Document:

exv10w1

 

Exhibit 10.1

ASSET PURCHASE AGREEMENT

by and among

LAM RESEARCH CORPORATION,

BULLEN ULTRASONICS, INC.,

EATON 122 LTD.,

BULLEN SEMICONDUCTOR (SUZHOU) CO., LTD.,

MARY A. BULLEN,

and

VICKI A. BROWN

Dated: October 5, 2006

THE
SYMBOL [***] IS USED TO INDICATE THAT A PORTION OF THE EXHIBIT HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTION.

SCHEDULES TO THIS AGREEMENT ARE OMITTED FROM THIS FILING. LAM RESEARCH CORPORATION UNDERTAKES TO
PROVIDE COPIES OF THE OMITTED SCHEDULES TO THE SECURITIES AND EXCHANGE COMMISSION UPON REQUEST
OF THE COMMISSION.

 

 

EXECUTION VERSION

Table of Contents

	 	 	 	 	 
	1. Definitions and Usage
	 	 	2	 
	1.1 DEFINITIONS
	 	 	2	 
	1.2 USAGE
	 	 	14	 
	2. Sale and Transfer of Assets; Closing
	 	 	15	 
	2.1 ASSETS TO BE SOLD
	 	 	15	 
	2.2 EXCLUDED ASSETS
	 	 	17	 
	2.3 CONSIDERATION
	 	 	17	 
	2.4 LIABILITIES
	 	 	18	 
	2.5 ALLOCATION
	 	 	20	 
	2.6 CLOSING
	 	 	20	 
	2.7 CLOSING OBLIGATIONS
	 	 	21	 
	2.8 ADJUSTMENT AMOUNT AND PAYMENT
	 	 	24	 
	2.9 ADJUSTMENT PROCEDURE
	 	 	25	 
	2.10 CONSENTS
	 	 	26	 
	3. Representations and Warranties of Seller and Shareholders
	 	 	28	 
	3.1 ORGANIZATION AND GOOD STANDING
	 	 	28	 
	3.2 ENFORCEABILITY; AUTHORITY; NO CONFLICT
	 	 	29	 
	3.3 CAPITALIZATION
	 	 	30	 
	3.4 FINANCIAL STATEMENTS
	 	 	30	 
	3.5 BOOKS AND RECORDS
	 	 	31	 
	3.6 SUFFICIENCY OF ASSETS
	 	 	31	 
	3.7 DESCRIPTION OF OWNED REAL PROPERTY
	 	 	32	 
	3.8 DESCRIPTION OF LEASED REAL PROPERTY
	 	 	32	 
	3.9 TITLE TO ASSETS; ENCUMBRANCES
	 	 	32	 
	3.10 CONDITION OF FACILITIES
	 	 	33	 
	3.11 ACCOUNTS RECEIVABLE; CUSTOMER REVENUES
	 	 	34	 
	3.12 INVENTORIES
	 	 	34	 
	3.13 NO UNDISCLOSED LIABILITIES
	 	 	35	 
	3.14 TAXES
	 	 	35	 
	3.15 NO MATERIAL ADVERSE CHANGE
	 	 	37	 
	3.16 EMPLOYEE BENEFITS
	 	 	37	 
	3.17 COMPLIANCE WITH LEGAL REQUIREMENTS; GOVERNMENTAL AUTHORIZATIONS
	 	 	39	 
	3.18 LEGAL PROCEEDINGS; ORDERS
	 	 	40	 
	3.19 ABSENCE OF CERTAIN CHANGES AND EVENTS
	 	 	41	 
	3.20 CONTRACTS; NO DEFAULTS
	 	 	42	 
	3.21 INSURANCE
	 	 	45	 
	3.22 ENVIRONMENTAL MATTERS
	 	 	46	 
	3.23 EMPLOYEES
	 	 	48	 
	3.24 LABOR DISPUTES; COMPLIANCE
	 	 	49	 
	3.25 INTELLECTUAL PROPERTY ASSETS
	 	 	49	 
	3.26 COMPLIANCE WITH THE FOREIGN CORRUPT PRACTICES ACT AND EXPORT CONTROL AND ANTIBOYCOTT LAWS
	 	 	53	 
	3.27 RELATIONSHIPS WITH RELATED PERSONS
	 	 	54	 

- i -

 

EXECUTION VERSION

	 	 	 	 	 
	3.28 BROKERS OR FINDERS
	 	 	55	 
	3.29 SOLVENCY
	 	 	55	 
	3.30 DISCLOSURE
	 	 	55	 
	4. Representations and Warranties of Buyer
	 	 	56	 
	4.1 ORGANIZATION AND GOOD STANDING
	 	 	56	 
	4.2 AUTHORITY; NO CONFLICT
	 	 	56	 
	4.3 [Intentionally left blank]
	 	 	56	 
	4.4 BROKERS OR FINDERS
	 	 	56	 
	5. Covenants of Seller Prior to Closing
	 	 	57	 
	5.1 ACCESS AND INVESTIGATION
	 	 	57	 
	5.2 OPERATION OF THE BUSINESS OF SELLER
	 	 	57	 
	5.3 NEGATIVE COVENANT
	 	 	58	 
	5.4 REQUIRED APPROVALS
	 	 	59	 
	5.5 NOTIFICATION
	 	 	59	 
	5.6 NO NEGOTIATION
	 	 	59	 
	5.7 BEST EFFORTS
	 	 	60	 
	5.8 INTERIM FINANCIAL STATEMENTS
	 	 	60	 
	5.9 PAYMENT OF LIABILITIES
	 	 	60	 
	5.10 HART SCOTT RODINO
	 	 	60	 
	5.11 CURRENT EVIDENCE OF TITLE
	 	 	60	 
	5.12 [***]
	 	 	60	 
	5.13 USE OF BULLEN NAME
	 	 	60	 
	6. Covenants of Buyer Prior to Closing
	 	 	61	 
	6.1 REQUIRED APPROVALS
	 	 	61	 
	6.2 HART SCOTT RODINO
	 	 	62	 
	6.3 COOPERATION REGARDING [***].
	 	 	62	 
	7. Conditions Precedent to Buyer’s Obligation to Close
	 	 	62	 
	7.1 ACCURACY OF REPRESENTATIONS
	 	 	62	 
	7.2 SELLER PARTIES’ PERFORMANCE
	 	 	62	 
	7.3 CONSENTS
	 	 	63	 
	7.4 ADDITIONAL DOCUMENTS
	 	 	63	 
	7.5 NO PROCEEDINGS
	 	 	64	 
	7.6 [Intentionally Omitted]
	 	 	64	 
	7.7 TITLE INSURANCE
	 	 	64	 
	7.8 SURVEY
	 	 	64	 
	7.9 ZONING
	 	 	64	 
	7.10 GOVERNMENTAL AUTHORIZATIONS
	 	 	65	 
	7.11 ENVIRONMENTAL REPORT
	 	 	65	 
	7.12 EMPLOYEES
	 	 	65	 
	7.13 NONCOMPETITION AGREEMENTS
	 	 	65	 
	7.14 NO INJUNCTION
	 	 	65	 
	7.15 [SUZHOU CHINA CONDITIONS]
	 	 	65	 
	7.16 MATERIAL ADVERSE CHANGE
	 	 	66	 
	7.17 PRODUCTION CERTIFICATION
	 	 	66	 
	7.18 HART SCOTT RODINO WAITING PERIOD
	 	 	66	 
	8. Conditions Precedent to Seller Parties’ Obligation to Close
	 	 	66	 

THE SYMBOL [***] IS USED TO INDICATE THAT A PORTION OF THE EXHIBIT HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE
OMITTED PORTION.

 ii

 

EXECUTION VERSION

	 	 	 	 	 
	8.1 ACCURACY OF REPRESENTATIONS
	 	 	66	 
	8.2 BUYER’S PERFORMANCE
	 	 	67	 
	8.3 CONSENTS
	 	 	67	 
	8.4 ADDITIONAL DOCUMENTS
	 	 	67	 
	8.5 NO INJUNCTION
	 	 	67	 
	8.6 NO PROCEEDINGS
	 	 	67	 
	8.7 [Intentionally Omitted]
	 	 	67	 
	8.8 HART SCOTT RODINO WAITING PERIOD
	 	 	67	 
	9. Termination
	 	 	68	 
	9.1 TERMINATION EVENTS
	 	 	68	 
	9.2 EFFECT OF TERMINATION
	 	 	68	 
	10. Additional Covenants
	 	 	69	 
	10.1 EMPLOYEES AND EMPLOYEE BENEFITS
	 	 	69	 
	10.2 PAYMENT OF ALL TAXES RESULTING FROM SALE OF ASSETS BY SELLER
	 	 	71	 
	10.3 PAYMENT OF OTHER RETAINED LIABILITIES
	 	 	71	 
	10.4 RESTRICTION ON COMPANY DISTRIBUTIONS
	 	 	71	 
	10.5 RESTRICTIONS ON CHANGE IN CONTROL AND DISSOLUTION OF COMPANY
	 	 	71	 
	10.6 REMOVING EXCLUDED ASSETS
	 	 	72	 
	10.7 REPORTS AND RETURNS
	 	 	72	 
	10.8 ASSISTANCE IN PROCEEDINGS
	 	 	72	 
	10.9 CUSTOMER AND OTHER BUSINESS RELATIONSHIPS
	 	 	73	 
	10.10 RETENTION OF AND ACCESS TO RECORDS
	 	 	73	 
	10.11 PRODUCTION REPORTS
	 	 	73	 
	10.12 FURTHER ASSURANCES
	 	 	73	 
	11. Indemnification; Remedies
	 	 	74	 
	11.1 SURVIVAL
	 	 	74	 
	11.2 INDEMNIFICATION AND REIMBURSEMENT BY SELLER PARTIES
	 	 	75	 
	11.3 [Intentionally Omitted].
	 	 	75	 
	11.4 INDEMNIFICATION AND REIMBURSEMENT BY BUYER
	 	 	75	 
	11.5 LIMITATIONS ON AMOUNT—SELLER PARTIES
	 	 	76	 
	11.6  [Intentionally Omitted]
	 	 	78	 
	11.7 THIRD-PARTY CLAIMS
	 	 	78	 
	11.8 INDEMNIFICATION PAYMENT
	 	 	78	 
	11.9 [Intentionally Omitted].
	 	 	78	 
	12. Confidentiality
	 	 	79	 
	12.1 DEFINITION OF CONFIDENTIAL INFORMATION
	 	 	79	 
	12.2 RESTRICTED USE OF CONFIDENTIAL INFORMATION
	 	 	79	 
	12.3 EXCEPTIONS
	 	 	80	 
	12.4 LEGAL PROCEEDINGS
	 	 	80	 
	12.5 RETURN OR DESTRUCTION OF CONFIDENTIAL INFORMATION
	 	 	81	 
	12.6 [Intentionally Omitted]
	 	 	81	 
	13. General Provisions
	 	 	81	 
	13.1 EXPENSES
	 	 	81	 
	13.2 PUBLIC ANNOUNCEMENTS
	 	 	81	 

iii

 

EXECUTION VERSION

	 	 	 	 	 
	13.3 NOTICES
	 	 	82	 
	13.4 [INTENTIONALLY LEFT BLANK]
	 	 	83	 
	13.5 ENFORCEMENT OF AGREEMENT
	 	 	83	 
	13.6 WAIVER; REMEDIES CUMULATIVE
	 	 	83	 
	13.7 ENTIRE AGREEMENT AND MODIFICATION
	 	 	84	 
	13.8 DISCLOSURE SCHEDULE
	 	 	84	 
	13.9 ASSIGNMENTS, SUCCESSORS AND NO THIRD-PARTY RIGHTS
	 	 	84	 
	13.10 SEVERABILITY
	 	 	84	 
	13.11 CONSTRUCTION
	 	 	84	 
	13.12 TIME OF ESSENCE
	 	 	85	 
	13.13 GOVERNING LAW
	 	 	85	 
	13.14 EXECUTION OF AGREEMENT
	 	 	85	 
	13.15 SHAREHOLDER OBLIGATIONS
	 	 	85	 
	13.16 REPRESENTATIVE OF SELLER AND SHAREHOLDERS
	 	 	85	 
	13.17 CASUALTY AND CONDEMNATION
	 	 	86	 
	13.18 PRORATIONS
	 	 	87	 

iv

 

EXECUTION VERSION

ASSET PURCHASE AGREEMENT

     This Asset Purchase Agreement (this “Agreement”) is dated October 5, 2006, by and among Lam
Research Corporation, a Delaware corporation (“LRC”), and/or one or more of its designated
affiliates, (collectively, “Buyer”); Bullen Ultrasonics, Inc. (a/k/a Bullen Ultra-Sonics, Inc.), an
Ohio corporation (“Company”), Eaton 122 Ltd., an Ohio limited liability company (“E122”), Bullen
Semiconductor (Suzhou) Co., Ltd., a wholly foreign owned enterprise established in Suzhou New
District, Suzhou, Jiangsu, PRC (“Suzhou”) (the Company, E122 and Suzhou are sometimes referred to
as “Seller”, individually or “Sellers” collectively), Mary A. Bullen, a resident of Camden, Ohio
(“MB”) and Vicki A. Brown, a resident of Eaton, Ohio (“VB”) (MB and VB are referred to herein as
“Shareholders”, collectively) (Company, E122, Suzhou and the Shareholders are referred to herein as
“Seller Parties”, collectively and “Seller Party”, individually).

RECITALS

     Shareholders own, in the aggregate, sixty-nine (69) shares of the common voting stock of
Company, which constitute ninety-two percent (92%) of the issued and outstanding voting shares of
capital stock of Company. MB and VB own, in the aggregate, one hundred percent (100%) of the issued
and outstanding membership units entitled to vote of E122.

     Company owns 100% of the ownership interests of Suzhou.

     Sellers desire to sell, and Buyer desires to purchase, the Assets (as defined herein) of
Sellers for the consideration and on the terms set forth in this Agreement.

     MB and VB acknowledge and agree, as majority shareholders and members, respectively, of
Company and E122, that this Agreement and the transactions related hereto are of benefit to them,
constitute adequate consideration for their respective agreements herein and as contemplated hereby
and that Buyer would not have entered into this Agreement without their personal agreements herein
and as contemplated hereby.

     In connection with the execution of this Agreement, Company and Buyer have also entered into
that certain agreement relating to certain growers purchased or paid for by Buyer and installed at
Company premises, in the form attached hereto as Exhibit A, (the “Keeper Agreement”).

     The parties, intending to be legally bound, agree as follows:

1. Definitions and Usage

     1.1 DEFINITIONS

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

“Accounts Receivable”—(a) all trade accounts receivable and other rights to payment from customers
of the Business and the benefit of all security for such accounts or rights to payment, including
all trade accounts receivable representing amounts receivable in respect of goods shipped or
products

2

 

EXECUTION VERSION

sold or services rendered to customers of the Business prior to Closing and (b) all notes
receivable of the Business and the benefit of all security for such notes.

“Acquired Contracts”—as defined in Section 2.1(e).

“Adjustment Amount”—as defined in Section 2.8.

“Appurtenances”—all privileges, rights, easements, hereditaments and appurtenances belonging to or
for the benefit of the Land (as defined herein), including without limitation, all easements
appurtenant to and for the benefit of any Land (a “Dominant Parcel”) for, and as a means of access
between, the Dominant Parcel and a public way, or for any other use or benefit upon which lawful
use of the Dominant Parcel for the purposes for which it is presently being used is dependent, and
all rights existing in and to any streets, alleys, passages and other rights-of-way included
thereon or adjacent thereto (before or after vacation thereof) and vaults beneath any such streets.

“Assets”—as defined in Section 2.1.

“Assignment and Assumption Agreement”—the Company Assignment and Assumption Agreement and the
Suzhou Assignment and Assumption Agreement.

“Assumed Liabilities”—as defined in Section 2.4(a).

“Best Efforts”—the efforts that a reasonably prudent Person desirous of achieving a result would
use in similar circumstances to achieve that result as expeditiously as reasonably possible.

“Bill of Sale”—the Company Bill of Sale and the Suzhou Bill of Sale.

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

“Bulk Sales Laws”—as defined in Section 5.9.

“Business” — the silicon growing and silicon fabrication related businesses of the Company and
Suzhou, including but not limited to ultrasonic machining, CNC machining, prototype development,
lapping, polishing and crystal growing.

“Business Day”—any day other than (a) Saturday or Sunday or (b) any other day on which banks in
Ohio are permitted or required to be closed.

“Buyer”—as defined in the first paragraph of this Agreement.

“Buyer Indemnified Persons”—as defined in Section 11.2.

“Buyer’s Report”—as defined in Section 2.9.

“Carve-Out Financial Statements” — the consolidated balance sheet of the Company and Suzhou at July
31, 2006 and the consolidated income statement of the Company and Suzhou for the seven (7)

3

 

EXECUTION VERSION

month period ended July 31, 2006, prepared in each case in accordance with GAAP (as defined
herein), consistently applied, except for the variances from GAAP set forth on Exhibit B (the “GAAP
Exceptions”), which statements separately show (1) the full Company and Suzhou assets and
liabilities and the full Company and Suzhou results of operation through July 31, 2006, (2) the
adjustments to the full Company and Suzhou assets, liabilities and results of operation, (3) the
resulting assets, liabilities and results of operations, respectively, of the Business, (4) the
E122 assets relating to the Franklin Street Property and (5) the procedures employed to prepare
such financial statements, the accompanying statement of Grant Thornton, which Carve-Out Financial
Statements and procedures are Exhibit C attached hereto.

“Closing”—as defined in Section 2.6.

“Closing Asset Value”—the value of the assets of Suzhou and the value of the assets of the Company
and E122 related to the Franklin Street Property, determined consistently with the Estimated
Closing Asset Value and in accordance with GAAP except for the GAAP Exceptions, which includes only
Confirmed [***] Inventories as provided in Section 2.8(d), and which excludes (i) the reimbursed
costs up to $648,000 to Sellers, (ii) amounts reimbursed relating to the Construction Agreement,
respectively pursuant to Sections 2.3(c) and 2.4(a)(iv); (iii) any property or equipment purchased
or paid for by Buyer (including the property subject to the Keeper Agreement), (iv) the prepaid
item in the amount of $2,973,681, with respect to [***], and (v) the Real Property,
and will be prepared in all respects consistently with the balance sheet included in the Carve-Out
Financial Statements and the procedures related thereto.

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

“Closing Balance Sheet”—the consolidated balance sheet of the Company and Suzhou at the Closing
Date, which balance sheet shall be prepared in accordance with GAAP, consistently applied, and
consistent with the carve-out balance sheet included in the Carve-Out Financial Statements,
including the procedures related thereto.

“COBRA”—as defined in Section 3.16(f).

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

“Company”—as defined in the first paragraph of this Agreement.

“Company Assignment and Assumption Agreement”—as defined in Section 2.7(a)(ii).

“Company Bill of Sale”—as defined in Section 2.7(a)(i).

“Company Contract”—any Contract (a) under which any of Company, Suzhou or E122 has or may acquire
any rights or benefits; (b) under which any of Company, Suzhou or E122 has or may become subject to
any obligation or liability or (c) by which any of Company, Suzhou, E122 or any of the assets owned
or used by any of Company, Suzhou or E122, their respective Facilities (including the Franklin
Street Property of E122) or operations is or may become bound.

“Confidential Information”—as defined in Section 12.1.

THE
SYMBOL [***] IS USED TO INDICATE THAT A PORTION OF THE EXHIBIT HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTION.

4

 

EXECUTION VERSION

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

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

“Contract”—any agreement, contract, Lease, consensual obligation, promise or undertaking (whether
written or oral and whether express or implied), whether or not legally binding, including any
agreement or Exhibit attached hereto.

“Copyrights”—as defined in Section 3.25(a)(iii).

“Damages”—as defined in Section 11.2.

“DISC” —as defined in Section 3.31.

“Disclosure Schedule”—the disclosure schedule delivered by Seller Parties to Buyer concurrently
with the execution and delivery of this Agreement.

“E122”—as defined in the first paragraph of this Agreement.

“Effective Time”— 11:59 p.m. (local time at Facility) on the Closing Date.

“Employee Plans”—as defined in Section 3.16(a).

“Employment Agreement”—as defined in Section 2.7(a)(vii).

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

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

“Environmental, Health and Safety Liabilities”—any cost, damage, expense, liability, claim,
obligation or other responsibility arising from or under any Environmental Law or Occupational
Safety and Health Law, including those consisting of or relating to:

     (a) any environmental, health or safety matter or condition (including on-site or off-site
contamination, occupational safety and health and regulation of any substance or product);

     (b) any fine, penalty, judgment, award, settlement, legal or administrative proceeding,
damage, loss, claim, demand or response, remedial or inspection cost or expense arising under any
Environmental Law or Occupational Safety and Health Law;

     (c) financial responsibility under any Environmental Law or Occupational Safety and Health Law
for cleanup costs or corrective action, including any cleanup, removal, containment or

5

 

EXECUTION VERSION

other remediation or response actions (“Cleanup”) required by any Environmental Law or
Occupational Safety and Health Law (whether or not such Cleanup has been required, requested or
undertaken by any Governmental Body or any other Person) and for any natural resource damages; or

     (d) any other compliance, corrective or remedial measure required under any Environmental Law
or Occupational Safety and Health Law.

     The terms “removal,” “remedial” and “response action” include, but are not limited to, the
types of activities covered by the United States Comprehensive Environmental Response, Compensation
and Liability Act of 1980 (CERCLA).

“Environmental Law”—any Legal Requirement that requires or relates to:

     (a) advising appropriate authorities, employees or the public of intended or actual Releases
or Threatened Releases of pollutants or hazardous substances or materials, violations of discharge
limits or other prohibitions and the commencement of activities, such as resource extraction or
construction, that could have significant impact on the Environment;

     (b) preventing or reducing to acceptable levels the Release or Threat of Release of pollutants
or hazardous substances or materials into the Environment;

     (c) reducing the quantities, preventing the Release or Threat of Release or minimizing the
hazardous characteristics of wastes that are generated;

     (d) assuring that products are designed, formulated, packaged and used so that they do not
present unreasonable risks to human health or the Environment when used or disposed of;

     (e) protecting natural, cultural or environmental resources, species or ecological amenities;

     (f) reducing to acceptable levels the risks inherent in the transportation of hazardous
substances, pollutants, oil or other potentially harmful substances;

     (g) cleaning up pollutants that have been Released, preventing the Threat of Release or paying
the costs of such clean up or prevention;

     (h) making responsible parties pay or satisfy private parties, or groups of them, for damages
done to their health or the Environment or permitting self-appointed representatives of the public
interest to recover for injuries done to public assets; or

     (i) obtaining or maintaining any Governmental Authorization for, or complying with any Legal
Requirement relating to, operations, equipment, processes, emissions or permits that affect or
relate to the Environment from a governmental entity.

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

“Escrow Agreement”—as defined in Section 2.7(a)(ix).

6

 

EXECUTION VERSION

“Estimated Closing Asset Value”—the value of the assets of Suzhou and the value of the assets of
Company and E122 related to the Franklin Street Property, as set forth in Exhibit F attached
hereto, which value has been determined in accordance with GAAP, except for the GAAP Exceptions,
which includes all [***] Inventories, and excludes (i) the reimbursed costs up to $648,000 to
Sellers, (ii) the amounts reimbursed relating to the Construction Agreement (as defined herein),
respectively, pursuant to Sections 2.3(c) and 2.4(a)(iv), (iii) any property or equipment
purchased or paid for by Buyer (including the property subject to the Keeper Agreement), (iv) the
prepaid item in the amount of $2,973,681, with respect to [***] and (v) the Real
Property, and was prepared in all respects consistently with the balance sheet included in the
Carve-Out Financial Statements.

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

“Excluded Assets”—as defined in Section 2.2.

“Facilities”—any real property, leasehold or other interest in real property currently owned or
operated by Company, Suzhou or E122, including without limitation, the Tangible Personal Property
and Improvements used or operated by Company, Suzhou or E122 at the respective locations of the
Real Property specified in Section 3.7, including the Franklin Street Property (as defined herein)
of E122, but excepting and excluding the Camden Road Property and the Miller-Williams Road Property
(as such terms are defined herein). Notwithstanding the foregoing, for purposes of the definitions
of “Hazardous Activity” and “Remedial Action” and Section 3.22, “Facilities” shall mean any real
property, leasehold or other interest in real property currently or formerly owned or operated by
Company, Suzhou or E122, including without limitation, the Tangible Personal Property and
Improvements used or operated by Company, Suzhou or E122 at the respective locations of the Real
Property specified in Section 3.7.

“Franklin Street Lease”—the lease dated May 1, 2002 between E122 and Company, as amended March 30,
2006, regarding the Franklin Street Property (as defined herein) and any Real Property Lease or any
lease or rental agreement, license, right to use or installment and conditional sale agreement to
which Company is a party and any other Company Contract pertaining to the leasing or use of any
Tangible Personal Property (as defined herein) related to the Franklin Street Property.

“Franklin Street Property” —the Real Property commonly known as 950 South Franklin Street, Eaton,
Ohio and that Real Property commonly known as 1028 South Franklin Street, Eaton, Ohio, all as more
specifically described in Exhibit G.

“GAAP”—generally accepted accounting principles for financial reporting in the United States.

“Good Reason”—as defined in Section 2.8(c).

“Governing Documents”—with respect to any particular entity, (a) if a corporation, the articles or
certificate of incorporation or other charter documents and the bylaws or regulations (in the
applicable jurisdiction); (b) if a general partnership, the partnership agreement and any statement
of partnership; (c) if a limited partnership, the limited partnership agreement and the
certificate of limited partnership; (d) if a limited liability company, the articles of
organization and operating agreement; (e) if a wholly foreign owned enterprise, the articles of
association; (f) if another type of Person, any other charter or similar document adopted or filed
in connection with the creation,

THE
SYMBOL [***] IS USED TO INDICATE THAT A PORTION OF THE EXHIBIT HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTION.

7

 

EXECUTION VERSION

formation, organization or governance of the Person; (g) all equityholders’ agreements, voting
agreements, voting trust agreements, joint venture agreements, registration rights agreements or
other agreements or documents relating to the organization, management or operation of any Person
or relating to the rights, duties and obligations of the equityholders of any Person; and (h) any
amendment or supplement to any of the foregoing.

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

“Governmental Body”—any:

     (a) nation, state, county, province, city, town, borough, village, district or other
jurisdiction;

     (b) federal, state, local, municipal, foreign or other government;

     (c) governmental or quasi-governmental authority of any nature (including any agency, branch,
department, board, commission, court, tribunal or other entity exercising governmental or
quasi-governmental powers);

     (d) multinational organization or body;

     (e) body exercising, or entitled or purporting to exercise, any administrative, executive,
judicial, legislative, police, regulatory or taxing authority or power;

     (f) state-owned commercial enterprise; or

     (g) official or officer of any of the foregoing.

“Ground Lease”—any long-term lease of land in which most of the rights and benefits comprising
ownership of the land and the improvements thereon or to be constructed thereon, if any, are
transferred to the tenant for the term thereof.

“Ground Lease Property”—any land, improvements and appurtenances subject to a Ground Lease in
favor of any Seller Party and relating to the Assets or Business.

“Guarantees”—as defined in Section 2.7(a)(x).

“Hazardous Activity”—the distribution, generation, handling, importing, management, manufacturing,
processing, production, refinement, Release, storage, transfer, transportation, treatment or use
(including but not limited to any withdrawal or other use of groundwater) of Hazardous Material in,
on, under, about or from any of the Facilities or any part thereof into the Environment and any
other act, business, operation or thing that increases the danger, or risk of danger, or poses a
risk of harm, to persons or property on or off the Facilities.

“Hazardous Material”—any substance, material or waste which is or will foreseeably be regulated by
any Governmental Body, including but not limited to any material, substance or waste which is

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EXECUTION VERSION

defined as a “hazardous chemical,” “hazardous waste,” “hazardous material,” “hazardous substance,”
“extremely hazardous substance,” “restricted hazardous waste,” “contaminant,” “pollutant,” “toxic
waste” or “toxic substance” under any provision of Environmental Law, and including petroleum,
petroleum products, asbestos, presumed asbestos-containing material or asbestos-containing
material, urea formaldehyde and polychlorinated biphenyls.

“HSR Act”—the Hart-Scott-Rodino Antitrust Improvements Act, as amended.

“Improvements”—all buildings, structures, fixtures and improvements located on the Land or
included in the Assets, including those under construction and further including all equipment and
property purchased or paid for by Buyer.

“Indemnified Person”—as defined in Section 11.7.

“Indemnifying Person”—as defined in Section 11.7.

“Intellectual Property Assets”—as defined in Section 3.25(a).

“Interim Balance Sheet”—as defined in Section 3.4.

“Inventories”—all inventories of Company or Suzhou related to the Business, wherever located,
including all finished goods, work in process, raw materials, spare parts and all other materials
and supplies to be used or consumed by Company or Suzhou in the production of finished goods and
related to the Business.

“IRS”—the United States Internal Revenue Service and, to the extent relevant, the United States
Department of the Treasury.

“Keeper Agreement”—as defined in the recitals hereto.

“Knowledge”—an individual will be deemed to have Knowledge of a particular fact or other matter
if:

     (a) that individual is actually aware of that fact or matter; or

     (b) a prudent individual could be expected to discover or otherwise become aware of that fact
or matter in the course of conducting a reasonably comprehensive investigation, within the scope of
his/her job duties, including the accuracy of any representation or warranty contained in this
Agreement.

     A Seller Party will be deemed to have Knowledge of a particular fact or other matter if any of
the following: MB, VB, [***] has, or at any time had, Knowledge of that fact or other matter (as set forth
in (a) or (b) above), and any such individual (and any individual party to this Agreement) will be
deemed to have conducted a reasonably comprehensive investigation, within the scope of his/her job
duties, including the accuracy of the representations and warranties made herein by the Seller
Parties.

THE
SYMBOL [***] IS USED TO INDICATE THAT A PORTION OF THE EXHIBIT HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTION.

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EXECUTION VERSION

“Land”—all parcels and tracts of land in which Company, Suzhou or E122 has an ownership or
leasehold interest, including the Franklin Street Property and the rights pursuant to the
construction agreement dated October 4, 2006 by and between the Company and Humble Construction
Company, the purchase orders with Humble Construction Company related thereto and the purchase
orders of or issued to other contractors and subcontractors related to the expansion of the
Franklin Street Property, which agreement and purchase orders are attached hereto as Exhibit H (the
“Construction Agreement”), but excepting and excluding the property commonly known as 4613 Camden
Road, Eaton, Ohio, which property is described on Exhibit I attached hereto (the “Camden Road
Property”) and the property commonly known as 1301 Miller-Williams Road, Eaton, Ohio, which
property is described on Exhibit J attached hereto (the “Miller-Williams Road Property”).

“Legal Requirement”—any federal, state, local, municipal, provincial, foreign, national,
international, multinational or other constitution, law, ordinance, Order, stipulation, settlement,
principle of common law, code, regulation, statute or treaty.

