisition of its own shares or the shares of any holding company of the Company or for the purpose
of reducing or discharging any liability incurred in such an acquisition, whether in accordance with sections 155 and 156 CA 85 or otherwise. 

 Solvency 
  

	2.7	The Company is not insolvent as defined by section 123 Insolvency Act 1986: 

  

	 	2.7.1	has not entered into any scheme of arrangement or voluntary or other arrangement with any of its creditors, nor taken any steps to obtain a moratorium as set out in Schedule Al of
that Act; 

  

	 	2.7.2	no order has ever been made or petition presented or resolution passed for its winding up and no distress, execution or other process has ever been levied on its assets;

  

	 	2.7.3	no administrative or other receiver or manager has been appointed by any person over the whole or any part of its business or assets, nor has any petition been presented or
application made for the appointment of an administrator in respect of it; and 

  

	 	2.7.4	there are no circumstances which would entitle any person to present a petition to wind it up, to appoint an administrator in respect of it or to appoint an administrative or other
receiver or manager over the whole or any part of its undertaking or assets. 

  

	2.8	AID Inc was not insolvent or unable to pay its debts within the meaning of section 123 Insolvency Act 1986 or any equivalent legislation in the United States of America at the time
of (nor did it become so as a result of) the sale of the shares in AIDL to Muirhead and there are no circumstances that would entitle a liquidator or administrator (or equivalent office holder) to set aside the sale by AID Inc of the shares in AIDL
to Muirhead. 

  

	3.	Connected business 

 Connected transactions

  

	3.1	The Company: 

  

	 	3.1.1	has not been, nor has agreed to become, the holder or other owner of any shares, debentures or other securities of any other body corporate (whether incorporated in the United
Kingdom or elsewhere) with the exception of Norcroft and AIDL; 

  

	 	3.1.2	has not agreed to become a subsidiary of any other body corporate or under the control of any group of bodies corporate or consortium; 

  

	 	3.1.3	is not, nor has agreed to become, a member of any partnership, joint venture, consortium or other unincorporated association other than a recognised trade association or a party to
any agreement or arrangement for sharing commissions or other income; and 

  

 42 

	 	3.1.4	has no branch, place of business or substantial assets outside England and Wales or any permanent establishment (as that expression is defined in any relevant Order in Council made
pursuant to section 788 TA 88) in any country outside the United Kingdom. 

  

	4.	Accounts 

 General 
  

	4.1	The Accounts have been audited, have been prepared and presented in accordance with UK GAAP, are consistent with the practice and policies adopted by the Company or during the
three accounting periods ended on the Balance Sheet Date, comply with the requirements of CA 85 or the Companies Act 2006 (whichever is applicable) and give a true and fair view of the assets, liabilities and the financial position (including
profits and losses) of the Company as at the Balance Sheet Date. 

 Provisions 
  

	4.2	Without prejudice to the contents of paragraph 4.1 above, the Accounts make proper provision or reserve for (or where appropriate disclose by way of note) all material liabilities,
contingent liabilities, bad and doubtful debts, obsolete or slow moving stock and depreciation; and do not include (and the profits of the Company for the period have not been affected to a material extent by) any unusual, exceptional or
non-recurring items of income or expenditure, with a value in excess of £100,000. 

 True and fair view 

  

	4.3	The profit and loss accounts, balance sheets and reports of the Company (copies of which have been Disclosed) covering the three years ended on the Balance Sheet Date, give a true
and fair view of the assets, liabilities and financial position (including profits and losses) of the Company at the relevant dates, and there were no unusual, exceptional or non-recurring items or transactions entered into other than in the normal
course of trade which materially affect such accounts or the trend of profits shown by them. 

 Basis of valuation

  

	4.4	The basis of valuation for stock-in-trade, work-in-progress and of depreciation of fixed assets adopted for the purpose of the Accounts and each of the accounting periods of the
Company for the last three financial years ended on the Balance Sheet Date has, in all material respects, remained consistent. 

 Books of account 
  

	4.5	All accounts, books, ledgers, financial and other necessary records of whatsoever kind of the Company (including all invoices and other records required for VAT purposes) have been
accurately maintained, are in the possession of the Company and contain true and accurate records of all matters (including those required to be entered in them by all applicable legislation) and no notice or allegation that any of them is incorrect
or should be rectified has been received. 

 US GAAP Accounts 
  

	4.6	The US GAAP Accounts have been properly prepared and presented in accordance with the Company’s accounting records, are in accordance with US GAAP and fairly and in
all material respects state the assets, level of turnover, operating profit and losses and liabilities of the Company as at that date and for that period and (except as expressly disclosed in them) do not include any unusual, exceptional or
non-recurring item of income or expenditure. 

  

 43 

	5.	Post-Balance Sheet Date events 

  

	5.1	Since the Balance Sheet Date: 

  

	 	5.1.1	the Company has carried on its business in the normal course and without any interruption or alteration in the nature, scope or manner of its business; 

  

	 	5.1.2	the Company has not experienced any material deterioration in its financial position or prospects or turnover or suffered any diminution of its assets by the wrongful act of any
person and the Company has not had its business, profitability or so far as the Seller is aware prospects materially and adversely affected by the loss of any important customer or source of supply or by any abnormal factor not affecting similar
businesses to a like extent and so far as the Seller is aware there are no facts which are likely to give rise to any such effects; 

  

	 	5.1.3	the Company has not acquired or disposed of or agreed to acquire or dispose of any assets or assumed or incurred or agreed to assume or incur any material liabilities (actual or
contingent), or made any payment not provided for in the Accounts, or entered into any other transaction, otherwise than in the ordinary course of trading; 

  

	 	5.1.4	the Company has not declared, made or paid any dividend, bonus or other distribution of capital or income (whether a qualifying distribution or otherwise) and (excluding
fluctuations in overdrawn current accounts with bankers) no loan or loan capital of the Company has been repaid in whole or in part or has become due or is liable to be declared due for any reason; 

  

	 	5.1.5	the Company has not made any change to the remuneration, terms of employment, emoluments or pension benefits of any present or former director, officer or employee of the Company
who on the Balance Sheet Date was entitled to remuneration in excess of £50,000 per annum and has not appointed or employed any additional director, officer or employee who is so entitled; 

  

	 	5.1.6	the Company has received payment in full on their due dates of all debts owing to the Company shown in the Accounts (subject to any provision for bad and doubtful debts made in the
Accounts), and the Company has not released any debts in whole or in part or written off debts in an amount exceeding £100,000 in the aggregate; 

  

	 	5.1.7	the Company has not entered into contracts involving capital expenditure in an amount exceeding £100,000 in the aggregate; 

  

	 	5.1.8	the Company has not become aware that any event has occurred which would entitle any third party to terminate any contract or any benefit enjoyed by the Company or to call in any
money before the normal due date; 

  

	 	5.1.9	the Company has not purchased stocks in quantities or at prices materially greater than was the practice of the Company before the Balance Sheet Date; 

  

	 	5.1.10	the Company has paid its creditors within the times agreed with such creditors and has no debts outstanding which are overdue for payment by more than four weeks;

  

	 	5.1.11	the Company has not created or agreed to create any Encumbrance or entered into any factoring arrangement, hire-purchase, conditional sale or credit sale agreement which has not
been Disclosed (and there has been no default by the Company in the performance or observance of any of the provisions of any such Disclosed Encumbrance, arrangement or agreement); 

  

	 	5.1.12	 the Company has not borrowed or raised any money or taken any financial facility (except such short term borrowings from bankers as are within the amount of any

  

 44 

	 	 
overdraft facility which was available to the Company at the Balance Sheet Date) or renegotiated or received any notice from any banker that such banker
wishes to renegotiate any overdraft facility available to the relevant Company at the Balance Sheet Date; 

  

	 	5.1.13	the Company has not made any material change to the accounting procedures or principles by reference to which the Accounts were drawn up nor made any change to its accounting
reference date and no accounting period of the Company has ended since the Balance Sheet Date; and 

  

	 	5.1.14	the Company (including any class of its members) has not passed any resolution whether in general meeting or otherwise. 

  

	5.2	Prior to the date of this Agreement, the Seller has procured the repayment by the Companies of all External Borrowings and Inter-Company Payables. 

  

	6.	Transactions with the Seller, directors and Connected Persons 

  

	  	Loans and debts 

  

	6.1	There are not outstanding: 

  

	 	6.1.1	any Inter-Company Payables or Inter-Company Receivables 

  

	 	6.1.2	and, save for Ordinary Trading Items, there is not outstanding: 

  

	 	(a)	any other indebtedness or other liability (actual or contingent) owing by the Company to the Seller or any director of the Company or any Connected Person or owing to the Company by
the Seller or any director of the Company or any Connected Person; or 

  

	 	(b)	any guarantee or security for any such indebtedness or liability.  

  

	  	Arrangements with Connected Persons 

  

	6.2	The Company: 

  

	 	6.2.1	is not, nor has it at any time during the last three years been, a party to any agreement, arrangement or understanding (whether legally enforceable or not) in which the Seller, or
any director of the Company or any Connected Person is or has been interested whether directly or indirectly; or 

  

	 	6.2.2	is not a party to, nor have its profits or financial position during the last three years been affected by, any agreement or arrangement which is not entirely of an arm’s
length nature. 

  

	  	Competitive interests 

  

	6.3	None of the Seller, the directors of the Company nor any Connected Person, either individually or with any other person or persons, has any estate, right or interest, directly or
indirectly, in any business other than that now carried on by the Company which is or is likely to become competitive with any aspect of the Business of the Company except: 

  

	 	6.3.1	as registered holder or other owner of any class of securities of any company if such class of securities is listed on any recognised investment exchange (as defined in the
Financial Services and Markets Act 2000) and if such person (together with Connected Persons and Affiliates) holds or is otherwise interested in less than three per cent of such class of securities; 

  

 45 

	 	6.3.2	for the Permitted Business and in relation to which the full details of the existing Permitted Business have been Disclosed, 

  

	  	and the Seller is not itself or with any other person or persons interested in any way whatsoever in any Intellectual Property Rights used and not wholly owned by the Company.

  

	  	Benefits 

  

	6.4	No Connected Person is entitled to or has claimed entitlement to any remuneration, compensation or other benefit from the Company. 

  

	7.	Finance 

  

	  	Borrowings 

  

	7.1	Particulars of all money borrowed by the Company have been Disclosed. The total amount borrowed by the Company from any source does not exceed any limitation on its borrowing
contained in the articles of association of the Company or in any debenture or loan stock trust deed or instrument or any other document binding on the Company and the amount borrowed by the Company from each of its bankers does not exceed the
overdraft facility agreed with such banker. The Company has no outstanding loan capital. 

  

	  	Debts owed to the Company 

  

	7.2	All debts owed to the Company are collectable in the ordinary course of business and each such debt will so far as the Seller is aware realise in full its face value within three
months of its due date for payment. The Company owns the benefit of no debt (whether present or future) other than debts that have accrued to it in the ordinary course of business. 

  

	  	Bank accounts 

  

	7.3	There have been Disclosed: 

  

	 	7.3.1	particulars of the balances on all the bank accounts of the Company as at a date not more than two days before the date of this Agreement and the Company has no other bank accounts.
Since the date of such particulars there have been no payments out of any such bank accounts except for routine payments; 

  

	 	7.3.2	all unpresented cheques drawn by the Company, and there are no such unpresented cheques drawn otherwise than in the normal course of business. 

  

	  	Financial facilities 

  

	7.4	The Seller has Disclosed full details and true and correct copies of all documents relating to all debentures, acceptance lines, overdrafts, loans or other financial facilities
outstanding or available to the Company and all Encumbrances to which any asset of the Company is subject. Neither the Seller nor the Company has done anything whereby the continuance of any such facility or Encumbrance in full force and effect
might be affected or prejudiced. 

  

	  	Grants 

  

	7.5	Full details of all grants made to the Company in the last six years, and all outstanding applications for any such grant, have been Disclosed. No act or transaction has been
effected in consequence of which the Company is or could be held liable to refund (in whole or in part) any such grant or any loan received by virtue of any statute, or in consequence of which any such grant or loan for which application has been
made by it will not or may not be paid or will or may be reduced. 

  

 46 

 Options and guarantees 
  

	7.6	The Company is not responsible for the indebtedness of any other person nor party to any option or pre-emption right or any guarantee, suretyship or any other obligation (whatever
called) to pay, purchase or provide funds for the payment of, or as an indemnity against the consequence of default in the payment of, any indebtedness of any other person; and no person has given any guarantee of or security for any overdraft, loan
or loan facility granted to the Company. 

 Payment of obligations 
  

	7.7	There has been no delay by the Company in the payment of any material obligation due for payment. 

  

	8.	Environment 

 Definitions 

 

	8.1	In this Agreement: 

 “Environment” means
any and all organisms (including man), ecosystems, property and the following media: air (including the air within buildings and the air within other natural or man-made structures, whether above or below ground); water (including water under or
within land or in drains or sewers and coastal and inland waters); and land (including land under water); 
 “Environment
Agreements” means any and all leases or licences or other agreements (including agreements of the nature referred to within DETR Circular 01/2006 dated September 2006) which are binding on the Company but only to the extent that they relate
to the protection of the Environment and/or the prevention of Harm and/or Remediation Action and/or the provision of remedies in respect of Harm; 
 “Environment Law” means any and all laws applying as at the date of this Agreement, whether civil, criminal or administrative and which have as a purpose or effect the protection of the Environment and/or the prevention of
Harm and/or the carrying out of Remediation Action and/or the provision of remedies in respect of Harm which are legally binding, including: European Community or European Union regulations, directives, decisions and recommendations; statutes and
subordinate legislation; regulations, orders and ordinances; Permits; codes of practice, circulars, guidance notes and the like; common law, local laws and bye-laws; and judgments, notices, orders, directions, instructions or awards of any Competent
Authority; 
 “Environment Liability” means liability (including liability in respect of Remediation Action) on the part of
the Company and/or any of its directors or officers or shareholders under Environment Laws; 
 “Harm” means harm or damage
to, or other interference with, the Environment and includes, in the case of man, offence caused to any of his senses or harm or damage to his property; 
 “Hazardous Matter” means any and all matter (including asbestos), radiation, electricity, heat, vibration or noise that (alone or in combination) is capable of causing Harm; 
 “Other Property” means any and all land or property, other than any Property, owned, occupied or operated at any time by the Company
including any land or property used for the disposal, reclamation or recycling of Hazardous Matter; 
 “Permits” means any
and all licences, consents, permits, registrations, filings, exemptions, approvals, authorisations or the like, made or issued pursuant to or under, or required by, Environment Law in relation to the Properties and/or the carrying on of the
Business; 
  

 47 

 “Remediation Action” means (i) preventing, limiting, removing, remedying,
cleaning-up, abating or containing the presence or effect of any Hazardous Matter in the Environment or (ii) carrying out investigative, design and scoping work and obtaining legal and other professional advice as is reasonably required in
relation to (i). 
 Compliance with Environment Law 
  

	8.2	So far as the Seller is aware, each Property and any Other Property has been used, and the Company has operated, at all times in material compliance with Environment Law and no
work, repairs, remediation, construction, or capital expenditure over £100,000 is required under any Environment Law. 

  

	8.3	The Seller has Disclosed all material correspondence between the Company and the competent authorities in respect of the Environment. 

 Permits 
  

	8.4	All Permits necessary under Environment Law for carrying on of the Business in the manner in which the Business is now carried on have been obtained, full copies of them have been
Disclosed, and all are in full force and effect and their terms and conditions have been materially complied with. No circumstances exists which may result in modification, suspension, or revocation of any Permit or may result in any such Permit not
being extended, renewed, granted or (where necessary) transferred. Renewals of all permits, if required, have been timely applied for. 

 Hazardous Matter 
  

	8.5	As far as the Seller is aware, no Hazardous Matter has been spilled, deposited, disposed of, discharged, emitted at, on, under or from any Property and/or the Other Properties on or
prior to Completion which may give rise to an Environment Liability. 

 Environment Agreements 
  

	8.6	The Company is, and has at all times been, in compliance with the Environment Agreements, and has not received notification of any claim or liability, and does not know of any
circumstances likely to give rise to a claim or liability, under any Environment Agreement. 

 Storage tanks 

  

	8.7	No underground storage tanks of any kind, including related pipework, are or have been located at any time whatsoever on or under any Property. 

 Notice of claims 
  

	8.8	At no time in the last three years have the Seller or the Company had knowledge of or received any notice, claim, demand or other communication which could give rise to an
Environment Liability. 

 Assessments, audits etc 
  

	8.9	The Seller has Disclosed and provided to the Purchaser complete copies of all assessments, audits, reports or investigations relating to the Environment, Environment Law or
Environment Liability in connection with the Properties or the Other Properties or to the operations of the Company whether in draft form (but excluding any draft reports superseded by a final version) or final form which it holds copies of and is
entitled to disclose by operation of law. 

  

 48 

 Other Properties 
  

	8.10	The Seller has Disclosed the following information in relation to the Other Properties: 

  

	 	8.10.1	address and current and former uses; and 

  

	 	8.10.2	nature of involvement of the Company, including any former property interest.  

 Asbestos 
  

	8.11	So far as the Seller is aware no claim has been made or other action taken or threatened by any employee, customer or other individual alleging exposure to asbestos in any Products
manufactured, sold, serviced, repaired or otherwise handled currently or in the past by the Company and the Seller is not aware of any circumstance which may reasonably lead to such a claim. 

  

	9.	Health and Safety  

 Compliance 
  

	9.1	So far as the Seller is aware, the Business has at all times been conducted in material compliance with all applicable legislation concerning health and safety matters and all and
any regulations or orders made or issued under any such legislation and any relevant codes of practice, guidance notes and the like issued by government agencies which are legally binding (the “Health and Safety
Legislation”). 

  

	9.2	[Intentionally left blank.]  

 Properties 
  

	9.3	No works, repairs, construction, remedial action or expenditure over £100,000 is required in relation to the Health and Safety Legislation in order to carry on the Business
lawfully at any Property. 

 Claims 
  

	9.4	The Seller is not aware of any notice, claim or other communication alleging any contravention of or actual or potential liability under the Health and Safety Legislation.

  

	10.	Other assets  

 Title

  

	10.1	The Company: 

  

	 	10.1.1	has, except insofar as this Warranty is inconsistent with paragraph 22 (Properties) and paragraph 18 (IP) (and except for assets disposed of in the ordinary course of
trading), legal and beneficial title (free from any Encumbrance, hire or hire purchase agreement or leasing agreement or agreement for payment on deferred terms) to all of its assets which: 

  

	 	(a)	are included in the Accounts; or 

  

	 	(b)	have otherwise been Disclosed as being its property; or 

  

	 	(c)	were at the Balance Sheet Date used or held for the purposes of its business; or 

  

 49 

	 	(d)	have been acquired by it since the Balance Sheet Date 

 and all such assets are in its possession and control and are sited within the United Kingdom. 
  

	 	10.1.2	has not acquired or agreed to acquire any material asset on terms that title does not pass to it until full payment is made. 

  

	 	10.1.3	owns or has the right to use all the assets used in, related to or required by the Company in order to carry on its business in the manner in which it is currently carried on.

 Condition of assets 
  

	10.2	The plant and machinery (including fixed plant and machinery) and all vehicles and office and other equipment shown in the Accounts or acquired since the Balance Sheet Date or
otherwise used in connection with the Business which have not been disposed of in the ordinary course of business: 

  

	 	10.2.1	do not so far as the Seller is aware contravene any requirement or restriction having the force of law; 

  

	 	10.2.2	are in materially good repair and condition and are regularly maintained; 

  

	 	10.2.3	are so far as the Seller is aware each capable of doing the work for which they were designed and/or purchased and will each be so capable (subject to fair wear and tear) during the
period of time over which the value of such assets will be written down to nil in the accounts of the Company; 

  

	 	10.2.4	are not surplus to the Company’s requirements; 

  

	 	10.2.5	are not so far as the Seller is aware dangerous, inefficient, out of date, unsuitable or in need of renewal or replacement; and 

  

	 	10.2.6	are so far as the Seller is aware free from asbestos, 

 and the vehicles owned by the Company are so far as the Seller is aware road-worthy and duly licensed for the purposes for which they are used. 
 Condition of stock 
  

	10.3	The Company’s stock-in-trade is in good condition and is capable of being sold by the Company in the ordinary course of business in accordance with its current price list
without rebate or allowance to a purchaser. 

 Rental payments 
  

	10.4	Rentals payable by the Company under any leasing, hire-purchase or other similar agreement to which it is a party are set out in the Disclosure Letter and have not been and are not
likely to be increased and all such rentals are fully deductible by the Company for tax purposes. 

  

	11.	Insurance 

 Extent of insurance

  

	11.1	All the assets of the Company that are of an insurable nature are adequately insured against fire and all relevant risks and the Company is and has at all material times since
11 October 1999 been adequately covered against all relevant legal liability and risks (including liability to 

  

 50 

 employees or third parties for personal injury or loss or damage to property, product liability and loss
of profit and liability to third parties in respect of errors or omissions in the provision of any professional services by the Company). 
 Premiums and claims 
  

	11.2	Particulars of all policies of insurance of the Company now in force have been Disclosed and such particulars are true and correct and all premiums due on such policies have been
duly paid and all such policies are valid and in force. So far as the Seller is aware, there are no circumstances and there is no action which the Company has or has not taken in relation to a claim that would otherwise be payable under the policy
which might lead to a repudiation of any such policy or to any liability under such insurance being avoided by the insurers in relation to a claim that would otherwise be payable under the policy or to the premiums being increased. There is no claim
outstanding under any such policies and so far as the Seller is aware there are no circumstances likely to give rise to such a claim. 

  

	12.	Litigation  

 Litigation 
  

	12.1	The Company: 

  

	 	12.1.1	except as claimant in the collection of debts (not exceeding £100,000 in the aggregate) arising in the ordinary course of trading, is not now engaged in any Litigation, and no
Litigation is in prospect, in either case by the Company or, so far as the Seller is aware, against the Company or any person for whose acts or defaults it may be vicariously liable; 

  

	 	12.1.2	has not, in the last five years preceding the date of this Agreement, been involved in any Litigation with any person who is or was a supplier, or customer, of importance to the
Company or the Business, or where such Litigation resulted in adverse publicity or loss of goodwill; and, 

  

	 	12.1.3	so far as the Seller is aware, there is no matter or fact in existence which might give rise to any Litigation involving the Company, including any which might form the basis of any
criminal prosecution against it. 

 Injunctions, etc 
  

	12.2	No injunction or order for specific performance has been granted against the Company which has not been discharged or fully complied with or is otherwise no longer in force.

 Orders and judgments 
  

	12.3	The Company is not subject to any order or judgment given by any court, tribunal or governmental agency which is still in force, nor has it given any undertaking to any court or
tribunal or to any third party arising out of any Litigation. 

  

	13.	Licences 

 General 

 

	13.1	The Company has all necessary licences (including statutory licences), permits, consents and authorities (public and private) for the proper and effective carrying on of the
Business in the manner in which the Business is now carried on and all such licences, permits, consents and authorities are valid and subsisting and the Seller knows of no reason why any of them should be suspended, cancelled or revoked whether in
connection with the sale to the Purchaser or otherwise and, so far as the Seller is aware, there are no factors that might in any way prejudice 

  

 51 

 the continuance or renewal of any of those licences, permits, consents or authorities and the Company is
not restricted by contract from carrying on any activity in any part of the world. The Company has obtained all export licences required for products exported from the United Kingdom. 
 Financial Services and Markets Act etc 
  

	13.2	The Company does not carry on or purport to carry on, nor has at any time since 28th April 1988 carried on or purported to carry on, in the United Kingdom

  

	 	13.2.1	investment business within the meaning of section 1 Financial Services Act 1986; or 

  

	 	13.2.2	any regulated activity within the meaning of section 22 Financial Services and Markets Act 2000, 

  

	  	nor has contravened any provision of either of those Acts.  

  

	  	Data Protection Act 1998 

  

	13.3	

  

	 	13.3.1	The Company has registered or applied to register itself under the Data Protection Act 1998 in respect of all registrable personal data held by it, and all due and requisite fees in
respect of such registrations have been paid. 

  

	 	13.3.2	The details contained in such registrations or applications are correct, proper and suitable for the purpose(s) for which the Company holds or uses the personal data which are the
subject of them, and the contents of all such registrations or applications have been Disclosed. 

  

	 	13.3.3	All personal data held by the Company has been held by it in accordance with the data protection principles and there has been no unauthorised disclosure of such personal data.

  

	 	13.3.4	The Company has not received any notice or complaint from any individual or regulatory authority alleging non-compliance with the Data Protection Act 1998 (including any prohibition
or restriction on the transfer of data) or claiming compensation for an injunction in respect of non-compliance with the Data Protection Act 1998. 

  

	 	13.3.5	There are no unsatisfied requests to the Company made by data subjects in respect of personal data held by it, nor any outstanding applications for rectification or erasure of
personal data. 

  

	 	13.3.6	There are no outstanding claims against the Company for compensation for inaccuracy, loss or unauthorised disclosure of personal data; nor is any personal data held by the Company
inaccurate; nor has it lost or made any unauthorised disclosure of any such data. 

  

	 	13.3.7	Without prejudice to the specific provisions above, the Company and its employees have complied in all respects with the requirements of the Data Protection Acts 1984 and 1998.

  

 52 

	14.	Trading 

  

	  	Definition 

  

	14.1	In this Agreement, “Product” means any goods, product, apparatus or equipment which the Company has manufactured, marketed, repaired, supplied or agreed to supply to any
person or put into service and includes a product which is comprised in another product (whether by virtue of being a component part or raw material or otherwise). 

  

	  	Tenders, etc 

  

	14.2	No offer, tender or the like is outstanding (the value of which to the Company could exceed £100,000 in any year) which is capable of being converted into an obligation of the
Company by an acceptance or other act of some other person. 

  

	  	Delegation of powers 

  

	14.3	There are in force no powers of attorney given by the Company other than to the holder of an Encumbrance (which has been Disclosed) solely to facilitate its enforcement nor any
other authority (express, implied or ostensible) given by the Company to any person to enter into any contract or commitment or do anything on its behalf other than any authority of employees to enter into routine trading contracts in the normal
course of their duties. 

  

	  	Consequence of acquisition of Shares by Purchaser 

  

	14.4	Nothing done in compliance with the terms of this Agreement (including acquisition of the Shares by the Purchaser) and no change in the management of the Company will:

  

	 	14.4.1	cause the Company to lose the benefit of any right or privilege it presently enjoys or so far as the Seller is aware cause any person who normally does business with the Company not
to continue to do so on the same basis as previously; 

  

	 	14.4.2	relieve any person of any obligation to the Company (either contractual or so far as the Seller is aware otherwise) or legally entitle any person to determine any such obligation or
any right or benefit enjoyed by the Company or to exercise any right, whether under an agreement with, or so far as the Seller is aware otherwise in respect of, the Company; 

  

	 	14.4.3	conflict with, or result in the breach of, or constitute a default on the part of the Company or the Seller under (i) any of the terms, conditions or provisions of any
agreement or instrument to which it is now a party; or any loan to or mortgage created by it; or (ii) its memorandum or articles of association; 

  

	 	14.4.4	result in any present or future indebtedness of the Company becoming due and payable or capable of being declared due and payable prior to its stated maturity;

  

	 	14.4.5	so far as the Seller is aware cause any director, officer or senior employee of the Company to leave employment; 

  

	 	14.4.6	conflict with, violate or result in a breach of any law, regulation, order, decree, claim form or application notice applicable to the Company or the Seller or entitle any person to
receive from the Company any finder’s fee, brokerage or other commission, 

  

	  	or, so far as the Seller is aware without having made any investigation of any such client, customer or supplier, will prejudicially affect the attitude or actions of clients,
customers and suppliers with regard to the Company. 

