Document:

exv4w7

 

Exhibit 4.7

EXECUTION COPY

REGISTRATION RIGHTS AGREEMENT

     This REGISTRATION RIGHTS AGREEMENT dated August 20, 2004 (the “Agreement”) is entered into by
and among Standard Aero Holdings, Inc., a Delaware corporation (the “Company”), the guarantors
listed in Schedule 1 hereto or that may later become a party hereto pursuant to a joinder agreement
(the “Guarantors”), and J.P. Morgan Securities Inc. (“JPMorgan”), Lehman Brothers, Inc. and Credit
Suisse First Boston LLC (the “Initial Purchasers”).

     The Company, the Guarantors and the Initial Purchasers are parties to the Purchase Agreement
dated August 17, 2004 (the “Purchase Agreement”), which provides for the sale by the Company to the
Initial Purchasers of $200,000,000 aggregate principal amount of the Company’s 81/4% Senior
Subordinated Notes due 2014 (the “Securities”) which will be guaranteed on an unsecured senior
subordinated basis by each of the Guarantors. As an inducement to the Initial Purchasers to enter
into the Purchase Agreement, the Company and the Guarantors have agreed to provide to the Initial
Purchasers and their direct and indirect transferees the registration rights set forth in this
Agreement. The execution and delivery of this Agreement is a condition to the closing under the
Purchase Agreement. The representations, warranties and obligations of and relating to each of the
Guarantors shall not become effective until the Acquisition Closing (as defined in the Purchase
Agreement), at which time such representations, warranties and agreements shall become effective
pursuant to the terms of a joinder agreement as required by Section 6(j) of this Agreement and
thereafter all representations, warranties, agreements and obligations of the Company and the
Guarantors hereunder shall be joint and several.

     In consideration of the foregoing, the parties hereto agree as follows:

     1. Definitions. As used in this Agreement, the following terms shall have the
following meanings:

     “Business Day” shall mean any day that is not a Saturday, Sunday or other day on which
commercial banks in New York City are authorized or required by law to remain closed.

     “Closing Date” shall mean the Closing Date as defined in the Purchase Agreement.

     “Company” shall have the meaning set forth in the preamble and shall also include the
Company’s successors.

 

 

     “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended from time to time.

     “Exchange Dates” shall have the meaning set forth in Section 2(a)(ii) hereof.

     “Exchange Offer” shall mean the exchange offer by the Company and the Guarantors of Exchange
Securities for Registrable Securities pursuant to Section 2(a) hereof.

     “Exchange Offer Registration” shall mean a registration under the Securities Act effected
pursuant to Section 2(a) hereof.

     “Exchange Offer Registration Statement” shall mean an exchange offer registration statement on
Form S-4 (or, if applicable, on another appropriate form) and all amendments and supplements to
such registration statement, in each case including the Prospectus contained therein, all exhibits
thereto and any document incorporated by reference therein.

     “Exchange Securities” shall mean senior subordinated Securities issued by the Company and
guaranteed by the Guarantors under the Indenture containing terms identical in all material
respects to the Securities (except that the Exchange Securities will not be subject to restrictions
on transfer or to any increase in annual interest rate for failure to comply with this Agreement)
and to be offered to Holders of Securities in exchange for Securities pursuant to the Exchange
Offer.

     “Guarantors” shall have the meaning set forth in the preamble and shall also include any
Guarantors’ successors.

     “Holders” shall mean the Initial Purchasers, for so long as they own any Registrable
Securities, and each of their successors, assigns and direct and indirect transferees who become
owners of Registrable Securities under the Indenture; provided that for purposes of Sections 2, 4
and 5 of this Agreement, the term “Holders” shall include Participating Broker-Dealers.

     “Indenture” shall mean the Indenture relating to the Securities dated as of August 20, 2004
among the Company, Wells Fargo Bank, National Association, as trustee, and the Guarantors that
become a party thereto by supplemental indentures as required pursuant to the Purchase Agreement,
as the same may be amended from time to time in accordance with the terms thereof.

     “Initial Purchasers” shall have the meaning set forth in the preamble.

     “Inspector” shall have the meaning set forth in Section 3(a)(xiii) hereof.

     “JPMorgan” shall have the meaning set forth in the preamble.

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     “Majority Holders” shall mean the Holders of a majority of the aggregate principal amount of
the outstanding Registrable Securities; provided that whenever the consent or approval of Holders
of a specified percentage of Registrable Securities is required hereunder, any Registrable
Securities owned directly or indirectly by the Company or any of its affiliates shall not be
counted in determining whether such consent or approval was given by the Holders of such required
percentage or amount; and provided, further, that if the Company shall issue any additional
Securities under the Indenture prior to consummation of the Exchange Offer or, if applicable, the
effectiveness of any Shelf Registration Statement, such additional Securities and the Registrable
Securities to which this Agreement relates shall be treated together as one class for purposes of
determining whether the consent or approval of Holders of a specified percentage of Registrable
Securities has been obtained.

     “Participating Broker-Dealers” shall have the meaning set forth in Section 4(a) hereof.

     “Person” shall mean an individual, partnership, limited liability company, corporation, trust
or unincorporated organization, or a government or agency or political subdivision thereof.

     “Prospectus” shall mean the prospectus included in a Registration Statement, including any
preliminary prospectus and any such prospectus as amended or supplemented by any prospectus
supplement, including a prospectus supplement with respect to the terms of the offering of any
portion of the Registrable Securities covered by a Shelf Registration Statement, and by all other
amendments and supplements to such prospectus, and in each case including any document incorporated
by reference therein.

     “Purchase Agreement” shall have the meaning set forth in the preamble.

     “Registrable Securities” shall mean the Securities; provided that the Securities shall cease
to be Registrable Securities (i) when a Registration Statement with respect to such Securities has
been declared effective under the Securities Act and such Securities have been exchanged or
disposed of pursuant to such Registration Statement, (ii) when such Securities are eligible to be
sold pursuant to Rule 144(k) (or any similar provision then in force, but not Rule 144A) under the
Securities Act or (iii) when such Securities cease to be outstanding.

     “Registration Expenses” shall mean any and all expenses incident to performance of or
compliance by the Company and the Guarantors with this Agreement, including without limitation: (i)
all SEC, stock exchange or National Association of Securities Dealers, Inc. registration and filing
fees, (ii) all fees and expenses incurred in connection with compliance with state securities or
blue sky laws (including reasonable fees and disbursements of counsel for any Underwriters or
Holders in connection with blue sky qualification of any Exchange Securities or Registrable
Securities), (iii) all expenses of any Persons in preparing or assisting in preparing, word
processing, printing and distributing any Registration Statement, any Prospectus and any amendments
or

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supplements thereto, any underwriting agreements, securities sales agreements or other similar
agreements and any other documents relating to the performance of and compliance with this
Agreement, (iv) all rating agency fees, (v) all fees and disbursements relating to the
qualification of the Indenture under applicable securities laws, (vi) the fees and disbursements of
the Trustee and its counsel, (vii) the fees and disbursements of counsel for the Company and the
Guarantors and, in the case of a Shelf Registration Statement, the reasonable fees and
disbursements of one counsel for the Holders (which counsel shall be selected by the Majority
Holders and which counsel may also be counsel for the Initial Purchasers) and (viii) the fees and
disbursements of the independent public accountants of the Company and the Guarantors, including
the expenses of any special audits or “comfort” letters required by or incident to the performance
of and compliance with this Agreement, but excluding fees and expenses of counsel to the
Underwriters (other than fees and expenses set forth in clause (ii) above) or the Holders and
underwriting discounts and commissions, brokerage commissions and transfer taxes, if any, relating
to the sale or disposition of Registrable Securities by a Holder.

     “Registration Statement” shall mean any registration statement of the Company and the
Guarantors that covers any of the Exchange Securities or Registrable Securities pursuant to the
provisions of this Agreement and all amendments and supplements to any such registration statement,
including post-effective amendments, in each case including the Prospectus contained therein, all
exhibits thereto and any document incorporated by reference therein.

     “SEC” shall mean the United States Securities and Exchange Commission.

     “Securities Act” shall mean the Securities Act of 1933, as amended from time to time.

     “Shelf Additional Interest Date” shall have the meaning set forth in Section 2(d) hereof.

     “Shelf Effectiveness Period” shall have the meaning set forth in Section 2(b) hereof.

     “Shelf Registration” shall mean a registration effected pursuant to Section 2(b) hereof.

     “Shelf Registration Statement” shall mean a “shelf” registration statement of the Company and
the Guarantors that covers all or a portion of the Registrable Securities (but no other securities
unless approved by the Holders whose Registrable Securities are to be covered by such Shelf
Registration Statement) on an appropriate form under Rule 415 under the Securities Act, or any
similar rule that may be adopted by the SEC, and all amendments and supplements to such
registration statement, including post-effective amendments, in each case including the Prospectus
contained therein, all exhibits thereto and any document incorporated by reference therein.

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     “Shelf Request” shall have the meaning set forth in Section 2(b) hereof.

     “Staff” shall mean the staff of the SEC.

     “Target Registration Date” shall have the meaning set forth in Section 2(d) hereof.

     “Trust Indenture Act” shall mean the Trust Indenture Act of 1939, as amended from time to
time.

     “Trustee” shall mean the trustee with respect to the Securities under the Indenture.

     “Underwriter” shall have the meaning set forth in Section 3(e) hereof.

     “Underwritten Offering” shall mean an offering in which Registrable Securities are sold to an
Underwriter for reoffering to the public.

     2. Registration Under the Securities Act. (a) To the extent not prohibited by any
applicable law or applicable interpretations of the Staff, the Company and the Guarantors shall use
their reasonable best efforts to cause to be filed an Exchange Offer Registration Statement
covering an offer to the Holders to exchange all the Registrable Securities for Exchange Securities
and have such Exchange Offer Registration Statement remain effective until the earlier of (i)180
days after the closing of the Exchange Offer or (ii) a date when all Registrable Securities covered
by the Exchange Offer Registration Statement have been sold pursuant thereto. The Company and the
Guarantors shall commence the Exchange Offer promptly after the Exchange Offer Registration
Statement is declared effective by the SEC and use their reasonable best efforts to complete the
Exchange Offer within 360 days after issuance of the Securities. The Company and the Guarantors
will use their reasonable best efforts to complete the Exchange Offer not later than 30 Business
Days after the effective date of the Exchange Offer Registration Statement.

     The Company and the Guarantors shall commence the Exchange Offer by mailing the related
Prospectus, appropriate letters of transmittal and other accompanying documents to each Holder
stating, in addition to such other disclosures as are required by applicable law, substantially the
following:

	(i)  	that the Exchange Offer is being made pursuant to this Agreement and that all Registrable
Securities validly tendered and not properly withdrawn will be accepted for exchange;
	 
	(ii)  	the dates of acceptance for exchange (which shall be a period of at least 20 Business Days
from the date such notice is mailed) (the “Exchange Dates”);

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	(iii)  	that any Registrable Security not tendered will remain outstanding and continue to accrue
interest but will not retain any rights under this Agreement;
	 
	(iv)  	that any Holder electing to have a Registrable Security exchanged pursuant to the Exchange
Offer will be required to surrender such Registrable Security, together with the appropriate
letters of transmittal, to the institution and at the address and in the manner specified in
the notice, prior to the close of business on the last Exchange Date; and
	 
	(v)  	that any Holder will be entitled to withdraw its election, not later than the close of
business on the last Exchange Date, by sending to the institution and at the address specified
in the notice, a telegram, telex, facsimile transmission or letter setting forth the name of
such Holder, the principal amount of Registrable Securities delivered for exchange and a
statement that such Holder is withdrawing its election to have such Securities exchanged.

     As a condition to participating in the Exchange Offer, a Holder will be required to represent
to the Company and the Guarantors that (i) any Exchange Securities to be received by it will be
acquired in the ordinary course of its business, (ii) at the time of the commencement of the
Exchange Offer it has no arrangement or understanding with any Person to participate in the
distribution (within the meaning of the Securities Act) of the Exchange Securities in violation of
the provisions of the Securities Act, (iii) it is not an “affiliate” (within the meaning of Rule
405 under the Securities Act) of the Company or any Guarantor and (iv) if such Holder is a
broker-dealer that will receive Exchange Securities for its own account in exchange for Registrable
Securities that were acquired as a result of market-making or other trading activities, then such
Holder will deliver a Prospectus in connection with any resale of such Exchange Securities.

     As soon as practicable after the last Exchange Date, the Company and the Guarantors shall:

	(i)  	accept for exchange Registrable Securities or portions thereof validly tendered and not
properly withdrawn pursuant to the Exchange Offer; and
	 
	(ii)  	deliver, or cause to be delivered, to the Trustee for cancellation all Registrable Securities
or portions thereof so accepted for exchange by the Company and issue, and cause the Trustee
to promptly authenticate and deliver to each Holder, Exchange Securities equal in principal
amount to the principal amount of the Registrable Securities surrendered by such Holder.

     The Company and the Guarantors shall use their reasonable best efforts to complete the
Exchange Offer as provided above and shall comply with the applicable requirements of the
Securities Act, the Exchange Act and other applicable laws and regulations in connection with the
Exchange Offer. The Exchange Offer shall not be subject to any conditions, other than that the
Exchange Offer does not violate any applicable law or applicable interpretations of the Staff.

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     (b) In the event that (i) the Company and the Guarantors determine that the Exchange Offer
Registration provided for in Section 2(a) above is not available or may not be completed as soon as
practicable after the last Exchange Date because it would violate any applicable law or applicable
interpretations of the Staff, (ii) the Exchange Offer is not for any other reason completed by
August 15, 2005 or (iii) upon receipt of a written request (a “Shelf Request”) from any Initial
Purchaser after the date of the commencement of the Exchange Offer representing that it holds
Registrable Securities that are ineligible to be exchanged in the Exchange Offer, the Company and
the Guarantors shall use their reasonable best efforts to cause to be filed as soon as practicable
after such determination, date or Shelf Request, as the case may be, a Shelf Registration Statement
providing for the sale of all the Registrable Securities by the Holders thereof and to have such
Shelf Registration Statement declared effective by the SEC.

     In the event that the Company and the Guarantors are required to file a Shelf Registration
Statement pursuant to clause (iii) of the preceding sentence, the Company and the Guarantors shall
use their reasonable best efforts to file and have declared effective by the SEC both an Exchange
Offer Registration Statement pursuant to Section 2(a) with respect to all Registrable Securities
and a Shelf Registration Statement (which may be a combined Registration Statement with the
Exchange Offer Registration Statement) with respect to offers and sales of Registrable Securities
held by the Initial Purchasers after completion of the Exchange Offer.

     The Company and the Guarantors agree to use their reasonable best efforts to keep the Shelf
Registration Statement continuously effective until the expiration of the period referred to in
Rule 144(k) (or any similar rule then in force, but not Rule 144A) under the Securities Act with
respect to the Registrable Securities or such shorter period that will terminate when all the
Registrable Securities covered by the Shelf Registration Statement have been sold pursuant to the
Shelf Registration Statement (the “Shelf Effectiveness Period”). The Company and the Guarantors
further agree to supplement or amend the Shelf Registration Statement and the related Prospectus if
required by the rules, regulations or instructions applicable to the registration form used by the
Company for such Shelf Registration Statement or by the Securities Act or by any other rules and
regulations thereunder for shelf registration or if reasonably requested by a Holder of Registrable
Securities with respect to information relating to such Holder, and to use their reasonable best
efforts to cause any such amendment to become effective and such Shelf Registration Statement and
Prospectus to become usable as soon as thereafter practicable. The Company and the Guarantors
agree to furnish to the Holders of Registrable Securities copies of any such supplement or
amendment promptly after its being used or filed with the SEC.

     (c) The Company and the Guarantors shall pay all Registration Expenses in connection with any
registration pursuant to Section 2(a) or Section 2(b) hereof. Each Holder shall pay all
underwriting discounts and commissions, brokerage commissions

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and transfer taxes, if any, relating to the sale or disposition of such Holder’s Registrable
Securities pursuant to the Shelf Registration Statement.

     (d) An Exchange Offer Registration Statement pursuant to Section 2(a) hereof or a Shelf
Registration Statement pursuant to Section 2(b) hereof will not be deemed to have become effective
unless it has been declared effective by the SEC.

     In the event that either the Exchange Offer is not completed or the Shelf Registration
Statement, if required pursuant to Section 2(b)(i) or 2(b)(ii) hereof, is not declared effective on
or prior to August 15, 2005 (the “Target Registration Date”), the annual interest rate on the
Registrable Securities will be increased by 1.0% and shall remain at that increased rate until the
Exchange Offer is completed or the Shelf Registration Statement, if required hereby, is declared
effective by the SEC or the Securities become freely tradable under the Securities Act. In the
event the Company receives a Shelf Request pursuant to Section 2(b)(iii), and the Shelf
Registration Statement required to be filed thereby is not declared effective by the later of (x)
August 15, 2005 or (y) 90 days after the delivery of such Shelf Request (such later date, the
“Shelf Additional Interest Date”), then the annual interest rate on the Registrable Securities will
be increased by 1.0% payable commencing from one day after the Shelf Additional Interest Date and
shall remain at that increased rate until the Shelf Registration Statement is declared effective.

     If the Shelf Registration Statement, if required hereby, has been declared effective and
thereafter either ceases to be effective or the Prospectus contained therein ceases to be usable at
any time during the Shelf Effectiveness Period, and such failure to remain effective or usable
exists for more than 45 days (whether or not consecutive) in any 12-month period, then the annual
interest rate on the Registrable Securities will be increased by 1.0% per annum commencing on the
46th day in such 12-month period and ending on such date that the Shelf Registration Statement has
again been declared effective or the Prospectus again becomes usable.

     (e) Without limiting the remedies available to the Initial Purchasers and the Holders, the
Company and the Guarantors acknowledge that any failure by the Company or the Guarantors to comply
with their obligations under Section 2(a) and Section 2(b) hereof may result in material
irreparable injury to the Initial Purchasers or the Holders for which there is no adequate remedy
at law, that it will not be possible to measure damages for such injuries precisely and that, in
the event of any such failure, the Initial Purchasers or any Holder may obtain such relief as may
be required to specifically enforce the Company’s and the Guarantors’ obligations under Section
2(a) and Section 2(b) hereof.

