Document:

Exhibit 10.1

ASSET PURCHASE AGREEMENT

by and among

ZYGO RICHMOND CORPORATION

ZYGO CORPORATION

and

ASML US, INC.

Dated as of October 27, 2010

TABLE OF CONTENTS

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
 Page

 
	
  

 	
  

 	
  

 	
  

 	
  

 	

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	 
	
 ARTICLE I

 	
  

 	
 DEFINITIONS;
 CERTAIN RULES OF CONSTRUCTION

 	
  

 	
 2

 	 
	
 ARTICLE II

 	
  

 	
 ACQUISITION
 OF ASSETS BY PURCHASER

 	
  

 	
 11

 	 
	
  

 	
 2.1

 	
  

 	
 Purchase and
 Sale of Assets

 	
  

 	
 11

 	 
	
  

 	
 2.2

 	
  

 	
 Excluded
 Assets

 	
  

 	
 12

 	 
	
  

 	
 2.3

 	
  

 	
 Liabilities

 	
  

 	
 12

 	 
	
  

 	
 2.4

 	
  

 	
 Purchase
 Price

 	
  

 	
 14

 	 
	
  

 	
 2.5

 	
  

 	
 The Closing

 	
  

 	
 14

 	 
	
  

 	
 2.6

 	
  

 	
 Allocation
 of Purchase Price

 	
  

 	
 14

 	 
	
  

 	
 2.7

 	
  

 	
 Purchase
 Price Adjustment

 	
  

 	
 14

 	 
	
  

 	
 2.8

 	
  

 	
 Prorated,
 Prepayable and Reimburseable Items

 	
  

 	
 16

 	 
	
  

 	
 2.9

 	
  

 	
 Delivery of
 the Acquired Assets

 	
  

 	
 16

 	 
	
 ARTICLE III

 	
  

 	
 REPRESENTATIONS
 AND WARRANTIES OF THE SELLER

 	
  

 	
 17

 	 
	
  

 	
 3.1

 	
  

 	
 Organization,
 Standing and Power

 	
  

 	
 17

 	 
	
  

 	
 3.2

 	
  

 	
 Authority

 	
  

 	
 17

 	 
	
  

 	
 3.3

 	
  

 	
 Financial
 Statements

 	
  

 	
 18

 	 
	
  

 	
 3.4

 	
  

 	
 Absence of
 Certain Changes

 	
  

 	
 18

 	 
	
  

 	
 3.5

 	
  

 	
 Litigation

 	
  

 	
 19

 	 
	
  

 	
 3.6

 	
  

 	
 Restrictions
 on Business Activities

 	
  

 	
 19

 	 
	
  

 	
 3.7

 	
  

 	
 Intellectual
 Property

 	
  

 	
 19

 	 
	
  

 	
 3.8

 	
  

 	
 Material
 Contracts

 	
  

 	
 23

 	 
	
  

 	
 3.9

 	
  

 	
 Title to
 Acquired Assets

 	
  

 	
 23

 	 
	
  

 	
 3.10

 	
  

 	
 Real
 Property

 	
  

 	
 24

 	 
	
  

 	
 3.11

 	
  

 	
 Environmental
 Matters

 	
  

 	
 25

 	 
	
  

 	
 3.12

 	
  

 	
 Taxes

 	
  

 	
 27

 	 
	
  

 	
 3.13

 	
  

 	
 Employees

 	
  

 	
 27

 	 
	
  

 	
 3.14

 	
  

 	
 Employee
 Plans

 	
  

 	
 29

 	 
	
  

 	
 3.15

 	
  

 	
 Insurance

 	
  

 	
 29

 	 
	
  

 	
 3.16

 	
  

 	
 Licenses and
 Permits

 	
  

 	
 30

 	 
	
  

 	
 3.17

 	
  

 	
 Compliance
 With Laws

 	
  

 	
 30

 	 
	
  

 	
 3.18

 	
  

 	
 Certain
 Business Practices

 	
  

 	
 30

 	 

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
 Page

 
	
  

 	
  

 	
  

 	
  

 	
  

 	

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	 
	
  

 	
 3.19

 	
  

 	
 Suppliers
 and Customers

 	
  

 	
 31

 	 
	
  

 	
 3.20

 	
  

 	
 Brokers’ and
 Finders’ Fee

 	
  

 	
 31

 	 
	
 ARTICLE IV

 	
  

 	
 REPRESENTATIONS
 AND WARRANTIES OF THE PURCHASER AND THE PURCHASER PARENT

 	
  

 	
 31

 	 
	
  

 	
 4.1

 	
  

 	
 Organization,
 Standing and Power

 	
  

 	
 31

 	 
	
  

 	
 4.2

 	
  

 	
 Authority

 	
  

 	
 32

 	 
	
  

 	
 4.3

 	
  

 	
 Financing

 	
  

 	
 32

 	 
	
  

 	
 4.4

 	
  

 	
 Litigation

 	
  

 	
 32

 	 
	
  

 	
 4.5

 	
  

 	
 Brokers’ and
 Finders’ Fee

 	
  

 	
 33

 	 
	
 ARTICLE V

 	
  

 	
 CONDUCT
 PRIOR TO THE CLOSING

 	
  

 	
 33

 	 
	
  

 	
 5.1

 	
  

 	
 Conduct of
 the Business

 	
  

 	
 33

 	 
	
  

 	
 5.2

 	
  

 	
 Title
 Insurance

 	
  

 	
 35

 	 
	
  

 	
 5.3

 	
  

 	
 Notice of
 Certain Events

 	
  

 	
 36

 	 
	
  

 	
 5.4

 	
  

 	
 Bulk Sales
 Compliance

 	
  

 	
 37

 	 
	
  

 	
 5.5

 	
  

 	
 Environmental
 Insurance

 	
  

 	
 37

 	 
	
 ARTICLE VI

 	
  

 	
 CONDITIONS
 TO THE CLOSING

 	
  

 	
 38

 	 
	
  

 	
 6.1

 	
  

 	
 Conditions
 to Obligations of Each Party

 	
  

 	
 38

 	 
	
  

 	
 6.2

 	
  

 	
 Additional
 Conditions to the Obligations of the Purchaser and the Purchaser Parent

 	
  

 	
 38

 	 
	
  

 	
 6.3

 	
  

 	
 Additional
 Conditions to Obligations of the Seller

 	
  

 	
 41

 	 
	
 ARTICLE VII

 	
  

 	
 COVENANTS

 	
  

 	
 42

 	 
	
  

 	
 7.1

 	
  

 	
 Press Releases
 and Public Announcements

 	
  

 	
 42

 	 
	
  

 	
 7.2

 	
  

 	
 Payment
 Received; Payment of Excluded Liabilities and Assumed Liabilities

 	
  

 	
 42

 	 
	
  

 	
 7.3

 	
  

 	
 Future
 Assurances

 	
  

 	
 42

 	 
	
  

 	
 7.4

 	
  

 	
 Access to
 Books, Records, etc.

 	
  

 	
 43

 	 
	
  

 	
 7.5

 	
  

 	
 Confidentiality

 	
  

 	
 43

 	 
	
  

 	
 7.6

 	
  

 	
 Non-Assignable
 Assets

 	
  

 	
 44

 	 
	
  

 	
 7.7

 	
  

 	
 Responsibility
 for Property Taxes; Other Prorations

 	
  

 	
 44

 	 
	
  

 	
 7.8

 	
  

 	
 Offers of
 Employment

 	
  

 	
 45

 	 
	
  

 	
 7.9

 	
  

 	
 COBRA and
 Other Obligations

 	
  

 	
 45

 	 
	
  

 	
 7.10

 	
  

 	
 Wage
 Reporting

 	
  

 	
 46

 	 
	
  

 	
 7.11

 	
  

 	
 Retention
 Grants

 	
  

 	
 46

 	 

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 7.12

 	
  

 	
 No
 Solicitation

 	
  

 	
 46

 	 
	
  

 	
 7.13

 	
  

 	
 Cooperation
 of Independent Accountants

 	
  

 	
 48

 	 
	
  

 	
 7.14

 	
  

 	
 WARN Act

 	
  

 	
 48

 	 
	
  

 	
 7.15

 	
  

 	
 Department
 of Defense

 	
  

 	
 48

 	 
	
  

 	
 7.16

 	
  

 	
 Use of ASML
 Name

 	
  

 	
 48

 	 
	
 ARTICLE VIII

 	
  

 	
 TERMINATION

 	
  

 	
 48

 	 
	
  

 	
 8.1

 	
  

 	
 Termination

 	
  

 	
 48

 	 
	
  

 	
 8.2

 	
  

 	
 Effect of
 Termination

 	
  

 	
 49

 	 
	
 ARTICLE IX

 	
  

 	
 INDEMNIFICATION

 	
  

 	
 49

 	 
	
  

 	
 9.1

 	
  

 	
 Indemnification

 	
  

 	
 49

 	 
	
  

 	
 9.2

 	
  

 	
 Time
 Limitations

 	
  

 	
 51

 	 
	
  

 	
 9.3

 	
  

 	
 Monetary
 Limitations

 	
  

 	
 51

 	 
	
  

 	
 9.4

 	
  

 	
 Other
 Limitations

 	
  

 	
 52

 	 
	
  

 	
 9.5

 	
  

 	
 Claims
 Procedure

 	
  

 	
 53

 	 
	
  

 	
 9.6

 	
  

 	
 Third Party
 Claims

 	
  

 	
 53

 	 
	
  

 	
 9.7

 	
  

 	
 Information

 	
  

 	
 55

 	 
	
  

 	
 9.8

 	
  

 	
 Remedies
 Cumulative; Sole Remedy

 	
  

 	
 55

 	 
	
  

 	
 9.9

 	
  

 	
 Purchase
 Price Adjustment

 	
  

 	
 55

 	 
	
  

 	
 9.10

 	
  

 	
 Insurance
 Recoveries

 	
  

 	
 55

 	 
	
  

 	
 9.11

 	
  

 	
 Mitigation

 	
  

 	
 55

 	 
	
 ARTICLE X

 	
  

 	
 MISCELLANEOUS

 	
  

 	
 56

 	 
	
  

 	
 10.1

 	
  

 	
 Entire
 Agreement

 	
  

 	
 56

 	 
	
  

 	
 10.2

 	
  

 	
 Succession
 and Assignment; No Third-Party Beneficiary

 	
  

 	
 56

 	 
	
  

 	
 10.3

 	
  

 	
 Counterparts

 	
  

 	
 56

 	 
	
  

 	
 10.4

 	
  

 	
 Headings

 	
  

 	
 56

 	 
	
  

 	
 10.5

 	
  

 	
 Notices

 	
  

 	
 56

 	 
	
  

 	
 10.6

 	
  

 	
 Mail

 	
  

 	
 57

 	 
	
  

 	
 10.7

 	
  

 	
 Governing
 Law

 	
  

 	
 58

 	 
	
  

 	
 10.8

 	
  

 	
 Amendments
 and Waivers

 	
  

 	
 58

 	 
	
  

 	
 10.9

 	
  

 	
 Severability

 	
  

 	
 58

 	 
	
  

 	
 10.10

 	
  

 	
 Expenses

 	
  

 	
 58

 	 
	
  

 	
 10.11

 	
  

 	
 Rules of
 Construction

 	
  

 	
 59

 	 
	
  

 	
 10.12

 	
  

 	
 Incorporation
 of Schedules

 	
  

 	
 59

 	 

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 Page

 
	
  

 	
  

 	
  

 	
  

 	
  

 	

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	 
	
  

 	
 10.13

 	
  

 	
 Service of
 Process

 	
  

 	
 59

 	 
	
  

 	
 10.14

 	
  

 	
 Waiver of
 Jury Trial

 	
  

 	
 59

 	 
	
  

 	
 10.15

 	
  

 	
 Arbitration

 	
  

 	
 60

 	 

-iv-

	
  

 	
  

 	
  

 
	
 Exhibits

 	
  

 	
  

 
	

 	
  

 	
  

 
	
  

 	
  

 	
  

 
	
 Exhibit A

 	
  

 	
 Form of
 Preliminary Net Book Value Statement

 
	
  

 	
  

 	
  

 
	
 Exhibit B

 	
  

 	
 Supply
 Agreement

 
	
  

 	
  

 	
  

 
	
 Exhibit C

 	
  

 	
 License and
 Support Agreement

 
	
  

 	
  

 	
  

 
	
 Exhibit D

 	
  

 	
 Form of Bill
 of Sale and Assignment

 
	
  

 	
  

 	
  

 
	
 Exhibit E

 	
  

 	
 Form of
 Assumption Agreement

 
	
  

 	
  

 	
  

 
	
 Exhibit F

 	
  

 	
 Form of
 FIRPTA Certificate

 
	
  

 	
  

 	
  

 
	
 Exhibit G

 	
  

 	
 Matters to
 be Covered by Opinion of the Seller’s Counsel

 
	
  

 	
  

 	
  

 
	
 Exhibit H

 	
  

 	
 Form of
 Trademark Assignment

 

ASSET PURCHASE AGREEMENT

          This ASSET
PURCHASE AGREEMENT (this “Agreement”) is dated as of October 27,
2010, by and among ZYGO RICHMOND CORPORATION, a Delaware corporation (the “Purchaser”),
ZYGO CORPORATION, a Delaware corporation and the parent company of the
Purchaser (the “Purchaser Parent”), and ASML US, INC., a Delaware corporation
(the “Seller”).

W I T N E S S E T H:

          WHEREAS,
the Seller desires to sell and transfer, and the Purchaser desires to purchase
and acquire, assets, properties and rights (subject to the terms and conditions
set forth in the License and Support Agreement (as defined herein)) of the
Richmond, California operations of the Seller as currently conducted (the “Business”) and other Intellectual Property
(as defined herein) of the Seller exclusively used in the Business; 

          WHEREAS, in
connection therewith, subject to the terms and conditions contained in this
Agreement, the Seller hereby shall sell and transfer, and the Purchaser hereby
shall purchase and acquire the Acquired Assets (as defined herein), and the
Seller shall assign and the Purchaser shall assume the Assumed Liabilities (as
defined herein), in exchange for the Purchase Price described herein;

          WHEREAS, at
the Closing (as defined herein), the Seller, ASML NV (as defined below), the
parent company of the Seller, the Purchaser and the Purchaser Parent will enter
into the License and Support Agreement (as defined herein), pursuant to which
the Purchaser or the Purchaser Parent will service specified equipment owned by
the Seller and license the Intellectual Property (as defined herein) included
in the Acquired Assets to the Seller, and the Seller will license to the
Purchaser and the Purchaser Parent certain patent rights not included in the Acquired
Assets but used in the Business as currently conducted, in each case subject to
the restrictions set forth in the License and Support Agreement;

          WHEREAS, at
the Closing, the Seller, the Purchaser and the Purchaser Parent will enter into
the Supply Agreement (as defined herein), pursuant to which the Purchaser and
the Purchaser Parent will serve as a supplier to the Seller, including as to
products produced by the Business, on the terms and conditions set forth in the
Supply Agreement; and

          WHEREAS,
the Seller, the Purchaser and the Purchaser Parent recognize that the success
of the Business post-Closing will depend, among other things, on Employees (as
defined herein) helping to maintain the Purchaser’s and the Purchaser Parent’s capability
as a supplier pursuant to the Supply Agreement and enabling the Purchaser and
the Purchaser Parent to render certain support services contemplated under the
License and Support Agreement, and acknowledge that in furtherance of such
objectives, the Purchaser and the Purchaser Parent have agreed to extend offers
to employment to Employees as further described herein, and the Purchaser
Parent has agreed to establish a retention pool of restricted Common Stock (as
defined herein) of the Purchaser Parent to enable Retention Grants to be made
to certain Employees after the Closing, as further described herein.

          NOW,
THEREFORE, in consideration of the premises and the mutual promises made
herein, in the License and Support Agreement and in the Supply Agreement, and
in consideration of the representations, warranties, and covenants herein
contained, the Parties agree as follows.

ARTICLE I

DEFINITIONS; CERTAIN RULES OF CONSTRUCTION

          As used
herein, the following terms will have the following meanings:

          “Accounting Firm” has the meaning set forth
in Section 6.2(g).

          “Acquired Assets” has the meaning set forth
in Section 2.1.

          “Action” means any action, cause of action
or suit (whether in contract or tort or otherwise), litigation (whether at law
or in equity and whether civil or criminal), controversy, assessment,
arbitration, formal investigation, hearing, charge, complaint, notice or
proceeding to, from, by or before any Governmental Authority.

          “Affiliate” means, as to any specified
Person at any time, each Person who is directly or indirectly controlling,
controlled by or under direct or indirect common control with such specified
Person at such time.

          “Affiliated Group” means any affiliated group
within the meaning of Section 1504(a) of the Code or any similar group defined
under a similar provision of state, local or non-U.S. law. 

          “Agreement” has the meaning set forth in the
preamble.

          “Allocation Statement” has the meaning set
forth in Section 2.6.

          “Applicable Property” has the meaning set
forth in Section 3.11(a)(i).

          “ASML NV”
means ASML Holding NV, a company organized under the laws of The Netherlands.

          “Assumed Contracts” has the meaning set
forth in Section 2.1(d).

          “Assumed Liabilities” has the meaning set
forth in Section 2.3.

          “Assumption Agreement” has the meaning set
forth in Section 6.2(f)(iii).

          “Basket” has the meaning set forth in
Section 9.3(a).

          “Business” has the meaning set forth in the
recitals.

          “Business Day” means a day, other than
Saturday, Sunday or other day on which commercial banks in New York, New York
are authorized or required by law to close.

          “Business Intellectual Property” has the
meaning set forth in Section 3.7(b).

-2-

          “Business Material Adverse Effect” means,
with respect to the Business, any change, effect, event or occurrence (or any
development that is reasonably likely to have any change or effect) that is
materially adverse to the business, financial condition or results of
operations of the Business, taken as a whole, or which is reasonably likely to
prevent or materially delay the consummation of the Contemplated Transactions; provided, however, that none of the
following shall be deemed in themselves, either alone or in combination, to
constitute, and none of the following shall be taken into account in
determining whether there has been a Business Material Adverse Effect: (i) any
adverse change, event, development, circumstance or effect arising from or
relating, directly or indirectly, to general business or economic conditions
(to the extent such change, event, development, circumstance or effect does not
disproportionately affect the Business relative to other businesses in the
industry or industries in which the Business is operated or conducted), (ii)
any failure by the Seller to meet any internal budgets, plans, forecasts or
projections or any published revenue or earnings predictions for the Business
for any period ending (or for which revenues or earnings are released) on or
after the date of this Agreement, (iii) any adverse change, event, development,
circumstance or effect arising from or relating, directly or indirectly, to any
change in GAAP or the interpretation thereof, (iv) any adverse change, event,
development, circumstance or effect arising from or relating, directly or
indirectly, to any changes in applicable law, regulation or other legal or
regulatory conditions or the interpretation thereof after the date of this
Agreement, (v) any adverse change, event, development, circumstance or effect
arising from or relating, directly or indirectly, to any changes generally in
the industry or industries in which the Business is operated or conducted (to
the extent such change, event, development, circumstance or effect does not
disproportionately affect the Business relative to other businesses in the
industry or industries in which the Business is operated or conducted), (vi)
any adverse change, event, development, circumstance or effect arising from or
relating, directly or indirectly, to any acts of war, sabotage or terrorism
(including any escalation or general worsening of any such acts of war,
sabotage or terrorism) in the United States or any other country or region in
the world (to the extent such change, event, development, circumstance or
effect does not disproportionately affect the Business relative to other
businesses in the industry or industries in which the Business is operated or
conducted), (vii) any adverse change, event, development, circumstance or
effect arising from or relating, directly or indirectly, to any earthquakes,
hurricanes, tsunamis, tornadoes, floods, mudslides, wild fires or other natural
disasters or weather conditions in the United States or any other country or
region in the world (to the extent such change, event, development,
circumstance or effect does not disproportionately affect the Business relative
to other businesses in the industry or industries in which the Business is
operated or conducted), (viii) any adverse change, event, development,
circumstance or effect arising from or relating, directly or indirectly, to the
announcement of this Agreement by the Parties or the pendency or consummation
of the Contemplated Transactions, (ix) any adverse change, event, development,
circumstance or effect arising from or relating, directly or indirectly, to
compliance by the Parties with the terms of, or the taking of any action
required by this Agreement, or the failure to take any action prohibited by
this Agreement or (x) any adverse change, event, development, circumstance or
effect arising from or relating, directly or indirectly, to any actions taken,
or failure to take action, in each case, to which the Purchaser has in writing
expressly approved, consented to or requested.

          “Cap” has the meaning set forth in Section
9.3(a).

          “Claims
Period” has the meaning set forth in Section 9.2.

-3-

          “Closing” has the meaning set forth in
Section 2.5. 

          “Closing Date” has the meaning set forth in
Section 2.5.

          “Closing Date Employee” has the meaning set
forth in Section 7.8.

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

          “Commitment” has the meaning set forth in
Section 5.2(a).

          “Common Stock” means the common stock, par
value $0.10 per share, of the Purchaser.

          “Confidential Information” has the meaning
set forth in Section 7.5(a).

          “Contemplated Transactions” means the
transactions contemplated by this Agreement.

          “Copyrights” has the meaning set forth in
Section 3.7(a)(iii).

          “Default Liabilities” has the meaning set
forth in Section 2.3.

          “Disclosure Schedule” has the meaning set
forth in the introductory paragraph of Article III.

          “Dispute Notice” has the meaning set forth
in Section 2.7(c).

          “Effective Time” means 12:01 a.m., Eastern
Time, on the Closing Date.

          “Employee Plans” means each material “employee
benefit plan” (as defined in Section 3(3) of ERISA), and any material
employment, severance, change in control, incentive, deferred compensation,
fringe benefit, or other compensatory agreement, plan, program or arrangement
that is not an “employee benefit plan” (as so defined) covering any Employee of
the Business who may become a Transferred Employee or any beneficiary or
dependent of any such person.

          “Employees” has the meaning set forth in
Section 3.13(a).

          “Environmental Condition” shall mean any
pollution, contamination, degradation, damage or injury caused by, related to,
arising from or in connection with the generation, handling, use, treatment,
storage, transportation, disposal, discharge, Release or emission of any
“Hazardous Materials.”

          “Environmental
Impairment Liability Insurance Policy” has the meaning set forth in
Section 5.5.

          “Environmental Laws” means any applicable
law relating to (i) the protection of (A) human health, fish, wildlife or the
environment or (B) the public or employee welfare from actual or potential
exposure (or the effects of exposure) to any actual or potential Release
(whether past or present) of any Hazardous Materials or (ii) pollution, natural
resource damages, conservation of resources, waste management or the
manufacture, generation, production, processing, distribution, use, treatment,
labeling, storage, release, emission, discharge, 

-4-

remediation, removal, disposal, transport or handling of any toxic or
hazardous substance or material (including asbestos, polychlorinated biphenyls,
crude petroleum and its fractions or derivatives thereof), including without
limitation the following: the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980 (“CERCLA”),
the Resource Conservation and Recovery Act of 1976 (“RCRA”), the Clean Air Act, the Federal Water Pollution Control
Act, the Safe Drinking Water Act, the Toxic Substances Control Act, the
Hazardous & Solid Waste Amendments Act of 1984, the Superfund Amendments
and Reauthorization Act of 1986, the Hazardous Materials Transportation Act,
the Occupational Safety and Health Act of 1970, the Oil Pollution Act of 1990,
the Emergency Planning and Community Right-to-Know Act of 1986, each as
amended, and any state and local laws implementing or comparable to any of the
foregoing federal laws, and any regulations promulgated by any Governmental
Authority pursuant to any of the foregoing.

          “Environmental Liabilities” shall mean any
and all liabilities, responsibilities, claims, suits, damages, costs (including
remedial, removal, response, abatement, clean-up, investigative or monitoring
costs and any other related costs and expenses), other causes of action,
damages, settlements, expenses, charges, assessments, liens, penalties, fines,
pre-judgment and post-judgment interest, attorneys’ fees and other legal fees
(a) pursuant to any agreement, order, notice or responsibility, directive
(including directives embodied in Environmental Laws), injunction, judgment or
similar documents (including settlements) arising out of or in connection with
any Environmental Laws, or (b) pursuant to any claim by a Governmental
Authority or other person for personal injury, property damage, damage to
natural resources, remediation or payment or reimbursement of remediation costs
incurred or expended by a Governmental Authority or person pursuant to
Environmental Laws.

          “Environmental Material Adverse Effect”
shall mean any Environmental Liabilities that are reasonably expected to exceed
$50,000 per occurrence or series of related occurrences or $250,000 in the
aggregate. 

          “Environmental Permit” means any Permit
relating to Legal Requirements under Environmental Laws.

          “Environmental Study” has the meaning set
forth in Section 3.11(c). 

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

          “Excluded Assets” has the meaning set forth
in Section 2.2.

          “Excluded Liabilities” has the meaning set
forth in Section 2.3.

          “Financial Statements” has the meaning set
forth in Section 3.3.

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

          “Governmental Authority” means any United
States federal, state or local or any foreign government, or political
subdivision thereof, or any multinational organization or authority or any
authority, agency or commission entitled to exercise any administrative, 

-5-

executive, judicial, legislative, police, regulatory or taxing
authority or power, any court or tribunal (or any department, bureau or
division thereof), or any arbitrator or arbitral body.

          “Hazardous Materials” means, collectively,
any substance that is identified and regulated (or the cleanup of which can be
required) under any Environmental Law, and, in addition, any substance which
requires special handling, storage or disposal procedures or whose use,
handling, storage or disposal of which is in any way regulated, whether now or
in the future, in any case under any applicable law for the protection of
health, safety or the environment. Without limiting the generality of the
foregoing, the term “Hazardous Materials” shall include any material, chemical,
liquid, gas compound, substance, mixture or by-product that is identified,
defined, designated, listed, restricted or otherwise regulated under
Environmental Laws as a “hazardous constituent,” “hazardous substance,”
“hazardous material,” “hazardous waste,” “infectious waste,” “medical waste,”
“biomedical waste,” “solid waste”, “pollutant” “toxic pollutant” or
“contaminant,” or any other formulation or terminology intended to classify or
identify substances, constituents, materials, or wastes by reason of properties
that are deleterious to the environment, natural resources, worker health and
safety, or public health and safety, including, without limitation,
ignitability, corrosivity, reactivity, carcinogenicity, toxicity and
reproductive toxicity.

          “Improvements” has the meaning set forth in
Section 3.10(c).

          “Indemnified Party” has the meaning set
forth in Section 9.2.

          “Indemnifying Party” has the meaning set
forth in Section 9.2.

          “Insurance Policies” has the meaning set
forth in Section 3.15.

          “Intellectual Property” has the meaning set
forth in Section 3.7.

          “Inventory” has the meaning set forth in
Section 2(a)(ii).

          “IRS” means the United States Internal
Revenue Service or any successor thereto.

          “Issued Patents” has the meaning set forth
in Section 3.7(a)(i).

          “knowledge” (i) of the Seller means the
actual knowledge of David Kim, Dan Bajuk, Rich Rogoff, Remko Mooij and/or
William Amalfitano and after reasonable inquiry of the persons with
responsibility for the applicable area and (ii) of the Purchaser or the
Purchaser Parent means the actual knowledge after reasonable inquiry of Chris
Koliopoulos, John Stack, John Tomich and Douglas Eccleston.

          “Legal Requirement” means any United States
federal, state or local (including, without limitation, California) or any
foreign law, statute, standard, ordinance, code, rule, regulation, resolution
or promulgation, or any order, judgment or decree of any Governmental
Authority, or any similar provision having the force and effect of law.

          “License and Support Agreement” has the
meaning set forth in Section 6.1(d).

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          “Lien” means, with respect to any Acquired
Asset, any mortgage, lien, pledge, charge, claim, security interest, judgment, community
or other marital property interest, equitable interest, lease, sublease,
license, right of way, easement, encroachment, servitude, right of first offer
or first refusal, reservation, restriction, buy/sell agreement or other
encumbrance with respect to the use, construction, voting (in the case of any
security or equity interest), transfer, receipt of income, or exercise of any
other attribute of ownership in respect of such Acquired Asset.

          “Losses” means, collectively, any actions,
liabilities, governmental orders, encumbrances, losses, damages, bonds, dues,
assessments, fines, penalties, Taxes, fees, costs (including reasonable costs
of investigation, defense and enforcement of this Agreement), expenses or
amounts paid in settlement (in each case, including reasonable attorneys’ and
experts fees and expenses), whether or not involving a Third Party Claim.

          “Monetary Encumbrances” shall have the
meaning set forth in Section 5.2(d).

          “Necessary Intellectual Property” shall have
the meaning set forth in Section 3.7(j).

          “Objection Notice” has the meaning set forth
in Section 5.2(c).

          “Objections” has the meaning set forth in
Section 5.2(c).

          “Operative
Agreements” means this Agreement, the License and Support Agreement
and the Supply Agreement.

          “Ordinary Course of Business” means, with
respect to the Business, the ordinary course of business which is consistent
with past customs and practices of the Seller in the conduct of the Business (including
past practice with respect to quantity, amount, magnitude and frequency,
standard employment, inventory and payroll policies) taken in the ordinary
course of the normal day-to-day operations. 

          “Owned Real Property” has the meaning set forth
in Section 3.10(a).

          “Parties” means the Purchaser, the Purchaser
Parent and the Seller, collectively.

          “Party” means either of the Parties
individually.

          “Patent Applications” has the meaning set
forth in Section 3.7(a)(ii).

          “Patents” has the meaning set forth in
Section 3.7(a)(ii).

          “Permits” has the meaning set forth in
Section 3.16.

          “Permitted Liens” means (i) Liens for
current Taxes not yet due and payable, (ii) such Liens as do not, or would not
reasonably be expected to, materially detract from or materially interfere with
the use of the Acquired Assets subject thereto, and (iii) Liens which will be
satisfied or released on or before Closing.

-7-

          “Person” means an individual, a partnership,
a corporation, an association, a joint stock company, a limited liability
company, a trust, a joint stock or venture, an unincorporated organization, a
Governmental Authority, an estate or other entity or organization.

          “Personal Property” has the meaning set
forth in Section 2.1(a).

          “Post-Closing Date Tax Period” means (a) any
Tax period beginning on or after the Closing Date and (b) with respect to any
Straddle Period, the portion of such period beginning on or after the Closing
Date.