  

 53 

	  	The Products 

  

	14.5	At no time has the Company: 

  

	 	14.5.1	carried on any business other than the Business now carried on by the Company; or 

  

	 	14.5.2	designed, manufactured, placed on the market, installed, supplied or put into service any Product which was at the material times not fully compliant with: 

 

	 	(a)	the requirements of all applicable European laws and the laws of any territory in which such Product has been placed on the market or put into service; 

  

	 	(b)	the terms of any applicable recognised national or international product standards; or 

  

	 	(c)	any representation or warranty (whether express or implied) given in respect of such Product; or 

  

	 	14.5.3	had knowledge of or received any notice, claim, governmental enforcement action or other communication from any person alleging any defect in, or lack of fitness for purpose of, any
Product or any contravention of any applicable law or standard relating to the Products nor requiring the Company to repair or rectify any defect or default in any Product. So far as the Seller is aware, there are no circumstances which could give
rise to such a notice, claim or action. 

  

	  	Guarantees and warranties 

  

	14.6	Except for warranties or guarantees implied by law, every: 

  

	 	14.6.1	guarantee, warranty and/or representation given or made in respect of articles or trading stock sold or contracted to be sold by the Company; and 

  

	 	14.6.2	liability or obligation to service, maintain, repair, take back or otherwise do or not do anything in respect of any articles or stock that would apply after any such article or
stock has been delivered by the Company 

  

	  	(the value of which could exceed £100,000) has been Disclosed.  

  

	  	Competition/Anti-trust 

  

	14.7	The Company is not party to or directly concerned in any agreement, arrangement, understanding, practice (whether or not legally binding) or conduct which is:

  

	 	14.7.1	the subject of an investigation by the Office of Fair Trading or a reference to the Competition Commission under the provisions of the Enterprise Act 2002; 

 

	 	14.7.2	infringing Article 81 or Article 82 of the EC Treaty or section 2 or section 18 of the Competition Act 1998; 

  

	 	14.7.3	in contravention of the Consumer Credit Act 1974, the Trade Descriptions Act 1968, the Consumer Protection Act 1987 or any other provision of the Competition Act 1998 not previously
mentioned; 

  

	 	14.7.4	otherwise in contravention of the anti-trust legislation, trade regulation or similar legislation of any jurisdiction in which the Company conducts business;

  

 54 

	 	14.7.5	the subject of any investigation, inquiry or proceedings by any competent anti-trust authority or any litigation proceedings in respect of the anti-trust legislation, trade
regulation or similar legislation of any jurisdiction in which the Company conducts business; 

  

	 	14.7.6	the subject of any threatened or pending investigation, inquiry or proceedings by any competent anti-trust authority or any threatened or pending litigation proceedings in respect
of the anti-trust legislation of any jurisdiction in which the Company conducts business; 

  

	 	14.7.7	subject to any existing or pending decisions, judgments, orders or rulings of or undertakings given to any competent anti-trust authority or other competent body in any jurisdiction
in which the Company conducts business; and 

  

	  	the Company is not in receipt of any payment, guarantee, financial assistance or other aid from a government or other state body which was not, but should have been, notified to the
European Commission under Article 88 of the EC Treaty for a decision declaring such aid to be compatible with the common market. 

  

	  	Restrictions on trading 

  

	14.8	The Company is not and has not been a party to any agreement, arrangement, understanding or practice restricting its freedom to provide and take goods and services by such means and
from and to such persons and into or from such place as it may from time to time think fit other than as Disclosed. 

  

	  	Possession of records 

  

	14.9	All title deeds and agreements to which the Company is a party, and all other documents owned by it, are in its possession or so held; and none of its records, systems, controls,
data or information is recorded, stored, maintained, operated or otherwise wholly or partly dependent on or held by any means (including any electronic, mechanical or photographic process, whether computerised or not) which (including all means of
access to and from them) are not under the exclusive ownership and direct control of the Company. 

  

	  	Business names 

  

	14.10	The Company does not use on its letterhead, books or vehicles or otherwise carry on its business under any name other than its corporate name. 

  

	  	Unlawful acts 

  

	14.11	None of the Company or its existing officers or, so far as the Seller is aware, any of its previous officers have been prosecuted for any criminal, illegal or unlawful act connected
with the Company. 

  

	  	Inducements 

  

	14.12	No officer or employee of the Company has (in connection with the Business or otherwise) directly or indirectly offered, given, procured or received any gift, loan, fee, reward,
advantage or other consideration which: 

  

	 	14.12.1	is deemed illegal under the Prevention of Corruption Acts 1889 to 1916 and/or Part 12 of the Anti-terrorism, Crime and Security Act 2001, or which has contravened, or was intended
to result in the contravention of, the laws of any jurisdiction (including in particular but without limitation the US Foreign Corrupt Practices Act); or 

  

 55 

	 	14.12.2	(whether or not it is unlawful) is in the nature of a bribe, influence payment or kickback or similarly has an ulterior or covert purpose; 

  

	  	or has agreed, conspired or attempted to, or assisted any other person to, do any such thing. 

  

	  	Previous Business Acquisitions 

  

	14.13	Other than as Disclosed, the Company has not acquired any business or material asset from a third party or from any member of the Retained Group. 

  

	15.	Contracts 

  

	  	Material contracts 

  

	15.1	All contracts to which the Company is a party with a value in excess of £100,000 in the last twelve months prior to Completion, and all contracts with the 10 largest customers
and 10 largest suppliers of each Company, have been Disclosed and the Company is not a party to or subject to any agreement, transaction, obligation, commitment, understanding, arrangement or liability which: 

  

	 	15.1.1	cannot readily be fulfilled or performed by the Company on time and without undue or unusual expenditure of money and effort; or 

  

	 	15.1.2	requires the Company to pay any commission, finder’s fee, royalty or the like; or 

  

	 	15.1.3	is in any way otherwise than in the ordinary and proper course of the Company’s business. 

  

	  	Performance of contracts 

  

	15.2	

  

	 	15.2.1	The terms of all the Company’s contracts have been complied with by it and, so far as the Seller is aware, by the other parties to the contracts in all material respects and
there are no circumstances likely to give rise to a default by it or (so far as the Seller is aware) by any other party under any such contract. 

  

	 	15.2.2	There are no outstanding claims, separately or in the aggregate, of material amounts, against the Company on the part of customers or other persons in respect of defects in quality
or delays in delivery or completion of contracts or deficiencies of design or performance or otherwise relating to liability for goods or services sold or supplied by it and no such claims are threatened or (so far as the Seller is aware)
anticipated and (so far as the Seller is aware) there is no matter or fact in existence in relation to goods or services currently sold or supplied by it which might give rise to any such claim. 

  

	 	15.2.3	The Seller has no knowledge of the invalidity of or grounds for rescission, avoidance or repudiation of any agreement or other transaction to which it is a party or in relation to
which it otherwise purports to have enforceable rights and it has received no notice of any intention to terminate, repudiate or disclaim any such agreement or other transaction. 

  

	  	Agency and distribution agreements 

  

	15.3	The Company is not a party to any subsisting agency or distributorship agreement with a value in excess of £100,000 in the twelve months prior to Completion.

  

 56 

	16.	Employees 

  

	  	Particulars of employees 

  

	16.1	So far as the Seller is aware, the particulars shown in the schedule of employees that has been Disclosed are true and complete and show in respect of each director, officer or
employee of the Company his date of birth (if available), the date on which he commenced continuous employment with the Company for the purposes of the ERA and all remuneration payable and other benefits provided or which the Company is bound to
provide to each such person and full particulars of all remuneration arrangements (particularly profit sharing, incentive, bonus and severance arrangements to which the Company is a party) and each director, office, employee and worker of the
Company is Disclosed. 

  

	  	Contracts of employment 

  

	16.2	Copies of all written contracts of employment in force between the Company and any of its directors, officers or employees (and so far as the Seller is aware any material terms of
employment that are not in writing) have been Disclosed. There are no consultancy, agency or management services agreements in existence between the Company and any other person, firm or company, and there are no legally binding agreements between
the Company (or any employers’ or trade association of which the Company is a member) and any recognised Trade Union or works council or staff association. There are no outstanding pay negotiations with any employees or recognised Trade Unions.

  

	  	Benefits 

  

	16.3	There are no amounts owing to present or former directors, officers or employees of the Company other than not more than one month’s arrears of remuneration (including any
bonuses, benefits or other employment-related payments) accrued or due or for reimbursement of business expenses incurred within a period of three months preceding the date of this Agreement and no moneys or benefits other than in respect of
remuneration or emoluments of employment are payable to or for the benefit of any present or former director, officer or employee of the Company, nor any dependant of any present or former director, officer or employee of the Company.

  

	  	Liabilities and payments 

  

	16.4	So far as the Seller is aware and except to the extent (if any) to which full provision or allowance has been made in the Accounts: 

  

	 	16.4.1	no liability has been incurred or is reasonably anticipated by any senior member of the Human Resources department of the Company for breach of any contract of employment or for
severance payments or for redundancy payments or protective awards or for compensation for unfair dismissal or for failure to comply with any order for the reinstatement or re-engagement of any employee or for sex or race or disability
discrimination or for any other liability (statutory, contractual or otherwise) accruing from the termination or variation of any contract of employment or (in respect of any discrimination claims only) for services; 

  

	 	16.4.2	no gratuitous payment has been made or promised by the Company in connection with the actual or proposed termination, suspension or variation of any contract of employment of any
present or former director, officer or employee or any dependant of any present or former director, officer or employee of the Company; and 

  

	 	16.4.3	the Company has not made or agreed to make any payment to, or provided or agreed to provide any benefit or change in terms and conditions of employment for, any of its present or
former directors, officers or employees in connection with the sale and purchase contemplated by this Agreement. 

  

 57 

	  	Relevant legislation 

  

	16.5	

  

	 	16.5.1	The Company has in relation to each of its employees (and so far as relevant to each of its former employees) complied with: 

  

	 	(a)	all material obligations imposed on it by all relevant statutes or statutory instruments affecting its employment of any persons and all relevant orders and awards made thereunder
and has maintained records regarding the service, terms and conditions of employment of each of its employees; and 

  

	 	(b)	all collective agreements and recognition agreements for the time being affecting its employees or their conditions of service. 

  

	 	16.5.2	The Company has not been served with any improvement and/or prohibition notices pursuant to sections 21 and 22 of the Health and Safety at Work etc Act 1974, nor is any prosecution
or sentence pending for any (alleged) offence under that Act. 

  

	 	16.5.3	So far as the Seller is aware, the Company is not in breach of any of the provisions on the employment of young persons contained in the Health and Safety (Young Persons)
Regulations 1997, the Children (Protection at Work) Regulations 1998 or the Working Time Regulations 1998 and is not presently being prosecuted under any of such provisions. 

  

	 	16.5.4	There is no liability awarded by a court or tribunal or claim against the Company outstanding under the Equal Pay Act 1970, the Sex Discrimination Acts 1975 and 1986, the Race
Relations Act 1976, the Disability Discrimination Act 1995, ERA, TUPE, the Social Security Contributions and Benefits Act 1992, TULRCA, the Working Time Regulations 1998, the National Minimum Wage Regulations 1999 or the Part-time Workers
(Prevention of Less Favourable Treatment) Regulations 2000, the Part-time Workers (Prevention of Less Favourable Treatment) Regulations 2000, the Fixed Term Employees (Prevention of Less Favourable Treatment) Regulations 2002 or the Employment Act
2002, the Employment Equality (Sexual Orientation) Regulations 2003, the Employment Equality (Religion or Belief) Regulations 2003 and the Employment Equality (Age) Regulations 2006. 

  

	 	16.5.5	Within a period of one year preceding the date of this Agreement, the Company has not given notice of any redundancies to the Secretary of State or started consultations with any
independent trade union or workers’ representatives under the provisions of Part IV TULRCA or under TUPE nor has it failed to comply with any such obligation under Part IV TULRCA or under TUPE. 

  

	  	Termination of employment 

  

	16.6	None of the present directors, officers or employees of the Company has given or received notice terminating his employment except as expressly contemplated under this Agreement and
Completion of this Agreement will not entitle any director, officer, employee to terminate his employment or trigger any entitlement to a severance payment or liquidated damages; and the Company has complied with all specific recommendations made to
it by the Advisory Conciliation and Arbitration Service and with all awards and declarations made to it by the Central Arbitration Committee in respect of its employees or any Trade Union. 

  

	  	Share and other schemes 

  

	16.7	 The Company does not have in existence and is not proposing to introduce, and none of its directors, officers or employees participates in (whether or not
established by the relevant Company), any employee share option plan, employee share trust, share incentive scheme, share 

  

 58 

	 	 
option scheme or profit sharing scheme for the benefit of all or any of its present or former directors, officers or employees or the dependants of any of
such persons or any scheme under which any of its present or former directors, officers or employees is entitled to a commission or remuneration of any other sort calculated by reference to the whole or part of the turnover, profits or sales of the
Company or any other person, firm or company including any profit related pay scheme established under Chapter III, Part V TA 88. 

  

	  	Disputes and claims 

  

	16.8	No: 

  

	 	16.8.1	dispute exists or can reasonably be anticipated (by any senior member of the Human Resources Department of the Company) between the Company and a material number or category of its
employees or any Trade Union(s) or works council and, so far as the Seller is aware, there are no wage or other claims outstanding against the Company by any person who is now or has been a director, officer or employee of the Company; and

  

	 	16.8.2	form of official industrial action by the Company’s employees or workers or any lock out has occurred during the last three years, nor, so far as the Seller is aware, is any
reasonably anticipated by any senior member of the Human Resources Department of the Company, which has caused, or is likely to cause, the Company to be materially incapable of carrying on its business in the normal and ordinary course.

  

	  	Transfer of undertakings 

  

	16.9	The Company has not: 

  

	 	16.9.1	been a party to any relevant transfer as defined in TUPE; or 

  

	 	16.9.2	failed to comply with any duty to inform and consult any Trade Union or employees’ or workers’ representatives under TUPE 

  

	  	within the period of one year preceding the date of this Agreement. 

  

	  	Agreements with Trade Unions 

  

	16.10	The Company is not a party to any agreement or arrangement with or commitment to any trade unions or staff association and, so far as the Seller is aware, no application for
collective bargaining – recognition by a recognised Trade Union is pending in relation to the Company under Schedule Al of TULRCA. 

  

	17.	Pension Schemes 

  

	  	General 

  

	17.1	All material details of the Pension Schemes, the Company’s obligations in respect of them, the trustees (where appropriate) and those of the employees who are members have been
Disclosed and no proposal has been announced or made by the Company to amend any of the Pension Schemes. 

  

	17.2	Other than as Disclosed, there are no other Pension Schemes for current or past directors or employees of the Company and no other schemes that the Company, or any part of it, has
ever participated in as an employer. 

  

	  	Benefits, discretions and funding 

  

	17.3	In relation to each Pension Scheme: 

  

 59 

	 	17.3.1	no power to augment benefits has been exercised; 

  

	 	17.3.2	no discretion has been exercised to admit an employee to membership of the pension scheme who would not otherwise be eligible; 

  

	 	17.3.3	no discretion has been exercised to provide a benefit which would not otherwise be provided; 

  

	 	17.3.4	all benefits (other than a refund of contributions with interest where appropriate) payable under the pension scheme on the death of a member while in an employment to which the
pension scheme relates or during a period of sickness or disability of a member are fully insured by a policy with an insurance company of good repute. Each member has been covered for insurance by the insurance company at its normal rates and on
its normal terms for persons in good health and all premiums payable have been paid; 

  

	 	17.3.5	there are no contributions to the Pension Scheme which are due but unpaid and have remained unpaid for more than one month and in any event contributions have been paid which are at
least equal to and by the due date specified in any schedule of contributions or payments applicable under section 58 or 87 Pensions Act 1995; and 

  

	 	17.3.6	other than benefits payable on death as Disclosed, it provides only money purchase benefits within the meaning of section 181 Pension Schemes Act 1993. None of the Companies have
given any assurance, promise or guarantee (whether oral or written) to any person as to the level or amount of benefit to be provided and, so far as the Seller is aware, no other person has given such assurance, promise or guarantee.

  

	  	Administration 

  

	17.4	Each Pension Scheme: 

  

	 	17.4.1	is a registered pension scheme under Chapter 2 of Part 4 of the Finance Act 2004 and, so far as the Seller is aware, there is no reason why such registered status might be withdrawn
under section 157 of that Act; 

  

	 	17.4.2	has not been the subject of any report of wrongdoing or irregularities by the Companies to the Pensions Regulator and, so far as the Seller is aware, no other person has made such a
report and there are no circumstances which would justify such a report; 

  

	 	17.4.3	is a scheme in respect of which all actuarial, consultancy, legal and other fees, charges or expenses have been paid and for which no services have been provided for which an
account or invoice has not been rendered; and 

  

	 	17.4.4	has been, so far as the Seller is aware, administered in accordance with all applicable laws, regulations and requirements and all applicable requirements of any governmental body
or regulatory authority. 

  

	  	Claims 

  

	17.5	So far as the Seller is aware, no claim has been threatened or made or litigation commenced against the trustees or administrator of any Pension Scheme or against the Company or any
other person whom the Company is or may be liable to indemnify or compensate in respect of any matter arising out of or in connection with any Pension Scheme. So far as the Seller is aware, there are no circumstances that may give rise to any such
claim or litigation. There are no unresolved disputes under any Pension Scheme’s internal dispute resolution procedure. 

  

 60 

	  	Stakeholder pension arrangements 

  

	17.6	The Company has complied with all obligations imposed by the Welfare Reform and Pensions Act 1999 and any regulations made under it regarding facilitating access to all of its
relevant employees (as defined in that Act) to a stakeholder pension arrangement and 

  

	 	17.6.1	there is no obligation on the Company to pay contributions to a stakeholder pension arrangement in respect of any employee or officer of the Company; and 

 

	 	17.6.2	there are no claims or actions in progress or pending, nor, so far as the Seller is aware, any reason for such claims or actions involving any employee or officer of the Company in
connection with a stakeholder pension arrangement. 

  

	18.	Intellectual Property Rights 

  

	  	Definitions 

  

	18.1	In this Agreement: 

  

	  	“Intellectual Property Rights” means patents, rights to inventions, copyright and related rights, trade marks, service marks and trade names, domain names, rights
in get-up, rights to goodwill or to sue for passing off or unfair competition, rights in designs, rights in computer software, database rights, rights in confidential information (including Know-How) and any other intellectual property rights or
rights of a similar nature, in each case whether registered or unregistered, and including all applications (or rights to apply) for, and renewals or extensions of, such rights and all similar or equivalent rights or forms of protection which
subsist or will subsist now or in the future in any part of the world; 

  

	  	“Know-How” means all inventions, improvements, modifications, processes, formulae, models, prototypes and sketches, drawings, plans or specifications or any other
matters made, devised, developed or discovered by the Company, alone or with one or more others, relating to or otherwise in connection with the Business; 

  

	  	“Licences In” means licences, agreements, authorisations and permissions pursuant to which the Company uses, exploits or holds (or is permitted to use, exploit or
hold) any Intellectual Property Rights belonging to any third party; 

  

	  	“Licences Out” means licences, agreements, authorisations and permissions pursuant to which the Company authorises or permits the use of any Intellectual Property
Rights belonging to or otherwise held by the Company. 

  

	  	Not Licences In or Licences Out 

  

	18.2	Complete and accurate particulars of all registered Intellectual Property Rights and all material unregistered Intellectual Property Rights owned, used or exploited by the Company
(other than Intellectual Property Rights used or exploited by the Company pursuant to Licences In) are set out in Part 1 and Part 2 of Schedule 3 (Intellectual Property) respectively. 

  

	  	Licences In 

  

	18.3	Complete and accurate particulars of all registered Intellectual Property Rights and all material unregistered Intellectual Property Rights used or exploited by the Company pursuant
to Licences In (in whatever form and whether express or implied) are set out in Parts 3 and 4 of Schedule 3 (Intellectual Property) respectively. 

  

	  	Licenses Out 

  

	18.4	The Company has not entered into any Licences Out of its Intellectual Property Rights. 

  

 61 

	  	No other Intellectual Property Rights required 

  

	18.5	The Company does not require any Intellectual Property Rights other than those set out in Parts 1, 2, 3 and 4 of Schedule 3 (Intellectual Property) in order to carry on the
Business. 

  

	  	Sole owner or applicant 

  

	18.6	Except in respect of Intellectual Property Rights used, exploited or held by the Company pursuant to the Licences In as set out in Parts 3 and 4 of Schedule 3, the Company is the
sole legal and beneficial owner of (or applicant for) the Intellectual Property Rights used by the Company including, without limitation, those set out in Part 1 of Schedule 3, free from all Encumbrances. 

  

	  	Valid, subsisting and enforceable 

  

	18.7	The Intellectual Property Rights owned by the Company, including without limitation those set out in Part 1 of Schedule 3, are valid, subsisting and enforceable and nothing has been
done or not been done as a result of which any of them has ceased or might cease to be valid, subsisting or enforceable. In particular: 

  

	 	18.7.1	all application and renewal fees and other steps required for the prosecution, maintenance or protection of such rights have been paid on time or taken; 

  

	 	18.7.2	so far as the Seller is aware, no trade marks, service marks, trade names, or domain names, identical or similar to any such rights, has been registered or is being used by any
person in the same, or a similar, business to that of the Company in any country in which the Company has registered or is using that trade mark, service mark, trade name or domain name; 

  

	 	18.7.3	all confidential information (including Know-How) has been kept confidential and has not been disclosed to third parties (other than persons who have signed written confidentiality
undertakings in respect of such information, details of which have been Disclosed); 

  

	 	18.7.4	there are no pending or outstanding claims against the Company for compensation under the Patents Act 1977 or equivalent legislation worldwide; 

  

	 	18.7.5	there are and have been no claims, challenges, disputes or proceedings, pending or threatened, in relation to the ownership, validity or use of such rights.

  

	  	No omission 

  

	18.8	Nothing is due to be done within 30 days of Completion the omission of which would jeopardise the prosecution, maintenance or protection of any of the Intellectual Property Rights
owned or used by the Company (other than Intellectual Property Rights used or exploited by the Company pursuant to Licences In) which are registered or the subject of an application for registration. 

  

	  	Applications 

  

	18.9	So far as the Seller is aware, there are no factors that would cause any applications for registration of any Intellectual Property Rights to be unacceptable to any body to which
the application is being made. 

  

	  	Licences In valid etc 

  

	18.10	The Licences In: 

  

 62 

	 	18.10.1	are valid and binding (so far as the Seller is aware) and nothing has been done or not been done by the Seller, or, so far as the Seller is aware, by any third party, as a result of
which any of them has ceased or might cease to be valid; 

  

	 	18.10.2	have not been the subject of any breach or default by the Company or, so far as the Seller is aware, any party or any event which, with the giving of notice or lapse of time, would
constitute a default by the Company; 

  

	 	18.10.3	are not, and have not been, the subject of any claim, dispute or proceeding, pending or threatened; 

  

	 	18.10.4	have, where required, been duly recorded or registered; and 

  

	 	18.10.5	have been fully paid up as at the Completion Date, 

  

	  	and the Seller has no reason to believe that there is any cause for any Licence In to come to an end or be restricted except in accordance with its terms. 

 

	  	No infringement etc 

  

	18.11	No Intellectual Property Rights (excluding for the avoidance of doubt any Licence In) owned or used by the Company now or previously: 

  

	 	18.11.1	have infringed or infringe the Intellectual Property Rights of any third party; or 

  

	 	18.11.2	have constituted or constitute of any duty of confidence, passing off or actionable act of unfair competition; or 

  

	 	18.11.3	have given or give rise to any obligation to pay any royalty, damages or other sum. 

  

	18.12	So far as the Seller is aware, no activities of the Company or of any licensee of the Company in respect of the Licences In: 

  

	 	18.12.1	have infringed or infringe the Intellectual Property Rights of any third party; or 

  

	 	18.12.2	have constituted or constitute any breach of any duty of confidence; or 

  

	 	18.12.3	have constituted or constitute passing off or actionable act of unfair competition; or 

  

	 	18.12.4	have given or give rise to any obligation to pay any royalty.  

  

	  	Change of control 

  

	18.13	No change of control of the Company will result in the termination of, or materially affect, any of the Intellectual Property Rights set out in Parts 3 and 4 of Schedule 3
(Intellectual Property). 

  

	  	Confidential information 

  

	18.14	In relation to rights in confidential information comprising Intellectual Property Rights: 

  

	 	18.14.1	all such confidential information is in the lawful possession of the Company; 

  

	 	18.14.2	the Company has not disclosed or permitted to be disclosed any such information (other than to the extent necessary in the ordinary course of business or for the purpose of
disclosure to its professional advisers) to any person except the Purchaser; 

  

	 	18.14.3	the Company does not own rights in any confidential information which may be capable of patent protection or which, if disclosed other than subject to conditions of

  

 63 

	 	  	confidentiality, might have a material adverse effect on any business carried on by the Company; 

  

	 	18.14.4	so far as the Seller is aware, no activity of any third party constitutes or is likely to constitute any breach of any duty of confidence owed to the Company; and

  

	 	18.14.5	no activity of the Company constitutes or is likely to constitute any breach of any duty of confidence owed by the Company to any third party. 

  

	19.	Information technology and telecommunications 

  

	  	Definitions 

  

	19.1	In this Agreement: 

  

	  	“IT Contracts” means any agreements, licences or other contractual arrangements with third parties relating to the IT Systems or IT Services, including licences of
all software, leases of hardware and other procurement of IT Systems or IT Services; 

  

	  	“IT Services” means any services relating to the IT Systems or to any other aspect of the Company’s data processing or other technology requirements, including
software development, support or maintenance, consultancy, source code deposit, recovery and network services, facilities management or hardware maintenance; and 

  

	  	“IT Systems” means all computer programs (in both source and object code form), computer hardware and peripherals, telecommunications and network equipment owned,
used, leased or licensed in by or to the Company. 

  

	  	Ownership and control 

  

	19.2	All IT Systems material to the operation of the Company have been identified in Part 1 of Schedule 4 (Information Technology). 

  

	  	Operation 

  

	19.3	So far as the Seller is aware: 

  

	 	19.3.1	all IT Systems are in good working order, function in accordance with all applicable specifications and have been, and are being, properly and regularly maintained and replaced;

  

	 	19.3.2	no part of the IT Systems has materially failed to function or has otherwise materially interrupted or hindered the operation of the business of the Company at any time during the 2
years prior to the date of this Agreement; and 

  

	 	19.3.3	all IT Services are being, and have been, provided in accordance with all applicable specifications. 

  

	  	Access 

  

	19.4	The Company has full and unrestricted access to, and use of, the IT Systems and no third party agreements or consents are required to enable the Company to continue such access and
use following Completion. 

  

 64 

	  	Domain names 

  

	19.5	The Company is the registrant and beneficial owner of the domain names specified in Part 2 of Schedule 4 (Information Technology) and those domain names do not infringe the
Intellectual Property Rights of any third party. 