     3. Registration Procedures. (a) In connection with their obligations pursuant to
Section 2(a) and Section 2(b) hereof, the Company and the Guarantors shall as expeditiously as
possible:

     (i) prepare and file with the SEC a Registration Statement on the appropriate form under the
Securities Act, which form (x) shall be selected by the Company and the

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Guarantors, (y) shall, in the case of a Shelf Registration, be available for the sale of the
Registrable Securities by the Holders thereof and (z) shall comply as to form in all material
respects with the requirements of the applicable form and include all financial statements required
by the SEC to be filed therewith; and use their reasonable best efforts to cause such Registration
Statement to become effective and remain effective for the applicable period in accordance with
Section 2 hereof;

     (ii) prepare and file with the SEC such amendments and post-effective amendments to each
Registration Statement as may be necessary to keep such Registration Statement effective for the
applicable period in accordance with Section 2 hereof and cause each Prospectus to be supplemented
by any required prospectus supplement and, as so supplemented, to be filed pursuant to Rule 424
under the Securities Act; and keep each Prospectus current during the period described in Section
4(3) of and Rule 174 under the Securities Act that is applicable to transactions by brokers or
dealers with respect to the Registrable Securities or Exchange Securities;

     (iii) in the case of a Shelf Registration, furnish to each Holder of Registrable Securities,
to counsel for the Initial Purchasers, to counsel for such Holders and to each Underwriter of an
Underwritten Offering of Registrable Securities, if any, without charge, as many copies of each
Prospectus, including each preliminary Prospectus, and any amendment or supplement thereto, as such
Holder, counsel or Underwriter may reasonably request, in order to facilitate the sale or other
disposition of the Registrable Securities thereunder; and the Company and the Guarantors consent to
the use of such Prospectus and any amendment or supplement thereto in accordance with applicable
law by each of the Holders of Registrable Securities and any such Underwriters in connection with
the offering and sale of the Registrable Securities covered by and in the manner described in such
Prospectus or any amendment or supplement thereto in accordance with applicable law;

     (iv) use their reasonable best efforts to register or qualify the Registrable Securities under
all applicable state securities or blue sky laws of such jurisdictions as any Holder of Registrable
Securities covered by a Registration Statement shall reasonably request in writing by the time the
applicable Registration Statement is declared effective by the SEC; cooperate with such Holders in
connection with any filings required to be made with the National Association of Securities
Dealers, Inc.; and do any and all other acts and things that may be reasonably necessary or
advisable to enable each Holder to complete the disposition in each such jurisdiction of the
Registrable Securities owned by such Holder; provided that neither the Company nor any
Guarantor shall be required to (1) qualify as a foreign corporation or other entity or as a dealer
in securities in any such jurisdiction where it would not otherwise be required to so qualify, (2)
take any action that would subject it to service of process in any such jurisdiction or (3) subject
itself to taxation in any such jurisdiction if it is not so subject;

     (v) notify counsel for the Initial Purchasers and, in the case of a Shelf Registration, notify
each Holder of Registrable Securities and counsel for such Holders promptly and, if requested by
any such Holder or counsel, confirm such advice in writing

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(1) when a Registration Statement has become effective and when any post-effective amendment
thereto has been filed and becomes effective, (2) of any request by the SEC or any state securities
authority for amendments and supplements to a Registration Statement and Prospectus or for
additional information after the Registration Statement has become effective, (3) of the issuance
by the SEC or any state securities authority of any stop order suspending the effectiveness of a
Registration Statement or the initiation of any proceedings for that purpose, (4) if, between the
effective date of a Shelf Registration Statement and the closing of any sale of Registrable
Securities covered thereby, the representations and warranties of the Company or any Guarantor
contained in any underwriting agreement, securities sales agreement or other similar agreement, if
any, relating to an offering of such Registrable Securities cease to be true and correct in all
material respects or if the Company or any Guarantor receives any notification with respect to the
suspension of the qualification of the Registrable Securities for sale in any jurisdiction or the
initiation of any proceeding for such purpose, (5) of the happening of any event during the period
a Shelf Registration Statement is effective that makes any statement made in such Shelf
Registration Statement or the related Prospectus untrue in any material respect or that requires
the making of any changes in such Shelf Registration Statement or Prospectus in order to make the
statements therein not misleading and (6) of any determination by the Company or any Guarantor that
a post-effective amendment to a Registration Statement would be appropriate;

     (vi) use their reasonable best efforts to obtain the withdrawal of any order suspending the
effectiveness of a Registration Statement at the earliest possible moment and provide immediate
notice to each Holder of the withdrawal of any such order;

     (vii) in the case of a Shelf Registration, furnish to each Holder of Registrable Securities,
without charge, at least one conformed copy of each Shelf Registration Statement and any
post-effective amendment thereto (without any documents incorporated therein by reference or
exhibits thereto, unless requested in writing by any such Holder);

     (viii) in the case of a Shelf Registration, cooperate with the Holders of Registrable
Securities to facilitate the timely preparation and delivery of certificates representing
Registrable Securities to be sold and not bearing any restrictive legends and enable such
Registrable Securities to be issued in such denominations and registered in such names (consistent
with the provisions of the Indenture) as such Holders may reasonably request at least one Business
Day prior to the closing of any sale of Registrable Securities;

     (ix) in the case of a Shelf Registration, upon the occurrence of any event contemplated by
Section 3(a)(v)(5) hereof, use their reasonable best efforts to prepare and file with the SEC a
supplement or post-effective amendment to such Shelf Registration Statement or the related
Prospectus or any document incorporated therein by reference or file any other required document so
that, as thereafter delivered to purchasers of the Registrable Securities, such Prospectus will not
contain any untrue statement of a material fact or omit to state a material fact necessary to make
the statements therein, in

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the light of the circumstances under which they were made, not misleading; and the Company and
the Guarantors shall notify the Holders of Registrable Securities to suspend use of the Prospectus
as promptly as practicable after the occurrence of such an event, and such Holders hereby agree to
suspend use of the Prospectus until the Company and the Guarantors have amended or supplemented the
Prospectus to correct such misstatement or omission or until the Company and the Guarantors notify
the Holders that the Prospectus may once again be used;

     (x) a reasonable time prior to the filing of any Shelf Registration Statement, any related
Prospectus, any amendment to a Shelf Registration Statement or amendment or supplement to a related
Prospectus or of any document that is to be incorporated by reference into a Shelf Registration
Statement or a Prospectus after the initial filing of a Shelf Registration Statement, provide
copies of such document to the Holders of Registrable Securities and their counsel and make such of
the representatives of the Company and the Guarantors as shall be reasonably requested by the
Holders of Registrable Securities or their counsel available for discussion of such document; and
the Company and the Guarantors shall not, at any time after initial filing of a Shelf Registration
Statement, file any Prospectus, any amendment of or supplement to a Shelf Registration Statement or
a Prospectus, or any document that is to be incorporated by reference into a Shelf Registration
Statement or a Prospectus, of which the Holders of Registrable Securities and their counsel shall
not have previously been advised and furnished a copy or to which the Holders of Registrable
Securities or their counsel shall reasonably object;

     (xi) obtain a CUSIP number for all Exchange Securities or Registrable Securities, as the case
may be, not later than the effective date of a Registration Statement;

     (xii) cause the Indenture to be qualified under the Trust Indenture Act in connection with the
registration of the Exchange Securities or Registrable Securities, as the case may be; cooperate
with the Trustee and the Holders to effect such changes to the Indenture as may be required for the
Indenture to be so qualified in accordance with the terms of the Trust Indenture Act; and execute,
and use their reasonable best efforts to cause the Trustee to execute, all documents as may be
required to effect such changes and all other forms and documents required to be filed with the SEC
to enable the Indenture to be so qualified in a timely manner;

     (xiii) in the case of a Shelf Registration, make available for inspection by a representative
of the Holders of the Registrable Securities (an “Inspector”), any Underwriter participating in any
disposition pursuant to such Shelf Registration Statement, any attorneys and accountants designated
by the Holders of Registrable Securities and any attorneys and accountants designated by such
Underwriter, at reasonable times and in a reasonable manner, all pertinent financial and other
records, documents and properties of the Company and the Guarantors, and cause the respective
officers, directors and employees of the Company and the Guarantors to supply all information
reasonably requested by any such Inspector, Underwriter, attorney or

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accountant in connection with a Shelf Registration Statement; provided that if any
such information is identified by the Company or any Guarantor as being confidential or
proprietary, each Person receiving such information shall take such actions as are reasonably
necessary to protect the confidentiality of such information to the extent such action is otherwise
not inconsistent with, an impairment of or in derogation of the rights and interests of any
Inspector, Holder or Underwriter;

     (xiv) in the case of a Shelf Registration, use their reasonable best efforts to cause all
Registrable Securities to be listed on any securities exchange or any automated quotation system on
which the 81/4% Senior Subordinated Notes due 2014 are then listed if requested by the Majority
Holders, to the extent such Registrable Securities satisfy applicable listing requirements;

     (xv) if reasonably requested by any Holder of Registrable Securities covered by a Shelf
Registration Statement, promptly include in a Prospectus supplement or post-effective amendment
such information with respect to such Holder as such Holder reasonably requests to be included
therein and make all required filings of such Prospectus supplement or such post-effective
amendment as soon as the Company has received notification of the matters to be so included in such
filing; and

     (xvi) in the case of a Shelf Registration, enter into such customary agreements and take all
such other actions in connection therewith (including those requested by the Holders of a majority
in principal amount of the Registrable Securities being sold) in order to expedite or facilitate
the disposition of such Registrable Securities including, but not limited to, an Underwritten
Offering and in such connection, (1) to the extent possible, make such representations and
warranties to the Holders and any Underwriters of such Registrable Securities with respect to the
business of the Company and its subsidiaries and the Registration Statement, Prospectus and
documents incorporated by reference or deemed incorporated by reference, if any, in each case, in
form, substance and scope as are customarily made by issuers to underwriters in underwritten
offerings and confirm the same if and when requested, (2) obtain opinions of counsel to the Company
and the Guarantors (which counsel and opinions, in form, scope and substance, shall be reasonably
satisfactory to the Holders and such Underwriters and their respective counsel) addressed to each
selling Holder and Underwriter of Registrable Securities, covering the matters customarily covered
in opinions requested in underwritten offerings, (3) obtain “comfort” letters from the independent
certified public accountants of the Company and the Guarantors (and, if necessary, any other
certified public accountants of any subsidiary of the Company or any Guarantor, or of any business
acquired by the Company or any Guarantor for which financial statements and financial data are or
are required to be included in the Registration Statement) addressed to each selling Holder and
Underwriter of Registrable Securities, such letters to be in customary form and covering matters of
the type customarily covered in “comfort” letters in connection with underwritten offerings and (4)
deliver such documents and certificates as may be reasonably requested by the Holders of a majority
in principal amount of the Registrable Securities being sold or the Underwriters, and which are
customarily delivered in underwritten offerings, to evidence the continued validity of the
representations and

12

 

warranties of the Company and the Guarantors made pursuant to clause (1) above and to evidence
compliance with any customary conditions contained in an underwriting agreement.

     (b) In the case of a Shelf Registration Statement, the Company may require each Holder of
Registrable Securities to furnish to the Company such information regarding such Holder and the
proposed disposition by such Holder of such Registrable Securities as the Company and the
Guarantors may from time to time reasonably request in writing.

     (c) In the case of a Shelf Registration Statement, each Holder of Registrable Securities
agrees that, upon receipt of any notice from the Company and the Guarantors of the happening of any
event of the kind described in Section 3(a)(v)(3) or 3(a)(v)(5) hereof, such Holder will forthwith
discontinue disposition of Registrable Securities pursuant to the Shelf Registration Statement
until such Holder’s receipt of the copies of the supplemented or amended Prospectus contemplated by
Section 3(a)(ix) hereof and, if so directed by the Company and the Guarantors, such Holder will
deliver to the Company and the Guarantors all copies in its possession, other than permanent file
copies then in such Holder’s possession, of the Prospectus covering such Registrable Securities
that is current at the time of receipt of such notice.

     (d) If the Company and the Guarantors shall give any notice pursuant to Section 3(c) hereof to
suspend the disposition of Registrable Securities pursuant to a Shelf Registration Statement, the
Company and the Guarantors shall extend the period during which such Shelf Registration Statement
shall be maintained effective pursuant to this Agreement by the number of days during the period
from and including the date of the giving of such notice to and including the date when the Holders
of such Registrable Securities shall have received copies of the supplemented or amended Prospectus
necessary to resume such dispositions. The Company and the Guarantors may give any such notice only
twice during any 365-day period and any such suspensions shall not exceed 45 days for each
suspension.

     (e) The Holders of Registrable Securities covered by a Shelf Registration Statement who desire
to do so may sell such Registrable Securities in an Underwritten Offering. In any such
Underwritten Offering, the investment bank or investment banks and manager or managers (each an
“Underwriter”) that will administer the offering will be selected by the Holders of a majority in
principal amount of the Registrable Securities included in such offering.

     4. Participation of Broker-Dealers in Exchange Offer. (a) The Staff has taken the
position that any broker-dealer that receives Exchange Securities for its own account in the
Exchange Offer in exchange for Securities that were acquired by such broker-dealer as a result of
market-making or other trading activities (a “Participating Broker-Dealer”) may be deemed to be an
“underwriter” within the meaning of the Securities Act and must deliver a prospectus meeting the
requirements of the Securities Act in connection with any resale of such Exchange Securities.

13

 

     The Company and the Guarantors understand that it is the Staff’s position that if the
Prospectus contained in the Exchange Offer Registration Statement includes a plan of distribution
containing a statement to the above effect and the means by which Participating Broker-Dealers may
resell the Exchange Securities, without naming the Participating Broker-Dealers or specifying the
amount of Exchange Securities owned by them, such Prospectus may be delivered by Participating
Broker-Dealers to satisfy their prospectus delivery obligation under the Securities Act in
connection with resales of Exchange Securities for their own accounts, so long as the Prospectus
otherwise meets the requirements of the Securities Act.

     (b) In light of the above, and notwithstanding the other provisions of this Agreement, the
Company and the Guarantors agree to amend or supplement the Prospectus contained in the Exchange
Offer Registration Statement for a period of up to 180 days after the last Exchange Date (as such
period may be extended pursuant to Section 3(d) of this Agreement), if requested by the Initial
Purchasers or by one or more Participating Broker-Dealers, in order to expedite or facilitate the
disposition of any Exchange Securities by Participating Broker-Dealers consistent with the
positions of the Staff recited in Section 4(a) above. The Company and the Guarantors further agree
that Participating Broker-Dealers shall be authorized to deliver such Prospectus during such period
in connection with the resales contemplated by this Section 4.

     (c) The Initial Purchasers shall have no liability to the Company, any Guarantor or any Holder
with respect to any request that they may make pursuant to Section 4(b) above.

     5. Indemnification and Contribution. (a) The Company and each Guarantor, jointly and
severally, agree to indemnify and hold harmless each Initial Purchaser and each Holder, their
respective affiliates, directors and officers and each Person, if any, who controls any Initial
Purchaser or any Holder within the meaning of Section 15 of the Securities Act or Section 20 of the
Exchange Act, from and against any and all losses, claims, damages and liabilities (including,
without limitation, legal fees and other expenses incurred in connection with any suit, action or
proceeding or any claim asserted, as such fees and expenses are incurred), that arise out of, or
are based upon, any untrue statement or alleged untrue statement of a material fact contained in
any Registration Statement or any Prospectus or any omission or alleged omission to state therein a
material fact required to be stated therein or necessary in order to make the statements therein,
in the light of the circumstances under which they were made, not misleading, except insofar as
such losses, claims, damages or liabilities arise out of, or are based upon, any untrue statement
or omission or alleged untrue statement or omission made in reliance upon and in conformity with
any information relating to any Initial Purchaser or information relating to any Holder furnished
to the Company in writing through JPMorgan or any selling Holder expressly for use therein. In
connection with any Underwritten Offering permitted by Section 3, the Company and the Guarantors,
jointly and severally, will also indemnify the Underwriters, if any, selling brokers, dealers and
similar securities industry professionals participating in the distribution, their respective

14

 

affiliates and each Person who controls such Persons (within the meaning of the Securities Act
and the Exchange Act) to the same extent as provided above with respect to the indemnification of
the Holders, if requested in connection with any Registration Statement.

     (b) Each Holder agrees, severally and not jointly, to indemnify and hold harmless the Company,
the Guarantors, the Initial Purchasers and the other selling Holders, the directors of the Company
and the Guarantors, each officer of the Company and the Guarantors who signed the Registration
Statement and each Person, if any, who controls the Company, the Guarantors, any Initial Purchaser
and any other selling Holder within the meaning of Section 15 of the Securities Act or Section 20
of the Exchange Act to the same extent as the indemnity set forth in paragraph (a) above, but only
with respect to any losses, claims, damages or liabilities that arise out of, or are based upon,
any untrue statement or omission or alleged untrue statement or omission made in reliance upon and
in conformity with any information relating to such Holder furnished to the Company in writing by
such Holder expressly for use in any Registration Statement and any Prospectus.

     (c) If any suit, action, proceeding (including any governmental or regulatory investigation),
claim or demand shall be brought or asserted against any Person in respect of which indemnification
may be sought pursuant to either paragraph (a) or (b) above, such Person (the “Indemnified Person”)
shall promptly notify the Person against whom such indemnification may be sought (the “Indemnifying
Person”) in writing; provided that the failure to notify the Indemnifying Person shall not
relieve it from any liability that it may have under this Section 5 except to the extent that it
has been materially prejudiced (through the forfeiture of substantive rights or defenses) by such
failure; and provided, further, that the failure to notify the Indemnifying Person
shall not relieve it from any liability that it may have to an Indemnified Person otherwise than
under this Section 5. If any such proceeding shall be brought or asserted against an Indemnified
Person and it shall have notified the Indemnifying Person thereof, the Indemnifying Person shall be
entitled to participate therein and, to the extent that it wishes, jointly with any other similarly
notified Indemnified Person, to assume the defense thereof with counsel reasonably satisfactory to
the Indemnified Person. After notice to the Indemnifying Person to the Indemnified Person of its
election to assume the defense of such claim or action, the Indemnifying Person will not be liable
to the Indemnified Person under this Section 5 for any legal or other expenses subsequently
incurred by the Indemnified Person in connection with the defense thereof other than reasonable
costs of investigation; provided however, such counsel shall be at the expense of such Indemnified
Person unless (i) the Indemnifying Person and the Indemnified Person shall have mutually agreed to
the contrary; (ii) the Indemnifying Person has failed within a reasonable time to retain counsel
reasonably satisfactory to the Indemnified Person; (iii) the Indemnified Person shall have
reasonably concluded that there may be legal defenses available to it that are different from or in
addition to those available to the Indemnifying Person; or (iv) the named parties in any such
proceeding (including any impleaded parties) include both the Indemnifying Person and the
Indemnified Person and representation of both parties by the same counsel would be inappropriate
due to actual or

15

 

potential differing interests between them. It is understood and agreed that the Indemnifying
Person shall not, in connection with any proceeding or related proceeding in the same jurisdiction,
be liable for the fees and expenses of more than one separate firm (in addition to any local
counsel) for all Indemnified Persons, and that all such fees and expenses shall be reimbursed as
they are incurred. Any such separate firm (x) for any Initial Purchaser, its affiliates, directors
and officers and any control Persons of such Initial Purchaser shall be designated in writing by
JPMorgan, (y) for any Holder, its directors and officers and any control Persons of such Holder
shall be designated in writing by the Majority Holders and (z) in all other cases shall be
designated in writing by the Company. The Indemnifying Person shall not be liable for any
settlement of any proceeding effected without its written consent, but if settled with such consent
or if there be a final judgment for the plaintiff, the Indemnifying Person agrees to indemnify each
Indemnified Person from and against any loss or liability by reason of such settlement or judgment.
No Indemnifying Person shall, without the written consent of the Indemnified Person, effect any
settlement of any pending or threatened proceeding in respect of which any Indemnified Person is or
could have been a party and indemnification could have been sought hereunder by such Indemnified
Person, unless such settlement (A) includes an unconditional release of such Indemnified Person, in
form and substance reasonably satisfactory to such Indemnified Person, from all liability on claims
that are the subject matter of such proceeding and (B) does not include any statement as to or any
admission of fault, culpability or a failure to act by or on behalf of any Indemnified Person.

     (d) If the indemnification provided for in paragraphs (a) and (b) above is unavailable to an
Indemnified Person or insufficient in respect of any losses, claims, damages or liabilities
referred to therein, then each Indemnifying Person under such paragraph, in lieu of indemnifying
such Indemnified Person thereunder, shall contribute to the amount paid or payable by such
Indemnified Person as a result of such losses, claims, damages or liabilities (i) in such
proportion as is appropriate to reflect the relative benefits received by the Company and the
Guarantors from the offering of the Securities and the Exchange Securities, on the one hand, and by
the Holders from receiving Securities or Exchange Securities registered under the Securities Act,
on the other hand, or (ii) if the allocation provided by clause (i) is not permitted by applicable
law, in such proportion as is appropriate to reflect not only the relative benefits referred to in
clause (i) but also the relative fault of the Company and the Guarantors on the one hand and the
Holders on the other in connection with the statements or omissions that resulted in such losses,
claims, damages or liabilities, as well as any other relevant equitable considerations. The
relative fault of the Company and the Guarantors on the one hand and the Holders on the other shall
be determined by reference to, among other things, whether the untrue or alleged untrue statement
of a material fact or the omission or alleged omission to state a material fact relates to
information supplied by the Company and the Guarantors or by the Holders and the parties’ relative
intent, knowledge, access to information and opportunity to correct or prevent such statement or
omission.

     (e) The Company, the Guarantors and the Holders agree that it would not be just and equitable
if contribution pursuant to this Section 5 were determined by pro rata allocation
(even if the Holders were treated as one entity for such purpose) or by any

16

 

other method of allocation that does not take account of the equitable considerations referred to
in paragraph (d) above. The amount paid or payable by an Indemnified Person as a result of the
losses, claims, damages and liabilities referred to in paragraph (d) above shall be deemed to
include, subject to the limitations set forth above, any legal or other expenses incurred by such
Indemnified Person in connection with any such action or claim. Notwithstanding the provisions of
this Section 5, in no event shall a Holder be required to contribute any amount in excess of the
amount by which the total price at which the Securities or Exchange Securities sold by such Holder
exceeds the amount of any damages that such Holder has otherwise been required to pay by reason of
such untrue or alleged untrue statement or omission or alleged omission. No Person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be
entitled to contribution from any Person who was not guilty of such fraudulent misrepresentation.