          “Pre-Closing Date Tax Period” means (a) any
Tax period ending before the Closing Date and (b) with respect to any Straddle
Period, the portion of such period ending the day before the Closing Date.

          “Preliminary Net Book Value” has the meaning
set forth in Section 2.7(a).

          “Preliminary Net Book Value Statement” has
the meaning set forth in Section 2.7(a).

          “Pro Forma Statement Date” has the meaning
set forth in Section 3.4.

          “Products” has the meaning set forth in
Section 3.7(b).

          “Property Tax” means any personal or real
property Tax or similar ad valorem Tax.

          “Purchase Price” has the meaning set forth
in Section 2.4.

          “Purchaser” has the meaning set forth in the
preamble.

          “Purchaser Indemnified Person” has the
meaning set forth in Section 9.1(a). 

          “Purchaser Material Adverse Effect” means
any change, effect, event or occurrence (or any development that has had or
would be reasonably likely to have any change or effect) that is materially
adverse to the business, financial condition or results of operations of the
Purchaser and its subsidiaries, taken as a whole, which would be reasonably
likely to adversely affect the ability of the Purchaser to conduct the Business
after the Closing as currently conducted, or which would be reasonably likely
to prevent or materially delay the consummation of the Contemplated
Transactions; provided, however,
that none of the following shall be deemed in themselves, either alone or in
combination, to constitute, and none of the following shall be taken into
account in determining whether there has been a Purchaser Material Adverse
Effect: (i) any adverse change, event, development, circumstance or effect
arising from or relating, directly or indirectly, to general business or
economic conditions (to the extent such change, event, development,
circumstance or effect does not disproportionately affect the Purchaser
relative to other businesses in the industry or industries in which the
Purchaser conducts its business or operates), (ii) any failure by the Purchaser
to meet any internal budgets, plans, forecasts or projections or any published
revenue or earnings predictions for any period ending (or for which revenues or
earnings are released) on or after the date of this Agreement, (iii) any
adverse change, event, development, circumstance or effect arising from or
relating, directly or indirectly, to any change in GAAP or other accounting
standards or the interpretation thereof, 

-8-

(iv) any adverse change, event, development, circumstance or effect
arising from or relating, directly or indirectly, to any changes in applicable
law, regulation or other legal or regulatory conditions or the interpretation
thereof after the date of this Agreement, (v) any adverse change, event,
development, circumstance or effect arising from or relating, directly or
indirectly, to any changes generally in the industry or industries in which the
Purchaser conducts its business or operates (to the extent such change, event,
development, circumstance or effect does not disproportionately affect the
Purchaser relative to other businesses in the industry or industries in which
the Purchaser conducts its business or operates), (vi) any adverse change, event,
development, circumstance or effect arising from or relating, directly or
indirectly, to any acts of war, sabotage or terrorism (including any escalation
or general worsening of any such acts of war, sabotage or terrorism) in the
United States or any other country or region in the world (to the extent such
change, event, development, circumstance or effect does not disproportionately
affect the Purchaser relative to other businesses in the industry or industries
in which the Purchaser conducts its business or operates), (vii) any adverse
change, event, development, circumstance or effect arising from or relating,
directly or indirectly, to any earthquakes, hurricanes, tsunamis, tornadoes,
floods, mudslides, wild fires or other natural disasters or weather conditions
in the United States or any other country or region in the world (to the extent
such change, event, development, circumstance or effect does not
disproportionately affect the Purchaser relative to other businesses in the
industry or industries in which the Purchaser conducts its business or
operates), (viii) any adverse change, event, development, circumstance or
effect arising from or relating, directly or indirectly, to the announcement of
this Agreement by the Parties or the pendency or consummation of the
Contemplated Transactions, (ix) any adverse change, event, development,
circumstance or effect arising from or relating, directly or indirectly, to
compliance by the Parties with the terms of, or the taking of any action
required by this Agreement, or the failure to take any action prohibited by
this Agreement or (x) any adverse change, event, development, circumstance or
effect arising from or relating, directly or indirectly, to any actions taken,
or failure to take action, in each case, to which the Seller has in writing
expressly approved, consented to or requested.

          “Purchaser Parent” has the meaning set forth
in the preamble. 

          “Purchaser Person” has the meaning set forth
in Section 7.12(a).

          “Real Property Laws” has the meaning set
forth in Section 3.10(d).

          “Records” has the meaning set forth in
Section 2.1(g).

          “Referee” has the meaning set forth in
Section 2.7(d).

          “Regulation
S-X” has the meaning set forth in Section 7.4(a).

          “Release” means any spilling, leaking,
pumping, pouring, emitting, discharging, dumping or disposing of any Hazardous
Material into the environment.

          “Response Notice” has the meaning set forth
in Section 5.2(c).

          “Restricted Period” has the meaning set
forth in Section 7.12(a).

-9-

          “Restrictive Covenants” has the meaning set
forth in Section 7.12(b).

          “Retention Grants” has the meaning set forth
in Section 7.11.

          “Revised Net Book Value” has the meaning set
forth in Section 2.7(d).

          “Revised Net Book Value Statement” has the
meaning set forth in Section 2.7(b).

          “Richmond
Facility” means the Richmond, California facility of the Seller.

          “Rules” has the meaning set forth in Section
10.15.

          “Seller Indemnified Person” has the meaning
set forth in Section 9.1(b).

          “Seller Person” has the meaning set forth in
Section 7.12(a).

          “Seller” has the meaning set forth in the
preamble.

          “Straddle Period” means any Tax period
beginning before the Closing Date and ending after the Closing Date.

          “Supply Agreement” has the meaning set forth
in Section 6.1(c).

          “Survey” has the meaning set forth in
Section 5.2(a).

          “Tax” or “Taxes”
includes (1) any federal, state, local or foreign income, gross receipts,
capital, franchise, import, goods and services, value added, sales and use,
estimated, alternative minimum, add-on minimum, sales, use, transfer,
registration, excise, natural resources, severance, stamp, occupation, premium,
windfall profit, environmental, customs, duties, real property, personal
property, capital stock, social security, unemployment, disability, payroll,
license, employee withholding or other tax of any kind whatsoever, including
any interest, penalties or additions to tax or additional amounts in respect of
the foregoing, (2) any liability for the payment of any amounts of the type
described in clause (1) as a result of being a member of a consolidated,
combined, unitary or aggregate group for any taxable period, and (3) any
liability for the payment of any amounts of the type described in clause (1) or
clause (2) as a result of being a transferee or successor to any person or as a
result of any express or implied obligation to indemnify any other Person.

          “Tax Return” means returns, declarations,
reports, claims for refund, information returns or other documents (including
any related or supporting schedules, statements or information) filed or
required to be filed in connection with the determination, assessment or
collection of any Taxes.

          “Third Party Claim” has the meaning set
forth in Section 9.6(a).

          “Third Party Intellectual Property” has the
meaning set forth in Section 3.7(c).

          “Title Insurer” has the meaning set forth in
Section 5.2(a).

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          “Title Policy” has the meaning set forth in
Section 5.2(a).

          “Trademark” has the meaning set forth in
Section 3.7(a)(iv).

          “Trademark Assignment” has the meaning set
forth in Section 6.2(k).

          “Transaction Expenses” means all
out-of-pocket fees and expenses incurred by a Party in connection with the
Contemplated Transactions including the fees and expenses of attorneys,
accountants, agents, brokers and any other advisors.

          “Transfer Taxes” has the meaning set forth
in Section 10.10.

          “Transferred Employee” has the meaning set
forth in Section 7.8.

          “Treasury Regulations” means the Treasury
Regulations (including Temporary Regulations) promulgated by the United States
Department of Treasury with respect to the Code or other United States federal
Tax statutes.

          “Use Laws” has the meaning set forth in
Section 3.10(d).

          “WARN”
has the meaning set forth in Section 7.14.

          “WIP” has the meaning set forth in Section
2.1(a).

ARTICLE II

ACQUISITION OF ASSETS BY PURCHASER

          2.1          Purchase
and Sale of Assets. The Seller agrees to sell and transfer to the
Purchaser, and the Purchaser agrees to purchase and acquire from the Seller at
the Closing, subject to the exclusions contained in Section 2.2 and subject to
and upon the other terms and conditions contained herein, all of the Seller’s
right, title and interest in and to all of the following assets, properties and
rights owned by the Seller as of the Closing Date (collectively, the “Acquired Assets”), free and clear of any
Liens and liabilities, other than Permitted Liens and Assumed Liabilities: 

                                   (a)          (i)
the tangible personal property and leasehold improvements, including machinery,
equipment (including computer equipment), tools, furniture, fixtures,
furnishings and shelving located at the Richmond Facility, all as set forth on
the fixed asset register attached hereto as Schedule 2.1(a)(i), and (ii)
all inventory of the Business located at the Richmond Facility, consisting of
materials and work in progress (“WIP”),
but excluding obsolete inventory and finished goods, all as set forth on Schedule
2.1(a)(ii) (such items set forth on Schedule 2.1(a)(ii), collectively, the
“Inventory,”
and collectively with the items set forth on Schedule 2.1(a)(i), “Personal Property”);

                                   (b)          all
right, title and interest in (i) the Owned Real Property and Improvements and
(ii) all surveys, plans, specifications, operating manuals, warranties and
guarantees covering the Improvements;

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                                   (c)          all
cash generated by the Purchaser’s operation of the Acquired Assets after the
Closing Date;

                                   (d)          all
of the Seller’s rights under the contracts listed on Schedule 2.1(d)
(the “Assumed Contracts”);

                                   (e)          all
Intellectual Property, goodwill associated therewith, licenses and sublicenses
granted to the Seller in respect thereto and rights of the Seller thereunder,
remedies against past, current and future infringements thereof and rights to
protection therein, in each case exclusively used in the current conduct of the
Business (except for Trademarks which include the Seller’s name, other than
ASML PerfectWave), to the extent transferable; 

                                   (f)          all
licenses, permits, consents, certificates, franchises or other governmental
authorizations exclusively used in the current conduct of the Business by the
Seller or the current ownership, use or operation of the Owned Real Property or
the Improvements by the Seller, other than any such licenses, permits,
consents, certificates, franchises or other governmental franchises which
cannot be legally transferred;

                                   (g)          all
books, records, files, printouts, drawings, data, files, notes, notebooks,
accounts, invoices, correspondence, specifications, creative materials,
advertising or promotional materials, marketing materials, studies, reports,
memoranda or papers, software (including past versions thereof to the extent
readily available and transferable) or relevant portion thereof (collectively,
“Records”), in each case in the
Seller’s possession and physically located at the Richmond Facility, whether in
hard copy, electronic or other format, and, in the case of Records in hard
copy, physically located at Richmond Facility, used exclusively in the past or
current conduct of the Business by the Seller or its predecessors, or the
ownership, use and operation of the Owned Real Property and Improvements by the
Seller or its predecessors;

                                   (h)          all
goodwill associated with the Acquired Assets; and

                                   (i)          any
supplies ordered by the Seller for use exclusively in the Business at the
Richmond Facility, but not yet received as of the Closing Date (provided that
the obligation to pay for any such supplies that shall not have been paid for
by the Seller prior to the Closing Date shall be Assumed Liabilities, as
defined below, but the cost of such unpaid supplies shall not be included in
the calculation of the net book value of the Acquired Assets pursuant to
Section 2.7).

          2.2          Excluded
Assets. Notwithstanding any provision in this Agreement to the contrary,
the Purchaser agrees that the Seller shall retain and not sell, assign,
transfer or deliver, and the Purchaser shall not purchase, acquire or have any
ownership claim, or right in respect of any assets of the Seller that are not
Acquired Assets (collectively, the “Excluded Assets”).

          2.3          Liabilities.
Notwithstanding any provision in this Agreement or any other writing to the
contrary, neither the Purchaser nor the Purchaser Parent is assuming any
liability of the Seller or the Seller’s Affiliates of whatever nature, whether
presently in existence or arising hereafter, other than (a) all liabilities
arising out the Purchaser’s and the Purchaser Parent’s ownership or operation
of the Business or the Acquired Assets, in each case solely after the Closing
Date, (b) all liabilities arising under the Assumed Contracts listed in Schedule
2.1(d)

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hereto, other than the Default Liabilities and (c) the liabilities
identified in Schedule 2.3 hereto (collectively, the “Assumed
Liabilities”). Notwithstanding the foregoing or anything herein to
the contrary, the Purchaser shall in no event assume any liability of the
Seller or any Affiliate of the Seller:

                                             (i)           arising
from or in connection with any Excluded Asset;

                                             (ii)          arising
from or in connection with any transactions between the Seller and any
Affiliate thereof;

                                             (iii)         not
relating to the Acquired Assets or the Business; 

                                             (iv)          arising
from or in connection with the Seller’s Transaction Expenses except to the
extent specifically allocated to the Purchaser pursuant to this Agreement; 

                                             (v)           arising
from or in connection with insurance policies of the Seller;

                                             (vi)          arising
from or in connection with obligations under Assumed Contracts that arose or
accrued based on any act, event, or omission that occurred prior to the Closing
Date, which shall in all cases be retained by the Seller irrespective of
whether they are known at Closing or become known only after the Closing or
based on any breach or default of the Seller that occurred prior to the Closing
Date (the liabilities described in this clause (vi), “Default Liabilities”);

                                             (vii)         under
or with respect to any Employee Plan, or to or with respect to any current or
former employee of the Seller, that arose prior to the Closing Date (provided
that, for the purpose of clarity, all liabilities with respect to
employment-related claims of Transferred Employees or payroll of the Business
after the Closing Date shall be Assumed Liabilities);

                                             (viii)        for
Taxes for any tax period prior to the Closing Date, whether or not accrued,
assessed, or currently due and payable and whether or not they relate to the
Business, except for Taxes arising out of the consummation of this Agreement
specifically allocated to the Purchaser pursuant to Section 7.7 or Section
10.10;

                                             (ix)          relating
to product warranty claims for sales of products of the Business prior to the
Closing; or

                                             (x)           incurred
(or resulting from any action occurring) prior to the Closing that is not
otherwise an Assumed Liability. 

All liabilities of any nature, matured or unmatured, fixed or
contingent, whether pursuant to contracts or otherwise, that are not expressly
assumed as Assumed Liabilities hereunder, or are expressly excluded hereunder,
shall be retained by and remain liabilities of the Seller and satisfied by the
Seller in accordance with their terms (all such liabilities not being assumed,
the “Excluded Liabilities”).

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          2.4          Purchase
Price. In consideration for the Acquired Assets, the Purchaser shall assume
the Assumed Liabilities and the Purchaser Parent shall pay the Seller at
Closing aggregate cash consideration in an amount equal to the Preliminary Net
Book Value, subject to adjustment in accordance with Section 2.7 or reduction
pursuant to Section 5.2(c) or (d). Such assumption of the Assumed Liabilities
and payment of cash shall constitute the “Purchase
Price.” The Purchase Price may be adjusted pursuant to Section 2.7,
5.2(c) or (d), 7.6 or 9.9.

          2.5          The
Closing. The closing (the “Closing”)
of the sale and purchase of the Acquired Assets and the assignment and
assumption of the Assumed Liabilities hereunder shall take place at the offices
of Fulbright & Jaworski L.L.P., 666 Fifth Avenue, New York, NY
10103 on November 12, 2010 or at such other location and on such date as the
Parties may mutually agree (the “Closing Date”).
The Closing shall be effective as of the Effective Time.

          2.6          Allocation
of Purchase Price. Attached hereto as Schedule 2.6 is a statement
(the “Allocation Statement”)
setting forth the allocation of the Purchase Price as described therein, which
reflects the agreement between the Parties with respect to the allocation of
the Purchase Price among the Acquired Assets and which the Parties agree is in
accordance with the provisions of Section 1060 of the Code and the Treasury
Regulations. The Allocation Statement will be revised to reflect any
adjustments necessary as a result of any adjustment to the Purchase Price
referenced in Section 2.4. The Parties agree to be bound by the values assigned
and set forth in such Allocation Statement and to use such Allocation Statement
in the preparation, filing and audit of all relevant Tax Returns (including
filing Form 8594 with their federal income Tax Returns for the taxable year
that includes the date of the Closing). None of the Parties shall take any
position (whether in audits, Tax Returns or otherwise) which is inconsistent
with such allocation unless required to do so by applicable law.

          2.7          Purchase
Price Adjustment.

                                   (a)          Preliminary
Net Book Value Statement. Not later than four (4) Business Days prior to the
Closing Date, the Seller shall prepare and deliver to the Purchaser a statement
in substantially the form attached hereto as Exhibit A, reflecting the
Seller’s good faith calculation of (i) the net book value of the Acquired
Assets, other than the Inventory, as of October 31, 2010 and (ii) the projected
net book value of the Inventory as of the Closing Date (such statement, the “Preliminary Net Book Value Statement”). The
Preliminary Net Book Value Statement shall be properly derived from the books
and records of the Business, and prepared in accordance with GAAP in a manner
consistent with the principles, methodologies and assumptions used by the
Seller in preparing the Financial Statements. Following the Seller’s delivery
of the Preliminary Book Value Statement to the Purchaser, the Seller shall
deliver any other information that the Purchaser may reasonably request in
order to verify the amounts reflected in the Preliminary Net Book Value
Statement. If all or any portion of the Preliminary Net Book Value Statement is
not reasonably acceptable to the Purchaser, the Parties will negotiate in good
faith to resolve such disagreements prior to the Closing Date. The Preliminary
Net Book Value Statement shall be subject to the reasonable approval of the
Purchaser, which approval shall not be unreasonably withheld or delayed. The “Preliminary Net Book Value” shall equal the
amount set forth in the Preliminary Net Book Value Statement as so approved by
the Purchaser. The Preliminary Net Book Value Statement shall be attached as Schedule
2.7(a) to, and shall form an integral part of, this Agreement.

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                                   (b)          Revised
Net Book Value Statement. As promptly as possible and in any event within
thirty (30) days after the Closing, the Parties will jointly prepare a
statement reflecting, in reasonable detail, the Parties’ good faith calculation
of (i) the net book value of the Acquired Assets, other than the Inventory, as
of October 31, 2010, (ii) the net book value of the Inventory as of the Closing
Date, and (iii) any increase, or decrease (excluding any decrease to the extent
resulting from depreciation), in the net book value of the Acquired Assets,
other than Inventory, from capital expenditures, capital additions or capital
improvements to the Acquired Assets during the period beginning on November 1,
2010 and ending on the Closing Date (the “Revised
Net Book Value Statement”). The Revised Net Book Value Statement
shall be properly derived from the books and records of the Business, and prepared
in accordance with GAAP in a manner consistent with the principles,
methodologies and assumptions used by the Seller in preparing the Financial
Statements.

                                   (c)          Dispute
Notice. If the Parties are unable to agree on the Revised Net Book Value
Statement within the 30-day period contemplated in Section 2.7(b), then each
Party shall, within five (5) Business Days thereafter, provide a written notice
(a “Dispute Notice”) to the other
Party identifying in reasonable detail (i) any item on the then current draft
of the Revised Net Book Value Statement which such Party believes is erroneous
and (ii) such Party’s calculation of the correct amount of such item. Any item
or amount to which no dispute is raised in a Dispute Notice will be final,
conclusive and binding on the Parties.

                                   (d)          Resolution
of Disputes. The Purchaser and the Seller will attempt to resolve the
matters raised in any Dispute Notice in good faith. Five (5) Business Days
after delivery of the Dispute Notice, either the Purchaser or the Seller may
provide written notice to the other Party that it elects to submit the disputed
items to a nationally recognized independent accounting firm, other than
Deloitte & Touche LLP, chosen jointly by the Purchaser and the Seller (the
“Referee”). The Referee will
promptly, in accordance with the Commercial Arbitration Rules of the American
Arbitration Association, review only those items and amounts specifically set
forth and objected to in the Dispute Notice and resolve the dispute with
respect to each such specific item and amount in accordance with the principles
described in Section 2.7(b). In resolving such disputes, the Referee will
review only those items and amounts specifically set forth or objected to in a
Dispute Notice and will resolve the dispute with respect to each such item and
amount. Such resolution will be based solely on the written submission of the
Parties, the Dispute Notice, the Preliminary Net Book Value Statement as
attached as Schedule 2.7(a) to this Agreement and the then current draft
of the Revised Net Book Value Statement and not on any independent review by
the Referee. The fees and expenses of the Referee will be borne by the
Purchaser and the Purchaser Parent, on the one hand, and the Seller on the
other hand, based upon the percentage which the portion of the contested amount
not awarded to each Party bears to the amount actually contested, and the
decision of the Referee with respect to the items set forth in the Dispute
Notice submitted to it will be final, conclusive and binding on the Parties.
Each Party shall provide the other full access to those books and records and
working papers of the Business used in the preparation of, or objection to, as
the case may be, the Preliminary Net Book Value Statement and the Revised Net
Book Value Statement. Each of the Parties agrees to use its commercially
reasonable efforts to cooperate with the Referee and to cause the Referee to
resolve any dispute no later than thirty (30) Business Days after selection of
the Referee. The Referee shall, based upon its resolution of the disputed items
and undisputed items set forth in the draft of the Revised Net Book Value
Statement, prepare the final Revised Net Book Value 

-15-

Statement, which shall be binding on the Parties. The sum of (i) the
net book value of the Acquired Assets, other than the Inventory, as of October
31, 2010, (ii) the net book value of the Inventory as of the Closing Date, and
(iii) any increase, or decrease (excluding any decrease to the extent resulting
from depreciation), in the net book value of the Acquired Assets, other than
Inventory, from capital expenditures, capital additions or capital improvements
to the Acquired Assets during the period beginning on November 1, 2010 and
ending on the Closing Date, as set forth in such Revised Net Book Value
Statement (or as set forth in the Revised Net Book Value Statement agreed to by
the Parties pursuant to the first sentence of Section 2.7(b), if resolution by
a Referee was not required), shall constitute the “Revised Net Book Value”.

                                   (e)          Purchase
Price Adjustment. Promptly, and in any event no later than the fifth (5th)
Business Day after final determination of the Revised Net Book Value in
accordance with this Section 2.7:

                                                  (i)           if
the Revised Net Book Value exceeds the Preliminary Net Book Value paid by the
Purchaser Parent at the Closing, then the Purchaser Parent shall pay such
excess amount to the Seller by wire transfer of immediately available funds to
an account designated in writing by the Seller; and

                                                  (ii)          if
the Revised Net Book Value is less than the Preliminary Net Book Value paid by
the Purchaser Parent at the Closing, then the Seller shall pay an amount equal
to such shortfall to the Purchaser Parent by wire transfer of immediately
available funds to an account designated in writing by the Purchaser Parent.

                                                  (iii)         Any
payment made by a Party pursuant to this Section 2.7(e) shall constitute an
adjustment to the Purchase Price.

          2.8          Prorated,
Prepayable and Reimburseable Items. Any amounts associated with items
listed on Schedule 2.8 (and such other items as may be determined by the
Parties as described in the last sentence of this Section 2.8) which were paid
by the Seller or are paid by the Purchaser in the Ordinary Course of Business
shall be prorated between the Purchaser and the Seller in accordance with GAAP
such that the Seller shall bear the cost and expense of such prorated items
applicable to periods ending on or before the Closing Date and shall receive
the benefits thereof, and the Purchaser and the Purchaser Parent shall bear the
cost and expense of such prorated items applicable to periods from and after
the Closing Date and shall receive the benefits thereof. Each of the Parties
agrees to reimburse the other Party for such costs and expenses as necessary to
effectuate such prorations. The Purchaser and the Seller each hereby agree to
use commercially reasonable efforts to determine the items to be prorated or
reimbursed and amounts of such prorations and reimbursements and to finalize Schedule
2.8 in good faith within thirty (30) days of the Closing Date. 

          2.9          Delivery
of the Acquired Assets. To the extent practicable, the Seller shall
deliver, and the Purchaser shall accept, the Acquired Assets through electronic
delivery or in another manner reasonably calculated and legally permitted to
minimize or avoid the incurrence of Transfer Taxes if such method of delivery
does not adversely affect the condition, operability or usefulness of any
Acquired Asset, does not diminish the value of an Acquired Asset, and does not
result in the creation or expansion of any Assumed Liability.

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ARTICLE III

REPRESENTATIONS AND WARRANTIES OF THE SELLER

          The Seller
represents and warrants to the Purchaser and the Purchaser Parent that the
statements set forth in this Article III are true, correct and complete as of
the date of this Agreement or such other date as may be referred to in any
particular representation and warranty, except as set forth in the disclosure
schedule delivered to the Purchaser Parent concurrently with the execution of
this Agreement (the “Disclosure Schedule”).
The Disclosure Schedule will be arranged in sections, subsections or clauses
corresponding to the numbered and lettered sections, subsections or clauses
contained in this Article III, and the disclosure in any such numbered and
lettered section of the Disclosure Schedule shall qualify only the
corresponding section and paragraph in this Article III (except to the extent
it is readily apparent from such disclosure that such disclosure is responsive
to another section, subsection or clause in this Article III, in which case
such disclosure shall also be deemed to qualify such other section, subsection
or clause in this Article III).

          3.1          Organization,
Standing and Power. The Seller is a corporation duly organized, validly
existing and in good standing under the laws of its jurisdiction of
organization. The Seller has all requisite corporate power to own, lease and
operate the Acquired Assets owned, leased or operated by it and, to carry on
the Business as now being conducted. The Seller is duly qualified or licensed
to do business and is in good standing in the State of California. The Seller
is not qualified to do business in any state or jurisdiction other than the
State of California with respect to the portion of its operations that
constitute the Business. The Seller is not in violation of any of the
provisions of its certificate of incorporation or bylaws in any manner that
would have a Business Material Adverse Effect.

          3.2          Authority.
The Seller has all requisite corporate power and authority to enter into the
Operative Agreements, to perform its obligations thereunder, and to consummate
the Contemplated Transactions. The execution and delivery of the Operative
Agreements, and the consummation of the Contemplated Transactions, have been
duly authorized by all necessary corporate action on the part of the Seller. No
vote of the holders of the shares of capital stock of the Seller is required to
approve the Seller’s execution of the Operative Agreements and the consummation
of the Contemplated Transactions by the Seller. This Agreement has been duly
executed and delivered by the Seller and constitutes the valid and binding
obligation of the Seller enforceable against the Seller in accordance with its
terms, except that such enforceability may be limited by bankruptcy,
insolvency, moratorium or other similar laws affecting or relating to
creditors’ rights generally, and is subject to general principles of equity.
The execution and delivery of this Agreement by the Seller does not, the
execution and delivery of the other Operative Agreements by the Seller will
not, and the consummation of the Contemplated Transactions will not, except as
set forth in Section 3.2 of the Disclosure Schedule, require any consent or
other action by any Person under, or conflict with, or result in any violation
of, or default under (with or without notice or lapse of time, or both), or
result in the triggering of any payment or other obligation under, or give rise
to a right of termination, cancellation or acceleration of any obligation or
loss of any benefit under, or result in the creation of any Lien in or upon any
of the Acquired Assets under, (i) any provision of the certificate of
incorporation or bylaws of the Seller, or (ii) any mortgage, indenture, lease,
contract or other agreement, 

-17-

obligation, commitment, arrangement, understanding or instrument to
which the Seller is a party, or any Legal Requirements applicable to the Seller
or any of the Acquired Assets, except as would not have a Business Material
Adverse Effect. No consent, approval, order or authorization of, or
registration, declaration or filing with, any Governmental Authority is or will
be required by or with respect to the Seller in connection with the execution
and delivery of the Operative Agreements or the consummation of the
Contemplated Transactions, except as would not have a Business Material Adverse
Effect.

          3.3          Financial
Statements. The Seller has delivered to the Purchaser complete and correct
copies of the pro forma statements of assets of the Business, pro forma
profit and loss statements of the Business and pro forma income statements of
the Business as of and for the twelve month period ended December 31, 2009 and
as of and for the six-month period ended June 30, 2010 (collectively, the “Financial Statements”). The Financial
Statements have been derived from the books and records of the Seller. The
Financial Statements are complete and correct in all material respects and
fairly present the financial condition and results of operations of the
Business as of the dates and for the periods indicated. 

          3.4          Absence
of Certain Changes.     (a) Since June 30, 2010
(the “Pro Forma Statement Date”),
the Seller has conducted the Business in the Ordinary Course of Business, and
there has not been:

                                        (i)          any
event, occurrence or development which, individually or in the aggregate, has
had or reasonably would be expected to have a Business Material Adverse Effect;

                                        (ii)         any
creation or assumption by the Seller of any Lien on any Acquired Asset;

                                        (iii)        any
revaluing in any material respect any of the Acquired Assets, including without
limitation writing down the value of any inventory included in the Acquired
Assets or writing off of accounts receivable included in the Acquired Assets
other than normal and customary depreciation of physical assets;

                                        (iv)        any
material change in any method of accounting or accounting principles or
practice by the Seller relating to the Business, except for any such change
required by reason of a change in GAAP;

                                        (v)         except
as specifically set forth in the Disclosure Schedule and other than the
implementation of the Seller’s current employee compensation related policies,
programs, and procedures for the Seller’s employees, including the employees of
the Seller employed with respect to the Business, any (i) grant of the right to
receive any severance, retention or termination pay to any current or former
officer or employee of the Business, (ii) entering into of any employment,
deferred compensation or other similar agreement (or any amendment to any such
existing agreement) with any current or former officer or employee of the
Business, (iii) increase or acceleration in vesting or benefits payable under
any existing severance or termination pay policies or employment agreements of
any officer or employee of 

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the Business or (iv) increase or acceleration in vesting or payment of
compensation, bonus or other benefits payable to current or former officers or
employees of the Business;

                                        (vi)           any
loss or termination of, or any material adverse change in relations with, any
customer or supplier of the Business that, individually or in the aggregate,
had resulted or would reasonably be expected to result in a Business Material
Adverse Effect;

                                        (vii)          any
action taken by or on behalf of the Seller since the date of the Environmental
Study which would reasonably be expected to incur any liability of $50,000 or
more under any applicable Environmental Law; 

                                        (viii)         any
action by or on behalf of the Seller which, if it had been taken after the date
hereof, would have required the consent of the Purchaser under Section 5.1
hereof; or

                                        (ix)           any
agreement to take any actions specified in this Section 3.4, except for this
Agreement.

                              (b)      The
Seller has not removed, disposed of or transferred any assets used exclusively
in the Business, other than inventory, from the Richmond Facility during the
six months prior to the date of this Agreement. 