  

	  	Websites 

  

	19.6	All websites operated by the Company have been created or developed by the Company or pursuant to IT Contracts that vest the legal and beneficial ownership of all copyright and all
other Intellectual Property Rights in such websites in the Company and, so far as the Seller is aware, the content of the websites does not infringe the Intellectual Property Rights of any third party. 

  

	  	IT Contracts 

  

	19.7	The IT Contracts: 

  

	 	19.7.1	are so far as the Seller is aware valid and binding and nothing has been done or not been done as a result of which any of them has ceased or might cease to be valid;

  

	 	19.7.2	have not been the subject of any breach or default by the Company or, so far as the Seller is aware, any party and are not otherwise liable to be adversely affected by the
transactions contemplated by this Agreement; and 

  

	 	19.7.3	are not, and have not been, the subject of any claim, dispute or proceeding, pending or threatened. 

  

	19.8	The IT Contracts in relation to the software used in the Business are listed in part 3 of Schedule 4, are licensed to the Company and have been fully paid up to the Completion Date
by the Company. 

  

	20.	Legislation 

  

	20.1	So far as the Seller is aware the Company is not in breach of, nor has it received notice of, nor is it aware of, any allegation of breach of, the requirements of any legislation
that is applicable to it. 

  

	21.	Information 

  

	21.1	The information set out in Schedules 1 to 4 (inclusive) is complete, true, accurate and not misleading. Insofar as any such information amounts to a forecast or an expression of
opinion, intention or expectation, such information is, so far as the Seller is aware, fair and honest and made on reasonable grounds. 

  

	22.	Properties 

  

	22.1	The Properties comprise all the land owned, controlled, used or occupied by the Company, and all the estates, interests or rights vested in the Company relating to any land, at the
date of this Agreement. 

  

	22.2	The Company has no liability (whether actual, contingent or otherwise) as tenant, assignee, guarantor, covenantor or otherwise arising from or relating to any estate, interest or
right in any land other than the Properties. 

  

	22.3	The Company’s title to each Property for the estate or interest is as set out in Schedule 2 and free from any Encumbrances, any agreements for sale or lease, options or rights
of pre-emption. 

  

 65 

	22.4	Any Letting Documents to which any Property is subject are referred to in Part 3 of Schedule 2. Otherwise the Company is in actual occupation of each of the Properties on an
exclusive basis and, except by virtue of the Letting Documents, no person, other than the Company, has any right (actual or contingent) to possession, occupation or use of or interest in the Properties. 

  

	22.5	Complete and accurate copies of all Leases and Letting Documents have been Disclosed and the Company has not received notice or allegation of any breach of any of the Leases or
Letting Documents. 

  

	22.6	The documents of title relating to each Property consist of original documents or properly examined abstracts, all of which are in the possession of the Company or are
unconditionally held to its order. 

  

	22.7	The Property held under the lease dated 4 December 2000 made between Burry and Knight Limited (1) and Devlin Electronics Limited (2) has a water supply and discharges
effluent via adopted public service media. 

  

	22.8	The Seller is not aware of any disputes, claims, actions, demands or complaints which are outstanding in relation to any Property and the Seller is not aware of any notices
materially affecting the Property have been given or received. 

  

	22.9	The Property is not subject to any outgoings other than the uniform business rate or water rates (and sums due under any Lease including rent, insurance and service charge) and all
such payments have been made to date. 

  

	22.10	The current use of each Property is as set out in column (5) of Part 1 Schedule 2 and the Company is not aware of any enforcement proceedings having been commenced or notices
served and no such proceedings or notices have been proposed. 

  

	22.11	The Seller is not aware of any notice or allegation of any breach of any laws, regulations, restrictions, covenants or obligations from any person. 

  

	22.12	So far as the Seller is aware, there is no outstanding order, notice or other requirement of any local or other authority affecting the Property or involving expenditure in
compliance with it nor any circumstances which may result in any such order or notice being made or served. 

  

	22.13	In relation to each Property where the Company’s tenure is leasehold: 

  

	 	22.13.1	the current rent payable (being rent only) is set out in Part 1 of Schedule 2. The last instalment of rent was paid to and was accepted by the landlord without qualification; and

  

	 	22.13.2	all steps in rent reviews have been duly taken and no rent reviews are or should be currently under negotiation or the subject of a reference to an expert or arbitrator or the
courts and, where appropriate, evidence of the agreement or determination of the current rent has been placed with the documents of title; and 

  

	 	22.13.3	sections 24 to 28 Landlord and Tenant Act 1954 have not been excluded in relation to the tenancy created by the Lease. 

  

	22.14	The lease dated 4 January 1993 between Openmen Limited (1) and Muirhead Vactric Components Limited (2) was determined by effluxion of time. There are no outstanding
tenant’s liabilities under this lease. 

  

	22.15	There are no outstanding tenant’s liabilities under the agreement for lease referred to in paragraph 1.2.10 of the Second Schedule of the lease dated 4 December 2000 made
between Burry and Knight Limited (1) and Devlin Electronics Limited (2). 

  

 66 

	22.16	The Seller is not aware of any unusual or otherwise onerous conditions contained in Planning consents 0065823 relating to the Property at Southall and 65823 30/03/1999 relating to
the Property at Ringwood which prevent the existing use of those properties. 

  

 67 

 Part 2 
 Taxation Warranties 
  

	23.	General 

  

	23.1	Provision or reserve has been made in the Accounts in accordance with UK GAAP for all Taxation liable to be assessed on the Company or for which the Company is accountable
(whether primarily or otherwise) in respect of all income, profits or gains earned, accrued or received on or before the Balance Sheet Date or deemed to have been or treated as earned, accrued or received for Taxation purposes on or before the
Balance Sheet Date and/or in respect of any event occurring or deemed to have occurred on or before the Balance Sheet Date, including distributions made on or before the Balance Sheet Date or provided for in the Accounts. 

 

	23.2	Provision has been made in the Accounts for deferred Taxation in accordance with UK GAAP. 

  

	24.	Payment of Tax 

  

	24.1	The Company has properly paid all Taxation prior to Completion which it has become liable to pay prior to Completion and it has not within the last six years paid or become liable
to pay, nor so far as the Seller is aware are there any circumstances which may cause it to become liable to pay, any penalty, fine, surcharge or interest in connection with Taxation. 

  

	24.2	All payments by the Company to any person which ought to have been made under deduction or withholding of Taxation have been so made and the Taxation so deducted or withheld has
been properly and punctually accounted to the relevant Taxation Authority. 

  

	25.	Compliance 

  

	25.1	In the six years prior to Completion, the Company has made all returns, claims for relief, applications, notifications, computations, reports, accounts, statements, registrations
and assessments (whether physically in existence or electronically stored) (“Returns”) it is required by law to make. All Returns have been properly submitted by the Company within any relevant time limits to each relevant Taxation
Authority and the Returns so far as the Seller is aware give full disclosure of all material facts and circumstances and so far as the Seller is aware are not likely to be the subject of any question or dispute with any Taxation Authority.

  

	25.2	In the six years prior to Completion, the Company has prepared, kept and preserved sufficient records to enable it to make and complete returns for Taxation purposes and to
calculate the liability to Taxation or the amount of a Relief arising on the disposal of any asset owned at the Balance Sheet Date or acquired since the Balance Sheet Date but before Completion and otherwise as required by law.

  

	25.3	The Disclosure Letter contains details so far as they affect the Company of all arrangements with any Taxation Authority current at Completion that are not based on a strict
application of the law relating to Taxation (other than published extra-statutory concessions, statements of practice and statements of a similar nature) and so far as the Sellers is aware no such arrangement is liable to be withdrawn for any
reason. 

  

	25.4	The Company is not in dispute with any Taxation Authority and so far as the Seller is aware there are no circumstances that exist which are likely to give rise to any such dispute.
No Taxation Authority has, within the past 12 months, investigated or indicated in writing that it may investigate the Company’s Taxation affairs and so far as the Seller is aware the Company is not subject to any ongoing investigation.

  

	25.5	All particulars furnished to any Taxation Authority in connection with an application for any consent or clearance made on behalf of or affecting the Company during the last six
years were made to the appropriate office, section, department or body and disclosed all material facts, 

  

 68 

 circumstances and (where appropriate) law material to the decision of the relevant Taxation Authority and
any such consent or clearance given remains valid and effective and any transaction for which such consent or clearance has previously been obtained has been carried into effect (if at all) in all material respects in accordance with the terms of
the relevant application, consent or clearance. 
  

	26.	Taxation Claims Reliefs and Liabilities 

  

	26.1	In the six years prior to Completion, no Company pursuant to an indemnity, guarantee or covenant other than in the ordinary course of its trade and relating to the sale of capital
assets subject to the TCGA provisions or shares has agreed to meet or pay a sum equivalent to or by reference to another person’s liability to Taxation. 

  

	26.2	There is no charge referred to in section 237 Inheritance Tax Act 1984 outstanding in respect of any asset of the Company or the Shares. 

  

	27.	Corporation Tax/Capital Allowances 

  

	27.1	The Disclosure Letter sets out full particulars of all claims and elections made (or assumed in the Accounts to be made) under Sections 152, 162, 175 or 179B of the TCGA and
paragraphs 40, 56, 65 or 67 Schedule 29 Finance Act 2002 insofar as they could affect the chargeable gain or allowable loss which would arise in the event of a disposal after the Completion Date by the Company of any of its assets.

  

	27.2	The Company has not since the Balance Sheet Date made any distribution within the meaning of section 209 TA 88 (meaning of “distribution”) save for any dividend disclosed
in the Accounts nor is it bound to make such a distribution. 

  

	27.3	In the six years prior to Completion, the Company has not at any time repaid, redeemed or repurchased or agreed to repay, redeem or repurchase or granted an option under which it
may become liable to purchase any shares of any class of its issued share capital nor has the Company capitalised or agreed to capitalise in the form of shares or debentures any profits or reserves of any class or description or otherwise issued or
agreed to issue any share capital other than for receipt of new consideration (within the meaning of Part VI TA 88) or passed or agreed to pass any resolution to do so. 

  

	27.4	In the six years prior to Completion , no rents, interest, annual payments or other sums of an income nature paid or payable by the Company or which the Company is under an existing
obligation to pay in the future are or may be wholly or partially disallowable as deductions, management expenses or charges in computing profits for the purposes of corporation tax to the extent that they have been reflected as allowable
deductions, management expenses and charges in tax returns submitted prior to Completion. 

  

	27.5	Under current law, all expenditure which the Company has incurred in the six years prior to Completion or may incur under any subsisting commitment on the provision of machinery,
plant or buildings has qualified or will qualify (if not deductible as a trading expense for trade carried on by the Company) for writing-down allowances or industrial building allowances (as the case may be) under CAA to the extent that it has been
reflected as qualifying expenditure in tax returns submitted prior to Completion. In relation to expenditure incurred but for which no claim has been made a claim made in the Company’s next corporation tax self assessment return for such
allowances in respect of such expenditure would not be barred by virtue of section 58(4), CAA. 

  

	27.6	The Company has not in the past six years incurred any long-life asset expenditure within the meaning of section 90, CAA. 

  

 69 

	27.7	None of the assets of the Company expenditure on which has qualified for a capital allowance under Part 3, CAA in the past six years has at any time been used otherwise than as an
industrial building or structure. 

  

	28.	Close Companies 

  

	28.1	The Company is not nor has it been in the last six years a close company within the meaning of sections 414 and 415 TA 88. 

  

	29.	Tax Avoidance 

  

	29.1	The Company has not entered into or so far as the Seller is aware been a party to any scheme, arrangement or transaction designed wholly or mainly, for the purpose of avoiding or
reducing a liability to Taxation. 

  

	29.2	The Company has not been party to any arrangements, transaction or series of transactions which it has or may become liable to notify to any Tax Authority under any legislation
requiring the disclosure of tax avoidance schemes. 

  

	30.	Value Added Tax 

  

	30.1	Each Company has, throughout the whole of the period beginning three years before the Balance Sheet Date and ending on the date hereof, been registered and been eligible to be
registered and is a taxable person for the purposes of the VATA and such registration is not subject to any conditions imposed by or agreed with HM Revenue and Customs (“HMRC”) 

  

	30.2	Each Company has complied with the terms of all statutory provisions, regulations, directions, conditions, notices and agreements with HMRC relating to VAT. The Company has not been
required by HMRC to give security. 

  

	30.3	All supplies of goods and services made by the Company are taxable supplies for the purposes of the VATA and all input tax is deductible in accordance with the provisions of
sections 25 and 26 VATA. 

  

	30.4	Neither the Company nor any relevant associate (within the meaning of paragraph 3(7) Schedule 10 VATA) has made any election under paragraph 2(1) Schedule 10 VATA in respect of any
land in, over or in respect of which the Company has any interest, right or licence to occupy and the Company has no obligation to make such an election. 

  

	30.5	The Company does not own any assets which are capital items subject to the Capital Goods Scheme under Part XV of the VAT Regulations 1995. 

  

	31.	Share Schemes/Restricted Securities 

  

	31.1	The Company has not established (or is a participant in) any bonus, share option, profit related pay or other scheme or arrangement, whether or not approved by HMRC, for the benefit
of its current or former officers or employees or any of them. 

  

	32.	International 

  

	32.1	The Company was incorporated in and is and for the six years prior to Completion has been resident only in the United Kingdom for Taxation purposes and for the purposes of any
double taxation agreement. The Company is not liable to, and has at no time in the past six years incurred any, or is required to be registered for any Taxation in any jurisdiction other than the United Kingdom or had a branch outside the United
Kingdom or any permanent establishment (as that expression is defined in the respective double taxation relief orders current at the date of this Agreement) outside the United Kingdom. 

  

 70 

	32.2	The Company has not without the prior consent of HM Treasury, or without having duly provided the required information to HMRC, carried out or agreed to carry out any transaction
(including under section 765 TA 88) which would be unlawful in the absence of such consent and has, where relevant, complied with the requirements of section 765 A(2) TA 88 (supply of information on movement of capital within the EU) and any
regulations made or notice given by that section. 

  

	33.	Non-Arm’s Length Transactions 

  

	33.1	The Company has not in the period of six years ending on the date of this Agreement been party to any non-arms length transaction or been party to any transaction or arrangement to
which the provisions of section 770A and Schedule 28AA TA 88 may apply. So far as the Seller is aware, the Company will not receive any payment for an asset or any services or facilities of any kind that it has supplied or provided or is liable to
supply or provide which is less than the market value of that asset or those services or facilities. 

  

	33.2	So far as the Sellers are aware, the Company has not at any time within the last six years transferred any asset for less than market value in circumstances where the provisions of
section 17 TCGA apply to that transfer. 

  

	34.	Groups of Companies 

  

	34.1	The Company has not in the past six years been a 51 per cent subsidiary of any person within the meaning of section 838 TA 88 (subsidiaries) other than a 51 per cent
subsidiary of AID Inc. or the Seller. 

  

	34.2	The Company has not at any time during the last six years acquired any asset from any company which at the time of the acquisition was a member of the same group of companies as
defined in section 170 TCGA; 

  

	34.3	The Company has not since the Balance Sheet Date ceased to be a member of a group of companies in such circumstances that a profit or gain was deemed to accrue to it under section
178 or 179 TCGA; 

  

	34.4	In the six years prior to Completion, there has been no reallocation of Tax to the Company from the Seller or a member of the Seller group of companies pursuant to Sections 171A,
175, 179A or 179B of TCGA or paragraph 66 of Schedule 29 FA 2002 and no amount in consideration of a similar reallocation is owed by a Company to any other person (other than another Company). 

  

	35.	Stamp Duties 

  

	35.1	There is no instrument to which the Company is a party and which is necessary to establish the Company’s rights or the Company’s title to any asset, which is liable to
stamp duty and which has not been duly stamped, or which would attract stamp duty, interest or penalties if brought into the United Kingdom. 

  

	35.2	Within the 3 years ending on the date of this Agreement, the Company has not made any claim for relief, exemption or deferral of stamp duty, stamp duty land tax or stamp duty
reserve tax. 

  

	35.3	The Company is not nor may become liable to pay stamp duty land tax after Completion by reference to any land transaction, as defined in section 43 FA 2003, to which it has been a
party prior to Completion. 

  

	36.	Group Payment Arrangements 

  

	36.1	The Company has not entered into any group payment arrangements under the provisions of section 36 FA 1998. 

  

 71 

 Schedule 7 
 Limitation of Seller’s liability 
 Subject as provided in clause 7, the following provisions shall apply:

  

	1.	General limitations 

  

	1.1	The Seller shall not be liable: 

  

	 	1.1.1	under the Warranties to the extent that the facts which might result in a claim or possible claim under the Warranties were Disclosed; 

  

	 	1.1.2	under the Indemnities or the Warranties or the Tax Deed to the extent that the subject of the claim is specifically provided for in the Working Capital Statement or the Completion
Tax Statement; 

  

	 	1.1.3	under this Agreement to the extent that the claim (other than in relation to the Tax Warranties) arises or is increased: 

  

	 	(a)	as a result of an act or omission on the part of the Seller occurring at the written request of the Purchaser after Completion; 

  

	 	(b)	as a result of an act or omission of or at the direction of the relevant Company or the Purchaser after Completion (otherwise than in the ordinary course of trading or under a
legally binding obligation of the relevant Company created before Completion or in order to ensure compliance with the law); 

  

	 	(c)	wholly or partly as a result of (i) the passing or coming into force of or any change in any enactment, law, regulation, directive, requirement or any published practice having
legal effect of any government, government department or agency or regulatory body (including extra-statutory concessions of HM Revenue and Customs) after Completion, whether or not having retrospective effect or (ii) except as set out in
clause 16.1, any change in the basis or method of calculation of, or of increase in the rates of, Taxation made or imposed by legislation after Completion with effect to any period ending before Completion; 

  

	 	1.1.4	under this Agreement to the extent that the Purchaser has recovered any amount under the Tax Deed or otherwise under this Agreement in respect of the same loss, damage or
deficiency; 

  

	 	1.1.5	the Seller shall not be liable in respect of any claim under the Warranties (other than the Tax Warranties) or under the Indemnity in clause 6.5(a) to the extent that the claim
arises or is increased as a result of any change after Completion in the accounting bases, policies, practice or methods applied in preparing any accounts or valuing assets or liabilities of any Company from those used in preparing the Accounts
unless such change was required in order to ensure compliance with the law or with UK GAAP. 

  

	2.	Quantum 

  

	2.1	The liability of the Seller in respect of any claim under the Warranties or the Indemnity in clause 6.5(i) shall not arise unless and until the amount of such claim when aggregated
with the amount of any other claim made against the Seller under the Warranties or such Indemnity exceeds £400,000 in which event all of such claim or claims (and not just the excess) shall be recoverable and no minimum shall apply to any
subsequent claims (but for the avoidance of 

  

 72 

 doubt this paragraph shall not prevent a claim from being validly notified pursuant to paragraph 3.1).

  

	2.2	The liability of the Seller in respect of any claim under the Warranties (excluding the Tax Warranties and the Warranties in paragraphs 2.7 (Solvency), 6.1 (Loans and Debts) and 8
(Environment) of Schedule 6) shall not (when aggregated with the amount of all other such claims) exceed 30% of the Consideration. 

  

	2.3	Without prejudice to paragraph 2.2 above, the liability of the Seller in respect of any claim under this Agreement, the Tax Warranties or under the Tax Deed shall not (when
aggregated with the amount of all other claims under this Agreement and under the Tax Deed) exceed the amount of the Consideration. 

  

	3.	Time limits 

  

	3.1	The liability of the Seller in respect of any claim under the Warranties or under the Tax Deed shall cease: 

  

	 	3.1.1	in the case of any claim the subject matter of which relates to Taxation, at the close of business on the seventh anniversary of Completion; 

  

	 	3.1.2	in the case of any claim under paragraph 8 (Environment) of Schedule 6, at the close of business on the fifth anniversary of Completion; and 

  

	 	3.1.3	in the case of any other claim, at the close of business on the day which falls 18 months after Completion. 

 except in respect of matters which before that period expires have been the subject of a bona fide written claim made by or on behalf of the Purchaser to
the Seller. 
  

	3.2	The Purchaser shall provide to the Seller reasonable details of the factual matters giving rise to the claim including, where possible, the Purchaser’s best estimate of the
amount of the claim. 

  

	3.3	Any such claim shall (if it has not previously been satisfied, settled or withdrawn) be deemed to have been withdrawn unless: 

  

	 	(a)	legal proceedings in respect of it have been commenced by both being issued and served within 9 months of such notification to the Seller; or 

  

	 	(b)	the Seller and the Purchaser have agreed in writing to extend the 9 month period, in which case this paragraph 3.3 shall apply to that claim with the substitution of that extended
period. 

  

	4.	Conduct of Claims 

  

	4.1	As soon as reasonably practicable after the Purchaser becomes aware of any claim made or threatened which does or may result in a claim under the Warranties (other than the Tax
Warranties) or the Indemnity in clause 6.5(i), the Purchaser will notify the Seller of that matter (a “Relevant Matter”) (indicating the nature of the allegations made). If the Seller is notified of a Relevant Matter made or
threatened to be made against the Purchaser or a Company (each an “Indemnified Party”), the Seller shall provide the Indemnified Party with such information and assistance in relation to the matter giving rise such Relevant
Matter as it may reasonably require provided that the Indemnified Party shall and shall procure that its Affiliates and professional advisers shall keep confidential all information so provided. If the Seller is restricted from providing such
information due to confidentiality obligations with a third party, the Seller shall use all reasonable endeavours to procure the release of such obligation for the purposes of providing the Purchaser or a Company with the required information.

  

 73 

	4.2	Subject to the Purchaser and the relevant Company being indemnified and secured to the Purchaser’s reasonable satisfaction, the Purchaser shall or shall procure that the
Company shall: 

  

	 	4.2.1	at reasonable intervals keep the Seller informed of the progress of the Relevant Matter and where the Seller reasonably considers its involvement might lead to a more beneficial
settlement of the Relevant Matter for the Purchaser and the Company, involve the Seller in discussions, strategy meetings and contact with the party bringing or threatening the Relevant Matter (without cost to either the Purchaser or the Company);

  

	 	4.2.2	(at the cost of the Seller) provide the Seller with copies of such documentation relating to the Relevant Matter as the Seller may reasonably request; and 

 

	 	4.2.3	maintain reasonable consultation with the Seller regarding the Relevant Matter and take its views, insofar as they are reasonable, into account. 

  

	4.3	Subject to paragraph 4.4, in relation to a claim made or threatened against the Purchaser or a Company that will or may give rise to liability under any Indemnity, or any other such
claim in respect of which the Seller undertakes to indemnify and hold harmless the Purchaser as if such claim was the subject of an Indemnity (each a “Third Party Claim”), the Purchaser shall, subject to the Purchaser and the
relevant Company being indemnified and secured to the Purchaser’s reasonable satisfaction, and subject to paragraph 4.3.3 below: 

  

	 	4.3.1	take such action as the Seller may reasonably request to: 

  

	 	(a)	avoid, dispute or defend; or 

  

	 	(b)	appeal or compromise, 

  

	 	the	Third Party Claim; 

  

	 	4.3.2	permit the Seller reasonable access at reasonable times to the employees and premises of the Purchaser to ask reasonable questions provided that the Seller shall, and shall procure
that its professional advisers shall, keep confidential all matters so examined, and provided that the Purchaser may require the Seller to pay a reasonable fee for the time of the employees of the Purchaser spent in connection with such examination;

  

	 	4.3.3	For the purpose of this clause 4.3: 

  

	 	(i)	the appointment of solicitors or other professional advisers shall be subject to the approval of the Purchaser such approval not to be withheld or delayed unreasonably;

  

	 	(ii)	the Purchaser shall be kept fully informed of all relevant matters and shall be entitled to see copies of all correspondence relating to any such action, negotiations or
proceedings; and 

  

	 	(iii)	the Seller shall not make any settlement of or compromise the Third Party Claim nor agree any matter in the conduct of any such action, negotiations or proceedings which is likely
to affect the amount of the claim or the future liability of the Purchaser without the prior written approval of the Purchaser, such approval not to be withheld or delayed unreasonably. 

  

	4.4	The provisions of paragraph 4.3 shall apply to any claim made or threatened against the Purchaser or a Company that will or may give rise to liability under the Indemnity in clause
6.5(i) (a “L/B Claim”), in lieu of the provisions of paragraph 4.2, if the Seller reasonably considers that such L/B Claim will give rise to a liability on the part of the Seller 

  

 74 

 notwithstanding paragraph 2.1 above, provided that in exercising its conduct rights under paragraph 4.3
the Seller shall use reasonable endeavours to mitigate the relevant Company’s liability in respect of such L/B Claim. 
  

	4.5	Pending the Seller acquiring rights of conduct in respect of a L/B Claim pursuant to paragraph 4.4, the Purchaser shall (and shall procure that the relevant Company shall) use
reasonable endeavours to mitigate such Company’s liability in respect of such L/B Claim. 

  

	5.	Recovery from Third Parties 

  

	5.1	Where the Purchaser and/or the relevant Company is or is likely to be entitled to recover from some other person (including any insurer) any sum in respect of any matter giving rise
to a claim for breach of the Warranties (other than the Tax Warranties), or under any Indemnity, then the Purchaser shall at the request of the Seller and subject to the Seller giving to the Purchaser security in terms satisfactory to the Purchaser
(acting reasonably) on an indemnity basis in respect of its costs and expenses, taxes, which may be incurred (including, in relation to a claim under against any insurer, any increase in premium on a renewal of the relevant insurance policy) procure
that reasonable steps are taken to enforce such recovery and if any sum is so recovered then either the amount payable by the Seller in respect of the claim shall be reduced by an amount equal to the sum so recovered (less the reasonable costs and
expenses of recovering it and any taxation payable by the Purchaser or the Company as a result of its receipt) or (if an amount shall already have been paid by the Seller in respect of that claim) there shall be repaid to the Seller an amount equal
to the amount so recovered (less the reasonable costs and expenses of its recovery and any taxation payable by the Purchaser or the Company as a result of its receipt) or (if less) the amount of the Seller’s payment PROVIDED ALWAYS the
Purchaser shall not be obliged to take such steps to recover if to do so would (in the reasonable opinion of the Purchaser) cause material damage to the goodwill or business of the relevant Company nor shall the Purchaser’s obligations under
this paragraph restrict or delay in any way the Purchaser’s right to bring a claim against the Seller. 

  

 75 

 Schedule 8 
 Working Capital Adjustment 
  

	1.	Preparation of Working Capital Statement 

  

	1.1	As soon as reasonably practicable after Completion, the Purchaser shall prepare a draft Working Capital Statement for the Companies in the form set out in Schedule 10.

  

	1.2	The Seller shall procure that the Purchaser has access (without charge), through its employees, agents and advisers, to all relevant files and/or working papers (with the right to
take copies at the Purchaser’s expense) in their possession or control (but not in the possession of any Company), to the extent that they are reasonably required in connection with the preparation of the Working Capital Statement and subject
to the Purchaser providing the Seller’s advisers with such undertaking as are reasonably requested. 

  

	1.2	The draft Working Capital Statement shall be prepared as at the opening of business on the date of Completion in accordance with the principles set out in this Schedule.

  

	1.3	The Purchaser shall procure that the draft Working Capital Statement is submitted to the Seller for review by the Seller within 60 Business Days after Completion. The Purchaser
shall procure that each Company gives the Seller (and its respective employees, agents and advisers) without charge access to all relevant files and/or working papers (with the right to take copies at the Seller’s expense) in such
Company’s possession or control to the extent they are reasonably required for the purposes of the Seller’s review of the draft Working Capital Statement and subject to the Seller providing the Purchaser’s advisers with such
undertakings as are reasonably requested. 