     (f) The remedies provided for in this Section 5 are not exclusive and shall not limit any
rights or remedies that may otherwise be available to any Indemnified Person at law or in equity.

     (g) The indemnity and contribution provisions contained in this Section 5 shall remain
operative and in full force and effect regardless of (i) any termination of this Agreement, (ii)
any investigation made by or on behalf of the Initial Purchasers or any Holder or any Person
controlling any Initial Purchaser or any Holder, or by or on behalf of the Company or the
Guarantors or the officers or directors of or any Person controlling the Company or the Guarantors,
(iii) acceptance of any of the Exchange Securities and (iv) any sale of Registrable Securities
pursuant to a Shelf Registration Statement.

     6. General.

     (a) No Inconsistent Agreements. The Company and the Guarantors represent, warrant and agree
that (i) the rights granted to the Holders hereunder do not in any way conflict with and are not
inconsistent with the rights granted to the holders of any other outstanding securities issued or
guaranteed by the Company or any Guarantor under any other agreement and (ii) neither the Company
nor any Guarantor has entered into, or on or after the date of this Agreement will enter into, any
agreement that is inconsistent with the rights granted to the Holders of Registrable Securities in
this Agreement or otherwise conflicts with the provisions hereof.

     (b) Amendments and Waivers. The provisions of this Agreement, including the provisions of
this sentence, may not be amended, modified or supplemented, and waivers or consents to departures
from the provisions hereof may not be given unless the Company and the Guarantors have obtained the
written consent of Holders of at least a majority in aggregate principal amount of the outstanding
Registrable Securities affected by such amendment, modification, supplement, waiver or consent;
provided that no amendment, modification, supplement, waiver or consent to any departure
from the provisions of Section 5 hereof shall be effective as against any Holder of Registrable
Securities unless consented to in writing by such Holder. Any amendments,

17

 

modifications, supplements, waivers or consents pursuant to this Section 6(b) shall be by a
writing executed by each of the parties hereto.

     (c) Notices. All notices and other communications provided for or permitted hereunder shall
be made in writing by hand-delivery, registered first-class mail, telex, telecopier, or any courier
guaranteeing overnight delivery (i) if to a Holder, at the most current address given by such
Holder to the Company by means of a notice given in accordance with the provisions of this Section
6(c), which address initially is, with respect to the Initial Purchasers, the address set forth in
the Purchase Agreement, with copies to Arthur D. Robinson, Esq., Simpson Thacher & Bartlett LLP,
425 Lexington Avenue, New York, New York 10017, Telecopy No.: (212) 455-2502, Confirm No.: (212)
455-2500; (ii) if to the Company and the Guarantors, initially at the Company’s address set forth
in the Purchase Agreement and thereafter at such other address, notice of which is given in
accordance with the provisions of this Section 6(c) a copy to Ian Blumenstein, Esq. at Riverside
Center, 275 Grove St., 4th Floor, Newton, MA 02466 (fax: (617) 663-5319); and (iii) to such other
persons at their respective addresses as provided in the Purchase Agreement and thereafter at such
other address, notice of which is given in accordance with the provisions of this Section 6(c).
All such notices and communications shall be deemed to have been duly given: at the time delivered
by hand, if personally delivered; five Business Days after being deposited in the mail, postage
prepaid, if mailed; when receipt is acknowledged, if telecopied; and on the next Business Day if
timely delivered to an air courier guaranteeing overnight delivery. Copies of all such notices,
demands or other communications shall be concurrently delivered by the Person giving the same to
the Trustee, at the address specified in the Indenture.

     (d) Successors and Assigns. This Agreement shall inure to the benefit of and be binding upon
the successors, assigns and transferees of each of the parties, including, without limitation and
without the need for an express assignment, subsequent Holders; provided that nothing
herein shall be deemed to permit any assignment, transfer or other disposition of Registrable
Securities in violation of the terms of the Purchase Agreement or the Indenture. If any transferee
of any Holder shall acquire Registrable Securities in any manner, whether by operation of law or
otherwise, such Registrable Securities shall be held subject to all the terms of this Agreement,
and by taking and holding such Registrable Securities such Person shall be conclusively deemed to
have agreed to be bound by and to perform all of the terms and provisions of this Agreement and
such Person shall be entitled to receive the benefits hereof. The Initial Purchasers (in their
capacity as Initial Purchasers) shall have no liability or obligation to the Company or the
Guarantors with respect to any failure by a Holder to comply with, or any breach by any Holder of,
any of the obligations of such Holder under this Agreement.

     (e) Third Party Beneficiaries. Each Holder shall be a third party beneficiary to the
agreements made hereunder between the Company and the Guarantors, on the one hand, and the Initial
Purchasers, on the other hand, and shall have the right to enforce such agreements directly to the
extent it deems such enforcement necessary or advisable to protect its rights or the rights of
other Holders hereunder.

18

 

     (f) Counterparts. This Agreement may be executed in any number of counterparts and by the
parties hereto in separate counterparts, each of which when so executed shall be deemed to be an
original and all of which taken together shall constitute one and the same agreement.

     (g) Headings. The headings in this Agreement are for convenience of reference only, are not a
part of this Agreement and shall not limit or otherwise affect the meaning hereof.

     (h) Governing Law. This Agreement shall be governed by and construed in accordance with the
laws of the State of New York.

     (i) Miscellaneous. This Agreement contains the entire agreement between the parties relating
to the subject matter hereof and supersedes all oral statements and prior writings with respect
thereto. If any term, provision, covenant or restriction contained in this Agreement is held by a
court of competent jurisdiction to be invalid, void or unenforceable or against public policy, the
remainder of the terms, provisions, covenants and restrictions contained herein shall remain in
full force and effect and shall in no way be affected, impaired or invalidated. The Company, the
Guarantors and the Initial Purchasers shall endeavor in good faith negotiations to replace the
invalid, void or unenforceable provisions with valid provisions the economic effect of which
comes as close as possible to that of the invalid, void or unenforceable provisions.

     (j) Joinder of Guarantors. Upon the Acquisition Closing (as defined in the Purchase
Agreement), the Company shall cause any subsidiary of the Company that is required to be a
Guarantor under the Indenture to become a party to this Agreement by executing and delivering a
joinder agreement to this Agreement in the form attached hereto as Exhibit A.

19

 

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

Standard Aero Holdings, Inc.

By:/s/
Bradley Bertouille

Name: Bradley Bertouille

Title: Senior Vice President of Finance,

     Treasurer and Secretary

Confirmed and accepted as of the date first above written:

J.P. MORGAN SECURITIES INC.

For itself and on behalf of the

several Initial Purchasers

By   [illegible]                          

          Authorized Signatory

20

 

Schedule 1

Guarantors

	 	 	 
	Name	 	Jurisdiction of Incorporation
	Dunlop Standard Aerospace (US) Inc.

	 	Delaware
	Dunlop Standard Aerospace (US) Legal Inc.

	 	Delaware
	Standard Aero, Inc.

	 	Delaware
	Dunlop Aerospace Parts, Inc.

	 	Delaware
	Standard Aero (San Antonio) Inc.

	 	Delaware
	Standard Aero (Alliance) Inc.

	 	Delaware
	Standard Aero Canada, Inc.

	 	Delaware
	3091781 Nova Scotia Company

	 	Nova Scotia
	3091782 Nova Scotia Company

	 	Nova Scotia
	3091783 Nova Scotia Company

	 	Nova Scotia
	Standard Aero Limited

	 	Canada
	Not FM Canada Inc.

	 	Canada
	Dunlop Standard Aerospace (Nederland) BV

	 	The Netherlands
	Standard Aero BV

	 	The Netherlands

 

 

Exhibit A

JOINDER TO THE REGISTRATION RIGHTS AGREEMENT

_______ __, 2004

J.P. Morgan Securities Inc.

Lehman Brothers Inc.

Credit Suisse First Boston LLC

c/o J.P. Morgan Securities Inc.

270 Park Avenue

New York, New York 10017

Ladies and Gentlemen:

     Reference is made to the Registration Rights Agreement (the “Registration Rights Agreement”)
dated August 20, 2004, among Standard Aero Holdings, Inc., a Delaware corporation (the “Company”),
J.P. Morgan Securities Inc., Lehman Brothers Inc. and Credit Suisse First Boston LLC (collectively,
the “Initial Purchasers”) concerning the purchase of the Securities (as defined in the Registration
Rights Agreement) from the Company by the several Initial Purchasers. Capitalized terms used
herein but not defined herein shall have the meanings assigned to such terms in the Registration
Rights Agreement.

     The Company and each of the Guarantors party hereto (the “Guarantors”) agree that this letter
agreement is being executed and delivered in connection with the issue and sale of the Securities
pursuant to the Purchase Agreement.

          1. Joinder. Each of the parties hereto hereby agrees to become bound by the terms,
conditions and other provisions of the Registration Rights Agreement with all attendant rights,
duties and obligations stated therein, with the same force and effect as if originally named as a
Guarantor therein and as if such party executed the Registration Rights Agreement on the date
thereof.

           3. GOVERNING LAW. THIS LETTER AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

           4. Counterparts. This letter agreement may be executed in one or more counterparts
(which may include counterparts delivered by telecopier) and, if executed in more than one
counterpart, the executed counterparts shall each be deemed to be an original, but all such
counterparts shall together constitute one and the same instrument.

           5. Amendments. No amendment or waiver of any provision of this letter agreement, nor
any consent or approval to any departure therefrom, shall in any event be effective unless the same
shall be in writing and signed by the parties hereto.

 

 

           6. Headings. The headings herein are inserted for the convenience of
reference only and are not intended to be part of, or to affect the meaning or interpretation of,
this letter agreement.

 

 

     If the foregoing is in accordance with your understanding of our agreement, kindly sign and
return to us a counterpart hereof, whereupon this letter agreement will become a binding agreement
between the Company, the Guarantors party hereto and the several Initial Purchasers in accordance
with its terms.

Very truly yours,

STANDARD AERO HOLDINGS, INC., as Issuer

By:______________________________

Name:

Title:

DUNLOP STANDARD AEROSPACE (US) INC.

By:______________________________

Name:

Title:

DUNLOP STANDARD AEROSPACE (US) LEGAL INC.

By:______________________________

Name:

Title:

STANDARD AERO, INC.

By:______________________________

Name:

Title:

DUNLOP AEROSPACE PARTS, INC.

By:______________________________

Name:

Title:

 

 

STANDARD AERO (SAN ANTONIO) INC.

By:______________________________

Name:

Title:

STANDARD AERO (ALLIANCE) INC.

By:______________________________

Name:

Title:

STANDARD AERO CANADA, INC.

By:______________________________

Name:

Title:

3091781 NOVA SCOTIA COMPANY

By:______________________________

Name:

Title:

3091782 NOVA SCOTIA COMPANY

By:______________________________

Name:

Title:

3091783 NOVA SCOTIA COMPANY

By:______________________________

Name:

Title:

STANDARD AERO LIMITED

By:______________________________

Name:

Title:

NOT FM CANADA INC.

By:______________________________

Name:

Title:

 

 

DUNLOP STANDARD AEROSPACE

(NEDERLAND) BV

By:______________________________

Name:

Title:

STANDARD AERO BV

By:______________________________

Name:

Title:

 

 

Accepted: ___, 2004

J.P. MORGAN SECURITIES INC.

LEHMAN BROTHERS INC.

CREDIT SUISSE FIRST BOSTON LLC

By: J.P. MORGAN SECURITIES INC.

By:

______________________________

Name:

Title:exv4w8

 

Exhibit 4.8

EXECUTION COPY

$200,000,000

STANDARD AERO HOLDINGS, INC.

81/4% Senior Subordinated Notes due 2014

Purchase Agreement

August 17, 2004

J.P. Morgan Securities Inc.

Lehman Brothers Inc.
   As
Representatives of the
   several
Initial Purchasers listed
   in
Schedule 1 hereto

c/o J.P. Morgan Securities Inc.

270 Park Avenue

New York, New York 10017

Ladies and Gentlemen:

     Standard Aero Holdings, Inc., a Delaware corporation (the “Company”), proposes to issue and
sell to the several Initial Purchasers listed in Schedule 1 hereto (the “Initial Purchasers”), for
whom you are acting as representatives (the “Representatives”), $200,000,000 principal amount of
its 81/4% Senior Subordinated Notes due 2014 (the “Securities”). The Securities will be issued
pursuant to an Indenture to be dated as of August 20, 2004 (the “Indenture”) among the Company, (as
later supplemented by a supplemental indenture (the “Supplemental Indenture”) entered into by the
subsidiary guarantors listed in Schedule 3 hereto (the “Guarantors”)) and Wells Fargo Bank,
National Association, as trustee (the “Trustee”), and will be guaranteed on an unsecured senior
subordinated basis by each of the Guarantors (the “Guarantees”).

     Pursuant to a purchase agreement dated as of July 5, 2004 (the “DSAG Purchase Agreement”), by
and between Meggitt plc (“Meggitt”), Doughty Hanson & Co. Limited (the “Seller”), the Company and
others, among other things, (a) Meggitt will purchase the outstanding capital stock of Dunlop
Standard Aerospace Group Limited (“Dunlop”) from the Seller (the “DSAG Acquisition”) and (b)
concurrently with the DSAG Acquisition, Standard Aero Acquisition Holdings, Inc. (“Holdings”), a
newly formed domestic entity controlled by The Carlyle Group (together with its affiliates, the
“Sponsor”), through its wholly owned subsidiary, the Company, will acquire (the “Acquisition”) from
Meggitt, pursuant to a purchase agreement dated as of July 5, 2004 (the “ERO Purchase Agreement”),
the engine repair and overhaul business of Dunlop consisting of all of the issued and outstanding
common stock or other equity interests of Dunlop Standard Aerospace (U.S.) Inc., Standard Aero
Inc., Dunlop Aerospace Parts Inc., Standard Aero (San Antonio) Inc., Standard Aero (Alliance) Inc.,
Dunlop Standard Aerospace (Nederland) BV, Standard Aero BV, Standard Aero Limited, Standard Aero de
Mexico S.A. de CV, Standard Aero (Asia) Pte Limited and Standard Aero (Australia) Pty Limited (such
entities being referred to collectively as the “Acquired Business”). Collectively, the DSAG
Purchase Agreement, the ERO

 

 

Purchase Agreement and the Separation Agreement, dated as of July 5, 2004, among Meggitt
Acquisition Limited, Meggitt plc and Standard Aero Holdings, Inc. are referred to herein as the
“Acquisition Agreement.” The Company proposes to finance the Acquisition and any related premiums,
fees and expenses from the following sources: (1) $212,000,000 in equity of Holdings issued to the
Sponsor, which will be contributed as equity to the Company, (the “Equity Contribution”) (2)
$325,000,000 from a term loan facility to be entered into with a syndicate of financial
institutions, which syndicate will also extend a $50,000,000 revolving credit facility (none of
which is expected to be drawn at the time of the closing of the Acquisition) (the “Senior Credit
Facility” and, together with any other documents, agreements or instruments delivered in connection
therewith, the “Senior Credit Facility Documentation”), and (3) cash proceeds from the issuance of
$200,000,000 aggregate principal amount of the Securities. References herein to the “Transaction”
shall include the Acquisition, the financings described above and all other transactions related to
the Acquisition.

     On or prior to the Closing Date (as defined below), the Company will execute an escrow
agreement, in the form and substance to be agreed between the Company and the Initial Purchasers,
which shall conform in all material respects with the description thereof included in the Offering
Memorandum (the “Escrow Agreement”), and will direct the deposit in an escrow account (the “Escrow
Account) with J.P. Morgan Trust Company, NA, as escrow agent (the “Escrow Agent”), by the Initial
Purchasers of the gross proceeds of the offering of the Securities ($200,000,000), and will direct
the deposit to the Escrow Account of an additional $4,766,667 (to be provided either through a
letter of credit with terms and conditions reasonably satisfactory to the Initial Purchasers, with
the proceeds of the Equity Contribution, or with other funds provided by The Carlyle Group and its
affiliates), such that the escrowed funds (the “Escrow Funds”) are in an amount sufficient to
redeem the Securities at a price equal to the issue price of the Securities, plus accrued and
unpaid interest to October 4, 2004, and to pay an amount equal to 50% of the Initial Purchasers’
Commission (as defined below) (such additional amount, the “Additional Escrow Amount”), in the
event that the Acquisition is not consummated on or prior to September 30, 2004 or if the
Acquisition Agreement is terminated in accordance with its terms prior to such date. The Escrow
Agreement shall provide that the Escrowed Funds shall only be released and paid out pursuant to the
terms of the Escrow Agreement.

     Upon consummation of the Acquisition (such time, the “Acquisition Closing”), each subsidiary
of the Company listed on Schedule 3 hereto and which is required to be a Guarantor under the
Indenture will (i) enter into a joinder agreement to this Agreement, the form of which is attached
hereto as Exhibit A (the “Joinder Agreement”), pursuant to which it will become a party to this
Agreement, (ii) enter into a joinder agreement to the Registration Rights Agreement (as defined
below), (the “Joinder to the Registration Rights Agreement”) the form of which is attached hereto
as Exhibit B-2, pursuant to which it will become a party to the Registration Rights Agreement (as
defined below) and (iii) enter into the Supplemental Indenture, a form of which is attached to the
Indenture, pursuant to which each Guarantor will become a party to the Indenture.

     The representations, warranties and agreements herein of and relating to each of the
Guarantors shall not become effective until the Acquisition Closing, at which time such
representations, warranties and agreements shall become effective pursuant to the terms of the
Joinder Agreement and thereafter all representations, warranties, agreements and obligations of the
Company and the Guarantors hereunder shall be joint and several.

     The Securities will be sold to the Initial Purchasers without being registered under the
Securities Act of 1933, as amended (the “Securities Act”), in reliance upon an exemption therefrom.
The Company has prepared a preliminary offering memorandum dated August 9, 2004 (the “Preliminary
Offering Memorandum”) and will prepare an offering memorandum dated the date hereof (the “Offering

2

 

Memorandum”) setting forth information concerning the Company and the Securities. Copies of
the Preliminary Offering Memorandum have been, and copies of the Offering Memorandum will be,
delivered by the Company to the Initial Purchasers pursuant to the terms of this Agreement. The
Company hereby confirms that it has authorized the use of the Preliminary Offering Memorandum and
the Offering Memorandum in connection with the offering and resale of the Securities by the Initial
Purchasers in the manner contemplated by this Agreement.

     Holders of the Securities (including the Initial Purchasers and their direct and indirect
transferees) will be entitled to the benefits of a Registration Rights Agreement, to be dated the
Closing Date (as defined below) and substantially in the form attached hereto as Exhibit B (the
“Registration Rights Agreement”), pursuant to which the Company and the Guarantors will agree to
file one or more registration statements with the Securities and Exchange Commission (the
“Commission”) providing for the registration under the Securities Act of the Securities or the
Exchange Securities referred to (and as defined) in the Registration Rights Agreement.

     Capitalized terms used but not defined herein shall have the meanings given to such terms in
the Offering Memorandum.

     The Company hereby confirms its agreement with the several Initial Purchasers concerning the
purchase and resale of the Securities, as follows:

     1. Purchase and Resale of the Securities. (a) The Company agrees to issue and sell
the Securities to the several Initial Purchasers as provided in this Agreement, and each Initial
Purchaser, on the basis of the representations, warranties and agreements set forth herein and
subject to the conditions set forth herein, agrees, severally and not jointly, to purchase from the
Company the respective principal amount of Securities set forth opposite such Initial Purchaser’s
name in Schedule 1 hereto at a price equal to 100.00% of the principal amount thereof plus accrued
interest, if any, from August 20, 2004 to the Closing Date. The Initial Purchasers’ Commission
with respect to the Securities shall equal 2.75% of the aggregate principal amount of the
Securities. The Company will not be obligated to deliver any of the Securities except upon payment
for all the Securities to be purchased as provided herein.