“Liability”—any claim, liability or obligation of any kind, character or description, whether
known or unknown, absolute or contingent, accrued or unaccrued, disputed or undisputed, liquidated
or unliquidated, secured or unsecured, joint or several, due or to become due, vested or unvested,
executory, determined, determinable or otherwise, and whether or not the same is required to be
accrued on a financial statement.

“LRC China” — a wholly foreign owned enterprise to be formed under the laws of the Peoples Republic
of China and to be owned, directly or indirectly, by LRC or a subsidiary or affiliate of LRC.

“MB”—as defined in the first paragraph of this Agreement.

“Marks”—as defined in Section 3.25(a)(i).

“Material Consents”—as defined in Section 7.3.

“Material Interest”—as defined in the definition of “Related Person”.

“Occupational Safety and Health Law”—any Legal Requirement affecting or relating to working
conditions, occupational safety and health, including the Occupational Safety and Health Act, and
any program, whether governmental or private (such as those promulgated or sponsored by industry
associations and insurance companies), affecting or relating to safety and working conditions.

“Order”—any order, injunction, judgment, decree, ruling, assessment or arbitration award of any
Governmental Body or arbitrator.

“Ordinary Course of Business”—an action taken by a Person will be deemed to have been taken in the
Ordinary Course of Business only if that action:

     (a) is consistent in nature, scope and magnitude with the past practices of such Person and is
taken in the ordinary course of the normal, day-to-day operations of such Person, including but not
limited to matters involving Inventory and shipments; and

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EXECUTION VERSION

     (b) does not require authorization by the board of directors or shareholders of such Person
(or by any Person or group of Persons exercising similar authority) and does not require any other
separate or special authorization of any nature;

“Patents”—as defined in Section 3.25(a)(ii).

“Permitted Encumbrances”—as defined in Section 3.9(c).

“Person”—an individual, partnership, corporation, business trust, limited liability company,
limited liability partnership, joint stock company, trust, unincorporated association, joint
venture, enterprise or other entity, whether domestic or foreign, or a Governmental Body.

“Prepaid Assets”— all amounts prepaid, paid in advance or by deposit, for goods or services or
otherwise relating to the Assets or Business, whether designated as long term, current or other,
including but not limited to (i) the prepaid in the amount of
$2,973,681 relating to [***] and (ii) such items relating to the customer orders referred to in Section 2.4(a)(i).

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

“Production Certification”—as defined in Section 10.11.

“Production Output Requirements”—as defined in Section 3.10(b).

“Purchase Price”—as defined in Section 2.3.

“Qualifying Termination”—as defined in Section 2.8(c).

“Qualifying Termination Adjustment”—as defined in Section 2.8(c).

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

“Real Property Lease”—any Ground Lease or Space Lease.

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

“Related Person”— With respect to a particular individual:

     (a) each other member of such individual’s Family;

     (b) any Person that is directly or indirectly controlled by any one or more members of such
individual’s Family;

     (c) any Person in which members of such individual’s Family hold (individually or in the
aggregate) a Material Interest; and

THE
SYMBOL [***] IS USED TO INDICATE THAT A PORTION OF THE EXHIBIT HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTION.

11

 

EXECUTION VERSION

     (d) any Person with respect to which one or more members of such individual’s Family serves as
a director, officer, partner, executor or trustee (or in a similar capacity).

     With respect to a specified Person other than an individual:

     (a) any Person that directly or indirectly controls, is directly or indirectly controlled by
or is directly or indirectly under common control with such specified Person;

     (b) any Person that holds a Material Interest in such specified Person;

     (c) each Person that serves as a director, officer, partner, manager, executor or trustee of
such specified Person (or in a similar capacity);

     (d) any Person in which such specified Person holds a Material Interest; and

     (e) any Person with respect to which such specified Person serves as a general partner or a
trustee (or in a similar capacity).

     For purposes of this definition, (a) “control” (including “controlling,” “controlled by,” and
“under common control with”) means the possession, direct or indirect, of the power to direct or
cause the direction of the management and policies of a Person, whether through the ownership of
voting securities, by contract or otherwise, and shall be construed as such term is used in the
rules promulgated under the Securities Act; (b) the “Family” of an individual includes (i) the
individual, (ii) the individual’s spouse, (iii) any other natural person who is related to the
individual or the individual’s spouse within the second degree and (iv) any other natural person
who resides with such individual; and (c) “Material Interest” means direct or indirect beneficial
ownership (as defined in Rule 13d-3 under the Exchange Act) of voting securities or other voting
interests representing at least ten percent (10%) of the outstanding voting power of a Person or
equity securities or other equity interests representing at least ten percent (10%) of the
outstanding equity securities or equity interests in a Person.

“Release”—any release, spill, emission, leaking, pumping, pouring, dumping, emptying, injection,
deposit, disposal, discharge, dispersal, leaching or migration on or into the Environment or into,
out of, under or upon any property.

“Remedial Action”—all actions, including any capital or other expenditures, required or
voluntarily undertaken (a) to clean up, remove, treat or in any other way address any Hazardous
Material or other substance; (b) to prevent the Release or Threat of Release or to minimize the
further Release of any Hazardous Material or other substance so it does not migrate or endanger or
threaten to endanger public health or welfare or the Environment; (c) to perform pre-remedial
studies and investigations or post-remedial monitoring and care; or (d) to bring all Facilities
and the operations conducted thereon into compliance with Environmental Laws and environmental
Governmental Authorizations.

“Representative”—with respect to a particular Person, any director, officer, manager, employee,
agent, consultant, advisor, accountant, financial advisor, legal counsel or other representative of
that Person.

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EXECUTION VERSION

“Retained Business” —the non-silicon business presently conducted at the Camden Road Property and
which does not include use of the Assets or any business substantially similar to the Business.

“Retained Liabilities”—as defined in Section 2.4(b).

“SEC”—the United States Securities and Exchange Commission.

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

“Seller”—as defined in the first paragraph of this Agreement.

“Seller Parties”—as defined in the first paragraph of this Agreement.

“Selling Parties’ Representative”—as defined in Section 13.16.

“Shareholders”—as defined in the first paragraph of this Agreement.

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

“Space Lease”—any lease or rental agreement pertaining to the occupancy of any improved space on
any Land.

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

“Suzhou Assignment and Assumption Agreement”—as defined in Section 2.7(a)(ii).

“Suzhou Bill of Sale”—as defined in Section 2.7(a)(i).

“Tangible Personal Property”—all machinery, equipment, tools, parts, furniture, office equipment,
computer hardware, supplies, materials, vehicles and other items of tangible personal property
(other than Inventories) of every kind owned or leased by Company or Suzhou (wherever located and
whether or not carried on Company’s or Suzhou’s books) relating to or used in the Business, which
tangible personal property as of June 30, 2006 is listed on Schedule 2.1(b) attached hereto,
together with any express or implied warranty by the manufacturers or sellers or lessors of any
item or component part thereof, all service agreements, all guarantees, all rights to return, all
credits and other rights with respect thereto and all maintenance records and other documents
relating thereto, notwithstanding the foregoing, certain Excluded Assets used by the Company in
connection with the Retained Business have been, and may prospectively be, used by the Company in
connection with certain silicon related activities permitted by the Noncompetition Agreement, and
such use does not

13

 

EXECUTION VERSION

cause such Excluded Assets to be Tangible Personal Property or Assets for purposes of this
Agreement.

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

“Tax Return”—any return (including any information return), report, statement, schedule, notice,
form, declaration, claim for refund or other document or information filed with or submitted to, or
required to be filed with or submitted to, any Governmental Body in connection with the
determination, assessment, collection or payment of any Tax or in connection with the
administration, implementation or enforcement of or compliance with any Legal Requirement relating
to any Tax.

“Third Party”—a Person that is not a party to this Agreement.

“Third-Party Claim”—any claim against any Indemnified Person by a Third Party, whether or not
involving a Proceeding.

“Threat of Release”—a reasonable likelihood of a Release that may require action in order to
prevent or mitigate damage to the Environment, or effect compliance with any Legal Requirements,
that may result from, or relate to, such Release.

“VB”—as defined in the first paragraph of this Agreement.

“WARN Act”—as defined in Section 3.23(d).

     1.2  USAGE

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

               (i) the singular number includes the plural number and vice versa;

               (ii) reference to any Person includes such Person’s successors and assigns but, if
applicable,
only if such successors and assigns are not prohibited by this Agreement, and reference to a Person
in a particular capacity excludes such Person in any other capacity or individually;

               (iii) reference to any gender includes each other gender;

               (iv) reference to any agreement, document or instrument means such agreement, document or
instrument as amended or modified and in effect from time to time in accordance with the terms
thereof;

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EXECUTION VERSION

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

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

               (vii) “including” (and with correlative meaning “include”) means including without limiting
the generality of any description preceding such term;

               (viii) “or” is used in the inclusive sense of “and/or”;

               (ix) with respect to the determination of any period of time, “from” means “from and
including” and “to” means “to but excluding”; and

               (x) references to documents, instruments or agreements shall be deemed to refer as well to all
addenda, exhibits, schedules or amendments thereto.

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

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

          (d) References to “material,” “materially” and “materiality” in Section 3 of this Agreement
shall refer to, or be construed in reference to, the Business, assets or operations of Sellers.

2. Sale and Transfer of Assets; Closing

     2.1 ASSETS TO BE SOLD

     Upon the terms and subject to the conditions set forth in this Agreement, at the Closing, but
effective as of the Effective Time, Sellers shall sell, convey, assign, transfer and deliver to
Buyer (with respect to the Assets of Suzhou, to LRC China and with respect to the Assets of Company
and
E122, to LRC), and Buyer (with respect to the Assets of Suzhou, LRC China and with respect to
the Assets of Company and E122, LRC) shall purchase and acquire from Sellers, free and clear of any
Encumbrances other than Permitted Encumbrances, all right, title and interest in and to all of
Sellers’ property and assets, real, personal or mixed, tangible and intangible, of every kind and
description, wherever located, related to or used in the Business, including the following:

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EXECUTION VERSION

          (a) all Real Property described in Schedules 3.7 and all leasehold interest of Sellers in any
Real Property described in Schedule 3.8;

          (b) all Tangible Personal Property, including those items described in Schedule 2.1(b) as of
June 30, 2006;

          (c) all Inventories, which Inventories as of July 31, 2006 are listed on Schedule 2.1(c);

          (d) all Prepaid Assets, which Prepaid Assets as of July 31, 2006 are listed on Schedule
2.1(d);

          (e) except to the extent subject to Section 2.10 hereof, all Company Contracts listed on
Schedule 2.1(e), and all outstanding offers, solicitations and rights with respect to any such
Contract and listed on a Schedule to the Assignment and Assumption Agreement (the “Acquired
Contracts”);

          (f) all Governmental Authorizations and all pending applications therefor or renewals thereof,
including those listed on Schedule 3.17(b), but excluding those listed on Schedule 3.17(c);

          (g) all data and Records related to the operations of Company, Suzhou and the Business,
including client and customer lists and Records, sales and marketing data, referral sources,
research and development reports and Records, production reports and Records, Records required
under Environmental Laws, service and warranty Records, equipment logs, operating guides and
manuals, financial and accounting Records, creative materials, advertising materials, promotional
materials, studies, reports, correspondence and other similar documents and Records and, subject to
Legal Requirements, copies of all personnel Records and other Records described in Section 2.2(g);

          (h) except for the names “Bullen” (subject to Buyer’s right to use the name “Bullen” set forth
in Section 5.13), “Bullen Ultra-sonics”, “Bullen Ultrasonics” and the rights listed on Schedule
3.25(i) (the “Excluded IP”), all of the intangible rights and property of either Company or
Suzhou, including but not limited to Intellectual Property Assets, going concern value, goodwill,
telephone and telecopy numbers listed on Schedule 3.25(a), to the extent permitted by the
appropriate telecommunications provider, and those items listed in Schedules 3.25(d), (e), (f) and
(h), other than the Excluded IP;

          (i) all insurance benefits, including rights and proceeds, arising from or relating to the
Assets, Business or the Assumed Liabilities, unless expended in accordance with this Agreement; and

          (j) all claims against Third Parties relating to the Assets or Business, whether choate or
inchoate, known or unknown, contingent or noncontingent, including but not all such claims listed
in Schedule 2.1(j)

          (k) all claims, rights and interests of any of Seller Parties relating to the Assets or
Business, whether choate or inchoate, known or unknown, contingent or noncontingent, including but
not limited to all such claims, rights and interests listed in Schedule 2.1(k).

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EXECUTION VERSION

          (l) [Intentionally left blank.]

     All of the property, claims, benefits, rights and assets described above and to be transferred
to Buyer hereunder are herein referred to collectively as the “Assets.”

     Notwithstanding the foregoing, the transfer of the Assets pursuant to this Agreement shall not
include the assumption of any Liability related to the Assets unless Buyer expressly assumes that
Liability pursuant to Section 2.4(a).

     2.2 EXCLUDED ASSETS

     The following assets of Sellers (collectively, the “Excluded Assets”) are not part of the sale
and purchase contemplated hereunder, are excluded from the Assets and shall remain the property of
Sellers after the Closing:

          (a) the names “Bullen” (subject to Buyer’s right to use the name “Bullen” set forth in Section
5.13), “Bullen Ultra-Sonics” and “Bullen Ultrasonics”;

          (b) all Accounts Receivable;

          (c) all cash and cash equivalents;

          (d) all minute books, stock Records and corporate seals of Sellers;

          (e) the shares of capital stock of Company;

          (f) all of the Company Contracts listed in Schedule 2.2(f) (the “Retained Contracts”);

          (g) all personnel Records and other Records that Sellers are required by law to retain in
their possession;

          (h) all claims for refund of Taxes applicable to periods of time prior to the Closing Date
related to the Business;

          (i) all rights and obligations in connection with the Employee Plans;

          (j) all rights of Seller Parties under this Agreement, the Bill of Sale, the Assignment and
Assumption Agreement and the Escrow Agreement;

          (k) the Excluded IP, which is listed on Schedule 3.25(i);

          (l) the shares of capital stock of Suzhou;

          (m) the property and assets expressly listed on Schedule 2.2(m);

          (n) the email addresses and listings of the Company and Suzhou; and.

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EXECUTION VERSION

          (o) the
rights to pursue claims against and recoveries, payment and judgments
against [***] with
respect to the Non-Confirmed [***] Inventories.

     2.3 CONSIDERATION

     The consideration for the Assets (the “Purchase Price”) is (a) One hundred and seventy five
million dollars ($175,000,000) (i) plus or minus the Adjustment Amount, (ii) less the Vacation and
Personal Time Liability (as defined herein), (b) plus the costs incurred in connection with the
expansion of the Franklin Street Property after January 1, 2006 and prior to June 22, 2006, not to
exceed $648,000, (c) plus the reimbursement of construction costs in accordance with the
Construction Agreement incurred between June 22, 2006 and the Closing Date and (d) the assumption
of the Assumed Liabilities. In accordance with Section 2.7(b), at the Closing, the Closing Payments
(as defined in Section 2.7 (b)) and, prior to adjustment on account of the Adjustment Amount and
the Vacation and Personal Time Liability, shall be delivered by Buyer to Seller Parties and the
escrow agent. The Purchase Price is subject to the adjustments provided in Section 2.8.

2.4 LIABILITIES

          (a) Assumed Liabilities. On the Closing Date, but effective as of the Effective Time, Buyer (with
respect to Liabilities of Suzhou, LRC China and with respect to the Liabilities of Company and
E122, LRC) shall assume and agree to discharge only the following Liabilities of Sellers (the
“Assumed Liabilities”):

               (i) [intentionally left blank]

               (ii) any Liability arising after the Effective Time under the Acquired Contracts (other than
any Liability arising under the Acquired Contracts or arising out of or relating to a Breach that
occurred prior to the Effective Time);

               (iii) the Franklin Street costs incurred in connection with the expansion of the Franklin
Street Property not to exceed $648,000, as set forth in Section 2.3;

               (iv) the obligation to reimburse Sellers for construction costs incurred in accordance with
the Construction Agreement and incurred between June 22, 2006 and the Closing Date, as set forth
in Section 2.3; and

               (v) the liability for accrued vacation and personal days of the employees of the Business, who
accept Buyer’s offer of employment, which accrued liability is estimated to be $480,764.35, in the
aggregate, as of September 30, 2006, as set forth on Schedule 2.4(a)(v).

          (b) Retained Liabilities. The Retained Liabilities shall remain the sole responsibility of and
shall be retained, paid, performed and discharged solely by Sellers. “Retained Liabilities” shall
mean every Liability other than the Assumed Liabilities, including:

               (i) any accounts payable of any Seller, including any Liability for any credit, return or
allowance;

THE
SYMBOL [***] IS USED TO INDICATE THAT A PORTION OF THE EXHIBIT HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTION.

18

 

EXECUTION VERSION

               (ii) any accrued expenses of any Seller;

               (iii) any bank or other debt (not specifically included in the Assumed Liabilities);

               (iv) any Liability arising out of or relating to products of either Company or Suzhou to the
extent manufactured or sold prior to the Effective Time, including but not limited to any claim or
Liability arising out of or related to non-conformance, defect, breach of warranty or the
infringement of any right of any Third Party, Shareholder or any Related Person;

               (v) any Liability under any Acquired Contract assumed by Buyer pursuant to Section 2.4(a)(ii)
that arises out of or relates to any Breach that occurred prior to the Effective Time;

               (vi) any Liability for Taxes, including (A) any Taxes arising as a result of any Seller’s
operation of its business or Seller Parties’ ownership of the Assets prior to the Effective Time,
(B) any Taxes that will arise as a result of the sale of the Assets pursuant to this Agreement and
(C) any deferred Taxes of any nature;

               (vii) any Liability under any Contract not assumed by Buyer under Section 2.4(a), including
any Liability arising out of or relating to either Company’s or Suzhou’s credit or loan facilities
or agreements or any security interest related thereto;

               (viii) any Environmental, Health and Safety Liabilities arising out of or relating to the
operation, respectively, of any Seller’s business or any Seller’s respective leasing, ownership or
operation of real property;

               (ix) any Liability under the Employee Plans or relating to pension benefits, employee stock
option or profit-sharing plans, health care plans or benefits or any other employee plans or
benefits of any kind for either Sellers’ employees or former employees or both;

               (x) any Liability relating to payroll, commissions, bonuses, sick leave or other leave,
severance, workers’ compensation, unemployment compensation or any other Liability to employees of
any Seller (in any case whether accrued, banked or otherwise), including any liability under the
WARN Act;

               (xi) any Liability under any employment, severance, retention or termination agreement with
any employee of any Seller or any of their respective Related Persons;

               (xii) any Liability arising out of or relating to any employee grievance, discrimination or
other claim arising out of or related to any time prior to the Effective Time whether or not the
affected employees are hired by Buyer;

               (xiii) any Liability to any shareholder, member or Related Person of any Seller Party existing
as of the Effective Time, excluding Buyer’s obligations expressly provided herein to the above
mentioned Persons arising under this Agreement and the Contemplated Transactions;

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EXECUTION VERSION

               (xiv) any Liability to indemnify, reimburse or advance amounts to any officer, director,
manager, employee or agent of any Seller existing as of the Effective Time, excluding Buyer’s
obligations expressly provided herein to the above mentioned Persons under this Agreement and the
Contemplated Transactions;

               (xv) any Liability to distribute to any shareholders or members or otherwise apply all or any
part of the consideration received hereunder (except for the consideration paid to the Shareholders
at Closing for their Noncompetition Agreements and related agreements pursuant to Section
2.7(a)(viii));

               (xvi) any Liability arising out of any Proceeding pending as of the Effective Time;

               (xvii) any Liability arising out of any Proceeding commenced after the Effective Time and
arising out of or relating to any occurrence or event happening prior to the Effective Time;

               (xviii) any Liability arising out of or resulting from any Seller’s compliance or
noncompliance with any Legal Requirement or Order of any Governmental Body;

               (xix) any Liability of any Seller Party under this Agreement or any other document executed in
connection with the Contemplated Transactions; and

               (xx) any Liability of any Seller Party based upon any Seller Party’s acts or omissions
occurring after the Effective Time.

     2.5 ALLOCATION

     Buyer shall prepare and furnish to Sellers an allocation of the Purchase Price among the
Assets, to Seller Parties within forty-five (45) days after Closing, which allocation shall be
subject to Sellers’ reasonable approval. Such allocation shall be in accordance with §1060 of the
Code and the Treasury regulations thereunder (and any similar provision of state, local or foreign
law) and shall be binding on the Company and Seller Parties. The parties agree that the Purchase
Price shall be allocated in amounts equal to the fair market value of the Assets, including
identified intangibles, with the balance allocated to goodwill. The parties shall make consistent
use of the allocation, fair market value and useful lives specified in such allocation furnished by
Buyer for all Tax purposes and in all filings, declarations and reports with the IRS in respect
thereof, including the reports required to be filed under Section 1060 of the Code. Buyer shall
prepare and deliver IRS Form 8594 to Company within forty-five (45) days after the Closing Date to
be filed with the IRS, which form
shall be consistent in all respects with such allocation. Company and Seller Parties shall
timely and properly prepare, execute, file and deliver all such documents, forms and other
information as Buyer may reasonably request in connection with such allocation. In any Proceeding
related to the determination of any Tax, neither Buyer nor any Seller Party shall contend or
represent that such allocation is not a correct allocation or otherwise take any action
inconsistent with such allocation.

     2.6 CLOSING

20

 

EXECUTION VERSION

     The purchase and sale provided for in this Agreement (the “Closing”) will take place at the
offices of Buyer’s counsel at 255 E. Fifth Street, Suite 1900, Cincinnati, Ohio 45202, commencing
at 10:00 a.m. (local time — Cincinnati, Ohio) on the later of (a) November 9, 2006 or (b) the date
that is five (5) Business Days following the termination of the applicable waiting period under the
HSR Act, unless Buyer and Sellers otherwise mutually agree. Subject to the provisions of Article 9,
failure to consummate the purchase and sale provided for in this Agreement on the date and time and
at the place determined pursuant to this Section 2.6 will not result in the termination of this
Agreement and will not relieve any party of any obligation under this Agreement.

     2.7 CLOSING OBLIGATIONS

     In addition to any other documents to be delivered under other provisions of this Agreement,
at the Closing:

          (a) Seller Parties shall deliver to Buyer, together with funds sufficient to pay all Taxes
necessary for the transfer, filing or recording of the conveyance of the Franklin Street Property:

               (i) a bill of sale for all of the Assets of Company and E122 that are Tangible Personal
Property and Inventories in the form of Exhibit M (the “Company Bill of Sale”) and a bill of sale
for all of the Assets of Suzhou that are Tangible Personal Property and Inventories in the form of
Exhibit N (the “Suzhou Bill of Sale”) each executed by Seller Parties;

               (ii) an assignment of all of the Assets of Company and E122 that are intangible personal
property, including without limitation the Intellectual Property Assets, in the form of Exhibit O,
including but not limited to Acquired Contracts, which assignment shall also contain Buyer’s
undertaking and assumption of the Assumed Liabilities (the “Company Assignment and Assumption
Agreement”) and an assignment of all of the Assets of Suzhou that are intangible personal property,
including without limitation the Intellectual Property Assets, in the form of Exhibit P, including
but not limited to Acquired Contracts, which assignment shall also contain Buyer’s undertaking and
assumption of the Assumed Liabilities (the “Suzhou Assignment and Assumption Agreement”) each
executed by Seller Parties;

               (iii) for each interest in Real Property identified on Schedule 3.7, a recordable general
warranty deed in form and substance satisfactory to Buyer and its counsel and executed by the
appropriate Seller Parties;

               (iv) a termination and general release with respect to the Franklin Street Lease, effective as
of the Effective Time, in the form and substance satisfactory to Buyer and its counsel and executed
by Company and E122;

               (v) Intentionally left blank;

               (vi) such other deeds, bills of sale, assignments, certificates of title, documents and other
instruments of transfer and conveyance as may reasonably be requested by Buyer, each in form and
substance satisfactory to Buyer and its legal counsel and executed by Seller Parties;

21

 

EXECUTION VERSION

               (vii) an
employment agreement in the form of Exhibit R, executed by [***] (the
“Employment Agreement”);

               (viii) noncompetition agreements in the form of Exhibit S, executed by each Seller Party (the
“Noncompetition Agreements”);

               (ix) the Escrow Agreement (as defined in Section 2.11) in the form of Exhibit T, executed by
Seller Parties and the escrow agent;

               (x) the personal guarantee of each Shareholder in the form of Exhibit U (the “Guarantees”)
executed by Shareholders;

               (xi) a certificate executed by each Seller Party as to the accuracy of their representations
and warranties as of the date of this Agreement and as of the Closing in accordance with Section
7.1 and as to their respective compliance with and performance of their covenants and obligations
to be performed or complied with at or before the Closing in accordance with Section 7.2;

               (xii) a certificate of the Secretary of each Seller certifying, as complete and accurate as of
the Closing, attached copies of the Governing Documents of each Seller, certifying and attaching
all requisite resolutions or actions of each Seller’s respective board of directors, managers,
members and shareholders approving the execution and delivery of this Agreement and the
consummation of the Contemplated Transactions including but not limited to the approval required by
Ohio Revised Code §1701.76 and certifying to the incumbency and signatures of the officers of each
Seller executing this Agreement and any other document relating to the Contemplated Transactions;

               (xiii) releases of all liens, security interests and other Encumbrances with respect to the
Assets, except for the Permitted Encumbrances, in form and substance satisfactory to Buyer and its
legal counsel, executed by the respective Third Party;

               (xiv) owner’s affidavits, non-foreign affidavits, transfer tax declarations, settlement
statements and such other instruments and documents related to or regarding the conveyance of the
Real Property, Real Property Leases and Facilities as Buyer’s title insurance company may require;

               (xv) a release, executed by each Shareholder with respect to any ownership or interest in the
Assets or Business, in the form of Exhibit V attached hereto;

               (xvi) written consent to the use by Buyer of the name “Bullen Semiconductor” in the Business
as set forth in Section 5.13; and

               (xvii) executed amendment to its charter documents and written confirmation of such other
action confirming that Suzhou has changed its name as required by Section 5.13;

               (xviii) written confirmation (A) from each of the counterparties to the Construction
Agreement, as of a date not later than (5) days prior to Closing, of amounts paid by Sellers
pursuant to the Construction Agreement and each purchase order, shown by individual

THE
SYMBOL [***] IS USED TO INDICATE THAT A PORTION OF THE EXHIBIT HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTION.

22

 

EXECUTION VERSION

purchase orders
and (B) payments made of the Franklin Street Costs, in each case under the foregoing clauses (A)
and (B) showing and reasonably detailing the payments and the agreement, purchase order or other
commitment to which the payment relates ;

               (xix) reliance letter, in form and substance satisfactory to Buyer and its counsel, from Hart
Environmental Resources regarding the Phase I Environmental Site Assessment of 950 S. Franklin
Street, Eaton, Ohio, No. D06362 and the Phase I Environmental Site Assessment of 1028 S. Franklin
Street, Eaton, Ohio, No. E003689;

               (xx) reliance letter, in form and substance satisfactory to Buyer and its counsel, from
Professional Service Industries, Inc. regarding Subsurface Exploration and Foundation
Recommendations for the Proposed Building Addition Bullen Ultrasonics, 950 S. Franklin Street,
Eaton, Ohio, Report Number 105-65006, dated June 2, 2006;

               (xxi) the License Agreement in the form of Exhibit W (the “License Agreement”);

               (xxii) the Toolholder License Agreement in the form of Exhibit X (the “Toolholder License
Agreement”); and

               (xxiii) the
certifications with respect to the [***] Inventories pursuant to Section 2.8(d)
hereof.

          (b) Buyer shall deliver to Seller Parties, as the case may be the following amounts (the
“Closing Payments”) to accounts specified in a writing delivered by each Seller Party at least
three (3) business days prior to Closing (the “Disbursement Statement”):

               (i) One hundred forty-seven million three hundred and fifty seven dollars ($147,357,000) by
wire transfer to an account specified by Company in a writing delivered to Buyer at least three (3)
business days prior to the Closing Date;

               (ii) the Franklin Street Costs (as defined in Section 6.4) to an account specified by the
Company in the Disbursement Statement;

               (iii) [***]

               (iv) [***]

               (v) Nine million nine hundred and forty three thousand dollars ($9,943,000) by wire transfer
to an account specified by E122 in the Disbursement Statement, in consideration for the sale and
transfer of the Franklin Street Property.

          (c) Buyer shall deliver to Seller Parties:

THE
SYMBOL [***] IS USED TO INDICATE THAT A PORTION OF THE EXHIBIT HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTION.

23

 

EXECUTION VERSION

               (i) the Escrow Agreement, executed by Buyer and the escrow agent, together with the delivery
of the Escrow Amount to the escrow agent thereunder, by wire transfer to an account specified by
the escrow agent;

               (ii) the Company Assignment and Assumption Agreement and the Suzhou Assignment and Assumption
Agreement each executed by Buyer;

               (iii) the Noncompetition Agreements executed by Buyer;

               (iv) the License Agreement;

               (v) a certificate executed by Buyer as to the accuracy of its representations and warranties
as of the date of this Agreement and as of the Closing in accordance with Section 8.1 and as to its
compliance with and performance of its covenants and obligations to be performed or complied with
at or before the Closing in accordance with Section 8.2;

               (vi) a certificate of an officer of Buyer certifying, as complete and accurate as of the
Closing, attached copies of the Governing Documents of Buyer, and certifying and attaching all
requisite resolutions or actions of Buyer’s board of directors approving the execution and delivery
of this Agreement and the consummation of the Contemplated Transactions and certifying to the
incumbency and signatures of the officers of Buyer executing this Agreement and any other document
relating to the Contemplated Transactions; and

               (vii) the Toolholder License Agreement.

24

 

EXECUTION VERSION

     2.8 ADJUSTMENT AMOUNT AND PAYMENT

          (a) The “Adjustment Amount” (which may be a positive or negative number) will be equal to the
amount determined by subtracting the Closing Asset Value from the Estimated Closing Asset Value. If
the Adjustment Amount is positive, the Adjustment Amount shall be paid by wire transfer by Company
to Buyer in an account specified by Buyer. If the Adjustment Amount is negative, the Adjustment
Amount shall be paid by wire transfer by Buyer to Company to an account specified by Company. The
maximum adjustment amount payable to Company, if applicable, is $10,000,000; provided,
however, the $10,000,000 maximum shall not apply if both (i) the resulting Adjustment
Amount due to Company is caused by an increase in inventory related to the Business reflected in
the Closing Asset Value, which increase in inventory is directly related to written orders or
written production requests by Buyer which orders or production requests materially exceed the
projected orders or projected production requests of Buyer, in the amount of [***], as set
forth in Company’s 2006 budget and (ii) on the Closing Date and based on inventory reflected in the
Closing Asset Value, Company’s ratio of inventory to production output related to the Business has
not materially increased compared to its ratio of inventory to production output of [***] which
ratio is consistent with the Company’s historical practices and operations. All payments shall be
made
together with interest at the rate equal to the prime rate of ABN AMRO as established from
time to time, which interest shall begin accruing on the Closing Date and end on the date that the
payment is made. Within three (3) business days after the calculation of the Closing Asset Value
becomes binding and conclusive on the parties pursuant to Section 2.9, Sellers or Buyer, as the
case may be, shall make the wire transfer payment provided for in this Section 2.8.