  

	1.4	The Parties shall pay their own respective costs in connection with the preparation of the Working Capital Statement. 

  

	1.5	The draft Working Capital Statement shall be deemed to have been accepted as the Working Capital Statement and no dispute may be raised in relation to it unless, within 30 Business
Days of it being received by the Seller, the Seller delivers to the Purchaser notice to the contrary specifying (i) the item or items disputed; (ii) the Seller’s reasons; and (iii) how the draft Working Capital Statement and the
Provisional Consideration should be adjusted (the “Dispute Notice”). Only those item(s) and amount(s) listed in the Dispute Notice shall be treated as being in dispute. If the Purchaser and the Seller resolve the item(s)
raised in the Dispute Notice in the 15 Business Days following receipt of the Dispute Notice, the draft Working Capital Statement (adjusted, if necessary, as agreed by the Purchaser and the Seller) will be deemed to have been accepted by the Parties
as the Working Capital Statement. 

  

	1.6	If the Seller and the Purchaser are unable to reach agreement within 15 Business Days of the Dispute Notice, the item(s) and amount(s) in dispute may, at the written election of the
Seller or the Purchaser, be referred to the decision of PricewaterhouseCoopers or, if they are unwilling or unable to act, an independent chartered accountant (the “Independent Accountant”) to be appointed (in default of
nomination by agreement between the Seller and the Purchaser) by the President for the time being of the Institute of Chartered Accountants in England and Wales on the written application of the Seller or of the Purchaser (whichever applies first).

  

	1.7	 The Independent Accountant shall act as an expert and not as an arbitrator and neither the Arbitration Act 1996 nor any earlier or later enactments on arbitration
shall apply. The Independent Accountant shall be instructed to adjudicate only upon the matters in dispute, and in no event shall any determination made by the Independent Accountant award to the Purchaser an amount greater than that claimed by the
Purchaser, or award to the Seller an amount greater than that claimed by the Seller. The Independent Accountant’s decision shall (in the absence of manifest error) be final and binding on the Parties for all the purposes of this Agreement. The
draft Working Capital Statement, as adjusted (if necessary) to reflect the 

  

 76 

	 	 
Independent Accountant’s final and binding decision, will be deemed to have been accepted by the Parties as the Working Capital Statement.

  

	1.8	The costs of the Independent Accountant shall be apportioned between the Parties as the Independent Accountant shall decide but each Party shall be responsible for its own costs of
presenting its case to the Independent Accountant. 

 Basis for preparation of the Working Capital Statement 

PART A: Accounting policies, principles, practices, bases and methodologies 
 The Working Capital Statement for the Companies shall: 
  

	1.	be prepared strictly in accordance with the specific overriding accounting principles, practices and policies set out in Part B (Specific accounting principles, practices and
policies) of this Schedule; 

  

	2.	subject to paragraph 1 above, be prepared using the accounting principles, practices and policies of the Companies applied in accordance with bases and methodologies consistent with
the preparation of the US GAAP Accounts; and 

  

	3.	subject to paragraphs 1 and 2 above, be prepared under generally accepted accounting principles and financial reporting and accounting standards in the United States of America in
issue and applicable at the Completion Date. 

 PART B: Specific accounting principles, practices and policies 
 The Working Capital Statement shall be prepared: 
  

	 	1.	as if the date to which the Working Capital Statement is made up were the last day of a financial year; 

  

	 	2.	(except as expressly provided in this Agreement) so as to include no charge, provision, reserve or write-off in respect of any costs, liabilities or charges to be incurred after the
date to which the Working Capital Statement is made up as a consequence of the change of ownership of the Companies or closure of any business (or part thereof) which results from the change of ownership (provided that the valuation of a business,
and its assets, shall be conducted in the context of the relevant business at Completion without taking into account any change of ownership thereof or the Purchaser’s intentions with respect to the conduct of any business after Completion);

  

	 	3.	so as to take no account of the costs of the Seller or the Purchaser in relation to this Agreement (including, without limitation, the costs of the preparation, delivery, review and
resolution of the Working Capital Statement); 

  

	 	4.	(except as specified in Schedule 10) such that the rate of exchange for conversion between relevant currencies and sterling shall be as set out in clause 1.2.12 of this Agreement;

  

	 	5.	after the day which is the earlier of (i) the completion by the Seller of its financial reporting requirements or (ii) 14 November 2008, the Purchaser shall arrange
for a physical stock take to take place at the premises of each Company. The Seller, Graham Payne and Deloittes (the “Seller’s Accountants”) shall be permitted access to attend at the time the Purchaser determines for
the physical count at each premises and to perform such sample test counts as they may reasonably request. The following counting procedure shall apply: 

  

					
	 Andover
	  	–	  	Full physical inventory

  

 77 

					
	 Penge Motion
	  	–	  	Raw materials and sub assemblies – all items with a net book value after provisions in excess of £1,000
	 Penge Motion
	  	–	  	WIP and finished goods – all items
	 Penge Avionics
	  	–	  	Raw materials and sub assemblies – all items with a net book value after provisions in excess of £1,000
	 Penge Avionics
	  	–	  	WIP and finished goods – all items
	 Heathrow Avionics
	  	–	  	Raw materials and sub assemblies – all items with a net book value after provisions in excess of £1,000
	 Heathrow Avionics
	  	–	  	WIP and finished goods – all items
	 Traxsys
	  	–	  	Raw materials and sub assemblies – all items with a net book value after provisions in excess of £1,000
	 Traxsys
	  	–	  	WIP and finished goods – all items

 Items not counted according to this policy will be valued under existing accounting policies.

  

	 	6.	so as to include (on the same basis as in the calculation of the Estimated Working Capital) a provision in respect of accrued holiday pay for Graham Payne (and disregarding for this
purpose the Payne Compromise Agreement). 

  

 78 

 Schedule 9 
 List of documents in the agreed form 
  

	1.	Tax Deed 

  

	2.	Directors’ resignations (Schedule 5 paragraph 1 (Completion Obligations)) 

  

	3.	Powers of attorney (Schedule 5 paragraph 1 (Completion Obligations)) 

  

	4.	US GAAP Accounts (clause 1.1 (Definition of “US GAAP Accounts”)) 

  

	5.	Schedule of outstanding and unpaid cheques (clause 1.1 (Definition of “Cash”)) 

  

	6.	Deeds of Assignment 

  

	7.	Releases 

  

	8.	Traxsys Supply Agreement 

  

	9.	Resolution to change the name of AIDL 

  

	10.	s.l79 joint elections (Schedule 5 paragraph 1 (Completion Obligations)) 

  

	11.	Payne Compromise Agreement 

  

	12.	Estimated Working Capital 

  

	13.	Accounts 

  

	14.	Esterline Reorganisation Step Plan 

  

 79 

 Schedule 10 
 Form of Working Capital Statement 
 Actual Cash Balance 
 Accounts receivable 
 Inter Affiliate Receivables 
 Bad debt provision 
 Unbilled 
 Accounts receivable other 
 Net external 
 Inventory

 Raw materials 
 Work in progress 
 Finished goods 
 Less progress payments 
 Total 
 Prepaid expenses 
 Other current assets 
 Total current assets 
 Current Liabilities 
 Actual Borrowing Amount 
 Accounts payable 
 Inter Affiliate Payables 
 Accrued expenses 
 Accrued payroll related 
 Payroll 
 Total current liabilities 
 Net Working Capital 
 Plus Transitional Services: 

Life, PHI and BUPA for two months (or for such other period as services provided) 
 Salary and wages for Olivier Cuq for two months (or for such other period as services provided) 
 Salary and wages and benefits for Richard LaMantia
for two months (or for such other period as services provided) 
 Plus: 
 £98,700 being the Purchaser contribution to Retention Bonuses 
 Actual Working Capital 
 Notes: 
  

	•	 	 Capitalised expressions shall have the meanings given to them in this Agreement. 

  

	•	 	 For the avoidance of doubt, Ordinary Trading Items will be included and Tax liabilities, and any Incentive Bonus payments (including in respect of Graham Payne)
shall be excluded from the Working Capital Statement. 

  

	•	 	 The line items Inter Affiliate Receivables and Inter Affiliate Payables shall respectively include Inter-Company Receivables and Inter-Company Payables as defined
in this Agreement. 

  

	•	 	 Accrued amounts due in respect of Transitional Services to be added to working capital and included in final payment under clause 3 (such payment being deemed to be
made by Purchaser on behalf of the relevant Company). 

  

 80 

	•	 	 The amounts included for transitional services shall (where applicable) be converted into pounds sterling at the average exchange rate for the period during which
such Transitional Services were provided. 

  

 81 

 Schedule 11 
 Transitional Services 
 Services 
 Non UK Employee Services- payroll and benefits: 
 The Seller shall provide or procure (but as regards persons outside
the Retained Group, only so far as it is able) the provision of the following services to the relevant Company: 
  

	•	 	 Provision and management of salaried payroll and benefits in relation to Richard LaMantia (based in the USA) and Olivier Cuq (based in France) (together the
“Non-UK Employees”) (on the same basis as provided as at the date of this Agreement) for a period of up to 60 days after Completion 

 The Seller will maintain or procure the maintenance of all necessary personnel and payroll records and pay any associated payroll tax to the appropriate government agency or body. The Seller will process the recovery
of any overpayments made during the period up to and including the relevant Services Termination Date and will liaise with human resources at the relevant Company as required. 
 The Seller shall issue to the Company an invoice relating to payments to be administered by the Seller on the Company’s behalf in relation to PAYE, national insurance contributions and pensions contributions not
less than 5 Business Days before the date upon which the Seller is obliged to pass such payments on (the “Payroll Payment Date”). The invoices submitted by the Seller above shall be settled pursuant to clause 3.2 and Schedule
10 or, to the extent not included in Schedule 10, in cleared funds by the Company no less than 2 Business Days before the relevant Payroll Payment Date. 
 Graham Payne Consultancy Arrangement 
 The Seller shall procure (so far as it is able) that Graham Payne provides consultancy services to
the Companies as follows: 
  

	(a)	Graham shall perform, on a non-exclusive basis, general management services for the Companies with a view to ensuring a smooth handover of the Business, including but not limited
to: (i) provision of services relating to the day to day management of the Business performed in a manner consistent with his performance and responsibilities during the 6 month period prior to Completion; and (ii) support in connection
with the transitioning of responsibilities to the manager appointed by the Purchaser; and (iii) introduction of the appointed manager to key customers and suppliers; and (iv) ensuring continued services (IT and HR) from the Retained Group
in accordance with this Schedule until the services are transitioned to the Companies (“Consultancy Services”); 

  

	(b)	During the period of the Consultancy Services, Graham shall report directly to Richard Madamba; 

  

	(c)	Graham shall be required to perform the Consultancy Services for a period of 40 days from Completion (the “Consultancy End Date”) as follows:

  

	 	(i)	Graham will provide the Consultancy Services on a full time basis for a period of 15 Business Days post Completion (“Initial Period”); 

  

	 	(ii)	for the period from the end of the Initial Period until the Consultancy End Date (“Second Period”), Graham shall provide such reasonable assistance to the Companies as
requested by the Companies or the Purchaser. Provided that this assistance shall be by telephone or email, and Graham shall not be required to attend 

  

 82 

	 	  	the Properties in person other than by prior agreement between Graham and the Purchaser; 

 The Purchaser shall procure that Graham is reimbursed promptly for all reasonable out of pocket expenses properly incurred in providing the Consultancy Services. 
 Employee Services – UK Life/Medical Insurance: 
 Provision and
continuation of life, medical and income protection insurance under the existing policies for all UK employees of the Companies until the termination date of the relevant existing policy. 
 Employee Services – Peoplesoft System: 
 Full access by
the relevant Company (to already trained HR personnel) to the HRIS system “Peoplesoft” licensed by the Retained Group for a period of 60 days after Completion in relation to the employees of the Companies including access to review data
and download files and data in relation to such employees. 
 Website Services: 
 Hosting and management by the Seller (on the same basis as hosted as at the date of this Agreement (including as to service levels)) for a period of up to 180 days after Completion of the following two websites
pending establishment of alternative hosting arrangements: 
 muirheadaerospace.com 
 traxsys.com 
 This shall include, but shall not
be limited to: 
  

	•	 	 removal of all branding in relation to and references to the Retained Group as requested by the Purchaser and inclusion on the website of the Ametek name and logo
and other Ametek corporate branding requirements as provided by the Purchaser; and 

  

	•	 	 inclusion of links to Ametek group or other websites as may reasonably be required by the Purchaser. 

 The Purchaser shall procure that the relevant members of its group establish alternative hosting arrangements for the websites as soon as reasonably practicable after
Completion. 
 Email Security Services – Postini (Google Message Security) System: 
 Full use and access, for a period of up to 30 days after Completion, to the Postini (now Google) software currently used by AIDL and Muirhead. 
  

 83 

					
	 Signed by Robert W. Cremin
	 	 )
	  	
	 for and on behalf of
	 	 )
	  	
	 ESTERLINE TECHNOLOGIES LIMITED
	 	 )
	  	 /s/    Robert W. Cremin
 Duly authorised

  

					
	 Signed by Robert W. Cremin 
	 	 )
	  	
	 for and on behalf of
	 	 )
	  	
	 ESTERLINE TECHNOLOGIES CORPORATION
	 	 )
	  	 /s/    Robert W. Cremin
 Duly authorised

  

					
	 Signed by John J. Molinelli
	 	 )
	  	
	 for and on behalf of
	 	 )
	  	/S/    John J. Molinelli
	 EMA HOLDINGS UK LIMITED
	 	 )
	  	  
 Duly authorised

  

					
	 Signed by William D. Eginton
	 	 )
	  	
	 for and on behalf of
	 	 )
	  	/S/    William D. Eginton
	 AMETEK, INC
	 	 )
	  	  
 Duly authorised

  

 84Stock Purchase Agreement between NMC Group, Inc. and Esterline Technologies

 Exhibit 10.34 
 EXECUTION COPY 
 STOCK PURCHASE AGREEMENT 
 This Stock Purchase Agreement (this “Agreement”) is entered into as of November 17, 2008 by and among each of the
individuals set forth on Annex I (each, a “Seller” and, collectively, the “Sellers”), NMC Group, Inc., a California corporation (the “Company”), and Esterline Technologies Corporation, a Delaware
corporation (the “Buyer”). 
 Introduction 
 The Sellers own all of the issued and outstanding shares of capital stock of the Company (the “Purchased Shares”). The Sellers wish to sell, and the Buyer wishes to buy, all of
the Purchased Shares on the terms and conditions set forth herein. 
 An index of defined terms as used in this Agreement is
set forth in Article 10. 
 NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties hereto agree as follows: 
 ARTICLE 1 
 PURCHASE AND SALE; CLOSING 
 1.1        Purchase and Sale.  Subject to the terms and conditions hereof, at the Closing, the Sellers shall sell, transfer, assign and deliver to the Buyer, and the Buyer shall
purchase from the Sellers, all of the Purchased Shares. 
 1.2        Purchase Price; Payments at Closing. 
 (a)        As used herein, the following terms shall have the following meanings: 
 “Closing Cash” means, as of immediately prior to the Closing, all the cash, marketable securities and other cash equivalents, and deposits of the Company (other than customer advances), wherever
located. 
 “Closing Indebtedness” means any liability for (i) indebtedness for
borrowed money, including interest thereon and prepayment or other penalties becoming due as a result of this transaction, created, issued or incurred by the Company, including the Debt Amount, (ii) all payment obligations of the Company for
the deferred purchase price for purchases of property outside the ordinary course of business arising in connection with transactions occurring prior to the Closing which are not evidenced by trade payables, (iii) the present value of all
payment obligations of the Company under leases in existence immediately prior to the Closing to which the Company is a party which are capital leases as of the Closing as determined in accordance GAAP, (iv) any payment obligations in respect
of letters of credit, interest rate swaps, collars, caps, hedging obligations or other similar contingent obligations, (v) any indebtedness of the type referred to in clauses (i) through (iv) above of any Person other than the Company
in 

 existence immediately prior to the Closing which is either guaranteed by, or secured by a
security interest upon any property owned by, the Company. 
 “Closing Purchase Price”
means $89,500,000 (i) plus the aggregate amount of the Closing Cash, (ii) minus an amount equal to the Closing Indebtedness, and (iii) plus the amount, if any, by which the Closing Working Capital exceeds the
Target Working Capital Ceiling, or minus the amount, if any, by which the Closing Working Capital is less than the Target Working Capital Floor. 
 “Closing Working Capital” means (i) the accounts receivable, inventory, prepaid expenses and other current assets (excluding deferred Tax assets, cash, marketable securities
and cash equivalents, other than customer advances and similar prepaid amounts which will be retained in the Company) of the Company as of immediately prior to the Closing (net of all applicable reserves), minus (ii) the accounts payable,
accrued expenses, accrued compensation, accrued Taxes and all other current liabilities of the Company as of immediately prior to the Closing, excluding for this purpose the items set forth on Schedule 1.2(a)(i) hereto, the Debt Amount, Sale
Bonuses and Sellers’ Expenses paid pursuant to Section 1.2(c). The Closing Working Capital shall be determined by reference to the accounts that were used to determine the Target Working Capital, which was determined in accordance with
United States generally accepted accounting principles (“GAAP”) as set forth on Schedule 1.2(a)(ii) hereto. 
 “Credit Facility” means that certain Loan Agreement by and among the Company and Community Bank, dated May 15, 2006, as amended and supplemented, which established a revolving credit line for the
identified Borrowers from the identified Lenders. 
 “Debt Amount” means all outstanding
principal, accrued interest, fees, expenses and other amounts owed by the Company immediately prior to the Closing in connection with the Credit Facility. 
 “Escrow Account” means the account established by the Escrow Agent to hold the Escrow Amount and any earnings thereon pursuant to the Escrow Agreement. 
 “Escrow Agent” means Wells Fargo, N.A. 
 “Escrow Agreement” means the Escrow Agreement, substantially in the form of Exhibit A attached
hereto, to be entered into among the Buyer, the Representative and the Escrow Agent at the Closing. 
 “Escrow Amount” means the amount in the Escrow Account at the time of determination. 
 “Estimated Closing Purchase Price” means the Closing Purchase Price, determined using the estimate of the Closing Working Capital, the Closing Cash and the Closing Indebtedness set forth in the Estimated Closing Purchase
Price Certificate. 
  

 -2- 

 “Retained Employee” means each of Mark Balderrama,
Thomas Mendez and Stephen Williams. 
 “Retention Amount” means the following amounts for
each of the following Retained Employees: 
 Mark Balderrama – $87,000 
 Thomas Mendez – $180,620 
 Stephen Williams – $36,000 
 “Retention Bonuses”
means the amount to be paid pursuant to Section 5.14. 
 “Sale Bonuses” means the
Retention Bonuses and all change of control, sale, and transaction bonuses, if any, payable to the employees of the Company in connection with or as a result of the transactions contemplated by this Agreement. 
 “Sellers’ Expenses” means the fees and expenses incurred by the Sellers and/or the Company in
connection with the transactions contemplated by this Agreement including, without limitation, the fees and expenses of Houlihan Lokey Howard & Zukin Capital, Inc. and Paul, Hastings, Janofsky & Walker LLP, but specifically
excluding any fees and expenses incurred by or for the benefit of the Buyer or any of its Affiliates. 
 “Target Working Capital” means $5,600,000. 
 “Target Working Capital
Ceiling” means Target Working Capital plus $50,000. 
 “Target Working Capital Floor”
means Target Working Capital minus $50,000. 
 (b)        Except where
the context clearly requires to the contrary: (i) each reference in this Agreement to a designated “Section,” “Article,” “Schedule,” “Exhibit,” or “Annex” is to the corresponding Section,
Article, Schedule, Exhibit or Annex of or to this Agreement; (ii) instances of gender or entity-specific usage (e.g., “his” “her” “its” “person” or “individual”) shall not be
interpreted to preclude the application of any provision of this Agreement to any individual or entity; (iii) the word “or” shall not be applied in its exclusive sense; (iv) “including” shall mean “including,
without limitation”; (v) references to laws, regulations and other governmental rules, as well as to contracts, agreements and other instruments, shall mean such rules and instruments as in effect as of the date of this Agreement;
(vi) references to “$” or “dollars” shall mean the lawful currency of the United States; (vii) references to “Federal” or “federal” shall be to laws, agencies or other attributes of the United
States (and not to any State or locality thereof); (viii) the meaning of the terms “domestic” and “foreign” shall be determined by reference to the United States; (ix) references to “days” shall mean calendar
days; references to “business days” shall mean any day other than Saturday, Sunday or any day on which commercial banks in Los Angeles, California are 
  

 -3- 

 authorized to close; (x) references to months or years shall be to the actual calendar months or
years at issue (taking into account the actual number of days in any such month or year); (xi) days, business days and times of day shall be determined by reference to local time in Los Angeles, California; and (xii) the English language
version of this Agreement shall govern all questions of interpretation relating to this Agreement, notwithstanding that this Agreement may have been translated into, and executed in, other languages. 
 (c)        At least two business days prior to the Closing, the Representative will
furnish to the Buyer (i) a certificate (the “Estimated Closing Purchase Price Certificate”) setting forth an estimate of the Closing Working Capital, the Closing Cash and the Closing Indebtedness and a calculation of the
Closing Purchase Price based thereon, and (ii) a payoff letter from each holder of such outstanding Closing Indebtedness (A) indicating the amount required to discharge such Closing Indebtedness at Closing and (B) if such Closing
Indebtedness is secured by any liens, security interests, mortgages, restrictions or encumbrances (collectively, “Liens”), agreeing to release such Liens upon receipt of the payoff amount. The Estimated Closing Purchase Price
Certificate shall be reasonably acceptable to the Buyer, and the Representative and the Buyer shall cooperate in good faith to resolve any disputes raised by the Buyer with respect to items set forth in the Estimated Closing Purchase Price
Certificate and consider whether any modifications thereto are applicable prior to the Closing; provided that (i) if the Representative and the Buyer are unable to agree on the Estimated Closing Purchase Price Certificate notwithstanding such
good faith efforts to resolve any such disputes prior to the Closing, then the estimate of the Closing Working Capital, the Closing Cash and the Closing Indebtedness reflected on the Estimated Closing Purchase Price Certificate, with any
modifications agreed to by the Representative and the Buyer, shall be used in the calculation of the Estimated Closing Purchase Price payable pursuant to Section 1.2(d) and (ii) no actions taken by the Buyer pursuant to this
Section 1.2(c) shall operate as a waiver of or otherwise affect or impair the Buyer’s ability to take any actions or assert any disagreement or other rights pursuant to Section 1.7. 
 (d)        At the Closing, the Buyer shall make the following payments in an amount, in
the aggregate, equal to the Estimated Closing Purchase Price, by wire transfer of immediately available funds: 
 (i)        first, to the respective holders of the Closing Indebtedness, if any, the amounts specified in the payoff letters delivered by the Representative to the Buyer pursuant to
Section 1.2(c)(ii) above; 
 (ii)        second, to such
payees of the Sellers’ Expenses as directed in writing by the Representative prior to the Closing; 
 (iii)        third, to an account established by the Company (the “Payment Account”), an amount equal to the aggregate amount of Sale Bonuses (and following the Closing, the
Company shall pay the Retention Bonuses in accordance with Section 5.14); 
 (iv)        fourth, to the Escrow Agent pursuant to the Escrow Agreement, an amount equal to $8,500,000 (the “Initial Escrow Amount”) to be held in the Escrow Account and
disbursed in accordance with the terms of the Escrow Agreement; and 
  

 -4- 

 (v)        fifth, the
remainder to or as directed by the Representative. 
 1.3        Cash
Withdrawal.  Subject to the terms and conditions of this Agreement, including Section 5.2 hereof, between the date hereof, through and including the Closing Date, the Company shall have the right to distribute any portion of its
cash and cash equivalents from time to time to the Sellers, other than such cash representing customer advance payments and other similar prepaid amounts which will be retained in Company accounts. 
 1.4        The Closing.  The consummation of the transactions contemplated
hereby (the “Closing”) will take place at the offices of Paul, Hastings, Janofsky & Walker LLP, on (a) the day that is two (2) business days after the conditions set forth in Article 6 are satisfied
(other than those conditions which by their nature are normally satisfied at the Closing) or waived, or (b) such later date that is agreed to in writing by the Sellers and the Buyer (the “Closing Date”). 
 1.5        Deliveries at Closing by the Sellers and the Company.  At the
Closing, and upon satisfaction or waiver of the conditions set forth in Section 6.2, the Sellers and the Company will deliver or cause to be delivered the instruments, consents, certificates and other documents required of them by
Section 6.1. 
 1.6        Deliveries at Closing by the
Buyer.  At the Closing, and upon satisfaction or waiver of the conditions set forth in Section 6.1, the Buyer will deliver or cause to be delivered the instruments, consents, certificates and other documents required of it by
Section 6.2. 
 1.7        Determination of Closing Purchase Price.

 (a)        Within 120 days after the Closing Date, the Buyer will
deliver to the Representative a certificate (the “Closing Purchase Price Certificate”) executed by the Buyer setting forth an itemized statement of the Closing Working Capital, the Closing Cash and the Closing Indebtedness and a
calculation of the Closing Purchase Price. 
 (b)        If the
Representative delivers written notice (the “Disputed Items Notice”) to the Buyer within thirty (30) days after receipt by the Representative of the Closing Purchase Price Certificate, stating that the Representative
objects to any items in the Closing Purchase Price Certificate, specifying in reasonable detail the basis for such objection and setting forth the Representative’s proposed modification to the Closing Purchase Price, the Buyer and the
Representative shall use their commercially reasonable efforts to resolve and finally determine and agree upon the Closing Purchase Price as promptly as practicable. The Disputed Items Notice shall specify those items or amounts as to which the
Representative disagrees, and the Representative shall be deemed to have agreed with (and the Independent Accountant, if any, shall be deemed to be bound by) all other items and amounts contained in the Closing Purchase Price Certificate delivered
pursuant to Section 1.7(a). 
 (c)        If the Representative and the
Buyer are unable to agree upon the Closing Purchase Price within thirty (30) days after delivery of the Disputed Items Notice, the Representative and the Buyer will select an accounting firm of nationally recognized standing, which shall
in all cases be independent from the parties hereto (the “Independent Accountant”), to resolve the items set forth in the Disputed Items Notice (the “Disputed Items”). If the Buyer 
  

 -5- 

 and the Representative are unable to agree upon the selection of the Independent Accountant, either party
may petition a court to select the Independent Accountant. The Independent Accountant will (i) resolve the Disputed Items and (ii) make a determination of the Closing Purchase Price using the calculations set forth in the Closing Purchase
Price Certificate, as modified only by the Independent Accountant’s resolution of the Disputed Items. In making such calculation, the Independent Accountant shall consider only those items or amounts in the Closing Purchase Price Certificate
and the calculation of the Closing Working Capital, Closing Cash and the Closing Indebtedness as to which the Representative has disagreed in the Disputed Items Notice and the Independent Accountant’s determination with respect to each disputed
item shall not be in excess of, nor less than, the greatest or lowest value, respectively, claimed for that particular item in the Closing Purchase Price Certificate or in the Disputed Items Notice. The determination of the Independent Accountant
will be made within sixty (60) days after being selected. Such determination shall be final and binding upon the Buyer and the Sellers, shall be deemed a final arbitration award that is binding on the Buyer and the Sellers, and none of the
Buyer or the Sellers may seek further recourse to courts or other tribunals with respect thereto, other than to enforce such determination. The fees and expenses of the Independent Accountant shall be allocated to the Buyer, on the one hand, and the
Sellers, on the other, based upon the percentage that the portion of the contested amount not awarded to each party bears to the amount actually contested by such party, as determined by the Independent Accountant. 
 (d)        If the Representative does not deliver the Disputed Item Notice to the Buyer
within thirty (30) days after receipt by the Representative of the Closing Purchase Price Certificate, the Closing Purchase Price specified in the Closing Purchase Price Certificate will be conclusively presumed to be true and correct in
all respects and will be final and binding upon the parties. 
 (e)        At
such time as the Closing Purchase Price is finally determined, either (i) the Buyer shall pay the Representative (for payment to the Sellers) an aggregate amount equal to the excess, if any, of the Closing Purchase Price over the Estimated
Closing Purchase Price or (ii) the Representative shall instruct the Escrow Agent to pay the Buyer from the Escrow Account an aggregate amount equal to the excess, if any, of the Estimated Closing Purchase Price over the Closing Purchase Price.
Any payment pursuant to this Section 1.7(e) shall be made within five business days after the Closing Purchase Price has been determined by wire transfer by the Buyer or the Escrow Agent, as the case may be, of immediately available funds to
the account of such other party as may be designated in writing by such other party. Except as set forth in this Section 1.7, the Buyer shall have no right to make any claim against any Seller in respect of the determination of the Closing
Purchase Price or the Closing Working Capital and, without limiting the generality of the foregoing, no adjustment to the Closing Purchase Price pursuant to this Section 1.7 shall be considered a breach of any representation, warranty or other
provision of this Agreement. 
 (f)        The Sellers and their accountants,
lawyers and other representatives will be given full access at all reasonable times to (and shall be allowed to make copies of) the relevant books and records of the Company and to any personnel of the Company reasonably requested by such persons,
in each case in connection with the final determination of the Closing Purchase Price or any dispute relating thereto. 
  