     (b) The Company understands that the Initial Purchasers intend to offer the Securities for
resale on the terms set forth in the Offering Memorandum (the “Initial Offering”). Each Initial
Purchaser, severally and not jointly, represents, warrants and agrees that:

     (i) it is a qualified institutional buyer within the meaning of Rule 144A under the
Securities Act (a “QIB”) and an accredited investor within the meaning of Rule 501(a) under
the Securities Act;

     (ii) it has not solicited offers for, or offered or sold, and will not solicit offers
for, or offer or sell, the Securities by means of any form of general solicitation or
general advertising within the meaning of Rule 502(c) of Regulation D under the Securities
Act (“Regulation D”) or in any manner involving a public offering within the meaning of
Section 4(2) of the Securities Act; and

     (iii) it has not solicited offers for, or offered or sold, and will not solicit offers
for, or offer or sell, the Securities as part of the Initial Offering except:

     (A) within the United States to persons whom it reasonably believes to be QIBs
in transactions pursuant to Rule 144A under the Securities Act (“Rule 144A”) and in
connection with each such sale, it has taken or will take reasonable steps to ensure
that

3

 

the purchaser of the Securities is aware that such sale is being made in
reliance on Rule 144A; or

     (B) in accordance with the restrictions set forth in Annex A hereto.

     (c) Each Initial Purchaser acknowledges and agrees that the Company and, for purposes of the
opinions to be delivered to the Initial Purchasers pursuant to Sections 5(g) and 5(h), counsel for
the Company and the Guarantors and counsel for the Initial Purchasers, respectively, may rely upon
the accuracy of the representations and warranties of the Initial Purchasers, and compliance by the
Initial Purchasers with their agreements, contained in paragraph (b) above (including Annex A
hereto), and each Initial Purchaser hereby consents to such reliance.

     (d) The Company acknowledges and agrees that the Initial Purchasers may offer and sell
Securities to or through any affiliate of an Initial Purchaser and that any such affiliate may
offer and sell Securities purchased by it to or through any Initial Purchaser.

     2. Payment and Delivery. (a) Payment for and delivery of the Securities will be made
at the offices of Latham & Watkins LLP, 885 Third Avenue, New York, New York, at 10:00 A.M., New
York City time, on August 20, 2004, or at such other time or place on the same or such other date,
not later than the fifth business day thereafter, as the Representatives and the Company may agree
upon in writing. The time and date of such payment and delivery is referred to herein as the
“Closing Date”.

     (b) Delivery of the Securities by the Company shall be made to the Initial Purchasers against
payment of the purchase price by the Initial Purchasers, subject to the deposit of the Additional
Escrow Amount in the Escrow Account; and payment for the Securities by the Initial Purchasers shall
be made against delivery to the Initial Purchasers of the Securities as set forth below and
effected by wire transfer of immediately available funds to the Escrow Account. In the event the
Acquisition is consummated and the Escrow Funds are released pursuant to the terms of the Escrow
Agreement, the Company will direct the Escrow Agent to pay to the Initial Purchasers 100% of the
Initial Purchasers’ Commission. In the event of a Special Mandatory Redemption, the Company will
direct the Escrow Agent to pay to the Initial Purchasers the Initial Purchasers’ Special Redemption
Commission equal to 50% of the Initial Purchasers’ Commission in accordance with the Escrow
Agreement.

     (c) Payment for the Securities shall be made by wire transfer in immediately available funds
to the Escrow Account against delivery to the nominee of The Depository Trust Company, for the
account of the Initial Purchasers, of one or more global notes representing the Securities
(collectively, the “Global Note”), with any transfer taxes, if any, payable in connection with the
sale of the Securities duly paid by the Company. Upon delivery, the Securities shall be registered
in such names and in such denominations as the Representatives shall have requested in writing not
less than one full business day prior to the Closing Date. The Global Note will be made available
for inspection by the Representatives not later than 1:00 P.M., New York City time, on the business
day prior to the Closing Date.

     3. Representations and Warranties of the Company and the Guarantors. The Company and
the Guarantors jointly and severally represent and warrant to each Initial Purchaser that (it being
acknowledged and agreed that, unless the context indicates otherwise and subject to the fifth
paragraph of this Agreement, all representations and warranties that relate to the Company and its
subsidiaries, or the Company and the Guarantors, shall be deemed to relate to the Company and its
subsidiaries, or the Company and the Guarantors, after giving effect to the Acquisition Closing):

4

 

     (a) Offering Memorandum. The Preliminary Offering Memorandum, as of its date, did not, and
the Offering Memorandum, in the form first used by the Initial Purchasers to confirm sales of the
Securities and as of the Closing Date, will not, contain any untrue statement of a material fact or
omit to state a material fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading; provided that the Company and
the Guarantors make no representation or warranty with respect to any information contained in or
omitted from the Preliminary Offering Memorandum or the Offering Memorandum made in reliance upon
and in conformity with information relating to any Initial Purchaser furnished to the Company in
writing by such Initial Purchaser through the Representatives expressly for use in the Preliminary
Offering Memorandum and the Offering Memorandum.

     (b) Financial Statements.

     (i) Prior to the consummation of the Acquisition, the Company conducts no operations
and does not own any material assets, other than funds used to consummate the Acquisition.

     (ii) The historical financial statements and the related notes thereto included in the
Preliminary Offering Memorandum and the Offering Memorandum present fairly the financial
position of the Acquired Business as of the dates indicated and the results of its
operations and the changes in their cash flows for the periods specified. Such historical
financial statements have been prepared in conformity with generally accepted accounting
principles in the United States applied on a consistent basis throughout the periods covered
thereby.

     (iii) The summary and selected financial data set forth in the Offering Memorandum
under the captions “Summary—Summary historical and pro forma combined financial
information”, “Capitalization”, “Selected historical combined financial data”, “Unaudited
pro forma combined financial information”, and “Management’s discussion and analysis of
financial condition and results of operations” and the other financial information included
in the Preliminary Offering Memorandum and the Offering Memorandum have been derived from
the accounting records of the Acquired Business and fairly present in all material respects
the information set forth therein on the basis stated in the Preliminary Offering Memorandum
and the Offering Memorandum.

     (iv) The pro forma financial information and the notes related thereto
included in the Preliminary Offering Memorandum and the Offering Memorandum under the
heading “Unaudited Pro Forma Combined Financial Data” present fairly the information shown
therein and, with the exception of the inclusion of the pro forma financial
data for the twelve months ended June 30, 2004, have been prepared in all material respects
in accordance with the requirements of Regulation S-X promulgated under the Exchange Act.
The assumptions underlying such pro forma financial information are
reasonable and are set forth in the Preliminary Offering Memorandum and the Offering
Memorandum and the adjustments used therein are appropriate in all material respects to give
effect to the transactions or circumstances referred to therein.

     (c) No Material Adverse Change. Since the date of the most recent financial statements of the
Acquired Business included in the Preliminary Offering Memorandum and the Offering Memorandum, (i)
there has not been any change in the capital stock or long-term debt of the Company, or any
dividend or distribution of any kind declared, set aside for payment, paid or made by the Company
on any class of capital stock, or any material adverse change, or any development involving a
prospective

5

 

material adverse change, in or affecting the business, properties, financial position, or
results of operations of the Company and its subsidiaries, taken as a whole after giving effect to
the consummation of the Acquisition; (ii) neither the Company nor the Acquired Business has entered
into or currently intends to enter into any transaction or agreement that is material to the
Company or the Acquired Business taken as a whole or incurred any liability or obligation, direct
or contingent, that is material to the Company or the Acquired Business taken as a whole; and (iii)
neither the Company nor the Acquired Business has sustained any material loss or interference with
its business from fire, explosion, flood or other calamity, whether or not covered by insurance, or
from any labor disturbance or dispute or any action, order or decree of any court or arbitrator or
governmental or regulatory authority, except in each case as otherwise disclosed in the Preliminary
Offering Memorandum and the Offering Memorandum.

     (d) Organization and Good Standing. The Company and each of its subsidiaries have been duly
organized and are validly existing and in good standing (to the extent such qualification exists)
under the laws of their respective jurisdictions of organization, are duly qualified to do business
and are in good standing (to the extent such qualification exists) in each jurisdiction in which
their respective ownership or lease of property or the conduct of their respective businesses
requires such qualification, and have all power and authority necessary to own or hold their
respective properties and to conduct the businesses in which they are engaged, except in each case,
where the failure to be so qualified or have such power or authority would not, individually or in
the aggregate, have a material adverse effect on the business, properties, financial position, or
results of operations of the Company and its subsidiaries taken as a whole or on the performance by
the Company and the Guarantors of their obligations under the Securities and the Guarantees (a
“Material Adverse Effect”). The Company does not own or control, directly or indirectly, any
corporation, association or other entity other than the subsidiaries listed in Schedule 2 to this
Agreement.

     (e) Capitalization. As of the Closing Date, all the outstanding shares of capital stock or
other equity interests of the Company will have been duly authorized and validly issued, will be
fully paid and non-assessable, and as of the Acquisition Closing, all the outstanding shares of
capital stock or other equity interests of each of the Company’s subsidiaries will have been duly
and validly authorized and issued, will be fully paid and non-assessable and will be owned directly
or indirectly by the Company, free and clear of any lien, charge, encumbrance, security interest,
restriction on voting or transfer or any other claim of any third party except for those created
pursuant to the Senior Credit Facility Documentation.

     (f) Due Authorization. (i) The Company has full right, power and authority to execute and
deliver this Agreement, the Securities, the Indenture (including the Supplemental Indenture), the
Exchange Securities, the Escrow Agreement, the Joinder Agreement, the Registration Rights Agreement
and the Joinder to the Registration Rights Agreement (collectively, the “Offering Documents”) and
the Senior Credit Facility Documentation (together with the Offering Documents, the “Transaction
Documents”) and to perform its obligations hereunder and thereunder; and all action required to be
taken for the due and proper authorization, execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby has been duly and validly taken; and (ii) each
of the Guarantors has full right, power and authority to execute and deliver this Agreement, the
Securities, the Supplemental Indenture and each Guarantee set forth therein, the Exchange
Securities, the Joinder Agreement, the Registration Rights Agreement and the Joinder to the
Registration Rights Agreement and the Senior Credit Facility Documentation and to perform their
respective obligations hereunder and thereunder; and all action required to be taken for the due
and proper authorization, execution and delivery of this Agreement and the consummation of the
transactions contemplated hereby has been duly and validly taken, as of or prior to the Acquisition
Closing with respect to the Guarantors, all action required to be

6

 

taken for the due and proper authorization, execution and delivery of the Transaction
Documents and the consummation of the transactions contemplated thereby will have been duly and
validly taken.

     (g) The Indenture. On or prior to the Closing Date with respect to the Company, and or prior
to the Acquisition Closing with respect to the Guarantors, the Indenture (and, in the case of the
Guarantors, the Supplemental Indenture) will have been duly authorized by the Company and each of
the Guarantors and, when duly executed and delivered in accordance with its terms by each of the
parties thereto, will constitute a valid and legally binding agreement of the Company and each of
the Guarantors enforceable against the Company and each of the Guarantors in accordance with its
terms, except as enforceability may be limited by applicable bankruptcy, fraudulent conveyance,
insolvency, moratorium or similar laws affecting the enforcement of creditors’ rights generally or
by equitable principles relating to enforceability and by an implied covenant of good faith and
fair dealing (collectively, the “Enforceability Exceptions”); and as of each of the Closing Date
and the Acquisition Closing, the Indenture (including as supplemented by the Supplemental
Indenture) will conform in all material respects to the requirements of the Trust Indenture Act of
1939, as amended (the “Trust Indenture Act”), and the rules and regulations of the Commission
applicable to an indenture that is qualified thereunder; provided that it is understood and agreed
that no qualification under the Trust Indenture Act is required in connection with the offer and
sale of the Securities pursuant to this Agreement.

     (h) The Securities and the Guarantees. On or prior to the Closing Date, the Securities will
have been duly authorized by the Company and, when duly executed, authenticated, issued and
delivered as provided in the Indenture and paid for as provided herein, will be duly and validly
issued and outstanding and will constitute valid and legally binding obligations of the Company
enforceable against the Company in accordance with their terms, and will be entitled to the
benefits of the Indenture, in each case subject to the Enforceability Exemptions; and on or prior
to the Acquisition Closing, the Guarantees will have been duly authorized by each of the Guarantors
and, when the Supplemental Indenture has been duly executed, authenticated, issued and delivered,
as provided in the Supplemental Indenture and the Indenture, will be valid and legally binding
obligations of each of the Guarantors, enforceable against each of the Guarantors in accordance
with their terms, and will be entitled to the benefits of the Indenture, in each case subject to
the Enforceability Exceptions,

     (i) The Exchange Securities. On the Closing Date with respect to the Company, and as of the
Acquisition Closing with respect to the Guarantors, the Exchange Securities (including the related
guarantees) will have been duly authorized by the Company and each of the Guarantors and, when duly
executed, authenticated, issued and delivered as contemplated by the Registration Rights Agreement
and the Indenture, will be duly and validly issued and outstanding and will constitute valid and
legally binding obligations of the Company, as issuer, and each of the Guarantors, as guarantor,
enforceable against the Company and each of the Guarantors in accordance with their terms, and will
be entitled to the benefits of the Indenture subject to the Enforceability Exceptions,.

     (j) The Escrow Agreement. On or prior to the Closing Date, the Escrow Agreement will have
been duly authorized by the Company and, when duly executed and delivered by the Company
assuming due authorization, execution and delivery by the Escrow Agent, the Escrow Agreement will
constitute a valid and legally binding agreement of the Company, enforceable against the Company in
accordance with its terms, subject to the Enforceability Exceptions; and the Escrow Agreement will
conform, when executed and delivered, in all material respects to the description thereof contained
in the Offering Memorandum.

     (k) Purchase Agreement and Registration Rights Agreement. This Agreement has been duly
authorized, executed and delivered by the Company; and on or prior to the Closing Date with respect
to the Company, and as of the Acquisition Closing with respect to the Guarantors, the Registration
Rights

7

 

Agreement will have been duly authorized by the Company and each of the Guarantors and, when
duly executed and delivered in accordance with its terms by each of the parties thereto, will
constitute a valid and legally binding agreement of the Company and each of the Guarantors
enforceable against the Company and each of the Guarantors in accordance with its terms, subject to
the Enforceability Exceptions, and except that rights to indemnity and contribution thereunder may
be limited by applicable law and public policy.

     (l) Joinder Agreement. As of the Acquisition Closing, the Joinder Agreement, when duly
executed and delivered in accordance with its terms by each of the parties thereto, will constitute
a valid and legally binding agreement of each of the Guarantors thereto, enforceable against each
of the Guarantors party thereto in accordance with its terms, subject to the Enforceability
Exceptions.

     (m) Joinder to the Registration Rights Agreement. As of the Acquisition Closing, the Joinder
to the Registration Rights Agreement, when duly executed and delivered in accordance with its terms
by each of the parties thereto, will constitute a valid and legally binding agreement of each of
the Guarantors thereto, enforceable against each of the Guarantors party thereto in accordance with
its terms, subject to the Enforceability Exceptions.

     (n) Other Transaction Documents. On or prior to the Acquisition Closing, the Senior Credit
Facility Documentation will have been duly authorized by the Company and, to the extent a party
thereto, its subsidiaries and, when executed and delivered in accordance with their terms by the
Company and, to the extent a party thereto, its subsidiaries, will constitute a valid and legally
binding agreement of the Company and, to the extent a party thereto, its subsidiaries, enforceable
against the Company and, to the extent a party thereto, its subsidiaries in accordance with their
respective terms, subject to the Enforceability Exceptions.

     (o) Descriptions of the Transaction Documents. Each Transaction Document conforms in all
material respects to the description thereof contained in the Preliminary Offering Memorandum and
the Offering Memorandum.

     (p) No Violation or Default. Neither the Company nor any of its subsidiaries is (i) in
violation of its charter or by-laws or similar organizational documents; (ii) in default, and no
event has occurred that, with notice or lapse of time or both, would constitute such a default, in
the due performance or observance of any term, covenant or condition contained in any indenture,
mortgage, deed of trust, loan agreement or other agreement or instrument to which the Company or
any of its subsidiaries is a party or by which the Company or any of its subsidiaries is bound or
to which any of the property or assets of the Company or any of its subsidiaries is subject; or
(iii) in violation of any law or statute or any judgment, order, rule or regulation of any court or
arbitrator or governmental or regulatory authority, except, in the case of clauses (ii) and (iii)
above, for any such default or violation that would not, individually or in the aggregate, have a
Material Adverse Effect.

     (q) No Conflicts. The execution, delivery and performance by the Company and each of the
Guarantors of each of the Transaction Documents to which each is a party, the issuance and sale of
the Securities (including the Guarantees) and compliance by the Company and each of the Guarantors
with the terms thereof and the consummation of the transactions contemplated by the Transaction
Documents will not (i) conflict with or result in a breach or violation of any of the terms or
provisions of, or constitute a default under, or, except for those created under the Escrow
Agreement or the Senior Credit Facility Documentation, result in the creation or imposition of any
lien, charge or encumbrance upon any property or assets of the Company or any of its subsidiaries
pursuant to, any indenture, mortgage, deed of trust, loan agreement or other agreement or
instrument to which the Company or any of its subsidiaries is a party or by which the Company or
any of its subsidiaries is bound or to which any of the property or

8

 

assets of the Company or any of its subsidiaries is subject, (ii) result in any violation of
the provisions of the charter or by-laws or similar organizational documents of the Company or any
of its subsidiaries or (iii) result in the violation of any law or statute or any judgment, order,
rule or regulation of any court or arbitrator or governmental or regulatory authority, except, in
the case of clauses (i) and (iii) above, for any such conflict, breach or violation that would not,
individually or in the aggregate, have a Material Adverse Effect.

     (r) No Consents Required. No consent, approval, authorization, order, registration or
qualification of or with any court or arbitrator or governmental or regulatory authority is
required for (i) the execution, delivery and performance by the Company and each of the Guarantors
of each of the Transaction Documents to which each is a party, (ii) the issuance and sale of the
Securities (including the Guarantees) and compliance by the Company and each of the Guarantors with
the terms thereof and (iii) the consummation of the transactions contemplated by the Transaction
Documents, except for such consents, approvals, authorizations, orders and registrations or
qualifications (x) which shall have been obtained or made on or prior to the Closing Date, (y) as
may be required (i) under applicable state securities laws in connection with the purchase and
resale of the Securities by the Initial Purchasers and (ii) with respect to the Exchange Securities
(including the related guarantees) under the Securities Act and applicable state securities laws as
contemplated by the Registration Rights Agreement and (z) with respect to clauses (i) and (iii),
where failure to obtain such consents, approvals, authorizations, orders and registrations or
qualifications would not individually or in the aggregate, have a material adverse effect on the
transactions contemplated by the Transaction Documents or have a Material Adverse Effect.

     (s) Legal Proceedings. Except as described in the Preliminary Offering Memorandum and the
Offering Memorandum, there are no legal, governmental or regulatory investigations, actions, suits
or proceedings pending to which the Company or any of its subsidiaries is or may be a party or to
which any property of the Company or any of its subsidiaries is or may be the subject that,
individually or in the aggregate, if determined adversely to the Company or any of its
subsidiaries, could reasonably be expected to have a Material Adverse Effect; and to the best
knowledge of the Company and each of the Guarantors, no such investigations, actions, suits or
proceedings are threatened or contemplated by any governmental or regulatory authority or
threatened by others.

     (t) Independent Auditors. PricewaterhouseCoopers LLP, who have audited and reviewed certain
financial statements of the Acquired Business, are independent public accountants with respect to
the Company and the Acquired Business within the meaning of Rule 101 of the Code of Professional
Conduct of the American Institute of Certified Public Accountants and its interpretations and
rulings thereunder.

     (u) Title to Real and Personal Property. The Company and its subsidiaries have good and
marketable title in fee simple to, or have valid rights to lease or otherwise use, all items of
real and personal property that are material to the respective businesses of the Company and its
subsidiaries, in each case free and clear of all liens, encumbrances, claims and defects and
imperfections of title except those liens (i) created to secure obligations under the Senior Credit
Facilities; (ii) that do not materially interfere with the use made and proposed to be made of such
property by the Company and its subsidiaries; or (iii) that could not reasonably be expected,
individually or in the aggregate, to have a Material Adverse Effect.