          (b) The Purchase Price is also subject to adjustment downward by the amount of accrued
vacation and personal time off as of the Effective Time for the employees of the Business who
accept Buyer’s offer of employment (the “Vacation and Personal Time Liability”). Company shall pay
Buyer by wire transfer payment the amount of the Vacation and Personal Time Liability within three
(3) business days after such calculation of the vacation and Personal Time Liability becomes
binding and conclusive on the parties pursuant to Section 2.9.

          (c)    (i) The Purchase Price is also subject to a downward adjustment as set forth below (the
“Qualifying Termination Adjustment”) if [***] voluntarily leaves the employ of Buyer
other than for Good Reason (as hereinafter defined) or is terminated for “cause” (as defined in the
Employment Agreement) (each a “Qualifying Termination”) at any time within the first two (2) years
following the Closing Date. For purposes of this Agreement, “Good Reason” means any of the
following (A) a material adverse change in [***] responsibilities, duties, benefits or
compensation (other than a change in compensation or benefits that is applicable to all executives
of Buyer at a substantially similar level) of employment with Buyer, (B) material breach by Buyer
under the terms of the Employment Agreement, or (C) a
requirement that [***] relocate to
a facility or office that is more than 50 miles from his residence as a condition of continued
employment.

                    (A) If a Qualifying Termination occurs at any time before or on the first anniversary of the
Closing Date, the Qualifying Termination Adjustment shall be $7,000,000.

THE
SYMBOL [***] IS USED TO INDICATE THAT A PORTION OF THE EXHIBIT HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTION.

25

 

EXECUTION VERSION

                    (B) If a Qualifying Termination occurs at any time after the first anniversary of the Closing
Date but before or on the second anniversary of the Closing Date, the Qualifying Termination
Adjustment shall be $5,000,000.

                    (C) If a Qualifying Termination occurs at any time after the second anniversary of the Closing
Date, there shall be no Qualifying Termination Adjustment.

               (ii) Any Qualifying Termination Adjustment will be a reduction in the portion of the Purchase
Price payable to Company.

               (iii) Company shall pay the Qualifying Termination Adjustment, in immediately available funds
by wire transfer to Buyer’s account, within fifteen (15) business days following Company’s receipt
of notice of the occurrence of a Qualifying Termination.

          (d) The parties agree that the Estimated Closing Asset Value includes $1,009,000 of
Inventories which is accounted for by the Company as physically held
by [***] on the books and financial records of the Company
(the “[***] Inventories”). The Company has not been able to confirm that [***] Inventories have not
been subject to loss or damage. At Closing, Company will provide Buyer with a written
certification, which certification details [***] Inventories, including (a) that portion of the [***]
Inventories that can be confirmed by the Company, with reasonable supporting conformation
satisfactory to Buyer, to be existing, available to the Company without claim, offset or deduction
by [***] and of a commercially useable quality (which shall not be scrap, damaged or non-confirming)
(the “Confirmed [***] Inventories”) and (b) that portion of the [***] Inventories that is not Confirmed
[***] Inventories, with detail by product and quantity (the “Non-Confirmed [***] Inventories”).

     2.9 PHYSICAL INVENTORY AND ADJUSTMENT PROCEDURE

          (a) After the close of business on the day immediately preceding the Closing Date, Sellers and
Buyer, and/or their respective Representatives, shall jointly conduct a physical inventory of the
Inventories as of the Closing Date and an audit and tagging of the Tangible Personal Property as of
the Closing Date. Buyer shall prepare a written report setting forth the results thereof (the
“Inventory and Tangible Personal Property Report”), which Inventory and Tangible Personal Property
Report shall be used in determining the Inventories and fixed assets value in the Closing Asset
Value. Seller Parties and Buyer agree that (i) the physical count, as taken by Sellers and Buyer,
shall be final and binding, and may not be objected to, on such basis, by Sellers in any Selling
Parties’ Representative’s objection notice provided for in this Sections 2.9, and (ii) the
Inventories reflected in the Inventory and Tangible Personal Property Report will be valued at the
lower of cost or market value; provided, however, no amount shall be included in
the Inventory and Tangible Personal Property Report for any excess or obsolete Inventories. For
purposes of this Section 2.9(a), “excess and obsolete” Inventories shall mean Inventory quantities
in excess of 12 month’s historical consumption. The Inventory and Tangible Personal Property
Report shall be included in and set forth in the Buyer’s Report (as hereinafter defined).

          (b) Buyer shall prepare the Closing Balance Sheet and statement of Closing Asset Value as of
the Closing Date. Buyer shall deliver the Closing Balance Sheet, its determination of the Closing
Asset Value, the amount of the Vacation and Personal Time Liability, the Inventory and

THE
SYMBOL [***] IS USED TO INDICATE THAT A PORTION OF THE EXHIBIT HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTION.

26

 

EXECUTION VERSION

Tangible
Personal Property Report and the resulting calculations, including any Adjustment Amount and the
party to whom it is payable (the “Buyer’s Report”) to Selling Parties’ Representative within
forty-five (45) days following the Closing Date. Sellers, and Sellers’ accountants, shall give
Buyer and its accountants, access to the books and records and personnel of Sellers, including the
work papers of Grant Thornton with respect to the Carve-Out Financial Statements.

          (c) If within thirty (30) days following delivery of Buyer’s Report, Selling Parties’
Representative has not given Buyer written notice of its objection as to the Buyer’s Report (which
notice shall state in reasonable detail the basis of Selling Parties’ Representative objection,
including the proposed adjustment(s), thereto), then the Buyer’s Report and the calculation
included therein shall be final, binding and conclusive on the parties and be used in computing the
Adjustment Amount and the amount of the Vacation and Personal Time Liability.

          (d) If Selling Parties’ Representative gives Buyer timely notice of objection, and if Selling
Parties’ Representative and Buyer fail to resolve the issues outstanding with respect to the
Buyer’s Report within thirty (30) days of Buyer’s receipt of Selling Parties’ Representative
objection notice, Selling Parties’ Representative and Buyer shall submit the issues remaining in
dispute to Deloitte & Touche, independent public accountants (the “Independent Accountants”) for
resolution
applying the principles, policies and practices referred to in Section 2.9(c), which
independent public accountants have not been engaged by any Buyer or Seller Party during the 3 year
period immediately preceding the date of this Agreement or at any time subsequent to the date of
this Agreement and prior to the resolution of any dispute pursuant to Sections 2.8 or 2.9. If
issues are submitted to the Independent Accountants for resolution, (i) Selling Parties’
Representative, Sellers and Buyer shall furnish or cause to be furnished to the Independent
Accountants such work papers and other documents and information relating to the disputed issues as
the Independent Accountants may request and are available to that party or its accountants and
shall be afforded the opportunity to present to the Independent Accountants any material relating
to the disputed issues and to discuss the issues with the Independent Accountants; (ii) the
independent accountants shall only resolve or adjust the amounts in dispute as set forth in Selling
Parties’ Representative written objection; (iii) the determination by the Independent Accountants,
as set forth in a written determination to be delivered to both Selling Parties’ Representative and
Buyer within sixty (60) days of the submission to the Independent Accountants of the issues
remaining in dispute, shall be final, binding and conclusive on the parties and shall be used in
the calculation of the Adjustment Amount and (iv) Sellers and Buyer will each bear fifty percent
(50%) of the fees and costs of the Independent Accountants for such determination.

     2.10 CONSENTS

          (a) If there are any Material Consents that have not yet been obtained (or otherwise are not
in full force and effect) as of the Closing, in the case of each Company Contract as to which such
Material Consents were not obtained (or otherwise are not in full force and effect) (the
“Restricted Material Contracts”), Buyer may waive the closing conditions as to any such Material
Consent and either:

               (i) elect to have Sellers continue their efforts to obtain the Material Consents; or

27

 

 EXECUTION VERSION

               (ii) elect to have Sellers retain that Restricted Material Contract and all Liabilities
arising therefrom or relating thereto.

If Buyer elects to have Sellers continue their efforts to obtain any Material Consents and the
Closing occurs, notwithstanding Sections 2.1 and 2.4, neither this Agreement nor the Assignment and
Assumption Agreement nor any other document related to the consummation of the Contemplated
Transactions shall constitute a sale, assignment, assumption, transfer, conveyance or delivery or
an attempted sale, assignment, assumption, transfer, conveyance or delivery of the Restricted
Material Contracts, and following the Closing, the Seller Parties shall use Best Efforts, with
respect to which Buyer will cooperate with Sellers (provided that Buyer shall not be required to
incur any material expense or liability or agree to any material amendment or modification in
connection therewith), to obtain the Material Consent relating to each Restricted Material Contract
as quickly as practicable. Pending the obtaining of such Material Consents relating to any
Restricted Material Contract, the parties shall cooperate with each other in any reasonable and
lawful arrangements designed to provide to Buyer the benefits of use of the Restricted Material
Contract for its term, including a transfer agreement or arrangement between Sellers and Buyer
whereby Buyer obtains the benefits thereof at no mark-up or cost above the contract cost paid by
Sellers (and/or any right or benefit arising thereunder, including the enforcement for the benefit
of Buyer of any and all rights of Sellers
against a third party thereunder [***]. Once a
Material Consent for the sale, assignment, assumption, transfer, conveyance and delivery of a
Restricted Material Contract is obtained, which Material Consent shall be reasonably satisfactory
to Buyer, Sellers shall promptly assign, transfer, convey and deliver such Restricted Material
Contract to Buyer, and Buyer shall assume the obligations under such Restricted Material Contract
assigned to Buyer from and after the date of assignment to Buyer pursuant to a special-purpose
assignment and assumption agreement substantially similar in terms to those of the Assignment and
Assumption Agreement (which special-purpose agreement Buyer shall prepare and the parties shall
execute and deliver in good faith at the time of such transfer, all at no additional cost to
Buyer).

          (b) If there are any Consents not listed on Schedule 7.3 necessary for the assignment and
transfer of any Company Contracts to Buyer (the “Nonmaterial Consents”) which have not yet been
obtained (or otherwise are not in full force and effect) as of the Closing, Buyer shall elect at
the Closing, in the case of each of the Company Contracts as to which such Nonmaterial Consents
were not obtained (or otherwise are not in full force and effect) (the “Restricted Nonmaterial
Contracts”), whether to:

               (i) accept the assignment of such Restricted Nonmaterial Contract, in which case, as between
Buyer and Sellers, such Restricted Nonmaterial Contract shall, to the maximum extent practicable
and notwithstanding the failure to obtain the applicable Nonmaterial Consent, be transferred at the
Closing pursuant to the Assignment and Assumption Agreement as elsewhere provided under this
Agreement; or

               (ii) reject the assignment of such Restricted Nonmaterial Contract, in which case,
notwithstanding Sections 2.1 and 2.4, (A) neither this Agreement nor the Assignment and Assumption
Agreement nor any other document related to the consummation of the Contemplated Transactions shall
constitute a sale, assignment, assumption, conveyance or delivery or an attempted sale, assignment,
assumption, transfer, conveyance or delivery of such Restricted

THE
SYMBOL [***] IS USED TO INDICATE THAT A PORTION OF THE EXHIBIT HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTION.

28

 

EXECUTION VERSION

Nonmaterial Contract, and (B)
Sellers shall retain such Restricted Nonmaterial Contract (which shall be a Retained Liability) and
all Liabilities arising therefrom or relating thereto.

     2.11 ESCROW

          (a) On the Closing Date, the parties agree that Buyer shall deposit Seventeen million five
hundred thousand Dollars ($17,500,000) (the “Escrow Amount”) in an interest-bearing escrow account
for a period of twelve (12) months following Closing (“Escrow Period”) in order to partially secure
the indemnification obligations of the Seller Parties under Section 11 hereof, together with the
earnings thereon (the “Escrow Fund”) at The Fifth Third Bank, N.A. (“Escrow Agent”), which shall
serve as escrow agent pursuant to an escrow agreement in the form attached hereto as Exhibit T
(“Escrow Agreement”). All costs, fees, charges and expenses assessed by Escrow Agent to maintain
the escrow account as required hereunder, and any and all penalties, obligations, and liabilities
associated therewith or arising therefrom shall be shared equally (one half each) respectively by
the Company and Buyer. At the end of the Escrow Period, any amounts remaining (i) after the
payment and satisfaction of any and all indemnification claims under Section 11, and (ii) net of
any amounts held back for the purposes of pending claims, shall be distributed to the Seller
Representative. All earnings and interest accrued on the Escrow Fund shall remain in the
Escrow Fund until termination of the escrow, and released, subject to any pending claims, to
the Seller Parties. The Escrow Agent shall manage and disburse the contents of the Escrow Fund in
accordance with the terms and conditions of the Escrow Agreement and this Section 2.11.

3. Representations and Warranties of Seller and Shareholders

Seller Parties (other than VB and MB) represent and warrant, jointly and severally and as between
MB and VB, each of them represent and warrant severally, to Buyer, except as set forth in the
specific section(s) of the Disclosure Schedule, as follows:

     3.1 ORGANIZATION AND GOOD STANDING

          (a) Schedule 3.1(a) contains a complete and accurate list of Company’s and Suzhou’s
jurisdiction of incorporation or formation and any other jurisdictions in which either of them is
qualified to do business as a foreign corporation, organization or association. Company, Suzhou and
E122, respectively, are a corporation, a wholly foreign owned enterprise and a limited liability
company and each is duly organized or formed, validly existing and in good standing under the laws
of its jurisdiction of incorporation or formation, with full corporate and company power and
authority to conduct its respective business as it is now being conducted, to own or use the
properties and assets that it purports to own or use, and to perform all its obligations under the
Company Contracts. Each Seller is duly qualified to do business as a foreign corporation or other
entity and is in good standing under the laws of each state or other jurisdiction in which either
the ownership or use of the properties owned or used by it, or the nature of the activities
conducted by it, requires such qualification.

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

29

 

EXECUTION VERSION

          (c) Company has two (2) Subsidiaries as disclosed in Schedule 3.1(c), and except as disclosed
on Schedule 3.1(c) does not own any shares of capital stock or other equity or ownership interest
of any other Person.

          (d) Except as described on Schedule 3.1(d), neither Shareholder nor any Related Person owns or
has any interest or business relationship, whether as shareholder, member, partner, owner, manager,
consultant, broker, agent, advisor, with (i) any Person or Related Person or (ii) any interest in
any intellectual property interest or right, in either case, similar or related to the Business or
any business that is engaged in buying goods or services from or providing goods and services to,
the Business.

     3.2 ENFORCEABILITY; AUTHORITY; NO CONFLICT

          (a) This Agreement constitutes the legal, valid and binding obligation of each Seller Party,
enforceable against each of them in accordance with its terms. Upon the execution and delivery,
respectively, by Seller Parties of the Escrow Agreement, the Guarantees, the Noncompetition
Agreement and each other agreement, document or instrument to be executed or delivered,
respectively, by any or all of Seller Parties at the Closing (collectively, the “Seller Parties’
Closing Documents”), each of Seller Parties’ Closing Documents will constitute the legal, valid and
binding obligation of each such Seller Party, respectively, enforceable against each of them in
accordance with its terms. Each Seller Party has the absolute and unrestricted right, power
and authority to execute and deliver this Agreement and the Seller Parties’ Closing Documents to
which it is a party and to perform its obligations under this Agreement and the Seller Parties’
Closing Documents, and such action has been duly authorized by all necessary action by each
Seller’s shareholders, members, board of directors and managers, respectively. The board of
directors, shareholder and member actions, respectively, of each Seller signing this Agreement and
the transactions contemplated hereby were duly taken on August 28, 2006, certified copies of which
actions are attached hereto as Schedule 3.2(a), none of which shall have been rescinded or modified
as of the Effective Time. Each Shareholder has all necessary legal capacity to enter into this
Agreement and the Seller Parties’ Closing Documents to which such Shareholder is a party and to
perform her obligations hereunder and thereunder.

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

               (i) Breach (A) any provision of any of the Governing Documents of any Seller or (B) any
resolution adopted, respectively, by the board of directors, the shareholders, managers or members
of any Seller;

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

               (iii) contravene, conflict with or result in a violation or breach of any of the terms or
requirements of, or give any Governmental Body the right to revoke, withdraw, suspend,

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EXECUTION VERSION

cancel,
terminate or modify, any Governmental Authorization that is held by any Seller Party or that
otherwise relates to the Assets or to the business of either Seller;

               (iv) cause Buyer to become subject to, or to become liable for the payment of, any Tax;

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

               (vi) result in the imposition or creation of any Encumbrance upon or with respect to any of
the Assets.

          (c) Except as set forth in Schedule 3.2(c), no Seller nor either Shareholder is required to
give any notice to or obtain any Consent from any Person in connection with the execution and
delivery of this Agreement or the consummation or performance of any of the Contemplated
Transactions, including but not limited to the transfer to Buyer of any Governmental Authorization
listed on Schedule 3.2(c) or the transfer to Buyer of any Acquired Contract.

          (d) This Agreement and the Contemplated Transactions related hereto are of benefit to the
Shareholders and constitute adequate consideration for their respective agreements herein and as
contemplated hereby.

     3.3 CAPITALIZATION

          (a) The authorized equity securities of Company consist of one hundred (100) shares of common
stock, par value one dollar ($1.00) per share, of which seventy-five (75) shares are issued and
outstanding. MB owns 35 common shares of Company, representing 46.67% of the issued and
outstanding voting common shares of the Company and 50% of the issued and outstanding voting units
of E122. VB owns 34 common shares of Company, representing 45.34% of the issued and outstanding
voting common shares of the Company and 50% of the issued and outstanding voting units of E122.
Shareholders are and will be on the Closing Date the record and beneficial owners and holders of
such shares and units owned by each of them, free and clear of all Encumbrances which together will
constitute ninety-two (92%) percent of the voting stock of the Company and one hundred (100%)
percent of the voting units of E122 on the Closing Date. Except as set forth on Schedule 3.3(a),
there are no Contracts relating to the issuance, sale or transfer of any equity securities or other
securities of either Company or E122.

          (b) The Company owns 100% of the voting and other equity interests of Suzhou. There are no
Contracts relating to the issuance, sale or transfer of any equity securities or other securities
of Suzhou.

     3.4 FINANCIAL STATEMENTS

     Company has delivered to Buyer: (a) a consolidated balance sheet of Company and Suzhou as at
December 31, 2005 (including the notes thereto, the “2005 Year End Balance Sheet”), and the related
statements of income, changes in shareholders’ equity and cash flows for the fiscal year then

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EXECUTION VERSION

ended, including in each case the notes thereto, together with the compilation reports therein of
Battelle & Battelle LLP; (b) consolidated balance sheets of Company and Suzhou as at December 31st
in each of the fiscal years 2003 through 2004, and the related statements of income, changes in
shareholders’ equity and cash flows for each of the fiscal years then ended, including in each case
the notes thereto together with the compilation reports therein of Hoover & Roberts, Inc.,
independent certified public accountants; (c) an unaudited consolidated balance sheet of Company
and Suzhou as at June 30, 2006, (the “Interim Balance Sheet”) and the related unaudited
statement[s] of income, [changes in shareholders’ equity, and cash flows] for the six (6) months
then ended, and (d) the Carve-Out Financial Statements, including in each of the foregoing (a)-(d)
the notes thereto and certified by Company’s controller. Such financial statements fairly present
(and the financial statements delivered pursuant to Section 5.8 will fairly present) the financial
condition and the results of operations, changes in shareholders’ equity and cash flows of Company
and Suzhou as at the respective dates of and for the periods referred to in such financial
statements, and with respect to the Carve-Out Financials, the Assets and related results of
operations of the Business, with respect to the Carve-Out Financial Statements only, such financial
statements are in accordance with GAAP, except for the GAAP Exceptions, consistently applied. The
Estimated Closing Asset Value was prepared in accordance with GAAP, except for the GAAP Exceptions,
consistently applied and consistently with the balance sheet included on the
Carve-out Financial Statements. The Closing Asset Value will be prepared in accordance with GAAP,
except for the GAAP Exceptions, consistently applied and consistently with the Estimated Asset
Value and the balance sheet included in the Carve-Out Financial Statements. The financial
statements referred to in this Section 3.4 and delivered pursuant to Section 5.8 reflect and will
reflect the consistent application of such accounting principles throughout the periods involved,
except as disclosed in the notes to such financial statements. The financial statements have been
and will be prepared from and are in accordance with the accounting Records of Company and Suzhou.
Company has also delivered to Buyer copies of all letters from Company’s or Suzhou’s auditors to
Company’s or Suzhou’s management, board of directors, any committee or management thereof during
the thirty-six (36) months preceding December 31, 2005, together with copies of all responses
thereto.

     3.5 BOOKS AND RECORDS

     The books of account and other financial Records of Company and Suzhou, all of which have been
made available to Buyer, are complete and correct in all material respects and represent actual,
bona fide transactions and have been maintained in accordance with sound business practices
including the maintenance of an adequate system of internal controls. The minute books of Company
and Suzhou, all of which have been made available to Buyer, contain accurate and complete Records
of all material corporate actions taken by, the shareholders, the board of directors and committees
of the board of directors of Company or Suzhou, and no meeting of any such shareholders, board of
directors or committee has been held for which minutes have not been prepared or are not contained
in such minute books.

     3.6 SUFFICIENCY OF ASSETS

     (a) Except as set forth in Schedule 3.6, the Assets (i) constitute all of the assets, tangible
and intangible, of any nature whatsoever, necessary to operate the Business in the manner presently
operated by Company or Suzhou, or otherwise relating to, or used in, the conduct of the Business as
previously conducted by the Company or Suzhou, (ii) except for the Excluded Assets,

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EXECUTION VERSION

include all of
the assets owned or used by Company or Suzhou, (iii) include all of the intellectual property
rights and assets necessary to conduct the Business in the manner presently operated by Company or
Suzhou, free of any infringement or claim thereof and (iv) except for the Excluded IP constitute
all of the intellectual property rights and assets owned or used by the Company or Suzhou.

          (b) Each of the lists of Assets and Excluded Assets and each of the Disclosure Schedules
attached hereto which expressly purport to separately identify or allocate assets (by way of
example, the lists of Acquired Contracts and the Lists of Company Contracts and the list of
Intellectual Property Assets and the list of Excluded IP) (i) taken together disclose all the
assets, properties or rights owned or held by Sellers in both the Business and the Retained
Business and (ii) correctly list, include and/or allocate, respectively, all such items related to
or used in the Business, in the Assets being acquired by Buyer or to the Retained Business and the
Excluded Assets, being retained by the Sellers.

          (c) None of the Excluded Assets or any other assets, properties or rights of any Seller Party
(not included in the Included Assets) are related to, used in or shared with the Business,
except that certain Excluded Assets used by Company after the Effective Time to the extent
permitted by the Non-Competition Agreement may in that regard be “related to” the Business.

     3.7 DESCRIPTION OF OWNED REAL PROPERTY

     Schedule 3.7 contains a correct legal description, street address and tax parcel
identification number of all Real Property.

     3.8 DESCRIPTION OF LEASED REAL PROPERTY

     Schedule 3.8 contains a correct legal description, street address and tax parcel
identification number of all tracts, parcels and subdivided lots in which any Seller has a
leasehold interest and an accurate description (by location, name of lessor, date of Lease, term
expiry date and all amendments, if any) of all Real Property Leases.

     3.9 TITLE TO ASSETS; ENCUMBRANCES

          (a) Company, Suzhou, or with respect to Franklin Street Property, E122, each owns good and
marketable title to its respective estates in the Real Property, free and clear of any
Encumbrances, other than:

               (i) liens for real property Taxes for the current tax year which are not yet due and payable;
and

               (ii) those described in Schedule 3.9(a) (“Real Estate Encumbrances”).

          (b) True and complete copies of (i) all deeds, existing title insurance policies and surveys
of or pertaining to the Real Property identified in Schedule 3.7 and (ii) all instruments,
agreements and other documents evidencing, creating or constituting any Real Estate Encumbrances
have been delivered to Buyer. Seller Parties warrant to Buyer that, as of the Effective Time, the
Real Property shall be free and clear of all Encumbrances other than those Real Estate Encumbrances
identified on Schedule 3.9(b) as acceptable to Buyer (“Permitted Real Estate Encumbrances”).

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EXECUTION VERSION

          (c) Company, Suzhou and E122, respectively, own good and marketable title to all of the other
Assets free and clear of any Encumbrances other than those described in Schedule 3.9(c) (“Non-Real
Estate Encumbrances”). Company, Suzhou and E122, respectively, warrant to Buyer that, as of the
Effective Time, all other Assets shall be free and clear of all Encumbrances other than those
Non-Real Estate Encumbrances identified on Schedule 3.9(c) as acceptable to Buyer (“Permitted
Non-Real Estate Encumbrances” and, together with the Permitted Real Estate Encumbrances, “Permitted
Encumbrances”).

          (d) A true and complete copy, with all amendments, of the Construction Agreement is attached
to Schedule 3.9(d). There is no breach or default, or to any Seller Party’s Knowledge, alleged
breach or default, by any party, with respect to the Construction Agreement. The Company has
obtained all necessary Governmental Authorizations with respect to the improvements contemplated by
the Construction Agreement, and the improvements, as contemplated thereby, will comply with all
Legal Requirements when built in accordance therewith.

     3.10 CONDITION OF FACILITIES

          (a) Use of the Real Property for the various purposes for which it is presently being used,
and as it is contemplated being used upon completion of the Improvements pursuant to the
Construction Agreement, is permitted as of right under, and is in compliance with, all applicable
zoning Legal Requirements and is not subject to “permitted nonconforming” use or structure
classifications. All Improvements are in compliance with all applicable Legal Requirements,
including those pertaining to zoning, building and the disabled, are in good repair and in good
condition, and are free from patent and, to any Seller Party’s Knowledge, latent defects. Except
for the Permitted Encumbrances, there are no contractual or legal restrictions to which any Seller
is a party or, to any Seller Party’s Knowledge, by which any Real Property is otherwise bound that
preclude or restrict the ability of any Seller which owns, leases or otherwise uses such Real
Property to use such Real Property for the purposes for which it is currently being used. There
are no condemnation, environmental, zoning or other land-use regulation proceedings pending or to
any Seller Party’s Knowledge threatened in connection with any Real Property, and there are not any
special assessment proceedings pending or to any Seller Party’s Knowledge threatened which affect
any Real Property. No part of any Improvement encroaches on any real property not included in the
Real Property, and there are no buildings, structures, fixtures or other Improvements primarily
situated on adjoining property which encroach on any part of the Land. The Land for each owned
Facility abuts on and has direct vehicular access to a public road or has access to a public road
via a permanent, irrevocable, appurtenant easement benefiting such Land and comprising a part of
the Real Property, is supplied with public utilities and other services appropriate for the
operation of the Facilities located thereon and except as set forth on Schedule 3.10(a), is not
located within any flood plain or area subject to wetlands regulation or any similar restriction.
There is no existing or, to any Seller Party’s Knowledge, proposed plan to modify or realign any
street or highway or any existing or to any Seller Party’s Knowledge proposed eminent domain
proceeding that would result in the taking of all or any part of any Facility or that would prevent
or hinder the continued use of any Facility as heretofore used in the conduct of the business of
Company.

          (b) Each item of Tangible Personal Property is (i) in good repair and good operating
condition, (ii) is suitable for immediate use in the Ordinary Course of Business and (iii) is free
from latent and patent defects, (iv) operates within or satisfies manufacturing specifications for

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EXECUTION VERSION

operating rates, tolerances and other requirements, and (v) is not subject to any claim for
material breach of warranty or defect. No item of Tangible Personal Property is in need of repair
or replacement other than as part of routine maintenance in the Ordinary Course of Business. Except
as disclosed in Schedule 3.10(b) and all Tangible Personal Property used in either Company’s or
Suzhou’s business is in the possession of Company or Suzhou. Each of the silicon growers owned or
operated by Company (i) is described on Schedule 3.10(b) and (ii) is currently operating and
producing the yields at the diameters shown on Schedule 3.10(b), all in accordance with
manufacturer’s operating and technical specification shown on Schedule 3.10(b) (the “Current
Production Output Requirements”). All facilities and manufacturing processes of Company and Suzhou
are in accordance with applicable industry standards and certifications and all proprietary
customer quality requirements, in all material respects, as described on Schedule 3.10(b) (the
“Processes & Facilities Standards”). None of the Seller Parties have received any notice of any
material violation, deficiency or non-compliance with any Processes & Facilities Standard since
January 1, 2003. No tangible personal property of Company, E122, Suzhou or any Shareholder or any
of their respective Related Persons is shared between the Camden Road Property and the
Franklin Street Property or has, except as set forth in Schedule 3.10(b) been moved or
transferred between such facilities in the last twelve (12) months.

     3.11 ACCOUNTS RECEIVABLE; CUSTOMER REVENUES

          (a) All Accounts Receivable that are reflected on the balance sheet included in the Carve-Out
Financial Statements, Interim Balance Sheet or existing as of the Closing Date with respect to the
Business represent or will represent valid obligations arising from sales actually made or services
actually performed by Seller in the Ordinary Course of Business. There is no contest, claim,
defense or right of setoff, other than returns in the Ordinary Course of Business of Company or
Suzhou, with any such account debtor of an Account Receivable relating to the amount or validity of
such Account Receivable. Schedule 3.11(a) contains a complete and accurate list of all Accounts
Receivable as of the date of the Interim Balance Sheet, relating to the Business, which list sets
forth the aging of each such Account Receivable.

          (b) The largest ten (10) customers relating to the Business (other than Buyer) for (i) the six
(6) months ended 6/30/06 and (ii) twelve (12) months ended 12/31/05, respectively, with the sales
revenues, net of any returns or allowances, are set forth on Schedule 3.11(b), including net sales
for each customer, respectively, for such periods, and broken down in each case for such sales
related to the Business and for sales other than related to the Business (in the latter case, with
a brief description of such other business or products).

     3.12 INVENTORIES

     All items included in the Inventories consist of a quality and quantity usable and, with
respect to finished goods, saleable, in the Ordinary Course of Business of Company or Suzhou, as
the case may be, except for obsolete items and items of below-standard quality, all of which have
been written off or written down to net realizable value in the Estimated Closing Asset Value.
Neither Company nor Suzhou is in possession of any inventory not owned by it, including goods
already sold. All of the Inventories have been valued at the lower of cost or market value on a
first in, first out basis. Inventories now on hand that were purchased after the date of the
Carve-Out Financial Statements were purchased in the Ordinary Course of Business of Company or
Suzhou, as

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EXECUTION VERSION

the case may be, at a cost not exceeding market prices prevailing at the time of
purchase. The quantities of each item of Inventories (whether raw materials, work-in-process or
finished goods) are not excessive but are reasonable in the present circumstances of Company or
Suzhou, as the case may be. All Inventories are now valued, and will be valued on the Closing Date,
according to GAAP, except for the GAAP Exceptions, consistently applied.