          3.5          Litigation.
There is no Action pending before any Governmental Authority, or, to the
knowledge of the Seller, threatened against or affecting the Business or any of
the Acquired Assets or officers or employees of the Business (in their
capacities as such). There is no judgment, decree or order against the Seller
or any of its Affiliates or, to the knowledge of the Seller, any of its
directors or officers (in their capacities as such), relating to the Business
or the Acquired Assets. No Governmental Authority has indicated in writing an
intention to conduct any audit, investigation or other review with respect to
the Business or the Acquired Assets which investigation or review, if adversely
determined, individually or in the aggregate, would reasonably be expected to
have a Business Material Adverse Effect. 

          3.6          Restrictions
on Business Activities. There is no agreement, judgment, injunction, order
or decree binding upon the Seller which has or could reasonably be expected to
have the effect of prohibiting or materially impairing any current business
practice of the Seller with respect to the Business, the conduct of the
Business by the Seller as currently conducted by the Seller, or the conduct of
the Business by the Purchaser after the Closing in a manner consistent in all
material respects with the conduct of the Business by the Seller as currently
conducted except with respect to ownership of the Acquired Assets. 

          3.7          Intellectual
Property.

                              (a)      For
purposes of this Agreement, “Intellectual
Property” refers to the following, to the extent owned by the Seller
and exclusively relating to the current conduct of the Business:

                                        (i)             all
issued patents, reissued or reexamined patents, revivals of patents, renewals, continuations,
continuations-in-part, utility models, certificates of 

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invention, registrations of patents and extensions thereof, regardless
of country or formal name (collectively, “Issued
Patents”);

                                       (ii)          all
published or unpublished nonprovisional and provisional patent applications,
reexamination proceedings, invention disclosures and records of invention
(collectively “Patent Applications”
and, with the Issued Patents, the “Patents”);

                                       (iii)         all
copyrights and copyrightable works, including all rights of authorship, use,
publication, reproduction, distribution, performance transformation, moral
rights and rights of ownership of copyrightable works, semiconductor topography
works and mask works and all applications, registrations, and renewals relating
thereto, and all rights to register and obtain renewals and extensions of
registrations, copies and tangible embodiments of the foregoing (in whatever form
or medium) together with all other interests accruing by reason of
international copyright conventions (collectively, “Copyrights”);

                                       (iv)         all
trademarks, registered trademarks, applications for registration of trademarks,
service marks, registered service marks, applications for registration of
service marks, logos, trade names, registered trade names and applications for
registrations of trade names, trade dress, domain names, vanity numbers or
goodwill associated therewith, or translations, adaptations, derivations, and
combinations thereto regardless of the country, including, without limitation,
the “PerfectWave” trademark, which is not registered, and U.S. Trademark
Registration No. 3,181,179 (based on International Registration No. 0867299)
for the mark “ASML PerfectWave”, except for any of the foregoing which include
the ASML name other than ASML PerfectWave (collectively, the “Trademarks”);

                                       (v)          all
Confidential Information including technology, ideas, inventions, designs,
proprietary information, manufacturing and operating specifications, know how,
formulae, trade secrets, technical data, computer programs, hardware, software
and processes, drawings, customer and supplier lists, cost information and
marketing plans and proposals; and

                                       (vi)         all
other intangible assets, properties and rights (whether or not appropriate
steps have been taken to protect, under applicable law, such other intangible
assets, properties or rights).

                              (b)     With respect to each item of
Intellectual Property incorporated into any product of the Business
(collectively, the “Products”) or
otherwise used in the Business (except “off the shelf” or other software widely
available through regular commercial distribution channels at a cost not
exceeding $10,000 on standard terms and conditions, as modified for the
Business) (the “Business Intellectual
Property”), Section 3.7(b) of the Disclosure Schedule lists:

                                       (i)           all
Issued Patents and Patent Applications, all Trademarks and all registered
Copyrights and all mask works used in the Business as currently conducted, including
the jurisdictions in which each such item of Intellectual Property has been
issued or registered or in which any such application for such issuance and
registration has been filed; and

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                                         (ii)          the
following agreements relating to each of the Products or the Business
Intellectual Property: all (A) agreements granting any right to distribute or
sublicense a Product on any exclusive basis, (B) any exclusive or non-exclusive
licenses of Intellectual Property to or from the Seller, (C) agreements
pursuant to which the amounts actually paid or payable under firm commitments
to the Seller are $100,000 or more, (D) joint development agreements, (E) any
agreement by which the Seller grants any ownership right to any Business
Intellectual Property owned by the Seller, (F) any order relating to the
Business Intellectual Property and (G) any option relating to any Business
Intellectual Property, but in each case of items (A) through (G) excluding
development, cross-license or other agreements to which ASML NV or any of its
Affiliates other than the Seller is a party.

                              (c)       Section
3.7(c) of the Disclosure Schedule contains an accurate list of all licenses,
sublicenses and other agreements to which the Seller is a party and pursuant to
which the Seller is authorized to use any Intellectual Property owned by any
third party in the Business, excluding “off the shelf” or other software at a
cost not exceeding $10,000 and widely available through regular commercial
distribution channels on standard terms and conditions, but in each case
excluding development, cross-license or other agreements to which ASML NV or
any of its Affiliates other than the Seller is a party (“Third Party Intellectual Property”).

                              (d)       To
the Seller’s knowledge, there is no unauthorized use, disclosure, infringement
or misappropriation of any Business Intellectual Property, including any Third
Party Intellectual Property, by any third party, including any Employee of the
Business. Except as disclosed in Section 3.7(d) of the Disclosure Schedule, the
Seller has not entered into any agreement to indemnify any other Person against
any charge of infringement of any Intellectual Property. Except as disclosed in
Section 3.7(d) of the Disclosure Schedule, there are no agreements that require
the payment of royalties, fees or other payments payable by the Seller to any
Person by reason of the ownership, use, sale, assignment or disposition of
Products or Intellectual Property, including Business Intellectual Property and
Third Party Intellectual Property.

                              (e)       The
Seller is not in breach of any license, sublicense or other agreement relating
to the Business Intellectual Property or Third Party Intellectual Property
Rights. Neither the execution, delivery or performance of this Agreement or any
ancillary agreement contemplated hereby nor the consummation of the
Contemplated Transactions will breach any such agreement, contravene, conflict
with or result in an infringement on the Purchaser’s right to own or use any
Business Intellectual Property, including any Third Party Intellectual
Property. Neither the execution, delivery or performance of this Agreement or
any ancillary agreement contemplated hereby nor the consummation of the
Contemplated Transactions will require any payments to third parties and such
agreements will continue to be enforceable on identical terms following the
consummation of the Contemplated Transactions.

                              (f)       The
only Patents used in the Business are the Patents identified in Exhibit C to
the License and Support Agreement. All Patents, registered Copyrights and
registered Trademarks held by the Seller, to the extent used in the Business,
are owned by the Seller and enforceable, valid and subsisting. All maintenance
and annual fees with respect to such Intellectual Property have been fully paid
and all fees paid during prosecution and after issuance of any patent
comprising or relating to such item have been paid in the correct entity 

-21-

status amounts and no such fees will be due within six (6) months after
the Closing. To the knowledge of the Seller, the Seller is not infringing,
misappropriating or making unlawful use of in connection with the Business, and
the Seller has not received any notice or other communication (in writing or
otherwise) of any actual, alleged, possible or potential infringement,
misappropriation or unlawful use of in connection with the Business, any
Intellectual Property or other proprietary asset owned or used by any third
party. There is no Action pending or, to the knowledge of the Seller,
threatened nor has any written claim or demand been made, which challenges the
legality, validity, enforceability or ownership of any item of the Business
Intellectual Property or Third Party Intellectual Property or alleges a claim
of infringement of any Patents, Copyrights or Trademarks or violation of any
trade secret or other proprietary right of any third party. The Seller has not
brought an Action alleging infringement of the Business Intellectual Property
or breach of any license or agreement involving Intellectual Property against
any third party.

                              (g)       All
current and former officers and employees of the Seller who have or have had
access to proprietary information of the Business or have contributed to the
development of Business Intellectual Property have executed and delivered to the
Seller an agreement (containing no exceptions or exclusions from the scope of
its coverage) regarding the protection of such proprietary information and the
assignment to the Seller of any such Intellectual Property arising from
services performed for the Seller by such Persons, the form of which has been
supplied to the Purchaser. All current and former consultants and independent
contractors to the Seller involved in the development, modification, marketing
and servicing of the Products and/or the Business Intellectual Property have
executed and delivered to the Seller an agreement in the form provided to the
Purchaser (containing no exceptions or exclusions from the scope of its
coverage) regarding the protection of proprietary information and the assignment
to the Seller of any Intellectual Property arising from services performed for
the Seller with respect to the Business by such Persons. To the Seller’s
knowledge, no employee or independent contractor of the Seller is in violation
of any term of any patent disclosure agreement or employment contract or any
other contract or agreement relating to the relationship of any such employee
or independent contractor with the Seller. No current or former officer,
director, shareholder, employee, consultant or independent contractor has any
right, claim or interest in or with respect to any Business Intellectual
Property.

                              (h)       The
Seller has taken commercially reasonable and customary measures and precautions
necessary to protect and maintain the confidentiality of all the Business
Intellectual Property (except such the Business Intellectual Property whose
value would be unimpaired by public disclosure) and otherwise to maintain and
protect the full value of all Intellectual Property owned or used in connection
with the Business. All use, disclosure or appropriation of Intellectual
Property not otherwise protected by patents, patent applications or copyrights
owned by the Seller and relating to the Business by or to a third party is
subject to the terms of a written agreement between the Seller and such third
party. All use, disclosure or appropriation of Intellectual Property not owned
by the Seller and relating to the Business is subject to the terms of a written
agreement between the Seller and the owner of such Intellectual Property, or is
otherwise lawful.

                              (i)       The
Seller is not subject to any Action or outstanding decree, order, judgment or
stipulation restricting in any manner the use, transfer or licensing thereof by

-22-

the Seller, or which may affect the validity, use or enforceability of
such the Business Intellectual Property. The Seller is not subject to any
agreement which restricts in any material respect the use, transfer or
licensing by the Seller of the Business Intellectual Property or the Seller
Products.

                              (j)       To
the Seller’s knowledge, other than the Business Intellectual Property, Third
Party Intellectual Property and Intellectual Property licensed to ASML pursuant
to development, cross license or other agreements to which the Seller, its
parent or any Affiliate are a party (collectively, the “Necessary Intellectual Property”),
no Intellectual Property is necessary to operate the Business. The Seller has
not disposed of any Necessary Intellectual Property during the six months prior
to the date of this Agreement.

          3.8          Material
Contracts. 

                              (a)       True,
correct and complete copies of each Assumed Contract have been delivered to the
Purchaser.

                              (b)       With
respect to each Assumed Contract: (i) the agreement is legal, valid, binding
and enforceable and in full force and effect with respect to the Seller, and to
the Seller’s knowledge is legal, valid, binding, enforceable and in full force
and effect with respect to each other party thereto, in either case subject to
the effect of bankruptcy, insolvency, moratorium or other similar laws
affecting the enforcement of creditors’ rights generally and except as the
availability of equitable remedies may be limited by general principles of
equity; (ii) the agreement will continue to be legal, valid, binding and
enforceable and in full force and effect immediately following the Closing in
accordance with the terms thereof as in effect prior to the Closing, subject to
the effect of bankruptcy, insolvency, moratorium or other similar laws
affecting the enforcement of creditors’ rights generally and except as the
availability of equitable remedies may be limited by general principles of
equity; (iii) the Seller has performed all the obligations required to be
performed by it and is entitled to all benefits thereunder; and (iv) neither
the Seller nor, to the Seller’s knowledge, any other party is in breach or
default, and no event has occurred which with notice or lapse of time would
constitute a breach of default by the Seller or, to the Seller’s knowledge, by
any such other party, or permit termination, modification or acceleration,
under the agreement. 

          3.9          Title
to Acquired Assets. 

                              (a)       The
Seller has good and marketable title to all of the Personal Property included
in the Acquired Assets free and clear of all Liens, except for Permitted Liens.
The Seller is in possession of all of the Personal Property, all of which is
located at the Richmond Facility. At the Closing, the Purchaser will obtain
from the Seller good and marketable title to the owned Personal Property
included in the Acquired Assets free and clear of all Liens, except for
Permitted Liens. None of the Personal Property included in the Acquired Assets
are owned or leased by any Person other than the Seller. 

                              (b)       The
Personal Property included in the Acquired Assets is in all material respects
in good operating condition and repair, subject to normal wear and tear not
caused by neglect.

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          3.10          Real
Property.

                                   (a)          Section
3.10 of the Disclosure Schedule identifies all interests in real property
including land and improvements owned by the Seller which are used by the Seller
in the conduct of the Business at the Richmond Facility as of the date hereof
(the “Owned Real Property”). There
are no tenants, subtenants, licensees, occupants or other parties in possession
of all or any portion of the Owned Real Property other than the Seller. Neither
the Seller nor any Affiliate of the Seller leases, subleases, licenses or
otherwise occupies or uses any real property (or interest therein) in
connection with the Business except for the Owned Real Property.

                                   (b)          The
Seller holds and at the Closing will convey to the Purchaser, good, valid and
marketable fee title to the Owned Real Property, free and clear of all Liens
whatsoever except for Permitted Liens.

                                   (c)          Except
as set forth in Section 3.10(c) of the Disclosure Schedule, to the Seller’s
knowledge, all buildings, structures, improvements, facilities, fixtures, all
material components of all buildings, structures, landscaping, and other
improvements included within the Owned Real Property, including, but not
limited to, the roofs and structural elements thereof, shrubbery and the
ventilation, air conditioning, plumbing, electrical, mechanical, sewer, waste
water, storm water, paving and parking equipment, systems and facilities
included therein (collectively, the “Improvements”)
are in good operating condition and repair, subject to normal wear and tear,
given their relative ages, and are usable in the Ordinary Course of Business,
and no maintenance, repair or replacement thereof has knowingly been deferred.
There are no unsatisfied written requests for any repairs, restorations or
improvements to the Owned Real Property and Improvements from any Governmental
Authority, there are no ongoing repairs to the Owned Real Property and
Improvements being made by or on behalf of the Seller, and all repairs for
which payment is due have been paid for. No portion of the Owned Real Property
has suffered any material damage by fire, earthquake or other casualty which
heretofore has not been repaired and restored. No Person other than the Seller
owns any Improvements necessary to the operation of the Business.

                                   (d)          The
use and operation of the Owned Real Property and Improvements in the manner
currently operated is lawful and is in compliance with all use laws, statutes,
rules, regulations, ordinances, orders, writs, injunctions, judgments, decrees,
awards and restrictions, including, without limitation, zoning and land use
laws (collectively, “Use Laws”) of
every Governmental Authority having jurisdiction over such Owned Real Property
and Improvements. The use and operation of the Improvements and the Owned Real
Property in the manner currently operated by the Seller are lawful and in
compliance with all Legal Requirements, including, without limitation, all laws
relating to the construction and safety of the Improvements and access thereto
by the handicapped (such laws, collectively with the Use Laws, “Real Property Laws”) of every Governmental
Authority having jurisdiction. The Seller has not received any written notice
of any uncured violation of or pending investigation regarding any Real
Property Laws with respect to the Owned Real Property. The Seller has provided
to the Purchaser copies, if in the possession of the Seller or any of its
Affiliates, of (i) the most recent title reports relating to the Owned Real
Property and all title insurance policies currently in effect with respect to
the Owned Real Property, (ii) all as-built surveys, site plans and recorded
plats relating to the Owned Real Property and/or the Improvements, (iii) every
engineering review and 

-24-

inspection, geotechnical report, environmental site assessment or other
environmental document (including Phase I and Phase II reports), health
inspection report, license, permit, or similar document and contract relating
to the Owned Real Property and/or the Improvements, (iv) all plans,
specifications and other drawings relating to the Owned Real Property and/or
the Improvements, including building specifications and certificate of
occupancy, (v) all materials submitted by the Seller to Governmental
Authorities in connection with the development, operation or zoning of the
Owned Real Property and/or the Improvements, and (vi) the most recent property
tax assessments and bills for the last three (3) years.

                                   (e)          The
Seller has not received written notice of, and does not otherwise have
knowledge of, any pending or threatened condemnation, fire, health, safety,
building, zoning or other land use regulatory proceeding, which would have a
Business Material Adverse Effect or materially impair the use and operation of
any portion of the Owned Real Property and/or Improvements as currently
conducted in connection with the Business or the value of any material portion
of the Owned Real Property or Improvements, nor has the Seller received written
notice of any special improvements, Liens, assessments or pending assessment
proceedings affecting any of the Owned Real Property or Improvements, nor has
the Seller received any written notice of uncured violation or pending claimed
violation, in any material respect, of any Real Property Law with respect to
the Owned Real Property.

                                   (f)          All
water, sewer, gas, electric, telephone and drainage facilities, and all other
utilities required by any applicable Legal Requirements or by the current use
and operation of the Owned Real Property and Improvements are installed to the
property lines of the Owned Real Property, connected pursuant to valid permits
to municipal or public utility services or proper drainage facilities, to
service the Owned Real Property and Improvements as currently used in the
operation of the Business. The Seller does not have knowledge or written notice
of any fact or condition which could result in the termination or material
reduction of the current access from the Owned Real Property to existing roads
or to sewer or other utility services presently serving the Owned Real
Property.

                                   (g)          All
licenses, permits, certificates (including, without limitation, certificates of
occupancy), easements and rights of way, including proof of dedication,
required from all Governmental Authorities having jurisdiction over the Owned
Real Property for the use and operation of the Owned Real Property and
Improvements as currently used in the operation of the Business and to ensure
vehicular and pedestrian ingress to and egress from the Owned Real Property
have been obtained, except where the failure to obtain any such license,
permit, certificate, easement or right of way would not have a Business
Material Adverse Effect or materially impair the value or current use of the
Owned Real Property in connection with the Business.

                                   (h)          The
Seller has not granted any easements or entered into any arrangement or
agreement affecting rights to the Owned Real Property, except those of record.

          3.11          Environmental
Matters.

                                   (a)          Except
as would not have an Environmental Material Adverse Effect:

-25-

                                        (i)          The
Seller is and has been in compliance with all restrictions, standards and
obligations established under applicable Environmental Laws relating to the
Owned Real Property and Improvements (each, an “Applicable Property”). 

                                        (ii)         During
the period of ownership or operation by the Seller of any Applicable Property,
and, to the Seller’s knowledge, prior to the period of such ownership or
operation, no Hazardous Material has been treated or disposed of, and there
have been no Releases or threatened Releases of Hazardous Material at, in, on,
under or affecting any such Applicable Property or any contiguous site that may
or will give rise to any Environmental Liabilities or that may be imposed upon
the Seller or any purchaser of the Acquired Assets under Environmental Laws a
requirement to remediate any Applicable Property.

                                        (iii)        Section
3.11(a)(iii) of the Disclosure Schedule identifies all Environmental Permits
necessary to operate the Applicable Properties in all material respects in the
manner they are currently operated, all such Environmental Permits have been
duly obtained or filed and are in full force and effect, and the Seller is in
compliance with such Environmental Permits.

                                        (iv)        No
employee of the Seller or other Person has claimed that the Seller is liable
for alleged injury or illness resulting from an alleged exposure to a Hazardous
Material at any Applicable Property.

                                        (v)         No
Action against the Seller or its Affiliates is pending or, to the Seller’s
knowledge, threatened against the Seller, with respect to Hazardous Materials
or Environmental Laws, and the Seller is not aware of any facts or
circumstances which could form the basis for assertion of a claim against the
Seller or which could form the basis for any Environmental Liabilities to be
asserted against the Seller or any purchaser of the Acquired Assets, regarding
the Release of any Hazardous Materials or regarding actual or potential
noncompliance with Environmental Laws at any Applicable Property.

                                        (vi)        The
Seller has not received any written notice of, or entered into or assumed by
contract, judicial or administrative settlement, or operation of law any
indemnification obligation, order, settlement or decree relating to: (1) any
violation of any Environmental Laws or the institution or pendency of any
Action by any Governmental Authority or any third party in connection with any
alleged violation of Environmental Laws or any Release of Hazardous Materials
at any Applicable Property, (2) the response to or remediation of Hazardous
Material at any Applicable Property or arising from the Seller’s activities at
any Applicable Property or (3) payment for any response action relating to or remediation
of Hazardous Material at any Applicable Property or arising from any of the
Seller’s activities at any Applicable Property.

                              (b)     The
Seller has provided to the Purchaser copies of any reports, data, summaries,
correspondence, or similar documents in its possession reflecting the
Environmental Condition of any Applicable Property and any violations of
Environmental Law known to the Seller that have not been remedied.

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                                   (c)          The
Seller has delivered to the Purchaser a Phase II environmental site assessment,
dated September 14, 2010, prepared by URS Corporation (the “Environmental Study”).

          3.12          Taxes.

                                   (a)          The
Seller has properly prepared and timely filed all Tax Returns required to be
filed which reflect any income from or attributable to the Business or the
ownership of the Acquired Assets, such Tax Returns are true and correct in all
material respects and the Seller has paid all Taxes shown thereon as owing to
the extent of income from or attributed to the Business or the ownership of the
Acquired Assets.

                                   (b)          There
are no Liens for Taxes on any of the Acquired Assets, except for Liens for
Taxes not yet due and payable, and the Seller has taken no action, and has not
failed to take any action, which could result in the Acquired Assets becoming
subject to any Lien for unpaid Taxes.

                                   (c)          To
the knowledge of the Seller, no action, suit, proceeding, or audit regarding
Taxes is pending against the Seller with respect to the Business or the
ownership of the Acquired Assets.

                                   (d)          To
the extent related to the Acquired Assets or the Business, or to the extent the
Purchaser could have successor liability, the Seller is not and has never been
a party to any Tax allocation agreement, Tax sharing agreement or similar
arrangement with any other party, and the Seller has not assumed any Tax
obligations of, or with respect to any transaction relating to, any other
Person or agreed to indemnify any other Person with respect to any Tax, that
could result in a Lien being placed on the Acquired Assets.

                                   (e)          To
the extent related to the Acquired Assets, the Business or to the extent the
Purchaser or the Purchaser Parent would have successor liability, the Seller
has complied in all material respects with all applicable laws, rules and
regulations relating to the payment and withholding of Taxes and have duly and
timely withheld from employee salaries, wages and other compensation and have
paid over to the appropriate taxing authorities all amounts required to be so
withheld and paid over for all periods under all applicable laws.

          3.13          Employees.

                                   (a)          The
Seller has furnished to the Purchaser Parent a schedule setting forth a true,
correct and complete list of each Person currently employed by the Seller in
the Business (individually, an “Employee” and collectively, the “Employees”) and, with respect to each such
Employee, (i) the amount of salary currently being paid on a gross annualized
basis, the hourly pay rate (if applicable) of such Employee and the amount of
compensation paid in the twelve months ended June 30, 2010 and June 30, 2009;
(ii) the material terms of any employment or similar agreement with such
Employee; and (iii) the nature and amount of any perquisites or personal benefits
currently being provided to or for the account of such Employee, other than the
employee benefit plans of general application. The Seller is not in default in
any material respect of any of the foregoing obligations and the Seller will
bear full responsibility for any such obligations outstanding or due, owing or
accrued prior to the Closing Date (including, 

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for the avoidance of doubt, under any employee benefit plans of general
application). The Seller has also furnished to the Purchaser Parent a true,
correct and complete list of individuals who are (A) “leased employees” of the
Business within the meaning of Section 414(n) of the Code or (B) “independent
contractors” of the Business within the meaning of the Code and the rules and
regulations promulgated thereunder, and in each case, the amount paid by the
Seller during the twelve months ended June 30, 2010 and July 30, 2009 and the
hourly pay rate or other compensatory arrangements with respect to each such
Person.

                                   (b)          To
the knowledge of the Seller, no Employee is a party to any Confidential
Information or other agreement that in any way restricts the ability of such
Employee to perform his or her duties for the Seller.

                                   (c)          The
Seller has complied, with respect to the Business, in all material respects
with all laws, rules and regulations relating to the employment of labor,
including provisions thereof relating to wages, hours, meal periods and rest
breaks, equal opportunity, collective bargaining, nondiscrimination,
harassment, and the payment of social security and other Taxes. There are no
pending or, to the knowledge of the Seller, threatened charges of unfair labor
practices, employment discrimination or other wrongful action with respect to
any aspect of employment of any Person employed by the Seller in the Business.
All Persons who have performed services for the Seller in connection with the
Business and have been classified as independent contractors have, to the
knowledge of the Seller, satisfied the requirements of all laws to be so
classified and, as applicable, the Seller has fully and accurately reported
their compensation on IRS Forms 1099 or other applicable tax forms for
independent contractors when required to do so.

                                   (d)          There
are no Actions pending or, to the knowledge of the Seller, threatened, between
the Seller, on the one hand, and any current or former Employee, on the other
hand, including any claims for actual or alleged harassment or discrimination
based on race, national origin, age, sex, sexual orientation, religion,
disability, or similar tortuous conduct, wage and hour claims, breach of
contract, wrongful termination, defamation, intentional or negligent infliction
of emotional distress, interference with contract or interference with actual
or prospective economic advantage. There are no claims pending, against the
Seller under any workers’ compensation or long term disability plan or policy
applicable to any current Employee.

                                   (e)          The
Seller is not a party to, or bound in any manner by, any collective bargaining
agreement contract, or other agreement of understanding with a labor or trade
union, labor organization, staff association or works council, or similar
grouping of employee representations with respect to the Business, and the
Seller has no knowledge of any activities or proceedings of any labor union to
organize the Employees by any Person, unit or group seeking to act as their
bargaining agent. To the knowledge of the Seller, no union representation
elections relating to the Employees have been scheduled by any Governmental
Authority and no investigation of the employment policies or practices of the
Seller by any Governmental Authority is pending or threatened. There has not
been over the last three (3) years any labor strike, slowdown or work stoppage
or lockout by Employees.

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                                   (f)          The
Seller has provided all Employees with all wages, benefits, relocation
benefits, stock options, bonuses and incentives and all other compensation
which became due and payable through the date of this Agreement. The Seller has
not instituted any “freeze” of, or delayed or deferred the grant of, any
cost-of-living or other salary adjustments for any of the Employees. 

                                   (g)          The
Seller is not in default in any material respect with respect to any (a)
contributions or material obligations under any Employee Plan or (b)
withholding or other employment Taxes or payments on behalf of any current or
former Employee.

                                   (h)          The
Seller does not currently employ, and has not employed within the preceding
twelve months, 75 or more persons at the Richmond Facility and is not required
to comply with the notice requirements of the California Worker Adjustment and
Retraining Notification Act.

          3.14          Employee
Plans.

                                   (a)          With
respect to the current Employees, the Seller has not incurred nor may incur,
directly or indirectly, any liability or obligation under Title IV of ERISA
with respect to any “employee pension plan” (within the meaning of Section 3(2)
of ERISA), including, without limitation, any multiemployer plan described in
Section 3(37) of ERISA. No lien has been imposed on the Acquired Assets
pursuant to Section 302, 303 or Title IV of ERISA or Section 412 or 430 of the
Code and no fact exists that would reasonably be expected to give rise to such
lien. The Seller has not contributed to or had an obligation to contribute to a
multiemployer plan as described in Section 3(37) of ERISA with respect to any
individuals who may become Transferred Employees. 

                                   (b)          No
Employee Plan provides to individuals who may become Transferred Employees (or
such Transferred Employees’ eligible dependants) for continuing benefits or
coverage for any participant or any beneficiary of a participant after such
participant’s termination of employment, except as may be required by COBRA or
any similar state law at such participant’s or such beneficiary’s expense. The
requirements of section 4980B of the Code and Part 6 of Subtitle B of Title I
of ERISA relating to COBRA continuation of health coverage have been
substantially satisfied with respect to each Employee Plan in which a
Transferred Employee Participates that is subject to such requirements. As of
the Closing Date, all contributions (including all premiums, employer
contributions and employee salary reduction contributions) required to be made
to, under or with respect to each Employee Plan with respect to individuals who
may become Transferred Employees (and their dependents and beneficiaries) will have
been made.

                                   (c)          No
Employee who may become a Transferred Employee is covered by an Employee Plan
that is subject to the laws of, or maintained primarily for the benefit of
employees whose principal employment is located in, a country other than the
United States.

          3.15          Insurance.
The Seller carries property, liability, workers’ compensation and such other
types of insurance with respect to the Business pursuant to the insurance
policies listed and 

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briefly described in Section 3.15 of the Disclosure Schedule
(collectively, the “Insurance Policies”).
The Insurance Policies cover such risks and contain such policy limits, types
of coverage and deductibles as are, in the Seller’s judgment, adequate to
insure fully (subject to the deductibles and retention amounts described in
Section 3.15 of the Disclosure Schedule) against risks to which the Business
and its employees, business, properties and other assets may be exposed in the
operation of the Business as currently conducted. Section 3.15 of the
Disclosure Schedule sets forth a list of all claims under any such Insurance
Policy in excess of $50,000 per occurrence filed by or on behalf of the Seller
relating to the Business (including any Closing Date Employee) since June 30,
2009. There is no material claim pending under any of such policies or bonds as
to which coverage has been questioned, denied or disputed by the underwriters
of such policies or bonds. All of such Insurance Policies are valid and
enforceable policies, all premiums due and payable under all such policies and
bonds have been paid and the Seller is otherwise in compliance in all material
respects with the terms of such policies and bonds. The Seller has no knowledge
of any threatened termination of, or material premium increase with respect to,
any of such policies.

          3.16          Licenses
and Permits. The Seller has obtained each federal, state, county, local or
foreign governmental consent, license, permit, grant or other authorization of
a Governmental Authority (i) pursuant to which the Seller currently operates or
holds any interest in any of the Acquired Assets or (ii) that is required for
the operation of the Business, the current operation and use of the Owned Real Property
and the Improvements or the holding of any of the Acquired Assets by the Seller
(collectively, “Permits”), all of
which are listed (with expiration dates, if applicable) on Section 3.16 of the
Disclosure Schedule, and all of such Permits are in full force and effect,
except where the failure to obtain or have any such authorizations could not
reasonably be expected to have a Business Material Adverse Effect. No Permit is
subject to revocation or forfeiture by virtue of any existing circumstances, there
is no Action pending or, to the knowledge of the Seller, threatened to modify
or revoke any Permit, and no Permit is subject to any outstanding order,
decree, judgment, stipulation or, to the knowledge of the Seller, investigation
that would reasonably be likely to materially adversely affect such Permit.