 -6- 

 1.7.2        Withholding.  The Buyer shall be entitled to deduct and withhold from the Closing Purchase Price otherwise deliverable to the Sellers under this Agreement, and
from any other payments to the Sellers otherwise required pursuant to this Agreement, any amounts the Buyer is required to deduct and withhold with respect to any such deliveries and payments under the Internal Revenue Code of 1986, as amended (the
“Code”) or any provision of state, local, provincial or foreign Tax law. To the extent that amounts are so withheld, such withheld amounts shall be treated for all purposes of this Agreement as having been delivered and paid to the
Sellers in respect of which such deduction and withholding was made. 
 ARTICLE 2 
 REPRESENTATIONS AND WARRANTIES 
 CONCERNING THE SELLERS 
 Each Seller hereby, severally and not jointly, represents and warrants to the Buyer
that each of the statements contained in this Article 2, with respect to himself or herself, when read together with and qualified by the Disclosure Schedule delivered by the Sellers to the Buyer in connection with and prior to the execution of
this Agreement (the “Disclosure Schedule”) is true and correct as of the date hereof. 
 2.1        Title.  Except as set forth on Schedule 2.1 of the Disclosure Schedule, such Seller owns, and has good title to, the Purchased Shares set forth opposite his or
her name on Annex I attached hereto (the percentage of such Purchased Shares owned being his or her “Pro Rata Share”). At the Closing, such Seller will transfer his or her Purchased Shares to the Buyer free and clear of all Liens,
other than restrictions under applicable securities laws. Upon the consummation of the transactions contemplated by this Agreement, the Buyer will own such Purchased Shares, free and clear of all Liens, other than restrictions imposed under
applicable securities law. 
 2.2        Power and Authority.  Such
Seller has the requisite capacity to execute and deliver and to carry out the terms of this Agreement and the other agreements, instruments and documents to be executed and delivered by such Seller as contemplated hereby. 
 2.3        No-Conflict.  Except as set forth on Schedule 2.3 of the
Disclosure Schedule, such Seller’s execution, delivery and performance of this Agreement and the other agreements, instruments and documents to be executed and delivered by such Seller as contemplated hereby will not result in any material
violation of, be in material conflict with or constitute a material default under any law, statute, regulation, rule, ordinance, contract, agreement or instrument, judgment, decree or order to which such Seller is a party or by which such Seller or
his or her assets is bound. 
 2.4        Consents and
Approvals.  Except for any applicable filings under the HSR Act or as set forth on Schedule 2.4 of the Disclosure Schedule, no consent, order, approval, authorization, declaration or filing from or with any governmental
authority or third party is required on the part of such Seller to permit such Seller to fulfill all of such Seller’s obligations under this Agreement and the other agreements, instruments and documents of such Seller contemplated hereby.

  

 -7- 

 2.5        Validity and
Enforceability.  Assuming the valid execution and delivery by the other parties hereto and thereto, this Agreement is, and each of the other agreements, instruments and documents to be executed and delivered by such Seller as
contemplated hereby will be when executed and delivered by such Seller, the valid and binding obligations of such Seller, enforceable against such Seller in accordance with their respective terms, subject, however, to applicable bankruptcy,
insolvency and other laws affecting the rights and remedies of creditors and to general equitable principles. 
 ARTICLE 3 

REPRESENTATIONS AND WARRANTIES 
 CONCERNING THE COMPANY 
 The Company represents and warrants to the Buyer that each of the statements
contained in this Article 3 when read together with and qualified by the Disclosure Schedule is true and correct as of the date hereof. 
 3.1        Organization, Power and Standing.  The Company is a corporation duly organized, validly existing and in good standing under the laws of the State of
California. The Company has full corporate power and authority to own, lease and operate its properties and to carry on its business as such business is conducted on the date hereof. The copies of the articles of incorporation and by-laws of the
Company, each as amended through the date hereof (the “Company Charter Documents”), that have been made available to the Buyer by the Company are complete and correct copies thereof. 
 3.2        Power and Authority.  The Company has the corporate power and
authority and has taken all required corporate action on its part necessary to permit it to execute and deliver and to carry out the terms of this Agreement and the other agreements, instruments and documents to be executed and delivered by the
Company as contemplated hereby. 
 3.3        Validity and
Enforceability.  Assuming the valid execution and delivery by the other parties hereto and thereto, this Agreement is, and each of the other agreements, instruments and documents to be executed and delivered by the Company as
contemplated hereby will be when executed and delivered by the Company, the valid and binding obligations of the Company, enforceable against the Company in accordance with their respective terms, subject, however, to applicable bankruptcy,
insolvency and other laws affecting the rights and remedies of creditors and to general equitable principles. 
 3.4        Subsidiaries.  The Company has no subsidiaries and does not own or have the right to acquire any equity interest in any corporation, limited liability company, partnership,
joint venture, trust or other business organization. 
 3.5        Foreign
Qualifications.  Schedule 3.5 of the Disclosure Schedule sets forth a complete and accurate list of all jurisdictions in which the Company is qualified to do business as a foreign entity. There are no other
jurisdictions in which the Company is required to qualify to do business as a foreign entity, except for any jurisdiction(s) in which the failure to so qualify would not have a Company Material Adverse Effect. 
  

 -8- 

 As used herein, the term “Company Material Adverse Effect” shall mean
any event, circumstance, or condition which has had or reasonably could be expected to have, a material adverse effect on the assets, liabilities, properties, results of operations or financial condition of the Company, taken as a whole;
provided, however, that in no event shall any of the following be taken into account in the determination of whether a Company Material Adverse Effect has occurred: (a) any change in any Legal Requirement or GAAP; (b) any
change resulting from conditions affecting any of the industries in which the Company operates or from changes in general business, financial, political, capital market or economic conditions (including any change resulting from any hostilities, war
or military or terrorist attack), so long as the Company is not disproportionately affected thereby; (c) any change resulting from the announcement or pendency of the transactions contemplated by this Agreement or attributable to the fact that
the Buyer or any of its Affiliates are the prospective owners of the Company; (d) any event, condition or other matter described on the Disclosure Schedule that has not materially changed since the date of such disclosure; or (e) any
change resulting from the compliance by the Company with the terms of, or the taking of any action by the Company contemplated or permitted by, this Agreement. 
 3.6        Capitalization.  Schedule 3.6 of the Disclosure Schedule sets forth a complete and accurate list of all
outstanding shares of capital stock of the Company and the record holders thereof. Such shares are duly authorized, validly issued, fully paid and nonassessable. There are no outstanding options, warrants, convertible or exchangeable securities or
other rights that would obligate the Company to issue shares of its capital stock or other equity securities. Except as set forth on Schedule 3.6 of the Disclosure Schedule, there are no agreements, written or oral, to which the Company
is a party relating to the acquisition, disposition, voting or registration under applicable securities laws of any equity security of the Company. Except as set forth on Schedule 3.6 of the Disclosure Schedule, there are no outstanding
or authorized stock appreciation, phantom stock or other similar rights with respect to the Company. 
 3.7        Financial Statements.  (a) The Sellers have delivered to the Buyer (i) an audited balance sheet of the Company as of each of December 31, 2006
and 2007, and audited statements of income, stockholders’ equity and cash flows for the fiscal years then ended, and (ii) an unaudited balance sheet of the Company (the “Balance Sheet”) as of June 30, 2008 (the
“Balance Sheet Date”) and an unaudited statement of income for the six-month period then ended. Such financial statements and the notes thereto, if any, fairly present, in all material respects, the financial condition of the
Company for the periods then ended, and were prepared in accordance with the books and records of the Company in conformity with GAAP (except as set forth on Schedule 3.7(a) of the Disclosure Schedule or in the case of unaudited
financial statements for the omission of footnotes and subject to year-end adjustments). 
 (b)        Except as set forth on Schedule 3.7(b) of the Disclosure Schedule, each accrual reflected on the Balance Sheet is adequate to meet the liability underlying such accrual
and the reserve provided for doubtful accounts reflected on the Balance Sheet is adequate given the Company’s history and current knowledge of the account. 
 (c)        The Company has no liabilities, contingent or otherwise that are not reflected on the Balance Sheet, including the notes thereto, other
than liabilities arising in the 
  

 -9- 

 ordinary course of business, liabilities incurred in connection with the transactions contemplated hereby
and liabilities which are not material to the Company. Except as reflected on the Balance Sheet and Schedule 3.7(c)(i) of the Disclosure Schedule, the Company has no indebtedness for money borrowed or for the deferred purchase price of
property or services, capital lease obligations, conditional sale or other title retention agreements relating to the Company’s assets or business. Except as set forth in Schedule 3.7(c)(ii) of the Disclosure Schedule, the Company
is not a guarantor or otherwise liable for any liability or obligation or any other person for any matter which relates to or affects the Company or its assets or business. 
 (d)        All accounts receivable of the Company reflected in the Balance Sheet or existing as of the Closing Date, are bona fide accounts
receivables and are or will be valid and enforceable against the account debtor, subject to the allowance for doubtful accounts set forth on the Balance Sheet or in the books and records of the Company, as the case may be. 
 (e)        All inventories of finished products consist of items of a quality and
quantity that are saleable in the ordinary course of business as currently conducted by the Company, and all inventories of raw materials, work in process, supplies, parts and packaging and labeling materials consist of items of a quality and
quantity that are useable in the ordinary course of business as currently conducted by the Company. To the knowledge of the Company, there is no adverse condition affecting the quality or supply of raw materials, intermediates, supplies, parts and
other materials available to the Company that are necessary to manufacture, package or label its products. 
 3.8        Absence of Certain Changes.  Since the Balance Sheet Date, except as set forth on Schedule 3.8 of the Disclosure Schedule and except for transactions
contemplated by this Agreement, (a) the Company has conducted its business in all material respects in the ordinary course, (b) no Lien has been placed upon any of the Company’s assets, other than Permitted Liens, (c) the Company
has not acquired or disposed of any material assets, except in the ordinary course of business, (d) there has been no material damage, destruction or casualty loss (other than those covered by insurance the proceeds of which will be used to
replace or repair the subject assets prior to Closing) with respect to any of the assets or properties of the Company, (e) the Company has not cancelled, compromised or waived any material right or claim, (f) the Company has not
accelerated, terminated, modified or cancelled any material agreement, contract, lease or license related to the Company’s business, and (g) to the Company’s knowledge, there has been no event or circumstance relating specifically to
the Company that has caused or could reasonably be expected to cause a Company Material Adverse Effect. 
 3.9        Taxes. 
 (a)        The representations and warranties set forth in this Section 3.9 are subject in all respects to the qualifications and disclosures set forth on Schedule 3.9 of the
Disclosure Schedule. 
  

 -10- 

 (b)        For purposes of this
Agreement, the following definitions shall apply: 
 (i)        “Pre-Closing Tax Period” means all taxable periods ending on or before the Closing Date and the portion of a Straddle Period ending on and including the Closing
Date. 
 (ii)        “Pre-Closing Taxes”
means any and all Taxes of the Company that are attributable to a Pre-Closing Tax Period, relate to an event or transaction occurring on or before the Closing Date, or arise out of or result from the transactions contemplated by this Agreement
(including any transfer, documentary, sales, use, stamp, registration and other such Taxes and fees, and any interest, fines, assessments, penalties or additions to tax imposed in connection therewith or with respect thereto). 
 (iii)        “Straddle Period” means a Tax period that
includes, but does not end on, the Closing Date 
 (iv)        “Tax” or “Taxes” means (a) any and all federal, state, provincial, local, foreign and other taxes, levies, fees, imposts, duties and similar
governmental charges (including any interest, fines, assessments, penalties or additions to tax imposed in connection therewith or with respect thereto), whether computed on a separate or consolidated, unitary or combined basis or in any other
manner, including, without limitation, (A) taxes imposed on, or measured by, income, franchise, profits or gross receipts, and (B) ad valorem, value added, capital gains, sales, goods and services, use, real or personal property, capital
stock, license, branch, payroll, estimated, withholding, employment, social security (or similar), unemployment, compensation, utility, severance, production, excise, stamp, occupation, premium, windfall profits, transfer and gains taxes, and
customs duties; (b) liability for the payment of any amounts of the type described in clause (a) arising as a result of being (or ceasing to be) a member of any affiliated, consolidated, unitary or similar group; or (c) liability for
the payment of any amounts of the type described in clause (a) or (b) as a result of any express or implied obligation to indemnify or otherwise assume or succeed to the liability of any other Person. 
 (v)        “Tax Returns” means all reports, estimates,
declarations of estimated Tax, information statements and returns relating to Taxes and any schedules attached to or amendments of any of the foregoing. 
 (c)        The Company has made a valid election, effective as of May 1, 1988 to be treated as an S corporation within the meaning of Sections 1361 and 1362 of the
Code and under any corresponding state or local tax provision. For federal and applicable state and local income Tax purposes, the Company has properly qualified as an S corporation since the effective date of its election through the date of this
Agreement, and will properly qualify as an S corporation through and until the Closing Date in all applicable jurisdictions in which it is subject to Tax. Since the effective date of its election, the Company has not been subject to income Tax as a
C corporation within the meaning of Section 1361(a) of the Code (or comparable provision of state or local law). 
  

 -11- 

 (d)        The Company will not be
obligated to pay Tax under Section 1374 of the Code (or comparable provision of state or local law) in connection with the transactions contemplated by this Agreement. The Company has not, in the past 10 years acquired assets from another
corporation in a transaction in which the Company’s Tax basis for the acquired assets was determined, in whole or in part, by reference to the Tax basis of the acquired assets (or any other property) in the hands of the transferor. 

(e)        The Company has made available to the Buyer true and correct copies of the
Tax Returns of the Company for the 2005, 2006 and 2007 taxable years. 
 (f)        Except as set forth on Schedule 3.9(f) of the Disclosure Schedule, the Company has duly and timely filed all Tax Returns that were required to be filed by it and all such
Tax Returns are true, correct and complete in all material respects. The Company has paid when due all Taxes required to be paid by it (whether or not shown or required to be shown to be due on any Tax Return). The Company does not have any
currently effective agreement or waiver that would have the effect of extending any applicable statute of limitations in respect of any of its Tax liabilities. No power of attorney has been granted by the Company with respect to any Tax matter which
is currently in force. There are no unpaid assessments against the Company of any Taxes for any fiscal period or pending or, to the knowledge of the Company, threatened tax examinations or audits by any foreign, federal, state or local taxing
authority. No governmental authority has given notice to the Company of any intention to assert any deficiency or claim for additional Taxes against the Company. All Taxes that the Company is required by law to withhold or to collect for payment
have been duly withheld and collected and, to the extent required, paid to the proper governmental entity. There are no Tax Liens pending or, to the knowledge of the Company, threatened against the Company or its assets or property, other than
Permitted Liens. 
 (g)        The Company is not now, nor has it previously
been, a member of an affiliated group filing a consolidated, combined, unitary or similar Tax Return. The Company has no liability for Taxes of any Person (other than itself) under Treasury Regulation Section 1.1502-6 (or any similar provision
of state, local or foreign law), as a transferee or successor, by contract, or otherwise. 
 (h)        No claim has ever been made by a taxing authority in a jurisdiction where the Company does not file Tax Returns that the Company is or may be subject to taxation by that
jurisdiction. 
 (i)        No withholding is required under
Section 1445 of the Code in connection with the consummation of the transactions contemplated by this Agreement. 
 (j)        The Company is not now, nor has it previously been, a party to a “reportable transaction” within the meaning of Section 1.6011-4(b) of the Treasury Regulations.

 (k)        The Company has not distributed stock of another Person nor has
had its stock distributed by another Person in a transaction that was purported or intended to be governed in whole or in part by Sections 354, 355 or 361 of the Code. 
  

 -12- 

 (l)        Each “nonqualified
deferred compensation plan” (as such term is defined in Section 409A(d)(1) of the Code) sponsored or maintained by the Company since January 1, 2005 has been operated since that date in good faith compliance with Section 409A of
the Code, the final or proposed regulations thereunder, and any other Internal Revenue Service guidance issued with respect thereto, to the extent applicable to such plan. No deferred compensation plan existing prior to January 1, 2005, which
would otherwise not be subject to Section 409A of the Code, has been “materially modified” at any time after October 3, 2004. 
 3.10        Personal Property.  The Company has valid title to or a valid leasehold, license or other similar interest in all tangible personal property, free
and clear of all Liens, except for Permitted Liens, used by the Company in its business, except for any tangible personal property disposed of in the ordinary course of the business after the date hereof. The equipment and other tangible operating
assets of the Company, taken as a whole, are in adequate condition to conduct the business of the Company as the same is conducted on the date hereof, normal wear and tear excepted. 
 As used herein, “Permitted Liens” means (a) such imperfections of title, easements, encumbrances, liens or
restrictions which (i) are of record and (ii) do not materially impair the current use of the Company’s assets, (b) materialmen’s, mechanics’, carriers’, workmen’s, warehousemen’s, repairmen’s,
landlords’, and other like Liens arising in the ordinary course of business, or deposits to obtain the release of such Liens for amounts which are not yet due and payable, (c) Liens for Taxes not yet due and payable, or being contested in
good faith, (d) purchase money Liens incurred in the ordinary course of business, (e) Liens created as a result of any action taken by or through the Buyer or any of its Affiliates, or (f) Liens securing the Debt Amount which will be
removed at the Closing assuming compliance by Buyer with its obligations hereunder. 
 3.11        Real Property. 
 (a)        The Company does not own any real property. 
 (b)        Schedule 3.11 of the Disclosure Schedule describes each interest in real property leased by the Company, including the lessor of such leased property, and identifies each
lease or any other arrangement under which such property is leased. The Company enjoys peaceful and quiet possession of its leased premises and has not received any written notice from any landlord asserting the existence of a default under any such
lease or been informed in writing that the lessor under any such lease has taken action or, to the knowledge of Company, threatened to terminate the lease before the expiration date specified in the lease. Except as set forth on
Schedule 3.11 of the Disclosure Schedule, each lease of real property is valid and binding against the Company and, to the knowledge of the Company, against the counterparty thereto, and is in full force and effect, and has not been
amended from the version provided to the Buyer. No security deposit or portion thereof deposited with respect to any real property lease has been applied with respect of a breach of default under such lease which has not been redeposited in full.
Except as set forth on Schedule 3.11 of the Disclosure Schedule, the Company has not subleased, licensed or otherwise granted to any person or entity the right to use or occupy any of the leased real property or any portion thereof.
Except as shown on 
  

 -13- 

 Schedule 3.11 of the Disclosure Schedule, the transactions contemplated by this Agreement
will not be the basis for any lessor to terminate its lease prior to the expiration date of the lease. 
 3.12        Intellectual Property. 
 (a)        As used herein “Intellectual Property” means all (i) patents, provisional patents, patent applications, continuations, continuations in part, extensions and
patent disclosures, (ii) trademarks and service marks (registered and unregistered), and registrations and applications for registration thereof together, to the extent applicable, with all of the goodwill associated therewith (iii) trade
dress, trade names and corporate names (iv) copyrights (registered or unregistered) and copyrightable works and registrations and applications for registration thereof, (v) computer software, data, data bases and documentation thereof,
(vi) trade secrets and other confidential information (including, without limitation, ideas, formulae, compositions, inventions (whether patentable or unpatentable and whether or not reduced to practice), know-how, manufacturing and production
processes and techniques, research and development information, drawings, specifications, designs, plans, proposals, technical data, financial and marketing plans and customer and supplier lists and information), and (vii) Uniform Resource
Locators (a.k.a. “URLs” or “domain names”). As used herein “Company Intellectual Property” means Intellectual Property owned by the Company. 
 (b)        Schedule 3.12(b) of the Disclosure Schedule contains a list of all
Company Intellectual Property included in clauses (i), (ii) and (vii) of the definition of Intellectual Property, and all Company Intellectual Property included in clause (iv) thereof that is material to the conduct of the business as
currently conducted. The Company has paid all necessary registration, maintenance and renewal fees for the purpose of maintaining such Company Intellectual Property. 
 (c)        Schedule 3.12(c) of the Disclosure Schedule contains a list of all Intellectual Property licensed to the Company by any third party
that is used in the Company’s business, excluding “off-the-shelf” or “shrink wrap” products licensed to the Company which are licensed in the ordinary course of business and as to which the Company has adequate site, user or
other applicable licenses. 
 (d)        Schedule 3.12(d) of the
Disclosure Schedule also contains a description of all licenses granted by the Company to any third party with respect to any Company Intellectual Property material to the Company’s business as currently conducted. 
 (e)        Except as set forth on Schedule 3.12 of the Disclosure Schedule,
(i) to the Company’s knowledge, the Company is not infringing or otherwise violating any Intellectual Property of any other Person and it is in material compliance with the terms of any license related to Intellectual Property licensed to
the Company and (ii) to the Company’s knowledge, no third party is infringing on any Company Intellectual Property. 
 (f)        The Company has taken reasonable steps to protect its rights in, and (to the extent confidential) the confidentiality of, (i) the Company Intellectual Property and (ii) any
Intellectual Property provided by any other Person to the Company, each material to the Company’s business as currently conducted. 
  

 -14- 

 3.13        Material
Contracts.  Set forth on Schedule 3.13 of the Disclosure Schedule is a list of all Material Contracts of the Company, showing the parties thereto. Each Material Contract is in full force and effect and the Company, and, to
the knowledge of the Company, each other party thereto has performed all material obligations required to be performed by them thereunder. The Company is not in default under any material provision of any Material Contract. To the knowledge of the
Company, no third party is in default under any material provision of any Material Contract. 
 As used herein, the term
“Material Contract” shall mean each written contract or agreement to which the Company is a party involving (i) aggregate consideration payable to or by the Company of $100,000 other than those contracts or agreements which
will be terminated at or prior to the Closing or are terminable by notice of not more than thirty (30) days without material liability to the Company), (ii) any agreement, contract or commitment relating to the disposition or
acquisition of assets or any interest in any business enterprise relating directly or indirectly to the Company, its current or historic business which contain any obligation of the Company which will continue after the Closing, (iii) any
mortgages, indentures, loans, security agreements or other instruments relating to the borrowing of money by the Company or under which any party has imposed or may, with notice or the lapse of time impose, a lien on any of the Company’s
assets, (iv) any distribution, joint marketing, development, partnership or joint venture agreement of the business of the Company, (v) any employment, severance, bonus, noncompetition or nonsolicitation agreement with any employee of the
Company, (vi) any agreement, contract or commitment containing any covenant limiting in any respect the right of the Company or any of its Affiliates to engage in any line of business or to compete with any person, (vii) any agreement that
provides for the payment or receipt by the Company of an ongoing license fee or royalty payment in excess of $100,000, (viii) any agreement or lease under which the Company is a lessee of or holds or operates any personal property owned by any
other party that is used in the Company’s business, (ix) any agreement involving a commitment to make capital expenditures in excess of $100,000, or (x) any agreement related to hazardous waste disposal, solid waste disposal, waste
water management, investigation of environmental matters, environmental remediation or any other material environmental obligation, liability or agreement. 
 3.14        Litigation.  Except as disclosed on Schedule 3.14 of the Disclosure Schedule, there is no action, arbitration,
litigation, proceeding or governmental investigation pending or, to the knowledge of the Company, threatened against the Company. 
 3.15        No-Conflict; Required Consents and Approvals.  Except as set forth on Schedule 3.15 of the Disclosure Schedule and except for applicable filings under the HSR
Act, the Company’s execution, delivery and performance of this Agreement and the other agreements, instruments and documents of the Company contemplated hereby will not result in any material violation of, be in material conflict with or
constitute a material default under the Company Charter Documents, any Material Contract, any Authorization or any Legal Requirement. Except as set forth on Schedule 3.15 of the Disclosure Schedule and except for applicable filings and
approvals under the HSR Act, no material consent, order, approval, authorization, declaration or filing with or from any governmental authority or any party to a Material Contract is required on the part of the Company for or in connection with the

  

 -15- 

 execution and delivery of this Agreement or the consummation of the transactions contemplated hereby by
the Company. 
 3.16        Licenses and
Permits.  Schedule 3.16 of the Disclosure Schedule sets forth a list of all licenses, permits and authorizations of governmental authorities held by the Company which are material to the business of the Company as it is
currently conducted (except for licenses, permits and authorizations relating to Environmental Laws, as to which Section 3.22 only applies) (collectively, the “Authorizations”). The Authorizations are in full force and effect.
The Company is in material compliance with the Authorizations. To the knowledge of the Company, no governmental authority has threatened the amendment, suspension or cancellation of any Authorization, except where such threatened suspension or
cancellation relates to such items of noncompliance that the Company had previously remedied or will remedy within the applicable cure periods. 
 3.17        Compliance with Laws.  The Company is in material compliance with all Legal Requirements (except as to Taxes, as to which Section 3.9 only
applies, to Benefit Plans, as to which Section 3.19 only applies, and to Environmental Laws, as to which Section 3.22 only applies). As used herein, the term “Legal Requirements” means, with respect to any Person, all
foreign, federal, state, and local statutes, laws, ordinances, judgments, decrees, and orders and all governmental rules and regulations applicable to such Person. 
 3.18        Employees and Compensation.  Schedule 3.18 of the Disclosure Schedule sets forth (i) a true and correct list of the
name and current annual salary of each officer or employee of the Company whose annual base salary exceeds $75,000 and (ii) any other form of compensation (other than salary, bonuses or customary benefits) paid or payable by the Company to each
such officer or employee for the most recent fiscal year. Except as contemplated by Section 6.1(i), to the Company’s knowledge no employee identified on Schedule 3.18 has any present intention to terminate his or her employment
with the Company within the next 12 months or is bound by any confidentiality agreement, non-competition agreement or other contract that may reasonably be expected to have an adverse effect on such employee’s participation in the
Company’s business. The Company has complied in all material respects with all provisions of all Legal Requirements relating to employment and employment practices, terms and condition of employment, wage and hours and similar matters.