     3.13 NO UNDISCLOSED LIABILITIES

     Except as set forth in Schedule 3.13, neither Company nor Suzhou has, and as of the Closing
Date will have, any Liability except for Liabilities reflected or reserved against in the balance
sheet included in the Carve-Out Financial Statement, Closing Balance Sheet or the Interim Balance
Sheet and current liabilities incurred in the Ordinary Course of Business of Company or Suzhou, as
the case may be, since the date of the Interim Balance Sheet, respectively, as of the dates of each
such balance sheet and the Closing Date.

     3.14 TAXES

          (a) Tax Returns Filed and Taxes Paid. Company and Suzhou have filed or caused to be filed on a
timely basis all Tax Returns and all reports with respect to Taxes that are or were required to be
filed pursuant to applicable Legal Requirements. All Tax Returns and reports filed by Company or
Suzhou are true, correct and complete in all material respects. Company and Suzhou have paid, or
made provision for the payment of, all Taxes that have or may have become due for all periods
covered by the Tax Returns or otherwise, or pursuant to any assessment received by Company or
Suzhou, except such Taxes, if any, are listed in Schedule 3.14(a) and are being contested in good
faith and as to which adequate reserves (determined in accordance with historical practices of
Company or Suzhou, as the case may be, and industry standards) have been provided in the balance
sheet included in the Carve-Out Financial Statements. Except as provided in Schedule 3.14(a),
neither Company nor Suzhou currently is the beneficiary of any extension of time within which to
file any Tax Return. No claim has ever been made or, to the Knowledge of Seller Parties, is
expected to be made by any Governmental Body in a jurisdiction where Company or Suzhou does not
file Tax Returns that it is or may be subject to taxation by that jurisdiction. There are no
Encumbrances on any of the Assets that arose in connection with any failure (or alleged failure) to
pay any Tax, and no Seller Party has any Knowledge of any basis for assertion of any claims
attributable to Taxes which, if adversely determined, could result in any such Encumbrance.

          (b) Delivery of Tax Returns and Information Regarding Audits and Potential Audits. Company and
Suzhou have delivered or made available to Buyer copies of, and Schedule 3.14(b) contains a
complete and accurate list of, all Tax Returns filed since January 1, 1999. The federal and state
income or franchise or other applicable Tax Returns of Company and Suzhou have been audited,
respectively by the IRS or relevant state and foreign tax authorities or are closed by the
applicable statute of limitations for the taxable years set forth on Schedule 3.14(b). Schedule
3.14(b) contains a complete and accurate list of all Tax Returns of Company or Suzhou that have
been audited or are currently under audit and accurately describe any deficiencies or other amounts
that were paid or are currently being contested. To the Knowledge of each Seller Party, no
undisclosed deficiencies are expected to be asserted with respect to any such audit. All
deficiencies proposed as a result of such audits have been paid, reserved against, settled or are
being contested in good faith by appropriate proceedings as described in Schedule 3.14(b). Company
and Suzhou have delivered, or

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EXECUTION VERSION

made available to Buyer, copies of any examination reports,
statements or deficiencies or similar items with respect to such audits. Except as provided in
Schedule 3.14(b), no Seller Party has Knowledge that any Governmental Body is likely to assess any
additional taxes for any period for which Tax Returns have been filed. There is no dispute or claim
concerning any Taxes of Company or Suzhou either (i) claimed or raised by any Governmental Body in
writing or (ii) as to which any Seller Party has Knowledge. Schedule 3.14(b) contains a list of all
Tax Returns for which the applicable statute of limitations has not run. Except as described in
Schedule 3.14(b), neither Company nor Suzhou has given or been requested to give waivers or
extensions (or is or would be subject to a waiver or extension given by any other Person) of any
statute of limitations relating to the payment of Taxes of Company or Suzhou or for which Company
or Suzhou may be liable.

          (c) Proper Accrual. The charges, accruals and reserves with respect to Taxes on the respective
Records of Company and Suzhou are adequate (determined in accordance with historical practices of
Company or
Suzhou, as the case may) and are at least equal to Company’s and Suzhou’s respective liability for
Taxes. To the Knowledge of each Seller Party, there exists no proposed tax assessment or deficiency
against Company or Suzhou.

          (d) Specific Potential Tax Liabilities and Tax Situations.

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

               (ii) Tax Sharing or Similar Agreements. There is no tax sharing agreement, tax allocation
agreement, tax indemnity obligation or similar written or unwritten agreement, arrangement,
understanding or practice with respect to Taxes (including any advance pricing agreement, closing
agreement or other arrangement relating to Taxes).

               (iii) Consolidated Group. Neither Company nor Suzhou (A) has been a member of an affiliated group
within the meaning of Code Section 1504(a) (or any similar group defined under a similar provision
of state, local or foreign law) and (B) has any liability for Taxes of any person (other than
Company, Suzhou or their respective Subsidiaries) under Treas. Reg. sect. 1.1502-6 (or any similar
provision of state, local or foreign law), as a transferee or successor by contract or otherwise.

               (iv) S Corporation. Company is, and has been since July 1, 1994, an S corporation as defined in
Code Section 1361.

               (v) Substantial Understatement Penalty. Company and Suzhou have disclosed on their respective Tax
Returns all positions taken therein that could give rise to a substantial understatement of federal
income Tax within the meaning of Code Section 6662 (or any similar provision of state, local or
foreign law).

     3.15 NO MATERIAL ADVERSE CHANGE

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EXECUTION VERSION

     Except as set forth on Schedule 3.15, since December 31, 2005, there has not been any material
adverse change in the Business, operations, prospects, assets, results of operations or condition
(financial or other) of Company or Suzhou related to or affecting, directly or indirectly, the
Business, and to the Knowledge of Seller Parties no event has occurred or circumstance exists that
is reasonably likely to result in such a material adverse change.

     3.16 EMPLOYEE BENEFITS

          (a) Set forth in Schedule 3.16(a) is a complete and correct list of all “employee benefit
plans” as defined by Section 3(3) of ERISA, all fringe benefit plans as defined in Section 6039D of
the Code, and all other bonus, incentive-compensation, deferred-compensation, profit-sharing,
stock-option, stock-appreciation-right, stock-bonus, stock-purchase, employee-stock-ownership,
savings, severance, change-in-control, supplemental-unemployment, layoff, salary-continuation,
retirement, pension, health, life-insurance, disability, accident, group-insurance, vacation,
holiday, sick-leave, fringe-benefit or welfare plan or arrangement, and any other employee
compensation or benefit plan, agreement, policy, practice, commitment, contract or understanding
(whether qualified or nonqualified, currently effective or terminated, written or unwritten) and
any trust, escrow or other agreement related thereto that (i) is maintained or contributed to by
Company or any other corporation or trade or business controlled by, controlling or under common
control with Company (within the meaning of Section 414 of the Code or Section 4001(a)(14) or
4001(b) of ERISA) (“ERISA Affiliate”) or has been maintained or contributed to in the last six (6)
years by Company or any ERISA Affiliate, or with respect to which Company or any ERISA Affiliate
has or may have any liability, and (ii) provides benefits, or describes policies or procedures
applicable to any current or former director, officer, employee or service provider of Company or
any ERISA Affiliate, or the dependents of any thereof, regardless of how (or whether) liabilities
for the provision of benefits are accrued or assets are acquired or dedicated with respect to the
funding thereof (collectively the “Employee Plans”). Schedule 3.16(a) identifies as such any
Employee Plan that is (v) a “Defined Benefit Plan” (as defined in Section 414(j) of the Code); (w)
a plan intended to meet the requirements of Section 401(a) of the Code; (x) a “Multiemployer Plan”
(as defined in Section 3(37) of ERISA); (y) a plan subject to Title IV of ERISA, other than a
Multiemployer Plan or (z) a plan subject to Section 412 of the Code other than a Defined Benefit
Plan or a Multiemployer Plan. Also set forth on Schedule 3.16(a) is a complete and correct list of
all ERISA Affiliates of Company during the last six (6) years.

          (b) Company has delivered to Buyer true, accurate and complete copies of (i) the documents
comprising each Employee Plan (or, with respect to any Employee Plan which is unwritten, a detailed
written description of eligibility, participation, benefits, funding arrangements, assets and any
other matters which relate to the obligations of Company or any ERISA Affiliate); (ii) all trust
agreements, insurance contracts or any other funding instruments related to the Employee Plans;
(iii) all rulings, determination letters, no-action letters or advisory opinions from the IRS, the
U.S. Department of Labor, the Pension Benefit Guaranty Corporation (“PBGC”) or any other
Governmental Body that pertain to each Employee Plan and any open requests therefor; and (iv) all
summary plan descriptions, summaries of material modifications and memoranda, employee handbooks
and other written communications regarding the Employee Plans.

          (c) The PBGC has not instituted or threatened a Proceeding to terminate or to appoint a
trustee to administer any of the Employee Plans pursuant to Subtitle 1 of Title IV of

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EXECUTION VERSION

ERISA, and no
condition or set of circumstances exists that presents a material risk of termination or partial
termination of any of the Employee Plans by the PBGC. None of the Employee Plans has been the
subject of, and no event has occurred or condition exists that could be deemed, a reportable event
(as defined in Section 4043 of ERISA) as to which a notice would be required (without regard to
regulatory monetary thresholds) to be filed with the PBGC. Company has paid in full all insurance
premiums due to the PBGC with regard to the Employee Plans for all applicable periods ending on or
before the Closing Date.

          (d) No Seller Party or any ERISA Affiliate has any liability or has Knowledge of any fact or
circumstance that might give rise to any liability, and the Contemplated Transactions will not
result in any liability, (i) for the termination of or withdrawal from any Employee Plan under
Sections 4062, 4063 or 4064 of ERISA, (ii) for any lien imposed under Section 302(f) of ERISA or
Section 412(n) of the Code, (iii) for any interest payments required under Section 302(e) of ERISA
or Section 412(m) of the Code, (iv) for any excise tax imposed by Section 4971 of the Code, (v) for
any minimum funding contributions under Section 302(c)(11) of ERISA or Section 412(c)(11) of the
Code or (vi) for withdrawal from any Multiemployer Plan under Section 4201 of ERISA.

          (e) The form of all Employee Plans is in compliance with the applicable terms of ERISA, the
Code, and any other applicable laws, including the Americans with Disabilities Act of 1990, the
Family Medical and Leave Act of 1993 and the Health Insurance Portability and Accountability Act of
1996, and such plans have been operated in compliance with such laws and the written Employee Plan
documents. Neither Company nor any fiduciary of an Employee Plan has violated the requirements of
Section 404 of ERISA. Except as set forth in Schedule 3.16(e), all required reports and
descriptions of the Employee Plans (including Internal Revenue Service Form 5500 Annual Reports,
Summary Annual Reports and Summary Plan Descriptions and Summaries of Material Modifications) have
been (when required) timely filed with the IRS, the U.S. Department of Labor or other Governmental
Body and distributed as required, and all notices required by ERISA or the Code or any other Legal
Requirement with respect to the Employee Plans have been appropriately given.

          (f) Each Employee Plan that is intended to be qualified under Section 401(a) of the Code has
received a favorable determination letter from the IRS, and no Seller Party has any Knowledge of
any circumstance that will or could result in revocation of any such favorable determination
letter. Each trust created under any Employee Plan has been determined to be exempt from taxation
under Section 501(a) of the Code, and Company is not aware of any circumstance that will or could
result in a revocation of such exemption.

          (g) Company has maintained workers’ compensation coverage as required by applicable state law
through purchase of insurance and not by self-insurance or otherwise except as disclosed on
Schedule 3.16(g).

          (h) No written or oral representations have been made to any employee or former employee of
Company promising or guaranteeing any employer payment or funding for the continuation of medical,
dental, life or disability coverage for any period of time beyond the end of the current plan year
(except to the extent of coverage required under COBRA). No written or oral representations have
been made to any employee or former employee of Company concerning the employee benefits of Buyer.

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EXECUTION VERSION

          (i) None of Sellers have ever participated in, contributed to, or otherwise been subject to
any Employee Plan that is a “Multiemployer Plan” within the meaning of Section 4001(a)(3) of ERISA.

     3.17 COMPLIANCE WITH LEGAL REQUIREMENTS; GOVERNMENTAL AUTHORIZATIONS

          (a) Except as set forth in Schedule 3.17(a):

               (i) each Seller is, and at all times since January 1, 2003, has been, in material compliance,
respectively, with each Legal Requirement that is or was applicable to it or to the conduct or
operation of its business or the ownership or use of any of its assets;

               (ii) no event has occurred or circumstance exists that (with or without notice or lapse of
time) (A) it is reasonable to expect may constitute or result in a violation by any Seller of, or a
failure on the part of any Seller to comply with, any Legal Requirement or (B) may give rise to any
obligation on the part of any Seller to undertake, or to bear all or any portion of the cost of,
any remedial action of any nature; and

               (iii) no Seller has received, at any time since January 1, 2003, any notice or other
communication (whether oral or written) from any Governmental Body or any other Person regarding
(A) any actual, alleged, possible or potential violation of, or failure to comply with, any Legal
Requirement or (B) any actual, alleged, possible or potential obligation on the part of any Seller
to undertake, or to bear all or any portion of the cost of, any remedial action of any nature.

          (b) Schedule 3.17(b) contains a complete and accurate list of each Governmental Authorization
that is held by each Seller (with respect to E122, with respect to the Franklin Street Property) or
that otherwise relates respectively to any Seller’s respective businesses or the Assets. Each
Governmental Authorization listed or required to be listed in Schedule 3.17(b) is valid and in full
force and effect. Except as set forth in Schedule 3.17(b):

               (i) each Seller is, and at all times since January 1, 2003, has been, in material compliance
with all of the terms and requirements of each Governmental Authorization identified or required to
be identified in Schedule 3.17(b);

               (ii) no event has occurred or circumstance exists that is reasonable to expect (with or
without notice or lapse of time) (A) constitute or result directly or indirectly in a violation of
or a failure to comply, in all material respects, with any term or requirement of any Governmental
Authorization listed or required to be listed in Schedule 3.17(b) or (B) result directly or
indirectly in the revocation, withdrawal, suspension, cancellation or termination of, or any
modification to, any Governmental Authorization listed or required to be listed in Schedule
3.17(b);

               (iii) no Seller has received, at any time since January 1, 2003, any notice or other
communication (whether oral or written) from any Governmental Body or any other Person regarding
(A) any actual, alleged, possible or potential violation of or failure to comply with any term or
requirement of any Governmental Authorization or (B) any actual, proposed, possible or potential
revocation, withdrawal, suspension, cancellation, termination of or modification to any
Governmental Authorization; and

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               (iv) all applications required to have been filed for the renewal of the Governmental
Authorizations listed or required to be listed in Schedule 3.17(b) have been duly filed on a timely
basis with the appropriate Governmental Bodies, and all other filings required to have
been made with respect to such Governmental Authorizations have been duly made on a timely
basis with the appropriate Governmental Bodies.

          (c) Except as set forth on Schedule 3.17(c), all of the Governmental Authorizations will be
transferred to Buyer pursuant hereto and as included in the Assets.

The Governmental Authorizations listed in Schedule 3.17(b) collectively constitute all of the
Governmental Authorizations necessary to permit Sellers to lawfully conduct and operate the
Business in the manner in which they currently conduct and operate such Business and to permit
Sellers to own and use their respective assets in the manner in which they currently own and use
such assets.

     3.18 LEGAL PROCEEDINGS; ORDERS

          (a) Except as set forth in Schedule 3.18(a), there is no pending or, to any Seller Party’s
Knowledge, threatened Proceeding by or against any Seller or that otherwise relates to or may
affect the Business, or any of the assets owned or used by, any Seller.

To the Knowledge of each Seller Party, no event has occurred or circumstance exists that is
reasonably likely to give rise to or serve as a basis for the commencement of any such Proceeding.
Each Seller has delivered to Buyer copies of all pleadings, correspondence and other documents
relating to each Proceeding listed in Schedule 3.18(a). There are no Proceedings listed or required
to be listed in Schedule 3.18(a) that could have a material adverse effect on the business, assets,
condition (financial or other) or prospects of any Seller or upon the Assets.

          (b) Except as set forth in Schedule 3.18(b):

               (i) there is no Order to which any Seller, the Business or any of the Assets is subject; and

               (ii) to the Knowledge of each Seller Party, no officer, director, agent, shareholder or
employee of any Seller is subject to any Order that prohibits such officer, director, agent,
shareholder or employee from engaging in or continuing any conduct, activity or practice relating
to the Business.

          (c) Except as set forth in Schedule 3.18(c):

               (i) each Seller is, and, at all times since January 1, 2003, has been in compliance with all
of the terms and requirements of each Order to which it, the Business or any of the Assets is or
has been subject;

               (ii) no event has occurred or circumstance exists that is reasonably likely to constitute or
result in (with or without notice or lapse of time) a violation of or failure to comply with any
term or requirement of any Order to which any Seller, the Business or any of the Assets is subject;
and

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               (iii) no Seller Party has received, at any time since January 1, 2003, any notice or other
communication (whether oral or written) from any Governmental Body or any other
Person regarding any actual, alleged, possible or potential violation of, or failure to comply
with, any term or requirement of any Order to which any Seller, the Business or any of the Assets
is or has been subject.

     3.19 ABSENCE OF CERTAIN CHANGES AND EVENTS

     Except as set forth in Schedule 3.19, since December 31, 2005, each Seller has conducted its
business only in the Ordinary Course of Business and there has not been any:

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

          (b) amendment to the Governing Documents of any Seller;

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

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

          (e) damage to or destruction or loss of any Asset, whether or not covered by insurance;

          (f) entry into, termination of or receipt of notice of termination of (i) any license,
distributorship, dealer, sales representative, joint venture, credit or similar Contract to which
any Seller is a party, or (ii) any Contract or transaction involving a total commitment by any
Seller of at least $50,000;

          (g) sale (other than sales of Inventories in the Ordinary Course of Business), lease or other
disposition of any Asset or property of any Seller (including the Intellectual Property Assets) or
the creation of any Encumbrance on any Asset;

          (h) cancellation or waiver of any claims or rights with a value to any Seller in excess of
$50,000;

          (i) communication, whether written or, to the knowledge of any Seller Party, oral, by any
customer or supplier of an intention to discontinue or materially change the terms of its
relationship with Company or Suzhou;

          (j) material change in the accounting methods used by Company or Suzhou; or

          (k) Contract by any Seller to do any of the foregoing.

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     3.20 CONTRACTS; NO DEFAULTS

          (a) Schedule 3.20(a) contains an accurate and complete list, and Company, Suzhou and, with
respect to the Franklin Street Property or the Business, E122 , have delivered to Buyer accurate
and complete copies, except as specifically contemplated below, (which Schedule separately
indicates and discloses which Contracts relate to the Business or Assets and which Contracts do not
relate to the Business or Assets), of:

               (i) each Company Contract that involves performance of services or delivery of goods or
materials by any Seller of an amount or value in excess of $50,000;

               (ii) each Company Contract that involves performance of services or delivery of goods or
materials to any Seller of an amount or value in excess of $50,000;

               (iii) each Company Contract that was not entered into in the Ordinary Course of Business and
that involves expenditures or receipts of any Seller in excess of $50,000;

               (iv) each Company Contract affecting the ownership of, leasing of, title to, use of or any
leasehold or other interest in any real or personal property (except personal property leases and
installment and conditional sales agreements having a value per item or aggregate payments of less
than $50,000 and with a term of less than one year);

               (v) each Company Contract with any labor union or other employee representative of a group of
employees relating to wages, hours and other conditions of employment;

               (vi) each Company Contract (however named) involving a sharing of profits, losses, costs or
liabilities by any Seller with any other Person;

               (vii) each Company Contract containing covenants that in any way purport to restrict any
Seller’s business activity or limit the freedom of any Seller to engage in any line of business or
to compete with any Person;

               (viii) each Company Contract with a value in excess of $50,000 providing for the
indemnification, hold harmless or defense by any Seller of any Person;

               (ix) each Company Contract with a value in excess of $50,000 providing for the nondisclosure
or maintenance of confidentiality by any Seller Party with respect to information (proprietary or
otherwise) of any Person;

               (x) each Company Contract providing for payments to or by any Person based on sales, purchases
or profits, other than direct payments for goods;

               (xi) each power of attorney of any Seller that is currently effective and outstanding;

               (xii) each Company Contract that contains or provides for an express undertaking by any Seller
to be responsible for consequential damages;

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EXECUTION VERSION

               (xiii) each Company Contract for capital expenditures in excess of $50,000;

               (xiv) each Company Contract not denominated in U.S. dollars that is valued in excess of
$50,000(USD);

               (xv) each written warranty, guaranty and/or other similar undertaking with respect to
contractual performance extended by any Seller and related to the Business; and

               (xvi) each amendment, supplement and modification (whether oral or written) in respect of any
of the foregoing.

Schedule 3.20(a) sets forth reasonably complete details concerning such Contracts, including the
parties to the Contracts, and with respect to Subsections (i) and (ii) above, the amount of the
remaining commitment of the respective Seller under the Contracts and the location of the
respective Seller’s office where details relating to the Contracts are located. Notwithstanding
the foregoing, disclosure with respect to the Retained Business is limited to the information
specified in Schedule 3.20(a).

          (b) Except as set forth in Schedule 3.20(b), neither Shareholder nor any other shareholder or
equity owner has or may acquire any rights under, and neither Shareholder nor any other shareholder
or equity owner has or may become subject to any obligation or liability under, any Contract that
relates to the business of any Seller, the Business or any of the Assets.

          (c) Except as set forth in Schedule 3.20(c):

               (i) each Contract identified or required to be identified in Schedule 3.20(a) and which is to
be assigned to or assumed by Buyer under this Agreement is in full force and effect and is valid
and enforceable in accordance with its terms;

               (ii) each Contract identified or required to be identified in Schedule 3.20(a) and which is
being assigned to or assumed by Buyer is assignable by the Seller that is party to such Contract to
Buyer without the consent of any other Person; and

               (iii) to the Knowledge of each Seller Party, no Contract identified or required to be
identified in Schedule 3.20(a) and which is to be assigned to or assumed by Buyer under this
Agreement will upon completion or performance thereof have a material adverse effect on the
business, assets, condition (financial or otherwise) or prospects of any Seller or the business to
be conducted by Buyer with the Assets.

          (d) Except as set forth in Schedule 3.20(d):

               (i) each Seller is, and at all times has been, in compliance with all applicable material
terms and requirements of each Contract which is being assumed by Buyer;

               (ii) each other Person that has or had any obligation or liability under any Contract which is
being assigned to Buyer is, and at all times has been, in compliance with all material terms and
requirements of such Contract;

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EXECUTION VERSION

               (iii) no event has occurred or circumstance exists that (with or without notice or lapse of
time) may contravene, conflict with or result in a Breach of, or give any Seller or other Person
the right to declare a default or exercise any remedy under, or to accelerate the maturity or
performance of, or payment under, or to cancel, terminate or modify, any Contract that is being
assigned to or assumed by Buyer;

               (iv) no event has occurred or circumstance exists under or by virtue of any Contract that
(with or without notice or lapse of time) would cause the creation of any Encumbrance affecting any
of the Assets other than the Permitted Encumbrances; and

               (v) no Seller has given to or received from any other Person, at any time, any notice or other
communication (whether oral or written) regarding any actual, alleged, possible or potential
violation or Breach of, or default under, any Contract which is being assigned to or assumed by
Buyer.

          (e) There are no renegotiations of, attempts to renegotiate or outstanding rights to
renegotiate any material amounts paid or payable to any Seller under current or completed Contracts
with any Person having the contractual or statutory right to demand or require such renegotiation
and no such Person has made written demand for such renegotiation.

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

     3.21 INSURANCE

          (a) Each Seller has made available to Buyer:

               (i) accurate and complete copies of all policies of insurance (and correspondence relating to
coverage thereunder) to which any Seller is a party or under which any Seller or any of the Assets
or Business is or has been covered at any time since January 1, 2003, a list of which is included
in Schedule 3.21(a); and

               (ii) accurate and complete copies of all pending applications by each Seller for policies of
insurance.

          (b) Schedule 3.21(b) describes:

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

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

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 EXECUTION VERSION

               (iii) all obligations of each Seller to provide insurance coverage to Third Parties (for
example, under Leases or service agreements) and identifies the policy under which such coverage is
provided.

          (c) Schedule 3.21(c) sets forth, by year, for the current policy year and each of the three
(3) preceding policy years:

               (i) a summary of the loss experience under each policy of insurance;

               (ii) except for workers’ compensation claims in the Ordinary Course of Business, a statement
describing each claim under a policy of insurance for an amount in excess of Ten Thousand Dollars
($10,000), which sets forth:

	 	(A)	 	the name of the claimant;
	 
	 	(B)	 	a description of the policy by
insurer, type of insurance and period of coverage; and
	 
	 	(C)	 	the amount and a brief
description of the claim; and

               (iii) a statement describing the loss experience for all claims that were self-insured, for
amounts in excess of Ten Thousand Dollars ($10,000) including the number and aggregate cost of such
claims.

          (d) Except as set forth in Schedule 3.21(d):

          (e) all policies of insurance to which any Seller is a party or that provide coverage to any
Seller:

	 	(A)	 	are valid, outstanding and enforceable; and
	 
	 	(B)	 	are sufficient for compliance, in
all material respects, with all Legal Requirements and
Contracts;

               (i) No Seller has received (A) any refusal of coverage or any notice that a defense will be
afforded with reservation of rights or (B) any notice of cancellation or any other indication that
any policy of insurance is no longer in full force or effect or that the issuer of any policy of
insurance is not willing or able to perform its obligations thereunder;

               (ii) Each Seller has paid all premiums due, and has otherwise performed all of its
obligations, under each policy of insurance to which it is a party or that provides coverage to it;
and

               (iii) Each Seller has given notice to the insurer of all claims involving over Ten Thousand
Dollars ($10,000) that may be insured thereby.

     3.22 ENVIRONMENTAL MATTERS

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     Except as disclosed in Schedule 3.22:

          (a) Each Seller is, and at all times has been, in compliance with, and has not been and is not
in violation of or liable under, any Environmental Law. No Seller Party has any basis to expect,
nor has any of them or any other Person for whose conduct they are or may be held to be responsible
received, any actual or threatened order, notice or other communication from (i) any Governmental
Body or private citizen acting in the public interest or (ii) the current or any prior owner or
operator of any Facilities, of any actual or potential violation or failure to comply with any
Environmental Law, or of any actual or threatened obligation to undertake or bear the cost of any
Environmental, Health and Safety Liabilities with respect to any Facility or other property or
asset (whether real, personal or mixed) in which any Seller has or had an interest, or with respect
to any property or Facility at or to which Hazardous Materials were generated, manufactured,
refined, transferred, imported, used or processed by any Seller or any other Person for whose
conduct it is or may be held responsible, or from which Hazardous Materials have been transported,
treated, stored, handled, transferred, disposed, recycled or received.

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

          (c) No Seller Party has any Knowledge of or any basis to expect, nor has any of them, or any
other Person for whose conduct they are or may be held responsible, received, any citation,
directive, inquiry, notice, Order, summons, warning or other communication that relates to
Hazardous Activity, Hazardous Materials, or any alleged, actual, or potential violation or failure
to comply with any Environmental Law, or of any alleged, actual, or potential obligation to
undertake or bear the cost of any Environmental, Health and Safety Liabilities with respect to any
Facility or property or asset (whether real, personal or mixed) in which any Seller has or had an
interest, or with respect to any property or facility to which Hazardous Materials generated,
manufactured, refined, transferred, imported, used or processed by either Seller or any other
Person for whose conduct it is or may be held responsible, have been transported, treated, stored,
handled, transferred, disposed, recycled or received.

          (d) No Seller nor any other Person for whose conduct any of them is or may be held responsible
has any Environmental, Health and Safety Liabilities with respect to any Facility or, to the
Knowledge of any Seller Party, with respect to any other property or asset (whether real, personal
or mixed) in which any Seller (or any predecessor) has or had an interest or at any property
geologically or hydrologically adjoining any Facility or any such other property or asset.

          (e) There are no Hazardous Materials (as presently defined as of the Effective Time) present
on or in the Environment at any Facility or at any geologically or hydrologically adjoining
property, including any Hazardous Materials contained in barrels, aboveground or underground
storage tanks, landfills, land deposits, dumps, impoundments, equipment (whether movable or fixed)
or other containers, either temporary or permanent, and deposited or located in land, water, sumps,
or any other part of the Facility or such adjoining property, or incorporated into any structure
therein or thereon, other than in compliance with applicable Environmental Laws. No

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Seller nor any Person for whose conduct any of them is or may be held responsible, or to the
Knowledge of any Seller Party, any other Person, has permitted or conducted, or is aware of, any
Hazardous Activity conducted with respect to any Facility or any other property or assets (whether
real, personal or mixed) in which any Seller has or had an interest except in compliance with all
applicable Environmental Laws, in all material respects.

          (f) There has been no Release or, to the Knowledge of any Seller Party, Threat of Release, of
any Hazardous Materials (as presently defined as of the Effective Time) at or from any Facility or
at any other location where any Hazardous Materials were generated, manufactured, refined,
transferred, produced, imported, used, processed from or by, or have come to be located on, any
Facility, or from any other property or asset (whether real, personal or mixed) in which any Seller
has or had an interest, or to the Knowledge of any Seller Party any geologically or hydrologically
adjoining property, whether by any Seller or any other Person, other than in compliance with
applicable Environmental Laws.

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

          (h) Other than as indicated or described in the materials delivered to Buyer as represented in
the preceding Section 3.22(g), there have been no investigations of the Environment at any of the
Real Property, the purpose of which was to discover, identify or otherwise characterize the
condition of the soil, groundwater, air, or presence of asbestos on the Real Property, during any
Seller’s ownership or occupancy of the Real Property.

          (i) Each Seller has all necessary Environmental Authorizations for all uses, discharges and
Facilities under all applicable Environmental Laws.

     3.23 EMPLOYEES

          (a) Schedule 3.23(a) contains a complete and accurate list of the following information for
each Active Employee (as hereinafter defined), director, independent contractor, consultant and
agent of Company and Suzhou, including each Active Employee on leave of absence or layoff status:
employer; location (Franklin Street Property or Suzhou New District, Suzhou, Jiangsu, PRC) name;
job title; date of hiring or engagement; date of commencement of employment or engagement; date of
commencement of leave of absence (if applicable) current compensation paid or payable and any
change in compensation since December 31, 2005; whether employment is pursuant to a written
contract (and a copy is attached as Schedule 3.23(a)), sick and vacation leave that is accrued but
unused; and service credited for purposes of vesting and eligibility to participate under any
Employee Plan, or any other employee or director benefit plan.