     (v) Title to Intellectual Property. The Company and its subsidiaries own or possess adequate
rights to use all patents, patent applications, trademarks, service marks, trade names, trademark
registrations, service mark registrations, copyrights, licenses and know-how (including trade
secrets and other unpatented and/or unpatentable proprietary or confidential information, systems
or procedures)

9

 

necessary for the conduct of their respective businesses; and the conduct of their respective
businesses will not conflict in any respect with any such rights of others, and the Company and its
subsidiaries have not received any notice of any claim of infringement of or conflict with any such
rights of others except where such conflict or failure to own or possess such rights could not
reasonably be expected to have a Material Adverse Effect.

     (w) Investment Company Act. Neither the Company nor any of its subsidiaries is, and after
giving effect to the offering and sale of the Securities and the application of the proceeds
thereof as described in the Offering Memorandum none of them will be, an “investment company” or an
entity “controlled” by an “investment company” within the meaning of the Investment Company Act of
1940, as amended, and the rules and regulations of the Commission thereunder (collectively,
“Investment Company Act”).

     (x) Taxes. The Company and its subsidiaries have paid all federal and state taxes and filed
all federal and state tax returns required to be paid or filed through the date hereof and have
paid all material local and foreign taxes and filed all material local and foreign tax returns
required to the paid or filed through the date hereof; and except as otherwise disclosed in the
Preliminary Offering Memorandum and the Offering Memorandum, there is no tax deficiency that has
been, or could reasonably be expected to be, asserted against the Company or any of its
subsidiaries or any of their respective properties or assets and for which adequate reserves, in
conformity with GAAP, have not been established.

     (y) Licenses and Permits. The Company and its subsidiaries possess all licenses,
certificates, permits and other authorizations issued by, and have made all declarations and
filings with, the appropriate federal, state, local or foreign governmental or regulatory
authorities that are necessary for the ownership or lease of their respective properties or the
conduct of their respective businesses as described in the Preliminary Offering Memorandum and the
Offering Memorandum, except where the failure to possess or make the same would not, individually
or in the aggregate, have a Material Adverse Effect; and except as described in the Preliminary
Offering Memorandum and the Offering Memorandum, neither the Company nor any of its subsidiaries
has received notice of any revocation or modification of any such license, certificate, permit or
authorization or has any reason to believe that any such license, certificate, permit or
authorization will not be renewed in the ordinary course except where failure to possess the same
could not, individually or in the aggregate, reasonably be expected to have a Material Adverse
Effect.

     (z) No Labor Disputes. No labor disturbance by or dispute with employees of the Company or
any of its subsidiaries exists or, to the best knowledge of the Company and each of its
subsidiaries, is contemplated or threatened.

     (aa) Compliance With Environmental Laws. The Company and its subsidiaries (i) are in
compliance with any and all applicable federal, state, local and foreign laws, rules, regulations,
decisions and orders relating to the protection of human health and safety, the environment or
hazardous or toxic substances or wastes, pollutants or contaminants (collectively, “Environmental
Laws”); (ii) have received and are in compliance with all permits, licenses or other approvals
required of them under applicable Environmental Laws to conduct their respective businesses; and
(iii) have not received notice of any actual or potential liability for the investigation or
remediation of any disposal or release of hazardous or toxic substances or wastes, pollutants or
contaminants, except in any such case for any such failure to comply with, or failure to receive
required permits, licenses or approvals, or liability, as would not, individually or in the
aggregate, have a Material Adverse Effect.

10

 

     (bb) Compliance With ERISA. Except as would not reasonably be expected, individually or in
the aggregate, to have a Material Adverse Effect, each employee benefit plan, within the meaning
of Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), that
is maintained, administered or contributed to by the Company or any of its subsidiaries for
employees or former employees of the Company or any of its subsidiaries has been maintained in
compliance with its terms and the requirements of any applicable statutes, orders, rules and
regulations, including but not limited to ERISA and the Internal Revenue Code of 1986, as amended
(the “Code”); no prohibited transaction, within the meaning of Section 406 of ERISA or Section 4975
of the Code, has occurred with respect to any such plan (excluding transactions effected pursuant
to a statutory or administrative exemption) which has not been remedied; and no such plan is
subject to Title IV of ERISA.

     (cc) Accounting Controls. The Company and its subsidiaries maintain systems of internal
accounting controls sufficient to provide reasonable assurance that (i) transactions are executed
in accordance with management’s general or specific authorizations; (ii) transactions are recorded
as necessary to permit preparation of financial statements in conformity with generally accepted
accounting principles and to maintain asset accountability; (iii) access to assets is permitted
only in accordance with management’s general or specific authorization; and (iv) the recorded
accountability for assets is compared with the existing assets at reasonable intervals and
appropriate action is taken with respect to any differences.

     (dd) Insurance. The Company and its subsidiaries have insurance covering their respective
properties, operations, personnel and businesses, including business interruption insurance, which
insurance is in amounts and insures against such losses and risks as are adequate to protect the
Company and its subsidiaries and their respective businesses; and neither the Company nor any of
its subsidiaries has (i) received notice from any insurer or agent of such insurer that capital
improvements or other expenditures are required or necessary to be made in order to continue such
insurance or (ii) any reason to believe that it will not be able to renew its existing insurance
coverage as and when such coverage expires or to obtain similar coverage at reasonable cost from
similar insurers as may be necessary to continue its business.

     (ee) No Unlawful Payments. Neither the Company nor any of its subsidiaries nor, to the best
knowledge of the Company and each of the Guarantors, any director, officer, agent, employee or
other person associated with or acting on behalf of the Company or any of it subsidiaries has (i)
used any corporate funds for any unlawful contribution, gift, entertainment or other unlawful
expense relating to political activity; (ii) made any direct or indirect unlawful payment to any
domestic government official or employee from corporate funds; (iii) violated or is in violation of
any provision of the Foreign Corrupt Practices Act of 1977; or (iv) made any bribe, rebate, payoff,
influence payment, kickback or other unlawful payment.

     (ff) Solvency. On and immediately after the Acquisition Closing, the Company (after giving
effect to the issuance of the Securities and the other transactions related thereto as described in
the Offering Memorandum) will be Solvent. As used in this paragraph, the term “Solvent” means,
with respect to a particular date, that on such date (i) the present fair market value (or present
fair saleable value) of the assets of the Company is not less than the total amount required to pay
the liabilities of the Company on its total existing debts and liabilities (including contingent
liabilities) as they become absolute and matured; (ii) the Company is able to realize upon its
assets and pay its debts and other liabilities, contingent obligations and commitments as they
mature and become due in the normal course of business; (iii) the Company is not incurring debts or
liabilities beyond its ability to pay as such debts and liabilities mature; and (iv) the Company is
not engaged in any business or transaction, and does not propose to engage in any business or
transaction, for which its property would constitute unreasonably

11

 

small capital after giving due consideration to the prevailing practice in the industry in
which the Company is engaged.

     (gg) No Restrictions on Subsidiaries. No subsidiary of the Company is prohibited, directly or
indirectly, under any agreement or other instrument to which it is a party or is subject, from
paying any dividends to the Company, from making any other distribution on such subsidiary’s
capital stock, from repaying to the Company any loans or advances to such subsidiary from the
Company or from transferring any of such subsidiary’s properties or assets to the Company or any
other subsidiary of the Company except as otherwise disclosed in the Offering Memorandum.

     (hh) No Broker’s Fees. Except with respect to the Engagement Letter dated as of June 15,
2004, by and among Standard Aero Acquisition Holdings, Inc., Standard Aero Holdings, Inc., J.P.
Morgan Securities Inc., Lehman Brothers Inc. and Credit Suisse First Boston, neither the Company
nor any Guarantor is a party to any contract, agreement or understanding with any person (other
than this Agreement) that would give rise to a valid claim against any of them or any Initial
Purchaser for a brokerage commission, finder’s fee or like payment in connection with the offering
and sale of the Securities.

     (ii) Rule 144A Eligibility. On the Closing Date, the Securities will not be of the same class
as securities listed on a national securities exchange registered under Section 6 of the Exchange
Act or quoted in an automated inter-dealer quotation system; and each of the Preliminary Offering
Memorandum and the Offering Memorandum, as of its respective date, contains or will contain all the
information that, if requested by a prospective purchaser of the Securities, would be required to
be provided to such prospective purchaser pursuant to Rule 144A(d)(4) under the Securities Act.

     (jj) No Integration. Neither the Company nor any of its affiliates (as defined in Rule 501(b)
of Regulation D) has, directly or through any agent, sold, offered for sale, solicited offers to
buy or otherwise negotiated in respect of, any security (as defined in the Securities Act), that is
or will be integrated with the sale of the Securities in a manner that would require registration
of the Securities under the Securities Act.

     (kk) No General Solicitation or Directed Selling Efforts. None of the Company or any of its
affiliates or any other person acting on its or their behalf (other than the Initial Purchasers, as
to which no representation is made) has (i) solicited offers for, or offered or sold, the
Securities by means of any form of general solicitation or general advertising within the meaning
of Rule 502(c) of Regulation D or in any manner involving a public offering within the meaning of
Section 4(2) of the Securities Act or (ii) engaged in any directed selling efforts within the
meaning of Regulation S under the Securities Act (“Regulation S”), and all such persons have
complied with the offering restrictions requirement of Regulation S.

     (ll) Securities Law Exemptions. Assuming the accuracy of the representations and warranties
of the Initial Purchasers contained in Section 1(b) (including Annex A hereto) and their compliance
with their agreements set forth therein, it is not necessary, in connection with the issuance and
sale of the Securities to the Initial Purchasers and the offer, resale and delivery of the
Securities by the Initial Purchasers in the manner contemplated by this Agreement and the Offering
Memorandum, to register the Securities under the Securities Act or to qualify the Indenture under
the Trust Indenture Act.

     (mm) No Stabilization. Neither the Company nor any of the Guarantors has taken, directly or
indirectly, any action designed to or that could reasonably be expected to cause or result in any
stabilization or manipulation of the price of the Securities.

12

 

     (nn) Margin Rules. Neither the issuance, sale and delivery of the Securities nor the
application of the proceeds thereof by the Company as described in the Offering Memorandum will
violate Regulation T, U or X of the Board of Governors of the Federal Reserve System or any other
regulation of such Board of Governors.

     (oo) Forward-Looking Statements. No forward-looking statement (within the meaning of Section
27A of the Securities Act and Section 21E of the Exchange Act) contained in the Preliminary
Offering Memorandum and the Offering Memorandum has been made or reaffirmed without a reasonable
basis or has been disclosed other than in good faith.

     (pp) Statistical and Market Data. Nothing has come to the attention of the Company that has
caused the Company to believe that the statistical and market-related data included in the
Preliminary Offering Memorandum or the Offering Memorandum is not based on or derived from sources
that are reliable and accurate in all material respects.

     4. Further Agreements of the Company and the Guarantors. The Company and each of the
Guarantors jointly and severally covenant and agree with each Initial Purchaser that:

     (a) Delivery of Copies. The Company will deliver to the Initial Purchasers as many copies of
the Preliminary Offering Memorandum and the Offering Memorandum (including all amendments and
supplements thereto) as the Representatives may reasonably request.

     (b) Amendments or Supplements. Before making or distributing any amendment or supplement to
the Preliminary Offering Memorandum or the Offering Memorandum, the Company will furnish to the
Representatives and counsel for the Initial Purchasers a copy of the proposed amendment or
supplement for review, and will not distribute any such proposed amendment or supplement to which
the Representatives reasonably object.

     (c) Notice to the Representatives. The Company will advise the Representatives promptly, and
confirm such advice in writing, (i) of the issuance by any governmental or regulatory authority of
any order preventing or suspending the use of the Preliminary Offering Memorandum or the Offering
Memorandum or the initiation or threatening of any proceeding for that purpose; (ii) of the
occurrence of any event at any time prior to the completion of the Initial Offering of the
Securities as a result of which the Offering Memorandum as then amended or supplemented would
include any untrue statement of a material fact or omit to state a material fact necessary in order
to make the statements therein, in the light of the circumstances existing when the Offering
Memorandum is delivered to a purchaser, not misleading; and (iii) of the receipt by the Company of
any notice with respect to any suspension of the qualification of the Securities for offer and sale
in any jurisdiction or the initiation or threatening of any proceeding for such purpose; and the
Company will use its reasonable best efforts to prevent the issuance of any such order preventing
or suspending the use of the Preliminary Offering Memorandum or the Offering Memorandum or
suspending any such qualification of the Securities and, if any such order is issued, will obtain
as soon as possible the withdrawal thereof.

     (d) Ongoing Compliance of the Offering Memorandum. If at any time prior to the completion of
the Initial Offering of the Securities (i) any event shall occur or condition shall exist as a
result of which the Offering Memorandum as then amended or supplemented would include any untrue
statement of a material fact or omit to state any material fact necessary in order to make the
statements therein, in the light of the circumstances existing when the Offering Memorandum is
delivered to a purchaser, not misleading or (ii) it is necessary to amend or supplement the
Offering Memorandum to comply with law, the Company will immediately notify the Initial Purchasers
thereof and forthwith

13

 

prepare and, subject to paragraph (b) above, furnish to the Initial Purchasers such amendments
or supplements to the Offering Memorandum as may be necessary so that the statements in the
Offering Memorandum as so amended or supplemented will not, in the light of the circumstances
existing when the Offering Memorandum is delivered to a purchaser, be misleading or so that the
Offering Memorandum will comply with law.

     (e) Blue Sky Compliance. The Company will qualify the Securities for offer and sale under the
securities or Blue Sky laws of such jurisdictions as the Representatives shall reasonably request
and will continue such qualifications in effect so long as required for the offering and resale of
the Securities; provided that neither the Company nor any of the Guarantors shall be
required to (i) qualify as a foreign corporation or other entity or as a dealer in securities in
any such jurisdiction where it would not otherwise be required to so qualify, (ii) file any general
consent to service of process in any such jurisdiction or (iii) subject itself to taxation in any
such jurisdiction if it is not otherwise so subject.

     (f) Clear Market. During the period from the date hereof through and including the date that
is 180 days after the date hereof, the Company and each of the Guarantors will not, without the
prior written consent of the Representatives, offer, sell, contract to sell or otherwise dispose of
any debt securities issued or guaranteed by the Company or any of the Guarantors and having a tenor
of more than one year (which, in any case, shall exclude the Exchange Securities and borrowings
under the Senior Credit Facilities).

     (g) Use of Proceeds. The Company will apply in all material respects the net proceeds from
the sale of the Securities as described in the Offering Memorandum under the heading “Use of
Proceeds”.

     (h) Supplying Information. While the Securities remain outstanding and are “restricted
securities” within the meaning of Rule 144(a)(3) under the Securities Act, the Company and each of
the Guarantors will, during any period in which the Company is not subject to and in compliance
with Section 13 or 15(d) of the Exchange Act, furnish to holders of the Securities and prospective
purchasers of the Securities designated by such holders, upon the request of such holders or such
prospective purchasers, the information required to be delivered pursuant to Rule 144A(d)(4) under
the Securities Act.

     (i) PORTAL and DTC. The Company will assist the Initial Purchasers in arranging for the
Securities to be designated Private Offerings, Resales and Trading through Automated Linkages
(“PORTAL”) Market securities in accordance with the rules and regulations adopted by the National
Association of Securities Dealers, Inc. (“NASD”) relating to trading in the PORTAL Market and for
the Securities to be eligible for clearance and settlement through The Depository Trust Company
(“DTC”).

     (j) No Resales by the Company. Until the issuance of the Exchange Securities, the Company
will not, and will not permit any of its affiliates (as defined in Rule 144 under the Securities
Act) to, resell any of the Securities that have been acquired by any of them, except for Securities
purchased by the Company or any of its affiliates and resold in a transaction registered under the
Securities Act.

     (k) No Integration. Neither the Company nor any of its affiliates (as defined in Rule 501(b)
of Regulation D) will, directly or through any agent, sell, offer for sale, solicit offers to buy
or otherwise negotiate in respect of, any security (as defined in the Securities Act), that is or
will be integrated with the sale of the Securities in a manner that would require registration of
the Securities under the Securities Act.

     (l) No General Solicitation or Directed Selling Efforts. None of the Company or any of its
affiliates or any other person acting on its or their behalf (other than the Initial Purchasers, as
to which no covenant is given) will (i) solicit offers for, or offer or sell, the Securities by
means of any form of general

14

 

solicitation or general advertising within the meaning of Rule 502(c) of Regulation D or in
any manner involving a public offering within the meaning of Section 4(2) of the Securities Act or
(ii) engage in any directed selling efforts within the meaning of Regulation S, and all such
persons will comply with the offering restrictions requirement of Regulation S.

     (m) No Stabilization. Neither the Company nor any of the Guarantors will take, directly or
indirectly, any action designed to or that could reasonably be expected to cause or result in any
stabilization or manipulation of the price of the Securities.

     (n) Special Covenants of the Guarantors. Upon the Acquisition Closing, each subsidiary of the
Company that is required to be a Guarantor under the Indenture shall become a party to (i) this
Agreement by executing and delivering the Joinder Agreement, (ii) the Registration Rights Agreement
by executing and delivering the Joinder to the Registration Rights Agreement and (iii) the
Indenture by executing and delivering the Supplemental Indenture.

     (o) Latham & Watkins Opinion Delivery upon Acquisition Closing. Upon the Acquisition Closing,
the Company shall cause Latham & Watkins LLP, as counsel for the Company and the Guarantors, to
furnish their written opinion addressed to the Initial Purchasers and dated the date on which the
Acquisition is consummated, in the form attached hereto as Annex D-2.

     (p) Opinion of Special Canadian Counsel upon Acquisition Closing. Upon the Acquisition
Closing, the Company shall cause each of Stikeman & Elliot LLP and Stewart McKelvey Stirling
Scales, as special Canadian counsel for the Company and the Guarantors, to furnish their written
opinions addressed to the Initial Purchasers and dated the date on which the Acquisition is
consummated, each in a form to be mutually agreed upon and substantially to the effect as set forth
in Annex D-3.

     (q) Opinion of Special Dutch Counsel upon Acquisition Closing. Upon the Acquisition Closing,
the Company shall cause Nauta Dutilh, as special Dutch counsel for the Company and the Guarantors,
to furnish their written opinion addressed to the Initial Purchasers and dated the date on which
the Acquisition is consummated, in a form to be mutually agreed upon and substantially to the
effect as set forth in Annex D-3.

     (r) Good Standing Certificates. Upon the Acquisition Closing, the Company shall provide to
the Initial Purchasers at the Acquisition Closing, satisfactory evidence of the good standing of
each of the Guarantors in their respective jurisdictions of organization and their good standing in
such other jurisdictions as the Initial Purchasers may reasonably request, in each case in writing
or by any standard form of telecommunication, from the appropriate governmental authorities of such
jurisdictions.

     (s) Payment of Initial Purchasers’ Commission. Upon the Acquisition Closing, the Company
shall, on the date of the consummation of the Acquisition, pay the Initial Purchasers’ Commission
as provided under Section 2(b) of this Agreement.

     (t) Guarantor Certificates. Upon the Acquisition Closing, the Guarantors shall provide to the
Initial Purchasers certificates in the forms attached hereto as Annex B-2 and C-2.

     5. Conditions of Initial Purchasers’ Obligations. The obligation of each Initial
Purchaser to purchase Securities on the Closing Date as provided herein is subject to the
performance by the Company of its covenants and other obligations hereunder and to the following
additional conditions:

     (a) Representations and Warranties. The representations and warranties of the Company
(including, without limitation, those relating to the Acquired Business) contained herein shall be
true and

15

 

correct on the date hereof and on and as of the Closing Date; and the statements of the
Company and its officers made in any certificates delivered pursuant to this Agreement shall be
true and correct on and as of the Closing Date.

     (b) No Downgrade. Subsequent to the execution and delivery of this Agreement, (i) no
downgrading shall have occurred in the rating accorded the Securities or any other debt securities
or preferred stock issued or guaranteed by the Company by any “nationally recognized statistical
rating organization”, as such term is defined by the Commission for purposes of Rule 436(g)(2)
under the Securities Act; and (ii) no such organization shall have publicly announced that it has
under surveillance or review, or has changed its outlook with respect to, its rating of the
Securities or of any other debt securities or preferred stock issued or guaranteed by the Company
(other than an announcement with positive implications of a possible upgrading).