 3.19        Benefit Plans. 
 (a)        Schedule 3.19(a) of the Disclosure Schedule sets forth all material
employee benefit plans, programs, policies, practices, agreements and arrangements (including, but not limited to, all plans described in Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended
(“ERISA”)) maintained or contributed to by the Company for the benefit of any of its current or former officers, employees, directors or independent contractors, or with respect to which the Company has (or reasonably could be
expected to have) any obligation or liability (including, but not limited to, liabilities arising from affiliation under Section 414(b), (c), (m) or (o) of the Code, or Section 4001 of ERISA) (each, a “Benefit
Plan” and collectively, the “Benefit Plans”). Except as disclosed on Schedule 3.19 of the Disclosure Schedule, there has been no amendment or announcement (written or oral) by the Company relating to a change in
participation or coverage under, any Benefit Plan that could reasonably be 
  

 -16- 

 expected to materially increase the expense of maintaining such Benefit Plan above the level of expense
incurred with respect thereto for the most recent fiscal year included in the financial statements provided pursuant to Section 3.7. Each Benefit Plan can be terminated by the Company at any time without material liability or expense (other
than for any benefits accrued thereunder at the time of such termination). None of the rights of the Company under any Benefit Plan will be impaired in any way by the consummation of the transactions contemplated by this Agreement. 
 (b)        With respect to each Benefit Plan, the Company has made available to the Buyer
(to the extent applicable to such Benefit Plan) true and complete copies of: (i) all documents embodying such Benefit Plan (including all amendments thereto) or, if such Benefit Plan is not in writing, a written description of such Benefit
Plan; (ii) the last three annual reports (Form 5500 series and all schedules and financial statements attached thereto) filed with respect to such Benefit Plan; (iii) the most recent summary plan description, and all summaries of
material modifications related thereto, distributed with respect to such Benefit Plan; (iv) all contracts and agreements (and any amendments thereto) relating to such Benefit Plan, including, without limitation, all trust agreements, investment
management agreements, annuity contracts, insurance contracts, bonds, indemnification agreements and service provider agreements; (v) the most recent determination letter issued by the Internal Revenue Service (the “IRS”) with
respect to such Benefit Plan; (vii) all written communications to employees or beneficiaries, generally (A) in which the provisions of such Benefit Plan, as set forth or described therein, differ materially from such provisions as set
forth or described in the other information or materials furnished under this subsection (b), or (B) relating to the amendment, creation or termination of such Benefit Plan, or to an increase or decrease in benefits, acceleration of payments or
vesting or any other event with respect to such Benefit Plan that could result in a material liability to the Company; (viii) all material correspondence to or from any governmental entity or agency relating to such Benefit Plan sent or
received in the past three (3) years; and (ix) all coverage, nondiscrimination, top heavy and Code Section 415 tests performed with respect to such Benefit Plan for the three most recently completed plan years. 
 (c)        Except as set forth on Schedule 3.19 of the Disclosure Schedule,
with respect to each Benefit Plan: (i) such Benefit Plan is, and at all times since inception has been, maintained, operated, administered and funded in accordance with its terms and all Legal Requirements in all material respects;
(ii) the Company and each other Person (including, without limitation, all fiduciaries) have, at all times and in all material respects, properly performed all of their duties and obligations under or with respect to such Benefit Plan;
(iii) all returns, reports, notices, statements and other disclosures relating to such Benefit Plan required to be filed with any governmental authority or distributed to any participant therein have been properly prepared and duly filed or
distributed in a timely manner; (iv) all contributions, premiums and other payments due or required to be paid to (or with respect to) such Benefit Plan have been timely paid, or, if not yet due, have been accrued as a liability on the Balance
Sheet; (v) no breach of fiduciary duty has occurred with respect to any Benefit Plan(vi) no “prohibited transaction” (within the meaning of either Section 4975(c) of the Code or Section 406 or 407 of ERISA) has
occurred with respect to such Benefit Plan; and (vii) the Company has not incurred, and there exists no condition or set of circumstances in connection with which the Company or Buyer could incur, directly or indirectly, any material liability
or expense (except for routine contributions and benefit payments) under ERISA, the Code or any other applicable Legal 
  

 -17- 

 Requirement or pursuant to any indemnification or similar agreement, with respect to such Benefit Plan.

 (d)        Each Benefit Plan that is intended to be qualified under
Section 401(a) of the Code is so qualified and each trust and group annuity contract related thereto is exempt from taxation under Section 501(a) of the Code. Each such Benefit Plan (i) is the subject of an unrevoked favorable
determination letter from the IRS with respect to such Benefit Plan’s qualified status under the Code, as amended by that legislation commonly referred to as “GUST” and “EGTRRA” and all subsequent legislation, (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 such prototype or volume submitter plan. To the Company’s knowledge, nothing has occurred, or is reasonably
expected by the Company or any Seller to occur, that could adversely affect the qualification or exemption of any such Benefit Plan or any trust or group annuity contract related thereto. The Company has been informed by the relevant third party
administrators that no such Benefit Plan is a “top-heavy plan,” as defined in Section 416 of the Code. 
 (e)        The Company is not, and has not within the past six (6) years been, a member of (i) a controlled group of corporations, within the meaning of Section 414(b) of the
Code, (ii) a group of trades or businesses under common control, within the meaning of Section 414(c) of the Code, (iii) an affiliated service group, within the meaning of Section 414(m) of the Code, or (iv) any other group
of Persons treated as a single employer under Section 414(o) of the Code. 
 (f)        The Company does not sponsor, maintain or contribute to, and has not previously sponsored, maintained or contributed to (or been obligated to sponsor, maintain or contribute to),
(a) a “multiemployer plan,” as defined in Section 3(37) or 4001(a)(3) of ERISA or 414(f) of the Code, (b) a multiple employer plan within the meaning of Section 4063 or 4064 of ERISA or Section 413(c) of the Code,
(c) an employee benefit plan that is subject to Part 3 of Subtitle B of Title I of ERISA, Title IV of ERISA or Section 412 of the Code, or (d) a “multiple employer welfare arrangement,” as defined in Section 3(40) of
ERISA. 
 (g)        Neither the Company nor any Benefit Plan provides or has
any obligation to provide (or contribute toward the cost of) life insurance, medical benefits or any other welfare benefits (within the meaning of Section 3(1) of ERISA) with respect to any current or former officer, employee, director, agent
or independent contractor of the Company after his or her retirement or other termination of service for any reason, except to the extent required by Part 6 of Subtitle B of Title I of ERISA and Section 4980B(f) of the Code. 
 (h)        There are no lawsuits or claims (other than routine claims for benefits)
pending or, to the knowledge of the Company, threatened with respect to (or against the assets of) any Benefit Plan, nor, to the Company’s knowledge is there a basis for any such lawsuit or claim. The Company has not been notified that any
Benefit Plan is currently under investigation, audit or review, directly or indirectly, by the IRS, the Department of Labor or any other government authority. 
  

 -18- 

 (i)        Schedule 3.19 of the
Disclosure Schedule sets forth a complete and accurate list of all “nonqualified deferred compensation plans” (within the meaning of Section 409A of the Code) sponsored or maintained by the Company (or to which the Company is (or was)
a party), and in which any of their current or former officers, employees, agents, directors or independent contractors participated at any time since January 1, 2005. Each such plan has been operated and administered since
January 1, 2005 in good faith compliance with Section 409A of the Code and any guidance issued by the United States Treasury Department or the IRS thereunder (including, without limitation, IRS Notice 2005-1, the proposed
Treasury regulations issued on September 29, 2005, and the final Treasury regulations issued on April 10, 2007), to the extent applicable to such plan. No such plan has been “materially modified” (within the meaning of IRS Notice
2005-1 or Proposed Treasury Regulation Section 1.409A-6(a)(4)) at any time after October 3, 2004. 
 (j)        Except as set forth on Schedule 3.19 of the Disclosure Schedule, neither the execution of this Agreement nor the consummation of the transactions contemplated by this
Agreement will (i) result in any benefit or right becoming established or increased, or accelerate the time of payment or vesting, under any Benefit Plan, (ii) increase the amount of compensation due to any individual or forgive any
indebtedness owed by any individual, or (iii) entitle any individual to severance pay, unemployment compensation or any other payment from the Company, Seller or any Benefit Plan. 
 3.20        Insurance.  The Company is insured under the insurance policies
listed on Schedule 3.20 of the Disclosure Schedule. The Company is in compliance in all material respects with the terms and provisions of such insurance policies. Except as disclosed on Schedule 3.20 of the Disclosure
Schedule, as of the date hereof, there are no pending claims under any such insurance policy as to which the respective insurers have denied coverage, or provided the Company notice that a defense will be afforded with reservation of rights. The
insurance policies maintained by the Company are of the type and in amounts customarily carried by persons conducting businesses similar to those of the Company in the jurisdiction in which the Company operates. 
 3.21        Brokers.  Except as set forth on Schedule 3.21 of the
Disclosure Schedule, the Company has not engaged any broker, finder or similar agent with respect to the transactions contemplated by this Agreement, and the Company is not under any obligation to pay any broker’s fee, finder’s fee or
commission in connection with the consummation of the transactions contemplated by this Agreement as a result of any agreement of the Company. 
 3.22        Compliance with Environmental Laws.  Each of the representations and warranties set forth in this Section 3.22 is subject in all respects to
the further qualifications and disclosures set forth on Schedule 3.22 of the Disclosure Schedule. 
 (a)        For purposes of this Agreement, the following definitions shall apply: 
 (i)        “Environment” shall mean soil, surface waters, sediments, groundwaters, land, surface, subsurface strata, ambient air, fish, plant, wildlife,
habitat and any other environmental medium or natural resources. 
  

 -19- 

 (ii)        “Environmental Claim” shall mean any litigation, proceeding, order, claim, demand, directive, summons, notice, cause of action, complaint or citation, relating to
Environmental Laws or Hazardous Substances. 
 (iii)        “Environmental Laws” shall mean all foreign, federal, state and local statutes, regulations, rules and ordinances relating to pollution or the protection of the
Environment, Hazardous Substances or the discharge of materials into the Environment. 
 (iv)        “Hazardous Substances” shall mean any substance which is a “hazardous substance,” “hazardous waste,” “toxic substance,” “toxic
waste,” “pollutant,” “contaminant” or words of similar import under any Environmental Law including, without limitation, the Comprehensive Environmental Response, Compensation and Liability Act (42 U.S.C. §9601 et
seq.), the Resource Conservation and Recovery Act (42 U.S.C. §6901 et seq.), the Federal Water Pollution Control Act (33 U.S.C. §1251 et seq.), and the Clean Air Act (42 U.S.C. §7401 et seq.), and including, without limitation, which
contains polychlorinated biphenyl, asbestos, or gasoline, diesel fuel or other petroleum hydrocarbons or volatile organic compounds. 
 (b)        The operations of the Company have at all times been and are in material compliance with all applicable Environmental Laws. 
 (c)        The Company has at all times possessed and currently possesses all material
permits, licenses and authorizations required under applicable Environmental Laws, and the operations of the Company have at all times been and are in material compliance with the terms and conditions of such required permits, licenses and
authorizations. 
 (d)        There are no pending or, to the knowledge of
the Company, threatened Environmental Claims against the Company. 
 (e)        The Company’s operations have not resulted in a spill or release of Hazardous Substances into the Environment that would be reasonably likely to give rise to remediation costs
in excess of $100,000. Except as set forth on Schedule 3.22(e), the Company has no knowledge of any spills or releases of Hazardous Substances at, from, onto or under any real property leased or operated by the Company. 
 (f)        None of the following exists at any property or facility owned or operated by
the Company: (i) underground storage tanks; (ii) friable asbestos-containing materials; (iii) materials or equipment containing polychlorinated biphenyls; or (iv) landfills, surface impoundments or hazardous waste disposal areas.

 (g)        The Company has not either expressly or by operation of law,
assumed or undertaken any liability, including without limitation any material obligation for corrective or remedial action, of any other Person related to any Environmental Laws. 
 (h)        The Company has provided Buyer with complete and accurate copies of all
environmental assessments and reports in its possession that relate to the operations of the Company or any real property leased by the Company. 
  

 -20- 

 3.23        Affiliate
Transactions.  Except for employment relationships and the payment of compensation and benefits in the ordinary course of business or as disclosed on Schedule 3.23 of the Disclosure Schedule, the Company is not a party to
any Material Contract or other arrangement with any stockholder, officer, director or Affiliate of the Company. As used herein, the term “Affiliate” shall have the meaning given to it under Rule 405 promulgated under the
Securities Act of 1933, as amended. 
 3.24        Customers and
Suppliers.  To the knowledge of the Company no Major Customer or Major Supplier has notified the Company that it intends to terminate or modify its relationship with the Company. Except as set forth on Schedule 3.24 of the
Disclosure Schedule, no Major Customer or Major Supplier of the Company has during the last twelve months materially decreased or limited, or threatened to materially decrease or limit, its purchase of the Company’s products, or its supply of
materials or services to the Company, as the case may be. Schedule 3.24 of the Disclosure Schedule lists the ten largest customers of the Company by sales during the period from January 1, 2006 through June 30, 2008 (each a
“Major Customer”). Schedule 3.24 of the Disclosure Schedule also lists the ten largest suppliers of the Company by expenses of the Company for materials or services purchased during the period from January 1, 2006
through June 30, 2008 (each a “Major Supplier”). 
 3.25        Absence of Questionable Payments.  None of the Company or, to the knowledge of the Company, any director, officer, agent, employee or other person acting on behalf
of the Company has used, any of the Company’s funds for unlawful contributions, payments, gifts or entertainment, or made any unlawful expenditures relating to political activity to any government official or other person. None of the Company
or, to the knowledge of the Company, any officer, director, agent, employee other person acting on behalf of the Company has accepted or received any unlawful contributions, payments, gifts, or expenditures in connection with the operation of the
Company’s business. 
 3.26        Product Warranties; Defects;
Liabilities.  Each product manufactured, sold, licensed, leased or delivered by the Company has been in material conformity with all applicable contractual commitments and all expressed and implied warranties. The Company does not have
any material liability (and to the knowledge of the Company, as of the date of this Agreement, there is no current reasonable basis for any present action, suit, proceeding, hearing, investigation, charge, complaint or claim against the Company
relating to any product giving rise to any material liability) for replacement or repair thereof or any damages in connection therewith. No product manufactured, sold, licensed, leased or delivered by the Company is subject to any guaranty, warranty
or other indemnity beyond the applicable standard terms and conditions of sale, license or lease or beyond that implied or imposed by applicable law or to any current recall whether initiated due to the action of any governmental authority, private
party or otherwise. 
 3.27        Government Contracts.  The
Company is not now, nor has it previously been, suspended or debarred from bidding on contracts or subcontracts for any agency of the United States government or any foreign government, nor to the knowledge of the Company has such a suspension or
debarment been threatened or action for suspension or debarment been commenced. The Company has not been nor is it currently being audited, except in the ordinary course of business or as is customary in the industry or as provided by the Federal

  

 -21- 

 Acquisition Regulations or, to the knowledge of the Company, investigated by any agency of the United
States government or any foreign government nor to the knowledge of the Company has such audit or investigation been threatened. To the knowledge of the Company, there is no valid basis for the Company’s suspension or debarment from bidding on
contracts or subcontracts for any agency of the United States government or any foreign government and, to the knowledge of the Company, there is no valid basis for a claim pursuant to an audit or investigation by any agency of the United States
government or any foreign government, or any prime contractor with any such governmental authority. The Company has not had a contract or subcontract terminated for default by the Company by any agency of the United States government or any foreign
government. The Company does not have any outstanding agreements, contracts or commitments that require it to obtain or maintain a government security clearance. 
 ARTICLE 4 
 REPRESENTATIONS AND WARRANTIES OF THE BUYER 
 The Buyer hereby represents and warrants to the Sellers and the Company that each of the statements contained in this Article 4 is
true and correct as of the date hereof. 
 4.1        Organization, Power and
Standing.  The Buyer is a Delaware duly organized, validly existing and in good standing under the laws of the State of Delaware, with all requisite power and authority to own, lease and operate its properties and to carry on its
business as such business is conducted on the date hereof. 
 4.2        Power and
Authority; No-Conflict.  The Buyer has full power and authority and has taken all required action necessary to permit it to execute and deliver and to carry out the terms of this Agreement and all other agreements, instruments and
documents to be executed and delivered by the Buyer as contemplated hereby and none of such actions will result in any violation of, be in conflict with or constitute a default under any charter, by-law, organizational document, Legal Requirement,
contract, agreement or instrument to which the Buyer is a party or by which the Buyer or its assets are bound. 
 4.3        Consents and Approvals.  Except for any applicable filings under the HSR Act, no consent, order, approval, authorization, declaration or filing from or with any
governmental authority or third party is required on the part of the Buyer for or in connection with the execution, delivery and performance of this Agreement or any other agreement, instrument or document contemplated hereby by the Buyer and the
consummation by the Buyer of any of the transactions contemplated herein or therein. 
 4.4        Validity and Enforceability.  Assuming the valid execution and delivery by the other parties hereto and thereto, this Agreement constitutes, and each other agreement,
instrument and document of the Buyer contemplated hereby will be when executed and delivered by the Buyer, the valid and legally binding obligation of the Buyer, enforceable against it in accordance with their respective terms, subject, however, to
applicable bankruptcy, insolvency and other laws affecting the rights and remedies of creditors and to general equitable principles. 
  

 -22- 

 4.5        Brokers.  The Buyer
has not engaged any broker, finder or similar agent with respect to the transactions contemplated by this Agreement, and the Buyer is not under any obligation to pay any broker’s fee, finder’s fee, commission or similar amount in
connection with the consummation of the transactions contemplated by this Agreement. 
 4.6        Investment Representations. 
 (a)        The Buyer is acquiring the Purchased Shares for its own account for investment only, and not with a view to, or for sale in connection with, any distribution of the Purchased Shares
in violation of the Securities Act of 1933, as amended (the “Securities Act”), any rule or regulation under the Securities Act, or any state securities laws. 
 (b)        The Buyer has had such opportunity as it has deemed adequate to obtain from management of the Company such information about the business
and affairs of the Company as is necessary to permit the Buyer to evaluate the merits and risks of its investment in the Company. 
 (c)        The Buyer has sufficient experience in business, financial and investment matters to be able to evaluate the merits and risks involved in the purchase of the Purchased Shares and to
make an informed investment decision with respect to such purchase. 
 (d)        The Buyer is an “accredited investor” within the meaning of Rule 501 promulgated under the Securities Act. 
 (e)        The Buyer understands that the Purchased Shares have not been registered under
the Securities Act or any other securities laws and are therefore “restricted securities” within the meaning of Rule 144 under the Securities Act, and the Purchased Shares cannot be sold, transferred or otherwise disposed of unless they
are subsequently registered under the Securities Act and applicable securities laws, or an exemption from registration is then available. 
 4.7        Financial Ability.  The Buyer has, and will have at the Closing, the financial capability to consummate the transactions contemplated by this
Agreement, and the Buyer understands that under the terms of this Agreement the Buyer’s obligations hereunder are not in any way contingent or otherwise subject to (a) the Buyer’s consummation of any financing arrangements or the
Buyer’s obtaining any financing or (b) the availability of any financing to the Buyer. 
 4.8        No Other Agreements.  Except for the agreements expressly contemplated hereby, neither the Buyer nor any of its Affiliates has any other agreements, arrangements or
understandings with any director, officer, employee, consultant, stockholder or Affiliate of the Company in respect of the transactions contemplated hereby. 
 4.9        No Other Representations or Warranties of the Sellers or the Company.  The Buyer has been provided access and an opportunity to
review information in respect of the business of the Company requested by the Buyer. In entering into this Agreement, Buyer is exclusively relying on the representations and warranties made by each Seller to the Buyer expressly set forth in
Article 2 of this Agreement (as modified by the Disclosure Schedule), the representations and warranties made by the Company to the Buyer expressly set forth in 
  

 -23- 

 Article 3 of this Agreement (as modified by the Disclosure Schedule) and the covenants and
agreements set forth in this Agreement. 
 ARTICLE 5 
 COVENANTS 
 5.1        Access to
Information; Confidentiality. 
 (a)        If reasonably requested by
the Buyer, the Sellers and the Company shall permit the Buyer and its counsel, accountants and other representatives access, upon reasonable notice and during normal business hours throughout the period prior to the Closing, to the properties, books
and records of the Company. Any such access shall be managed by and conducted through those representatives of the Company identified by the Company, and shall be subject to such additional limitations as the Company may reasonably require to
prevent disclosure of the transactions contemplated hereby, the disruption of the business of the Company and/or the disclosure of any confidential or legally privileged information. While it is contemplated that Buyer will contact the
Company’s material customers and suppliers as part of its confirmatory due diligence investigation, neither the Buyer nor any of its Affiliates or representatives shall, directly or indirectly, contact any customer, dealer, distributor, vendor,
supplier or service provider of the Company concerning the Company or the transactions contemplated by this Agreement without first obtaining the Company’s written consent. 
 (b)        The confidentiality agreement between the Company (or its financial advisor)
and the Buyer or an Affiliate of the Buyer dated June 18, 2008 (the “Confidential Agreement”) shall remain in full force and effect and shall be applicable to the Buyer and its Affiliates and representatives. 
 5.2        Conduct of Business.  Between the date of this Agreement and the
Closing or earlier termination of this Agreement, unless the Buyer shall otherwise consent in writing (such consent not to be unreasonably withheld, delayed or conditioned) and except as set forth on Schedule 5.2 of the Disclosure
Schedule, as otherwise contemplated by this Agreement or as required by any Legal Requirement: 
 (a)        Required Actions.  The Company shall: 
 (i)        maintain its legal existence; 
 (ii)        conduct its business only in the ordinary course; and 
 (iii)        use reasonable efforts to operate in such a manner as to assure that the representations and warranties of the Company set forth in this Agreement will be
true and correct in all material respects as of the Closing Date with the same force and effect as if such representations and warranties had been made on and as of the Closing Date. 
 (b)        Prohibited Actions.  The Company shall not do any of the following:

 (i)        effect any material change to the Company
Charter Documents; 
  

 -24- 

 (ii)        acquire or
dispose of any material properties or assets, except in the ordinary course of business; 
 (iii)        incur any indebtedness for borrowed money, other than in the ordinary course of business; 
 (iv)        subject any of its properties or assets to any Lien, other than Permitted Liens; 
 (v)        make any non-cash dividend or distribution on its shares of
stock; 
 (vi)        modify or amend in any material respect
or cancel or terminate any Material Contract, other than in the ordinary course of business; 
 (vii)        make any material change in its Tax or accounting practices, other than any change required by applicable law or GAAP; 
 (viii)        make any material change to any Tax election or Tax Return,
other than any change required by law; 
 (ix)        acquire
any business, whether by merger or consolidation, purchase of substantial assets or equity interests or any other manner; 
 (x)        make any material increase in the cash compensation of any employee, other than salary increases and other changes in compensation in the ordinary course of
business and any payments (including Sale Bonuses) to employees from the Closing Purchase Price; 
 (xi)        make any material change to any of the Benefit Plans, except to the extent required by the terms of such Benefit Plan or applicable law; or 
 (xii)        commit to do any of the foregoing. 
 5.3        Exclusivity.  From the date of this Agreement until the Closing Date
or the earlier termination of this Agreement, neither the Company nor any of the Sellers will, directly or indirectly, solicit any competing offers for the acquisition of the Company, or the sale of all or substantially all of the assets or business
of the Company, or negotiate with respect to any unsolicited offer or indication of interest with respect to any such acquisition or sale. 
 5.4        Consents and Approvals.  From the date of this Agreement until the Closing Date or the earlier termination of this Agreement, the parties shall
cooperate and use all reasonable efforts to obtain all third party, governmental and regulatory consents, approvals and actions necessary to consummate the transactions contemplated hereby which are required to be obtained by any Legal Requirement
or Material Contract. 
 5.5        HSR Act Filings.  To the extent
required in connection with the transactions contemplated by this Agreement, within five (5) business days following the date of execution of this Agreement the parties shall promptly make or cause to be made any and all required

  

 -25- 

 filings under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the “HSR
Act”), and will request early termination of the waiting period required under the HSR Act. The parties agree to cooperate and promptly respond to any inquiries or investigations initiated by the Federal Trade Commission or the Department
of Justice in connection with any such filings. 
 5.6        Reasonable
Efforts.  From the date of this Agreement until the Closing Date or the earlier termination of this Agreement, the parties agree to act in good faith and use reasonable efforts to satisfy the conditions specified in this Agreement
necessary to consummate the transactions contemplated hereby. 
 5.7        Tax
Matters. 
 (a)        Tax Indemnification.  Each Seller,
severally and not jointly, agrees to indemnify the Buyer and hold it harmless against and in respect of (i) any and all Pre-Closing Taxes and related Losses; and (ii) any and all Taxes and related Losses incurred by the Buyer or the
Company that arise or result from the failure of the Company or the Sellers to perform any of their covenants or agreements contained in this Section 5.7, in each case, except to the extent such Taxes and related Losses were reflected on the
statement of the Closing Working Capital and taken into account in the calculation of the Closing Purchase Price. Notwithstanding anything to the contrary in this Agreement, Seller’s indemnification obligations under this Section 5.7(a)
shall not be subject to the limitations and conditions set forth in Section 7.2(b). 
 (b)        Tax Refunds.  After the Closing, all refunds received or receivable by the Buyer or the Company in respect of Taxes paid prior to the Closing or in respect of any
Pre-Closing Tax Period shall be paid by the Buyer or the Company to each applicable Seller promptly upon receipt, except to the extent such refunds were reflected on the statement of the Closing Working Capital and taken into account in the
calculation of the Closing Purchase Price. Neither the Buyer nor the Company shall amend the Tax Returns of the Company in respect of Taxes paid prior to the Closing or in respect of any Pre-Closing Tax Period in a manner which would increase the
Sellers’ tax liability without the prior written consent of the Sellers (such consent not to be unreasonably withheld, delayed or conditioned). 
 (c)        Tax Returns. 
 (i)        The Company shall prepare or cause to be prepared, and timely file, all Tax Returns required to be filed by the Company, the due date of which (taking account extensions) occurs on
or before the Closing Date, and the Company shall pay all Taxes due with respect to any such Tax Returns. Prior to the due date for filing such Tax Returns, the Company shall make available to the Buyer a draft of such Tax Returns as the Company
proposes to file. The Representative shall prepare of cause to be prepared all federal, state, local and foreign income and franchise Tax Returns of the Company for the Pre-Closing Tax Period required to be filed by the Company, the due date of
which (taking account extensions) occurs after the Closing Date, and will make available to the Buyer drafts of such returns for its review and approval prior to filing (such approval not to be unreasonably withheld, delayed or conditioned). The
Buyer shall prepare or cause to be prepared, and timely file, all other Tax Returns of the Company for the Pre-Closing Tax 
  

 -26- 

 Period. All Tax Returns of the Company for any Pre-Closing Tax Period shall be prepared
in a manner consistent with the past practice of the Company, except as required by law. 
 (ii)        For purposes of this Agreement, in the case of any Taxes that are payable for a Straddle Period, the portion of such Tax attributable to the Pre-Closing Tax Period shall (A) in
the case of any Taxes other than Taxes based upon or related to income, sales, gross receipts, wages, capital expenditures or expenses, be deemed to be the amount of such Tax for the Straddle Period multiplied by a fraction the numerator of which is
the days in the Pre-Closing Tax Period and the denominator of which is the number of days in the Straddle Period, and (B) in the case of any Tax based upon or related to income, sales, gross receipts, wages, capital expenditures or expenses, be
deemed to equal to the amount which would be payable if the Pre-Closing Tax Period ended on the Closing Date. 
 (d)        Section 338(h)(10) Election. 
 (i)        The Sellers shall join with the Buyer in making an election under Section 338(h)(10) of the Code (and any comparable election under state, local or foreign law) (the
“Section 338 Elections”) with respect to the purchase and sale of the Purchased Shares. Sellers shall prepare and deliver at the Closing (or such other times as Buyer may request or as required by the Code in order to effectuate the
Section 338 Elections) an executed Form 8023 (and any corresponding or similar forms under state, local or foreign law). 
 (ii)        The Buyer and the Sellers agree to cooperate fully with each other in the making of the Section 338 Elections. Except as provided in
Section 5.7(d)(i) and Section 6.1(l), in connection with making the Section 338 Elections under applicable law, the Sellers shall prepare a complete set of forms and any additional data or materials (including any allocation of
purchase price as required under the Code or regulations) required to be filed (the “Section 338 Forms”) for the Buyer’s review and approval at least 30 days prior to the due date for filing such forms, approval not to be
unreasonably withheld. The Buyer and the Sellers shall file all Tax Returns in a manner consistent with the Section 338 Elections and the Section 338 Forms. 
 (iii)        The Sellers shall be responsible for and shall pay any and
all Taxes attributable to the purchase and sale of the Purchased Shares and the making of the Section 338 Elections (including, without limitation, any Taxes imposed on the Company under Section 1374 of the Code, and any comparable
provision under state, local or foreign law, or otherwise). 
 (iv)        Neither the Company nor the Sellers shall take or allow any action that could result in the inability of the Sellers and the Buyer to make valid Section 338 Elections.