          (b) Schedule 3.23(b) contains a complete and accurate list of the following information for
each retired employee or director of Company or Suzhou, or their dependents, receiving benefits or
scheduled to receive benefits in the future: name; pension benefits; pension

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EXECUTION VERSION

option election; retiree medical insurance coverage; retiree life insurance coverage; and
other benefits.

          (c) Schedule 3.23(c) states the number of employees terminated by Company or Suzhou since
December 31, 2004, and contains a complete and accurate list of the following information for each
employee of Company or Suzhou who has been terminated or laid off, or whose hours of work have been
reduced by more than fifty percent (50%) by Company or Suzhou, in the six (6) months prior to the
date of this Agreement: (i) the date of such termination, layoff or reduction in hours; (ii) the
reason for such termination, layoff or reduction in hours; and (iii) the location to which the
employee was assigned.

          (d) Company has not violated the Worker Adjustment and Retraining Notification Act (the “WARN
Act”) or any similar state or local Legal Requirement. During the ninety (90) day period prior to
the date of this Agreement, Company has terminated two (2) employees.

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

          (f) Schedule 3.23(f) lists each employee of the Company engaged in production, manufacturing,
product development, engineering, research and development and/or operations. Each of the
employees listed on Schedule 3.23(f) have executed the Employee Developments Agreement and the
Employee Invention Rights Assignment, in the form attached to Schedule 3.23(f), and Buyer has been
provided copies of such executed employee agreements.

     3.24 LABOR DISPUTES; COMPLIANCE

          (a) Company and Suzhou have complied in all material respects with all Legal Requirements
relating to employment practices, terms and conditions of employment, equal employment opportunity,
nondiscrimination, immigration, wages, hours, benefits, collective bargaining and other
requirements, the payment of social security and similar Taxes and occupational safety and health.
Neither Company nor Suzhou is liable for the payment of any Taxes, fines, penalties, or other
amounts, however designated, for failure to comply with any of the foregoing Legal Requirements.

          (b) Except as disclosed in Schedule 3.24(b), (i) neither Company nor Suzhou has been, and is
not now, a party to any collective bargaining agreement or other labor contract; (ii) since July 1,
2001, there has not been, there is not presently pending or existing, and to Company’s, Suzhou’s
and each Shareholder’s Knowledge there is not threatened, any strike, slowdown, picketing, work
stoppage or employee grievance process involving Company or Suzhou; (iii) to Company’s, Suzhou’s
and each Shareholder’s Knowledge no event has occurred or circumstance exists that could

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provide the basis for any work stoppage or other labor dispute; (iv) there is not pending or,
to Company’s, Suzhou’s and each Shareholder’s Knowledge, threatened against or affecting Company or
Suzhou any Proceeding relating to the alleged violation of any Legal Requirement pertaining to
labor relations or employment matters, including any charge or complaint filed with the National
Labor Relations Board or any comparable Governmental Body, and there is no organizational activity
or other labor dispute against or affecting Company or Suzhou or the Facilities; (v) no application
or petition for an election of or for certification of a collective bargaining agent is pending;
(vi) no grievance or arbitration Proceeding exists that might have an adverse effect upon Company
or Suzhou or the conduct of its business; (vii) there is no lockout of any employees by Company or
Suzhou, and no such action is contemplated by Company or Suzhou; and (viii) to Company’s, Suzhou’s
and each Shareholder’s Knowledge there has been no charge of discrimination filed against or
threatened against Company or Suzhou with the Equal Employment Opportunity Commission or similar
Governmental Body.

     3.25 INTELLECTUAL PROPERTY ASSETS

          (a) The term “Intellectual Property Assets” means all intellectual property owned, or licensed
(as licensor or licensee) by Company or Suzhou, in which Company or Suzhou has a proprietary
interest or otherwise utilizes, related to the Business or used in the Business, all of which are
listed on Schedule 3.25(a), including:

               (i) except for the names “Bullen”, “Bullen Ultra-Sonics” and “Bullen Ultrasonics,” all other
names, marks, product names, assumed fictional business names, trade names, registered and
unregistered trademarks, service marks and applications (collectively, “Marks”);

               (ii) all patents, patent applications and inventions and discoveries that may be patentable
(collectively, “Patents”);

               (iii) all registered and unregistered copyrights in both published works and unpublished works
(collectively, “Copyrights”);

               (iv) all rights in mask works;

               (v) all know-how, trade secrets, confidential or proprietary information, customer lists,
Software, technical information, data, process technology, plans, drawings and blue prints
(collectively, “Trade Secrets”); and

               (vi) all rights to telephone and facsimile numbers as set forth on Schedule 3.25(a) in use at
the Franklin Street Property.

          (b) Schedule 3.25(b) contains a complete and accurate list and summary description, including
any royalties paid or received by Company or Suzhou, and Company and Suzhou have delivered to Buyer
accurate and complete copies, of all Company Contracts (including all licenses in effect as of the
date of this Agreement and those that have expired or been terminated within the previous five (5)
years) relating to the Intellectual Property Assets, except for any license implied by the sale of
a product and perpetual, paid-up licenses for commonly available Software programs with a value of
less than $5,000 under which Company or Suzhou is the licensee. All such Company Contracts are in
full force and effect. There are no outstanding and, to Company’s,

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Suzhou’s and each Shareholder’s Knowledge, no threatened disputes or disagreements with
respect to any such Contract.

          (c)      (i) Except as set forth in Schedule 3.25(c), the Intellectual Property Assets are all
those necessary for the operation of the Business as it is currently conducted and the manufacture,
marketing and sale of Company or Suzhou products and services. Company or Suzhou is the owner or
licensee of all right, title and interest in and to each of the Intellectual Property Assets, free
and clear of all Encumbrances, and has the right to use all of the Intellectual Property Assets,
without payment to a Third Party, either Shareholder or any Related Person, other than in respect
of licenses listed in Schedule 3.25(c).

               (ii) Except as set forth in Schedule 3.25(c), all former and current employees of Company or
Suzhou have executed written Contracts with Seller that assign to Company or Suzhou, as the case
may be, all rights to any inventions, improvements, discoveries or information relating to the
business of Company or Suzhou.

          (d)      (i) No Shareholder or Related Person owns or has any interest in any Patent related to or
affecting the Business, including any business or Person buying from or selling to the Business.
Schedule 3.25(d) contains a complete and accurate list and summary description of all Patents
including and designating each Patent that is included in the Excluded IP.

               (ii) All of the issued Patents are currently in compliance with all Legal Requirements
(including payment of filing, examination and maintenance fees and proofs of working or use), are
valid and enforceable, and are not subject to any maintenance fees or taxes or actions falling due
within ninety (90) days after the Closing Date.

               (iii) No Patent has been or is now involved in any interference, reissue, reexamination, or
opposition Proceeding. To Company’s, Suzhou’s and each Shareholder’s Knowledge, there is no
potentially interfering patent or patent application of any Third Party, Shareholder or Related
Person.

               (iv) Except as set forth in Schedule 3.25 (d), (A) no Patent is infringed or, to Company’s or
Suzhou’s Knowledge, has been challenged or threatened in any way and (B) none of the products
manufactured or sold, nor any process or know-how used, by Company or Suzhou infringes or is
alleged to infringe any patent or other proprietary right of any other Person, including any
Shareholder or Related Person.

               (v) All products made, used or sold under the Patents have been marked with the proper patent
notice.

          (e)      (i) Schedule 3.25(e) contains a complete and accurate list and summary description of all
Marks including and designating each Mark that is included in the Excluded IP. No Shareholder or
Related Person owns or has any interest in any Mark (other than “Bullen” and “Bullen Ultrasonic”)
related to or affecting the Business, including any business or Person buying from or selling to
the Business.

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EXECUTION VERSION

               (ii) None of the Marks included in the Intellectual Property Assets are federally registered.
All Marks included in the Intellectual Property Assets are valid and enforceable and do not
infringe on any right of any Person.

               (iii) No Mark included in the Intellectual Property Assets has been or is now involved in any
opposition, invalidation or cancellation Proceeding and, to Company’s, Suzhou’s and each
Shareholder’s Knowledge, no such action is threatened with respect to any of the Marks.

               (iv) To Company’s, Suzhou’s and each Shareholder’s Knowledge, there is no potentially
interfering trademark or trademark application of any Third Party, Shareholder or Related Person.

               (v) No Mark included in the Intellectual Property Assets is infringed or, to Company’s,
Suzhou’s and each Shareholder’s Knowledge, has been challenged or threatened in any way. None of
the Marks used by Seller infringes or to any Seller Party’s Knowledge is alleged to infringe any
trade name, trademark or service mark of any other Person.

          (f)      (i) Schedule 3.25(f) contains a complete and accurate list and summary description of all
Copyrights included in the Intellectual Property Assets including all Copyrights included in the
Excluded IP. No Shareholder or Related Person owns or has any interest in any copyright related to
or affecting the Business, including any business or Person buying from or selling to the Business.

               (ii) All of the registered Copyrights included in the Intellectual Property Assets are
currently in compliance with all Legal Requirements, are valid and enforceable, and are not subject
to any maintenance fees or taxes or actions falling due within ninety (90) days after the date of
Closing.

               (iii) No Copyright included in the Intellectual Property Assets is infringed or, to Company’s,
Suzhou’s and each Shareholder’s Knowledge, has been challenged or threatened in any way. None of
the subject matter of any of the Copyrights infringes or is alleged to infringe any copyright of
any Third Party, Shareholder or Related Person or is a derivative work based upon the work of any
other Person.

               (iv) All works encompassed by the Copyrights included in the Intellectual Property Assets have
been marked with the proper copyright notice.

          (g)      (i) With respect to each Trade Secret included in the Intellectual Property Assets, the
documentation relating to such Trade Secret is sufficient in accuracy, detail and content to
identify and explain it and to allow its full and proper use as presently practiced without
reliance on the knowledge or memory of any individual.

               (ii) Company and Suzhou have taken all reasonable precautions to protect the secrecy,
confidentiality and value of all Trade Secrets included in the Intellectual Property Assets,
(including the enforcement by Company and Suzhou of a policy generally requiring employees and
contractors to execute proprietary information and confidentiality

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EXECUTION VERSION

agreements substantially in Company’s standard form (a copy of which is attached in the
Schedule 3.25(g)), and those employees and contractors of Company or Suzhou who have executed such
an agreement are listed on Schedule 3.25(g)).

               (iii) Company or Suzhou have good title to and an absolute right to use the Trade Secrets
included in the Intellectual Property Assets. The Trade Secrets included in the Intellectual
Property Assets are not part of the public knowledge or literature and, to Company’s, Suzhou’s and
each Shareholder’s Knowledge, have not been used, divulged or appropriated either for the benefit
of any Person (other than Seller) or to the detriment of Company or Suzhou. No Trade Secret is
subject to any adverse claim or has been challenged or threatened in any way or infringes any
intellectual property right of any other Person. No Shareholder or Related Person owns or has any
interest in any trade secret related to or affecting the Business, including any business or Person
buying from or selling to the Business.

          (h)      (i) Schedule 3.25(h) contains a complete and accurate list and summary description of all
Domain Rights.

               (ii) All Domain Rights have been registered in the name of Company or Suzhou and are in
compliance with all formal Legal Requirements.

          (i) The term “Excluded IP” means all intellectual property owned or licensed (as licensor or
licensee) by Company or Suzhou, or in which Company or Suzhou has a proprietary interest, and which
is related solely to the Retained Business, all of which are listed and summarily described on
Schedule 3.25(i), including:

               (i) all Marks;

               (ii) all Patents;

               (iii) all Copyrights;

               (iv) all rights in mask works; and

               (v) all Trade Secrets

          (j) None of the Company’s or Suzhou’s products, processes, operations, services or
Intellectual Property Assets infringe or otherwise violate any right of any other Person.

     3.26 COMPLIANCE WITH THE FOREIGN CORRUPT PRACTICES ACT AND EXPORT CONTROL AND ANTIBOYCOTT
LAWS

          (a) Neither Company, its Subsidiaries, Related Persons or Representatives nor Suzhou (i) have,
to obtain or retain business, or affect any approval or action or obtain any unfair advantage,
directly or indirectly offered, paid or promised to pay, or authorized the payment of, any money or
other thing of value or any commission payment in excess of five percent (5%) of any amount payable
or (ii) have for any purpose whatsoever, offered, given or promised to give anything

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EXECUTION VERSION

with a value in excess of one hundred dollars ($100) in the aggregate to any one individual in
any year, to:

               (i) any person who is an official, officer, agent, employee or Representative of any
Governmental Body or of any existing or prospective customer (whether government owned or
nongovernment owned);

               (ii) any political party or official thereof;

               (iii) any candidate for political or political party office; or

               (iv) any other individual or entity;

               (v) while knowing or having reason to believe that all or any portion of such money or thing
of value would be offered, given, or promised, directly or indirectly, to any such official,
officer, agent, employee, representative, political party, political party official, candidate,
individual, or any entity affiliated with such customer, political party or official or political
office.

          (b) Except as set forth in Schedule 3.26(b), Company, Suzhou and their Related Persons have
made all payments to Third Parties by check mailed to such Third Parties’ principal place of
business or by wire transfer to a bank located in the same jurisdiction as such party’s principal
place of business.

          (c) Each transaction is properly and accurately recorded on the books and Records of Company
or Suzhou, and each document upon which entries in Company’s or Suzhou’s books and Records are
based is complete and accurate in all respects. Company and Suzhou each maintain a system of
internal accounting controls adequate to ensure that neither Company nor Suzhou maintains
off-the-books accounts and that Company’s and Suzhou’s assets are used only in accordance with
Company’s or Suzhou’s management directives.

          (d) Except as set forth on Schedule 3.26(d), Company, Suzhou and their Related Persons have at
all times been in compliance with all Legal Requirements relating to export control and trade
embargoes. Without limiting the generality of the foregoing sentence, except as set forth on
Schedule 3.26(d), (i) all exports and reexports by Company or Suzhou or their Related Persons of
all products, software, technology or services have been made in compliance with all Legal
Requirements, including all export licenses or other authorizations required under the United
States Export Administration Regulations; (ii) Company, Suzhou and their Related Persons have not,
directly or indirectly, exported, reexported, transferred or diverted any products, software,
technology or services to any country in violation of any Legal Requirement relating to trade
embargoes; and (iii) Company, Suzhou and their Related Persons have not, directly or indirectly,
during the last five (5) years exported, reexported, transferred or diverted any products,
software, technology or services to Cuba, Iran, Libya, North Korea, Sudan, Syria, Afghanistan, Iraq
or Serbia and Montenegro, nor to any Person that is a national or resident of any such country.

          (e) Except as set forth in Schedule 3.26(e), neither Company, Suzhou nor their Related Persons
have violated the antiboycott prohibitions contained in 50 U.S.C. App. sec. 2401 et seq. or 15 CFR
Part 760 or taken any action that can be penalized under Section 999 of the Code.

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EXECUTION VERSION

Except as set forth in Schedule 3.26(e), during the last five (5) years, neither Company,
Suzhou nor their Related Persons has been a party to, is not a beneficiary under and has not
performed any service or sold any product under any Company Contract under which a product has been
sold to customers in Bahrain, Kuwait, Lebanon, Libya, Oman, Qatar, Saudi Arabia, Syria, United Arab
Emirates or the Republic of Yemen.

     3.27 RELATIONSHIPS WITH RELATED PERSONS

     Except as disclosed in Schedule 3.27, no Seller nor any shareholder or member or any Related
Person of any of them has, or since December 31, 2004, has had, any interest in any property
(whether real, personal or mixed and whether tangible or intangible) used in or pertaining to
Company’s or Suzhou’s business. No Seller nor any shareholder or member or any Related Person of
any of them owns, or since December 31, 2004, has owned, of record or as a beneficial owner, an
equity interest or any other financial or profit interest in any Person that has (a) had business
dealings or a material financial interest in any transaction with Company or Suzhou except as set
forth and described in Schedule 3.27, each of which has been conducted in the Ordinary Course of
Business with Company or Suzhou at substantially prevailing market prices and on substantially
prevailing market terms or (b) engaged in competition with Company or Suzhou with respect to any
line of the products or services included in the Business (a “Competing Business”) in any market
presently served by Company or Suzhou, except for ownership of less than one percent (1%) of the
outstanding capital stock of any Competing Business that is publicly traded on any recognized
exchange or in the over-the-counter market. Except as set forth in Schedule 3.27, no Seller nor any
shareholder or member or any Related Person of any of them is a party to any Contract with, or has
any claim or right against, Company or Suzhou.

     3.28 BROKERS OR FINDERS

     No Seller Party nor any of their respective Representatives have incurred any obligation or
liability, contingent or otherwise, for brokerage or finders’ fees or agents’ commissions or other
similar payments in connection with the sale of any Seller’s business or the Assets or the
Contemplated Transactions, except for its agreement with Goldsmith, Agio, Helms & Lynner, LLC,
whose fees and expenses will be paid by Seller Parties.

     3.29 SOLVENCY

          (a) Neither Company nor Suzhou is now insolvent nor will be rendered insolvent by any of the
Contemplated Transactions. As used in this section, “insolvent” means that the sum of the debts and
other probable Liabilities of Company or Suzhou, as the case may be, exceeds the present fair
saleable value of Company’s or Suzhou’s, as the case may be, assets.

          (b) Immediately after giving effect to the consummation of the Contemplated Transactions: (i)
both Company and Suzhou will be able to pay their Liabilities as they become due in the usual
course of their respective businesses; (ii) neither Company nor Suzhou will have unreasonably small
capital with which to conduct its present or proposed business; (iii) both Company and Suzhou will
have assets (calculated at fair market value) that exceed its Liabilities; and (iv) taking into
account all pending and threatened litigation, final judgments against Company or Suzhou in actions
for money damages are not reasonably anticipated to be rendered at a time

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EXECUTION VERSION

when, or in amounts such that, Company or Suzhou will be unable to satisfy any such judgments
promptly in accordance with their terms (taking into account the maximum probable amount of such
judgments in any such actions and the earliest reasonable time at which such judgments might be
rendered) as well as all other obligations of Company or Suzhou, as the case may be. The cash
available to Company and Suzhou, after taking into account all other anticipated uses of the cash,
will be sufficient to pay all such debts and judgments promptly in accordance with their terms.

     3.30 DISCLOSURE

          (a) No representation or warranty or other statement made by any Seller or either Shareholder
in this Agreement, the Disclosure Schedule, any supplement to the Disclosure Schedule, the
certificates delivered pursuant to Section 2.7(a) or otherwise in connection with the Contemplated
Transactions contains any untrue statement or omits to state a material fact necessary to make any
of them, in light of the circumstances in which it was made, not misleading.

          (b) No Seller or either Shareholder has any Knowledge of any fact that has specific
application to any Seller (other than general economic or industry conditions) and that may
materially adversely affect the assets, business, prospects, financial condition or results of
operations of Company or Suzhou that has not been set forth in this Agreement or the Disclosure
Schedule.

     3.31 DISC

     Bullen DISC, Inc. is a domestic international sales corporation and is a wholly-owned
Subsidiary of Company, duly organized or formed, under the laws of Nevada and pursuant to Section
992 of the Code (“DISC”). DISC has no material assets, property, liabilities or operations other
than those described on Schedule 3.31. None of the Assets are owned or held by or ever have been
owned or held by DISC.

     3.32
[***]

     With respect to the Company’s obligations to [***], including any inability to fulfill or perform obligations that may
result from the condition described in Schedule 3.15 of the Disclosure Schedule [***]

          (a) The Company has, and Buyer will have, no special product priority or preference
obligations to either [***]

          (b) The Company has, and Buyer will have, no liability to [***] for any money damages,
including any incidental or consequential damages, or any monetary penalties;

          (c) Neither [***] have the contractual right to specifically enforce [***]

4. Representations and Warranties of Buyer

     Buyer represents and warrants to Seller Parties as follows:

THE
SYMBOL [***] IS USED TO INDICATE THAT A PORTION OF THE EXHIBIT HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTION.

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EXECUTION VERSION

     4.1 ORGANIZATION AND GOOD STANDING

     LRC is a corporation duly organized, validly existing and in good standing under the laws of
the State of Delaware, with full corporate power and authority to conduct its business as it is now
conducted. LRC China is a wholly foreign owned enterprise in the process of being formed under the
laws of the Peoples Republic of China and upon formation and satisfaction of the conditions set
forth in Section 7.15 will have full company power and authority to conduct its business.

     4.2 AUTHORITY; NO CONFLICT

          (a) This Agreement constitutes the legal, valid and binding obligation of each Buyer,
enforceable against each Buyer in accordance with its terms. Upon the execution and delivery by
each Buyer of the Assignment and Assumption Agreement, the Escrow Agreement, the Employment
Agreements, and each other agreement, document and instrument to be executed or delivered by Buyer
at Closing (collectively, the “Buyers’ Closing Documents”), each of the Buyers’ Closing Documents
will constitute the legal, valid and binding obligation, respectively, of each Buyer, enforceable
against each Buyer in accordance with its respective terms. Each Buyer has the absolute and
unrestricted, right, power and authority to execute and deliver this Agreement and the Buyers’
Closing Documents and to perform its respective obligations under this Agreement and the Buyers’
Closing Documents, and such action has been duly authorized by all necessary corporate action.

          (b) Neither the execution and delivery of this Agreement, any of Buyers’ Closing Documents, by
either Buyer nor the consummation or performance of any of the Contemplated Transactions by either
Buyer will give any Person the right to prevent, delay or otherwise interfere with any of the
Contemplated Transactions pursuant to:

               (i) any provision of either Buyer’s Governing Documents;

               (ii) any resolution adopted by the board of directors or the shareholders of either Buyer; or

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

     4.3 [INTENTIONALLY LEFT BLANK]

     4.4 BROKERS OR FINDERS

     Neither Buyer nor any of its Representatives have incurred any obligation or liability,
contingent or otherwise, for brokerage or finders’ fees or agents’ commissions or other similar
payment in connection with the Contemplated Transactions, except for its agreement with JPMorgan,
whose fees and expenses will be paid by Buyer.

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EXECUTION VERSION

     4.5 AVAILABLE FUNDS

     The cash available to Buyers after taking into account all anticipated uses, will be
sufficient to pay all amounts at Closing and consummate the contemplated transactions promptly in
accordance with their terms.

5. Covenants of Seller Prior to Closing

     5.1 ACCESS AND INVESTIGATION

     Between the date of this Agreement and the Closing Date, and upon reasonable advance notice
received from Buyer, Sellers shall and Shareholders shall cause Sellers to (a) afford Buyer and its
Representatives full and free access, during regular business hours, to Sellers’ personnel,
properties (including subsurface testing), Contracts, Governmental Authorizations, books and
Records and other documents and data, such rights of access to be exercised in a manner that does
not unreasonably interfere with the operations of Sellers; (b) furnish Buyer with copies of all
such Contracts, Governmental Authorizations, books and Records and other existing documents and
data as Buyer may reasonably request; (c) furnish Buyer with such additional financial, operating
and other relevant data and information as Buyer may reasonably request; and (d) otherwise
cooperate and assist, to the extent reasonably requested by Buyer, with Buyer’s investigation of
the properties, assets and financial condition related to Company or E122. In addition, Buyer
shall have the right to have the Real Property and Tangible Personal Property inspected, at Buyer’s
sole cost and expense, for purposes of determining the physical condition and legal characteristics
of the Real Property, Facilities and Tangible Personal Property. In the event subsurface or other
destructive testing is recommended based on any such inspection, Buyer shall be permitted to have
the same performed at its costs and expense.

     5.2 OPERATION OF THE BUSINESS OF SELLER

     Between the date of this Agreement and the Closing, Seller Parties each shall cause each
Seller to:

          (a) conduct its business only in the Ordinary Course of Business;

          (b) except as otherwise directed by Buyer in writing, and without making any commitment on
Buyer’s behalf, use its Best Efforts to preserve intact its current business organization, keep
available the services of its officers, employees and agents and maintain its relations and good
will with suppliers, customers, landlords, creditors, employees, agents and others having business
relationships with it;

          (c) confer with Buyer prior to implementing operational decisions of a material nature;

          (d) otherwise report periodically to Buyer concerning the status of its business, operations
and finances;

          (e) make no material changes in management personnel without prior consultation with Buyer;

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EXECUTION VERSION

          (f) maintain the Assets in a state of repair and condition that complies with Legal
Requirements, satisfies the Current Production Output Requirements and is consistent with the
requirements and normal conduct of Company’s and Suzhou’s businesses;

          (g) keep in full force and effect, without amendment, all material rights relating to
Company’s and Suzhou’s businesses;

          (h) comply with all Legal Requirements and contractual obligations applicable to the
operations of the Business and the Franklin Street Property;

          (i) continue in full force and effect the insurance coverage under the policies set forth in
Schedule 3.21(a);

          (j) except as required to comply with ERISA or to maintain qualification under Section 401(a)
of the Code, not amend, modify or terminate any Employee Plan without the express written consent
of Buyer, and except as required under the provisions of any Employee Plan, not make any
contributions to or with respect to any Employee Plan without the express written consent of Buyer,
provided that Company shall contribute that amount of cash to each Employee Plan necessary to fully
fund all of the benefit liabilities of such Employee Plan on a plan-termination basis as of the
Closing Date;

          (k) cooperate with Buyer and assist Buyer in identifying the Governmental Authorizations
required by Buyer to operate the Business from and after the Closing Date and either transferring
existing Governmental Authorizations of Company or Suzhou to Buyer, where permissible, or obtaining
new Governmental Authorizations for Buyer;

          (l) upon request from time to time, execute and deliver all documents, and do all other acts
that may be reasonably necessary or desirable in the opinion of Buyer to consummate the
Contemplated Transactions, all without further consideration; and

          (m) maintain all books and Records of Sellers relating to Sellers’ business in the Ordinary
Course of Business.

          (n) maintain fire and casualty insurance with respect to all Improvements, with coverages in
amounts sufficient to cover the replacement cost of the Improvements.

     5.3 NEGATIVE COVENANT

     Except as otherwise expressly permitted herein, between the date of this Agreement and the
Closing Date, neither Company, Suzhou nor Shareholders shall permit Company or Suzhou to, without
the prior written Consent of Buyer, (a) take any affirmative action, or fail to take any reasonable
action within its control, as a result of which any of the changes or events listed in Sections
3.15 or 3.19 occur or would be likely to occur; (b) make any modification to any material Contract
or Governmental Authorization; (c) enter into any compromise or settlement of any litigation,
proceeding or governmental investigation relating to the Assets, the Business or the Assumed
Liabilities; (d) sell, lease, license, encumber, pledge or otherwise surrender, relinquish or
dispose of any of the Assets (including, without limitation, any Real Property), except for the
sale of Inventory in the Ordinary Course of Business of the Company; (e) except in accordance with
the

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EXECUTION VERSION

Construction Agreement (subject to the approval of Buyer with respect to any amendment
thereto) remodel or make any material alteration to any Facility without in each instance obtaining
the prior written consent of Buyer; or (f) commit or agree to do any of the foregoing.

     5.4 REQUIRED APPROVALS

     As promptly as practicable after the date of this Agreement, Seller Parties shall make all
filings required by Legal Requirements to be made by them in order to consummate the Contemplated
Transactions (including all filings under the HSR Act). Company, Suzhou and Shareholders also shall
cooperate with Buyer and its Representatives with respect to all filings that Buyer elects to make
or, pursuant to Legal Requirements, shall be required to make in connection with the Contemplated
Transactions. Seller Parties also shall cooperate with Buyer and its Representatives in obtaining
all Material Consents (including taking all actions requested by Buyer to cause early termination
of any applicable waiting period under the HSR Act).

     5.5 NOTIFICATION

     Between the date of this Agreement and the Closing, Seller Parties shall promptly notify Buyer
in writing if any of them becomes aware of (a) any fact or condition that causes or constitutes a
Breach of any of Seller Parties’ representations and warranties made as of the date of this
Agreement or (b) the occurrence after the date of this Agreement of any fact or condition that
would or be reasonably likely to (except as expressly contemplated by this Agreement) cause or
constitute a Breach of any such representation or warranty had that representation or warranty been
made as of the time of the occurrence of, or Seller Parties’ discovery of, such fact or condition.
Should any such fact or condition require any change to the Disclosure Schedule, the affected
Seller Party shall promptly deliver to Buyer a supplement to the Disclosure Schedule specifying
such change. Such delivery shall not affect any rights of Buyer under Section 9.2 and Article 11.
During the same period, Seller Parties also shall promptly notify Buyer of the occurrence of any
Breach of any covenant of Seller Parties in this Article 5 or of the occurrence of any event that
may make the satisfaction of the conditions in Article 7 impossible or unlikely.

     5.6 NO NEGOTIATION

     Until such time as this Agreement shall be terminated pursuant to Section 9.1, none of the
Seller Parties shall directly or indirectly solicit, initiate, encourage, discuss or support any
inquiry or proposal from, discuss or negotiate with, provide any information to or consider the
merits of any inquiry or proposal from any Person (other than Buyer) relating to any business
combination transaction involving Company, Suzhou or the Assets, including without limitation the
sale by Shareholders of Company’s stock, sale by Company of Suzhou’s equity interests, the merger
or consolidation of Company or Suzhou or the sale of Company’s or Suzhou’s business or any of the
Assets (other than in the Ordinary Course of Business). Seller Parties shall notify Buyer of any
such inquiry or proposal within twenty-four (24) hours of receipt or awareness of the same by
Seller Parties, including the name/identity of the interested party(ies) including the Person who
controls such party and the terms and conditions and other related information with respect
thereto.

     5.7 BEST EFFORTS

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EXECUTION VERSION

     Seller Parties shall use their Best Efforts to obtain the transfer to Buyer of the
Governmental Authorization listed on Schedule 7.3, the consents to the transfer to Buyer of the
Acquired Contracts listed on Schedule 2.1(e) and the consents set forth on Schedule 3.2(c).

     5.8 INTERIM FINANCIAL STATEMENTS

     Until the Closing Date, Seller shall deliver to Buyer within fifteen (15) days after the end
of each month a copy of the balance sheet and income statement of the Company and Suzhou for such
month prepared in a manner and containing information consistent with Company’s and Suzhou’s
current practices and certified by Company’s controller as to compliance with Section 3.4.

     5.9 PAYMENT OF LIABILITIES

     Each of Company and Suzhou shall pay or otherwise satisfy in the Ordinary Course of Business
all of its Liabilities and obligations. Buyer and Sellers hereby waive compliance with any
applicable bulk-transfer provisions of the Uniform Commercial Code (or any similar law) (“Bulk
Sales Laws”) in connection with the Contemplated Transactions.

     5.10 HART SCOTT RODINO

     Seller Parties shall (i) within 5 Business Days of the date hereof file the Premerger
Notification Report required under the HSR Act, including, if so requested by Buyer, a request for
early termination, (ii) promptly respond to any request from a Governmental Body pursuant thereto,
and (iii) cooperate with Buyer in order to comply with the HSR Act.