          3.17          Compliance
With Laws. The Seller has complied in all material respects with, is not in
violation in any material respect of and has not received any written notices
of violation with respect to, any Legal Requirement with respect to the
ownership or operation of the Business or the Acquired Assets. To the knowledge
of the Seller, no investigation or review by any Governmental Authority
(including without limitation any audit or similar review by any federal,
foreign, state or local taxing authority) with respect to the ownership and
operation of the Business or the Acquired Assets is pending or threatened, nor
has any Governmental Authority indicated in writing to the Seller an intention
to conduct the same.

          3.18          Certain
Business Practices. To the knowledge of the Seller, no Closing Date
Employee has (i) used any funds for unlawful contributions, gifts,
entertainment or other unlawful expenses relating to political activity, (ii)
made any unlawful payment to foreign or domestic government officials or
employees or to foreign or domestic political parties or campaigns or violated
any provision of the Foreign Corrupt Practices Act of 1977, as amended, or
(iii) made any other unlawful payment.

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          3.19          Suppliers
and Customers.

                                   (a)          The
Seller has furnished to the Purchaser a schedule setting forth a true, correct
and complete list, for the 12-month periods ended June 30, 2010 and June 30,
2009, the names of (i) the top twenty (20) customers, as determined by revenue,
of the Business, and the amount of revenues generated by each such customer in
each such period and (ii) each supplier that accounted for more than $50,000 of
the operating expenses of the Business during any such period.

                                   (b)          The
Seller has not received any written or, to its knowledge, oral notice that any
customer or supplier identified on the schedule referred to in Section 3.19(a)
has canceled or otherwise terminated, or to the Seller’s knowledge threatened
to cancel or terminate, its relationship with the Business, or to the Seller’s
knowledge threatened to decrease or limit materially, its business done with
the Business, and, except as set forth on such schedule, the Seller has no
reason to believe that any such customer or supplier would not continue its
business relationship in respect of the Business with the Purchaser following
the Closing on substantially the same terms as such customer or supplier has
heretofore done business with the Seller in respect of the Business.

          3.20          Brokers’
and Finders’ Fee. No broker, finder or investment banker engaged by the
Seller or its Affiliates is entitled to brokerage or finders’ fees or agents’
commissions or investment bankers’ fees or any similar charges for which the
Purchaser or the Purchaser Parent would be liable or which would be payable by
the Purchaser or the Purchaser Parent in connection with this Agreement or the
Contemplated Transactions.

ARTICLE IV

REPRESENTATIONS AND WARRANTIES OF THE PURCHASER AND THE 

PURCHASER PARENT

          The
Purchaser and the Purchaser Parent represent and warrant to the Seller, jointly
and severally, that the statements set forth in this Article IV are true and
correct as of the date of this Agreement or such other date as may be referred
to in any particular representation and warranty:

          4.1          Organization,
Standing and Power. Each of the Purchaser and the Purchaser Parent is a
corporation duly organized, validly existing and in good standing under the
laws of its jurisdiction of organization. Each of the Purchaser and the
Purchaser Parent has all requisite corporate power to own, lease and operate
its properties and to carry on its business, if any, as now being conducted and
is duly qualified or licensed to do business and is in good standing in each
jurisdiction in which the nature of its business or the ownership, leasing or
operation of its properties makes such qualification or licensing necessary,
except where the failure to be so qualified and in good standing would not have
a Purchaser Material Adverse Effect. Each of the Purchaser and the Purchaser
Parent has delivered to the Seller a true and correct copy of its certificate
of incorporation and bylaws, each as amended to date, and such certificates of
incorporation and bylaws are in full force and effect. Neither the Purchaser
nor the Purchaser Parent is in violation of any of the provisions of its
certificate of incorporation or bylaws.

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          4.2          Authority.
Each of the Purchaser and the Purchaser Parent has all requisite corporate
power and authority to enter into the Operative Agreements to which it is a
party, to perform its obligations thereunder, and to consummate the
Contemplated Transactions. The execution and delivery of the Operative
Agreements, and the consummation of the Contemplated Transactions, have been
duly authorized by all necessary corporate action on the part of each of the
Purchaser and the Purchaser Parent. No vote of the holders of the shares of
capital stock of the Purchaser Parent is required to approve the Purchaser
Parent’s execution of the Operative Agreements and the consummation of the Contemplated
Transactions. This Agreement has been duly executed and delivered by the
Purchaser and the Purchaser Parent, and constitutes the valid and binding
obligation of the each of the Purchaser and the Purchaser Parent, enforceable
against each such Party in accordance with its terms, except that such
enforceability may be limited by bankruptcy, insolvency, moratorium or other
similar laws affecting or relating to creditors’ rights generally, and is
subject to general principles of equity. The execution and delivery of this
Agreement by the Purchaser and the Purchaser Parent does not, the execution and
delivery of the other Operative Agreements to which it is a Party by the
Purchaser and the Purchaser Parent will not, and the consummation of the Contemplated
Transactions will not, require any consent or other action by any Person under,
or conflict with, or result in any violation of, or default under (with or
without notice or lapse of time, or both), or result in the triggering of any
payment or other obligation under, or give rise to a right of termination,
cancellation or acceleration of any obligation or loss of any benefit under, or
result in the creation of any Lien in or upon any material assets of the
Purchaser or the Purchaser Parent under, (i) any provision of the certificate
of incorporation or bylaws of the Purchaser or the Purchaser Parent, or (ii)
any material mortgage, indenture, lease, contract or other agreement,
obligation, commitment, arrangement, understanding or instrument to which the
Purchaser or the Purchaser Parent is a party, or any Legal Requirements
applicable to the Purchaser or the Purchaser Parent, except as would not have a
Purchaser Material Adverse Effect. No consent, approval, order or authorization
of, or registration, declaration or filing with, any Governmental Authority is
or will be required by or with respect to the Purchaser or the Purchaser Parent
in connection with the execution and delivery of the Operative Agreements or
the consummation of the Contemplated Transactions, other than the filing of the
deed of transfer referred to in Section 6.2(f)(iii) in the appropriate real
property recording office and except as would not have a Purchaser Material
Adverse Effect.

          4.3          Financing.
The Purchaser Parent and Purchaser have readily available to them sufficient
funds to pay the Purchase Price under this Agreement.

          4.4          Litigation.
There is no Action pending before any Governmental Authority, or, to the
knowledge of the Purchaser or the Purchaser Parent, threatened against or
affecting the Purchaser or the Purchaser Parent or officers or employees of
either the Purchaser or the Purchaser Parent (in their capacities as such)
which would reasonably be expected to prevent the consummation of the
transactions contemplated by the Operative Agreements. There is no judgment,
decree or order against the Purchaser, the Purchaser Parent or any of their
Affiliates or, to the knowledge of the Purchaser or the Purchaser Parent, any
of their directors or officers (in their capacities as such) which would
reasonably be expected to prevent the consummation of the transactions
contemplated by the Operative Agreements. No Governmental Authority has
indicated in writing an intention to conduct any audit, investigation or other
review of the Purchaser or the Purchaser Parent which investigation or review,
if adversely determined, 

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individually or in the aggregate, would reasonably be expected to
prevent the consummation of the transactions contemplated by the Operative
Agreements.

          4.5          Brokers’
and Finders’ Fee. No broker, finder or investment banker engaged by the
Purchaser, the Purchaser Parent or their Affiliates is entitled to brokerage or
finders’ fees or agents’ commissions or investment bankers’ fees or any similar
charges in connection with this Agreement or the Contemplated Transactions.

ARTICLE V

CONDUCT PRIOR TO THE CLOSING

          5.1          Conduct
of the Business. During the period from the date of this Agreement and continuing
until the earlier of the termination of this Agreement or the Closing Date, the
Seller agrees (except to the extent expressly contemplated by this Agreement or
as consented to in writing by the Purchaser Parent, which consent shall not be
unreasonably withheld or delayed), to use commercially reasonable efforts to
carry on the Business in the Ordinary Course of Business in substantially the
same manner as heretofore conducted, and in compliance in all material respects
with all applicable Legal Requirements, to pay or perform its obligations when
due and to use commercially reasonable efforts to preserve intact the present
business organization of the Business, keep available the services of its
present employees of the Business and preserve in all material respects its
relationships with customers, suppliers, distributors, licensors, licensees and
others having business dealings with the Business to the end that the goodwill
of the Acquired Assets and the continued operation of the Acquired Assets shall
be unimpaired at the Closing Date. Without limiting the foregoing, except as
expressly contemplated by this Agreement or the Disclosure Schedule, the Seller
shall not do or cause to be done any of the following, without the prior
written consent of the Purchaser Parent, which consent shall not be
unreasonably withheld or delayed:

                                   (a)          Intellectual
Property. Transfer to any Person any rights to its Intellectual Property
included in the Acquired Assets;

                                   (b)          Intellectual
Property Rights. Amend or enter into any agreement, whether or not an
Assumed Contract, pursuant to which any other party is granted rights of any
type or scope with respect to the Intellectual Property included in the
Acquired Assets;

                                   (c)          Dispositions.
Sell, lease, license or otherwise dispose of or encumber any of the Acquired
Assets, other than sales of inventory in the ordinary course of business and
disposition of obsolete inventory in the Ordinary Course of Business;

                                   (d)          Liens.
Permit the incurrence of any Lien, other than Permitted Liens, on the Acquired
Assets;

                                   (e)          Agreements.
Enter into, terminate or amend, or otherwise modify or waive any of the terms
in a manner which will adversely affect the Business, any Assumed Contract;

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                                   (f)          Capital
Expenditures. Make any material capital expenditures, capital additions or
capital improvements to the Acquired Assets; 

                                   (g)          Insurance.
Materially reduce the amount of any insurance coverage provided by existing
insurance policies which insure the Business or the Acquired Assets;

                                   (h)          Employee
Plans and Compensation. With respect to Employees who will become
Transferred Employees, increase their base salaries under any Employee Plan or
otherwise, other than as part of any adjustments applicable generally to
employees of the Seller; 

                                   (i)          Termination
or Waiver. Terminate or waive any right of substantial value that is
included in the Acquired Assets;

                                   (j)          Acquisitions.
Acquire or agree to acquire by merging or consolidating with, or by purchasing
a substantial portion of the assets of, or by any other manner, any business or
any Person or division thereof, make any investment in any other Person or
otherwise acquire or agree to acquire any assets which are material,
individually or in the aggregate, to the Business;

                                   (k)          Taxes.
With respect to the Acquired Assets or the Business:

                                                  (i)          make
or change any election in respect of Taxes;

                                                  (ii)         adopt or change any accounting method
in respect of Taxes or file any amendment to a Tax Return;

                                                  (iii)        enter into any closing agreement;

                                                  (iv)        settle any claim or assessment in
respect of Taxes; or

                                                  (v)         consent to any extension or waiver of
the limitation period applicable to any material claim or assessment in respect
of Taxes.

                                   (l)          Revaluation.
Except as required by GAAP, revalue any of the Acquired Assets, including
without limitation writing down the value of inventory;

                                  (m)         Environmental
Matters. Take any action with respect to the Business or the Acquired
Assets which would reasonably be expected to incur any liability for Purchaser
in excess of $50,000 under any applicable Environmental Law; or

                                   (n)         Other.
Agree or commit to take any of the actions described in Sections 5.1(a) through
(m) above, or take or agree or commit to take any action that would cause the
conditions set forth in Section 6.1 or 6.2 not to be satisfied or that would
reasonably be expected to prevent, impair or materially delay the ability of
any of the Parties to consummate the transactions contemplated by this
Agreement.

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          5.2          Title
Insurance.

                                   (a)          As
soon as practicable after the date hereof, the Purchaser and the Purchaser
Parent shall obtain a binding commitment (the “Commitment”) for the issuance of a then current fee owners
extended coverage title insurance policy, either on the current ALTA form or in
such other form as may be reasonably acceptable to the Purchaser Parent and its
counsel (together with such endorsements as the Purchaser Parent may deem
appropriate, the “Title Policy”), insuring title to each
parcel of Owned Real Property and the Improvements in the Purchaser as
prospective fee simple owner from a nationally recognized title insurance
company selected by the Purchaser Parent (the “Title Insurer”) such that such Owned Real Property and
Improvements shall be insured as of the Closing and no lapse in insurance
coverage of such Owned Real Property and Improvements shall occur. The
Purchaser Parent shall deliver a true, correct and complete copy of the Commitment
to the Seller as soon as practicable after obtaining such Commitment. In
addition, the Purchaser Parent shall obtain a survey of the Owned Real Property
made by a registered land surveyor bearing a certificate addressed to the
Purchaser, such other Persons that may be designated by the Purchaser Parent,
and the Title Insurer, signed by the surveyor, certifying that the survey was
actually made on the ground and that there are no encroachments except as
shown, and complying with the then current minimum detail requirements for
ALTA/ACSM and land title surveys as adopted by the American Land Title
Association and the American Congress on Surveying and Mapping, and shall
include the following Additional Survey Requirements shown on Table A thereof:
Item No. 1, Item No. 2, Item No. 3, Item No. 6, Item No. 7(a), Item No.
7(b)(1), Item No. 8, Item No. 9, Item No. 10, Item No. 11(a), Item No. 13, Item
No. 14, Item No. 15, and Item No. 16, and providing sufficient detail to enable
the Title Insurer to issue the Title Policy without the general exception for
survey matters (the “Survey”).
Without limitation of the foregoing, the Survey shall show the following items
(whether covered by the minimum detail requirements specified above or not):
(i) all courses and distances of the boundaries and the legal description of
the Owned Real Property; (ii) the location and dimensions of all improvements
located on the Owned Real Property and their relation to lot lines, set back
and building line requirements (whether such requirements are imposed by law,
recorded deed or recorded plat); (iii) the location of all rights of way, water
courses and easements serving or existing on the Owned Real Property; and (iv)
all easements or restrictions contained within the Commitment including those
which burden the Owned Real Property along with the improvements thereon and
the limits of those off-site easements which benefit the Owned Real Property
without improvements thereon. The Survey shall reference the most recent
Commitment and cross-reference the easements noted by keying in the exception
number allocated in the Commitment.

                                   (b)          The
Purchaser Parent shall pay all premiums, fees, costs and other expenses
relating to the Commitment, Title Policy and Survey. 

                                   (c)          Within
ten (10) Business Days following the Purchaser Parent’s receipt of a copy of
the Commitment and the documents of record reflected therein, the Purchaser
shall give written notice (the “Objection
Notice”) to the Seller of any material conditions of title which are
not reasonably acceptable to the Purchaser (the “Objections”). The Seller shall give the Purchaser notice (the
“Response Notice”) if the Seller
is unable or unwilling to convey title to the Owned Real Property without being
subject to any or all of the Objections (specifying in detail the Objections
which the Seller does not intend to cure) within five (5) 

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Business Days after the Response Notice is given. If the Seller does
not respond within such five (5) Business Day period, then the Seller shall be
required to convey title to the Owned Real Property without exception for such
Objections at Closing. The Purchaser may elect, by written notice given to the
Seller within five (5) Business Days after the Purchaser’s receipt of the
Response Notice, to (i) accept such title to the Owned Real Property as the
Seller is able or willing to convey, or (ii) extend the time for the cure or
removal of the Objections, provided
such extension shall not derogate from the Purchaser’s rights under clause (iv)
below, (iii) cause the Objections relating to Liens other than Permitted Liens
(including Monetary Encumbrances) to be cured at the Seller’s expense, and
proceed to the Closing (and the Seller acknowledges and agrees that the
Purchaser Parent may deduct a portion of the Preliminary Net Book Value payable
at the Closing in connection with the removal of Monetary Encumbrances), or
(iv) terminate this Agreement, in which event no Party hereto shall have any
liability to another Party hereto.

                                   (d)          Notwithstanding
anything to the contrary contained in this Agreement, at or prior to the
Closing, the Seller shall cause to be removed of record (i) any mortgage, deed
of trust, security agreement, or financing statement secured by all or any
portion of the Owned Real Property and/or Improvements, (ii) remove all
mechanics’ liens filed against all or any portion of the Owned Real Property
and/or Improvements, (iii) remove any broker’s lien, judgment lien or any other
Lien with respect to an obligation secured by the Owned Real Property and/or
Improvements which can be satisfied solely by payment of a liquidated sum (the
items described in the preceding clauses (i), (ii) and (iii) are, collectively,
“Monetary Encumbrances”). The
Purchaser and the Purchaser Parent acknowledge and agree that the Seller may
use a portion of the Preliminary Net Book Value payable at the Closing in
connection with the removal of Monetary Encumbrances.

          5.3          Notice
of Certain Events.

                                   (a)          Each
Party shall promptly notify each other of:

                                                 (i)           any
notice or other communication from any Person alleging that the consent of such
Person is or may be required in connection with the Contemplated Transactions;

                                                 (ii)          any
notice or other communication from any Governmental Authority in connection
with the Contemplated Transactions;

                                                 (iii)         any
Actions commenced or, to the knowledge of the such Party, threatened against,
relating to or involving or otherwise affecting such Party which relate to the
consummation of the Contemplated Transactions;

                                                 (iv)          its
obtaining knowledge of the occurrence, or failure to occur, of any event which
occurrence or failure to occur will be likely to cause (A) any representation
or warranty made by such Party contained in this Agreement that is qualified as
to materiality becoming untrue or inaccurate in any respect or any such
representation of warranty that is not so qualified becoming untrue or
inaccurate in any material respect, in each case where such representation or
warranty becoming untrue or inaccurate would cause the conditions set 

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forth in Section 6.1 or 6.2 not to be satisfied, (B) the failure of
such Party to comply with or satisfy in any material respect any covenant,
condition or agreement to be complied with or satisfied by it under this
Agreement and (C) any fact or development which would reasonably be expected to
result in the failure of any condition hereto not to be satisfied; 

                                                 (v)          the
failure of such Party to perform, or comply with, in any material respect any
of its obligations, covenants, or agreements contained in this Agreement; or

                                                 (vi)          such
Party obtaining knowledge of a material breach by the other Party of such other
Party’s representations, warranties or covenants hereunder of which the
breaching Party has not already given notice pursuant to clauses (iv) or (v)
above, which material breach would cause the conditions set forth in Section
6.1 or 6.2 not to be satisfied.

                                   (b)          The
Seller shall promptly notify the Purchaser and the Purchaser Parent of any
proposed action described in Section 5.1, or of any event or occurrence not in
the Ordinary Course of Business which would reasonably be expected to have a
Business Material Adverse Effect.

                                   (c)          No
notification under this Section 5.3 shall affect the representations,
warranties or obligations of the Parties or the conditions to the obligations
of the Parties hereunder, or limit or otherwise affect the remedies available
hereunder to the Party receiving such notice.

          5.4          Bulk
Sales Compliance. The Seller will comply with the provisions of any
applicable bulk sales laws (or similar laws) of any state required in
connection with the transactions contemplated by this Agreement.

          5.5          Environmental
Insurance. As soon as reasonably practicable after the date of this
Agreement, the Purchaser and the Purchaser Parent shall obtain, at their
expense, an environmental impairment liability insurance policy (the “Environmental
Impairment Liability Insurance Policy”) with respect to the Owned
Real Property, from an insurance company reasonably acceptable to the Purchaser
and the Purchaser Parent. The Purchaser and the Purchaser Parent shall be named
insureds therein. Subject to its terms, the Environmental Impairment Liability
Policy shall cover first- and third-party claims for cleanup costs for unknown,
preexisting on-site conditions, and third-party claims for cleanup costs,
bodily injury or property damage due to unknown, pre-existing on-site
conditions. The Purchaser and the Purchaser Parent shall agree upon the insurance
indication and the policy form, including reasonable endorsements thereto
acceptable to the insurance company. Such endorsements may include an insured
contract endorsement, renewal, approval of the Purchaser and the Purchaser
Parent to changes to the policy, limitation of the insured v. insured
exclusion, separation of insureds, and additional insureds. The Seller shall
cooperate in the preparation of any required applications for the Environmental
Impairment Liability Policy, which applications shall be executed and submitted
by the Purchaser and the Purchaser Parent. 

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ARTICLE VI

CONDITIONS TO THE CLOSING

          6.1          Conditions
to Obligations of Each Party. The respective obligations of each Party to
this Agreement to consummate and effect this Agreement and the Contemplated
Transactions shall be subject to the satisfaction at or prior to the Closing of
each of the following conditions, any of which may be waived, in writing, by
agreement of the Parties:

                                   (a)          No
Injunctions or Restraints; Illegality. No temporary restraining order,
preliminary or permanent injunction or other order issued by any court of
competent jurisdiction or other legal or regulatory restraint or prohibition
preventing the consummation of the Contemplated Transactions shall be and
remain in effect, nor shall any Action brought by an administrative agency or
commission or other Governmental Authority seeking any of the foregoing be
pending, which would reasonably be expected to have a Business Material Adverse
Effect or which would reasonably be expected to prevent the Purchaser or the
Purchaser Parent from completing the transactions contemplated by the Operative
Agreements, nor shall there be any action taken, or any statute, rule,
regulation or order enacted, entered, enforced or deemed applicable to the
Contemplated Transactions, which makes the consummation of the Contemplated
Transactions illegal.

                                   (b)          Governmental
Approval. The Parties shall have obtained from each Governmental Authority
all approvals, waivers and consents, if any, necessary for consummation of, or
in connection with, the Contemplated Transactions.

                                   (c)          Supply
Agreement. The Seller, the Purchaser and the Purchaser Parent shall have
entered into a Supply Agreement substantially in the form attached hereto as
Exhibit B (the “Supply Agreement”).

                                   (d)          License
and Support Agreement. The Seller, ASML NV, the Purchaser and the Purchaser
Parent shall have entered into a License and Support Agreement substantially in
the form attached hereto as Exhibit C (the “License
and Support Agreement”).

          6.2          Additional
Conditions to the Obligations of the Purchaser and the Purchaser Parent.
The obligations of the Purchaser and the Purchaser Parent to consummate and
effect this Agreement and the Contemplated Transactions shall be subject to the
satisfaction at or prior to the Closing of each of the following conditions,
any of which may be waived, in writing, by the Purchaser and the Purchaser
Parent:

                                   (a)          Accuracy
of Representations and Warranties. Each of the representations and
warranties of the Seller in this Agreement that is expressly qualified by a
reference to materiality shall be true and correct in all respects as so
qualified, and each of the representations and warranties of the Seller in this
Agreement that is not so qualified shall be true and correct in all material
respects, each as of the date when made and at and as of the Closing, except
for such changes as are permitted by this Agreement and except to the extent a
representation or warranty speaks only as of an earlier date, which shall be
true and correct as of such date.

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                                   (b)          Performance
of Obligations. The Seller shall have performed and complied in all
material respects with all covenants, obligations and conditions of this
Agreement required to be performed and complied with by it as of the Closing.

                                   (c)          Third
Party Consents. All consents or approvals from any applicable third party
to the contemplated assignment of the Assumed Contracts identified in Schedule 6.2(c)
attached hereto shall have been obtained and shall be in full force and effect.

                                   (d)          No
Governmental Litigation. Except for Actions which, individually or in the
aggregate, would not reasonably be expected to have a Business Material Adverse
Effect, there shall not be pending or threatened any Action by any Governmental
Authority, and none of the Parties shall have received any communication from
any Governmental Authority in which such Governmental Authority indicates the
probability of commencing any Action, (i) seeking to restrain or prohibit
consummation of the Contemplated Transactions, seeking to place limitations on
the ownership of Acquired Assets or assumption of the Assumed Liabilities by
the Purchaser, (ii) seeking to prohibit or materially limit the ownership or
operation of the Business or the Acquired Assets by the Purchaser, or to compel
any Party the divest or hold separate any portion of the Business or the
Acquired Assets or (iii) seeking to prohibit the Purchaser or the Purchaser
Parent from effectively controlling the Business in any material respect.

                                   (e)          No
Material Adverse Change. No event, occurrence or development shall have
occurred since the date of this Agreement and be continuing which has had or
would be reasonably likely to result in any change, effect, event, occurrence
or state of facts (or any development that has had or is reasonably likely to
have any change or effect) that, individually or in the aggregate, has had or
would have a Business Material Adverse Effect.

                                   (f)          Seller’s
Closing Deliveries. The Seller shall have delivered to the Purchaser and
the Purchaser Parent the following:

                                                 (i)           Officer’s
Certificate. A certificate executed on behalf of the Seller by the
president of the Seller certifying that the conditions set forth in Section
6.2(a), (b) and (e) have been satisfied.

                                                 (ii)          Bill
of Sale and Assignment. A bill of sale and assignment in the form attached
hereto as Exhibit D.

                                                 (iii)         Assumption
Agreement. An executed counterpart of an instrument of assumption of the
Assumed Liabilities and the Assumed Contracts in substantially the form
attached hereto as Exhibit E (the “Assumption Agreement”).

                                                (iv)          Real
Property Deed. A deed of transfer with respect to the Owned Real Property
and Improvements, in form and substance reasonably acceptable to the Purchaser
and its counsel.

                                                 (v)          Title
Affidavit. All affidavits, indemnities and agreements required for or
requested by the Title Insurer, including such affidavits, indemnities and
agreements sufficient for the Purchaser and the Purchaser Parent to obtain the
Title Policy

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without exception for any gap period, mechanic’s or materialmen’s
liens, parties in possession, or other general or standard exceptions title
affidavit in the form and substance reasonably acceptable to the Title Insurer.

                                                 (vi)         Other
Instruments of Transfer. Such other instruments of sale, transfer, conveyance
and assignment as the Purchaser and its counsel have reasonably requested at
the Closing.

                                                 (vii)        Release
of Liens. Written evidence reasonably acceptable to the Purchaser and its
counsel of the release of the Liens, if any, on the Acquired Assets.

                                                 (viii)       FIRPTA
Certificate. A certification substantially in the form attached hereto as Exhibit
F, conforming to the requirements of Treasury Regulations 1.1445-2(b)(2)
(FIRPTA certificate).

                                                 (ix)         Good
Standing Certificates and Authorizing Documents. A certificate of good
standing of the Seller from the Secretary of State of the State of Delaware and
a certificate of good standing and qualification to do business (or the
equivalent) of the Seller from the Secretary of State of the State of
California, together with a copy of all organizational documents, and all
affidavits and other documents necessary to establish the authority of the
Seller and the persons executing documents for the Seller to enter into this
Agreement and consummate the transactions contemplated by this Agreement, in
the form and substance reasonably acceptable to the Purchaser Parent and the
Title Insurer.

                                                 (x)          Purchase
Orders. Purchase orders for inventory and WIP included in the Acquired
Assets to be repurchased by the Seller, and for any additional backlog for the
Seller, and a rolling twelve-month forecast of the Seller’s projected
post-Closing demand for products from the Business. 

                                   (g)          Independent
Accountants. The report of findings on the performed agreed upon procedures
to the Pro-forma Profit and Loss statement of the Business, on a
“standalone” basis, for the fiscal year 2009, prepared at the Seller’s expense
by Deloitte Accountants B.V., the Seller’s registered independent accounting
firm (the “Accounting Firm”), as set forth in that certain letter to the
Seller from the Accounting Firm dated October 25, 2010 will not have been
withdrawn or otherwise revoked and the findings reported in such letter will
not have been modified, rescinded, retracted or otherwise called into question
by the Seller or the Accounting Firm. 

                                   (h)          Title
Policy. The Purchaser Parent shall have obtained a fully effective Title
Policy reasonably acceptable to the Purchaser and its counsel, in the amount of
the Purchase Price, which Title Policy shall not contain any “general” or
“standard” exceptions, and shall not be subject to or contain any Liens,
conditions, requirements or exceptions, except for the Permitted Liens.

                                   (i)          Opinion.
Counsel for the Seller shall have delivered to the Purchaser and the Purchaser
Parent an opinion covering the matters set forth on Exhibit G.

                                   (j)          Employees.

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                                                 (i)          In
the event that any Employee is no longer employed by the Seller, or the Seller
has hired any new Employee prior to the Closing, the Seller shall deliver to
the Purchaser an updated version of the schedule of Employees referred to
Section 3.13.

                                                 (ii)          Seven
(7) of the nine (9) Employees identified on Schedule 6.2(j), including
specifically each of Robert Kestner, James Kennon and Daniel Bajuk, shall have
accepted the Purchaser Parent’s offer of employment pursuant to Section 7.8.

                                                 (iii)        At
least 75% of the Employees identified on the schedule referred to in Section
3.13(a) (as amended pursuant to Section 6.2(j)(i), if applicable) to whom the
Purchaser Parent makes an offer of employment (at least four (4) Business Days
before the Closing in accordance with Section 7.8) shall have accepted the
Purchaser Parent’s offer of employment pursuant to Section 7.8. 

                                   (k)          Trademark
Assignment. ASML NV shall deliver a trademark assignment of the registered
trademark “ASML PerfectWave” in substantially the form attached hereto as Exhibit
H (the “Trademark Assignment”).

                                   (l)          Environmental
Impairment Liability Insurance Policy. The Purchaser and the Purchaser
Parent shall have obtained a binding commitment for the issuance of the
Environmental Impairment Liability Insurance Policy reasonably acceptable to
the Purchaser Parent and its counsel.

          6.3          Additional
Conditions to Obligations of the Seller. The obligations of the Seller to
consummate and effect this Agreement and the Contemplated Transactions shall be
subject to the satisfaction at or prior to the Closing of each of the following
conditions, any of which may be waived, in writing, by the Seller:

                                   (a)          Accuracy
of Representations and Warranties. Each of the representations and
warranties of the Purchaser and the Purchaser Parent in this Agreement that is
expressly qualified by a reference to materiality shall be true and correct in
all respects as so qualified, and each of the representations and warranties of
the Purchaser and the Purchaser Parent in this Agreement that is not so
qualified shall be true and correct in all material respects, each as of the
date when made and at and as of the Closing, except for such changes as are
permitted by this Agreement and except to the extent a representation or
warranty speaks only as of an earlier date, which shall be true and correct as
of such date.

                                   (b)          Performance
of Obligations. The Purchaser and the Purchaser Parent shall have performed
and complied in all material respects with all covenants, obligations and
conditions of this Agreement required to be performed and complied with by them
as of the Closing.

                                   (c)          Purchaser
Closing Deliveries. The Purchaser and the Purchaser Parent shall have
delivered to the Seller the following:

                                                 (i)          Officer’s
Certificate. Certificates executed on behalf of the Purchaser and the
Purchaser Parent by their respective chief executive officers certifying that
the conditions set forth in Section 6.3(a) and (b) have been satisfied.