 (e)        Tax Audits.  The Buyer shall promptly notify the
Representative in writing with respect of any matter which may give rise to a claim for indemnification against the Sellers pursuant to Section 5.7(a) (each, a “Tax Matter”) upon learning of such claim or the facts constituting
such claim, describing the claim in reasonable detail, the amount thereof, and the 
  

 -27- 

 basis therefor; provided, however, that failure of the Buyer to give Sellers notice as
provided herein will not relieve Sellers of their indemnification obligations hereunder, except to the extent that Sellers are prejudiced by the Buyer’s failure to give such prompt notice. The Representative shall have the right, as to any Tax
Matter, if the Representative notifies the Buyer that he or she will defend such Tax Matter within ten (10) days after receipt of such notice and commences the defense of such Tax Matter and the Sellers agree that the Sellers are obligated to
indemnify the Buyer with respect to the full amount in dispute in such Tax Matter, (i) to control, in whole or in part, any Tax audit, examination, contest or proceedings, (ii) to resolve and defend against any assessment, notice of
deficiency, or other adjustment or proposed adjustment, (iii) to consent to any extension or waiver of the limitations period applicable to any Tax Matter, (iv) to initiate any claim for refund of Taxes related to a Pre-Closing Tax Period,
and (v) to amend any Tax Return related to a Pre-Closing Tax Period only upon a final settlement or a Tax Matter, in each case solely to the extent relating to Taxes attributable to a Pre-Closing Tax Period or Taxes otherwise attributable to a
Tax Matter; provided, however, Representative shall not enter into any settlement of or otherwise compromise any such Tax Matter to the extent that it can reasonably be expected to adversely affect the Tax liability of the Buyer or any
affiliate thereof for any taxable period ending after the Closing Date without the prior written consent of the Buyer (such consent not to be unreasonably withheld, delayed or conditioned), and provided further, the Buyer may
participate in any such audit, examination, contest or proceedings with counsel of its choice at its own expense. In the event of a conflict between the provisions of this Section 5.7(e) and Section 7.4, the provisions of this
Section 5.7(e) shall control. 
 (f)        Cooperation in Tax
Matters.  Each party to this Agreement (a “Party,” or collectively, the “Parties”) shall provide the other Parties with such assistance as may be reasonably requested by such Party in connection with the
preparation of any Tax Return, any audit or other examination by any taxing authority, or any judicial or administration contest or proceedings relating to liability for Taxes, and shall provide the other Parties with any available records or
information that may be relevant to such Tax Return, audit, examination, contest, proceedings or determination. Such assistance shall include making employees available on a mutually convenient basis to provide additional information and explanation
of any material provided hereunder and shall include providing copies of any relevant Tax Return and supporting work schedules. The Party requesting assistance hereunder shall reimburse the other Parties for reasonable out-of-pocket expenses
incurred in providing such assistance. 
 (g)        S
Election.  The Company and the Sellers shall not revoke the Company’s election to be treated as an S corporation within the meaning of Sections 1361 and 1362 of the Code (and any corresponding state or local tax provision), and
shall not take or allow any action that could result in the termination of the Company’s status as a validly electing S corporation. 
 5.8        Directors’ and Officers’ Indemnification 
 (a)        In the event of any threatened or actual claim, action, suit, proceeding or investigation, whether civil, criminal or administrative (each, a
“Proceeding”), in which any Person who is now, or has been at any time prior to the Closing, a director, officer, employee or Affiliate of the Company (the “Indemnified Persons”) is, or is threatened to be, made a
party thereto based in whole or in part on the fact that such Person is or was a director, officer, employee or Affiliate of the Company, whether in any case asserted or arising before, on or after 
  

 -28- 

 the Closing, the Company shall, to the fullest extent permitted by law, indemnify and hold harmless such
Indemnified Person from and against any and all losses, claims, damages, liabilities, costs, expenses (including reasonable attorneys’ fees and expenses in advance of the final disposition of any Proceeding to each Indemnified Person to the
fullest extent permitted by law), judgments, fines and amounts paid in settlement incurred in connection with or arising out of such Proceeding. 
 (b)        An Indemnified Person shall notify the Company of the existence of a Proceeding for which such Indemnified Person is entitled to indemnification hereunder as
promptly as reasonably practicable after such Indemnified Person learns of such Proceeding; provided, that the failure to so notify shall not affect the obligations of the Company under this Section 5.8 except to the extent such failure
to notify actually prejudices the Company. The Company, at its expense, shall have the right to control the defense of the Proceeding with counsel selected by the Company and reasonably acceptable to the Indemnified Person. The Indemnified Person
and the Company shall cooperate fully with each other in connection with the defense of any Proceeding. No settlement of a Proceeding may be made by the Company without the Indemnified Person’s consent which consent will not be unreasonably
withheld, delayed or conditioned, except for a settlement which requires no more than a monetary payment for which the Indemnified Person is fully indemnified and which does not require the admission of liability. No settlement of a Proceeding may
be made by an Indemnified Person without the consent of the Company, unless such consent is unreasonably withheld, delayed or conditioned. 
 (c)        The provisions of this Section 5.8 are intended to be for the benefit of, and enforceable by, each Indemnified Person and such Indemnified Person’s
estate, heirs and representatives, and nothing herein shall affect any indemnification rights that any Indemnified Person or such Indemnified Person’s estate, heirs and representatives may have under the Company Charter Documents, any Legal
Requirements, any contract or otherwise. 
 (d)        The obligations of the
Company under this Section 5.8 shall continue in full force and effect for a period commencing as of the Closing and ending as of the later of (i) the six (6) year anniversary of the Closing and (ii) the date that all
applicable statute of limitation periods have expired for any claim or claims for which an Indemnified Person may be entitled to indemnification under this Section 5.8; provided, that all rights to indemnification in respect of any claim
for indemnification under this Section 5.8 asserted or made within such period shall continue until the final disposition of such claim. 
 5.9        Books and Records.  From and after the Closing, the Buyer will cause the Company to maintain a reasonable records retention policy. After the
Closing, the Sellers and their accountants, lawyers and other representatives shall be entitled at all reasonable times to have access to and to make copies of the books and records and other information of the Company for the period prior to the
Closing for the preparation of Tax Returns and the defense of litigation related to the Sellers’ ownership of the Company or otherwise related to Sellers’ obligation to provide indemnification pursuant to this Agreement. In the event of
any litigation or threatened litigation between the parties relating to this Agreement or the transactions contemplated hereby, the covenants contained in this Section 5.9 shall not be considered a waiver by any party of any right to assert the
attorney-client privilege. 
  

 -29- 

 5.10        WARN Act.  Neither
the Buyer nor the Company will, at any time prior to one hundred eighty (180) days after the Closing Date, effectuate a “plant closing” or “mass layoff” as those terms are defined in the Worker Adjustment and Retraining
Notification Act or any similar termination or reduction in force under any Legal Requirement including, without limitation, California Labor Code Section 1400 et. seq. 
 5.11        Noncompete.  Following the Closing Date, for a period of five
(5) years (the “Restricted Period”), each of the Sellers covenants that it will not and will cause its Affiliates to not, directly or indirectly acquire, own, participate or engage in, or be employed by, an entity (other than
the Company) anywhere in the United States that designs, manufactures, distributes or provides products or services related to fasteners and/or hydraulic, air, fuel, fluid, mechanical and electrical line management solutions used in the aerospace
industry and custom molding for automotive, medical and consumer markets; provided, however, that, for purposes of this Section 5.11, ownership of securities having less than five percent (5%) of the outstanding voting power of any
competitor which are listed on any national securities exchange shall not be deemed to be in violation of this Section 5.11 as long as the Seller owning such securities has no other connection or relationship with such competitor; and, provided
further, that the employment of Douglas P. Stephen Jr. by Precision Tube Bending and any successor shall not be deemed to be in violation of this Section 5.11; provided that Precision Tube Bending continues to offer products and services
substantially similar to those currently offered and that it does not expand its business to being directly competitive with the Company’s products and services. With respect to the Company’s executive, managerial, technical and sales
personnel (“Key Employees”) and any of the Company’s customers and suppliers (such customers and suppliers, together with the Key Employees, being “Company Contacts”), each Seller covenants that such Seller
will not directly or indirectly, without Buyer’s prior written consent, solicit or otherwise interfere with the relationship between the Company and any Company Contact during the Restricted Period for as long as such Company Contact maintains
its relationship with the Company; provided, however, that if any Key Employee responds to a general solicitation to the public or other general advertising conducted by any Seller during the Restricted Period, such general solicitation or general
advertising shall not be deemed to be a violation of this Section 5.11 provided that Seller does not hire such Key Employee during the Restricted Period. In addition, each of the Sellers agrees that, during the Restricted Period, it will not,
without Buyer’s prior written consent, hire any Key Employee formerly employed by the Company within six months of the termination of such Key Employee’s relationship with the Company in substantially the same capacity as such terminated
employee was employed by the Company. 
 5.12        Transition Period for AgFast
Corporation.  For a period of sixty days after the Closing Date, Buyer hereby agrees, on the same terms and conditions as currently in effect, to continue: (a) to grant a license to AgFast Corporation to continue accessing and
using the same office and warehouse space currently used by it and (b) providing to AgFast Corporation the same level of accounting and customer service support. 
 5.13        Inventory Repurchase Covenant. 
 (a)        Within 90 days of the first anniversary of the Closing Date, the Buyer may provide the Representative a written notice (the “Inventory
Notice”) that identifies: (i) (A) any 
  

 -30- 

 line of finished goods by SKU that existed as of the Closing Date for which the Company has had no sales
in the year following the Closing Date; or (B) any type of component parts that comprise any finished goods for which the Company has either had no sales or for which no units of such component parts have been consumed in the creation of any
finished goods in the year following the Closing Date (an “Unsold Inventory Line”); (ii) the number of units comprising one hundred percent of such Unsold Inventory Line held by the Company; and (iii) the standard cost per
unit for such Unsold Inventory Line reflected in the books and records of the Company as of the Closing Date (the “Standard Cost”). In no event shall the Buyer be entitled to deliver an Inventory Notice to purchase less than one
hundred percent of the units comprising the Unsold Inventory Line held by the Company. If Buyer elects to deliver an Inventory Notice to the Representative, the Representative will be granted reasonable access to the Company’s books and records
to confirm the information contained in the Inventory Notice. 
 (b)        If the Representative does not object to the information contained in the Inventory Notice by providing written notice of objection within twenty (20) days of receipt,
specifying in reasonable detail the amount and basis of their objection, each Seller will purchase from the Buyer its Pro Rata Share of, and the Buyer will deliver to the Representative, one hundred percent of the units comprising the Unsold
Inventory Line held by the Company at a per unit price equal to the Standard Cost contained in the Inventory Notice. 
 (c)        If the Sellers dispute the information contained in the Inventory Notice, and the parties cannot resolve such dispute through good faith negotiations during the thirty (30) days
following receipt of the dispute notice from the Representative, then either the Buyer or the Representative may present the dispute to the Independent Accountant in accordance with the procedures described in Section 1.7(c). In the event that
the Independent Accountant determines that the Sellers must purchase an Unsold Inventory Line and the Standard Cost for such Unsold Inventory Line, each Seller will purchase from the Buyer its Pro Rata Share of, and the Buyer will deliver to the
Representative, one hundred percent of the units comprising the Unsold Inventory Line held by the Company at a per unit price equal to the Standard Cost determined by the Independent Accountant. 
 (d)        In the event that the Sellers purchase an Unsold Inventory Line pursuant to
this Section 5.13 and the Buyer subsequently wishes to repurchase any or all of the units in such Unsold Inventory Line, then the Representative shall be entitled to set the number of units to be sold and the purchase price for such units in
its sole and absolute discretion. 
 5.14        Payment of Sales
Bonuses.  Within seven days after the six-month anniversary of the Closing Date, the Buyer shall cause the Company to pay in cash, by check or by wire transfer of immediately available funds, the Retention Bonuses in the following
manner: 
 (a)        In the event that a Retained Employee has been
continuously employed by the Company through the six-month anniversary of the Closing Date, the Buyer shall cause the applicable Retention Amount to be paid from the Payment Account to such Retained Employee, net of any required payroll withholding
obligations and, concurrently with such payment, the Buyer shall pay to the Representative for disbursement to the Sellers, 20% of each such Retention Amount paid to the Retained Employees. For the avoidance of doubt, any payment 
  

 -31- 

 from the Payment Account to the Representative pursuant to Section 5.14(a) shall be deemed to be an
adjustment to the Closing Purchase Price. 
 (b)        In the event that a
Retained Employee has not been continuously employed by the Company through the six-month anniversary of the Closing Date, the Buyer shall cause such Retained Employee’s Retention Amount to be paid from the Payment Account to the Representative
for disbursement to the Sellers. For the avoidance of doubt, any payment from the Payment Account to the Representative pursuant to Section 5.14(b) shall be deemed to be an adjustment to the Closing Purchase Price. 
 5.15        Waiver of Buy-Sell Arrangement.  Each of the Sellers and the Company
hereby: (a) waive any rights or notice requirements under that certain NMC Group, Inc. Stockholders Buy-Sell Agreement executed and accepted as of January 1, 2001 by and among the Company, Thomas V. Stephen, Douglas P. Stephen, Jr.,
Michael J. Stephen, Susan M. Stephen-Ellersick, Robert M. Stephen, Lesley Stephen, Michelle Stephen, Jacqui Stephen, Michael Ellersick and Jennifer Stephen (the “Buy-Sell Agreement”) arising in connection with this Agreement, including,
but not limited to, any rights to purchase the Purchased Shares of any other Seller and (b) agree that the Buy-Sell Agreement shall be terminated upon the consummation of the Closing. 
 ARTICLE 6 
 CONDITIONS TO CLOSING 
 6.1        Conditions Precedent to the Buyer’s Obligations.  The obligation
of the Buyer to purchase the Purchased Shares and to consummate the other transactions contemplated by this Agreement is expressly subject to the fulfillment or express written waiver of the following conditions on or prior to the Closing Date:

 (a)        Representations and Warranties True.  Each of the
representations and warranties contained in Articles 2 and 3 shall be true and correct in all material respects (other than representations and warranties which are qualified by materiality which shall be true and correct in all respects) at and as
of the Closing (except as a result of any event or circumstance contemplated, or any action or inaction required, by this Agreement or otherwise approved in writing by the Buyer, and except for any representation or warranty that expressly relates
to an earlier date, in which case such representation and warranty shall be true and correct as of such earlier date). 
 (b)        Covenants Performed.  Each Seller and the Company shall each have performed in all material respects, on or before the Closing Date, all obligations contained in this
Agreement which by the terms hereof are required to be performed by them on or before the Closing Date. 
 (c)        Compliance Certificate.  The Buyer shall have received a certificate signed by the Representative on behalf of each Seller and by the Company certifying as to the matters
set forth in Sections 6.1(a) and (b) above. 
  

 -32- 

 (d)        No Injunction,
Etc.  There shall not be any order of any court of competent jurisdiction or governmental agency restraining or invalidating the material transactions which are the subject of this Agreement. 
 (e)        HSR Act.  The waiting period under the HSR Act applicable to the
transactions contemplated by this Agreement shall have expired or been terminated. 
 (f)        Required Consents.  All of the approvals, consents and licenses listed on Schedule 6.1(f) of the Disclosure Schedule shall have been obtained. 
 (g)        Escrow Agreement.  The Sellers and the Escrow Agent shall have
executed and delivered the Escrow Agreement. 
 (h)        Share
Certificates.  The Sellers shall have delivered original stock certificates representing the Purchased Shares, together with assignments separate from such certificates executed by the applicable Seller with respect to such Purchased
Shares. 
 (i)        Resignations.  All officers and directors of
the Company shall have delivered resignations from such positions to the Buyer. 
 (j)        Lease Amendment.  The Company shall have delivered a Lease Amendment to the Buyer with respect to the Company’s principal facility in substantially the form attached
hereto as Exhibit B. 
 (k)        Royalty Agreement.  The Company
shall have executed and delivered a royalty agreement substantially in the form of Exhibit C attached hereto (the “Royalty Agreement”). 
 (l)        Section 338 Elections.  The Sellers shall have delivered to the Buyer an executed Form 8023 (and any corresponding or similar forms under state,
local or foreign law) in accordance with Section 5.7(d)(i). 
 (m)        FIRPTA Affidavit.  Each Seller shall have delivered to the Buyer a non-foreign affidavit, in form and substance reasonably satisfactory to the Buyer. 
 (n)        Related Party Indebtedness; Pay-off Letters.  The Buyer shall have
received evidence reasonably acceptable to it that all loans, advances and other indebtedness owed to or payable by the Company with respect to any of the Sellers, MJS Fastening Systems, or any Affiliate, shareholder or director of the foregoing has
been satisfied in full. The Buyer shall have received evidence that the Company has been released from its guaranty of its landlord’s mortgage. All indebtedness owed to the lender under the Credit Facility shall have been paid in full and all
Liens evidencing such indebtedness shall have been released (or in each case provided for as contemplated by Section 1.2(c)(ii) and Section 1.2(d)(i). 
 (o)        Funds Flow Statement.  The Representative and the Buyer shall have agreed upon a closing flow of funds statement, in form and
substance reasonably satisfactory to the Buyer and the Representative, with respect to the payments to be made on the Closing Date. 
  

 -33- 

 6.2        Conditions Precedent to each
Seller’s Obligations.  The obligation of each Seller to consummate the transactions contemplated by this Agreement is expressly subject to the fulfillment or express written waiver of the following conditions on or prior to the
Closing Date: 
 (a)         Representations and Warranties
True.  Each of the representations and warranties of the Buyer contained in Article 4 shall be true and correct in all material respects at and as of the Closing. 
 (b)        Obligations Performed.  The Buyer shall have performed in all
material respects, on or before the Closing Date, all obligations contained in this Agreement which by the terms hereof are required to be performed by the Buyer on or before the Closing Date. 
 (c)        Compliance Certificate.  The Representative, on behalf of the
Sellers, shall have received a certificate signed by an authorized officer of the Buyer certifying as to the matters set forth in Sections 6.2(a) and (b). 
 (d)        No Injunction, Etc.  There shall not be any order of any court of competent jurisdiction or governmental agency restraining or
invalidating the material transactions which are the subject of this Agreement. 
 (e)        Closing Payments.  The Buyer shall have made the payments contemplated by Section 1.2. 
 (f)        HSR Act.  The waiting period under the HSR Act applicable to the transactions contemplated by this Agreement shall have expired
or been terminated. 
 (g)        Escrow Agreement.  The Buyer and
the Escrow Agent shall have executed and delivered the Escrow Agreement. 
 (h)        Royalty Agreement.  The Buyer shall have executed and delivered the Royalty Agreement. 
 (i)        Lease Amendment.  The Buyer shall have delivered a Lease Amendment to the Sellers with respect to the Company’s principal
facility in substantially the form attached hereto as Exhibit B. 
 (j)        Funds Flow Statement.  The Representative and the Buyer shall have agreed upon a closing flow of funds statement, in form and substance reasonably satisfactory to the Buyer
and the Representative, with respect to the payments to be made on the Closing Date. 
 ARTICLE 7 
 SURVIVAL; INDEMNIFICATION 
 7.1        Survival.  The representations and warranties contained in this Agreement and in any certificate delivered at the Closing pursuant to this Agreement shall survive the
Closing until the eighteen-month anniversary of the Closing (the “Cut-Off Date”); provided however that representations and warranties: in (a) Sections 2.1 (Title), 3.1 (Organization, Power and 
  

 -34- 

 Standing), 3.2 (Power and Authority), 3.3 (Validity and Enforceability),
3.6 (Capitalization) and 4.9 (No Other Representations) shall survive indefinitely, (b) Sections 3.9 (Taxes), 3.19 (Benefit Plans) and 3.22 (Compliance with Environmental Laws) shall survive until the end of the
applicable statute of limitations plus thirty days (or in the event of an audit, investigation, litigation or other action that has been commenced with respect to such matters, until the conclusion of such action) and (c) Section 3.12(e)
(Intellectual Property Infringement) (the “IP Representation”) shall survive until the fifth anniversary of the Closing Date. All representations or warranties that survive for a period beyond the Cut-Off Date, other than the IP
Representation, are referred to as “Fundamental Representations.” Except with respect to the Fundamental Representations and the IP Representation, no claim for breach of any representation, warranty, pre-Closing covenant or
pre-Closing agreement may be brought after the Cut-Off Date, except for claims (a) of which the Representative has been notified in writing with reasonable specificity by the Buyer prior to the Cut-Off Date, (b) of which the Buyer has been
notified in writing with reasonable specificity by a Seller or the Representative prior to the Cut-Off Date. The post-Closing covenants and post-Closing agreements contained in this Agreement shall survive in accordance with their respective terms.

 7.2        Indemnification of the Buyer. 
 (a)        Subject to the other terms of this Article 7, from and after the Closing,
each Seller agrees to indemnify the Buyer and hold it harmless against and in respect of any and all damages, losses, expenses, costs, obligations and liabilities, including without limitation reasonable attorney’s fees (collectively,
“Losses”), (i) in an amount equal to his or her Pro Rata Share of the Losses, incurred by the Buyer that arise or result from (as determined by an order of a court of competent jurisdiction or by written agreement of the
Representative and the Buyer) (1) any breach of any of the representations or warranties contained in Article 3 (as modified by the Disclosure Schedule, (2) the failure of the Company or the Sellers to perform any of their covenants or
agreements contained herein, or (3) associated with correcting any material documentary deficiencies associated with the Company’s 401(k) employee benefit plan, and (ii) severally and not jointly, in an amount equal to the Losses
incurred by the Buyer that arise or result from (as determined by an order of a court of competent jurisdiction or by written agreement of the applicable Seller and the Buyer) any breach of any of the representations or warranties contained in
Article 2 (as modified by the Disclosure Schedule) by such Seller, it being understood, that, for the avoidance of doubt, the indemnification obligations set forth in this Section 7.2(a)(ii) for a breach of any of the representations or
warranties contained in Article 2 shall only apply to the Seller who committed such breach. 
 (b)        Each Seller’s indemnification obligations under this Agreement with regard to breaches of representations, warranties, pre-Closing covenants, and pre-Closing agreements,
however, shall be subject to the following limitations and conditions: 
 (i)        except as otherwise provided herein, no claim shall be made unless, and only to the extent that, the cumulative amount of Losses incurred by the Buyer exceeds one-half of one percent
(0.5%) of the Closing Purchase Price (the “Deductible”); 
  

 -35- 

 (ii)        the
Deductible will not apply to claims under Section 7.2(a)(i)(3) and the cumulative amount of Losses recoverable by the Buyer under Section 7.2(a)(i)(3) will be capped at a maximum of $25,000. 
 (iii)        the Sellers’ cumulative liability for indemnification
payments under Section 7.2(a)(i)(1) (other than those that may be required with respect to Fundamental Representations and the IP Representation) shall not exceed, in the aggregate, an amount equal to the Initial Escrow Amount deposited in the
Escrow Account minus any amount paid to the Buyers by the Escrow Agent in accordance with Section 1.7(e) and the Sellers’ obligation to make indemnification payments under Section 7.2(a)(i)(1) (other than those that may be
required with respect to Fundamental Representations and the IP Representation) shall be solely from the funds available in the Escrow Account; 
 (iv)        the Sellers’ cumulative liability for Losses associated with, arising from or related to any breach of the IP Representation will
be limited as follows (1) no claim for such Losses will be made unless, and only to the extent that the cumulative amounts of Losses incurred by the Buyer exceed $500,000 and any such recovery shall only be had to the extent that such Losses
exceed $500,000, (2) the aggregate cap on claims to recover such Losses will be ten percent (10%) of the Closing Purchase Price and (3) such claims will be paid by each Seller personally in accordance with its Pro Rata Share and will
not be paid from the Escrow Account. For the avoidance of doubt, the Buyer acknowledges that the Seller’s indemnity obligation with respect to the Company’s representations relating to the non-infringement of the Intellectual Property of
any other Person is limited to infringement claims based on products commercialized by the Company prior to the Closing, and that the Sellers shall have no such obligation to indemnify to the extent any infringement claim is based on any
modification to such products made subsequent to the Closing; 
 (v)        without affecting any other limitations on a Seller’s liability for indemnification set forth herein, no Seller’s cumulative liability for indemnification payments pursuant
to this Article VII shall exceed such Seller’s proceeds for the sale of his or her Purchased Shares; 
 (vi)        no claim shall be made with respect to Losses arising out of any breach of the representations or warranties contained in Article 3 as modified by the Disclosure Schedule to
the extent a corresponding reserve for such Losses has been made on the Company’s financial statements or to the extent that there has been a corresponding reduction in the calculation of Closing Working Capital; 
 (vii)        no claim shall be made for punitive, exemplary or special
damages; and 
 (viii)        no claim shall be made with
respect to any matter excluded by Section 1.7(e). 
 (c)        In
determining the foregoing thresholds and in otherwise determining the amount of any Losses for which the Buyer is entitled to assert a claim for indemnification 
  

 -36- 

 hereunder, the amount of any such Losses shall be determined after deducting therefrom the amount of any
insurance proceeds actually received (after giving effect to any applicable deductible or retention) and other third party recoveries actually received by the Buyer or the Company in respect of such Losses (which proceeds and recoveries the Buyer
agrees to use, or to cause the Company to use, commercially reasonable efforts to obtain). If an indemnification payment is received by the Buyer, and the Buyer or the Company later receives insurance proceeds or other third party recoveries in
respect of the related Losses, the Buyer shall immediately pay to the indemnifying Sellers a sum equal to the lesser of (y) the actual amount of such insurance proceeds other third party recoveries or (z) the actual amount of the
indemnification payment previously paid by such Sellers with respect to such Losses. The Buyer shall use commercially reasonable efforts to mitigate the amount of Losses for which it may be entitled to indemnification hereunder. 
 7.3        Indemnification of Sellers.  Subject to the other terms of this
Article 7, from and after the Closing, the Buyer and the Company agree to indemnify each Seller and hold each Seller harmless from all Losses incurred by any Seller that arise or result from (a) any breach of any of the Buyer’s
representations and warranties, (b) the failure of the Buyer to perform any of its covenants or agreements set forth herein or (c) the failure of the Company to perform any covenant or agreement set forth herein which by its terms is to be
performed after the Closing. 
 7.4        Procedure for Indemnification.