     5.11 [INTENTIONALLY OMITTED]

     5.12 [***]

     Prior to the Closing, but not until after Buyer files its Form 8-K with the Securities
Exchange Commission publicly announcing the existence of this Agreement, Seller Parties shall use
their Best Efforts to obtain the consent of [***] for the assignment by Company
of its right to [***] owned by [***]

     5.13 USE OF BULLEN NAME

     Seller Parties agree that Buyer shall have the right to use the name “Bullen Semiconductor, a
division of Lam Research Corporation” in the Business from and after the Effective Time, until the
fifth (5th) anniversary of the Closing. Company agrees to take such further and other
actions reasonably requested by Buyer, without any expense to Buyer, in order to permit and effect
such use by Buyer. Seller Parties agree that none of them will use the name “Bullen Semiconductor”
or any name confusingly similar to such name during such five (5) year period following Closing.
Without limiting the foregoing, Suzhou agrees to change its name to a name wholly dissimilar to its
present name effective as of the Closing.

     5.14 [***]

THE
SYMBOL [***] IS USED TO INDICATE THAT A PORTION OF THE EXHIBIT HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTION.

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EXECUTION VERSION

     Company agrees that it will promptly, but in no event later than three (3) business days after
the date of this Agreement, file a [***] and pay any applicable penalties, fines and fees related thereto, and Company shall
take all other actions reasonably requested by Buyer to mitigate the consequences of [***]. Company shall submit a draft of the [***] to Buyer for Buyer’s
reasonable review and approval prior to the filing of the [***].
Following the filing of the [***] with [***], Company shall promptly furnish
Buyer with copies of all communications received by Company from
[***] or [***] with respect to the [***].

     5.15 CONSTRUCTION AGREEMENT CHANGE ORDER

     Neither Seller shall authorize any Change Order or Change Directive (including without
limitation, Change Orders and/or Change Directives that have or would have the affect of increasing
or modifying the GMP, Schedule of Work or Work) without in each instance Buyer’s written consent,
which consent, in the case of a Change Order or Change Directive that has or would have the affect
of increasing or modifying the GMP, Schedule of Work or Work, may be withheld or granted in Buyer’s
sole discretion, and in all other cases shall not be unreasonably withheld. For purposes of this
Section 5.15, the terms “Change Order,” “Change Directive,” “GMP,” “Schedule of Work” and “Work”
shall have the meanings assigned to them in the Construction Agreement.

6. Covenants of Buyer Prior to Closing

     6.1 REQUIRED APPROVALS

     Promptly after the date of this Agreement, Buyer shall make, or cause to be made, all filings
required by Legal Requirements (including all filings under the HSR Act) to be made by it to
consummate the Contemplated Transactions. Buyer also shall cooperate, with Seller (a) with respect
to all filings Seller shall be required by Legal Requirements to make and (b) in obtaining all
Consents identified in Schedule 3.2(c), provided, however, that Buyer shall not be required to
dispose of or make any change to its business, expend any funds (other than the filing fees under
HSR Act) or incur any other burden in order to comply with this Section 6.1.

     6.2 HART SCOTT RODINO

     Buyer shall (i) within 5 Business Days of the date hereof, file the Premerger Notification
Report required under the HSR Act, (ii) promptly respond to any request from a Governmental Body
pursuant thereto, and (iii) cooperate with Seller Parties in order to comply with the HSR Act.

     6.3 COOPERATION REGARDING [***]

THE
SYMBOL [***] IS USED TO INDICATE THAT A PORTION OF THE EXHIBIT HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTION.

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     Buyer will cooperate with Company in seeking [***] consent pursuant to
Section 5.12 , provided that Buyer shall not be required to incur any cost or expense or materially
change the terms of [***] as existed prior to Closing.

     6.4 FRANKLIN STREET EXPANSION.

     Subject to receipt of payment confirmation pursuant to Section 2.7(a)(xviii), Buyer shall
reimburse Company, on a dollar-for-dollar basis, for all costs and expenses related to the
expansion of the Franklin Street Facility, incurred by Company during the time period commencing on
January 1, 2006 and ending on June 22, 2006, not to exceed $648,000 (“Franklin Street Costs”).

7. Conditions Precedent to Buyer’s Obligation to Close

     Buyer’s obligation to purchase the Assets and to take the other actions required to be taken
by Buyer at the Closing is subject to the satisfaction, at or prior to the Closing, of each of the
following conditions (any of which may be waived by Buyer, in whole or in part):

     7.1 ACCURACY OF REPRESENTATIONS

          (a) All of Seller Parties’ representations and warranties in this Agreement (considered
collectively), and each of these representations and warranties (considered individually), shall
have been accurate in all material respects as of the date of this Agreement, and shall be accurate
in all material respects as of the time of the Closing as if then made, without giving effect to
any supplement to the Disclosure Schedule.

          (b) Each of the representations and warranties in Sections 3.2(a) and 3.4, and each of the
representations and warranties in this Agreement that contains an express materiality
qualification, shall have been accurate in all respects as of the date of this Agreement, and shall
be accurate in all respects as of the time of the Closing as if then made, without giving effect to
any supplement to the Disclosure Schedule.

     7.2 SELLER PARTIES’ PERFORMANCE

     All of the covenants and obligations that Seller Parties are required to perform or to comply
with pursuant to this Agreement at or prior to the Closing (considered collectively), and each of
these covenants and obligations (considered individually), shall have been duly performed and
complied with.

     7.3 CONSENTS

     Each of the Governmental Authorizations and Consents identified in Schedule 7.3 (the “Material
Consents”) shall have been obtained and shall be in full force and effect.

     7.4 ADDITIONAL DOCUMENTS

     Seller Parties shall have caused the documents and instruments required by Section 2.7(a) and
the following documents to be delivered (or tendered subject only to Closing) to Buyer:

THE
SYMBOL [***] IS USED TO INDICATE THAT A PORTION OF THE EXHIBIT HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTION.

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          (a) Opinions of Coolidge, Wall Co., L.P.A. and Chinese counsel to Suzhou, which counsel shall
be reasonably satisfactory to Buyer, dated the Closing Date, in form and substance satisfactory to
Buyer and its counsel (the opinion of Chinese counsel shall be limited to organization of Suzhou,
due authorization and enforceability of the Agreement and the Contemplated Transactions);

          (b) The articles of incorporation and all amendments thereto of Company, duly certified as of
a date within 30 days prior to Closing by the Secretary of State of Ohio;

          (c) The regulations of Company, duly certified as of the Closing Date by the Secretary of
Company;

          (d) The articles of association of Suzhou, duly certified as of the Closing Date by a duly
appointed and serving officer of Suzhou;

          (e) A copy of the resolutions of the board of directors and shareholders of Company
authorizing the execution and delivery of this Agreement and the consummation of the Contemplated
Transactions, certified as true, accurate and complete by the Secretary of Company;

          (f) A copy of the resolutions of the members of E122 authorizing the execution and delivery of
this Agreement and the consummation of the Contemplated Transactions, certified as true, accurate
and complete by a member of E122;

          (g) Releases of all Encumbrances on the Assets, other than Permitted Encumbrances, including
without limitation releases of each mortgage of record and reconveyances of each deed of trust with
respect to each parcel of real property included in the Assets;

          (h) Certificates dated as of a date not earlier than ten (10) days prior to the Closing as to
the good standing of Company and E122, executed by the appropriate officials of the State of Ohio
and each jurisdiction in which Company or E122 is licensed or qualified to do business as a foreign
corporation as specified in Schedule 3.1(a);

          (i) A copy of the current business license of Suzhou, certified as true, accurate and complete
by a duly appointed officer of Suzhou, and chopped with the chop of the local (Suzhou New District)
Administration of Industry and Commerce;

          (j) A copy of all resolutions and company actions of Suzhou, necessary to approve this
Agreement and the consummation of the Contemplated Transactions, certified as true, accurate and
complete by an officer of Suzhou; and

          (k) Such other documents as Buyer may or its counsel may reasonably request:

     7.5 NO PROCEEDINGS

     Since the date of this Agreement, there shall not have been commenced or threatened against
Buyer, or against any Related Person of Buyer, any Proceeding (a) involving any challenge to, or
seeking material damages or other relief in connection with, any of the Contemplated Transactions

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EXECUTION VERSION

or (b) that may have the effect of preventing, delaying, making illegal, imposing material
limitations or conditions on or otherwise materially interfering with any of the Contemplated
Transactions.

     7.6 [INTENTIONALLY OMITTED]

     7.7 TITLE INSURANCE

     Buyer shall have received unconditional and binding commitments to issue policies of title
insurance (the “Title Commitment”) from a title insurer reasonably acceptable to it, (“Title
Insurer”) to insure fee simple, or as the case may be, leasehold title to all Land, Improvements,
insurable appurtenances, if any, and Ground Lease Property, in an aggregate amount equal to the
amount of the Purchase Price allocated to the Real Property, deleting all requirements listed in
ALTA Schedule B-1, amending the effective date to the Closing Date and time of Closing with no
exception for the gap between Closing and recordation, deleting or insuring over all so called
“standard exceptions” and all exceptions that pertain to Encumbrances, Encumbrances involving any
monetary claim or lien against or with respect to the Real Property, or any portion thereof, or
Encumbrances that are not Permitted Real Estate Encumbrances, attaching all endorsements required
by Buyer, and otherwise in form and substance satisfactory to Buyer in its sole discretion.

     7.8 SURVEY

     Buyer shall have received a survey with respect to each tract or parcel of Real Property and
all Improvements thereon (each, a “Survey”) in form and substance reasonably satisfactory to Buyer
and made by a land surveyor licensed in by the State of Ohio and bearing a certificate, signed and
sealed by the surveyor, certifying to Buyer and the Title Insurer that:

          (a) each such survey was made (A) in accordance with “Minimum Standard Detail Requirements for
ALTA/ACSM Land Title Surveys,” and includes Items 1-4, 6, 7(a), 7(b)(1), 7(c), 8-11 and 13 of Table
A thereof, and (B) pursuant to the Accuracy Standards (as adopted by ALTA and ACSM and in effect on
the date of said certificate);

          (b) each such Survey reflects the location of all building lines, easements and areas affected
by any recorded documents affecting such Real Property as discussed in the Title Commitment
applicable thereto, as well as any encroachments onto the Real Property or by the Improvements onto
any easements area or adjoining property.

     No Survey shall include or identify any gaps, gores, encroachments, defects or other matters
adversely affecting the title to the Real Property or the Improvements identified therein, other
than Permitted Real Estate Encumbrances.

     7.9 ZONING

     Buyer shall have received written confirmation from applicable Governmental Bodies, as well as
any other written confirmation that Buyer determines is necessary or desirable, that the Real
Property and the Improvements, and the use thereof for the various purposes for which they are
presently being used, is permitted under, and is in compliance with, all applicable zoning Legal
Requirements and are not subject to “permitted nonconforming” use or structure classifications and

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EXECUTION VERSION

are otherwise in compliance with all other applicable Legal Requirements, including, without
limitation, those pertaining to building requirements and the disabled.

     7.10 GOVERNMENTAL AUTHORIZATIONS

     Buyer shall have received such Governmental Authorizations as are listed on Schedule 7.3 to
allow Buyer to own and operate the Assets from and after the Closing.

     7.11 ENVIRONMENTAL REPORT

     Buyer shall have received an environmental site assessment report from ERM with respect to the
Facilities and the facility in which Suzhou operates its Business, which report shall be acceptable
in form and substance to Buyer in its reasonable discretion, and shall not set forth any material
adverse findings with respect to the Real Property, Land or Facilities.

     7.12 EMPLOYEES

          (a) Buyer and [***] shall have entered into the Employment Agreement.

          (b) Substantially all other employees of Company (other than those employed at the Camden Road
Property) and all employees of Suzhou shall be available for hiring by Buyer, in its sole
discretion, on and as of the Closing Date.

     7.13 NONCOMPETITION AGREEMENTS

     Each Seller Party shall have executed and delivered a Noncompetition Agreement.

     7.14 NO INJUNCTION

     There shall not be in effect any Legal Requirement or any injunction or other order that (a)
prohibits the consummation of the contemplated transactions and (b) has been adopted or issues, or
has otherwise become effective, since the date of this Agreement.

     7.15 LRC CHINA

     Buyer and/or LRC China shall have received all necessary Governmental Authorizations to
acquire, own, operate and conduct the business, assets, and operations previously conducted by
Suzhou, including but not limited to:

     (a) business licenses set forth on Schedule 7.15(a), and

     (b) approval of the sale and purchase of the Assets of Suzhou and the transactions
contemplated by this Agreement pursuant to all Chinese Legal Requirements, including but not
limited to the approval of the Jiangsu Department of Foreign Economic Relations and Trade.

     7.16 MATERIAL ADVERSE CHANGE

THE
SYMBOL [***] IS USED TO INDICATE THAT A PORTION OF THE EXHIBIT HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTION.

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 EXECUTION VERSION

          (a) There shall have been no material adverse change after the date hereof in the Assets or
Business or in the business, operations, prospects or condition (financial or otherwise) of Company
or Suzhou.

          (b) There shall have been no material adverse change after the date hereof in the business,
operations, prospects or condition (financial or otherwise) of Buyer.

     7.17 [INTENTIONALLY LEFT BLANK]

     7.18 HART SCOTT RODINO WAITING PERIOD

     The waiting period under the HSR Act shall have expired or been terminated.

     7.19 [***]

     Company shall have made the [***] and taken all
reasonable steps to mitigate the consequences of [***] and such other actions as
provided in Section 5.14.

     7.20 SUZHOU LEASE

     The lease term of the Intent Agreement on the Leasing of Ready-built Factory Building dated
October 8, 2003 between Suzhou New & Hi-tech Development Zone Export Processing Zone and Company
(the “Suzhou Lease”) shall have been extended for a period of at least six (6) months beyond its
current expiration/termination date through May 14, 2007, which extension shall not materially
modify the other terms and conditions of the Suzhou Lease, as determined by Buyer in its reasonable
judgment. Seller Parties shall deliver to Buyer a true, complete and accurate executed English
language copy of such extension.

     7.21 [INTENTIONALLY LEFT BLANK]

8. Conditions Precedent to Seller Parties’ Obligation to Close

     Seller Parties’ obligation to sell the Assets and to take the other actions required to be
taken by them at the Closing is subject to the satisfaction, at or prior to the Closing, of each of
the following conditions (any of which may be waived by Seller in whole or in part):

     8.1 ACCURACY OF REPRESENTATIONS

     All of Buyer’s representations and warranties in this Agreement (considered collectively), and
each of these representations and warranties (considered individually), shall have been accurate in
all material respects as of the date of this Agreement and shall be accurate in all material
respects as of the time of the Closing as if then made.

     8.2 BUYER’S PERFORMANCE

     All of the covenants and obligations that Buyer is required to perform or to comply with
pursuant to this Agreement at or prior to the Closing (considered collectively), and each of these

THE SYMBOL [***] IS USED TO INDICATE THAT A PORTION OF THE EXHIBIT HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE
OMITTED PORTION.

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EXECUTION VERSION

covenants and obligations (considered individually), shall have been performed and complied
with in all material respects.

     8.3 CONSENTS

     Each of the Consents identified in Schedule 8.3 shall have been obtained and shall be in full
force and effect.

     8.4 ADDITIONAL DOCUMENTS

     Buyer shall have caused the documents and instruments required by Section 2.7(b) and the
following documents to be delivered (or tendered subject only to Closing) to Seller Parties:

          (a) an opinion of Dinsmore & Shohl LLP, dated the Closing Date, in form and substance
satisfactory to Seller Parties and their counsel; and

          (b) such other documents as Seller Parties or its counsel may reasonably request.

     8.5 NO INJUNCTION

     There shall not be in effect any Legal Requirement or any injunction or other Order that (a)
prohibits the consummation of the Contemplated Transactions and (b) has been adopted or issued, or
has otherwise become effective, since the date of this Agreement.

     8.6 NO PROCEEDINGS

     Since the date of this Agreement, there shall not have been commenced or threatened against a
Seller Party or against any Related Person of Seller Party, any Proceeding (a) involving any
challenge to, or seeking material damages or other relief in connection with, any of the
Contemplated Transactions or (b) that may have the effect of preventing, delaying, making illegal,
imposing material limitations or conditions on or otherwise materially interfering with any of the
Contemplated Transactions.

     8.7 [INTENTIONALLY OMITTED]

     8.8 HART SCOTT RODINO WAITING PERIOD

     The waiting period under the HSR Act shall have expired or been terminated.

9. Termination

     9.1 TERMINATION EVENTS

     By notice given prior to or at the Closing, subject to Section 9.2, this Agreement may be
terminated as follows:

          (a) by Buyer if a material Breach of any provision of this Agreement has been committed by any
Seller Party and such Breach has not been waived by Buyer;

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EXECUTION VERSION

          (b) by Seller Parties if a material Breach of any provision of this Agreement has been
committed by Buyer and such Breach has not been waived by Seller Parties;

          (c) by Buyer if any condition in Article 7 has not been satisfied as of the date specified for
Closing in the first sentence of Section 2.6 or if satisfaction of such a condition by such date is
or becomes impossible (other than through the failure of Buyer to comply with its obligations under
this Agreement), and Buyer has not waived such condition on or before such date;

          (d) by Seller Parties if any condition in Article 8 has not been satisfied as of the date
specified for Closing in the first sentence of Section 2.6 or if satisfaction of such a condition
by such date is or becomes impossible (other than through the failure of any Seller Party to comply
with their obligations under this Agreement), and Seller Parties have not waived such condition on
or before such date;

          (e) by mutual consent of Buyer and Seller Parties;

          (f) by Buyer if the Closing has not occurred on or before December 9, 2006, or such later date
as the parties may agree upon, unless the Buyer is in material Breach of this Agreement;

          (g) by Seller Parties if the Closing has not occurred on or before December 9, 2006, or such
later date as the parties may agree upon, unless any Seller Party is in material Breach of this
Agreement; or

          (h) by Buyer in accordance with Section 13.17.

     9.2 EFFECT OF TERMINATION

     Each party’s right of termination under Section 9.1 is in addition to any other rights it may
have under this Agreement or otherwise, and the exercise of such right of termination will not be
an election of remedies. If this Agreement is terminated pursuant to Section 9.1, all obligations
of the parties under this Agreement will terminate, except that the obligations of the parties in
this Section 9.2 and Articles 12 and 13 (except for those in Section 13.5) will survive, provided,
however, that, if this Agreement is terminated because of a Breach of this Agreement by the
nonterminating party or because one or more of the conditions to the terminating party’s
obligations under this Agreement is not satisfied as a result of the party’s failure to comply with
its obligations under this Agreement, the terminating party’s right to pursue all legal remedies
will survive such termination unimpaired.

10. Additional Covenants

     10.1 EMPLOYEES AND EMPLOYEE BENEFITS

          (a) Information on Active Employees

          For the purpose of this Agreement, the term “Active Employees” shall mean all employees
employed on the Closing Date by Company or Suzhou in connection with the operation of the Business
(which employees as of the date hereof are listed on Schedule 10.1, which schedule Buyer agrees to
update as of Closing), including employees on temporary leave of absence,

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EXECUTION VERSION

including family and/or medical leave, military leave, temporary disability or sick leave, but
excluding employees on long-term disability leave and employees who have been exclusively employed
at the Camden Road Property performing work unrelated to the Business.

          (b) Employment of Active Employees by Buyer.

               (i) Buyer is not obligated to hire any Active Employee but may interview all Active Employees.
Buyer will provide Company with a list of Active Employees to whom Buyer has made an offer of
employment that has been accepted to be effective on the Closing Date (the “Hired Active
Employees”). Subject to Legal Requirements, Buyer will have reasonable access to the Facilities and
personnel Records (including performance appraisals, disciplinary actions, grievances and medical
Records) of Company and Suzhou for the purpose of preparing for and conducting employment
interviews with all Active Employees and will conduct the interviews as expeditiously as possible
prior to the Closing Date. Access will be provided by Company and Suzhou upon reasonable prior
notice during normal business hours. Effective immediately before the Closing, Company and Suzhou
will terminate the employment of all of its Active Employees.

               (ii) It is understood and agreed that (A) Buyer’s expressed intention to extend offers of
employment as set forth in this section shall not constitute any commitment, contract or
understanding (expressed or implied) of any obligation on the part of Buyer to a post-Closing
employment relationship of any fixed term or duration or upon any terms or conditions other than
those that Buyer may establish pursuant to individual offers of employment, and (B) employment
offered by Buyer is “at will” and may be terminated by Buyer or by an employee at any time for any
reason (subject to any written commitments to the contrary made by Buyer or an employee and Legal
Requirements). Nothing in this Agreement shall be deemed to prevent or restrict in any way the
right of Buyer to terminate, reassign, promote or demote any of the Hired Active Employees after
the Closing or to change adversely or favorably the title, powers, duties, responsibilities,
functions, locations, salaries, other compensation or terms or conditions of employment of such
employees.

          (c) Salaries and Benefits

               (i) Company or Suzhou, as the case may be, shall be responsible for (A) the payment of all
wages and other remuneration due to Active Employees with respect to their services as employees of
Company or Suzhou through the close of business on the Closing Date, including pro rata bonus
payments earned prior to the Closing Date; (B) the payment of any termination or severance payments
and the provision of health plan continuation coverage in accordance with the requirements of COBRA
and Sections 601 through 608 of ERISA; and (C) any and all payments to employees required under the
WARN Act.

               (ii) Company or Suzhou, as the case may be, shall be liable for any claims made or incurred by
Active Employees and their beneficiaries under the Employee Plans.

          (d) Company’s Retirement Plans.

               (i) All Hired Active Employees who are participants in Company’s retirement plans shall retain
their accrued benefits under Company’s retirement plans as of the

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EXECUTION VERSION

Closing Date, and Company (or Company’s retirement plans) shall retain sole liability for the
payment of such benefits as and when such Hired Active Employees become eligible therefor under
such plans. All Hired Active Employees shall become fully vested in their accrued benefits under
Company’s Employee Plans that are intended to be qualified under Section 401(a) of the Code as of
the Closing Date, and Company will so amend such plans if necessary to achieve this result.

          (e) No Transfer of Assets. Neither Company nor Shareholders nor their respective Related Persons
will make any transfer of pension or other employee benefit plan assets to Buyer.

          (f) Buyer will set its own initial terms and conditions of employment for the Hired Active
Employees and others it may hire, including work rules, benefits and salary and wage structure, all
as permitted by law. Buyer is not obligated to assume any such matters under this Agreement.
Company or Suzhou, as the case may be, shall be solely liable for any severance payment required to
be made to its employees due to the Contemplated Transactions.

          (g) General Employee Provisions.

               (i) Company or Suzhou, as the case may be, shall give any notices required by Legal
Requirements and take whatever other actions with respect to the plans, programs and policies
described in this Section 10.1 as may be necessary to carry out the arrangements described in this
Section 10.1.

               (ii) Company or Suzhou, as the case may be, shall provide Buyer with copies of such plan
documents and summary plan descriptions, employee data or other information as may be reasonably
required to carry out the arrangements described in this Section 10.1.

               (iii) If any of the arrangements described in this Section 10.1 are determined by the IRS or
other Governmental Body to be prohibited by law, Company or Suzhou, as the case may be, shall
modify such arrangements to as closely as possible reflect their expressed intent and retain the
allocation of economic benefits and burdens to the parties contemplated herein in a manner that is
not prohibited by law.

               (iv) Company or Suzhou, as the case may be, shall provide Buyer with completed I-9 forms and
attachments with respect to all Hired Active Employees, except for such employees as Company or
Suzhou, as the case may be, certifies in writing to Buyer are exempt from such requirement.

               (v) Buyer shall not have any responsibility, liability or obligation, whether to Active
Employees, former employees, their beneficiaries or to any other Person, with respect to any
employee benefit plans, practices, programs or arrangements (including the establishment, operation
or termination thereof and the notification and provision of COBRA coverage extension) maintained
by Company or Suzhou, as the case may be.

          (h) Covenant Not To Hire — Seller Parties. Each Seller Party covenants and agrees not to hire
or solicit for hire, directly or indirectly, any Active Employees as provided in the Noncompetition
Agreements.

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EXECUTION VERSION

          (i) Covenant Not To Hire — Buyer. Buyer covenants and agrees not to hire or solicit for hire,
directly or indirectly, any employee of Company employed exclusively at the Camden Road Property as
provided in the Noncompetition Agreements.

     10.2 PAYMENT OF ALL TAXES RESULTING FROM SALE OF ASSETS BY SELLER

     Seller Parties shall pay in a timely manner all Taxes resulting from or payable in connection
with the sale of the Assets pursuant to this Agreement, regardless of the Person on whom such Taxes
are imposed by Legal Requirements.

     10.3 PAYMENT OF OTHER RETAINED LIABILITIES

     In addition to payment of Taxes pursuant to Section 10.2, Seller Parties shall timely pay,
satisfy, discharge or make adequate provision for the timely payment, in full all of the Retained
Liabilities and other Liabilities of Seller Parties under this Agreement. If any such Liabilities
are not so paid or provided for, or if Buyer reasonably determines that failure to make any
payments will impair Buyer’s use or enjoyment of the Assets or conduct of the Business, Buyer may,
at any time after the Closing Date, elect to make all such payments directly (but shall have no
obligation to do so) and set off and deduct the full amount of all such payments from the then
remaining funds held pursuant to the Escrow Agreement.

     10.4 INTENTIONALLY LEFT BLANK

     10.5 RESTRICTIONS ON CHANGE IN CONTROL AND DISSOLUTION OF COMPANY

     (a) For a period of five (5) years after the Closing Date, neither Company nor Shareholders
shall, and Shareholders shall not cause or permit Company to, without the prior written consent of
Buyer, which consent may be granted or withheld by Buyer in its sole discretion, (i) merge Company
with or into or consolidate Company with any Person, (ii) sell all or substantially all of the
assets of Company, (iii) enter into any agreement (whether written or oral) the consummation of
which would result in more than a majority of the voting power of Company being owned or
controlled by any Person other than Shareholders, (iv) effect a reorganization of Company or (v)
dissolve Company.

     (b) For a period of two (2) years after the fifth anniversary of the Closing Date, neither
Company nor Shareholders shall, and Shareholders shall not cause or permit Company to, without the
prior written consent of Buyer, which consent may be granted or withheld by Buyer in its sole
discretion, (i) merge Company with or into or consolidate Company with any Person reasonably deemed
to be a competitor of Buyer, (ii) sell all or substantially all of the assets of Company to any
Person reasonably deemed to be a competitor of Buyer, or (iii) enter into any agreement (whether
written or oral) the consummation of which would result in more than a majority of the voting power
of Company being owned or controlled by any Person reasonably deemed to be a competitor of Buyer,
provided however, that the Company may terminate the restrictions in this Section 10.5(b) after the
fifth anniversary of the Closing Date by (x) terminating the License Agreement, (y)

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EXECUTION VERSION

returning all intellectual property covered by the License Agreement to Buyer, including
copies of all manuals, documents and other confidential information, and (z) entering into a
confidentiality agreement with Buyer in a form reasonably acceptable to Buyer.

     10.6 REMOVING EXCLUDED ASSETS

     On or before the Closing Date, Company and Suzhou, as the case maybe, shall remove the
Excluded Assets located at the Facilities and listed on Schedule 2.2(m). Such removal shall be
done in such manner as to avoid any damage to the Facilities and other Assets and to avoid any
disruption of the business operations to be conducted by Buyer after the Closing. Any damage to the
Facilities or other Assets resulting from such removal shall be paid by Company at the Closing.
Should Company or Suzhou, as the case may be, fail to remove the Excluded Assets as required by
this Section 10.5, Buyer shall have the right, but not the obligation, (a) to remove the Excluded
Assets at Company’s or Suzhou’s, as the case may be, sole cost and expense; (b) to store the
Excluded Assets and to charge Company or Suzhou, as the case may be, all storage costs associated
therewith; (c) to treat the Excluded Assets as unclaimed and to proceed to dispose of the same
under the laws governing unclaimed property; or (d) to exercise any other right or remedy conferred
by this Agreement or otherwise available at law or in equity. Company or Suzhou, as the case may
be, shall promptly reimburse Buyer for all costs and expenses incurred by Buyer in connection with
any Excluded Assets not removed by Company or Suzhou, as the case may be, on or before the Closing
Date. Sellers shall also not cause or permit any mechanics or similar liens to be filed against
any Real Property as a result of any of the foregoing removal and repair of damage by or on behalf
of either Seller.

     10.7 REPORTS AND RETURNS

     Seller Parties shall promptly after the Closing prepare and file all reports and returns
required by Legal Requirements relating to the business of Seller Parties as conducted using the
Assets, to and including the Effective Time.

     10.8 ASSISTANCE IN PROCEEDINGS

     Each party agrees to cooperate with the other party and its counsel in the contest or defense
of, and make available its personnel and provide any testimony and access to its books and Records
in connection with, any Proceeding involving or relating to (a) any Contemplated Transaction or (b)
any action, activity, circumstance, condition, conduct, event, fact, failure to act, incident,
occurrence, plan, practice, situation, status or transaction on or before the Closing Date
involving any Seller Party, the Business or the Assets.

     10.9 CUSTOMER AND OTHER BUSINESS RELATIONSHIPS

     After the Closing, Seller Parties will use Best Efforts to support Buyer in its efforts to
continue and maintain for the benefit of Buyer those business relationships of Company existing
prior to the Closing and relating to the Business, including relationships with lessors, employees,
regulatory authorities, licensors, customers, suppliers and others, and Seller Parties will
satisfy, or cause to be satisfied, the Retained Liabilities in a manner that is not detrimental to
any of such relationships. Seller Parties will refer to Buyer all inquiries relating to the
Business. No Seller Party

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EXECUTION VERSION

nor any of Seller’s officers, employees, agents or shareholders shall take any action that
would tend to diminish the value of the Assets after the Closing or that would interfere with the
business of Buyer to be engaged in after the Closing, including disparaging the name or business of
Buyer.

     10.10 RETENTION OF AND ACCESS TO RECORDS

     After the Closing Date, Buyer shall retain for a period equal to seven (7) years after Closing
Date) those Records of Company and Suzhou delivered to Buyer. Buyer also shall provide Seller
Parties and their Representatives reasonable access thereto, during normal business hours and on at
least three days’ prior written notice, to enable them to prepare financial statements or tax
returns. After the Closing Date, Seller Parties shall provide Buyer and its Representatives
reasonable access to Records that are related to Excluded Assets or the Retained Business, during
normal business hours and on at least three business days’ prior written notice, for any reasonable
business purpose related to the Business, the Assets and/or the Contemplated Transactions as
specified by Buyer in such notice.

     10.11 PRODUCTION REPORTS

     Within five (5) business days prior to the Closing Date, Company agrees to furnish to Buyer
production logs relating to the silicon growers set forth on Schedule 3.10(b), signed by the
President of the Company, certifying that (i) such equipment has been operating at or in excess of
the Current Production Output Requirements for the period beginning on the date of this Agreement
through and including the date of such certificate and (ii) such equipment is in compliance with
the other provisions of this Agreement and (iii) there is no unresolved warranty, service or other
repair outstanding with respect to such equipment (the “Production Certification”).