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                                                 (ii)          Consideration.
Immediately available funds equal to the sum of the Preliminary Net Book Value
(less any reductions pursuant to Section 5.2(c) or (d)) and the net amount of
reimbursements and prorations in favor of the Seller, if any, provided for in
Section 2.8, by wire transfer to a bank account designated by the Seller (such
designation to be provided to the Purchaser Parent not later than two (2)
Business Days prior to the Closing Date).

                                                 (iii)         Assumption
Agreement. An executed counterpart of the Assumption Agreement.

                                                 (iv)         Other
Instruments of Assignment and Assumption. Such other instruments of assumption
of liabilities as the Seller and its counsel have reasonably requested at the
Closing.

ARTICLE VII

COVENANTS

          7.1          Press
Releases and Public Announcements. No public announcement, press release,
or other publicity regarding this Agreement or the Contemplated Transactions
shall be made on or after the date of this Agreement without the prior written
approval of the other Party following an opportunity to review such proposed
announcement or release, which approval of the other Party shall not be
unreasonably withheld by such other Party. Notwithstanding the foregoing,
nothing in this Agreement shall preclude or prevent either Party from making
any public announcement or filing that the disclosing Party believes in good
faith is required for it to comply with by applicable Legal Requirements (in
which case the disclosing Party will provide the other Party with the
opportunity to review in advance the disclosure), including applicable federal
or state securities laws or any rules of a stock exchange upon which any shares
of such Party are listed for trading.

          7.2          Payment
Received; Payment of Excluded Liabilities and Assumed Liabilities. After
the Closing, in the event that a Party receives any payment or other amount allocated
to the other Party pursuant to this Agreement, the receiving Party agrees to
forward such payment or other amount in good faith as promptly as practicable
to the other Party. The Seller agrees to continue to pay all Excluded
Liabilities, and the Purchaser agrees to pay (and the Purchaser Parent agrees
to cause the Purchaser to pay) all Assumed Liabilities, in each case in the
Ordinary Course of Business following the Closing.

          7.3          Future
Assurances. At any time and from time to time after the Closing, at the
request of a Party and without further consideration, the other Party will
execute and deliver such other appropriate instruments of sale, transfer,
conveyance, assignment and confirmation (in each case, as the requesting Party
may reasonably request) and take such action as shall reasonably be necessary
to effectuate the provisions and purposes of this Agreement; provided
however that, notwithstanding anything to the contrary herein, such
assistance shall not be required to the extent it would unreasonably interfere
with the business or operations of the Party from whom such assistance is being
requested; provided
further that nothing herein shall require such assistance to the
extent it would require the Party from whom such assistance is being requested

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to pay (or agree to pay) any fees, reimburse any expenses, incur any
liability or give any indemnities for which it is not reimbursed or
indemnified.

          7.4          Access
to Books, Records, etc. 

                                   (a)          Subject
to Section 7.5 below, each of the Purchaser and the Purchaser Parent agrees
that it will cooperate with and make available to the Seller, during normal
business hours and upon reasonable notice, all books and records, information
and Closing Date Employees (without substantial disruption of employment)
retained and remaining in existence after the Closing Date (excluding Tax
Returns and records and information pertaining to the period from and after the
Closing) that are necessary in connection with any inquiry, audit,
investigation, dispute, litigation or other proceeding or similar matter
involving or related to the Seller (other than any dispute among the Parties or
their respective Affiliates with respect to this Agreement and the Contemplated
Transactions) or which the Seller may otherwise request in connection with the
performance of its obligations under this Agreement. The Purchaser and the
Purchaser Parent each agrees that it shall preserve and keep all Records for a
period of at least seven (7) years from the Closing Date; provided that the Purchaser or the
Purchaser Parent may thereafter destroy any Records in the Ordinary Course of
Business.

                                   (b)          In
addition, subject to Section 7.5 below, the Seller agrees to cooperate with and
make available to the Purchaser and the Purchaser Parent, during normal
business hours and upon reasonable notice, all books, records and information
of the Seller which relate to the Business, the Acquired Assets or the Assumed
Liabilities, retained by the Seller and remaining in existence after the
Closing Date that are necessary solely in connection with any financial
reporting obligation to the extent required by Regulation S-X under the
Securities Exchange Act of 1934 (“Regulation S-X”), inquiry, audit,
investigation, dispute, litigation or other proceeding or similar matter to
which the Purchaser or the Purchaser Parent is a party and which involves or
relates to the Business, the Acquired Assets or the Assumed Liabilities. The
Seller agrees that it shall preserve and keep all books and records of the
Seller relating to the Business, the Acquired Assets and the Assumed
Liabilities for a period of at least seven (7) years from the Closing
Date; provided that the Seller
may thereafter destroy records and information in the ordinary course of
business to the extent in the Seller’s possession.

          7.5          Confidentiality.

                                   (a)          Each
Party agrees to maintain in the strictest confidence, and shall cause their
respective lenders, and representatives, including representatives of such
lenders, to maintain in the strictest confidence, any and all information,
written or otherwise, related to the assets, liabilities, operations and/or
business of the other Party (“Confidential
Information”), unless (i) such Confidential Information is already
known to such Party or to others not bound by a duty of confidentiality or such
Confidential Information becomes publicly available, in each case, through no
fault of such Party from a person who is not otherwise bound by this provision
with respect to the Confidential Information, (ii) the use of such Confidential
Information is necessary in making any filing or obtaining any consent or
approval required for the consummation of the Contemplated Transactions or the
satisfaction of the public company reporting requirements applicable to the
applicable Party, with the prior consent of the Seller and the Purchaser
Parent, which consent will not be unreasonably withheld or delayed; (iii)

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disclosure of Confidential
Information required by applicable Legal Requirements, as set forth in Section
7.5(b); or (iv) such disclosures occur pursuant to and in accordance with the
License and Support Agreement or the Supply Agreement.

                                   (b)          Each
Party agrees that in the event it or its representatives are required by
applicable Legal Requirements to disclose the Confidential Information or the
terms of this Agreement or existence of the Contemplated Transactions, then
such Party will provide prompt written notice thereof to the other Party,
together with a copy of any process documents received in connection with such
Legal Requirements, and will cooperate with the other Party so as to enable the
other Party to seek an appropriate protective order or other remedy.

                                   (c)          Each Party agrees that, in the
event of an actual or threatened breach of this Section 7.5 by such Party, the
other Party shall be entitled to injunctive relief to prevent such actual or
threatened breach, it being agreed that the other Party shall not have any
adequate remedy at law.

          7.6          Non-Assignable
Assets. Following the Closing, the Seller shall use commercially reasonable
efforts at no undue expense to cooperate with and assist the Purchaser and the
Purchaser Parent in obtaining all consents required in connection with the
Contemplated Transactions not obtained as of the Closing. To the extent that
any consent is not obtained, at the Purchaser’s request the Seller and the
Purchaser shall enter into agreements for each Assumed Contract, Permit or
other right included in the Acquired Assets for which consent was not obtained,
under which the Purchaser shall obtain the rights and benefits of any such
Assumed Contract, Permit or other right at the Purchaser’s cost and assume the
corresponding obligations and liabilities of the Seller thereunder, so that the
Parties are, to the greatest extent possible, put in the same economic position
they would have been in had such consent been obtained unconditionally and
without recourse. Such agreements may be in the form of a subcontract,
sub-license or sub-lease appointing the Purchaser as agent to the Seller to
perform thereunder, or any other arrangement under which the Purchaser could
enforce for the benefit of the Purchaser any and all rights and benefits of the
Seller against the third party thereto. If the Parties are able neither to
obtain a consent nor enter into an agreement providing the Purchaser the rights
and benefits with respect to any Assumed Contract, Permit or other right, they
shall promptly and in good faith agree upon an appropriate reduction of the
Purchase Price, and the Seller shall promptly pay such reduction amount to the
Purchaser.

          7.7          Responsibility
for Property Taxes; Other Prorations. All Property Taxes levied with
respect to any of the Acquired Assets for any Straddle Period shall be
apportioned between the Seller and the Purchaser based upon the number of days
of such period included in the Pre-Closing Date Tax Period and the number of
days of such Tax period included in the Post-Closing Date Tax Period. The
prorations described in the preceding sentence shall be based upon the actual
Tax bills for the applicable Tax periods. In the event that the actual amount
of any such Taxes for an applicable Tax period is not known as of the Closing
Date, the proration of such Taxes shall be made based upon the latest available
Tax figures, and when the actual Tax bills for such Taxes for the applicable
Tax period is received by any Party, such Party shall provide notice of its
receipt and a copy of such bills to the other Party, and if necessary, the
Parties shall thereafter promptly make a cash settlement based upon the actual
Tax rates and appraised values. Except as otherwise herein expressly provided,
the customs in respect to title closings of the state

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in which the Owned Real Property is located shall apply to all other
apportionments and prorations.

          7.8          Offers
of Employment. The Purchaser Parent shall, at least four (4) Business Days
before the Closing, offer at-will employment to all of the Employees identified
to the Purchaser Parent in the schedule of Employees referred to in Section
3.13 (as amended pursuant to Section 6.2(j)(i), if applicable) who are in good
standing on the Closing Date (each, a “Closing
Date Employee”), any such offer to be contingent upon the Closing.
The Seller shall cooperate with the Purchaser Parent in connection with the
foregoing. In addition, the Seller shall notify each Closing Date Employee in
writing that his or her employment with the Seller will be terminated as of
immediately prior to the Effective Time. A Closing Date Employee who accepts
such offer of employment will become a “Transferred
Employee,” if at all, on or as of: (1) immediately after the
Closing, if such Closing Date Employee is then actively at work; (2)
immediately after the Closing Date, if such Closing Date Employee is absent
from work on such date due to authorized vacation or jury duty and returns to
active employment following the end of the vacation or the completion of jury
duty, as the case may be; or (3) the date such Closing Date Employee is able to
perform the essential functions of his or her job and returns to active
employment, in the case of a Closing Date Employee who, on the Closing Date, is
absent from work due to sick leave, short term disability, maternity leave, military
leave or other authorized leave of absence with a right to return to his or her
job, and who returns to active employment within the time required under the
original terms and conditions applicable to such absence. Notwithstanding the
foregoing, the Purchaser Parent shall not be obligated to hire any Closing Date
Employee who fails to provide the Purchaser Parent documentation as required by
applicable federal or state laws in connection with the commencement of such
employment or who fails to pass any pre-employment background check required by
the Purchaser Parent. In addition, after the Closing, the Purchaser Parent
shall provide employee benefits to the Transferred Employees that are
comparable in the aggregate to those provided to similarly situated employees
of the Purchaser Parent as of the Closing Date, and, where applicable, shall
provide credit for service with the Seller for the purposes of eligibility and
vesting (but not for benefit accrual) under the Purchaser Parent’s
corresponding employee benefit plans and such credit for the Seller service
shall also be given for the purpose of determining the amount of vacation
Transferred Employees may take after the Closing Date. Notwithstanding the
foregoing, nothing in this Section 7.8 shall be construed to require any
duplication of benefits. This Section 7.8 shall not be deemed to prohibit the
Purchaser Parent from amending, modifying, replacing or terminating such
arrangements in accordance with their terms or terminating any Closing Date
Employee who is an employee at will. The Seller shall be responsible for the
payment of all unused vacation, bonuses and other compensation and benefits
accrued by Transferred Employees prior to the date they become Transferred
Employees (including, without limitation, unused vacation time that was accrued
by a Transferred Employee while employed by a predecessor employer and that was
assumed by the Seller). 

          7.9          COBRA
and Other Obligations. The Seller will continue to maintain group health
plan coverage available to its employees after the Closing such that neither
the Purchaser nor the Purchaser Parent will become a “successor employer,” as
that term is defined in paragraph (c) of Q&A-8 of Treasury Regulation
§54.4980B-9. Neither the Purchaser nor the Purchaser Parent assumes and neither
of them will assume the sponsorship of, the responsibility for contributions
to, or any liability under or in connection with, any Employee Plan. Without

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limiting the foregoing, the Purchaser and the Purchaser Parent shall
have no obligation whatsoever to pay all or any part of, and the Seller shall
remain responsible for, (i) any severance benefits that the Seller is or may be
obligated to pay in connection with the termination of employment by the Seller
of any Employee, (ii) accrued but unpaid salaries, wages, bonuses, incentive
compensation or other compensation owing by the Seller to Employees or (iii)
any bonuses or other amounts due to Employees with respect to their employment
by the Seller arising from or related to the transactions contemplated herein
or any other types of stay or change in control bonus payments. 

          7.10          Wage
Reporting. The Purchaser Parent will file a Form W-2 for 2010 for each
Transferred Employee reporting only the wages paid by the Purchaser Parent
during such year to such Transferred Employee. The Seller will be responsible
for filing a Form W-2 for each Transferred Employee with respect to wages paid
by the Seller before the Closing Date. In addition, each of the Seller and the
Purchaser Parent will file Forms 941 for the quarter during which the Closing
occurs, reflecting the wages and deposits made during its period of ownership
with respect to the Transferred Employees. 

          7.11          Retention
Grants. After the Closing, the Purchaser Parent shall reserve 120,000 shares of
Common Stock for issuance to certain Transferred Employees. The Purchaser
Parent, in coordination with senior management of the Business, shall determine
which Transferred Employees should receive grants of restricted Common Stock
(such grants, the “Retention Grants”),
the number of shares of restricted Common Stock recommended to be granted to
each such employee, and the recommended vesting and other terms of such
restricted Common Stock. The Retention Grants shall be made under the Purchaser
Parent’s existing Equity Incentive Plan, and shall be subject to the approval
of the Purchaser Parent’s Compensation Committee. 

          7.12          No
Solicitation. 

                                   (a)          During
the period commencing on the Closing Date and continuing through the third
anniversary of the Closing Date (the “Restricted
Period”), (i) neither the Seller nor any of its Affiliates (each, a
“Seller Person”) shall, whether
for its own account or for the account of any Person, directly or indirectly,
solicit to terminate the relationship, or otherwise interfere with the
relationship of the Purchaser or the Purchaser Parent or any of their
Affiliates (each, a “Purchaser Person”)
with, any Person that (A) is a Transferred Employee or employed by or otherwise
engaged to perform services for any Purchaser Person or (B) is a customer or
client of, or subcontractor for, the Business, and (ii) no Purchaser Person
shall, whether for its own account or for the account of any Person, directly
or indirectly, solicit to terminate the relationship, or otherwise interfere
with the relationship of any Seller Person with, any Person that is a customer,
employee or client of, or subcontractor for, any Seller Person; provided,
however, that this Section 7.12(a) shall not prevent advertisements,
solicitations, position listings or notices of employment opportunities that
are published or made available to the public generally or hiring of personnel
responding thereto.

                                   (b)          The
restrictive covenants set forth in this Section 7.12 (the “Restrictive Covenants”) have been
separately bargained for to protect the respective interests of the Parties
hereunder and to ensure that the Parties shall have the full benefit of the
value of such interests. Each Party recognizes and acknowledges that other
Party is investing substantial

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sums in connection with the Parties’ respective execution of this
Agreement and the consummation of the transactions contemplated hereunder, that
such Restrictive Covenants are necessary in order to protect and maintain the
respective legitimate business interests of the Parties and are reasonable in
all respects, and that the Parties would not consummate the transactions
contemplated hereby but for such Restrictive Covenants. Each Party hereby
waives any and all right it may have to contest the validity of the Restrictive
Covenants on any grounds.

                                   (c)          If
any Seller Person or Purchaser Person breaches, or threatens to commit a breach
of, any of the Restrictive Covenants, the Purchaser and the Purchaser Parent or
the Seller, as the case may be, shall have, in addition to, and not in lieu of,
any other rights and remedies available to such Party under law or in equity,
the right to seek to have the Restrictive Covenants specifically enforced by
any court of competent jurisdiction, it being agreed that any breach or
threatened breach of the Restrictive Covenants would cause irreparable injury
to the applicable Party, as the case may be, and that money damages would not
provide an adequate remedy. Each of the Parties covenants and agrees not to
oppose any demand for specific performance and injunctive and other equitable
relief in case of any such breach or attempted breach, as applicable.

                                   (d)          The
existence of any claim or cause of action against the a Party under this
Section 7.12 shall not constitute a defense to the enforcement by a Party of
the Restrictive Covenants, and any such claim or cause of action shall be
litigated separately.

                                   (e)          In
addition to the remedies that the Parties may seek and obtain pursuant to
Section 7.12(c), the Restricted Period shall be extended by any and all periods
during which a Seller Person or Purchaser Person, respectively, shall be found
by a final non-appealable judgment of a court possessing personal jurisdiction
over such Seller Person or Purchaser Person, respectively, to have been in
violation of any Restrictive Covenant.

                                   (f)          Whenever
possible, each provision of this Section 7.12 shall be interpreted in such
manner as to be effective and valid under applicable law but if any provision
of this Section 7.12 shall be prohibited by or invalid under applicable law,
such provision shall be ineffective to the extent of such prohibition or
invalidity, without invalidating the remainder of such provision or the
remaining provisions of this Section 7.12. If any provision of this Section
7.12 shall, for any reason, be judged by any court of competent jurisdiction to
be invalid or unenforceable, such judgment shall not affect, impair or
invalidate the remainder of this Section 7.12 but shall be confined in its
operation to the provision of this Section 7.12 directly involved in the
controversy in which such judgment shall have been rendered. In the event that
the provisions of this Section 7.12 should ever be deemed to exceed the
limitations permitted by applicable law, then such provision shall be reformed
to the maximum limitations permitted by applicable law.

                                   (g)          The
Seller, the Purchaser and the Purchaser Parent shall each cause any Affiliate
such Party controls to comply with the Restrictive Covenants, and shall use its
reasonable best efforts to cause any Affiliate which such Party does not
control to comply with the Restrictive Covenants.

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          7.13          Cooperation
of Independent Accountants. If the Purchaser Parent reasonably determines
that historical financial statements of the Business, on a “standalone” basis,
are required with respect to any historical period of the Business under
Regulation S-X (and that have not been previously provided), from and after the
Closing, the Seller shall use commercially reasonable efforts to cause the
Accounting Firm to cooperate with the Purchaser Parent and its independent
accountants in the preparation of such financial statements, but only to the
extent required for the Purchaser Parent to comply with its financial reporting
obligations to the extent required by Regulation S-X.

          7.14          WARN
Act. With respect to the Transferred Employees, the Seller shall be responsible
at all times prior to the Closing for taking any and all action that may be
necessary to comply with the terms and provisions of the Worker Adjustment and
Retraining Act (“WARN”), or any similar California or local Legal Requirement
as a result of the Contemplated Transactions. The Purchaser Parent shall be
responsible for compliance with WARN and any similar California or local Legal
Requirement at all times after the Closing.

          7.15          Department
of Defense. The Seller shall be responsible for providing any and all
notices and making any and all filings with the United States Department of
Defense concerning the Contemplated Transactions which are required to be made
before the Closing under applicable Legal Requirements.

          7.16          Use
of ASML Name. Neither the Purchaser nor the Purchaser Parent shall make use
of the “ASML” name in connection with the trademark assigned to them pursuant
to the Trademark Assignment or otherwise in connection with this Agreement and
the transactions contemplated hereby. 

ARTICLE VIII

TERMINATION

          8.1          Termination.
This Agreement may be terminated at any time prior to the Closing Date (with
respect to Sections 8.1(c) and (d), by written notice by the terminating Party
to the other Party):

                                   (a)          by
either the Purchaser or the Purchaser Parent or the Seller, if the Closing
shall not have occurred on or before December 1, 2010 or such other date that
the Parties may agree upon in writing (the “Termination Date”); provided,
however, that the right to terminate this Agreement under this
clause (a) shall not be available to the Seller if its breach of this Agreement
causes the conditions set forth in Section 6.1 or 6.2 not to be satisfied on or
before the Termination Date or to the Purchaser or the Purchaser Parent if its
breach of this Agreement causes the conditions set forth in Section 6.1 or 6.3
not to be satisfied on or prior to the Termination Date;

                                   (b)          by
the mutual written consent of the Parties;

                                   (c)          by
either the Purchaser and the Purchaser Parent or the Seller if a court of
competent jurisdiction or other Governmental Authority shall have issued a
nonappealable final order, decree or ruling or taken any other action, in each
case having the

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effect of permanently restraining, enjoining or otherwise prohibiting
the Contemplated Transactions;

                                        (d)          by
either the Purchaser and the Purchaser Parent or the Seller (if such Party is
not in material breach of their obligations under this Agreement) if there has
been a breach of any representation, warranty, covenant or agreement on the
part of the other Party set forth in this Agreement, which breach (i) causes
the conditions set forth in Section 6.1 or 6.2 (in the case of termination by
the Purchaser and the Purchaser Parent ) or Section 6.1 or 6.3 (in the case of
termination by the Seller) not to be satisfied and (ii) shall not have been
cured within twenty (20) Business Days following receipt by the breaching Party
of written notice of such breach from the other Party; or

                                        (e)          by
the Purchaser as provided in clause (iv) of Section 5.2(c).

          8.2          Effect
of Termination. In the event of termination of this Agreement as provided
in Section 8.1, there shall be no liability or obligation on the part of any
Party; provided that the
provisions of Article X (including Section 10.10 as to expenses) shall remain
in full force and effect and survive any termination of this Agreement.

ARTICLE IX

INDEMNIFICATION

          9.1          Indemnification.

                                        (a)          Subject
to the limitations set forth in this Article IX, if the Closing is completed,
the Seller will indemnify and hold harmless the Purchaser, the Purchaser Parent
and their respective Affiliates, officers, directors, managers, members,
stockholders, employees, agents and successors and assigns (each, a “Purchaser Indemnified Person”), from,
against and in respect of any and all Losses incurred or suffered by the
Purchaser Indemnified Persons or any of them as a result of or arising out of:

                                                      (i)          any
breach of, or inaccuracy in, any representation or warranty made by the Seller
in this Agreement, including any claims, Actions, suits, proceedings, demands,
assessments, judgments, costs and expenses, including, without limitation, any
legal fees and expenses, arising out of the foregoing (provided that materiality
standards or qualifications in any such representation or warranty shall only
be taken into account in determining whether a breach in connection with such
representation or warranty exists, and shall not be taken into account in
determining the amount of any Losses with respect to such breach);

                                                      (ii)         any
breach of any covenant or agreement of the Seller in or pursuant to this
Agreement, including any claims, Actions, suits, proceedings, demands,
assessments, judgments, costs and expenses, including, without limitation, any
legal fees and expenses, arising out of the foregoing items in this clause
(ii);

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                                                 (iii)        any
fraud or intentional misrepresentation in connection with this Agreement (as
determined by a court of competent jurisdiction, notwithstanding Section 10.15)
by the Seller;

                                                 (iv)         any
Excluded Liability;

                                                 (v)          Property
Taxes specifically allocated to the Seller pursuant to Section 7.7 or Transfer
Taxes specifically allocated to the Seller pursuant to Section 10.10;

                                                 (vi)         any
Excluded Asset; 

                                                 (vii)        the
failure by the Seller to comply with the provisions of any applicable bulk
sales laws (or similar laws) of any state in connection with the Contemplated
Transaction;

                                                 (viii)       the
International and Traffic in Arms Regulations matter set forth in Section 3.2
of the Disclosure Schedule; or

                                                 (ix)         any
claims, Actions, suits, proceedings, demands, assessments, judgments, costs and
expenses, including, without limitation, any legal fees and expenses, arising
out of any of the foregoing clauses (iii) through (viii).

                                   (b)          Subject
to the limitations set forth in this Article IX, the Purchaser and the
Purchaser Parent will, jointly and severally, indemnify and hold harmless the
Seller, its Affiliates and their respective officers, directors, managers,
members, stockholders, employees, agents and successors and assigns (each, a “Seller Indemnified Person”), from, against
and in respect of any and all Losses incurred or suffered by the Seller
Indemnified Persons or any of them as a result of or arising out of:

                                                 (i)          any
breach of, or inaccuracy in, any representation or warranty made by the
Purchaser or the Purchaser Parent in this Agreement, including any claims,
Actions, suits, proceedings, demands, assessments, judgments, costs and
expenses, including, without limitation, any legal fees and expenses, arising
out of the foregoing (provided that materiality standards or
qualifications in any such representation or warranty shall only be taken into
account in determining whether a breach in connection with such representation
or warranty exists, and shall not be taken into account in determining the
amount of any Losses with respect to such breach);

                                                 (ii)          any
breach of any covenant or agreement of the Purchaser or the Purchaser Parent in
or pursuant to this Agreement, including any claims, Actions, suits,
proceedings, demands, assessments, judgments, costs and expenses, including,
without limitation, any legal fees and expenses, arising out of the foregoing
items in this clause (ii);

                                                 (iii)         any
fraud or intentional misrepresentation in connection with this Agreement (as
determined by a court of competent jurisdiction, notwithstanding Section 10.15)
by the Purchaser or the Purchaser Parent;

                                                 (iv)         any
Assumed Liability;

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                                                 (v)          the
ownership and operation of the Acquired Assets and the conduct of the Business
by the Purchaser after the Closing Date; 

                                                 (vi)         Property
Taxes specifically allocated to the Purchaser pursuant to Section 7.7 or
Transfer Taxes specifically allocated to the Purchaser pursuant to Section
10.10; or

                                                 (vii)        any
claims, Actions, suits, proceedings, demands, assessments, judgments, costs and
expenses, including, without limitation, any legal fees and expenses, arising
out of any of the foregoing clauses (iii) through (vi).

          9.2          Time
Limitations. No claim may be made or suit instituted seeking
indemnification under this Article IX unless an Officer’s Certificate (as
defined below) is delivered by the party seeking indemnification under Section
9.1 (the “Indemnified Party”) to
the party against whom indemnity is sought (the “Indemnifying Party”) on or before (such applicable period
during which indemnification under this Article IX may be sought, the “Claims
Period”):

                                   (a)          except
as set forth in Section 9.2(b), the first anniversary of the Closing Date, in
the case of a claim for indemnification pursuant to Section 9.1(a)(i) or
Section 9.1(b)(i); 

                                   (b)          at
any time prior to the thirtieth day after the expiration of the applicable
statute of limitations (taking account any tolling periods or other
extensions), in the case of a claim for indemnification pursuant to Section
9.1(a)(i) with respect to any breach of, or inaccuracy in, the representations
and warranties of the Seller set forth in Section 3.2 (Authority) and Section
3.9(a) (Title to Acquired Assets); 

                                   (c)          except
as set forth in Section 9.2(d), at any time prior to the thirtieth day after
the expiration of the applicable statute of limitations (taking account any
tolling periods or other extensions), in the case of a claim for
indemnification other than under Section 9.1(a)(i) or Section 9.1(b)(i); and

                                   (d)          the
18-month anniversary of the Closing Date, in the case of a claim for
indemnification pursuant to Section 9.1(a)(viii).

          9.3          Monetary
Limitations.

                                   (a)          An
Indemnified Party will not assert any claim for indemnification under Section
9.1(a)(i) or Section 9.1(b)(i) until such time as the aggregate of all Losses
that the Indemnified Party may claim against the Indemnifying Party under
Section 9.1(a)(i) or Section 9.1(b)(i), as applicable, exceed $100,000 (at
which point the Indemnified Party will indemnify the Indemnified Party for all
such Losses) (the “Basket”).
Subject to Section 9.3(c), (i) the maximum aggregate liability of the Seller
for all claims by the Purchaser Indemnified Persons under Section 9.1(a)(i) for
Losses shall be limited to ten percent (10%) of the Revised Net Book Value (the
“Cap”) and (ii) the maximum
aggregate liability of the Purchaser and the Purchaser Parent for all claims by
the Seller Indemnified Persons under Section 9.1(b)(i) for Losses shall be
limited to the Cap.

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                                   (b)          
Any and all dollar amounts payable by the Seller as an Indemnifying Party to
the Purchaser or the Purchaser Parent as an Indemnified Party in connection
with a claim for Losses under Section 9.1(a) will be paid in cash by the Seller
in accordance with payment instructions provided by the Purchaser or the
Purchaser Parent, as applicable. Any and all dollar amounts payable by the
Purchaser or the Purchaser Parent as an Indemnifying Party to the Seller as an
Indemnified Party in connection with a claim for Losses under Section 9.1(b)
will be paid in cash in accordance with payment instructions provided by the
Seller. 

                                   (c)          
Notwithstanding the foregoing, the limitations on liability in Section 9.3(a)
shall not apply to (i) claims for Taxes of the Seller and its Affiliates or
Taxes with respect to the Acquired Assets or the Business that are attributable
to any Pre-Closing Date Tax Period; or (ii) claims for indemnification pursuant
to the provisions of clauses (ii) through (ix) of Section 9.1(a) or clauses
(ii) through (vii) of Section 9.1(b); or (iii) claims for indemnification
pursuant to Section 9.1(a)(i) which pertain to the matters described in Section
9.2(b); provided however, that,
notwithstanding anything to the contrary herein, the aggregate liability of an
Indemnifying Party with respect to all Losses arising out of claims for
indemnification pursuant to any provision of this Article IX (other than
Section 9.1(a)(iii) (Fraud or Intentional Misrepresentation by the Seller) or
Section 9.1(b)(iii) (Fraud or Intentional Misrepresentation by the Purchaser or
the Purchaser Parent) shall not exceed the Purchase Price; provided further that, notwithstanding
anything to the contrary herein, the aggregate liability of an Indemnifying
Party with respect to all Losses incurred or suffered by the Purchaser
Indemnified Persons or any of them pursuant to Section 9.1(a)(i) for any breach
of, or inaccuracy in, the representations and warranties of the Seller set
forth in Section 3.9(a) (Title to Acquired Assets) shall not exceed, with
respect to the item of Personal Property with respect to which indemnification
is sought, an amount equal to the portion of the Purchase Price allocated to
such item of Personal Property as set forth in Schedule 9.3(c) to this
Agreement (as may be revised to reflect any adjustments necessary as a result
of any adjustment to the Purchase Price referenced in Section 2.4); provided further, that, notwithstanding
anything to the contrary herein, the aggregate liability of an Indemnifying
Party with respect to all Losses arising out of claims for indemnification
pursuant to Section 9.1(a)(viii) shall be limited to ten percent (10%) of the
Revised Net Book Value (for the avoidance of doubt, such ten percent (10%)
limitation shall be separate and independent from, and not subject to, the Cap
and Basket described in Section 9.3(a)); and provided
further that nothing herein shall be deemed to limit an Indemnified
Party’s ability, notwithstanding Section 10.15, to bring a claim for equitable
relief or from bringing any action based on fraud or intentional
misrepresentation or the monetary relief available for such claim under Section
9.1(a)(iii) or Section 9.1(b)(iii) in a court of competent jurisdiction. 