 (a)        Any party entitled to make a claim for indemnification
hereunder shall promptly notify the indemnifying party of the claim in writing upon learning of such claim or the facts constituting such claim, describing the claim in reasonable detail, the amount thereof, and the basis therefor. The indemnifying
party will be relieved of its indemnification obligations hereunder only to the extent that it is prejudiced by the indemnified party’s failure to give such prompt notice. The party from whom indemnification is sought shall respond to each such
claim within twenty (20) days of receipt of such notice. No action shall be taken pursuant to the provisions of this Agreement or otherwise by the party seeking indemnification (unless reasonably necessary to protect the rights of the party
seeking indemnification) until the later of (i) the expiration of the 20-day response period, or (ii) thirty (30) days following the expiration of the 20-day response period if a response, received within such 20-day period by
the party seeking indemnification, requests an opportunity to cure the matter giving rise to indemnification (and, in such event, the amount of such claim for indemnification shall be reduced to the extent so cured). 
 (b)        If a claim for indemnification hereunder is based on a claim by a third party,
the indemnifying party shall have the right to assume the entire control of the defense thereof, including at its own expense, employment of counsel reasonably satisfactory to the indemnified party, and, in connection therewith, the party claiming
indemnification shall reasonably cooperate with the indemnifying party and make available to the indemnifying party all pertinent requested information under its control; provided, that the indemnified party may participate in any proceeding
with counsel of its choice at its own expense. In such event, the indemnifying party shall have the right to settle or resolve any such claim by a third party; provided, that any such settlement or resolution contemplated by the Sellers or
the Representative, as the indemnifying party, that involves any action by the Buyer other than the 
  

 -37- 

 payment of an amount of money that is less than the remaining Escrow Amount shall not be concluded
without the prior written approval of the Buyer, unless such approval is unreasonably withheld, delayed or conditioned; and, provided further, that any such settlement or resolution contemplated by the Buyer, as the indemnifying party, that
involves any action by the Sellers other than the payment of money shall not be concluded without the prior written approval of each of the indemnified Sellers, which approval shall not be unreasonably withheld, delayed or conditioned. Without
limiting the generality of the foregoing, the Buyer will, and the Buyer will cause the employees of the Buyer and the Company to, cooperate fully with the Representative and each Seller in connection with any matter for which any Seller is the
indemnifying party. Such cooperation shall include, without limitation, (i) assisting in the collection and preparation of discovery materials, (ii) meeting with (and making employees available to meet with) the indemnifying Sellers and/or
their counsel to prepare for and/or appear as witnesses at depositions, court proceedings and/or trial, and (iii) providing to the indemnifying Sellers and/or their counsel all information under the control of the Buyer or the Company that is
deemed necessary by the indemnifying Sellers and/or their counsel for the defense or prosecution of such matter. Sellers will reimburse Buyer for its reasonable out of pocket expenses incurred with respect to Buyer’s cooperation pursuant to
this Section 7.4(b). 
 (c)        (i) Notwithstanding the
foregoing, if (A) the indemnifying party does not give written notice to the indemnified party within the period specified in Section 7.4(a) stating that the indemnifying party has elected to assume defense of such third-party claim,
(B) at any time the indemnifying party shall fail to carry out such defense or handling diligently and in such manner as is reasonable under the circumstances, (C) the third-party claim involves such matters as in the good faith judgment
of the Buyer may result in a material adverse impact on the business, obligations, assets, liabilities (absolute, accrued, contingent or otherwise), condition (financial or otherwise), material customer or supplier relationships or prospects of the
Buyer or its Affiliates or (D) the indemnified party has reasonably determined, upon advice of counsel, that having common counsel with the indemnifying party would present such counsel with a conflict of interest or that, upon advice of
counsel, there may be legal defenses available to such indemnified party which are different from or in addition to those available to the indemnifying party, then the provisions of Section 7.4(c)(ii) below shall govern. 
 (ii)        The indemnified party may, at the indemnifying party’s expense, select counsel
reasonably satisfactory to the indemnifying party to defend or handle such third-party claim in a manner that is reasonable under the circumstances; provided, however, that the indemnified party shall keep the indemnifying party timely apprised of
the status of such third-party claim. The indemnified party shall not settle such third-party claim without the prior written consent of the indemnifying party (which consent shall not be unreasonably withheld, conditioned or delayed). If the
indemnified party defends or handles such third-party claim, the indemnifying party shall cooperate with the indemnified party and shall be entitled to participate in the defense of handling of such third-party claim with its own counsel and at the
indemnifying party’s expense. In addition, in the event that the indemnifying party is not permitted to assume the defense of the third-party claim solely by virtue of clause (D) of subparagraph (c)(i) above, then the indemnifying
party shall be permitted to pursue, at its own expense, settlement discussions directly with any other parties involved in such third-party claim. Notwithstanding the preceding sentence, the indemnifying party shall not, without the prior written
consent of the indemnified party agree to a settlement of any third-party claim, unless (A) the settlement is for monetary 
  

 -38- 

 damages only for amounts which the Sellers agree to pay, and with respect to claims by any indemnified
party provides an unconditional release and discharge of the indemnified parties, and the indemnified party has no reasonable good faith objection to the form or substance of such discharge and release and (B) the indemnified party shall not
have reasonably objected to any such settlement on the grounds that the circumstances surrounding the settlement could adversely impact the business, operations, assets, liabilities (absolute, accrued, contingent or otherwise), condition, financial
or otherwise, material or customer or supplier relationships of the Buyer or its Affiliates or could establish or contribute to a precedential customer practice which could have a material adverse effect on the continuing business interest of the
Buyer or its Affiliates. 
 7.5        Remedies Exclusive.  The
remedies provided in this Article 7 shall be the exclusive remedies of the parties hereto and their heirs, successors, and assigns after the Closing with respect to this Agreement and the transactions contemplated by this Agreement, including
without limitation any breach or non-performance of any representation, warranty, covenant or agreement contained herein, except in the case of actual fraud, in which case the defrauded party shall have all rights and remedies available under this
Agreement and available under the law against the party that committed such actual fraud. No party may bring or commence any claim, suit, action or proceeding with respect to this Agreement or the transactions contemplated hereby, whether in
contract, tort or otherwise, except to (a) bring a claim for actual fraud against the party that committed such fraud and (b) enforce such party’s express rights under this Agreement. The provisions of this Article 7 constitute
an integral part of the consideration given pursuant to this Agreement and were specifically bargained for and reflected in the total amount of the Closing Purchase Price payable to the Sellers. 
 7.6        Tax Treatment of Indemnity Payments.  To the maximum extent permitted
by law, it is the intention of the parties to treat any indemnity payment made under this Agreement as an adjustment to the purchase price for all federal, state, local and foreign Tax purposes, and the parties agree to file their Tax Returns
accordingly. 
 ARTICLE 8 
 TERMINATION 
 8.1        Termination.  Notwithstanding anything contained in this Agreement to the contrary, this Agreement may be terminated at any time prior to the Closing: 
 (a)        by mutual written consent of the Representative and the Buyer; 
 (b)        by the Buyer, if (i) any of the representations and warranties of the
Sellers or the Company set forth in this Agreement shall not be true and correct to the extent set forth in Section 6.1(a), or any Seller shall have breached or failed to perform any of its obligations, covenants or agreements under this
Agreement to the extent set forth in Section 6.1(b), and (ii) such breach, failure or misrepresentation is not cured within fifteen (15) days after the Buyer gives the Sellers and the Company written notice identifying in
reasonably detail such breach, failure or misrepresentation; 
  

 -39- 

 (c)        by the Representative, if
(i) any of the representations and warranties of the Buyer set forth in this Agreement shall not be true and correct to the extent set forth in Section 6.2(a), or if the Buyer shall have breached or failed to perform any of its
obligations, covenants or agreements under this Agreement to the extent set forth in Section 6.2(b), and (ii) such breach, failure or misrepresentation is not cured within fifteen (15) days after the Sellers give the Buyer
written notice identifying in reasonable detail such breach, failure or misrepresentation; 
 (d)        by either the Sellers or the Buyer, if any court or governmental authority has issued a final and non-appealable order, decree or ruling permanently restraining, enjoining or
otherwise prohibiting the consummation of the sale and purchase of the Purchased Shares contemplated by this Agreement; or 
 (e)        by either the Representative or the Buyer, if the Closing has not occurred by January 31, 2009 or such other date, if any, as the Representative and the Buyer may agree in
writing; provided, that the right to terminate this Agreement under this Section 8.1(e) shall not be available to the party whose willful and knowing failure to fulfill any obligation under this Agreement has contributed materially
to the failure of the Closing to occur on or before such date. 
 8.2        Effect of Termination. 
 (a)        If this Agreement is terminated as provided above, the parties shall have no further obligations hereunder (including, without limitation, for costs and expenses incurred by other
parties in connection with this Agreement and the transactions contemplated hereby), except as provided below and except that each party shall be liable for its breach of this Agreement and the other parties hereto shall be entitled to all rights
and remedies provided by law in respect of such breach. 
 (b)        The
obligations of the Buyer under Section 5.1(b) shall survive the termination of this Agreement. 
 ARTICLE 9 
 MISCELLANEOUS 
 9.1        Notices.  Any notices, demands and communications to a party hereunder shall be in writing and shall be deemed to have been duly given and received (a) if delivered
personally or actually received, as of the date received, (b) if delivered by certified mail, return receipt requested, two (2) business days after being mailed, (c) if delivered by a nationally recognized overnight delivery
service, one (1) business day after being sent to such delivery service, or (d) if sent via facsimile, electronic mail or similar electronic transmission, as of the date received, to such party at its address set forth below (or
such other address as it may from time to time designate in writing to the other parties hereto): 
 If to the Sellers, the
Representative or the Company prior to the Closing, to: 
 NMC Group, Inc. 
 2755 Thompson Creek Road 
  

 -40- 

 Pomona, CA 91767 
 Attn: Mr. Robert M. Stephen 
 Facsimile: (909) 593-8309 
 with a copy (which shall not constitute notice) to: 
 Paul, Hastings, Janofsky & Walker LLP 
 515 South Flower Street 
 Los Angeles, California 90071 
 Attn: Robert
A. Miller, Jr., Esq. 
 Facsimile: (213) 627-0705 
 If to the Sellers or the Representative after the Closing, to: 
 Robert M. Stephen

 16912 Marina Bay Drive 
 Huntington Beach, CA 92649 
 Facsimile: (562) 592-7856 
 with a copy (which shall not constitute notice) to: 
 Paul, Hastings, Janofsky & Walker LLP 
 515 South Flower Street 
 Los Angeles, California 90071 
 Attn: Robert
A. Miller, Jr., Esq. 
 Facsimile: (213) 627-0705 
 If to the Buyer or, after the Closing, the Company, to: 
 Esterline Technologies
Corporation 
 500 108th Avenue NE, Suite 1500 
 Bellevue, WA 98004 
 Attn: Stephen R. Larson 
 Facsimile: (425) 453-2916 
 with a copy (which shall not constitute notice) to: 
 Perkins Coie LLP 
 1201 Third Avenue, 48th Floor 
 Seattle, WA
98101 
 Attn: Troy Hickman 
 Facsimile: (206) 359-7356 
 9.2        No Waiver.  No
failure of any party to exercise and no delay in exercising any right, power or remedy hereunder shall operate as a waiver thereof; nor shall any single or partial exercise of any right, power or remedy hereunder preclude any other or further
exercise thereof or the exercise of any other right, power or remedy hereunder. 
  

 -41- 

 9.3        Amendments and
Waivers.  This Agreement may be modified, amended or waived only by a writing signed by the party against whom enforcement thereof is sought. 
 9.4        Choice of Law; Forum.  This Agreement shall be governed by and construed in accordance with the internal laws of the State of
California, without regard to the choice of law provisions thereof. Any proceeding arising out of or relating to this Agreement shall be brought in the courts of the State of California, County of Los Angeles, or, if it has or can acquire
jurisdiction, in the United States District Court for the Central District of California. This provision may be filed with any court as written evidence of the knowing and voluntary irrevocable agreement between the parties to waive any objections
to jurisdiction, venue or convenience of forum. EACH PARTY HERETO ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH MAY ARISE UNDER THIS AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES, AND THEREFORE IT HEREBY IRREVOCABLY AND
UNCONDITIONALLY WAIVES ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT AND ANY OF THE AGREEMENTS DELIVERED IN CONNECTION HEREWITH OR THE TRANSACTIONS
CONTEMPLATED HEREBY OR THEREBY. 
 9.5        Binding Effect and
Benefits.  This Agreement shall be binding upon and shall inure to the benefit of the parties and their respective heirs, successors and assigns, but may not be assigned by any party without the prior written consent of the
Representative in the case of a purported assignment by the Buyer, or by the Buyer in the case of a purported assignment by any Seller. 
 9.6        Integration; Schedules.  This writing, the annexes, exhibits and schedules attached hereto and the Disclosure Schedule, embody the entire agreement
and understanding among the parties with respect to this transaction and supersede all prior discussions, understandings and agreements concerning the matters covered hereby, except as set forth in Section 5.1(b). Information set forth on the
Disclosure Schedule shall be deemed to qualify each section of this Agreement to which such information is applicable (regardless of whether or not such other section is qualified by reference to the Disclosure Schedule), so long as application to
such section is reasonably discernible from the reading of such disclosure. No information set forth on any schedule to the Disclosure Schedule shall be deemed to broaden in any way the scope of any Seller’s or the Company’s
representations and warranties. The inclusion of an item on any schedule to the Disclosure Schedule is not evidence of the materiality of such item for purposes of this Agreement or otherwise, or that such item is a disclosure required under the
Agreement. No disclosure in any schedule to the Disclosure Schedule relating to any possible breach or violation of any agreement, Authorization or Legal Requirement shall be construed as an admission or indication that any such breach or violation
exists or has actually occurred, or shall constitute an admission of liability to any third party. 
 9.7        Counterparts.  This Agreement may be executed in two or more counterparts, and with counterpart signature pages, each of which shall be an original, but all of which
together shall constitute one and the same Agreement, binding on all of the parties hereto notwithstanding that all such parties have not signed the same counterpart. Counterpart signature pages to this Agreement transmitted by facsimile
transmission, by electronic mail in 
  

 -42- 

 “portable document format” (“.pdf”) form, or by any other electronic means intended
to preserve the original graphic and pictorial appearance of a document, will have the same effect as physical delivery of the paper document bearing an original signature. 
 9.8        Limitation on Scope of Agreement.  If any provision of this Agreement is unenforceable or illegal, such provision shall be
enforced to the fullest extent permitted by law and the remainder of the Agreement shall remain in full force and effect. 
 9.9        Sellers’ Representative. 
 (a)        Each Seller hereby appoints Robert M. Stephen as his or her representative (the “Representative”), to be his or her true and lawful attorney-in-fact for all matters
in connection with this Agreement, including without limitation, the compromise of any disputes between the Buyer and any Seller relating to the transactions contemplated by this Agreement and to take any other action contemplated to be taken by the
Representative hereof. The power of attorney granted to the Representative appointed hereunder is coupled with an interest and will continue in full force and effect notwithstanding the subsequent death or incapacity of a Seller. The Representative
appointed hereunder will have the power to act on behalf of the Sellers with respect to all matters requiring action by the Sellers under this Agreement, including, without limitation, the execution and delivery of any documents contemplated hereby.
Robert M. Stephen hereby accepts such appointment. In the event of the death, or the incapacity to serve or resignation as the Representative by Robert M. Stephen, a successor Representative will promptly be appointed by the Sellers constituting the
former holders of a majority of the Purchased Shares and the Sellers will jointly notify the Buyer of such appointment. The Buyer will be entitled to rely on any communication received from the Representative or his successor without investigation.

 (b)        The Representative shall not be liable to the Sellers for any
act taken or omitted by him as permitted under this Agreement and the transactions contemplated hereby, except if such act is taken or omitted in bad faith or by willful misconduct. The Representative shall also be fully protected against the
Sellers in relying upon any written notice, demand, certificate or document that he in good faith believes to be genuine. 
 (c)        The Sellers agree, severally but not jointly, to indemnify the Representative for, and to hold the Representative harmless against Losses, in an amount equal to his or her Pro Rata
Share of the Losses, incurred without willful misconduct or bad faith on the part of the Representative, arising out of or in connection with the Representative’s carrying out its duties under this Agreement and the transactions contemplated
hereby, including costs and expenses of successfully defending the Representative against any claim of liability with respect thereto. The Representative may consult with counsel of its own choice and will have full and complete authorization and
protection for any action taken and suffered by it in good faith and in accordance with the opinion of such counsel. 
 9.10        Headings.  The headings of Articles and Sections herein are inserted for convenience of reference only and shall be ignored in the construction or interpretation
hereof. 
  

 -43- 

 9.11        Expenses.  All legal
and other costs and expenses incurred in connection with this Agreement and the transactions contemplated hereby shall be paid by the party incurring such costs and expenses, except as otherwise expressly provided herein. 
 9.12        No Third Party Beneficiaries.  Except as otherwise expressly set
forth in this Agreement, including Section 5.8 hereof, nothing in this Agreement will be construed as giving any third party, any right, remedy or claim under or in respect of this Agreement or any provision hereof. No employee of the Company
shall be a third-party beneficiary or entitled to rely on Section 5.10. 
 9.13    Further
Assurances.  Following the Closing, the parties shall execute and deliver to each other such documents and take such other actions as may reasonably be requested in order to consummate more effectively the transactions contemplated
hereby. 
 9.14        “Knowledge” Defined.  As used
herein, “to the knowledge of the Company,” “to the Company’s knowledge” or any other similar phrase shall mean the actual knowledge of Robert M. Stephen, Mark Balderraama, Tom Mendez, Doug Stephen and Stephen Williams.

 9.15        Publicity.  Pending the Closing, no party shall issue
a press release or make any other public announcement concerning the transactions contemplated by this Agreement without the prior written consent of the Representative and the Buyer, except to the extent required by law, in which case the other
parties hereto shall have the opportunity to review and comment prior to disclosure. 
 9.16        No Strict Construction.  The parties hereto have participated jointly in the negotiation and drafting of this Agreement and the other agreements and documents contemplated
herein. In the event an ambiguity or question of intent or interpretation arises under any provision of this Agreement or any other agreement or documents contemplated herein, this Agreement and such other agreements or documents shall be construed
as if drafted jointly by the parties thereto, and no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of authoring any of the provisions of this Agreement or any other agreements or documents contemplated
herein. 
 ARTICLE 10 
 DEFINITIONS 
 The following terms, as used in this Agreement, have the meanings given to them in the section
or place indicated below: 
  

			
	 Term:
	  	 Section or Place
 Where Defined:

		
	 Affiliate
	  	Section 3.23
	 Agreement
	  	Preamble
	 Authorizations
	  	Section 3.16
	 Balance Sheet
	  	Section 3.7
	 Balance Sheet Date
	  	Section 3.7
	 Benefit Plans
	  	Section 3.19

  

 -44- 

			
	 Term:
	  	 Section or Place
 Where Defined:

		
	 Buyer
	  	Preamble
	 Closing
	  	Section 1.4
	 Closing Cash
	  	Section 1.2
	 Closing Date
	  	Section 1.4
	 Closing Indebtedness
	  	Section 1.2
	 Closing Purchase Price
	  	Section 1.2
	 Closing Purchase Price Certificate
	  	Section 1.7
	 Closing Working Capital
	  	Section 1.2
	 Code
	  	Section 3.9
	 Company
	  	Preamble
	 Company Charter Documents
	  	Section 3.1
	 Company Contacts
	  	Section 5.11
	 Company Intellectual Property
	  	Section 3.12
	 Company Material Adverse Effect
	  	Section 3.5
	 Confidential Agreement
	  	Section 5.1
	 Credit Facility
	  	Section 1.2
	 Cut-Off Date
	  	Section 7.1
	 Debt Amount
	  	Section 1.2
	 Deductible
	  	Section 7.2
	 Disclosure Schedule
	  	Article 2
	 Disputed Items
	  	Section 1.7
	 Disputed Items Notice
	  	Section 1.7
	 Environment
	  	Section 3.22
	 Environmental Claim
	  	Section 3.22
	 Environmental Laws
	  	Section 3.22
	 ERISA
	  	Section 3.19
	 Escrow Account
	  	Section 1.2
	 Escrow Agent
	  	Section 1.2
	 Escrow Agreement
	  	Section 1.2
	 Escrow Amount
	  	Section 1.2
	 Estimated Closing Purchase Price
	  	Section 1.2
	 Estimated Closing Purchase Price Certificate
	  	Section 1.2
	 Fundamental Representations
	  	Section 7.1
	 GAAP
	  	Section 1.2
	 HSR Act
	  	Section 5.5
	 Hazardous Substances
	  	Section 3.22
	 Indemnified Persons
	  	Section 5.9
	 Independent Accountant
	  	Section 1.7
	 Initial Escrow Amount
	  	Section 1.2
	 Intellectual Property
	  	Section 3.12
	 Inventory Notice
	  	Section 5.13
	 IP Representation
	  	Section 7.1
	 IRS
	  	Section 3.19

  

 -45- 

			
	 Term:
	  	 Section or Place
 Where Defined:

		
	 Key Employees
	  	Section 5.11
	 Knowledge
	  	Section 9.14
	 Legal Requirements
	  	Section 3.17
	 License Agreement
	  	Section 6.1
	 Liens
	  	Section 1.2
	 Losses
	  	Section 7.2
	 Major Customer
	  	Section 3.24
	 Major Supplier
	  	Section 3.24
	 Material Contract
	  	Section 3.13
	 Parties
	  	Section 5.7
	 Payment Account
	  	Section 1.2
	 Permitted Liens
	  	Section 3.10
	 Pre-Closing Taxes
	  	Section 3.9
	 Pre-Closing Tax Period
	  	Section 3.9
	 Proceeding
	  	Section 5.9
	 Pro Rata Share
	  	Section 2.1
	 Purchased Shares
	  	Introduction
	 Representative
	  	Section 9.9
	 Restricted Activities
	  	Section 5.11
	 Restricted Period
	  	Section 5.11
	 Retained Employee
	  	Section 1.2
	 Retention Amount
	  	Section 1.2
	 Retention Bonuses
	  	Section 1.2
	 Sale Bonuses
	  	Section 1.2
	 Section 338 Elections
	  	Section 5.8
	 Section 338 Forms
	  	Section 5.8
	 Securities Act
	  	Section 4.6
	 Seller
	  	Preamble
	 Sellers
	  	Preamble
	 Seller’s Expenses
	  	Section 1.2
	 Standard Cost
	  	Section 5.13
	 Straddle Period
	  	Section 3.9
	 Target Working Capital
	  	Section 1.2
	 Target Working Capital Ceiling
	  	Section 1.2
	 Target Working Capital Floor
	  	Section 1.2
	 Tax or Taxes
	  	Section 3.9
	 Tax Matter
	  	Section 5.7
	 Tax Returns
	  	Section 3.9
	 Unsold Inventory Line
	  	Section 5.13

  

 -46- 

 IN WITNESS WHEREOF, the undersigned have caused this Agreement to be executed as of the
date first above written. 
  

			
	NMC GROUP, INC.
		
	 By:
	 	 /s/    Robert M. Stephen

			
		
	 Name:
	 	 Robert M. Stephen

					
			
		 	 Title:
	 	 President

  

	
	SELLERS:
	
	 /s/    Douglas P. Stephen

	 Douglas P. Stephen, Co-Trustee of The
 Stephen Family Trust

	
	 /s/    Barbara M. Stephen

	 Barbara M. Stephen, Co-Trustee of The
 Stephen Family Trust

	
	 /s/    Douglas P. Stephen, Jr.

	 Douglas P. Stephen, Jr.

	
	 /s/    Robert M. Stephen

	 Robert M. Stephen

	
	 /s/    Michael J. Stephen

	 Michael J. Stephen

	
	 /s/    Susan M. Stephen Ellersick

	 Susan M. Stephen Ellersick

	
	 /s/    Thomas V. Stephen

	 Thomas V. Stephen

 [Signature Page to the Stock Purchase Agreement] 

			
	 ESTERLINE TECHNOLOGIES
 CORPORATION

		
	 By:
	 	 /s/    Robert W. Cremin

			
		
	 Name:
	 	 Robert W. Cremin

			
		
	 Title:
	 	 Chairman, Pres & CEO

 [Signature Page to the Stock Purchase Agreement] 

 ANNEX I 
 SHAREHOLDERS 
  

							
	Shareholder	 	 Shares of Series A
 Voting Common
 Stock
	 	 Shares of Series B
 Non-Voting
 Common Stock
	 	 Pro Rata Share
of
 Outstanding Shares

	Douglas P. Stephen
and Barbara M.
Stephen, Co-Trustees
of the Stephen
Family
Trust	 	1,250	 	0	 	25%
	Douglas P. Stephen,
Jr.	 	250	 	500	 	15%
	 Robert M. Stephen

  
	 	250	 	500	 	15%
	 Michael J. Stephen

  
	 	250	 	500	 	15%
	Susan M. Stephen
Ellersick	 	250	 	500	 	15%
	 Thomas V. Stephen

  
	 	250	 	500	 	15%

 EXHIBIT A 
 ESCROW AGREEMENT 

 EXHIBIT B 
 LEASE AMENDMENT 

 EXHIBIT C 
 ROYALTY AGREEMENT 

 Schedule 1.2(a)(i) 
 Excluded Accounts for Closing Working Capital 
 2330-000-10-00        Accrued Distributions – The purpose of this account is to accrue future distributions to the Company’s shareholders. 
 2339-000-10-00        Accrued Calif Income Tax – The purpose of this account is to accrue future tax
payments to the California State Board of Equalization. 
 2374-000-10-00        Accrued Interest
– The purpose of this account is to accrue future interest payments to debt holders of the Company. 
 2393-000-10-00        Short Term Portion of Notes Payable DPS – The purpose of this account was to account for the short term portion of a long term loan pursuant to an agreement with Douglas P.
Stephen. 
 2394-000-10-00        Short Term Portion of Notes Payable – The purpose of this
account was to account for the short term portion of a long term loan pursuant to an agreement with Community Bank to finance equipment. 
 2395-000-10-00        Community Bank W/C Line – The purpose of this account is to account for the Company’s line of credit with Community Bank. 
 2395-001-10-00        Do Not Use LOC Community Bank Temp – The purpose of this account is the same as
2395-000-10-00 listed above. This account is used only if the Company transfers its account from Community Bank to another bank. 

 Schedule 1.2(a)(ii) 
 Target Working Capital Statement

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00151-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00151-of-00352.parquet"}]]