     10.12 WEBSITE REDIRECT.

     Within five (5) business days after the Closing Date, Company and Buyer will mutually agree on
a modification of its internet website for the purpose of redirecting to Buyer those Persons who
visit Company’s website for reasons related to the Business. Company agrees to maintain such
notice and redirect in place for a period of 180 days following the Closing Date.

     10.13 FURTHER ASSURANCES

     Subject to the proviso in Section 6.1, the parties shall cooperate reasonably with each other
and with their respective Representatives in connection with any steps required to be taken as part
of their respective obligations under this Agreement, and shall (a) furnish upon request to each
other such further information; (b) execute and deliver to each other such other documents; and (c)
do such other acts and things, all as the other party may reasonably request for the purpose of
carrying out the intent of this Agreement and the Contemplated Transactions. Without limiting the
foregoing, Sellers shall, at the reasonable request of Buyer, provided that Sellers shall not be
required to incur any expense (unless Buyer agrees to reimburse Sellers therefore), take such
further and other action, including the execution of documents, necessary to more fully convey to
and vest in Buyer title to the Assets, and to more effectively effect Buyer’s use, possession and
enjoyment of the Assets.

     10.14 UNEMPLOYMENT COMPENSATION RATING

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     Buyer and Sellers agree that Buyer will make the necessary filings for the transfer to Buyer
of the Unemployment Compensation experience rating currently held by the Facility located at the
Franklin Street Property. Sellers shall cooperate with, and provide assistance to the Buyer that
is reasonably necessary to accomplish the Buyer becoming the successor-in-interest for purposes of
the Unemployment Compensation experience rating, including but not limited to, the execution of any
applications necessary to effectuate said successorship.

     10.15 WORKERS’ COMPENSATION RATING

     Buyer and Sellers agree that Buyer will make the necessary filings for the transfer to Buyer
of the Workers’ Compensation experience rating currently held by the Facility located at the
Franklin Street Property. Sellers shall cooperate with, and provide assistance to the Buyer that
is reasonably necessary to accomplish the Buyer becoming the succeeding employer for purposes of
the Workers’ Compensation experience rating, including but not limited to, the execution of any
applications necessary to effectuate said transfer.

     10.16 LICENSE

     Company grants Buyer a limited license to use the text and information used in the Company’s
employees handbook for the purpose of adopting and creating and publishing employee policies and
practices for the Business after the Effective Time. Company makes no representation or warranty
to Buyer with respect to such material.

     10.17 LINDE GAS LLC AGREEMENTS

     The parties agree to use their respective Best Efforts to negotiate and execute amendments to
each of the agreements between Linde Gas LLC and Company referenced in Schedule 3.20(a)(iii), items
6 and 7, in form and substance satisfactory to Buyer.

11. Indemnification; Remedies

     11.1 SURVIVAL

     All representations, warranties, covenants and obligations in this Agreement, the Disclosure
Schedule, the supplements to the Disclosure Schedule, the certificates delivered pursuant to
Section 2.7 and any other certificate or document delivered pursuant to this Agreement shall
survive the Closing and the consummation of the Contemplated Transactions until the date that is
the first anniversary of the Closing Date, except that (i) the representations and warranties in
Sections 3.1, 3.2, 3.28, and 4 shall survive in perpetuity and shall not expire, (ii) the
representations and warranties in Sections 3.6, 3.9, 3.14, 3.22, 3.25(c)(i), 3.25(d)(i), 3.25(e)(i)
and 3.32 and the matters referenced in Section 11.2(g) shall survive until the expiration of the
applicable statute of limitations and (iii) the representations and warranties in Section 3.25
shall survive until date that is the third anniversary of the Closing Date. The right to
indemnification, reimbursement or other remedy based upon such representations, warranties,
covenants and obligations shall not be affected by any investigation (including any environmental
investigation or assessment) conducted with respect to, or any Knowledge acquired (or capable of
being acquired) at any time, whether before or after the execution and delivery of this Agreement
or the Closing Date, with respect to the accuracy or

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inaccuracy of or compliance with any such representation, warranty, covenant or obligation.
The waiver of any condition based upon the accuracy of any representation or warranty, or on the
performance of or compliance with any covenant or obligation, will not affect the right to
indemnification, reimbursement or other remedy based upon such representations, warranties,
covenants and obligations.

     11.2 INDEMNIFICATION AND REIMBURSEMENT BY SELLER PARTIES

     Subject to the provisions of Section 11.5, Seller Parties (other than MB and VB), jointly and
severally, and MB and VB, severally as between themselves, agree to indemnify and hold harmless
Buyer, and its Representatives, shareholders, subsidiaries and Related Persons (collectively, the
“Buyer Indemnified Persons”), and will reimburse the Buyer Indemnified Persons for any loss,
liability, claim, damage, expense (including costs of investigation and defense and reasonable
attorneys’ fees and expenses) or diminution of value, whether or not involving a Third-Party Claim
(collectively, “Damages”), arising from or in connection with:

          (a) any Breach of any representation or warranty made by any Seller Party in (i) this
Agreement, (ii) the Disclosure Schedule (as supplemented prior to Closing), (iii) the certificates
delivered pursuant to Section 2.7 (for this purpose, each such certificate will be deemed to have
stated that Seller Parties’ representations and warranties in this Agreement fulfill the
requirements of Section 7.1 as of the Closing Date as if made on the Closing Date without giving
effect to any supplement to the Disclosure Schedule), (iv) any transfer instrument or (v) any other
certificate, document, writing or instrument delivered by any Seller Party pursuant to this
Agreement;

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

          (c) any Liability other than the Assumed Liabilities;

          (d) any brokerage or finder’s fees or commissions or similar payments based upon any agreement
or understanding made by any Person with any Seller Party (or any Person acting on their behalf) in
connection with any of the Contemplated Transactions;

          (e) any Retained Liabilities;

          (f) any breach of Section 3.32, notwithstanding any disclosure(s) on Schedule 3.15 of the
Disclosure Schedule or any other Schedule cross referencing such matters; or

          (g) any Liability or expense arising out of or related to the disclosure in Schedule 3.10(a),
item 2, except for Buyer’s obligation to pay expenses related to the consolidation of the real
property described in, and pursuant to, that certain side letter agreement, dated of even date
herewith, by and among Buyer, E122 and Eaton 122, Ltd., an Ohio general partnership.

     11.3 [INTENTIONALLY OMITTED].

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EXECUTION VERSION

     11.4 INDEMNIFICATION AND REIMBURSEMENT BY BUYER

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

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

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

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

          (d) any Assumed Liabilities.

Buyer’s indemnification obligations shall not exceed an aggregate of Thirty five million dollars
($35,000,000); provided, however, that Buyer’s indemnification obligations with respect to or in
connection with the Assumed Liabilities and any fraud by Buyer shall have no limit.

     11.5 LIMITATIONS ON AMOUNT—SELLER PARTIES

          (a) Seller Parties shall have no liability (for indemnification or otherwise) with respect to
claims under Section 11.2(a) unless and until the Damages of Buyer Indemnified Persons exceed One
million seven hundred and fifty thousand Dollars ($1,750,000) (the “Threshold”), provided, however,
that (i) all claims under Section 11.2(a) by Buyer Indemnified Persons shall accrue in the
aggregate until the Damages of all Buyer Indemnified Persons exceed the Threshold, and thereupon
Seller Parties shall become obligated to indemnify Buyer Indemnified Persons for all Damages,
including without limitation all amounts up to and including the Threshold amount and (ii) with
respect to any individual claim of Buyer asserted against Seller Party, no such claim shall be made
hereunder or otherwise be taken into account in determining whether the Threshold in the previous
clause (i) has been satisfied, unless and until an individual claim exceeds $25,000. This Section
11.5(a) will not apply to claims under Section 11.2(b) through (g), or to matters arising in
respect of Sections 3.6, 3.9, 3.14, 3.22, 3.25(c)(i), 3.25(d)(i), 3.25(e)(i), 3.26, 3.27, 3.28 or
3.32, or to any Breach of any of Seller Parties’ representations and warranties of which any Seller
Party had Knowledge at any time prior to the date on which such representation and warranty is made
or deemed to be made, or to any intentional Breach by any Seller Party of any covenant or
obligation, or to fraud by any Seller Party.

          (b) Seller Parties’ indemnification obligations shall not exceed an aggregate of Thirty Five
Million Dollars ($35,000,000); provided, however, that Seller Parties’ indemnification obligation
with respect to or in connection with (i) any breach of the representations and warranties in
Sections 3.9, 3.14 and 3.22 shall not exceed an aggregate of One Hundred and Seventy Five Million
Dollars ($175,000,000), (ii) any breach of the representations and warranties in Sections 3.25
(other than 3.25(c)(i), 3.25(d)(i) and 3.25(e)(i)), shall not exceed an aggregate of Fifty Million

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Dollars ($50,000,000) which limitation shall be separate and exclusive from the limitation set
forth in the first clause of this Section 11.5(b) and set forth in the foregoing clause (i), and
(iii) the Retained Liabilities, any matter pursuant to Section 11.2(c), Section 3.6 and the
Excluded Assets shall have no limit. Notwithstanding the foregoing, in no event shall Seller
Parties’ aggregate indemnification obligations hereunder, other than for claims relating to
Retained Liabilities, any matter pursuant to Section 11.2(c) or the Excluded Assets, exceed
$175,000,000.

     11.6 [INTENTIONALLY OMITTED]

     11.7 THIRD-PARTY CLAIMS

          (a) Promptly after receipt by a Person entitled to indemnity under Section 11.2 or 11.4 (an
“Indemnified Person”) of notice of the assertion of a Third-Party Claim against it, such
Indemnified Person shall give notice to the Person obligated to indemnify under such Section (an
“Indemnifying Person”) of the assertion of such Third-Party Claim, provided that the failure to
notify the Indemnifying Person will not relieve the Indemnifying Person of any liability that it
may have to any Indemnified Person, except to the extent that the Indemnifying Person demonstrates
that the defense of such Third Party Claim is materially prejudiced by the Indemnified Person’s
failure to give such notice.

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

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          (c) Notwithstanding the foregoing, if an Indemnified Person determines in good faith that
there is a reasonable probability that a Third-Party Claim may adversely affect it or its Related
Persons other than as a result of monetary damages for which it would be entitled to
indemnification under this Agreement, the Indemnified Person may, by notice to the Indemnifying
Person, assume the exclusive right to defend, compromise or settle such Third-Party Claim, but the
Indemnifying Person will not be bound by compromise or settlement effected without its Consent
(which may not be unreasonably withheld or delayed).

          (d) Notwithstanding the provisions of Section 13.4, each Seller Party hereby consents to the
nonexclusive jurisdiction of any court in which a Proceeding in respect of a Third-Party Claim is
brought against any Buyer Indemnified Person for purposes of any claim that a Buyer Indemnified
Person may have under this Agreement with respect to such Proceeding or the matters alleged therein
and agree that process may be served on any Seller Party with respect to such a claim anywhere in
the world.

          (e) With respect to any Third-Party Claim subject to indemnification under this Article 11:
(i) both the Indemnified Person and the Indemnifying Person, as the case may be, shall keep the
other Person reasonably informed of the status of such Third-Party Claim and any related
Proceedings at all stages thereof where such Person is not represented by its own counsel, and (ii)
the parties agree (each at its own expense) to render to each other such assistance as they may
reasonably require of each other and to cooperate in good faith with each other in order to ensure
the proper and adequate defense of any Third-Party Claim.

          (f) With respect to any Third-Party Claim subject to indemnification under this Article 11,
the parties agree to cooperate in such a manner as to preserve in full (to the extent possible) the
confidentiality of all Confidential Information and the attorney-client and work-product
privileges. In connection therewith, each party agrees that: (i) it will use its Best Efforts, in
respect of any Third-Party Claim in which it has assumed or participated in the defense, to avoid
production of Confidential Information (consistent with applicable law and rules of procedure), and
(ii) all communications between any party hereto and counsel responsible for or participating in
the defense of any Third-Party Claim shall, to the extent possible, be made so as to preserve any
applicable attorney-client or work-product privilege.

     11.8 INDEMNIFICATION PAYMENT

          (a) All amounts payable by one party to another pursuant to this Article 11 shall be paid in
immediately available funds within five (5) days after final determination of such amounts payable.
Buyer Indemnified Persons may seek payment of any part or all amounts payable by Seller Parties
pursuant to this Article 11 from the then remaining funds held under the Escrow Agreement in
accordance with the terms, provisions and procedures set forth in the Escrow Agreement.

     11.9 [INTENTIONALLY OMITTED].

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12. Confidentiality

     12.1 DEFINITION OF CONFIDENTIAL INFORMATION

          (a) As used in this Article 12, the term “Confidential Information” includes any and all of
the following information of Company, Suzhou, Shareholders or Buyer that has been or may hereafter
be disclosed in any form, whether in writing, orally, electronically or otherwise, or otherwise
made available by observation, inspection or otherwise by any party or its Representatives (a
“Disclosing Party”) to the other party or its Representatives (a “Receiving Party”):

               (i) all information that is a trade secret under applicable trade secret or other law;

               (ii) all information concerning product specifications, data, know-how, formulae,
compositions, processes, designs, sketches, photographs, graphs, drawings, samples, inventions and
ideas, past, current and planned research and development, current and planned manufacturing or
distribution methods and processes, customer lists, current and anticipated customer requirements,
price lists, market studies, business plans, computer hardware, Software and computer software and
database technologies, systems, structures and architectures whether or not such information is
protected by copyright, trademark, patent or other intellectual property rights;

               (iii) all information concerning the business and affairs of the Disclosing Party (which
includes without limitation historical and current financial statements, financial projections and
budgets, tax returns and accountants’ materials, historical, current and projected sales, capital
spending budgets and plans, business plans, strategic plans, marketing and advertising plans,
publications, client and customer lists and files, contracts, the names and backgrounds of key
personnel and personnel training techniques and materials, however documented), and all information
obtained from review of the Disclosing Party’s documents or property or discussions with the
Disclosing Party regardless of the form of the communication; and

               (iv) all notes, analyses, compilations, studies, summaries and other material prepared by the
Receiving Party to the extent containing or based, in whole or in part, upon any information
included in the foregoing.

          (b) Any trade secrets of a Disclosing Party shall also be entitled to all of the protections
and benefits under applicable trade secret law and any other applicable law. If any information
that a Disclosing Party deems to be a trade secret is found by a court of competent jurisdiction
not to be a trade secret for purposes of this Article 12, such information shall still be
considered Confidential Information of that Disclosing Party for purposes of this Article 12 to the
extent included within the definition. In the case of trade secrets, each of Buyer, Company, E122
and Shareholders hereby waives any requirement that the other party submit proof of the economic
value of any trade secret or post a bond or other security.

     12.2 RESTRICTED USE OF CONFIDENTIAL INFORMATION

          (a) Each Receiving Party acknowledges the confidential and proprietary nature of the
Confidential Information of the Disclosing Party and agrees that such Confidential Information (i)
shall be kept confidential by the Receiving Party; (ii) shall not be used for any reason or purpose

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other than to evaluate and consummate the Contemplated Transactions; and (iii) without
limiting the foregoing, shall not be disclosed by the Receiving Party to any Person, except in each
case as otherwise expressly permitted by the terms of this Agreement or with the prior written
consent of an authorized representative of Seller Parties with respect to Confidential Information
of Sellers or Shareholders (each, a “Seller Contact”) or an authorized representative of Buyer with
respect to Confidential Information of Buyer (each, a “Buyer Contact”). Each of Buyer, Sellers and
Shareholders shall disclose the Confidential Information of the other party only to its
Representatives who require such material for the purpose of evaluating the Contemplated
Transactions and are informed by Buyer, Sellers or Shareholders, as the case may be, of the
obligations of this Article 12 with respect to such Confidential Information. Each of Buyer,
Sellers and Shareholders shall (x) enforce the terms of this Article 12 as to its respective
Representatives; (y) take such action to the extent necessary to cause its Representatives to
comply with the terms and conditions of this Article 12; and (z) be responsible and liable for any
breach of the provisions of this Article 12 by it or its Representatives.

          (b) Unless and until this Agreement is terminated, Sellers and each Shareholder shall maintain
as confidential any Confidential Information (including for this purpose any information of Sellers
or Shareholders of the type referred to in Sections 12.1(a)(i), (ii) and (iii), whether or not
disclosed to Buyer) of Sellers or Shareholders relating to any of the Assets or the Assumed
Liabilities. Notwithstanding the preceding sentence, Seller Parties may use any Confidential
Information of Seller Parties before the Closing in the Ordinary Course of Business in connection
with the transactions permitted by Section 5.2.

          (c) From and after the Closing, the provisions of Section 12.2(a) above shall not apply to or
restrict in any manner Buyer’s use of any Confidential Information of a Seller Party relating to
any of the Assets or the Assumed Liabilities.

     12.3 EXCEPTIONS

     Sections 12.2(a) and (b) do not apply to that part of the Confidential Information of a
Disclosing Party that a Receiving Party demonstrates (i) was, is or becomes generally available to
the public other than as a result of a breach of this Article 12 by the Receiving Party or its
Representatives; (ii) was or is developed by the Receiving Party independently of and without
reference to any Confidential Information of the Disclosing Party or (iii) was, is or becomes
available to the Receiving Party on a nonconfidential basis from a Third Party not bound by a
confidentiality agreement or any legal, fiduciary or other obligation restricting disclosure. No
Seller Party shall disclose any Confidential Information of a Seller Party relating to any of the
Assets or the Assumed Liabilities in reliance on the exceptions in clauses (ii) or (iii) above.

     12.4 LEGAL PROCEEDINGS

     If a Receiving Party becomes compelled in any Proceeding or is requested by a Governmental
Body having regulatory jurisdiction over the Contemplated Transactions to make any disclosure that
is prohibited or otherwise constrained by this Article 12, that Receiving Party shall provide the
Disclosing Party with prompt notice of such compulsion or request so that it may seek an
appropriate protective order or other appropriate remedy or waive compliance with the provisions of
this Article 12. In the absence of a protective order or other remedy, the Receiving Party may

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EXECUTION VERSION

disclose that portion (and only that portion) of the Confidential Information of the
Disclosing Party that, based upon advice of the Receiving Party’s counsel, the Receiving Party is
legally compelled to disclose or that has been requested by such Governmental Body, provided,
however, that the Receiving Party shall use reasonable efforts to obtain reliable assurance that
confidential treatment will be accorded by any Person to whom any Confidential Information is so
disclosed. The provisions of this Section 12.4 do not apply to any Proceedings between the parties
to this Agreement.

     12.5 RETURN OR DESTRUCTION OF CONFIDENTIAL INFORMATION

     If this Agreement is terminated, each Receiving Party shall (a) destroy all Confidential
Information of the Disclosing Party prepared or generated by the Receiving Party without retaining
a copy of any such material; (b) promptly deliver to the Disclosing Party all other Confidential
Information of the Disclosing Party, together with all copies thereof, in the possession, custody
or control of the Receiving Party or, alternatively, with the written consent of a Seller Contact
or a Buyer Contact (whichever represents the Disclosing Party) destroy all such Confidential
Information; and (c) certify all such destruction in writing to the Disclosing Party, provided,
however, that the Receiving Party may retain a list that contains general descriptions of the
information it has returned or destroyed to facilitate the resolution of any controversies after
the Disclosing Party’s Confidential Information is returned.

     12.6 [INTENTIONALLY OMITTED]

13. General Provisions

     13.1 EXPENSES

     Except as otherwise provided in this Agreement, each party to this Agreement will bear its
respective fees and expenses incurred in connection with the preparation, negotiation, execution
and performance of this Agreement and the Contemplated Transactions, including all fees and
expenses of its Representatives. Buyer will pay all amounts payable to the Title Insurer in
respect of the Title Commitments, copies of exceptions and any title insurance policy, including
premiums (including premiums for endorsements) and search fees. Buyer will pay the HSR Act filing
fee. The Seller Parties and Buyer will each pay one half of the fees and expenses of the escrow
agent under the Escrow Agreement. If this Agreement is terminated, the obligation of each party to
pay its own fees and expenses will be subject to any rights of such party arising from a Breach of
this Agreement by another party.

     13.2 PUBLIC ANNOUNCEMENTS

     Any public announcement, press release or similar publicity with respect to this Agreement or
the Contemplated Transactions will be mutually agreed upon by the parties, except to the extent
Buyer is required by law to made such announcement, filing or press release. Except with the prior
consent of Buyer or as permitted by this Agreement, no Seller Party or any of their Representatives
shall disclose to any Person (a) the fact that any Confidential Information of a Seller Party has
been disclosed to Buyer or its Representatives, that Buyer or its Representatives have inspected
any portion of the Confidential Information of a Seller Party, that any Confidential Information of
Buyer

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has been disclosed to a Seller Party or any of their Representatives or that Seller Parties or
their Representatives have inspected any portion of the Confidential Information of Buyer or (b)
any information about the Contemplated Transactions, including the status of such discussions or
negotiations, the execution of any documents (including this Agreement) or any of the terms of the
Contemplated Transactions or the related documents (including this Agreement). Company and Buyer
will consult with each other concerning the means by which Company’s employees, customers,
suppliers and others having dealings with Company will be informed of the Contemplated
Transactions, and Buyer will have the right to be present for any such communication.

     13.3 NOTICES

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

	 	 	 
	If to Company or E122

	 	Bullen Ultrasonics, Inc./Eaton 122, Ltd.
	(before the Closing):

	 	950 S. Franklin Street
	 

	 	Eaton, Ohio 45320
	 

	 	Attention: Mary A. Bullen
	 

	 	Facsimile:
	 

	 	E-mail address: mbullen@bullen-ultrasonics.com
	 
	 	 
	If to Company or E122

	 	Bullen Ultrasonics, Inc./Eaton 122, Ltd.
	(after the Closing):

	 	1301 Miller-Williams Road
	 

	 	Eaton, Ohio 45320
	 

	 	Attention: Mary A. Bullen
	 

	 	Facsimile:
	 

	 	E-mail address: mbullen@bullen-ultrasonics.com
	 
	 	 
	If to the Shareholders:

	 	1301 Miller-Williams Road
	 

	 	Eaton, Ohio 45320
	 

	 	Attention: Mary A. Bullen
	 

	 	Facsimile:
	 

	 	E-mail address: mbullen@bullen-ultrasonics.com
	 
	 	 
	with a copy to:

	 	Coolidge, Wall Co., L.P.A.
	 

	 	33 W. First Street, Suite 600
	 

	 	Dayton, Ohio 45402
	 

	 	Attention: Glenn L. Bower, Esq.
	 

	 	Facsimile: 937-223-6705
	 

	 	E-mail address: bower@coollaw.com

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EXECUTION VERSION

	 	 	 
	Buyer:

	 	Lam Research Corporation
	 

	 	4650 Cushing Parkway
	 

	 	Fremont, California 94538
	 

	 	Attention: George M. Schisler, Jr.
	 

	 	Director of Legal Services
	 

	 	Facsimile: 510-572-2876
	 

	 	Email: george.schisler@lamrc.com
	 
	 	 
	with a copy to:

	 	Dinsmore & Shohl LLP
	 

	 	1900 Chemed Center
	 

	 	255 E. Fifth Street
	 

	 	Cincinnati, Ohio 45202
	 

	 	Attention: Paul A. Ose, Esq.
	 

	 	Facsimile: 513-977-8141
	 

	 	E-mail address: paul.ose@dinslaw.com

     13.4 [INTENTIONALLY LEFT BLANK]

     13.5 ENFORCEMENT OF AGREEMENT

     The parties each acknowledge and agree that the other party would be irreparably damaged if
any of the provisions of this Agreement are not performed in accordance with their specific terms
and that any Breach of this Agreement by any party could not be adequately compensated in all cases
by monetary damages alone. Accordingly, in addition to any other right or remedy to which either
party may be entitled, at law or in equity, the non-Breaching party shall be entitled to enforce
any provision of this Agreement by a decree of specific performance and to temporary, preliminary
and permanent injunctive relief to prevent Breaches or threatened Breaches of any of the provisions
of this Agreement, without posting any bond or other undertaking.

     13.6 WAIVER; REMEDIES CUMULATIVE

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

84

 

EXECUTION VERSION

     13.7 ENTIRE AGREEMENT AND MODIFICATION

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

     13.8 DISCLOSURE SCHEDULE

          (a) The information in the Disclosure Schedule constitutes (i) exceptions to particular
representations, warranties, covenants and obligations of Seller Parties as set forth in this
Agreement or (ii) descriptions or lists of assets and liabilities and other items referred to in
this Agreement. If there is any inconsistency between the statements in this Agreement and those in
the Disclosure Schedule (other than an exception expressly set forth as such in the Disclosure
Schedule with respect to a specifically identified representation or warranty), the statements in
this Agreement will control.

          (b) The statements in the Disclosure Schedule, and those in any supplement thereto, relate
only to the provisions in the Section of this Agreement to which they expressly relate and not to
any other provision in this Agreement.

     13.9 ASSIGNMENTS, SUCCESSORS AND NO THIRD-PARTY RIGHTS

     No party may assign any of its rights or delegate any of its obligations under this Agreement
without the prior written consent of the other parties, except that Buyer may assign any of its
rights and delegate any of its obligations under this Agreement to any Subsidiary or Related Person
of Buyer provided that Buyer shall remain responsible for all liabilities and obligations not
satisfied by such Subsidiary or Related Person. Subject to the preceding sentence, this Agreement
will apply to, be binding in all respects upon and inure to the benefit of the successors and
permitted assigns of the parties. Nothing expressed or referred to in this Agreement will be
construed to give any Person other than the parties to this Agreement any legal or equitable right,
remedy or claim under or with respect to this Agreement or any provision of this Agreement, except
such rights as shall inure to a successor or permitted assignee pursuant to this Section 13.9.

     13.10 SEVERABILITY

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

     13.11 CONSTRUCTION

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

85

 

EXECUTION VERSION

“Schedules” refer to the corresponding Articles, Sections and Schedules of this Agreement and
the Disclosure Schedule.

     13.12 TIME OF ESSENCE

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

     13.13 GOVERNING LAW

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

     13.14 EXECUTION OF AGREEMENT

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

     13.15 SHAREHOLDER OBLIGATIONS

     Where in this Agreement provision is made for any action to be taken or not taken by either
Seller, Shareholders jointly and severally undertake to cause Sellers to take or not take such
action, as the case may be. Without limiting the generality of the foregoing, Shareholders shall be
jointly and severally liable with Sellers for the indemnities set forth in Article 11.

     13.16 REPRESENTATIVE OF SELLER AND SHAREHOLDERS

          (a) Company, Suzhou, E122 and each Shareholder hereby constitute and appoint MB as their
representative (“Selling Parties’ Representative”) and their true and lawful attorney in fact, with
full power and authority in each of their names and on behalf of each of them:

               (i) to act on behalf of each of them in the absolute discretion of the Selling Parties’
Representative, but only with respect to the following provisions of this Agreement, with the power
to: (A) designate the accounts for payment of the Purchase Price pursuant to Section 2.7(b)(i); (B)
act pursuant to Sections 2.8 and 2.9 with respect to any Purchase Price adjustment; (C) act under
the Escrow Agreement; (D) consent to the assignment of rights under this Agreement in accordance
with Section 13.9; (E) give and receive notices pursuant to Section 13.3; (F) terminate this
Agreement pursuant to Section 9.1 or waive any provision of this Agreement pursuant to Article 8,
Section 9.1 and Section 13.6; (G) accept service of process pursuant to Section 13.4; and (H) act
in connection with any matter as to which Sellers and each of the Shareholders, jointly and
severally, have obligations, or are Indemnified Persons, under Article 11; and

86

 

EXECUTION VERSION

               (ii) in general, to do all things and to perform all acts, including executing and delivering
all agreements, certificates, receipts, instructions and other instruments contemplated by or
deemed advisable to effectuate the provisions of this Section 13.16.

This appointment and grant of power and authority is coupled with an interest and is in
consideration of the mutual covenants made herein and is irrevocable and shall not be terminated by
any act of either of the Shareholders or either Seller or by operation of law, whether by the death
or each incapacity of either Shareholder or by the occurrence of any other event. Each Shareholder
and Seller hereby consents to the taking of any and all actions and the making of any decisions
required or permitted to be taken or made by the Selling Parties’ Representative pursuant to this
Section 13.16.

          (b) Buyer and the escrow agent designated in the Escrow Agreement shall be entitled to rely
upon any document or other paper delivered by the Selling Parties’ Representative as (i) genuine
and correct and (ii) having been duly signed or sent by the Selling Parties’ Representative, and
neither Buyer nor such escrow agent shall be liable to either of the Shareholders or either Seller
for any action taken or omitted to be taken by Buyer or such escrow agent in such reliance.

     13.17 CASUALTY AND CONDEMNATION

     In the event at any time prior to the Closing Date:

          (a) If with respect to any Real Property or Facility, a fire or other casualty (“Casualty”)
shall occur and such Casualty shall cause Material Damage (as herein defined) or condemnation or
eminent domain proceedings shall commence or shall be threatened (“Condemnation”) which are
reasonably expected to cause Material Damage, then Buyer may, at its election, terminate this
Agreement by delivering written notice to either Seller within (i) if Material Damage by Casualty
is applicable, within thirty (30) days after the later of (A) Buyer’s receipt of written notice of
such Casualty or (B) Buyer’s receipt of written notice of a final offer of coverage under policies
of insurance covering the Facility affected by such Casualty; or (ii) if a Condemnation that is
reasonably expected to cause Material Damage is applicable, within thirty (30) days after Buyer’s
receipt of written notice that such Condemnation has been commenced or is threatened, which written
notice shall not be deemed received by Buyer until Buyer shall also have received reasonably
satisfactory written evidence of the amount of the award or other compensation that will be paid or
due to Sellers in connection with such Condemnation. In the event that Buyer terminates this
Agreement as provided in the preceding sentence, neither party shall thereafter have any further
obligations to the other hereunder except as provided in Section 9.2 hereof.

          (b) In the event that any Casualty shall occur or Condemnation shall commence or be threatened
for which Buyer is not entitled to terminate this Agreement as provided in clause (a) above or with
respect to which Buyer is entitled to terminate this Agreement as provided in clause (a) above but
fails to timely exercise such right in accordance with clause (a) above, Buyer shall proceed with
the Closing.

          (c) For purposes hereof, “Material Damage” shall mean: (i) in case of a Casualty, any damage, as reasonably estimated by Buyer, that would cost for the
Facility affected by such

87

 

EXECUTION VERSION

Casualty more than Two Million Five Hundred Thousand Dollars ($2,500,000)
in repairs or that would otherwise have a material adverse effect on the Assets or Business; and
(ii) in the case of a Condemnation, would likely result in an award to Seller in an amount in
excess of Two Million Five Hundred Thousand Dollars ($2,500,000) or would otherwise have a material
adverse effect on the Assets or Business.