          9.4          
Other Limitations. Notwithstanding anything to the contrary herein, an
Indemnified Party shall not be entitled to assert any claim for indemnification
under this Article IX: 

                                   (a)          
for Losses resulting, directly or indirectly, from the Indemnifying Party’s
compliance with the terms of, or the taking of any action required by this
Agreement, or the failure to take any action prohibited by this Agreement; 

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                                   (b)          
for Losses resulting, directly or indirectly, from any actions taken, or
failure to take action by the Indemnifying Party, in each case, to which the
Indemnified Party has in writing expressly approved, consented to or requested;
or 

                                   (c)          
for consequential, punitive, special or similar Losses, except in the case of
fraud or intentional misrepresentation. 

          9.5          
Claims Procedure. 

                                   (a)          
At any time prior to the expiration of the applicable Claims Period (and in
each case promptly after gaining knowledge of the matter giving rise to such
claim), an Indemnified Party may deliver to the Indemnifying Party a
certificate signed by any officer of the Indemnified Party (an “Officer’s Certificate”): 

                                                  (i)          
stating that the Indemnified Party has incurred or suffered Losses; 

                                                  (ii)         
stating the Indemnified Party’s current estimate as to the amount of such
Losses; and 

                                                  (iii)        
specifying in reasonable detail (based upon the information then possessed by
the Indemnified Party) the individual items of such Losses included in the
amount so stated and the nature of the claim to which such Losses are related. 

                                   (b)          
If the Indemnifying Party objects in writing to any claim set forth by the
Indemnified Party in an Officer’s Certificate delivered pursuant to this
Article IX within twenty (20) days after receipt of such Officer’s Certificate,
the Indemnified Party and the Indemnifying Party shall attempt in good faith
for twenty (20) days after the Indemnified Party’s receipt of such written
objection to resolve such claim. If the Indemnifying Party and the Indemnified
Party shall so agree, a memorandum setting forth such agreement shall be
prepared and signed by both Parties. 

                                   (c)          
If no such agreement can be reached after good faith negotiations, but in any
event upon the expiration of the twenty (20) day period specified in Section
9.5(b), either the Purchaser and the Purchaser Parent or the Seller may, by
written notice to the other Party, demand arbitration of the dispute pursuant
to Section 10.15 and, in such event, the matter shall be settled by arbitration
conducted in accordance with the terms thereof. The decision of the arbitrator
as to the validity and amount of any claim in such Officer’s Certificate shall
be binding and conclusive upon the Parties. 

          9.6          
Third Party Claims. 

                                   (a)          
If any third party notifies an Indemnified Party with respect to any matter (a
“Third Party Claim”) which may
give rise to an indemnification claim against an Indemnifying Party under this
Article IX, then the Indemnified Party will promptly give written notice to the
Indemnifying Party; provided, however, that no delay on the part of the
Indemnified Party in notifying the Indemnifying Party will relieve the
Indemnifying Party from any 

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obligation under this
Article IX, except to the extent such delay actually and materially prejudices
the Indemnifying Party. 

                                   (b)          
The Indemnifying Party will be entitled to assume control of the defense of any
Third Party Claim that is the subject of a notice given by the Indemnified
Party pursuant to Section 9.6(a) and shall be entitled to defend the
Indemnified Party against the Third Party Claim with counsel of its choice
reasonably satisfactory to the Indemnified Party so long as (i) the
Indemnifying Party gives written notice to the Indemnified Party, with fifteen
(15) days after the Indemnified Party has given notice of the Third Party Claim
pursuant to Section 9.6(a), that the Indemnifying Party will assume control of
the defense of such Third Party Claim, (ii) the Third Party Claim involves only
money damages and does not seek an injunction or other equitable relief against
the Indemnified Party, (iii) the Indemnified Party has not been advised by
counsel that an actual or potential conflict exists between the Indemnified
Party and the Indemnifying Party in connection with the defense of the Third
Party Claim and (iv) the Third Party Claim does not relate to or otherwise
arise in connection with any criminal or regulatory enforcement action. The
Indemnified Party may retain separate co-counsel at its sole cost and expense
and participate in (but not control) the defense of the Third Party Claim; provided, however,
that the Indemnifying Party will pay the fees and expenses of separate
co-counsel retained by the Indemnified Party that are incurred prior to
Indemnifying Party’s assumption of control of the defense of the Third Party
Claim. 

                                   (c)          
The Indemnifying Party will not consent to the entry of any judgment or enter
into any compromise or settlement with respect to the Third Party Claim without
the prior written consent of the Indemnified Party, which consent shall not be
unreasonably withheld or delayed, unless such judgment, compromise or
settlement (i) provides for the payment by the Indemnifying Party of money as
sole relief for the claimant, (ii) results in the full and general release of
the Purchaser Indemnified Persons or the Seller Indemnified Persons, as
applicable, from all liabilities arising or relating to, or in connection with,
the Third Party Claim and (iii) involves no finding or admission of any
violation of Legal Requirements or the rights of any Person and no negative
effect on any other claims that may be made against the Indemnified Party. 

                                   (d)          
If the Indemnifying Party does not deliver the notice contemplated by clause
(i) of Section 9.6(b) within fifteen (15) days after the Indemnified Party has
given notice of the Third Party Claim, (i) the Indemnified Party may defend,
and may consent to the entry of any judgment or enter into any compromise or
settlement with respect to, the Third Party Claim in any manner it may deem
appropriate and (ii) the Indemnifying Party shall be entitled to participate in
(but not control) the defense of such action, at its own expense, provided that, the Indemnified Party shall
not settle or compromise such Third Party Claim without the prior written
consent of the Indemnifying Party, which consent shall not be unreasonably
withheld or delayed. In the event that the Indemnified Party conducts the
defense of the Third Party Claim pursuant to this Section 9.6(d), the
Indemnifying Party will (i) advance the Indemnified Party promptly and
periodically upon request for the reasonable costs of defending against the
Third Party Claim (including reasonable attorneys’ fees and expenses) and (ii)
remain responsible for any and all other Losses that the Indemnified Party may
incur or suffer resulting from or arising out of the Third Party Claim to the
fullest extent provided in this Article IX. 

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                                   (e)          
Each Party (notwithstanding Section 10.13 and Section 10.15), in its respective
capacity as an Indemnifying Party, hereby consents to the non-exclusive
jurisdiction of any court in which any Third Party Claim may be brought against
any Indemnified Party for purposes of any claim which such Indemnified Party
may have against such Indemnifying Party pursuant to this Agreement in
connection with such Third Party Claim. 

          9.7          
Information. Each Party hereby agrees to provide to the other Parties on
request all information and documentation reasonably necessary to support and
verify any Losses which give rise to a claim for indemnification pursuant to
this Article IX and to provide reasonable access to all books, records and
personnel in their possession or under their control which would have a bearing
on such claim of the defense thereof, which information and documentation shall
be subject to the provisions of Section 7.5(a); provided that each Party reserves the right to exclude such
information and documentation which, based on advice of outside counsel, would
reasonably be expected to jeopardize the providing party’s ability to claim the
attorney-client privilege; provided further,
however, in any case, each Party shall provide to the other
reasonably sufficient information and documentation to enable the Indemnified
Party to support, verify and receive indemnification for all Losses in
accordance with this Article IX. 

          9.8          
Remedies Cumulative; Sole Remedy. The rights of the Purchaser
Indemnified Persons and the Seller Indemnified Persons under this Article IX
are cumulative, and each Purchaser Indemnified Person and Seller Indemnified
Persons, as the case may be, will have the right in any particular
circumstance, in its sole discretion, to enforce any provision of this Article
IX without regard to the availability of a remedy under any other provision of
this Article IX. Notwithstanding the foregoing, except to the extent that a
claim involves fraud or intentional misrepresentation (as determined by a
non-appealable decision of a court of competent jurisdiction), the sole and
exclusive remedy for the matters set forth in Section 9.1(a)(i) or Section
9.1(b)(i) shall be indemnification in accordance with this Article IX. 

          9.9          
Purchase Price Adjustment. Any indemnity payments made pursuant to this
Article IX shall be treated by the Parties as adjustments to the Purchase Price
for all purposes; provided, however,
that for purposes of determining the Cap, the Revised Net Book Value shall not
be adjusted as a result of any indemnity payment. 

          9.10          
Insurance Recoveries. The amount of any Losses payable by a Party
hereunder shall be net of any amounts actually recovered in cash by an
Indemnified Party under applicable insurance policies, including the Title
Policy, net of all expenses incurred in prosecuting such insurance claim and
the present value of any increase in insurance premiums or other charges paid
or to be paid by such Party directly attributable to such Loss. 

          9.11          
Mitigation. Each of the Parties agrees that an Indemnified Party shall
act in good faith to mitigate the amount of any Losses for which
indemnification under this Article IX may be sought by such Indemnified Party; provided, however, that this Section 9.11
shall not enable an Indemnifying Party to avoid its indemnification
obligations, in whole or in part, under this Article IX, except upon a showing
of lack of good faith by the Indemnified Party in mitigating Losses in a
proceeding duly commenced under Section 10.16. 

-55-

ARTICLE
X

MISCELLANEOUS

          10.1          
Entire Agreement. This Agreement, together with the Mutual Nondisclosure
Agreement dated November 24, 2009, the License and Support Agreement and the
Supply Agreement, constitute the entire agreement among the Parties with
respect to the subject matter hereof and supersede any and all prior
discussions, negotiations, proposals, undertakings, understandings and
agreements, whether written or oral, with respect thereto. 

          10.2          
Succession and Assignment; No Third-Party Beneficiary. Subject to the
immediately following sentence, this Agreement will be binding upon and inure
to the benefit of the Parties hereto and their respective successors and
permitted assigns, each of which such successors and permitted assigns will be
deemed to be a party hereto for all purposes hereof. Neither Party may assign,
delegate or otherwise transfer either this Agreement or any of its rights,
interests, or obligations hereunder without the prior written approval of the
other Party. This Agreement is for the sole benefit of the Parties and their
permitted successors and assignees and nothing herein expressed or implied will
give or be construed to give any Person, other than the Parties and such
successors and assignees, any legal or equitable rights hereunder. 

          10.3          
Counterparts. This Agreement may be executed in any number of
counterparts, each of which will be deemed an original, but all of which
together will constitute but one and the same instrument. This Agreement will
become effective when duly executed by each Party hereto. 

          10.4          
Headings. The headings contained in this Agreement are for convenience
purposes only and will not in any way affect the meaning or interpretation
hereof. 

          10.5          
Notices. All notices, requests, demands, claims and other communications
required or permitted to be delivered, given or otherwise provided under this
Agreement must be in writing and must be delivered, given or otherwise
provided: 

                                      (a)          
by hand (in which case, it will be effective upon delivery); 

                                      (b)          
by facsimile (in which case, it will be effective on the Business Day following
receipt of confirmation of good transmission; provided that a copy of any such
facsimile is concurrently sent to the recipient by first class mail); or 

                                      (c)          
by overnight delivery by a nationally recognized courier service (in which
case, it will be effective on the Business Day after being deposited with such
courier service); 

in each case, to the address (or facsimile number)
listed below: 

	
  

 	
  

 	
  

 
	
  

 	
 If to the Seller:

 	
 ASML US, Inc.

 77 Danbury Road

 Wilton, CT 06897

 Phone: (203) 761-4502

 

-56-

	
  

 	
  

 	
  

 
	
  

 	
  

 	
 Fax: (203) 761-4207 

 Attention: William Amalfitano

                  Rich
 Rogoff

 
	
  

 	
  

 	
  

 
	
  

 	
 With a copy to:

 	
 David D. Kim, Esq.

 ASML US, Inc.

 8555 S. River Parkway

 Tempe, AZ 85284

 Phone: (480) 383-4024

 Fax: (480) 383-3978

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 and

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 Jeffrey R. Vetter, Esq.

 Ralph M. Pais, Esq.

 Fenwick & West LLP

 Silicon Valley Center

 801 California Street

 Mountain View, CA 94041

 Phone: (650) 335-7631

 Fax: (650) 938-5200

 
	
  

 	
  

 	
  

 
	
  

 	
 If to the Purchaser Parent

 
	
  

 	
  or the Purchaser:

 	
 Zygo Corporation

 Laurel Brook Road

 P.O. Box 448 

 Middlefield, CT 06455-0448

 Phone: (860) 347-8506

 Fax: (860) 347-8372 

 Attention: Chris L. Koliopoulos, Ph.D.

                  John
 A. Tomich, Esq.

 
	
  

 	
  

 	
  

 
	
  

 	
 With a copy to:

 	
 Paul Jacobs, Esq.

 Sheldon Nussbaum, Esq.

 Fulbright & Jaworski L.L.P.

 666 Fifth Avenue

 New York, NY 10103

 Phone: (212) 318-3000

 Fax: (212) 318-3400 

 

          Either
Party may change the address to which notices, requests, demands, claims, and
other communications hereunder are to be delivered by giving the other Party
notice in the manner herein set forth. 

          10.6          
Mail. The Seller authorizes the Purchaser on and after the Closing Date
to receive and open all mail received by the Purchaser relating to the Acquired
Assets or the Business and to deal with the contents of such communications in
any proper manner. The Seller shall 

-57-

promptly deliver to the
Purchaser any mail or other communications received by the Seller after the
Closing Date pertaining to the Acquired Assets or the Business. The Purchaser
shall promptly deliver to the Seller any mail or other communication received
by the Purchaser after the Closing Date pertaining to the Excluded Assets or
any Excluded Liabilities, and any cash, checks or other instruments of payment
in respect of the Excluded Assets. As soon as is practicable after the Closing
Date, upon the request of the Purchaser, the Seller will mail to its vendors
(to the extent such vendors are direct vendors to the Richmond operations of
the Seller) a notice, the form and content of which shall be approved by the
Purchaser or the Purchaser Parent, of the sale of the Acquired Assets and the
Business hereunder. 

          10.7          
Governing Law. This Agreement and all claims, disputes or other Actions
arising hereunder or out of the Contemplated Transactions shall be governed by
and construed in accordance with the laws of the State of Delaware, without
regard to the conflicts of law rules of such state. 

          10.8          
Amendments and Waivers. No amendment or waiver of any provision of this
Agreement will be valid and binding unless it is in writing and signed, in the
case of an amendment, by each of the Parties, or in the case of a waiver, by
the Party against whom the waiver is to be effective. No waiver by any Party of
any breach or violation of, default under or inaccuracy in any representation,
warranty or covenant hereunder, whether intentional or not, will be deemed to
extend to any prior or subsequent breach, violation, default of, or inaccuracy
in, any such representation, warranty or covenant hereunder or affect in any
way any rights arising by virtue of any prior or subsequent such occurrence. No
delay or omission on the part of any Party in exercising any right, power or remedy
under this Agreement will operate as a waiver thereof. 

          10.9          
Severability. Any term or provision of this Agreement or of any Section
hereof that is invalid or unenforceable in any situation in any jurisdiction
will not affect the validity or enforceability of the remaining terms and
provisions hereof or the validity or enforceability of the offending term or
provision in any other situation or in any other jurisdiction. In the event
that any provision hereof would, under applicable Legal Requirements, be
invalid or unenforceable in any respect, each Party hereto intends that such
provision will be construed by modifying or limiting it so as to be valid and
enforceable to the maximum extent compatible with, and possible under,
applicable Legal Requirements. 

          10.10          
Expenses. The Parties will each pay their own Transaction Expenses,
except for expenses specifically allocated to a Party pursuant to this
Agreement. For the avoidance of doubt, nothing in this Section 10.10 shall
require the Purchaser or the Purchaser Parent to pay any fees or expenses of
any broker, agent or finder engaged by the Seller in connection with this
Agreement or the Contemplated Transactions. The Purchaser and the Purchaser
Parent on the one hand, and the Seller on the other hand, shall each bear 50%
of the costs of any sales, use, excise, and transfer Taxes, any transfer,
recording, registration and other fees, and any similar Taxes and fees
(collectively, “Transfer Taxes”)
imposed with respect to the Contemplated Transactions. The Seller shall, at its
own expense, prepare or cause to be prepared and file or cause to be filed all
necessary Tax Returns and other documentation with respect to all Transfer
Taxes, and, if required by applicable Legal Requirements, the Purchaser shall,
and shall cause its Affiliates to, join in the execution of any such Tax
Returns and other documentation. 

-58-

          10.11          
Rules of Construction. The Parties have participated jointly in the
negotiation and drafting of this Agreement. In the event an ambiguity or
question of intent or interpretation arises, this Agreement will be construed
as if drafted jointly by the Parties and no presumption or burden of proof will
arise favoring or disfavoring any Party by virtue of the authorship of any of
the provisions of this Agreement. Any reference to any federal, state, local or
foreign statute or law shall be deemed also to refer to all rules and
regulations promulgated thereunder, unless the context requires otherwise. The
word “including” shall mean including without limitation. Any reference in this
Agreement to a “day” or number of “days” (without explicit reference to a
“Business Day”) shall be interpreted as a reference to a calendar day or number
of calendar days. If any action or notice is to be taken or given on or by a
particular calendar day, and such calendar day is not a Business Day, then such
action or notice shall be deferred until, or may be taken or given on, the next
Business Day. The disclosure of any matter in the Disclosure Schedule hereto
shall expressly not be deemed to constitute an admission by any Party, or to
otherwise imply, that any such matter is material for the purposes of this
Agreement. The Parties intend that each representation, warranty and covenant contained
herein shall have independent significance. If either Party has breached any
representation, warranty or covenant contained herein in any respect, the fact
that there exists another representation, warranty or covenant relating to the
same subject matter (regardless of the relative levels of specificity) which
the Party has not breached shall not detract from or mitigate the fact that the
Party is in breach of the first representation, warranty or covenant. 

          10.12          
Incorporation of Schedules. The Schedules identified in this Agreement,
and the Disclosure Schedule, are incorporated herein by reference and made a
part hereof. 

          10.13          
Service of Process. Each Party hereby (a) consents to service of process
in any Action between the Parties arising in whole or in part under or in
connection with this Agreement in any manner permitted by the laws of the State
of Delaware, and (b) waives and agrees not to assert (by way of motion, as a
defense, or otherwise) in any such Action any claim that service of process
made in accordance with clause (a) does not constitute good and valid service
of process. 

          10.14          
Waiver of Jury Trial. TO THE EXTENT NOT PROHIBITED BY APPLICABLE LAW
THAT CANNOT BE WAIVED, THE PARTIES HEREBY WAIVE, AND COVENANT THAT THEY WILL
NOT ASSERT (WHETHER AS PLAINTIFF, DEFENDANT OR OTHERWISE), ANY RIGHT TO TRIAL
BY JURY IN ANY ACTION ARISING IN WHOLE OR IN PART UNDER OR IN CONNECTION WITH
THIS AGREEMENT OR ANY OF THE CONTEMPLATED TRANSACTIONS, WHETHER NOW EXISTING OR
HEREAFTER ARISING, AND WHETHER SOUNDING IN CONTRACT, TORT OR OTHERWISE. THE
PARTIES AGREE THAT EITHER OF THEM MAY FILE A COPY OF THIS PARAGRAPH WITH ANY
COURT AS WRITTEN EVIDENCE OF THE KNOWING, VOLUNTARY AND BARGAINED-FOR AGREEMENT
BETWEEN THE PARTIES IRREVOCABLY TO WAIVE ITS RIGHT TO TRIAL BY JURY IN ANY
PROCEEDING WHATSOEVER BETWEEN THEM RELATING TO THIS AGREEMENT OR ANY OF THE
CONTEMPLATED TRANSACTIONS WILL INSTEAD BE TRIED IN A COURT OF COMPETENT
JURISDICTION BY A JUDGE SITTING WITHOUT A JURY. 

-59-

          10.15          
Arbitration. Any dispute, controversy or claim arising under, out of or
relating to this Agreement, including without limitation its validity,
interpretation, performance, breach or termination thereof, will be settled by
final and binding arbitration in New York, New York in accordance with (i) the
then-current Commercial Arbitration Rules of the American Arbitration
Association (the “Rules”) and (ii)
the terms of this Agreement. The terms of this Agreement will control in the
event of any inconsistency between such terms and the Rules. The arbitration
will be conducted before a panel of three arbitrators. Each of the Parties
shall designate one arbitrator and the two arbitrators so designated shall
select the third arbitrator. The arbitration proceeding and all pleadings and
written evidence will be in the English language. The award of the arbitrator
will be in writing setting forth findings of fact and conclusions of law.
Judgment on the arbitrator’s award will be final and binding upon the Parties
and may be entered in any court having jurisdiction thereof. The arbitrator’s
fees will be shared equally by the Parties and each Party will bear its own
costs and attorneys’ fees. All papers, documents, or evidence, whether written
or oral, filed with or presented in connection with the arbitration proceeding
will be deemed by the Parties and by the arbitrator to be Confidential
Information of both Parties. Notwithstanding the foregoing provisions, each
Party reserves the right to seek injunctive or other equitable relief,
including specific performance, in a court of competent jurisdiction with
respect to any dispute, controversy or claim arising under this Agreement for
which such relief is sought. Notwithstanding anything to the contrary herein, each
Party hereby waives, to the fullest extent permitted by Applicable Law, any and
all rights, claims and causes of action, known or unknown, foreseen or
unforeseen, which exist or may arise in the future, that such Party may have
against the other Party or any of such other Party’s Affiliates or
representatives for any special or punitive damages (except in the case of
fraud or intentional misrepresentation) in connection with this Agreement and
the transactions contemplated hereby. 

 [The
remainder of this page is intentionally left blank.]

-60-

          IN
WITNESS WHEREOF, each of the undersigned has executed this Agreement as an
agreement under seal as of the date first above written. 

	
  

 	
  

 	
  

 	
  

 
	
  

 	
 ZYGO RICHMOND CORPORATION

 	
  

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 By:

 	
  

 	
  

 
	
  

 	
  

 	

 

 	
  

 
	
  

 	
  

 	
 Name:

 	
  

 
	
  

 	
  

 	
 Title:

 	
  

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 ZYGO CORPORATION

 	
  

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 By:

 	
  

 	
  

 
	
  

 	
  

 	

 

 	
  

 
	
  

 	
  

 	
 Name:

 	
  

 
	
  

 	
  

 	
 Title:

 	
  

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 ASML US, INC.

 	
  

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 By:

 	
  

 	
  

 
	
  

 	
  

 	

 

 	
  

 
	
  

 	
  

 	
 Name:

 	
  

 
	
  

 	
  

 	
 Title:

 	
  

 

EXECUTION FORM

 

CONFIDENTIAL TREATMENT REQUESTED BY ZYGO CORPORATION
FOR

CERTAIN PORTIONS OF THIS AGREEMENT IN ACCORDANCE WITH RULE 24B-2 UNDER THE 

SECURITIES EXCHANGE ACT OF 1934

 

EXHIBIT B

 

 

 

 

MASTER SUPPLY AGREEMENT

 

 

 

 

 

 

 

 

 

by
and among

 

ASML US, Inc.

 

AND

 

ZYGO RICHMOND
CORPORATION

 

ZYGO CORPORATION

 

 

 

 

 

Date: [October 1], 2010 

 

 

 

 

 

 EXECUTION FORM 

 TABLE OF CONTENTS

	1	DEFINITIONS	1
	2	SCOPE OF THE AGREEMENT; LICENSE	2

	3	ORDERS	3

	4	DELIVERY	3

	5	PRICES	3

	6	[***]	4

	7	POSTPONEMENT OF DELIVERY	4

	8	CONTINUATION	5

	9	CANCELLATION	5

	10	LEAD TIME FOR PRODUCTS	5

	11	SPECIFICATIONS AND MODIFICATIONS	5

	12	INSPECTION AND TESTING	6

	13	WARRANTY	6

	14	CONTINUED SUPPLY	7

	15	INDEMNIFICATION	7

	16	ASSIGNMENT AND SUBCONTRACTING	8

	17	INVOICES AND PAYMENT	8

	18	TERM AND TERMINATION	9

	19	CONFIDENTIALITY	9

	20	LIMITATION OF LIABILITY	10

	21	ENVIRONMENT, HEALTH AND SAFETY	10

	22	GENERAL	11

	23	APPLICABLE LAW, ARBITRATION	11

	EXHIBIT 1 – [***]	13

	EXHIBIT 2 – PRODUCTS	14

 

 

[***]
 Certain information on this page has been omitted and filed separately with the Securities and Exchange
Commission. Confidential treatment has been requested with respect to the omitted portion.

 

 

 EXECUTION FORM 

THIS MASTER SUPPLY AGREEMENT IS
MADE ON [OCTOBER 1], 2010 (THE “EFFECTIVE DATE”)

BY AND AMONG

(1)           ASML
      US, Inc., a Delaware corporation with offices at 77
Danbury Road, Wilton, Connecticut 06897 (hereinafter, “ASML”);
and

(2)           Zygo
    Richmond Corporation, a Delaware corporation, and Zygo Corporation, a
    Delaware corporation and the parent company of Zygo Richmond Corporation,
    both with offices at Laurel Brook Road, Middlefield, Connecticut 06455-0448
    (collectively, hereinafter, “Supplier”). ASML and Supplier
    are each a “Party” and collectively with ASML,
the “Parties”.

WHEREAS

	Supplier
    and ASML have entered into that certain Asset Purchase Agreement (the “Asset
Purchase Agreement”), on even date herewith, pursuant to which ASML
is selling and transferring, and Supplier is purchasing and acquiring, the Acquired
Assets (as defined in the Asset Purchase Agreement), and ASML is assigning and
Supplier is assuming the Assumed Liabilities (as defined in the Asset Purchase
Agreement), of the Richmond, California operations of ASML, on the date hereof
and upon and subject to the terms set forth in the Asset Purchase Agreement;

	The execution and delivery of this Master Supply Agreement by the Parties is a condition
to the closing of the transactions contemplated by the Asset Purchase Agreement;

	Supplier’s
    business is engaged in manufacturing and selling components for various applications,
    including components needed in the field of semiconductor processing systems,
    as set forth on Exhibit 2 (“Products”);

	ASML is a leading manufacturer of semiconductor processing systems and a supplier of
related processes/services and is interested in using the Products manufactured and sold by Supplier and ASML will use those Products
for integrating them in its systems manufactured by ASML; and

	The Parties wish to enter into this Master Supply Agreement, which will set forth the
terms and conditions for delivery of the Products by Supplier to ASML.

 

IT IS AGREED AS FOLLOWS

1.                  
DEFINITIONS

1.1              
The following terms shall have the meanings specified below for the purpose of this Agreement:

(a)            
“Associated Companies” means the ultimate parent company
of a party and any and all companies, firms and legal entities with respect to
which now or hereafter that ultimate parent company (a) directly or indirectly
holds fifty percent (50%) or more of the nominal value of the issued share capital,
or (b) has fifty percent (50%) or more of the voting
power at general meetings, or (c) has the power to appoint a majority of
the directors or to direct otherwise the activities of such company, firm or
legal entity but any such company, firm or legal entity shall be deemed an Associated
Company only as long as such liaison exists.

(b)              “Cancellation” has
  the meaning as set forth in Section 7.3 of this Agreement.

(c)              “Confidential Information” means: (a) all information
related to the Products, including, without limitation, documentation, drawings,
designs and specifications; (b) any non-public information of a Party, including,
without limitation, any

 

 EXECUTION FORM 

information relating to a Party’s technology, techniques, know-how, research, engineering, designs, finances,
accounts, procurement requirements, manufacturing, customer lists, business forecasts and marketing plans; (c) all information
of a Party that constitutes “Confidential Information” as defined in the Asset Purchase Agreement; and (d) the specific
terms and pricing set forth in this Agreement.

(d)             “Continuation” has
  the meaning as set forth in Section 7.3 of this Agreement.

(e)             
“Defaulting Party” has the meaning as set forth in
Section 18.2 of this Agreement.

(f)              
“Fixed Price Decrease Percentage” has the meaning as
set forth in Section 6.1 of this Agreement.

(g)             
“Holding Fee” has the meaning as set forth in Section
7.2(a) of this Agreement.

(h)             
“Inspection Period” has the meaning as set forth in
Section 12.2 of this Agreement.

(i)                Intellectual
    Property Right(s) or IPR means patent rights (including patent applications
    and disclosures), copyrights, mask work rights, trade secrets, know how,
    manufacturing methods and any other intellectual property rights recognized
    in any country or jurisdiction in the world, but excluding trademarks and
    related rights (e.g., trade names, trademarks, service marks, design patents,
    logos and trade dress).

(j)               
“Original Delivery Date” has the meaning as set forth
in Section 7.1 of this Agreement.

(k)             
“Products” has the meaning as set forth in the Recitals
of the Agreement.

(l)               
“Purchase Order” means an order for Products delivered
to Supplier by ASML.

(m)           
“Specifications” has the meaning as set forth in Section
11.1 of this Agreement.

2.               
SCOPE OF THE AGREEMENT; LICENSE

2.1             This Agreement
  constitutes a master agreement setting forth the rights and obligations of
  the Parties with respect to all Purchase Orders for the Products that ASML
  submits to Supplier.  Subject to the terms and conditions of this Agreement,
Supplier will supply ASML with the Products and ASML will purchase the Products
  ordered from Supplier pursuant to Purchase Orders placed by ASML from time
  to time.

2.2             Supplier
  grants to ASML a nonexclusive, non-sublicensable (except to the extent sublicensing
  is necessary for the exercise by ASML of its rights to sell, offer for sale,
  import or otherwise dispose (such as renting, loaning, or evaluating) of Products),
worldwide, non-transferable, royalty-free license under all of Supplier’s
Intellectual Property Rights in the Products to make improvements, modifications,
and customizations to the Products, but not to any other product, as and to the
extent deemed necessary by ASML, in its sole discretion, in order to use, sell,
offer for sale, import and otherwise dispose of the Products, on a standalone
basis or as such Products are incorporated in other ASML products and systems.
ASML will not disclose Supplier’s
Intellectual Property Rights to any third party nor use such Supplier’s
Intellectual Property Rights, except as provided in this Section 2.2, without
Supplier’s prior written approval, which shall not be unreasonably withheld
or delayed.