     (c) No Material Adverse Change. Subsequent to the execution and delivery of this Agreement,
no event or condition of a type described in Section 3(c) hereof shall have occurred or shall
exist, which event or condition is not described in the Offering Memorandum (excluding any
amendment or supplement thereto) and the effect of which, in the reasonable judgment of the
Representatives makes it impracticable or inadvisable to proceed with the offering, sale or
delivery of the Securities on the terms and in the manner contemplated by this Agreement and the
Offering Memorandum.

     (d) Officers’ Certificates. The Representatives shall have received (i) on and as of the
Closing Date a certificate of the chief executive officer and the president of the Company in form
and substance satisfactory to the Representatives, substantially to the effect set forth in Annex
B-1 hereto and (ii) on the date hereof and as of the Closing Date, a certificate with respect to
certain financial data contained in the Preliminary Offering Memorandum and the Offering
Memorandum, providing “management comfort” with respect to such information to the extent
PricewaterhouseCoopers LLC is unable to provide such comfort, substantially to the effect set forth
in Annex B-3 hereto; provided that the certificate delivered on the Closing Date shall use
a “cut-off” date that is the same as the cut-off date as the bring-down comfort letter delivered
pursuant to clause 5(f).

     (e) Secretary’s Certificates. The Representatives shall have received on and as of the
Closing Date a certificate of the secretary or assistant secretary of the Company, such certificate
in form and substance satisfactory to the Representatives, substantially to the effect set forth in
Annex C-1, hereto.

     (f) Comfort Letters of PricewaterhouseCoopers LLP. On the date of this Agreement and on the
Closing Date, PricewaterhouseCoopers LLP shall have furnished to the Representatives, at the
request of the Company, letters, dated the respective dates of delivery thereof and addressed to
the Representatives as representatives of the Initial Purchasers, in form and substance reasonably
satisfactory to the Representatives and PricewaterhouseCoopers LLP, containing statements and
information of the type customarily included in accountants’ “comfort letters” to underwriters with
respect to the financial statements and certain financial information contained in the Preliminary
Offering Memorandum and the Offering Memorandum; provided that the letter delivered on the
Closing Date shall use a “cut-off” date no more than three business days prior to the Closing Date.

     (g) Opinion of Counsel for the Company and the Guarantors. Latham & Watkins LLP shall have
furnished to the Initial Purchasers its written opinions and 10b-5 negative assurance letter, as
counsel to the Company and the Guarantors, addressed to the Initial Purchasers and dated the
Closing Date, in form and substance reasonably satisfactory to the Representatives, to the effect
set forth in Annex D-1 hereto.

16

 

     (h) Opinion of Counsel for the Initial Purchasers. The Initial Purchasers shall have
received on and as of the Closing Date an opinion of Simpson Thacher & Bartlett LLP, counsel for
the Initial Purchasers, with respect to such matters as the Representatives may reasonably request,
and such counsel shall have received such documents and information as they may reasonably request
to enable them to pass upon such matters.

     (i) No Legal Impediment to Issuance. No action shall have been taken and no statute, rule,
regulation or order shall have been enacted, adopted or issued by any federal, state or foreign
governmental or regulatory authority that would, as of the Closing Date, prevent the issuance or
sale of the Securities or the issuance of the Guarantees; and no injunction or order of any
federal, state or foreign court shall have been issued that would, as of the Closing Date and as of
the Acquisition Closing, prevent the issuance or sale of the Securities or the issuance of the
Guarantees.

     (j) Good Standing. The Representatives shall have received on and as of a date within 5 days
of the Closing Date satisfactory evidence of the good standing of the Company and the Acquired
Businesses in their respective jurisdictions of organization and its good standing in such other
jurisdictions as the Representatives may reasonably request, in each case in writing or any
standard form of telecommunication, from the appropriate governmental authorities of such
jurisdictions.

     (k) Registration Rights Agreement. The Initial Purchasers shall have received a counterpart
of the Registration Rights Agreement that shall have been executed and delivered by a duly
authorized officer of the Company.

     (l) Escrow Agreement. The Initial Purchasers shall have received counterparts of the Escrow
Agreement which shall have been executed and delivered by a duly authorized officer of each of the
Company and the Escrow Agent.

     (m) PORTAL and DTC. The Securities shall have been approved by the NASD for trading in the
PORTAL Market and shall be eligible for clearance and settlement through DTC.

     (n) Additional Documents. On or prior to the Closing Date, the Company shall have furnished
to the Representatives such further certificates and documents as the Representatives may
reasonably request.

     (o) Escrow Deposit. The Additional Escrow Amount shall have been deposited in the Escrow
Amount.

     All opinions, letters, certificates and evidence mentioned above or elsewhere in this
Agreement shall be deemed to be in compliance with the provisions hereof only if they are in form
and substance reasonably satisfactory to counsel for the Initial Purchasers.

     6. Indemnification and Contribution.

     (a) Indemnification of the Initial Purchasers. The Company and each of the Guarantors jointly
and severally agree to indemnify and hold harmless each Initial Purchaser, its affiliates,
directors and officers and each person, if any, who controls such Initial Purchaser within the
meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act, from and against any
and all losses, claims, damages and liabilities (including, without limitation, legal fees and
other expenses incurred in connection with any suit, action or proceeding or any claim asserted, as
such fees and expenses are incurred), joint or several, that arise out of, or are based upon, any
untrue statement or alleged untrue statement of a material fact contained in the Preliminary
Offering Memorandum or the Offering

17

 

Memorandum (or any amendment or supplement thereto) or any omission or alleged omission to
state therein a material fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading, except insofar as such losses,
claims, damages or liabilities arise out of, or are based upon, any untrue statement or omission or
alleged untrue statement or omission made in reliance upon and in conformity with any information
relating to any Initial Purchaser furnished to the Company in writing by such Initial Purchaser
through the Representatives expressly for use therein; provided that with respect to any
such untrue statement in or omission from the Preliminary Offering Memorandum, the indemnity
agreement contained in this paragraph (a) shall not inure to the benefit of any Initial Purchaser
to the extent that the sale to the person asserting any such loss, claim, damage or liability was
an initial resale by such Initial Purchaser and any such loss, claim, damage or liability of or
with respect to such Initial Purchaser results from the fact that both (i) a copy of the Offering
Memorandum was not sent or given to such person at or prior to the written confirmation of the sale
of such Securities to such person and (ii) the untrue statement in or omission from such
Preliminary Offering Memorandum was corrected in the Offering Memorandum unless, in either case,
such failure to deliver the Offering Memorandum was a result of non-compliance by the Company with
the provisions of Section 4(a) hereof.

     (b) Indemnification of the Company. Each Initial Purchaser agrees, severally and not jointly,
to indemnify and hold harmless the Company, each of the Guarantors and each person, if any, who
controls the Company or any of the Guarantors within the meaning of Section 15 of the Securities
Act or Section 20 of the Exchange Act to the same extent as the indemnity set forth in paragraph
(a) above, but only with respect to any losses, claims, damages or liabilities that arise out of,
or are based upon, any untrue statement or omission or alleged untrue statement or omission made in
reliance upon and in conformity with any information relating to such Initial Purchaser furnished
to the Company in writing by such Initial Purchaser through the Representatives expressly for use
in the Preliminary Offering Memorandum and the Offering Memorandum (or any amendment or supplement
thereto), it being understood and agreed that the only such information consists of the following:
the third paragraph, the fifth and sixth sentences of the eighth paragraph and tenth paragraph
under the caption “Plan of distribution” set forth in the Offering Memorandum.

     (c) Notice and Procedures. If any suit, action, proceeding (including any governmental or
regulatory investigation), claim or demand shall be brought or asserted against any person in
respect of which indemnification may be sought pursuant to either paragraph (a) or (b) above, such
person (the “Indemnified Person”) shall promptly notify the person against whom such
indemnification may be sought (the “Indemnifying Person”) in writing; provided that the
failure to notify the Indemnifying Person shall not relieve it from any liability that it may have
under this Section 6 except to the extent that it has been materially prejudiced (through the
forfeiture of substantive rights or defenses) by such failure; and provided,
further, that the failure to notify the Indemnifying Person shall not relieve it from any
liability that it may have to an Indemnified Person otherwise than under this Section 6. If any
such proceeding shall be brought or asserted against an Indemnified Person and it shall have
notified the Indemnifying Person thereof, the Indemnifying Person shall be entitled to participate
therein and, to the extent that it wishes, jointly with any other similarly notified Indemnified
Person, to assume the defense thereof with counsel reasonably satisfactory to the Indemnified
Person. After notice the Indemnified Person to the Indemnified Person of its election to assume
the defense of such claim or action, the Indemnifying Person will not be liable to the Indemnified
Person under this Section for any legal or other expenses subsequently incurred by the Indemnified
Person in connection with the defense thereof other than reasonable costs of investigation;
provided however, that in any such proceeding, any Indemnified Person shall have the right to
retain its own counsel, but the fees and expenses of such counsel shall be at the expense of such
Indemnified Person unless (i) the Indemnifying Person and the Indemnified Person shall have
mutually agreed to the contrary; (ii) the Indemnifying Person has failed within a reasonable time
to retain counsel reasonably satisfactory to the Indemnified Person; (iii) the Indemnified Person
shall have reasonably concluded that

18

 

there may be legal defenses available to it that are different from or in addition to those
available to the Indemnifying Person; or (iv) the named parties in any such proceeding (including
any impleaded parties) include both the Indemnifying Person and the Indemnified Person and
representation of both parties by the same counsel would be inappropriate due to actual or
potential differing interests between them. It is understood and agreed that the Indemnifying
Person shall not, in connection with any proceeding or related proceeding in the same jurisdiction,
be liable for the fees and expenses of more than one separate firm (in addition to any local
counsel) for all Indemnified Persons, and that all such fees and expenses shall be reimbursed as
they are incurred. Any such separate firm for any Initial Purchaser, its affiliates, directors and
officers and any control persons of such Initial Purchaser shall be designated in writing by J.P.
Morgan Securities Inc. and any such separate firm for the Company, the Guarantors and any control
persons of the Company and the Guarantors shall be designated in writing by the Company. The
Indemnifying Person shall not be liable for any settlement of any proceeding effected without its
written consent, but if settled with such consent or if there be a final judgment for the
plaintiff, the Indemnifying Person agrees to indemnify each Indemnified Person from and against any
loss or liability by reason of such settlement or judgment. No Indemnifying Person shall, without
the written consent of the Indemnified Person, effect any settlement of any pending or threatened
proceeding in respect of which any Indemnified Person is or could have been a party and
indemnification could have been sought hereunder by such Indemnified Person, unless such settlement
(x) includes an unconditional release of such Indemnified Person, in form and substance reasonably
satisfactory to such Indemnified Person, from all liability on claims that are the subject matter
of such proceeding and (y) does not include any statement as to or any admission of fault,
culpability or a failure to act by or on behalf of any Indemnified Person.

     (d) Contribution. If the indemnification provided for in paragraphs (a) and (b) above is
unavailable to an Indemnified Person or insufficient in respect of any losses, claims, damages or
liabilities referred to therein, then each Indemnifying Person under such paragraph, in lieu of
indemnifying such Indemnified Person thereunder, shall contribute to the amount paid or payable by
such Indemnified Person as a result of such losses, claims, damages or liabilities (i) in such
proportion as is appropriate to reflect the relative benefits received by the Company and the
Guarantors on the one hand and the Initial Purchasers on the other from the offering of the
Securities or (ii) if the allocation provided by clause (i) is not permitted by applicable law, in
such proportion as is appropriate to reflect not only the relative benefits referred to in clause
(i) but also the relative fault of the Company and the Guarantors on the one hand and the Initial
Purchasers on the other in connection with the statements or omissions that resulted in such
losses, claims, damages or liabilities, as well as any other relevant equitable considerations.
The relative benefits received by the Company and the Guarantors on the one hand and the Initial
Purchasers on the other shall be deemed to be in the same respective proportions as the net
proceeds (before deducting expenses) received by the Company from the sale of the Securities and
the total discounts and commissions received by the Initial Purchasers in connection therewith, as
provided in this Agreement, bear to the aggregate offering price of the Securities. The relative
fault of the Company and the Guarantors on the one hand and the Initial Purchasers on the other
shall be determined by reference to, among other things, whether the untrue or alleged untrue
statement of a material fact or the omission or alleged omission to state a material fact relates
to information supplied by the Company or any Guarantor or by the Initial Purchasers and the
parties’ relative intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission.

     (e) Limitation on Liability. The Company, the Guarantors and the Initial Purchasers agree
that it would not be just and equitable if contribution pursuant to this Section 6 were determined
by pro rata allocation (even if the Initial Purchasers were treated as one entity
for such purpose) or by any other method of allocation that does not take account of the equitable
considerations referred to in paragraph (d) above. The amount paid or payable by an Indemnified
Person as a result of the losses, claims, damages

19

 

and liabilities referred to in paragraph (d) above shall be deemed to include, subject to the
limitations set forth above, any legal or other expenses incurred by such Indemnified Person in
connection with any such action or claim. Notwithstanding the provisions of this Section 6, in no
event shall an Initial Purchaser be required to contribute any amount in excess of the amount by
which the total discounts and commissions received by such Initial Purchaser with respect to the
offering of the Securities exceeds the amount of any damages that such Initial Purchaser has
otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or
alleged omission. No person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Securities Act) shall be entitled to contribution from any person who was not guilty
of such fraudulent misrepresentation. The Initial Purchasers’ obligations to contribute pursuant
to this Section 6 are several in proportion to their respective purchase obligations hereunder and
not joint.

     (f) Non-Exclusive Remedies. The remedies provided for in this Section 6 are not exclusive and
shall not limit any rights or remedies that may otherwise be available to any Indemnified Person at
law or in equity.

     7. Termination. This Agreement may be terminated in the absolute discretion of the
Representatives, by notice to the Company, if after the execution and delivery of this Agreement
and prior to the Closing Date (i) trading generally shall have been suspended or materially limited
on the New York Stock Exchange or the over-the-counter market; (ii) trading of any securities
issued or guaranteed by the Company or any of the Guarantors shall have been suspended on any
exchange or in any over-the-counter market; (iii) a general moratorium on commercial banking
activities shall have been declared by federal or New York State authorities; or (iv) there shall
have occurred any outbreak or escalation of hostilities or any change in financial markets or any
calamity or crisis, either within or outside the United States, that, in the reasonable judgment of
the Representatives, is material and adverse and makes it impracticable or inadvisable to proceed
with the offering, sale or delivery of the Securities on the terms and in the manner contemplated
by this Agreement and the Offering Memorandum.

     8. Defaulting Initial Purchaser. (a) If, on the Closing Date, any Initial Purchaser
defaults on its obligation to purchase the Securities that it has agreed to purchase hereunder, the
non-defaulting Initial Purchasers may in their discretion arrange for the purchase of such
Securities by other persons satisfactory to the Company on the terms contained in this Agreement.
If, within 36 hours after any such default by any Initial Purchaser, the non-defaulting Initial
Purchasers do not arrange for the purchase of such Securities, then the Company shall be entitled
to a further period of 36 hours within which to procure other persons reasonably satisfactory to
the non-defaulting Initial Purchasers to purchase such Securities on such terms. If other persons
become obligated or agree to purchase the Securities of a defaulting Initial Purchaser, either the
non-defaulting Initial Purchasers or the Company may postpone the Closing Date for up to five full
business days in order to effect any changes that in the opinion of counsel for the Company or
counsel for the Initial Purchasers may be necessary in the Offering Memorandum or in any other
document or arrangement, and the Company agrees to promptly prepare any amendment or supplement to
the Offering Memorandum that effects any such changes. As used in this Agreement, the term
“Initial Purchaser” includes, for all purposes of this Agreement unless the context otherwise
requires, any person not listed in Schedule 1 hereto that, pursuant to this Section 8, purchases
Securities that a defaulting Initial Purchaser agreed but failed to purchase.

     (b) If, after giving effect to any arrangements for the purchase of the Securities of a
defaulting Initial Purchaser or Initial Purchasers by the non-defaulting Initial Purchasers and the
Company as provided in paragraph (a) above, the aggregate principal amount of such Securities that
remains unpurchased does not exceed one-eleventh of the aggregate principal amount of all the
Securities, then the Company shall have the right to require each non-defaulting Initial Purchaser
to purchase the

20

 

principal amount of Securities that such Initial Purchaser agreed to purchase hereunder plus
such Initial Purchaser’s pro rata share (based on the principal amount of
Securities that such Initial Purchaser agreed to purchase hereunder in relation to the amounts of
Securities that the other non-defaulting Initial Purchaser has agreed to purchase hereunder) of the
Securities of such defaulting Initial Purchaser or Initial Purchasers for which such arrangements
have not been made.

     (c) If, after giving effect to any arrangements for the purchase of the Securities of a
defaulting Initial Purchaser or Initial Purchasers by the non-defaulting Initial Purchasers and the
Company as provided in paragraph (a) above, the aggregate principal amount of such Securities that
remains unpurchased exceeds one-eleventh of the aggregate principal amount of all the Securities,
or if the Company shall not exercise the right described in paragraph (b) above, then this
Agreement shall terminate without liability on the part of the non-defaulting Initial Purchasers.
Any termination of this Agreement pursuant to this Section 8 shall be without liability on the part
of the Company or the Guarantors, except that the Company and each of the Guarantors will continue
to be liable for the payment of expenses as set forth in Section 9 hereof and except that the
provisions of Section 6 hereof shall not terminate and shall remain in effect.

     (d) Nothing contained herein shall relieve a defaulting Initial Purchaser of any liability it
may have to the Company, the Guarantors or any non-defaulting Initial Purchaser for damages caused
by its default.

     9. Payment of Expenses. (a) Whether or not the transactions contemplated by this
Agreement are consummated or this Agreement is terminated, the Company and each of the Guarantors
jointly and severally agree to pay or cause to be paid all costs and expenses incident to the
performance of their respective obligations hereunder, including without limitation, (i) the costs
incident to the authorization, issuance, sale, preparation and delivery of the Securities and any
taxes payable in that connection; (ii) the costs incident to the preparation and printing of the
Preliminary Offering Memorandum and the Offering Memorandum (including any amendment or supplement
thereto) and the distribution thereof; (iii) the costs of reproducing and distributing each of the
Transaction Documents; (iv) the fees and expenses of the Company’s and the Guarantors’ counsel and
independent accountants; (v) the fees and expenses incurred in connection with the registration or
qualification and determination of eligibility for investment of the Securities under the laws of
such jurisdictions as the Representatives may designate and the preparation, printing and
distribution of a Blue Sky Memorandum (including the related fees and expenses of counsel for the
Initial Purchasers); (vi) any fees charged by rating agencies for rating the Securities; (vii) the
fees and expenses of the Trustee and any paying agent (including related fees and expenses of any
counsel to such parties); (viii) the fees and expenses of the Escrow Agent; (ix) all expenses and
application fees incurred in connection with the application for the inclusion of the Securities on
the PORTAL Market and the approval of the Securities for book-entry transfer by DTC; and (x) 50% of
the expense of any chartered aircraft jointly used in connection with the “road show” presentation
to potential investors.

     (b) If the Company for any reason, except with respect to any defaulting Initial Purchaser,
fails to tender the Securities for delivery to the Initial Purchasers by reason of any failure,
refusal or inability on the part of the Company to perform any agreement on its part to be
performed, or because any other condition of the obligations hereunder required to be fulfilled by
the Company or any of its subsidiaries is not fulfilled, (including but not limited to, termination
arising under Section 7(ii)), the Company and each of the Guarantors jointly and severally agrees
to reimburse the Initial Purchasers for all out-of-pocket costs and expenses (including the fees
and expenses of their counsel) reasonably incurred by the Initial Purchasers in connection with
this Agreement and the offering contemplated hereby.

21

 

     10. Persons Entitled to Benefit of Agreement. This Agreement shall inure to the
benefit of and be binding upon the parties hereto and their respective successors and any
controlling persons referred to herein, and the affiliates, officers and directors of each Initial
Purchaser referred to in Section 6 hereof. Nothing in this Agreement is intended or shall be
construed to give any other person any legal or equitable right, remedy or claim under or in
respect of this Agreement or any provision contained herein. No purchaser of Securities from any
Initial Purchaser shall be deemed to be a successor merely by reason of such purchase.