     (d) In the event Buyer is required under clause (b) above to proceed with the Closing, (i) if
a Casualty is applicable, at Closing, Buyer shall receive the affected Facility in its then
existing condition and Buyer will be entitled to receive all insurance money paid and, to the
extent not yet paid, an assignment of all insurance money payable to Sellers, or either of them,
under all policies of insurance covering such Facility as a result of and with respect to the
damage or destruction of such Facility caused by such Casualty and a credit against the Purchase
Price in the amount of any applicable deductible; or (ii) if Condemnation is applicable, at
Closing, Buyer shall be entitled to all proceeds, awards or compensation paid and, to the extent
not yet paid, an assignment of all proceeds, awards or compensation payable to Sellers, or either
of them, as a result of and with respect to such Condemnation.

     13.18 PRORATIONS

          (a) At the Closing, Buyer and Sellers shall reimburse each other, as appropriate, for the
following expenses applicable to the Assets, all of which shall be prorated such that Sellers are
responsible for the expenses accrued on or prior to the Closing Date and Buyer is responsible for
expenses accrued after the Closing Date:

               (i) all real estate taxes and assessments applicable to the Real Property, including taxes for
the calendar year of Closing that are a lien against the Real Property but not due and payable
until the following calendar year, provided, that in any case and notwithstanding anything in this
Agreement to the contrary, Seller shall be responsible for all Taxes and assessments that are a
lien against the Real Property but not yet due for years prior to the Closing Date, and a portion
of such Taxes and assessments for the year of Closing, prorated on a daily basis through the
Closing Date;

               (ii) all personal property taxes;

               (iii) utility expenses applicable to the Real Property;

               (iv) rent payments and any common area charges or other similarly pro-rated charges due under
the Leases that are part of the Acquired Contracts (including percentage rent on an annualized
basis, as may be adjusted for recaptured landlord allowances); and

               (v) any other items customarily prorated, as mutually agreed upon by the parties.

          (b) If there are water, gas or electric meters located at any of the Real Property, Sellers
shall obtain readings thereof to a date not more than thirty (30) days prior to the Closing Date
and the unfixed water rates and charges, sewer taxes and rents and gas and electricity charges, if
any, based thereon for the intervening time shall be apportioned on the basis of such readings. If
such
readings are not obtainable by the Closing Date, then, at the Closing, any water rates and
charges,

88

 

EXECUTION VERSION

sewer taxes and rents and gas and electricity charges which are based on such readings
shall be prorated based upon the per diem charges obtained by using the most recent period for
which such readings shall then be available. Upon the taking of subsequent actual readings, the
apportionment of such charges shall be recalculated and Sellers or Buyer, as the case may be,
promptly shall make a payment to the other based upon such recalculations. The parties agree to
make such final recalculations within ninety (90) days after the Closing Date, which obligation
shall survive the Closing.

          (c) If any refunds of real property taxes or assessments, water rates and charges or sewer
taxes and rents shall be made after the Closing, the same shall be held in trust by Sellers or
Buyer, as the case may be, and shall first be applied to the unreimbursed costs incurred in
obtaining the same, then the balance, if any, shall be paid to Sellers (for the period on or prior
to the Closing Date) and to Buyer (for the period commencing after the Closing Date).

          (d) If, on the Closing Date, any of the Real Property shall be or shall have been affected by
any special or general assessment or assessments or real property taxes payable on a lump sum or
which are or may become payable in installments of which the first installment is then a charge or
lien and has become payable, Sellers shall pay or cause to be paid at the Closing the unpaid
installments of such assessments, including those which are to become due and payable after the
Closing Date.

          (e) No insurance policies of Sellers are to be transferred to Buyer, and no apportionment of
the premiums therefor shall be made.

          (f) If any of the foregoing items to be prorated under this Section 13.18 cannot be prorated
at the Closing because of the unavailability of the amounts which are to be prorated, such items
shall be prorated on the basis of a good faith estimate by the parties and adjusted and reconciled
as soon as practicable after the Closing Date; provided, however, all such adjustments and
reconciliations shall occur no later than one (1) year after the Closing Date.

[signature page follows]

89

 

EXECUTION VERSION

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

	 	 	 	 	 	 	 	 	 
	SELLERS:	 	BUYERS:	 	 
	 
	 	 	 	 	 	 	 	 
	Bullen Ultrasonics, Inc.	 	Lam Research Corporation	 	 
	 
	 	 	 	 	 	 	 	 
	/s/ Stephen K. Brown	 	/s/ Stephen G. Newberry	 	 
	 	 	 	 	 
	By:

	 	Stephen K. Brown 	 	By:	 	Stephen G. Newberry 	 	 
	 	 	 	 	 	 	 	 	 
	Title:

	 	President 	 	Title:	 	President and Chief Executive Officer 	 	 
	 	 	 	 	 	 	 	 	 

Eaton 122, Ltd.

	 	 	 	 	 
	/s/ Mary A. Bullen 	 	 	 	 
	 	 	 
	By:

	 	Mary A. Bullen 	 	 
	 	 	 	 	 
	Title:
	 	Partner 	 	 
	 	 	 	 	 

Bullen Semiconductor (Suzhou) Co., Ltd.

	 	 	 	 	 
	/s/ Stephen K. Brown 	 	 	 	 
	 	 	 
	By:

	 	Stephen K. Brown 	 	 
	 	 	 	 	 
	Title:
	 	President 	 	 
	 	 	 	 	 

Shareholders

	 	 	 	 	 
	/s/ Mary A. Bullen 	 	/s/ Vicki A. Brown 	 	 
	 	 	 	 	 
	Mary A. Bullen, individually

	 	Vicki A. Brown, individually
	 	 

90

 

TABLE OF SCHEDULES

	 	 	 	 	 	 
	 
	 	Schedule	 	 	Description	 
	 	Schedule 2.1(b) — Tangible
Personal Property
 

	 	 	List of fixed asset of Company and Suzhou used in the
Business as of June 30, 2006	 
	 	Schedule 2.1(c) — Inventories
as of July 31, 2006
 

	 	 	Inventories of Company and Suzhou as of July 31, 2006	 
	 	Schedule 2.1(d) — Prepaid
Assets as of July 31, 2006
 

	 	 	Prepaid Assets of Company and Suzhou as of July 31, 2006	 
	 	Schedule 2.1(e) — Acquired
Contracts 
 

	 	 	List of Contracts of Company and Suzhou to be acquired	 
	 	Schedule 2.1(j) — Claims
Against Third Parties
 

	 	 	List of claims against Third Parties relating to the
Assets or Business	 
	 	Schedule 2.1(k) — Claims by
Sellers 
 

	 	 	List of claims of any Seller Party relating to the
Assets or Business	 
	 	Schedule 2.2(f) — Retained
Contracts 
 

	 	 	List of Company Contracts retained by Sellers and not
part of the sale	 
	 	Schedule 2.2(m) — Excluded
Assets 
 

	 	 	List of property and assets of Sellers retained by
Sellers and not part of the sale	 
	 	Schedule 2.4(a)(v) — Accrued
Vacation and Personal Days
 

	 	 	Dollar value of accrued vacation and personal days of
employees of Company and Suzhou as of September 30, 2006	 
	 	Schedule 3.1(a) — Organization
and Good Standing 
 

	 	 	List of jurisdictions of organization and good standing
for Company and Suzhou	 
	 	Schedule 3.1(b) — Governing
Documents of each Seller
 

	 	 	Copies of Governing Documents of each Seller	 
	 	Schedule 3.1(c) — Subsidiaries 
 

	 	 	List of Subsidiaries of Company	 
	 	Schedule 3.1(d) — Related
Persons 
 

	 	 	Description of interest and business relationships of
Shareholders and Related Persons in or with any Person
or Related Person	 
	 	Schedule 3.2(a) — Certified
Resolutions 
 

	 	 	Copies of board and shareholder resolutions of Sellers	 
	 

SCHEDULES TO THIS AGREEMENT ARE OMITTED FROM THIS FILING. LAM RESEARCH CORPORATION UNDERTAKES TO
PROVIDE COPIES OF THE OMITTED SCHEDULES TO THE SECURITIES AND EXCHANGE COMMISSION UPON REQUEST
OF THE COMMISSION.

 

 

	 	 	 	 	 	 
	 
	 	Schedule	 	 	Description	 
	 	Schedule 3.2(b) — Consummation
of Contemplated Transactions
 

	 	 	Description of certain Taxes resulting from consummation
of the transaction and description of consents needed to
consummate the transaction	 
	 	Schedule 3.2(c) — Notice or
Consent 
 

	 	 	List and description of notices and consents necessary
to consummate the transaction	 
	 	Schedule 3.3(a) — Capitalization

 

	 	 	Description of shareholder agreements and operating
agreements of Sellers	 
	 	Schedule 3.6 — Sufficiency of
Assets 
 

	 	 	Description of any exceptions to the sufficiency of
assets representation	 
	 	Schedule 3.7 — Description of
Owned Real Property 
 

	 	 	Street address, parcel identification and legal
description of all owned Real Property	 
	 	Schedule 3.8 — Description of
Leased Real Property
 

	 	 	Street address, parcel identification and legal
description of all leased Real Property	 
	 	Schedule 3.9(a) — Real Estate
Encumbrances 
 

	 	 	Description of Encumbrances on Real Property	 
	 	Schedule 3.9(b) — Permitted
Real Estate Encumbrances
 

	 	 	Description of Permitted Encumbrances on Real Property	 
	 	Schedule 3.9(c) — Non-Real
Estate Encumbrances 
 

	 	 	Description of Encumbrances on Assets other than Real
Property	 
	 	Schedule 3.9(d) — Construction
Agreement
 

	 	 	Copy of the Construction Agreement	 
	 	Schedule 3.10(a) — Condition of
Facilities 
 

	 	 	Description of any exceptions to the condition of
Facilities representation	 
	 	Schedule 3.10(b) — Production
Output Requirements & Processes
and Facilities Standards
 

	 	 	List and description of certain equipment of Company;
description of Company technical specification
compliance; description of personal property moved
between Franklin Street Property and Camden Road
Property in the last 12 months	 
	 	Schedule 3.11(a) — Accounts
Receivable
 

	 	 	List of accounts receivable of Company and Suzhou
relating to the Business as of June 30, 2006	 
	 	Schedule 3.11(b) — Ten Largest
Customers 
 

	 	 	List of Company’s and Suzhou’s 10 largest customers,
excluding Buyer as of June 30, 2006	 
	 

SCHEDULES TO THIS AGREEMENT ARE OMITTED FROM THIS FILING. LAM RESEARCH CORPORATION UNDERTAKES TO
PROVIDE COPIES OF THE OMITTED SCHEDULES TO THE SECURITIES AND EXCHANGE COMMISSION UPON REQUEST
OF THE COMMISSION.

 

 

	 	 	 	 	 	 
	 
	 	Schedule	 	 	Description	 
	 	Schedule 3.13 — Undisclosed
Liabilities 
 

	 	 	Description of Liabilities of Sellers not reflected on
Sellers’ balance sheets	 
	 	Schedule 3.14(a) — Taxes

 Schedule 3.14(b) — Tax
Returns
 

	 	 	Description of any exceptions to the Taxes representation
List of Tax Returns filed by Company and Suzhou since
January 1, 1999	 
	 	Schedule 3.15 — Material
Adverse Change
 

	 	 	Description of material adverse changes affecting
Company or Suzhou since December 31, 2005	 
	 	Schedule 3.16(a) — Employee
Benefit Plans 
 

	 	 	Description of Company’s employee benefit plans	 
	 	Schedule 3.16(e) — Employee
Benefit Plans — Compliance
 

	 	 	Description of noncompliance relating to Company’s
employee benefit plans	 
	 	Schedule 3.16(g) — Workers’
Compensation Coverage
 

	 	 	Description of Company’s workers’ compensation coverage	 
	 	Schedule 3.17(a) — Compliance
With Legal Requirements;
Governmental Authorizations 
 

	 	 	Description of any noncompliance with Legal Requirements
and Governmental Authorizations	 
	 	Schedule 3.17(b) — Governmental
Authorizations 
 

	 	 	Description of each Governmental Authorization held by
Sellers	 
	 	Schedule 3.17(c) -
Non-Transferred Governmental
Authorizations 
 

	 	 	List of Governmental Authorizations retained by Sellers
and not included in the sale	 
	 	Schedule 3.18(a) — Pending or
Threatened Proceedings 
 

	 	 	Description of any pending and threatened legal
proceedings against Sellers	 
	 	Schedule 3.18(b) — Pending
Orders 
 

	 	 	Description of any pending Orders against Sellers, the
Business or Assets	 
	 	Schedule 3.18(c) — Compliance
with Orders 
 

	 	 	Description Sellers compliance with Orders	 
	 	Schedule 3.19 — Absence of
Certain Changes and Events
 

	 	 	Description of any exceptions to the absence of certain
changes and events representation	 
	 	Schedule 3.20(a) — Contracts

 

	 	 	List and description of Contracts of Company and Suzhou	 
	 

SCHEDULES TO THIS AGREEMENT ARE OMITTED FROM THIS FILING. LAM RESEARCH CORPORATION UNDERTAKES TO
PROVIDE COPIES OF THE OMITTED SCHEDULES TO THE SECURITIES AND EXCHANGE COMMISSION UPON REQUEST
OF THE COMMISSION.

 

 

	 	 	 	 	 	 
	 
	 	Schedule	 	 	Description	 
	 	Schedule 3.20(b) — Shareholder
Rights Under any Contract

 

	 	 	Description of Shareholders rights under any Contract
relating to the Business	 
	 	Schedule 3.20(c) — Full Force
and Effect; Contracts

 

	 	 	Description of any exceptions to the representation
regarding full force and effect and assignability of
Contracts	 
	 	Schedule 3.20(d) — Compliance

 

	 	 	Description of any exceptions to the representation
regarding Sellers’ compliance and counterparty
compliance with Contracts	 
	 	Schedule 3.21(a) — Insurance

 

	 	 	Description of Company and Suzhou insurance coverage	 
	 	Schedule 3.21(b) — Insurance

 

	 	 	Description of any self-insurance, Contract for transfer
of risk and obligation of Company to provide insurance
coverage to Third Parties	 
	 	Schedule 3.21(c) — Insurance

 

	 	 	Description of Company’s insurance loss history	 
	 	Schedule 3.21(d) — Insurance

 

	 	 	Description of any exceptions to validity,
enforceability and legality of Company’s insurance
policies	 
	 	Schedule 3.22 — Environmental
Matters
 

	 	 	Description of Sellers’ Phase I environmental reports	 
	 	Schedule 3.23(a) — Employee List

 

	 	 	List and description of employees of Company and Suzhou
relating to the Business	 
	 	Schedule 3.23(b) — Retired
Employees
 

	 	 	Description of benefits due to retired employees of
Company and Suzhou; and list of any retired employees	 
	 	Schedule 3.23(c) — Terminated
Employees
 

	 	 	List and description of employees terminated by Company
and Suzhou since December 31, 2004	 
	 	Schedule 3.23(f) — Employee
Development Agreement and
Employee Invention Rights
Agreement
 

	 	 	Form of Employee Development Agreement and Employee
Invention Rights Agreement; and list of employees of
Company who have executed same	 
	 	Schedule 3.24(b) — Labor Matters

 

	 	 	Description of any labor matters relating to Company or
Suzhou	 
	 	Schedule 3.25(a) — Intellectual
Property Assets
 

	 	 	List and description of Intellectual Property Assets	 
	 	Schedule 3.25(b) — License
Agreements 
 

	 	 	List and description of license agreements of Company
and Suzhou	 
	 

SCHEDULES TO THIS AGREEMENT ARE OMITTED FROM THIS FILING. LAM RESEARCH CORPORATION UNDERTAKES TO
PROVIDE COPIES OF THE OMITTED SCHEDULES TO THE SECURITIES AND EXCHANGE COMMISSION UPON REQUEST
OF THE COMMISSION.

 

 

	 	 	 	 	 	 
	 
	 	Schedule	 	 	Description	 
	 	Schedule 3.25(c) — Intellectual
Property Assets
 

	 	 	Description of any exceptions to the sufficiency and
ownership representations relating to intellectual
property	 
	 	Schedule 3.25(d) — Patents 
 

	 	 	List and description of Patents	 
	 	Schedule 3.25(e) — Marks
 

	 	 	List and description of Marks	 
	 	Schedule 3.25(f) — Copyrights

 

	 	 	List and description of Copyrights	 
	 	Schedule 3.25(g) — Standard
Employee Confidentiality
Agreement
 

	 	 	Form of Employee Confidentiality Agreement of Company
and Suzhou; and list of employees of Company and Suzhou
who have executed same	 
	 	Schedule 3.25(h) — Domain Rights

 

	 	 	List and description of Domain Rights	 
	 	Schedule 3.25(i) — Excluded IP

 

	 	 	List and description of Excluded Intellectual Property	 
	 	Schedule 3.26(b) — Payments to
Third Parties
 

	 	 	Description of any exceptions to the representation
relating to payments to Third Parties	 
	 	Schedule 3.26(d) — Compliance
re: Export Control
 

	 	 	Description of any exceptions to the representation
relating to compliance with export control and trade
embargoes Legal Requirements	 
	 	Schedule 3.26(e) — Antiboycott
Violations
 

	 	 	Description of any exceptions to the representation
relating to compliance with antiboycott Legal
Requirements	 
	 	Schedule 3.27 — Related Persons

 

	 	 	Description of any exceptions to the representation
relating to interest of Sellers, Shareholders or Related
Persons in any property used in Company’s or Suzhou’s
business	 
	 	Schedule 3.31 — DISC
 

	 	 	List and description of any material assets, property,
liabilities or operations of DISC	 
	 	Schedule 5.14
- [***]
 

	 	 	[***]	 
	 	Schedule 7.3 — Material Consents

 

	 	 	List and description of Material Consents and
Governmental Authorizations to be received as a
condition to Buyer’s closing obligations	 
	 	Schedule 7.15 — LRC China

 

	 	 	Description of the business license of LRC China	 
	 	Schedule 8.3 — Consents

 

	 	 	List and description of Consents to be received as a
condition to Seller Parties’ closing obligations	 
	 

SCHEDULES TO THIS AGREEMENT ARE OMITTED FROM THIS FILING. LAM RESEARCH CORPORATION UNDERTAKES TO
PROVIDE COPIES OF THE OMITTED SCHEDULES TO THE SECURITIES AND EXCHANGE COMMISSION UPON REQUEST
OF THE COMMISSION.

THE SYMBOL [***] IS USED TO INDICATE THAT A PORTION OF THE EXHIBIT HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE
OMITTED PORTION.exv10w2

 

Exhibit 10.2

EXECUTION VERSION

FIRST AMENDMENT TO ASSET PURCHASE AGREEMENT

     This Amendment to Asset Purchase Agreement (this “Amendment”) is dated October 5 2006, by and
among Lam Research Corporation, a Delaware corporation (“LRC”), and/or one or more of its
designated affiliates (collectively, “Buyer”), Bullen Ultrasonics, Inc., an Ohio corporation
(“Company”), Eaton 122 Ltd., an Ohio limited liability company (“E122”), Bullen Semiconductor
(Suzhou) Co., Ltd., a wholly foreign owned enterprise established in Suzhou New District, Suzhou,
Jaingsu, PRC (“Suzhou) (Company, E122 and Suzhou are sometimes referred to as “Seller”
individually or “Sellers” collectively), Mary A. Bullen, a resident of Camden, Ohio (“MB”) and
Vicki A. Brown, a resident of Eaton, Ohio (“VB”) (Company, E122, Suzhou, MB and VB are referred to
herein as “Seller Parties” collectively, and “Seller Party” individually).

RECITALS

     Buyer and Seller Parties are parties to that certain Asset Purchase Agreement, dated October
5, 2006 (the “Agreement”), pursuant to which Buyer has agreed to purchase, and Seller Parties have
agreed to sell, certain assets of Company, E122 and Suzhou. Capitalized terms used in this
Amendment and not otherwise defined herein shall have the meanings assigned to them in the
Agreement.

     Buyer and Seller Parties mutually acknowledge that, due to certain Chinese Legal Requirements,
the required Governmental Authorizations necessary for the purchase by Buyer and the sale by Suzhou
of the Assets of Suzhou, as contemplated by the Agreement, cannot be obtained prior to the date
Buyer and Seller Parties originally intended to close the purchase and sale transactions
contemplated by the Agreement.

     Buyer and Seller Parties desire to amend the Agreement as set forth herein such that, among
other things, the closing of the purchase and sale of the Assets of Company and E122 and the
closing of the purchase and sale of the Assets of Suzhou, each as contemplated in the Agreement,
will be bifurcated and will take place in separate closings on separate dates.

     NOW THEREFORE, in consideration of the foregoing and the promises, covenants and agreements
set forth herein and in the Agreement, the parties, intending to be legally bound, agree as
follows:

1. The closing of the purchase and sale of the Assets of Company and E122 (the “US Assets”) (the
“US Closing”), and the closing of the purchase and sale of the Assets of Suzhou (the “Suzhou
Assets”) (the “Suzhou Closing”), shall occur in separate closings. The term “Closing Date,” when
used in the Agreement, shall mean the US Closing with respect to the closing of the purchase and
sale of the US Assets and shall mean the Suzhou Closing with respect to the closing of the purchase
and sale of the Suzhou Assets.

2. The US Closing shall take place as provided for in and in accordance with Section 2.6 of the
Agreement, provided, however, the conditions set forth in Section 7.15 of the
Agreement shall not be conditions precedent to Buyer’s obligation to purchase the US Assets and the
US

THE
SYMBOL [***] IS USED TO INDICATE THAT A PORTION OF THE EXHIBIT HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED
PORTION.

 

 

Closing. The conditions set forth in Section 7.15 of the Agreement shall be conditions precedent
to the Buyer’s obligation to purchase the Suzhou Assets and the Suzhou Closing.

3. The Suzhou Closing shall take place within five (5) Business Days after the satisfaction or
waiver, in accordance with the terms and provisions of the Agreement, of each of the conditions
precedent of Buyer and Seller Parties, as they relate to the Suzhou Assets, set forth in Sections 7
and 8, respectively, specifically including the satisfaction of the conditions precedent set forth
in Section 7.15 of the Agreement. Without limiting the foregoing, a breach or default of the
Seller Parties solely with respect the US Assets and/or the representations and warranties related
thereto following the US Closing, shall not be deemed a breach of the conditions of the Suzhou
Closing.

4. The purchase price for the Suzhou Assets shall be Two Million Five Hundred Thousand Dollars
$2,500,000, payable in rmnb to the extent required by Chinese Legal Requirements (the “Suzhou
Assets Purchase Price”), which shall be paid by wire transfer on the date of the Suzhou Closing to
an account specified in writing by the Selling Parties’ Representative. The amount of the Suzhou
Assets Purchase Price shall be deducted from, and shall reduce on a dollar-for-dollar basis, the
amount set forth in Section 2.7(b)(i) to be paid to Company. The Buyer and Seller Parties agree
that the amount of the Suzhou Assets Purchase Price shall not affect, in any respect, the amounts
set forth in Sections 2.7(b)(ii) — (v).

5. Sections 9.1(f) and (g) are hereby amended to grant to each of Buyer and Seller Parties the
right to terminate the Agreement, subject to the proviso that the terminating party is not in
material Breach of the Agreement, if the Suzhou Closing has not occurred on or prior to October 31,
2007, provided, however, such extended termination right shall only apply with
respect to the Suzhou Assets and the Suzhou Closing.

6. Notwithstanding the bifurcated closings provided for in this Amendment, each of the
representations, warranties, covenants, conditions (except for the condition in Section 7.15 which
shall not apply to the US Closing) and obligations of Seller Parties, including without limitation,
the covenants set forth in Section 5.2 and 5.6, shall apply to both the US Assets and the Suzhou
Assets and shall remain in full force and effect, respectively until each closing has occurred.
Without limiting the foregoing, the survival periods of the representations, warranties, covenants
and obligations of Seller Parties set forth in Section 11.1, as they relate to the Suzhou Assets,
shall be effective from the date of the Suzhou Closing.

7. The terms and provisions of Sections 2.8 and 2.9 of the Agreement shall not apply to the Suzhou
Closing. The parties mutually agree that the determination of the Adjustment Amount, and the
completion of the procedures for determining the Adjustment Amount, shall be done in connection
with the US Closing only, and not in connection with the Suzhou Closing, provided,
however, the determination of the Adjustment Amount, and the completion of the procedures
for determining the Adjustment Amount, including but not limited to the Closing Asset Value and the
Estimated Closing Asset Value, will include the Suzhou Assets at the time of the US Closing only.

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8. The Purchase Price allocation provided for in Section 2.5 of the Agreement shall be prepared and
furnished by Buyer, with respect to the US Assets, within forty-five (45) days after the US
Closing, and shall be prepared and furnished by Buyer, with respect to the Suzhou Assets, within
forty-five (45) days after the Suzhou Closing. Except as expressly provided herein, the terms and
provisions of Section 2.5 of the Agreement remain unchanged and in full force and effect.

9. Notwithstanding the bifurcated closings provided for in this Amendment, the Threshold and the
indemnification limitations set forth in Section 11.5 of the Agreement shall be determined on a
consolidated and aggregate basis, including claims with respect to the Company and Suzhou, as if
the closing of the US Assets and the Suzhou Assets had not been separated.

10. From and after the US Closing, and continuing until the Suzhou Closing, Suzhou and/or Company
agree to sell and deliver to Buyer and/or to an affiliate of Buyer all of the goods and services of
Suzhou, as may be requested or ordered from time to time by Buyer, at a price equal to the sum of
(a) Suzhou’s monthly net cost for such goods and services (“costs of good sold”) and (b) the
monthly net operating expenses (“Operating Expenses”) of Suzhou prior to the Suzhou Closing or the
earlier termination of the Agreement and this Amendment, with respect to the Suzhou Assets, subject
to a monthly maximum payment by Buyer of US [***] with respect to such total Operating Expenses.
Additionally, any profits realized by Suzhou related to third party customer sales, in such month,
shall be deducted from the monthly payment due from Buyer. The payment pursuant to clause (b) of
this paragraph 10, or the reduction pursuant to clause (c) of this paragraph 10 will be made or
taken by Buyer respectively on a monthly basis within twenty (20) days after the receipt of the
monthly income statement of Suzhou, certified by an officer of the Company, which income statement
sets forth the net operating loss or profits, as the case may be, of Suzhou in the prior month. If
goods and services are sold by Suzhou to Company and/or resold, or otherwise by or through
subsidiaries or affiliates, “profits” shall be measured or determined on an aggregate basis, taking
into account all transactions. Buyer and Seller Parties mutually intend this Section 10 to serve
as a means for Buyer to obtain the goods and services from Suzhou in a manner and at the cost and
on the terms that Company previously obtained such goods and services from Suzhou. Additionally,
Buyer agrees to reimburse Suzhou and/or Company at the Suzhou Closing for capital expenditures and
payments made by Suzhou and/or Company to [***] after the US
Closing and prior to the Suzhou Closing, pursuant to (i) Contract No. [***] between Suzhou and
[***] dated August 8, 2006, for the purchase of two
(2) [***], and (ii) Contract No. [***] between Suzhou and [***] dated August 29, 2006, for the
purchase of one (1) [***], provided such capital expenditures and payments
are not included in the Closing Asset Value.

11. “Material Damage”, for the purposes of the Suzhou Closing shall be as defined in Section 13.17
of the Agreement, except that the amount shall be $250,000. “Material”, “materially” and
“materiality” as referenced in Section 1.2(d) of the Agreement, when referencing the Suzhou Closing
shall refer to, or be construed in reference to the business, asset or operations of Suzhou.

12. The term and termination of the Escrow Agreement shall not be extended by virtue of the Suzhou
Closing.

THE
SYMBOL [***] IS USED TO INDICATE THAT A PORTION OF THE EXHIBIT HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTION.

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13. The Guarantees shall be applicable to all obligations of the Company and Suzhou and shall not
be affected or diminished by the terms and provisions of this Amendment.

14.      (a) The defined terms used herein shall be the same meanings given to them in the Agreement
except to the extent expressly provided herein.

     (b) The terms and conditions of the Agreement shall remain in full force and effect except to
the extent expressly provided herein.

     (c) It is the intent of the parties that the terms, conditions, representations, warranties
and covenants in the Agreement shall apply, respectively, to the sale and purchase of the Suzhou
Assets, to and at the time of the Suzhou Closing, and as to the sale and purchase of the US Assets,
to and at the time of the US Closing, except to the extent expressly provided herein.

15. If the Suzhou Closing has not occurred on or before October 31, 2007, then after such date
Seller Parties may sell the Suzhou Assets to a third party and such sale shall not be deemed a
breach or default of the Noncompetition Agreements. The parties agree that all intangible rights
and properties, including the Intellectual Property Assets included in the Assets as defined in the
Agreement (but excluding the Excluded IP) shall be deemed US Assets sold to Buyer as part of the US
Closing and neither the Company or Suzhou shall have any rights or interests with respect thereto.

16. Seller Parties and Buyer agree to use their mutual best efforts, consistent with the terms of
the Agreement and this Amendment, to satisfy the conditions in Section 7.15 of the Agreement.

17. Seller Parties agree to operate Suzhou in the Ordinary Course of Business. Without limiting
the foregoing, Suzhou will not sell or market products or services to Third Parties in amounts or
volumes inconsistent with its prior sales to Third Parties. In addition, if Suzhou and Buyer agree
to materially increase the sales or production of Suzhou from the historical levels of the prior
twelve months, Suzhou and Buyer agree to negotiate in good faith an increase in the maximum payment
of net operating losses by Buyer contained in paragraph 10(b).

18. Except as set forth herein, all terms of the Agreement shall remain unchanged and in full force
and effect.

[signature page follows]

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	SELLERS:	 	BUYERS:	 	 
	 
	 	 	 	 	 	 	 	 
	Bullen Ultrasonics, Inc.	 	Lam Research Corporation	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	/s/ Stephen K. Brown 	 	 	 	/s/ Stephen G. Newberry 	 	 
	 	 	 	 	 	 	 	 	 
	By:

	 	Stephen K. Brown 	 	By:	 	Stephen G. Newberry 	 	 
	 	 	 	 	 	 	 	 	 
	Title:

	 	President 	 	Title:	 	President and Chief Executive Officer 	 	 
	 	 	 	 	 	 	 	 	 

Eaton 122, Ltd.

	 	 	 	 	 
	 	 	 
	 

	 	/s/ Mary A. Bullen 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	By:

	 	Mary A. Bullen 	 	 
	 	 	 	 	 
	Title:
	 	Partner 	 	 
	 	 	 	 	 

Bullen Semiconductor (Suzhou) Co., Ltd.

	 	 	 	 	 
	 

	 	/s/ Stephen K. Brown 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	By:

	 	Stephen K. Brown 	 	 
	 	 	 	 	 
	Title:
	 	President 	 	 
	 	 	 	 	 

Shareholders

	 	 	 	 	 
	/s/ Mary A. Bullen

	 	/s/ Vicki A. Brown
	 	 
	 	 	 	 	 
	Mary A. Bullen, individually

	 	Vicki A. Brown, individually
	 	 

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