 

2

 EXECUTION FORM 

3.               
ORDERS

3.1             After
  the Effective Date, ASML shall provide Supplier, in good faith, with rolling
  forecast information regarding its needs for Products. This rolling forecast
  information will be updated by ASML on a regular basis. Delivery of such forecasts
  by ASML shall not be considered a firm commitment to purchase the forecasted
  amounts by ASML nor shall receipt of such forecasts by Supplier be considered
  an agreement that Supplier will supply such forecasted Product needs or that
  the Products shown in the forecast will be available for purchase on the dates
  indicated in the forecasts.

3.2             Each
  written Purchase Order from ASML shall at a minimum specify the Product type,
  the required quantity, applicable price in accordance with the terms of this
  Agreement and the required delivery date (collectively, “Minimum Ordering
  Terms”).
Purchase Orders issued by ASML shall be deemed to have been accepted by Supplier
  [***]. Except for Minimum
Ordering Terms or as otherwise agreed by the Parties in writing, any terms
and conditions contained in a Purchase Order or in Supplier’s quotation
or order acknowledgment forms or any other documents that are inconsistent with
or in addition to the terms and conditions of this Agreement will be deemed null
and of no effect.

3.3             Supplier
  acknowledges and agrees that ASML Associated Companies may submit Purchase
  Orders to Supplier and that, subject to Supplier providing ASML with reasonable
  prior written notice and subject to ASML’s prior written consent, which
  shall not be unreasonably withheld or delayed, Supplier Associated Companies
  may fulfill such Purchase Orders, and the rights and obligations under this
  Agreement shall apply to such Purchase Orders to the same extent as if ASML
  had submitted such Purchase Orders or Supplier had fulfilled them.

4.               
DELIVERY

4.1            
Supplier shall deliver Products on the delivery date(s) indicated in the
accepted Purchase Order. Supplier acknowledges and agrees that time is of the
essence.

4.2            
Delivery of the Products shall be made [***] in accordance with [***].

4.3            
Risk of loss for and title to Products shall pass to ASML [***].

4.4            
[***]

5.               
PRICES

5.1            
The price for a Product shall be the full and complete consideration to
Supplier for the proper and complete performance of its obligations under and
arising out of this Agreement, including the Purchase Orders. [***]

5.2            
If any modifications to the Products requested by ASML pursuant to Section
11.2 will have consequences for the pricing of the Products or Spare Parts, Supplier
shall [***].

6.               
[***]

7.               
POSTPONEMENT OF DELIVERY

[***]

[***]
Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portion.

 

3

 EXECUTION FORM 

8.               
CONTINUATION

8.1            
If ASML selects Contisnuation, Supplier shall resume the production of
the Products and deliver them to ASML at the revised delivery date mutually agreed
upon by ASML and Supplier. ASML shall pay [***].

8.2            
The total holding fee [***] will be invoiced upon shipment of the Product
and shall be clearly stated on the invoice submitted to the ASML together with
the shipment.

9.               
CANCELLATION

ASML will
have the right to cancel Purchase Orders for [***].

10.            
LEAD TIME FOR PRODUCTS

10.1         
Supplier commits to deliver Products to ASML, if required by ASML, [***]
weeks after receipt of a Purchase Order from ASML. In case Supplier cannot yet
commit to a [***] weeks order lead time for a Product, Supplier shall [***].

10.2      Supplier
will inform ASML within [***] business days of receiving a Purchase Order from ASML if the Purchase Order is not accepted due to
it being inconsistent with the terms of this Agreement; otherwise, the Purchase Order shall be deemed to have been accepted.

11.            
SPECIFICATIONS AND MODIFICATIONS

11.1         
Supplier acknowledges and agrees that the Products it delivers to ASML
shall strictly conform to the applicable Technical Product Documentation (the “TPD”),
and any other mutually agreed upon requirements of ASML (the TPD and any such
mutually agreed upon requirements are referred to collectively as (the “Specifications”).

11.2         
ASML may request modifications to the TPD and/or requirements for Products,
and Supplier shall [***].

11.3         
Upon ASML’s approval provided in accordance with Section 5.2, Supplier
will implement the agreed change as soon as reasonably possible.

12.            
INSPECTION AND TESTING

12.1         
ASML reserves the right, upon reasonable written notice and during normal
business hours, to inspect the Products at Supplier’s
facility, so as to verify that the Products strictly conform to the Specifications.
If Products are found to be defective in material, function or workmanship or
otherwise not in strict conformity with the Specifications, ASML shall have the
right to reject the defective Products. Supplier shall not deliver to ASML any
of the Products which have been rejected or required to be corrected by ASML
by written notice to Supplier, unless [***]. Supplier shall work with ASML to
correct any defective or rejected Products prior to shipment.

 

 

 

[***]
Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portion.

4

 

 EXECUTION FORM 

12.2        
ASML shall conduct an incoming inspection concerning compliance with the
Specifications, defects in materials or workmanship or other discrepancy of Products
delivered or to be delivered hereunder by Supplier within [***] days after arrival
at ASML's site ("Inspection Period"). If a Product is either
found to be defective or not in strict conformity with the Specifications within
the Inspection Period, and ASML notifies Supplier of such fact within the Inspection
Period, ASML may (without prejudice to any of ASML’s rights or remedies
under this Agreement or under applicable law) reject the Product and upon both
Parties’
agreement, Supplier shall repair or replace the Product [***]. If a Product is
rejected, delivery shall be deemed not to have taken place.

13.            
WARRANTY

13.1        
Supplier hereby represents and warrants that the Products will be free
from defects in materials and workmanship and will strictly conform to the Specifications
for a period of [***] months from the acceptance date. However, the above [***]
month warranty period shall be reduced to (a) [***] months from the acceptance
date for consumable parts of the Products, i.e., those parts that are not intended
to be used indefinitely or (b) [***] months from the acceptance date for Supplier’s
standard non-optical products that are not consumable parts.

13.2        
Supplier further warrants that the Products do not infringe or misappropriate
any Intellectual Property Rights of a third party; provided, however, that Supplier
makes no representation or warranty with respect to Products built by Supplier
in accordance with designs originated solely by ASML.

13.3       
Supplier’s warranties shall not cover any non-conformity or damage
to the Products as a result of (i) inappropriate or unauthorized handling, use,
repairing, storage or maintenance by ASML, or (ii) deterioration or ordinary
wear and tear.

13.4       
EXCEPT AS SET FORTH ABOVE, SUPPLIER MAKES NO WARRANTY, EXPRESS OR IMPLIED,
OF ANY NATURE WHATSOEVER AND INCLUDING, WITHOUT LIMITATION, ANY WARRANTY OF MERCHANTABILITY
OR FITNESS FOR A PARTICULAR PURPOSE.

13.5         
ASML shall send Supplier written notice of any claims under this Section
within [***] weeks after it has detected the defect or non-conformity.

13.6        
Returns: If ASML determines that a Product does not comply with
the warranty set forth in Section 13.1 (the “Product
Specifications Warranty”), ASML may return such Product to Supplier.
ASML will comply with Supplier’s standard
RMA procedure. ASML will provide Supplier with a Return Purchase Order (“Return
PO”) not less than [***] business
days prior to return of the Product to Supplier. The Return PO will be for an
amount [***].

13.7        
Supplier’s Response: Within [***] business days after receipt
of a returned Product, Supplier must confirm or reject whether the Product complies
with the Product Specifications Warranty. Failure to respond within such [***]
business day period will be considered confirmation that the returned Product
does not comply with the Product Specifications Warranty. Supplier may reject
a returned Product only if can demonstrate that the returned Product complies
with the Product Specifications Warranty. Supplier will communicate such confirmation
or rejection through ASML’s “Q Portal” or, if Supplier
has not been given access to the Q Portal, via email to the ASML contact name
listed in the Return PO.

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treatment has been requested with respect to the omitted portion.

 

5

 EXECUTION FORM 

13.8         Credit
    for Confirmed Warranty Returns: Supplier will issue a credit
note to ASML for the full value of the Return PO within [***] business days of
Supplier’s confirmation that a returned Product does not comply with the
Product Specifications Warranty. Instructions on transmitting the credit note
will be contained in the Return PO, or otherwise communicated by ASML. ASML will
subsequently, within a reasonable time frame, issue a new purchase order requirement
for another unit of the same Product so that the total quantity purchased nets
out to be the same as if ASML had not returned such Product.

13.9         Returned
    Product not under Warranty: [***]

13.10      Repaired
    Product: Supplier must provide the following information
for any Product that is repaired and subsequently shipped back to ASML.

13.11      
1 - Product Serial Number.

13.12      
2 - Material Notification number under which the Product was originally
returned

13.13      
3 – Detailed description of what was done to repair the Product
to so that it complies with the Product Specifications Warranty

14.             CONTINUED
      SUPPLY

14.1         Supplier
  commits to supplying to ASML each Product until the end of a period of [***]
  years after the date of the first delivery to ASML of such Product. If during
  such [***] year period Supplier nevertheless determines that it will no longer
  be able to continue to supply the respective Products, Supplier shall inform
  ASML in writing as soon as reasonably practicable but in no case with less
  than [***] months advanced written notice of termination of such supply. [***]

14.2         Supplier
  shall be capable of supporting the Spare Parts and to supply those to ASML
  until the end of the period of [***] years after the last delivery to ASML
  of a Product to which the Spare Part relates. If during the applicable [***]
  year period Supplier determines that it will no longer be able to continue
  to supply the Spare Parts, Supplier shall inform ASML in writing as soon as
  reasonably practicable but in no case with less than [***] months advance written
  notice of termination of such supply.

15.             INDEMNIFICATION

15.1         Supplier
  will defend, hold harmless and indemnify, including attorney's fees, ASML and
  ASML’s personnel against third
party claims that arise or are alleged to have arisen as a result of negligent
or intentional acts or omissions of Supplier or Supplier’s personnel (including
contractors).

15.2         Supplier
  shall defend, indemnify and hold ASML harmless against all fines, losses, damages,
  costs and expenses incurred by ASML, arising directly or indirectly from a
  claim brought by a third party claiming that the manufacture, sale, use or
  any other disposal by Supplier or by ASML or by any of its customers of a Product
  delivered hereunder or any part thereof, or of equipment incorporating such
  Products, constitutes or may constitute infringement of one or more Intellectual
Property Rights of such third party; provided that (a) such claims are not the
result of the implementation of a design originated solely by ASML or

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6

 EXECUTION FORM 

(b) such claims are
not the result of ASML’s design of the of its equipment into which the Product is incorporated, provided that Supplier did
not contribute to such design; and provided further, that ASML gives Supplier (i) written notice of any such claim; (ii) authority
to either settle or defend such claim; and (iii) all reasonable cooperation and assistance, all at Supplier’s cost. Supplier
will not enter into any settlement or compromise or engage in any defense that includes an admission of liability as to ASML or
obligates ASML to make any payments to such third party or otherwise results in prejudice to, or adversely affects, ASML, without
ASML’s express prior written consent.

15.3         ASML
  shall indemnify and hold Supplier harmless against all fines, losses, damages,
  costs and expenses incurred by Supplier, arising directly or indirectly from
  a claim brought by a third party that the manufacture, sale, use or any other
  disposal by Supplier or by ASML or by any of its customers of a Product delivered
  hereunder or any part thereof, or of equipment incorporating such Products,
constitutes or may constitute infringement of one or more Intellectual Property
Rights of such third party; provided that such claims are result of the implementation
of a design originated solely by ASML; and provided further, that Supplier gives
ASML (i) written notice of any such claim; (ii) authority to either settle
or defend such claim; and (iii) all reasonable cooperation and assistance, all
at ASML’s cost. ASML will not enter into any settlement or compromise or
engage in any defense that includes an admission of liability as to Supplier
or obligates Supplier to make any payments to such third party or otherwise results
in prejudice to, or adversely affects, Supplier, without Supplier’s express
prior written consent.

15.4         If
  the sale, use or other disposal of the Product is enjoined or ASML reasonably
  believes that such enjoinment is possible, then Supplier shall, at its option
  and expense, either procure for ASML and its customer(s) the right to continue
  to make, use, sell, offer for sale, import or otherwise dispose of such Product
  or replace such Product with a non-infringing modification to be approved in
  writing by ASML; provided that the Product continues to comply
with the Performance Specification Warranty.

16.             ASSIGNMENT
      AND SUBCONTRACTING

16.1         Neither
  Party may assign or transfer a right or obligation under this Agreement and/or
  a Purchase Order without the prior written consent of the other Party.

17.             INVOICES
      AND PAYMENT

17.1         Unless
  stated otherwise by ASML, Supplier shall submit invoices in PDF format (or
  other non-editable formats) directly to ASML-invoiceUS@cocq.de which is ASML's
  document handling center for electronic processing.

17.2         Invoices
  may only be sent to ASML upon delivery of the respective Products at the agreed
  place. Advance invoicing by Supplier is not allowed.

17.3         Invoices
  shall at least state the name and number of this Agreement, the Purchase Order
  number, type of Product, quantity and price and the number of the document(s)
  by which the Products, to which the invoice relates, were transferred to ASML.

17.4         Payment
  shall be made within [***] days end of month.

 

 

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7

 EXECUTION FORM 

18.             TERM
      AND TERMINATION

18.1        This
  Agreement shall be effective from the Effective Date and shall continue in
  effect for an initial term of three (3)
years. Thereafter, this Agreement shall be extended automatically for additional
successive two (2) year terms, unless either
Party gives written notice of termination to the other Party no less than twelve (12)
months prior to expiration of the original term or any successive term. Termination
of this Agreement shall be without prejudice to any other remedies a Party may
have hereunder or under applicable law.

18.2         If
  a Party (the “Defaulting Party”) is not able to remedy any
  material breach of this Agreement within [***] days after the date on which
  that written notice has been sent (or within such other extended period the
  Parties may mutually agree upon), the non-Defaulting Party has the right to
  terminate this Agreement and/or any outstanding Purchase Orders in whole or
  in part at the end of the [***] days period by written notice to the Defaulting
  Party. The non-Defaulting has this right without prejudice to any other rights
  or claims accruing under this Agreement or in law.

18.3        This
  Agreement may be terminated with immediate effect by one Party in the event
  that:

(a)             the
  other Party shall cease to carry on business in the normal course; or

(b)             the
  other Party becomes insolvent or bankrupt; or

(c)            
the other Party makes a general assignment for the benefit of its
creditors, or

(d)             the
  other Party suffers or permits the appointment of a receiver or a manager for
  its business assets or avails itself or becomes subject to any proceeding under
  bankruptcy laws or any other statute or laws relating to the insolvency of
  protection of the right of creditors; or

(e)             control
  over one Party shall be or is transferred to others than those exercising control
  at the Effective Date and such transfer is, in the reasonable opinion of the
  other Party materially detrimental or potentially materially detrimental to
  its reasonable business interests.

18.4        If
  any of the termination grounds mentioned in Section 18.3 occur,
a Party shall as soon as reasonably practicable inform the other Party in writing.

18.5        If
  this Agreement is terminated or cancelled, whatever the reason, Sections intended
  by their nature to survive the termination of this Agreement (e.g., warranties,
  indemnities, provisions related to Purchase Orders, etc.) shall survive such
  termination or cancellation.

19.             
CONFIDENTIALITY

19.1          Each
  Party on behalf of itself and its Associated Companies agrees that, unless
  the disclosing Party gives its prior written authorization, it shall that during
  the term of this Agreement and thereafter:

(a)              protect
  the other Party's Confidential Information against disclosure in the same manner
  and with the same degree of care, but not less than a reasonable degree of
  care, with which it protects confidential information of its own;

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treatment has been requested with respect to the omitted portion.

8

 

 EXECUTION FORM 

(b)             
limit circulation of the Confidential Information disclosed by the other
Party to such employees and subcontractors as have a need to know solely for
the execution of its respective obligations under this Agreement and only after
having bound such employees and third parties to confidentiality obligations
no less restrictive than it has agreed upon in this Agreement; and

(c)             
not use the Confidential Information disclosed by the other for any purpose
other than for the purpose of exercising its respective rights and performing
its respective obligations under this Agreement.

19.2        
The Parties, on behalf of themselves and their Associated Companies agree
that information disclosed by any Party pursuant to this Agreement which would
otherwise be Confidential Information, shall not be deemed Confidential Information
to the extent the receiving Party can prove that said information:

(a)             
is part of the public domain without violation of this Agreement; or

(b)            
was rightfully known by the receiving Party prior to disclosure by the
disclosing Party, without an obligation of confidentiality (excluding Confidential
Information included in the Acquired Assets acquired by Supplier from ASML);
or

(c)             
was lawfully obtained by the receiving Party from a third party not bound
by confidentiality obligations; or

(d)             
was developed by the receiving Party completely independent of any such
disclosure by the disclosing Party; or

(e)            
is disclosed pursuant to administrative or judicial action, provided that
the receiving Party shall use its commercially reasonable efforts to maintain
the confidentiality of the Confidential Information, e.g., by asserting in such
action any applicable privileges, and shall, unless prohibited by applicable
law, immediately after receiving written notice of such action, notify the disclosing
Party thereof and give the disclosing Party the opportunity to seek any other
legal remedies so as to maintain such Confidential Information in confidence.

20.            
LIMITATION OF LIABILITY

20.1        
EXCEPT FOR EACH PARTY’S LIABILITY UNDER SECTION 15 (INDEMNIFICATION)
AND EXCEPT FOR EACH PARTY’S LIABILITY
RESULTING FROM A BREACH OF SECTION19 (CONFIDENTIALITY), IN NO EVENT SHALL EITHER
PARTY BE LIABLE TO THE OTHER PARTY FOR ANY INDIRECT, SPECIAL, INCIDENTAL OR CONSEQUENTIAL
LOSS OR DAMAGE, OR LOSS OF PROFIT, LOSS OF REVENUE, LOSS OF BUSINESS, LOSS OF
CONTRACT OR LOSS OF OTHER ECONOMIC ADVANTAGE, ARISING OUT OF OR IN CONNECTION
WITH THIS AGREEMENT OR THE MANUFACTURE, SALE, SUPPLY OR USE OF THE PRODUCTS OR
ANY SERVICE PROVIDED UNDER THIS AGREEMENT, EVEN IF THE OTHER PARTY HAS PREVIOUSLY
BEEN ADVISED OF THE POSSIBILITY OF THE SAME.

20.2        
Nothing in this Agreement shall have the effect of limiting or excluding
either Party’s liability for death or personal
injury resulting from its own negligence, or any other liability, if and to the
extent that the same may not be limited or excluded as a matter of law.

9

 EXECUTION FORM 

21.            
ENVIRONMENT, HEALTH AND SAFETY

21.1         Supplier
  shall fully comply with all applicable international and national laws and
  regulations, including but not limited to, all environment, health and safety
  (“EHS”) related laws and regulations in the performance of
its obligations under this Agreement. Supplier shall have in place decision,
management, control and continuous improvement systems to effectively manage
safety.

21.2         Supplier
  agrees to abide by all ASML's rules and regulations (of which it has received
  prior notice in writing) while on ASML’s premises. Supplier
shall take all reasonable precautions to ensure safe working procedures and conditions
for performance while on ASML's premises and shall keep ASML's site tidy and
free from debris. ASML shall provide a work environment that is legally compliant
with applicable laws and regulations for all of Supplier’s employees or
contractors which perform work on ASML’s
premises.

22.            
GENERAL

22.1        Unless
  otherwise provided elsewhere, Parties shall send all correspondence relating
  to this Agreement to the contact person indicated below:

	

        If to ASML:

         
	 	If to Supplier:
	ASML U.S. Inc..	 	Zygo Corporation
	Attn: Larry Hart	 	Attn: John Stack
	77 Danbury Rd.	 	Laurel Brook Road
	Wilton, CT 06897	 	P.O. Box 448
	 	 	Middlefield, CT  06455-0448
	Email: larry.hart@asml.com	 	Email: jstack@zygo.com

 

22.2        This
  Agreement, including all exhibits, along with the provisions of the Asset Purchase
  Agreement referred to herein, constitute the entire agreement between the Parties
  regarding the subject matter hereof, and supersedes all prior agreements, understandings,
  negotiations and discussions, whether oral or written, between the Parties
  regarding such subject matter. No amendment to or modification of this Agreement
  will be binding unless in writing and signed by a duly authorized representative
  of each Party.

23.            
APPLICABLE LAW, ARBITRATION

23.1        The
  validity, construction and performance of this Agreement shall be governed
  by and construed in accordance with the laws of the State of New York, excluding
  that body of laws known as conflicts of law. The application of the United
  Nations Convention on Contracts for the International Sale of Goods shall be
  excluded.

23.2         Any
  dispute, controversy or claim arising under, out of or relating to this Agreement,
  including without limitation its validity, interpretation, performance, breach
  or termination thereof, will be settled by final and binding arbitration in
  New York, New York in accordance with (i) the then-current Commercial Arbitration
Rules of the American Arbitration Association (the (“Rules”)
and (ii) the terms of this Agreement. The terms of this Agreement will control
in the event of any inconsistency between such terms and the Rules. The arbitration
will be conducted before a panel of three arbitrators reasonably familiar with
the technology and business covered by this Agreement. Each of the Parties shall
designate one arbitrator and the two arbitrators so designated shall select the
third arbitrator. The arbitration proceeding and all pleadings and written evidence
will be in the English language. The award of the arbitrator will be in writing
setting forth findings of fact and conclusions of law. Judgment on the arbitrator's
award will be final and binding upon the Parties and may be entered in any court
having jurisdiction thereof. The arbitrator’s
fees will be shared

10

 EXECUTION FORM 

equally by the Parties and each Party will bear its own costs and attorneys’ fees. All papers, documents,
or evidence, whether written or oral, filed with or presented in connection with the arbitration proceeding will be deemed by the
Parties and by the arbitrator to be Confidential Information of both Parties. Notwithstanding the foregoing provisions, each Party
reserves the right to seek injunctive or other equitable relief in a court of competent jurisdiction with respect to any dispute,
controversy or claim related to the actual or threatened infringement, misappropriation or violation of a Party’s Intellectual
Property Rights or Confidential Information.

23.3           
If any provision of this Agreement is held invalid or unenforceable by a court of competent jurisdiction, then such provision
will automatically be adjusted to the minimum extent necessary in order to comply with the requirements for validity or enforceability,
and as so adjusted, will be deemed a provision of this Agreement as though originally included herein. In the event that the provision
held invalid or unenforceable is of such a nature that it cannot be so adjusted, such provision will be deemed deleted from this
Agreement as though such provision had never been included herein. In either case, the remaining provisions of this Agreement will
remain in full force and effect.

23.4           
The failure by either Party to enforce any provision of this Agreement will not constitute a waiver of future enforcement
of that or any other provision. The waiver of any provision of this Agreement will only be effective if in writing and signed by
the Party waiving such provision. Section headings are a matter of convenience and will not be considered part of this Agreement.
This Agreement has been negotiated by the Parties, which have had reasonable access to legal counsel. This Agreement will be fairly
interpreted in accordance with its terms, without any construction in favor of or against either Party as a result of having drafted
any particular provision.

23.5           
This Agreement may be executed in counterparts, each of which will be deemed an original, but all of which together will
constitute one and the same instrument.

IN WITNESS whereof, this Agreement has been
signed on behalf of the Parties hereto in two counterparts by persons duly authorized in that behalf.

 

 

	
        ASML US, Inc.

         
	 	Zygo Corporation
	By:	 	By:
	Title:	 	Title:

11

 EXECUTION FORM 

Exhibit
1 – [***]

 

[***]

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

[***]
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treatment has been requested with respect to the omitted portion.

12

EXHIBIT 2 – PRODUCTS

 

 

	 	Leadtime in Weeks (5days)

	Material 12NC	Description	Price (USD)	Procured	Fabrication	Total
	 	 	 	Material
	 	 	 	 	 	 
	4022.484.85342	[***]	[***]	[***]	[***]	[***]
	4022.486.91747	[***]	[***]	[***]	[***]	[***]
	4022.631.88373	[***]	[***]	[***]	[***]	[***]
	4035.200.19131	[***]	[***]	[***]	[***]	[***]
	4035.200.11102	[***]	[***]	[***]	[***]	[***]
	4035.200.11111	[***]	[***]	[***]	[***]	[***]
	4022.620.10751	[***]	[***]	[***]	[***]	[***]
	4022.620.12212	[***]	[***]	[***]	[***]	[***]
	4022.620.40201	[***]	[***]	[***]	[***]	[***]
	4022.620.14824	[***]	[***]	[***]	[***]	[***]
	4035.200.21282	[***]	[***]	[***]	[***]	[***]
	4035.200.21292	[***]	[***]	[***]	[***]	[***]
	4035.200.21302	[***]	[***]	[***]	[***]	[***]
	4035.200.21312	[***]	[***]	[***]	[***]	[***]
	4035.200.21322	[***]	[***]	[***]	[***]	[***]
	4035.200.39221	[***]	[***]	[***]	[***]	[***]
	4035.200.39261	[***]	[***]	[***]	[***]	[***]
	4035.200.39341	[***]	[***]	[***]	[***]	[***]
	4035.200.39401	[***]	[***]	[***]	[***]	[***]
	4035.200.39411	[***]	[***]	[***]	[***]	[***]
	 	 	 	 	 	 
	The pricing above lists the Richmond content for each 12NC listed. Separate 12NC's  will be created for Richmond content.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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treatment has been requested with respect to the omitted portion.

EXECUTION FORM 

EXHIBIT C

LICENSE AND SUPPORT AGREEMENT

          This
License and Support Agreement (this “Agreement”) is entered into as of October
____, 2010 (the “Effective Date”), by and between Zygo
Corporation, a Delaware corporation having a place of business at Laurel Brook
Road, Middlefield, Connecticut (“Zygo”), ASML US, Inc., a Delaware
corporation, having a place of business at 77 Danbury Road, Wilton, Connecticut
(“ASML”), and ASML Holding NV, a company organized under the laws of The
Netherlands having a place of business at De Run 6501, 5504 DR Veldhoven, The
Netherlands (“ASML NV”).  

RECITALS

          A.          Zygo
and ASML have entered into that certain Asset Purchase Agreement, on even date
herewith (the “APA”), pursuant to which ASML is selling and transferring, and
Zygo is purchasing and acquiring, the Acquired Assets, and ASML is assigning
and Zygo is assuming the Assumed Liabilities, of the Richmond, California
operations of ASML (the “Business”), as of the date hereof and upon and subject
to the terms set forth in the APA.  

          B.          Some
of the Intellectual Property (all of which by definition is included in the
Acquired Assets) is used by businesses of ASML other than the Business. 

          C.          Some
ASML and ASML NV intellectual property rights, including patent rights, not
included in the Acquired Assets have been used by ASML in connection with the
Acquired Assets and may continue to be used by Zygo in connection with the
Acquired Assets after the Closing. 

          D.          As
a result, the parties desire for Zygo to grant to ASML, and for ASML and ASML
NV to grant to Zygo, certain license rights and support from and after the
Closing. 

          NOW
THEREFORE, in consideration of the following mutual covenants and promises, the
parties agree as follows: 

AGREEMENT

1.          DEFINITIONS.
Capitalized terms not defined in this Agreement will have the meaning given to
them in the APA. As used herein, the term “ASML Business Activities”
means the business of designing, developing, demonstrating, manufacturing
(including having manufactured), using, marketing, offering for sale, selling,
importing, exporting, licensing and/or servicing, maintaining and supporting
semiconductor capital equipment, optical components and optical systems, and
related processes and services. 

2.          CCOS
SUPPORT. The parties acknowledge that certain of ASML’s businesses, other
than the Business, currently own and operate the CCOS (computer controlled
optical surfacing) equipment identified in Exhibit A (the “CCOS
Equipment”), which was developed, manufactured and supported by the
Business prior to the Closing and which is not included in the

1

EXECUTION FORM 

Acquired
Assets. Accordingly, the parties agree that Zygo will provide on-going support
for such CCOS Equipment as set forth in Exhibit B. Zygo hereby grants to ASML a
non-exclusive, non-sublicensable, royalty-free, fully paid-up, perpetual and
irrevocable license to the CCOS technology included in the Acquired Assets (including
improvements thereto made after the Closing, to the extent delivered to ASML as
part of such support ) for use solely internally by ASML.  

3.          ADDITIONAL
SUPPORT. The parties acknowledge that prior to the Closing, the Business
developed certain process know-how, including processes for ion beam figuring
(“IBF”) and advanced glass machining, which know-how is included in the
Acquired Assets (the “Business Know-How”). The Business Know-How may be
useful to ASML in developing processes for ASML Business Activities. If ASML
decides to independently develop processes for ASML Business Activities using
the Business Know-How and decides it would be beneficial for certain Zygo
employees with knowledge of the Business Know-How to provide technical support
in developing these processes, ASML may send written request to ZYGO, detailing
the need and extent of support requested. Zygo will use commercially reasonable
efforts to make such employees (if they remain in the employ of Zygo)
available, to provide such technical support to ASML (including on-site at ASML
if requested), at a cost not to exceed Zygo’s then-standard billing rates plus
actual expenses (e.g., food, lodging, travel) approved by ASML, for a period of
three years from the Effective Date. After such date if ASML requests such
continuing technical support, Zygo will negotiate with ASML in good faith with
respect to the provision of such technical support. Zygo hereby grants to ASML
a non-exclusive, non-sublicensable, royalty-free, fully paid-up, perpetual and
irrevocable license to the Business Know-How, for use solely internally by
ASML.  

          For
example, certain Zygo employees may have expertise in IBF processes included in
the Business Know-How. If ASML in the future buys an IBF machine, it may be
useful to ASML, under this Section 3, for such employees to provide technical
support to ASML in developing processes for the IBF machine purchased by ASML.
Note, however, that this Section 3 does not give ASML any rights to the
proprietary IBF machines included in the Acquired Assets, nor does it give ASML
a right to purchase any of the IBF machines included in the Acquired Assets or
to gain access to the designs of any IBF machine owned by Zygo after the
Closing. 

4.          FURTHER
LICENSE OF INTELLECTUAL PROPERTY. In furtherance of and in addition to the
foregoing, Zygo hereby grants to ASML a non-exclusive, non-sublicensable,
royalty-free, fully paid-up, perpetual and irrevocable license to the
Intellectual Property, solely for use internally by ASML. 