     11. Survival. The respective indemnities, rights of contribution, representations,
warranties and agreements of the Company, the Guarantors and the Initial Purchasers contained in
this Agreement or made by or on behalf of the Company, the Guarantors or the Initial Purchasers
pursuant to this Agreement or any certificate delivered pursuant hereto shall survive the delivery
of and payment for the Securities and shall remain in full force and effect, regardless of any
termination of this Agreement or any investigation made by or on behalf of the Company, the
Guarantors or the Initial Purchasers.

     12. Certain Defined Terms. For purposes of this Agreement, (a) except where otherwise
expressly provided, the term “affiliate” has the meaning set forth in Rule 405 under the Securities
Act; (b) the term “business day” means any day other than a day on which banks are permitted or
required to be closed in New York City; (c) the term “Exchange Act” means the Securities Exchange
Act of 1934, as amended; (d) the term “subsidiary” has the meaning set forth in Rule 405 under the
Securities Act; and the term “significant subsidiary” has the meaning set forth in Rule 1-02 of
Regulation S-X under the Exchange Act.

     13. Miscellaneous. (a) Authority of the Representatives. Any action by the Initial
Purchasers hereunder may be taken by J.P. Morgan Securities Inc. and Lehman Brothers Inc. on behalf
of the Initial Purchasers, and any such action taken by J.P. Morgan Securities Inc. and Lehman
Brothers Inc. shall be binding upon the Initial Purchasers.

     (b) Notices. All notices and other communications hereunder shall be in writing and shall be
deemed to have been duly given if mailed or transmitted and confirmed by any standard form of
telecommunication. Notices to the Initial Purchasers shall be given to the Representatives c/o
J.P. Morgan Securities Inc., 270 Park Avenue, New York, New York 10017 (fax: (212) 270-1063);
Attention: Ken Lang and Lehman Brothers Inc., 745 Seventh Avenue, New York, New York 10019 (fax:
(212) 526-___); Attention: ___. Notices to the Company and the Guarantors shall be
given to them at Standard Aero Holdings, Inc., 500-1780 Wellington Avenue, Winnipeg, Manitoba,
Canada, (fax: (204) 784-9647); Attention: Andrew Shinn with a copy to Ian Blumenstein at Riverside
Center, 275 Grove St., 4th Floor, Newton, MA 02466 (fax: (617) 663-5319). All such
notices and other communications shall be deemed to have been given and received (i) in the case of
personal delivery or delivery by telecopy, on the date of such delivery if delivered by business
hours on a business day, (ii) in the case of delivery of by nationally-recognized, overnight
carrier, on the business day following dispatch and (iii) in the case of mailing, on the third
business day following such mailing. The Company, the Guarantors and the Representatives may, by
written notice to the others, designate additional or different addresses for subsequent notices or
communications. The Company shall be entitled to act and rely upon any request, consent, notice or
agreement given or made on behalf of the Initial Purchasers by the Representatives.

     (c) Governing Law. This Agreement shall be governed by and construed in accordance with the
laws of the State of New York.

22

 

     (d) Counterparts. This Agreement may be signed in counterparts (which may include
counterparts delivered by any standard form of telecommunication), each of which shall be an
original and all of which together shall constitute one and the same instrument.

     (e) Amendments or Waivers. No amendment or waiver of any provision of this Agreement, nor any
consent or approval to any departure therefrom, shall in any event be effective unless the same
shall be in writing and signed by the parties hereto.

     (f) Headings. The headings herein are included for convenience of reference only and are not
intended to be part of, or to affect the meaning or interpretation of, this Agreement.

[continued on next page]

23

 

     If the foregoing is in accordance with your understanding, please indicate your acceptance of
this Agreement by signing in the space provided below.

	 	 	 	 	 	 	 	 	 
	 	 	 	 	Very truly yours,	 	 
	 	 	 	 	STANDARD AERO HOLDINGS, INC.	 	 
	 	 	 	 	By
	 	  /s/ Bradley Bertouille

Name: Bradley Bertouille

Title: Senior Vice President of Finance,

     Treasurer and Secretary
	 	 
	Accepted: August 17, 2004	 	 	 	 	 	 
	J.P. MORGAN SECURITIES INC.	 	 	 	 	 	 
	For itself and on behalf of the

  several Initial Purchasers listed

  in Schedule 1 hereto.	 	 	 	 	 	 
	By	 	
    [illegible]                               

        Authorized Signatory	 	 	 	 	 	 

 

 

Schedule 1

	 	 	 	 	 
	Initial Purchaser	 	Principal Amount	 
	 	 	 	 
	J.P. Morgan Securities Inc.
	 	$	100,00,000	 
	 
	 	 	 	 
	Lehman Brothers Inc.
	 	 	70,000,000	 
	 
	 	 	 	 
	Credit Suisse First Boston LLC
	 	 	30,000,000	 
	 
	 	 	 
	 
	 	 	 	 
	Total
	 	$	200,000,000	 

 

 

Schedule 2

Subsidiaries

	 	 	 	 	 	 
	 
	 	Name	 	 	Jurisdiction of Incorporation	 
	 	Dunlop Standard Aerospace (US) Inc.

	 	 	Delaware	 
	 	Dunlop Standard Aerospace (US) Legal Inc.

	 	 	Delaware	 
	 	Standard Aero, Inc.

	 	 	Delaware	 
	 	Dunlop Aerospace Parts, Inc.

	 	 	Delaware	 
	 	Standard Aero (San Antonio) Inc.

	 	 	Delaware	 
	 	Standard Aero (Alliance) Inc.

	 	 	Delaware	 
	 	Standard Aero Canada, Inc.

	 	 	Delaware	 
	 	3091781 Nova Scotia Company

	 	 	Nova Scotia	 
	 	3091782 Nova Scotia Company

	 	 	Nova Scotia	 
	 	3091783 Nova Scotia Company

	 	 	Nova Scotia	 
	 	6269044 Canada Inc.

	 	 	Canada	 
	 	Standard Aero Limited

	 	 	Canada	 
	 	Not FM Canada Inc.

	 	 	Canada	 
	 	Dunlop Standard Aerospace (Nederland) BV

	 	 	The Netherlands	 
	 	Standard Aero BV

	 	 	The Netherlands	 
	 	Standard Aero de Mexico S.A. de CV

	 	 	Mexico City, State of Mexico	 
	 	Standard Aero (Asia) Pte Limited

	 	 	Singapore	 
	 	Standard Aero (Australia) Pty Limited

	 	 	Australia	 
	 

 

 

Schedule 3

Subsidiary Guarantors

	 	 	 	 	 	 
	 
	 	Name	 	 	Jurisdiction of Incorporation	 
	 	Dunlop Standard Aerospace (US) Inc.

	 	 	Delaware	 
	 	Dunlop Standard Aerospace (US) Legal Inc.

	 	 	Delaware	 
	 	Standard Aero, Inc.

	 	 	Delaware	 
	 	Dunlop Aerospace Parts, Inc.

	 	 	Delaware	 
	 	Standard Aero (San Antonio) Inc.

	 	 	Delaware	 
	 	Standard Aero (Alliance) Inc.

	 	 	Delaware	 
	 	Standard Aero Canada, Inc.

	 	 	Delaware	 
	 	3091781 Nova Scotia Company

	 	 	Nova Scotia	 
	 	3091782 Nova Scotia Company

	 	 	Nova Scotia	 
	 	3091783 Nova Scotia Company

	 	 	Nova Scotia	 
	 	Standard Aero Limited

	 	 	Canada	 
	 	Not FM Canada Inc.

	 	 	Canada	 
	 	Dunlop Standard Aerospace (Nederland) BV

	 	 	The Netherlands	 
	 	Standard Aero BV

	 	 	The Netherlands	 
	 

 

 

Exhibit A

FORM OF JOINDER AGREEMENT 

J.P. Morgan Securities Inc.

Lehman Brothers Inc.
  As
Representatives of the
  several
Initial Purchasers listed
  in
Schedule 1 of the
  Purchase
Agreement (as defined below)

c/o J.P. Morgan Securities Inc.

270 Park Avenue

New York, New York 10017

Ladies and Gentlemen:

     Reference is made to the Purchase Agreement (the “Purchase Agreement”) dated August 17, 2004,
initially among Standard Aero Holdings, Inc., a Delaware corporation (the “Company”), and the
several parties named in Schedule 1 thereto (the “Initial Purchasers”), concerning the purchase of
the Securities (as defined in the Purchase Agreement) from the Company by the Initial Purchasers.
Capitalized terms used herein but not defined herein shall have the meanings assigned to such terms
in the Purchase Agreement.

     The Company and each of the Guarantors listed on Schedule A hereto agree that this letter
agreement is being executed and delivered in connection with the issue and sale of the Securities
pursuant to the Purchase Agreement and to induce the Initial Purchasers to purchase the Securities
thereunder and is being executed concurrently with the consummation of the Acquisition.

	 	(i)  	Joinder. Each of the parties hereto hereby
agrees to be bound by the terms, conditions and other provisions of the
Purchase Agreement with all attendant rights, duties and obligations stated
therein, on a joint and several basis with the parties hereto and thereto,
with the same force and effect as if originally named as a Guarantor
therein and as if such party executed the Purchase Agreement on the date
thereof.
	 
	 	(ii)  	GOVERNING LAW. THIS LETTER AGREEMENT SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
YORK.
	 
	 	(iii)  	Counterparts. This letter agreement may be
signed in counterparts (which may include counterparts delivered by any
standard form of telecommunication), each of which shall be an original and
all of which together shall constitute one and the same instrument.
	 
	 	(iv)  	Amendments. No amendment or waiver of any
provision of this Agreement, nor any consent or approval to any departure
therefrom, shall in any event be effective unless the same shall be in
writing and signed by the parties hereto.

 

 

	 	(v)  	Headings. The headings herein are included for
convenience of reference only and are not intended to be part of, or to
affect the meaning or interpretation of, this Agreement.

2

 

     If the foregoing is in accordance with your understanding of our agreement, please indicate
your acceptance of this letter agreement by signing in the space provided below, whereupon this
letter agreement will become a binding agreement between the Guarantors party hereto and the
several Initial Purchasers in accordance with its terms.

	 	 	 	 	 	 	 
	 	 	STANDARD AERO HOLDINGS, INC.	 	 
	 	 	 	 	 	 	 
	 	 	
By:
	 	 

Name:
	 	 
	 	 	 	 	Title:	 	 
	 	 	DUNLOP STANDARD AEROSPACE (US) INC.	 	 
	 	 	 	 	 	 	 
	 	 	
By:
	 	 

Name:
	 	 
	 	 	 	 	Title:	 	 
	 	 	DUNLOP STANDARD AEROSPACE (US) LEGAL INC.	 	 
	 	 	 	 	 	 	 
	 	 	
By:
	 	 

Name:
	 	 
	 	 	 	 	Title:	 	 
	 	 	STANDARD AERO, INC.	 	 
	 	 	 	 	 	 	 
	 	 	
By:
	 	 

Name:
	 	 
	 	 	 	 	Title:	 	 
	 	 	DUNLOP AEROSPACE PARTS, INC.	 	 
	 	 	 	 	 	 	 
	 	 	
By:
	 	 

Name:
	 	 
	 	 	 	 	Title:	 	 
	 	 	STANDARD AERO (SAN ANTONIO) INC.	 	 
	 	 	 	 	 	 	 
	 	 	
By:
	 	 

Name:
	 	 
	 	 	 	 	Title:	 	 
	 	 	STANDARD AERO (ALLIANCE) INC.	 	 

3

 

	 	 	 	 	 	 	 
	 	 	
By:
	 	 

Name:
	 	 
	 	 	 	 	Title:	 	 
	 	 	STANDARD AERO CANADA, INC.	 	 
	 	 	 	 	 	 	 
	 	 	
By:
	 	 

Name:
	 	 
	 	 	 	 	Title:	 	 
	 	 	3091781 NOVA SCOTIA COMPANY	 	 
	 	 	 	 	 	 	 
	 	 	
By:
	 	 

Name:
	 	 
	 	 	 	 	Title:	 	 
	 	 	3091782 NOVA SCOTIA COMPANY	 	 
	 	 	 	 	 	 	 
	 	 	
By:
	 	 

Name:
	 	 
	 	 	 	 	Title:	 	 
	 	 	3091783 NOVA SCOTIA COMPANY	 	 
	 	 	 	 	 	 	 
	 	 	
By:
	 	 

Name:
	 	 
	 	 	 	 	Title:	 	 
	 	 	STANDARD AERO LIMITED	 	 
	 	 	 	 	 	 	 
	 	 	
By:
	 	 

Name:
	 	 
	 	 	 	 	Title:	 	 
	 	 	NOT FM CANADA INC.	 	 
	 	 	 	 	 	 	 
	 	 	
By:
	 	 

Name:
	 	 
	 	 	 	 	Title:	 	 

4

 

	 	 	 	 	 	 	 
	 	 	DUNLOP STANDARD AEROSPACE

(NEDERLAND) BV	 	 
	 	 	 	 	 	 	 
	 	 	
By:
	 	 

Name:
	 	 
	 	 	 	 	Title:	 	 
	 	 	STANDARD AERO BV	 	 
	 	 	 	 	 	 	 
	 	 	
By:
	 	 

Name:
	 	 
	 	 	 	 	Title:	 	 

5

 

SCHEDULE A TO THE

JOINDER AGREEMENT

LIST OF GUARANTORS

Dunlop Standard Aerospace (US) Inc.

Dunlop Standard Aerospace (US) Legal Inc.

Standard Aero, Inc.

Dunlop Aerospace Parts, Inc.

Standard Aero (San Antonio) Inc.

Standard Aero (Alliance) Inc.

Standard Aero Canada, Inc.

3091781 Nova Scotia Company

3091782 Nova Scotia Company

3091783 Nova Scotia Company

Standard Aero Limited

Not FM Canada Inc.

Dunlop Standard Aerospace (Nederland) BV

Standard Aero BV

 

 

Exhibit B-1

[Form of Registration Rights Agreement]

 

 

Exhibit B-2

[Form of Joinder to Registration Rights Agreement]

 

 

ANNEX A

Restrictions on Offers and Sales Outside the United States

     In connection with offers and sales of Securities outside the United States:

     (a) Each Initial Purchaser acknowledges that the Securities have not been registered under the
Securities Act and may not be offered or sold within the United States or to, or for the account or
benefit of, U.S. persons except pursuant to an exemption from, or in transactions not subject to,
the registration requirements of the Securities Act.

     (b) Each Initial Purchaser, severally and not jointly, represents, warrants and agrees that:

     (i) Such Initial Purchaser has offered and sold the Securities, and will offer and sell
the Securities, (A) as part of the Initial Distribution at any time and (B) otherwise until
40 days after the later of the commencement of the offering of the Securities and the
Closing Date, only in accordance with Regulation S under the Securities Act (“Regulation S”)
or in accordance with Section 1(b)(iii)(A) of this Agreement or any other available
exemption from registration under the Securities Act.

     (ii) None of such Initial Purchaser or any of its affiliates or any other person acting
on its or their behalf has engaged or will engage in any directed selling efforts with
respect to the Securities, and all such persons have complied and will comply with the
offering restrictions requirement of Regulation S.

     (iii) At or prior to the confirmation of sale of any Securities sold in reliance on
Regulation S, such Initial Purchaser will have sent to each distributor, dealer or other
person receiving a selling concession, fee or other remuneration that purchase Securities
from it during the distribution compliance period a confirmation or notice to substantially
the following effect:

“The Securities covered hereby have not been registered under the U.S. Securities
Act of 1933, as amended (the “Securities Act”), and may not be offered or sold
within the United States or to, or for the account or benefit of, U.S. persons (i)
as part of their distribution at any time or (ii) otherwise until 40 days after the
later of the commencement of the offering of the Securities and the date of original
issuance of the Securities, except in accordance with Regulation S or Rule 144A or
any other available exemption from registration under the Securities Act. Terms
used above have the meanings given to them by Regulation S.”

     (iv) Such Initial Purchaser has not entered and will not enter into any contractual
arrangement with any distributor with respect to the distribution of the Securities, except
with its affiliates or with the prior written consent of the Company.

Terms used in paragraph (a) and this paragraph (b) and not otherwise defined in this Agreement have
the meanings given to them by Regulation S.

     (c) Each Initial Purchaser, severally and not jointly, represents, warrants and agrees that:

     (i) it has not offered or sold and, prior to the date six months after the Closing
Date, will not offer or sell any Securities to persons in the United Kingdom except to
persons whose

1

 

ordinary activities involve them in acquiring, holding, managing or disposing of
investments (as principal or agent) for the purposes of their businesses or otherwise in
circumstances that have not resulted and will not result in an offer to the public in the
United Kingdom within the meaning of the United Kingdom Public Offers of Securities
Regulations 1995 (as amended);

     (ii) it has only communicated or caused to be communicated and will only communicate or
cause to be communicated any invitation or inducement to engage in investment activity
(within the meaning of Section 21 of the United Kingdom Financial Services and Markets Act
2000 (the “FSMA”)) received by it in connection with the issue or sale of any Securities in
circumstances in which Section 21(1) of the FSMA does not apply to the Company or the
Guarantors; and

     (iii) it has complied and will comply with all applicable provisions of the FSMA with
respect to anything done by it in relation to the Securities in, from or otherwise involving
the United Kingdom.

     (d) Each Initial Purchaser acknowledges that no action has been or will be taken by the
Company that would permit a public offering of the Securities, or possession or distribution of the
Preliminary Offering Memorandum, the Offering Memorandum or any other offering or publicity
material relating to the Securities, in any country or jurisdiction where action for that purpose
is required.

2

 

Annex B-1

STANDARD AERO HOLDINGS, INC.

OFFICERS’ CERTIFICATE PURSUANT TO THE PURCHASE AGREEMENT

August [_], 2004

     We, ___and ___, the duly appointed [Chief Executive Officer] and
[President] of Standard Aero Holdings, Inc., a Delaware corporation (the “Company”), pursuant to
Section 5(d) of the Purchase Agreement, dated August ___, 2004 (the “Purchase Agreement”), among the
Company and the purchasers named therein (the “Initial Purchasers”), HEREBY CERTIFY, on behalf of
the Company, that, as of the date hereof and to the best of our knowledge after reasonable
investigation:

     1. Each of the respective signers of this certificate has carefully examined the
final offering memorandum of the Company, dated August ___, 2004 (the “Offering Memorandum”); in his
opinion, the Offering Memorandum, as of its date, did not include any untrue statement of a
material fact and did not omit to state a material fact required to be stated therein or necessary
in order to make the statements therein, in light of the circumstances under which they were made,
not misleading, and since the date of the Offering Memorandum, no event has occurred which should
have been set forth in a supplement or amendment to the Offering Memorandum so that the Offering
Memorandum (as so amended or supplemented) would not include any untrue statement of a material
fact and would not omit to state a material fact required to be stated therein or necessary in
order to make the statements therein, in light of the circumstances under which they were made, not
misleading;

     2. The representations and warranties of the Company contained in the Purchase
Agreement are true and correct in all material respects on and as of the date hereof with the same
effect as if made on the date hereof;

     3. The Company has complied with all agreements and satisfied all conditions on each
of their parts to be performed or satisfied under the Purchase Agreement on or prior to the Closing
Date;

     4. Except as described in the Offering Memorandum, including the description of the
use of all net proceeds of this offering together with the initial borrowings under the new credit
facility, subsequent to the execution and delivery of the Purchase Agreement on August 17, 2004,
(i) there has not been any change in the capital stock or long-term debt of the Company, or any
dividend or distribution of any kind declared, set aside for payment, paid or made by the Company
on any class of capital stock, or any material adverse change, or any development involving a
prospective material adverse change, in or affecting the business, properties, financial position,
or results of operations of the Company and its subsidiaries, taken as a whole after giving effect
to the consummation of the Acquisition; (ii) neither the Company nor the Acquired Business has
entered into or currently intends to enter into any transaction or agreement that is material to
the Company or the Acquired Business taken as a whole or incurred any liability or obligation,
direct or contingent, that is material to the Company or the Acquired Business taken as a whole;
and (iii) neither the Company nor the Acquired Business has sustained any material loss or
interference with its business from fire, explosion, flood or other calamity, whether or not
covered by insurance, or from any labor disturbance or dispute or any action, order or decree of
any court or arbitrator or governmental or regulatory authority, except in each case as otherwise
disclosed in the Offering Memorandum.

     5. Subsequent to the execution and delivery of the Purchase Agreement on August 17,
2004, (i) no downgrading has occurred in the rating accorded the Securities or any other debt

1

 

securities or preferred stock issued or guaranteed by the Company by any “nationally
recognized statistical rating organization”, as such term is defined by the Commission for purposes
of Rule 436(g)(2) under the Securities Act; and (ii) no such organization has publicly announced
that it has under surveillance or review, or has changed its outlook with respect to, its rating of
the Securities or of any other debt securities or preferred stock issued or guaranteed by the
Company (other than an announcement with positive implications of a possible upgrading).

     6. The undersigned is duly authorized to deliver this certificate and is familiar
with the financial statements and financial affairs of the Company, the Acquired Business, the
offering and sale of the Notes and the use of proceeds from the sale of the Notes as set forth in
the Offering Memorandum dated August 17, 2004 of the Company (the “Offering Memorandum”).

     7. Latham & Watkins LLP and Simpson Thacher & Bartlett LLP are entitled to rely on
this certificate in connection with the opinions that such firms are rendering pursuant to clauses
(g) and (h) of Section 5, respectively, of the Purchase Agreement.

2

 

     IN WITNESS WHEREOF, we have hereunto signed our names as of the ___day of August, 2004.

	 	 	 	 	 	 	 
	 	 	STANDARD AERO HOLDINGS, INC.	 	 
	 	 	 	 	 	 	 
	 	 	
By
	 	 

  Name:

  Title:
	 	 
	 	 	
By
	 	 

  Name:

  Title:	 	 

3

 

Annex B-2

[Insert names of SUBSIDIARY GUARANTORS]

OFFICER’S CERTIFICATE PURSUANT TO

THE PURCHASE AGREEMENT

August [_], 2004

     I, [                     ], an executive officer of each of the guarantors listed in
Schedule X attached hereto (each, a “Subsidiary Guarantor”), pursuant to Section 5(e) of
the Purchase Agreement, dated August ___, 2004 (the “Purchase Agreement”), among Standard Aero
Holdings, Inc. (the “Company”), the subsidiary guarantors parties thereto (after giving effect to
the Joinder Agreement (as defined therein)) and the purchasers named therein (the “Initial
Purchasers”) HEREBY CERTIFY, on behalf of each Subsidiary Guarantor, that, as of the date hereof
and to the best of my knowledge after reasonable investigation:

     1. The representations and warranties of each Subsidiary Guarantor contained in the
Purchase Agreement (after giving effect to the Joinder Agreement (as defined therein)) are true and
correct with the same force and effect as if originally named as a Subsidiary Guarantor therein and
as if such party executed the Purchase Agreement on the date thereof on and as of the date hereof
with the same effect as if made on the date hereof;

     2. Each Subsidiary Guarantor has complied with all agreements and satisfied in all
material respects all conditions on its part to be performed or satisfied under the Purchase
Agreement on or prior to the consummation of the Acquisition;

     3. (a) Latham & Watkins LLP, (b) Simpson Thacher & Bartlett LLP and (c) any other
legal counsel acting on behalf of each Subsidiary Guarantor are entitled to rely on this
certificate in connection with the opinions that such firms are rendering pursuant to Sections 5(g)
and 5(h), respectively, of the Purchase Agreement.

[continued on next page]

1

 

     IN WITNESS WHEREOF, I have hereunto signed my name as of the ___day of August, 2004.

	 	 	 	 	 	 	 
	 	 	[INSERT NAMES OF SUBSIDIARY GUARANTORS]	 	 
	 	 	 	 	 	 	 
	 	 	
By
	 	 

  Name:

  Title:
	 	 

2

 

Annex B-3

[FORM OF MANAGEMENT COMFORT LETTER]

Standard Aero Management Comfort Letter

			
	J.P. Morgan Securities Inc.
	 	August ___, 2004

Lehman Brothers Inc.

Credit Suisse First Boston

c/o J.P. Morgan Securities Inc.

270 Park Avenue

New York, New York 10017

Ladies and Gentlemen:

          Reference is made to the offering by Standard Aero Holdings, Inc., a Delaware corporation (the
“Issuer”) of 8 1/4% Senior Subordinated Notes due 2014, pursuant to the terms of the Purchase
Agreement, dated August 20, 2004 (the “Purchase Agreement”) among the Issuer and the Initial
Purchasers named therein. Capitalized terms used but not defined herein shall have the meanings
assigned to such terms in the Purchase Agreement. Each of the undersigned, David Shaw and Bradley
Bertouille, duly appointed Chief Executive Officer and Senior Vice-President, Finance and
Administration of the Issuer, pursuant to Section 5(d) of the Purchase Agreement, hereby certifies
on behalf of the Issuer that, as of the date hereof:

          1. The circled information (the “Information”) from the Issuer’s Offering Memorandum dated
August 20, 2004 (the “Offering Memorandum”), and attached hereto as Annex A is derived from the
books and records of the ERO division of Dunlop Standard Aerospace Group Limited (the “Company”)
and the Information is correct and accurate in all material respects.

          2. I have discussed the adjustments necessary to convert the audited financial statements of
the Company from U.K. generally accepted accounting principles to accounting principles generally
accepted in the United States with PricewaterhouseCoopers LLP.

          3. I discussed the basis of my determination of the pro forma adjustments contained in the
section of the Offering Memorandum entitled “Unaudited pro forma combined financial data” with
PricewaterhouseCoopers LLP.

          4. For the period from July 1, 2004 to August 17, 2004, there were no decreases, as compared
with the corresponding period in the preceding year, in total combined revenues, income from
operations or EBITDA, except in all instances that the Offering Memorandum discloses have occurred
or may occur.

1

 

	 	 	 	 	 	 	 
	 	 	Dated as of this __ day of August, 2004.
	 
	 	 	 	 	 	 
	 	 	STANDARD AERO HOLDINGS, INC.
	 
	 	 	 	 	 	 
	

	 	By:	 	 	 	 
	

	 	 	 	 	 	 
	

	 	 	 	Name: David Shaw	 	 
	

	 	 	 	Title: Chief Executive Officer	 	 
	

	 	By:	 	 	 	 
	

	 	 	 	 	 	 
	

	 	 	 	Name: Bradley Bertouille	 	 
	

	 	 	 	Title: Senior Vice-President,	 	 
	

	 	 	 	Finance and Administration	 	 

2

 

Annex C-1

STANDARD AERO HOLDINGS, INC.

SECRETARY’S CERTIFICATE PURSUANT TO THE PURCHASE AGREEMENT

August [_], 2004

          The undersigned, the duly elected or appointed Secretary of Standard Aero Holdings, Inc., a
Delaware corporation (the “Company”), DOES HEREBY CERTIFY on behalf of the Company that:

          (i) Attached hereto as Exhibit A is a true, correct and complete copy of the certificate of
incorporation of the Company (the “Charter”). Since                     , there have been no amendments to
the Charter and other than in connection with the Acquisition (as defined in the Offering
Memorandum (as defined herein)), no proceeding has been commenced for the merger, consolidation,
dissolution or liquidation of the Company or the sale of all or substantially all of its assets and
there has not been commenced or threatened any action or proceeding threatening the Company’s
existence or which would result in the forfeiture of the Charter. In addition, the Company has
duly and timely paid all franchise taxes and other fees required to be paid to, and has duly and
timely filed all annual franchise tax reports with, the Secretary of State of the State of Delaware
pursuant to the Delaware General Corporation Law.

          (ii) Attached hereto as Exhibit B is a true, correct and complete copy of the By-laws of the
Company as in effect on                      and at all times through and including the date hereof.

          
(iii) Attached hereto as Exhibits C-1 and C-2 are true, correct and complete copies,
respectively, of (a) the resolutions dated                      by the Board of Directors of the Company
(the “Board of Directors”) and (b) the resolutions dated                      by the Pricing Committee of
the Board of Directors authorizing the issuance, offer and sale of up to $200,000,000 aggregate
principal amount of 81/4% Senior Subordinated Notes due 2014 (the “Notes”) and related matters,
including, without limitation, the authorization of (a) the execution and issuance of the Notes;
(b) the qualification of the Notes for offer and sale under state securities laws or the perfection
of an exemption therefrom; (c) the sale of the Notes pursuant to the Purchase Agreement dated
August 17, 2004 (the “Purchase Agreement”) by and among the Company, (after giving effect to the
Joinder Agreement) the guarantors party thereto (the “Guarantors”) and the purchasers named therein
(the “Initial Purchasers”), and all other transactions with respect to the Notes contemplated
thereby; (d) the execution of the Registration Rights Agreement dated as of August 20, 2004 (the
“Registration Rights Agreement”) by and among the Company and the Initial Purchasers, and all other
transactions with respect to the Notes contemplated thereby; (e) the execution of the Escrow
Agreement dated as of August 20, 2004 (the “Escrow Agreement) by and among the Company, the Initial
Purchasers and the escrow agent; (f) the execution of the Indenture dated as of August ___, 2004
(the “Indenture”) by and between the Company and Wells Fargo Bank, National Association and all
other transactions with respect to the Notes contemplated thereby; (g) the formation of the Pricing
Committee; (h) the preparation of a preliminary offering memorandum dated August 9, 2004 (the
“Preliminary Offering Memorandum”); and (i) the preparation of a final offering memorandum dated
August 17, 2004 (the “Offering Memorandum”). The aforementioned resolutions have not been amended,
rescinded or modified since their adoption and execution, remain in full force and effect as of the
date hereof and represent the only resolutions adopted or action taken by, or on behalf of, the
Board of Directors or any committee thereof relating to the matters described above.

1

 

          (iv) Each of the Indenture dated as of August 20, 2004 (the “Indenture”) between the Company
and Wells Fargo Bank, National Association, as trustee (the “Trustee”), the Purchase Agreement
dated August 17, 2004 (the “Purchase Agreement”) among the Company, the Guarantors and the initial
purchasers listed therein (the “Initial Purchasers”), the Escrow Agreement dated August 20, 2004
(the “Escrow Agreement”) among the Company, the Initial Purchasers and the escrow agent, and the
Registration Rights Agreement dated August 20, 2004 (the “Registration Rights Agreement”) among the
Company and the Initial Purchasers, as executed and delivered by the Company, is substantially in
the form approved by the Board of the Company or the Pricing Committee thereof pursuant to the
resolutions referred to in paragraph (iii) above, and have been duly authorized, executed and
delivered by the Company.

          (v) Attached hereto as Exhibit D are true, correct and complete copies of the executed global
notes representing the Notes, in the form approved by the Board of Directors or the Pricing
Committee thereto.

          (vi) Each person who, as a director or officer of the Company or an attorney-in-fact of such
director or officer, signed (a) the Purchase Agreement, (b) the Escrow Agreement, (c) the
Registration Rights Agreement, (d) the Indenture, (e) the Notes and (f) the other documents or
certificates delivered by, as of or on the date hereof in connection with the closing of the sale
of the 81/4% Senior Subordinated Notes due 2014, including to the Trustee, was duly elected and
qualified as an officer or director or was duly appointed as an attorney-in-fact of such duly
elected and qualified director or officer, as the case may be, of the Company and held the office
or offices indicated thereon on the date of, and was duly authorized to take such action, and each
signature of such signing officer is his or her genuine signature.

          (vii) The minute books of the meetings and actions of the Board of Directors, all committees
thereof and the stockholders of the Company which have been made available to Latham & Watkins LLP
and Simpson Thacher and Bartlett LLP are the original minute books of the Company or exact copies
thereof, and contain all minutes of such meetings and actions from through the date on which Latham
& Watkins LLP and Simpson Thacher & Bartlett LLP last reviewed such books other than such meetings
for which no minutes are available, in which case drafts of minutes, notes as to proceedings at
such meetings and agendas have been made available to such counsel; and

          (viii) Latham & Watkins LLP and Simpson Thacher & Bartlett LLP are entitled to rely on this
certificate in connection with the opinions that such firms are rendering pursuant to clauses (g)
and (h) of Section 5, respectively, of the Purchase Agreement.

[continued on next page]

2

 

     IN WITNESS WHEREOF, the undersigned has executed this certificate as of the date first above
written.

    	 	 	 	 	 	 	 
	 	 	STANDARD AERO HOLDINGS, INC.
	 
	 	 	 	 	 	 
	 
	 	By	 	 	 
	 
	 	 	 	 	 
	 
	 	 	Name:	 	 	 
	 
	 	 	 	 	 	 
	 
	 	 	Title: 	Secretary	 	 

          The undersigned, the duly qualified [insert title] of the Company, DOES HEREBY CERTIFY that
[insert name of Secretary] is the duly elected or appointed Secretary of the Company, and that the
signature set forth above [his][her] name is [his][her] true signature.

          IN WITNESS WHEREOF, the undersigned has executed this certificate as of the date first written
above.

    	 	 	 	 	 	 	 
	 
	 	 	 	 	 
	 
	 	Name:	 	 	 	 
	 
	 	 	 	 	 	 
	 
	 	Title:	 	 	 	 
	 
	 	 	 	 	 	 

3

 

Annex C-2

[Insert names of SUBSIDIARY GUARANTORS]

SECRETARY’S CERTIFICATE PURSUANT TO

THE PURCHASE AGREEMENT

August [_], 2004

     Pursuant to Section 5(e) of the Purchase Agreement, dated as of August 17, 2004 (the “Purchase
Agreement”), among the Standard Aero Holdings, Inc. (the “Company”), and after giving effect to the
Joinder Agreement, the subsidiary guarantors parties thereto and the purchasers named therein, the
undersigned, the duly elected or appointed Secretary of each of the guarantors listed in
Schedule Y attached hereto (each, a “Subsidiary Guarantor”) DOES HEREBY CERTIFIES on behalf
of each Subsidiary Guarantee that:

     (i) Attached hereto as Exhibit A is a true, correct and complete copy of the
Certificate of Incorporation or Certificate of Formation, as applicable (each, a “Charter”), of
each Subsidiary Guarantor as in effect on the date hereof. Since the date that each such Charter
was certified by the Secretary of State of the States of ___, there have been
no amendments to such Charter, no proceeding has been commenced for the merger, consolidation,
dissolution or liquidation of such Subsidiary Guarantor or the sale of all or substantially all of
such Subsidiary Guarantor’s assets and there has not been commenced or threatened any action or
proceeding threatening such Subsidiary Guarantor’s existence or which would result in the
forfeiture of the Charter. In addition, each Subsidiary Guarantor has duly paid all franchise and
business taxes and other fees to, and has duly filed all annual corporation franchise tax returns
with the appropriate state agencies pursuant to applicable state law;

     (ii) Attached hereto as Exhibit B is a true, correct and complete copy of the By-laws
or Operating Agreement of each Subsidiary Guarantor as in effect on the date hereof;

     (iii) Attached hereto as Exhibit C is a true, correct and complete copy of resolutions
dated ___by the Board of Directors of each Subsidiary Guarantor pertaining to the
guarantee by each Subsidiary Guarantor of an offering of 81/4% Senior Subordinated Notes due 2014 to
be issued by Standard Aero Holdings, Inc. in a transaction exempt from registration under the
Securities Act of 1933, as amended, and related matters. The aforementioned resolutions have not
been amended, rescinded or modified since their adoption and execution, remain in full force and
effect as of the date hereof and represent the only resolutions adopted or action taken by, or on
behalf of, the Subsidiary Guarantor relating to the matters described above;

     (iv) Each of (a) the Indenture, dated as of August 20, 2004 (the “Indenture”) as supplemented
by the Supplemental Indenture dated      , 2004 among the Company, the guarantors
listed therein (the “Guarantors”) and Wells Fargo Bank, National Association, as trustee (the
“Trustee”), (b) the Purchase Agreement dated of August 17, 2004 (the “Purchase Agreement”) after
giving effect to the Joinder Agreement among the Company, the Guarantors and the initial purchasers
listed therein (the “Initial Purchasers”) and (c) the Registration Rights Agreement, dated as of
August 20, 2004 (the “Registration Rights Agreement”) after giving effect to the Joinder to the
Registration Rights Agreement among the Company, the Guarantors and the Initial Purchasers, as
executed and delivered by each of the Subsidiary Guarantors, are substantially in the form approved
by each of the Board of

1

 

Directors pursuant to the resolutions referred to in paragraph (iii) above, and have been duly
authorized, executed and delivered by each of the Subsidiary Guarantors;

     (v) Attached hereto as Exhibit D are the names, titles and genuine signatures of the
officers or an attorney-in-fact of such officer of each Subsidiary Guarantor executing (a) the
Indenture, including the guarantees, (b) the Purchase Agreement, (c) the Registration Rights
Agreement and (d) the other documents or certificates delivered by, as of or on the date hereof in
connection with the closing of the sale of the 81/4% Senior Subordinated Notes due 2014, including to
the Trustee. Each of the people listed on Exhibit D was duly elected and qualified as an
officer or was duly appointed as an attorney-in-fact of such duly elected and qualified officer of
each Subsidiary Guarantor and held the office or offices indicated thereon on the date of, and was
duly authorized to take, such action;

     (vi) The minute books of the meetings and actions of the Board of Directors, all committees
thereof and the stockholders of each of the Subsidiary Guarantors which have been made available to
Latham & Watkins LLP and Simpson Thacher & Bartlett LLP, are the original minute books of the
Subsidiary Guarantors or exact copies thereof, and contain all minutes of such meetings and actions
through the date on which Latham & Watkins LLP and Simpson Thacher & Bartlett LLP last reviewed
such books other than such meetings for which no minutes are available, in which case drafts of
minutes, notes as to proceedings at such meetings and agendas have been made available to such
counsel; and

     (vii) (a) Latham & Watkins LLP and (b) Simpson Thacher & Bartlett LLP are entitled to rely on
this certificate in connection with the opinions that such firms are rendering pursuant to Sections
5(g) and 5(h), respectively, of the Purchase Agreement.

[continued on next page]

2

 

     IN WITNESS WHEREOF, the undersigned has executed this certificate as of the date first above
written.

[INSERT NAMES OF SUBSIDIARY GUARANTORS]

By: ______________________________________

Name:

Title:    Secretary

     The undersigned, the duly qualified [insert title] of each Subsidiary Guarantor, DOES HEREBY
CERTIFY that [insert name of Secretary] is the duly elected or appointed Secretary of each
Subsidiary Guarantor and that the signature set forth above [his][her] name is [his][her] true
signature.

     IN WITNESS WHEREOF, the undersigned has executed this certificate as of the date first written
above.

________________________________________

Name:

Title:

3

 

Annex D-1

Form of Opinion of Latham & Watkins LLP

[As of the Closing Date]

1

 

Annex D-2

Form of Opinion of Latham & Watkins LLP

As of the Acquisition Closing

 

 

Annex D-3

Form of Opinion of Special Local Counsel

     1. The [Name of Foreign Guarantor] (the “Foreign Guarantor”) is a corporation or limited
liability company validly existing and in good standing under the laws of its jurisdiction of
incorporation or organization, with the corporate or other power and authority to own, lease and
operate its properties and to conduct its business as described in the Offering Memorandum. Based
solely on certificates from public officials, such counsel confirms that the Foreign Guarantor is
qualified to do business in the jurisdiction of its incorporation or organization as set forth on
Schedule A to this opinion letter.

     2. The Joinder Agreement has been duly authorized, executed and delivered by the Foreign
Guarantor and constitutes a valid and legally binding agreement of the Foreign Guarantor
enforceable against the Foreign Guarantor in accordance with its terms.

     3. The Supplemental Indenture has been duly authorized, executed and delivered by the Foreign
Guarantor.

     4. The Guarantees to be endorsed on the Notes (and the Exchange Notes) have been duly
authorized by the Foreign Guarantor.

     5. The Joinder to the Registration Rights Agreement has been duly authorized, executed and
delivered by the Foreign Guarantor.

     6. The execution and delivery by the Foreign Guarantor of the Supplemental Indenture, the
Joinder Agreement and the Joinder to the Registration Rights Agreement, and the issuance of the
Guarantees by the Foreign Guarantor, will not (x) result in a violation by the Foreign Guarantor of
its Certificate of Incorporation or other operating agreement or Bylaws or (y) violate any [name of
Jurisdiction] statute, rule or regulation applicable to the Foreign Guarantor.

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