5.          LICENSE
TO ELECTROSTATIC CLAMP. Zygo hereby grants to ASML a non-sublicensable,
royalty-free, fully paid-up, perpetual and irrevocable license to the
electrostatic clamp and chuck process technology acquired from ASML as part of
the Acquired Assets (including improvements thereto made after the Closing to
the extent disclosed to ASML, and all Intellectual Property therein) (the “ESC
Process Technology”). The parties acknowledge that the electrostatic clamp
and chuck product designs are not part of the Acquired Assets or ESC Process
Technology and ASML’s use of the product designs are not subject to the
restrictions in this

2

EXECUTION FORM 

Section 5. For
a period of five (5) years from the Effective Date, ASML wishes that the ESC Process
Technology is not used or incorporated for any vacuum-based lithography systems
other than those produced for ASML or ASML NV. To prevent uses of the ESC
Process Technology contrary to ASML’s wish, during such period of five (5)
years, prior to providing directly or indirectly any products and/or services
using or incorporating the ESC Process Technology, Zygo will inquire as to
whether such products and/or services are for vacuum-based lithography systems
and shall not knowingly use or incorporate, directly or indirectly, the ESC
Process Technology (including any improvements thereto) for any vacuum-based
lithography systems other than those produced for ASML or ASML NV. ASML’s
license rights to the ESC Process Technology under this Section 5 are limited
solely for use internally by ASML, except that any ESC Process Technology used
in ASML Business Activities outside of ASML prior to the Closing, and
identified in Exhibit D, may continue to be used in the same scope and
manner in such identified ASML Business Activities outside of ASML after the
Closing. If ASML decides it would be beneficial for certain Zygo employees with
knowledge of the licensed ESC Process Technology to provide technical transfer
and support of the licensed ESC Process Technology to ASML after Closing, ASML
may send written request to Zygo, detailing the need and extent of support
requested. Zygo will use commercially reasonable efforts to make such employees
(if they remain in the employ of Zygo) available to provide such technical
transfer and support of the licensed ESC Process Technology to ASML (including
on-site at ASML if requested), at a cost not to exceed Zygo’s then-standard
billing rates plus actual expenses (e.g., food, lodging, travel) approved by
ASML, for a period of three years from the Effective Date. 

6.          PATENT
LICENSE. ASML and ASML NV hereby grant to Zygo a non-exclusive,
non-sublicensable, royalty-free, fully paid-up, perpetual and irrevocable
license under the patent applications listed in Exhibit C-1, including
any patents resulting from any of the foregoing applications, and all patent
applications and patents claiming priority to the above applications (including
any divisional, continuation, continuation-in-part, substitute, renewal and
reissue applications therefrom) (collectively, the “Patent Rights”)
solely for use in the Business as operated at the Closing or any time during
the six (6) months prior to Closing. Notwithstanding the foregoing, this
license does not extend to any activities prohibited under Section 5 above. 

          For
three (3) years after the Effective Date, if Zygo can document that additional
patent rights owned by ASML or ASML NV at the time of Closing and naming at
least one inventor from the Business were used in the Business at the Closing
or any time during the six (6) months prior to Closing, Zygo may send written
notice to ASML. The written notice will include Zygo’s documentation and claim
charts based on Zygo’s documentation. ASML will reasonably consider the notice and
if ASML agrees with Zygo, then the additional patent rights will be added to Exhibit
C-1 by written amendment, provided that ASML has the rights to do so and
without additional cost to ASML. If ASML does not agree, either party may
request to resolve the disagreement according to the dispute resolution process
in this Agreement. 

          For
three (3) years after the Effective Date, if Zygo can document that additional
patent rights owned by ASML at the time of Closing and not naming at least one
inventor from the Business were used in the Business at the Closing or any time
during the six (6) months prior to Closing, Zygo may send written notice to
ASML. The written notice will include Zygo’s documentation and claim charts
based on Zygo’s documentation and a representation that Zygo 

3

EXECUTION FORM 

has not and
will not be using the patented technology for the benefit of ASML competitors
or their Affiliates for vacuum-based lithography systems. ASML will reasonably
consider the notice and if ASML agrees with Zygo, then the additional patent
rights will be added to Exhibit C-1 by written amendment, provided that
ASML has the rights to do so and without additional cost to ASML and further
provided that Zygo’s license under such additional patents will exclude any
activity for the benefit of ASML competitors or their Affiliates, for
vacuum-based lithography systems. If ASML does not agree, either party may
request to resolve the disagreement according to the dispute resolution process
in this Agreement. 

7.          NON-PATENT
LICENSE. ASML and ASML NV hereby grant to Zygo a non-exclusive,
non-sublicensable, royalty-free, fully paid-up, perpetual and irrevocable
license under the non-patent technology listed in Exhibit C-2 (the “Technology
Rights”) solely for use in the Business as operated at the Closing or any
time during the six (6) months prior to Closing. Notwithstanding the foregoing,
this license does not extend to any activities prohibited under Section 5
above.  

              For
three (3) years after the Effective Date, if Zygo can document that additional
trade secrets, know-how or other non-patent technology rights owned by ASML at
the time of Closing were used in the Business at the Closing or any time during
the six (6) months prior to Closing, Zygo may send written notice to ASML. The
written notice will include Zygo’s documentation and basis for its belief. ASML
will reasonably consider the notice and if ASML agrees with Zygo, then the
additional technology rights will be added to Exhibit C-2 by written
amendment, provided that ASML has the rights to do so and without additional
cost to ASML. If ASML does not agree, either party may request to resolve the
disagreement according to the dispute resolution process in this Agreement. 

8.          AFFILIATES.
Each license granted to a party under this Agreement also extends to Affiliates
of that party. “Affiliate” of a party means any entity which is directly
or indirectly controlling, controlled by or under direct or indirect common
control with the party. As used in this definition, “control” of an entity
means having (i) direct or indirect ownership of more than fifty percent (50%)
of the voting equity or beneficial interest of such entity, (ii) the right to
vote for or appoint at least fifty percent (50%) of the board of directors or
other governing body of such entity, or (iii) management or operational control
of such entity. 

9.          CONFIDENTIALITY;
RESTRICTIVE COVENANTS. The confidentiality provisions set forth in Section
7.5 of the APA and the non-solicitation covenant set forth in Section 7.12 of
the APA (including the remedies for breach set forth in the APA), are hereby
incorporated by reference as if fully set forth herein, and shall be applicable
to the conduct of the parties hereto with respect to this Agreement. 

10.          RESERVATION
OF RIGHTS. Except for those license rights expressly granted in this
Agreement, Zygo is not in this Agreement granting license rights in its
Intellectual Property to ASML or its Affiliates, and neither ASML nor ASML NV
is in this Agreement granting license rights in its intellectual property to
Zygo and its Affiliates. Each party reserves all other rights and licenses in
and to its intellectual property not expressly granted to the other party under
this Agreement. 

4

EXECUTION FORM 

11.          LIMITATION
OF LIABILITY. IN NO EVENT WILL EITHER PARTY BE LIABLE TO THE OTHER FOR LOST
PROFITS, LOST BUSINESS, OR ANY CONSEQUENTIAL, EXEMPLARY OR INCIDENTAL DAMAGES
ARISING OUT OF OR RELATING TO THIS AGREEMENT, REGARDLESS OF WHETHER BASED IN
CONTRACT OR TORT, EVEN IF ADVISED OF THE POSSIBILITY OF SUCH DAMAGES, EXCEPT
WITH RESPECT TO ANY VIOLATION OF SECTION 5 OR 9 HEREOF AND IN THE CASE OF
FRAUD. THE LICENSES GRANTED PURSUANT TO THIS AGREEMENT ARE GRANTED ON AN “AS
IS” BASIS. NO PARTY HERETO MAKES ANY WARRANTIES OF ANY KIND WITH RESPECT TO
SUCH LICENSES, EITHER EXPRESS OR IMPLIED, AND ALL SUCH WARRANTIES ARE EXPRESSLY
DISCLAIMED. NO PARTY HERETO MAKES ANY REPRESENTATION OR WARRANTY WITH RESPECT
TO THE MAINTENANCE, VALIDITY, ENFORCEABILITY OR NONINFRINGEMENT OF THE PATENT
RIGHTS LICENSED UNDER THIS AGREEMENT. EACH PARTY’S LIABILITY UNDER THIS
AGREEMENT WILL FURTHER BE LIMITED BY ANY LIMITATIONS IN THE APA THAT ON ITS
TERMS WOULD APPLY TO THIS AGREEMENT. 

12.          GENERAL.
This Agreement will be governed by and construed and interpreted in accordance
with the internal laws of the State of Delaware, excluding that body of law
applicable to conflict of laws. No waiver, amendment or modification of any
provision hereof or of any right or remedy hereunder will be effective unless
made in writing and signed by the party against whom such waiver, amendment or
modification is sought to be enforced. No failure by any party to exercise, and
no delay by any party in exercising, any right, power or remedy with respect to
the obligations secured hereby will operate as a waiver of any such right,
power or remedy. Either party may assign this Agreement or any right or
obligation hereunder, to a successor-in-interest in connection with an
acquisition, merger, or sale of all or substantially all of the business to
which this Agreement relates. This Agreement will be binding upon and inure to
the benefit of the successors and the permitted assigns of the respective
parties hereto. If any provision of this Agreement is declared by a court of
competent jurisdiction to be invalid, void, or unenforceable, the parties will
modify such provision to the extent possible to most nearly effect its intent.
This Agreement and the provisions of the APA and the Purchaser Supply Agreement
referred to herein constitute the entire understanding and agreement of the
parties hereto with respect to the subject matter hereof and supersedes all
prior agreements or understandings, written or oral, between the parties hereto
with respect to the subject matter hereof. 

13.          ARBITRATION.
Any dispute, controversy or claim arising under, out of or relating to this
Agreement, including without limitation its validity, interpretation,
performance, breach or termination thereof, will be settled by final and
binding arbitration in New York, New York in accordance with (i) the
then-current Commercial Arbitration Rules of the American Arbitration
Association (the (“Rules”) and (ii) the terms of this Agreement (including any
terms of the APA referred to herein). The terms of this Agreement will control
in the event of any inconsistency between such terms and the Rules. The
arbitration will be conducted before a panel of three arbitrators reasonably
familiar with the technology and business covered by this Agreement. Each of
the parties shall designate one arbitrator and the two arbitrators so
designated shall select the third arbitrator. The arbitration proceeding and
all pleadings and written evidence will be in 

5

EXECUTION FORM 

the English
language. The award of the arbitrator will be in writing setting forth findings
of fact and conclusions of law. Judgment on the arbitrator’s award will be
final and binding upon the parties and may be entered in any court having
jurisdiction thereof. The arbitrator’s fees will be shared equally by the
parties and each party will bear its own costs and attorneys’ fees. All papers,
documents, or evidence, whether written or oral, filed with or presented in
connection with the arbitration proceeding will be deemed by the parties and by
the arbitrator to be Confidential Information of both parties. Notwithstanding
the foregoing provisions, each party reserves the right to seek injunctive or
other equitable relief in a court of competent jurisdiction with respect to any
dispute, controversy or claim related to the actual or threatened infringement,
misappropriation or violation of a party’s intellectual property or
Confidential Information. 

IN WITNESS
WHEREOF, the parties hereto have executed this Agreement by their duly
authorized representatives effective as of the Effective Date. 

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 Zygo
 Corporation

 	
  

 	
 ASML US,
 Inc.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 By:

 	
  

 	
  

 	
 By:

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 Print Name:

 	
  

 	
  

 	
 Print Name:

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 Print Title:

 	
  

 	
  

 	
 Print Title:

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
 ASML Holding
 NV

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
 By:

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
 Print Name:

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
 Print Title:

 	
  

 

6

EXECUTION FORM 

EXHIBIT C-1

LICENSED PATENTS

	
  

 	
  

 	
  

 	
  

 
	
 Country

 	
 Application No.

 	
 Publication No.

 	
 Title

 
	
  

 	
  

 	
  

 	
  

 
	
 US

 	
 11/798,335

 	
 2008-0280539

 	
 Optical component fabrication using

 
	
  

 	
  

 	
  

 	
 amorphous oxide coated substrates

 
	
  

 	
  

 	
  

 	
  

 
	
 US

 	
 12/119,112

 	
 2008-0318066

 	
 Optical Component Fabrication Using

 
	
  

 	
  

 	
  

 	
 Coated Substrates

 
	
  

 	
  

 	
  

 	
  

 
	
 JP

 	
 2008-123970

 	
 2008-282019

 	
 Optical Component Fabrication Using

 
	
  

 	
  

 	
  

 	
 Coated Substrates

 
	
  

 	
  

 	
  

 	
  

 

7

EXECUTION FORM 

EXHIBIT C-2

LICENSED KNOW-HOW AND TECHNOLOGY

None
identified at time of Closing. 

8

EXECUTION
FORM

EXHIBIT
D

BILL OF SALE AND
ASSIGNMENT

          This
Bill of Sale and Assignment is executed and delivered pursuant to, and in
furtherance of, the Asset Purchase Agreement (the “Asset Purchase Agreement”),
made as of October ___, 2010, by and among Zygo Richmond Corporation, a
Delaware corporation (the “Purchaser”), Zygo Corporation, a Delaware
corporation, and ASML US, Inc., a Delaware corporation (the “Seller”).
Capitalized terms used and not otherwise defined herein shall have the meanings
given to such terms in the Asset Purchase Agreement.  

          The
Seller, for good and valuable consideration, the receipt and adequacy of which
are hereby forever acknowledged and confessed, does hereby SELL, CONVEY,
ASSIGN, TRANSFER and DELIVER unto the Purchaser all of the Seller’s right,
title and interest in and to all of the Acquired Assets, including, without
limitation, the Acquired Assets described on Schedules 2.1(a)(i), 2.1(a)(ii),
and 2.1(d) to the Asset Purchase Agreement and the following assets used in the
past or current conduct of the Business, free and clear of all Liens and
liabilities, other than Permitted Liens and Assumed Liabilities:

          (a)          (i)
the tangible personal property and leasehold improvements, including machinery,
equipment (including computer equipment), tools, furniture, fixtures,
furnishings and shelving located at the Richmond Facility, all as set forth on
the fixed asset register attached as Schedule 2.1(a)(i) to the Asset Purchase
Agreement, and (ii) all inventory of the Business located at the Richmond
Facility, consisting of materials and work in progress, but excluding obsolete
inventory and finished goods, all as set forth on Schedule 2.1(a)(ii) to the
Asset Purchase Agreement;

          (b)          all
right, title and interest in (i) the Owned Real Property and Improvements and
(ii) all surveys, plans, specifications, operating manuals, warranties and
guarantees covering the Improvements;

          (c)          all
cash generated by the Purchaser’s operation of the Acquired Assets after the
Closing Date;

          (d)          all
of the Seller’s rights under the contracts listed on Schedule 2.1(d) to the
Asset Purchase Agreement;

          (e)          all
Intellectual Property, goodwill associated therewith, licenses and sublicenses
granted to the Seller in respect thereto and rights of the Seller thereunder,
remedies against past, current and future infringements thereof and rights to
protection therein, in each case exclusively used in the current conduct of the
Business (except for Trademarks which include the Seller’s name, other than
ASML PerfectWave), to the extent transferable; 

          (f)          all
licenses, permits, consents, certificates, franchises or other governmental
authorizations exclusively used in the current conduct of the Business by the
Seller or the current ownership, use or operation of the Owned Real Property or
the Improvements by the Seller,

other than any such
licenses, permits, consents, certificates, franchises or other governmental
franchises which cannot be legally transferred;

          (g)          all
books, records, files, printouts, drawings, data, files, notes, notebooks,
accounts, invoices, correspondence, specifications, creative materials,
advertising or promotional materials, marketing materials, studies, reports,
memoranda or papers, software (including past versions thereof to the extent
readily available and transferable) or relevant portion thereof (collectively,
“Records”), in each case in the Seller’s possession and physically located at
the Richmond Facility, whether in hard copy, electronic or other format, and,
in the case of Records in hard copy, physically located at Richmond Facility,
used exclusively in the past or current conduct of the Business by the Seller
or its predecessors, or the ownership, use and operation of the Owned Real
Property and Improvements by the Seller or its predecessors;

          (h)          all
goodwill associated with the Acquired Assets; and

          (i)          any
supplies ordered by the Seller for use exclusively in the Business at the
Richmond Facility, but not yet received as of the Closing Date.

          TO
HAVE AND TO HOLD, all and singular, the same unto the Purchaser, its successors
and assigns, to its own use forever.

          The
Seller covenants that it shall, from time to time, make, execute and deliver,
or cause to be made, executed and delivered, such assignments, deeds, bills of
sale, drafts, checks and other instruments, acts, consents and assurances as
the Purchaser or counsel for the Purchaser may reasonably request for the
effectual consummation, confirmation and particularization of this Bill of Sale
and Assignment.

          The
Seller further covenants and agrees that the covenants herein contained shall
be binding upon its successors and assigns and shall inure to the benefit of
the successors and assigns of the Purchaser.

          This
Bill of Sale and Assignment does not replace, substitute for, expand,
extinguish, impair or limit in any way the rights, obligations, claims, or
remedies of any party under the terms and conditions of the Asset Purchase
Agreement. In the event of a conflict between the terms and conditions set
forth in this Bill of Sale and Assignment and the terms and conditions set
forth in the Asset Purchase Agreement, or the interpretation and application
thereof, the terms and conditions set forth in the Asset Purchase Agreement
shall prevail, govern, and control in all respects.

2

                    IN
WITNESS WHEREOF, the Seller has executed this Bill of Sale and Assignment on
this ___ day of _______, 2010.

	
  

 	
  

 	
  

 
	
  

 	
 ASML US, INC.

 
	
  

 	
  

 	
  

 
	
  

 	
 By:

 	
  

 
	
  

 	
  

 	 

 
	
  

 	
  

 	
 Name:

 
	
  

 	
  

 	
 Title:

 

3

EXECUTION
FORM

EXHIBIT
E

ASSUMPTION
AGREEMENT

          This
Assumption Agreement, made and entered into this ____ day of ___________, 2010,
by and between Zygo Richmond Corporation, a Delaware corporation (the
“Purchaser”), and ASML US, Inc., a Delaware corporation (the “Seller”), is
executed and delivered pursuant to, and in furtherance of, the Asset Purchase
Agreement (the “Asset Purchase Agreement”), made as of October __, 2010, by and
among the Purchaser, Zygo Corporation, a Delaware corporation, and the Seller.
Capitalized terms used and not otherwise defined herein shall have the meanings
given to such terms in the Asset Purchase Agreement.  

          WHEREAS,
pursuant to the Asset Purchase Agreement, the Seller has agreed to sell and
transfer to the Purchaser the Acquired Assets; and

          WHEREAS,
in connection with such sale and transfer of the Acquired Assets, the Asset
Purchase Agreement requires the Purchaser to assume the Assumed Liabilities.

          NOW,
THEREFORE, pursuant to the terms of the Asset Purchase Agreement and for good
and valuable consideration, the receipt and adequacy of which are hereby acknowledged,
the Purchaser and the Seller hereby agree as follows:

          1.          The
Purchaser hereby assumes and agrees to otherwise discharge the Assumed
Liabilities.

          2.          Notwithstanding
anything in this Assumption Agreement to the contrary, the parties to this
Assumption Agreement expressly understand and agree that the Purchaser shall
not assume or become liable for any obligations, liabilities or indebtedness of
the Seller other than as set forth in paragraph 1 hereof.

          3.          This
Assumption Agreement shall be binding upon and shall inure to the benefit of
the parties hereto and their respective successors and assigns as permitted
under the Asset Purchase Agreement.

          4.          This
Assumption Agreement is to be governed by and interpreted under the laws of the
State of Delaware, without giving effect to the principles of conflicts of laws
thereof.

          5.          This
Assumption Agreement does not replace, substitute for, expand, extinguish, impair
or limit in any way the rights, obligations, claims, or remedies of any party
to the Asset Purchase Agreement under the terms and conditions of such Asset
Purchase Agreement. In the event of a conflict between the terms and conditions
set forth in this Assumption Agreement and the terms and conditions set forth
in the Asset Purchase Agreement, or the interpretation and application thereof,
the terms and conditions set forth in the Asset Purchase Agreement shall
prevail, govern, and control in all respects.

          6.          This
Assumption Agreement may be executed by the parties hereto in separate
counterparts, each of which when so executed and delivered shall be an
original, but all such counterparts shall together constitute but one and the
same instrument.

EXECUTION
FORM

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

	
  

 	
  

 	
  

 
	
  

 	
 ZYGO RICHMOND CORPORATION

 
	
  

 	
  

 	
  

 
	
  

 	
 By:

 	
  

 
	
  

 	
  

 	 

 
	
  

 	
  

 	
 Name:

 
	
  

 	
  

 	
 Title:

 
	
  

 	
  

 	
  

 
	
  

 	
 ASML US, INC.

 
	
  

 	
  

 	
  

 
	
  

 	
 By:

 	
  

 
	
  

 	
  

 	 

 
	
  

 	
  

 	
 Name:

 
	
  

 	
  

 	
 Title:

 

EXECUTION FORM

EXHIBIT F

FIRPTA CERTIFICATION

          Section
1445 of the Internal Revenue Code of 1986, as amended (the “Code”),
provides that a transferee (buyer) of a U.S. real property interest must
withhold tax if the transferor (seller) is a foreign person. For U.S. tax
purposes (including section 1445 of the Code), the owner of a disregarded
entity (which has legal title to a U.S. real property interest under local law)
will be the transferor of the property and not the disregarded entity. ASML US, INC., a Delaware corporation (“Transferor”),
is the “Seller” under that certain Asset Purchase Agreement dated as of October
__, 2010 (the “Asset Purchase Agreement”), by and among between ZYGO RICHMOND CORPORATION, a Delaware
corporation (“Transferee”), ZYGO
CORPORATION, a Delaware corporation, and Transferor.

          To
inform Transferee that withholding of tax is not required upon the disposition
to Transferee of a U.S. real property interest by Transferor, the undersigned
hereby certifies the following pursuant to Treas. Reg. § 1.1445-2(b) on behalf
of Transferor:

	
  

 	
  

 	
  

 
	
  

 	
 1.

 	
 Transferor
 is not a foreign corporation, foreign partnership, foreign trust, or foreign
 estate, as those terms are defined in the Code and Income Tax Regulations.

 
	
  

 	
  

 	
  

 
	
  

 	
 2.

 	
 Transferor
 is not a disregarded entity as defined in §1.1445-2(b)(2)(iii) of the Income
 Tax Regulations.

 
	
  

 	
  

 	
  

 
	
  

 	
 3.

 	
 Transferor’s
 U.S. employer identification number is: 77-0568140; and

 
	
  

 	
  

 	
  

 
	
  

 	
 4.

 	
 Transferor’s
 office address is: 

 

	
  

 	
  

 
	
  

 	
 ASML US, Inc.

 
	
  

 	
 8555 S. River Parkway

 
	
  

 	
 Tempe, AZ 85284

 

          Transferor
understands that this certification may be disclosed to the Internal Revenue
Service by Transferee and that any false statement contained herein could be
punished by fine, imprisonment, or both.

          Under
penalties of perjury, I declare that I have examined this certification and to
the best of my knowledge and belief it is true, correct, and complete, and I
further declare that I have authority to sign this certification on behalf of
Transferor.

	
  

 	
  

 	
  

 	
  

 
	
  

 	
 ASML US,
 INC.

 	
  

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 By:

 	
  

 	
  

 
	
  

 	
 Name:

 	
  

 
	
  

 	
 Title:

 	
  

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 Dated:  __________,
 2010

 	
  

 

EXHIBIT G

MATTERS TO BE COVERED BY OPINION OF SELLER’S
COUNSEL

[Actual opinion will contain customary
exclusions and qualifications. Capitalized terms used but

not defined herein shall have the definition ascribed to such term in the
Agreement.]

1.          The
Seller is a corporation duly organized, validly existing and in good standing
under the laws of its jurisdiction of organization. Seller has all requisite
corporate power to own, lease and operate the Acquired Assets owned, leased or
operated by it and, to carry on the Business as now being conducted. The Seller
is duly qualified or licensed to do business and is in good standing in the
State of California.

2.          The
Seller has all requisite corporate power and authority to enter into the
Operative Agreements, to perform its obligations thereunder, and to consummate
the Contemplated Transactions. The execution and delivery of the Operative
Agreements, and the consummation of the Contemplated Transactions, have been
duly authorized by all necessary corporate action on the part of the Seller. No
vote of the holders of the shares of capital stock of the Seller is required to
approve Seller’s execution of the Operative Agreements and the consummation of
the Contemplated Transactions by the Seller. The Agreement has been duly
executed and delivered by the Seller and constitutes the valid and binding
obligation of the Seller enforceable against the Seller in accordance with its
terms. The execution and delivery of the Agreement by the Seller and the
consummation of the Contemplated Transactions does not constitute a violation
of or a default under (i) any provision of the certificate of incorporation or
bylaws of the Seller or (ii) any Assumed Contract.

EXECUTION FORM

EXHIBIT H

TRADEMARK ASSIGNMENT AGREEMENT

          This
Assignment is made effective as of the date of signature hereto (the “Effective
Date”) by ASML Holding NV, a company organized under the laws of the Netherlands
with principal offices at De Run 6501, 5504 DR Veldoven, The Netherlands
(“Assignor”) in favor of Zygo Richmond Corporation, a Delaware corporation with
principal offices c/o Zygo Corporation, Laurel Brook Road, Middlefield,
Connecticut (“Assignee”).

          WHEREAS,
the Assignor and the Assignee are parties to that certain Asset Purchase
Agreement, dated as of _____________, 2010 (the “Purchase Agreement”), pursuant to which the Assignee has agreed
to acquire the Assignor’s right, title and interest in and to the registered
and common law trademarks set forth in Schedule A (the “Trademarks”).

          NOW,
THEREFORE, for good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, 

          Assignor
hereby assigns, conveys and transfers unto Assignee, its successors, assigns
and legal representatives, the entire right, title and interest in the
Trademarks, including domestic and foreign rights, including without
limitation: (i) all goodwill associated therewith; (ii) any and all
applications, registrations or certificates or renewals that may be issued or
granted therefor; (iii) all income, royalties, damages and payments now or
hereafter due or payable in respect thereto; (iv) all causes of action, either
in law or in equity, for damages for past, present or future infringement
thereof throughout the entire world; and (v) the right throughout the world to
file applications and/or renewals and obtain registrations in Assignee’s own
name throughout the world, including, without limitation, all rights of
priority.

          Assignor
represents and warrants to Assignee that it has the full right, power and
authority to enter into this Assignment and grant the rights granted in this
Assignment. Assignor further agrees to execute any and all powers of attorney,
applications, assignments, declarations, affidavits, and any other agreements,
documents or instruments in connection therewith necessary or appropriate to
perfect such rights, title and interest assigned hereby in Assignee, its
successors, assigns and legal representatives. 

          Assignor
hereby agrees to communicate to Assignee, and its successors, assigns and legal
representatives, any facts known to Assignor respecting the Trademark; and, at
the expense of Assignee, to testify in any legal proceedings, sign all lawful
agreements, documents or instruments, make all lawful oaths and generally do
everything possible to vest title in Assignee and to aid Assignee, its
successors, assigns and legal representatives to obtain and enforce its rights
under the Trademark.

IN WITNESS
WHEREOF, Assignor has executed this Assignment to be effective as of the
Effective Date.

ASML Holding
NV 

a company organized under the laws of the Netherlands

	
  

 	
  

 	
  

 
	
 By:

 	
  

 	
  

 
	
 Name:

 	
  

 	
  

 
	
 Title:

 	
  

 	
  

 
	
 Date:

 	
  

 	
  

 

- 2 -

SCHEDULE A
REGISTRATIONS, APPLICATIONS, AND COMMON LAW MARKS

Registered Trademarks

1.          ASML
PerfectWave

	
  

 	
  

 	
  

 	
  

 	
  

 
	
 Registration

 Number

 	
 Date Registered

 	
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1.          PerfectWave

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- 3 -exh10-1feldman.htm

Exhibit 10.1

 

EMPLOYMENT AGREEMENT

AGREEMENT, dated as of January 1, 2011, between GSE Systems, Inc. a Delaware corporation with principal executive offices at 1332 Londontown Blvd., Sykesville, MD  21784 (the "Company"), and Jerome I. Feldman, residing at 145 West Patent Road, Bedford Hills, NY  10507 ("Employee").

 

WITNESSETH

WHEREAS, the Employee currently serves as Executive Chairman of the Board of the Company.

WHEREAS, the Company desires to employ Employee upon the terms and subject to the terms and conditions set forth in this Agreement.

NOW, THEREFORE, in consideration of the premises, the mutual promises, covenants, and conditions herein contained and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto intending to be legally bound hereby agree as follows:

Section 1.                                             Employment.

The Company hereby agrees to continue to employ Employee, and Employee hereby agrees to continue to serve the Company, all upon the terms and subject to the conditions set forth in this Agreement.

Section 2.                                            Capacity and Duties.

Employee shall be employed in the capacity of Executive Chairman of the Board of the Company and shall have the duties, responsibilities, and authorities normally performed by the Executive Chairman of the Board of a company and such other duties, responsibilities, and authorities as are assigned to him by the Board of Directors of the Company (the "Board") so long as such additional duties, responsibilities, and authorities are consistent with Employee's position and level of authority as Executive Chairman of the Board of the Company.  Employee shall devote substantially all of his business time and attention to promote and advance the business of the Company, except that, subject to the provisions of Sections 6 and 8, Employee shall be permitted to engage in outside activities so long as they do not unreasonably interfere with Employee’s obligations hereunder.

Section 3.                                            Term of Employment.

Unless sooner terminated in accordance with the provisions of this Agreement, the term of employment of Employee by the Company pursuant to this Agreement shall be for the period (the "Employment Period") commencing on  January 1, 2011 and ending on December 31, 2012 (the “Scheduled Termination Date”).

  

  

  

Section 4.                                            Compensation.

During the Employment Period, subject to all the terms and conditions of this Agreement and as compensation for all services to be rendered by Employee under this Agreement, the Company shall pay to or provide Employee with the following:

(a) Base Salary.  Commencing January 1, 2011, the Company shall pay to Employee a base annual salary at the rate of Three Hundred Thousand Dollars ($300,000.00).  On  January 1, 2012, the base annual salary shall be increased, as determined by the Board of Directors of the Company by a minimum of the greater of (i) 3% or (ii) the percentage increase in the Consumer Price Index (as hereinafter defined) over the preceding twelve months.  The "Consumer Price Index" shall mean the Consumer Price Index for all Urban Consumers published by the Bureau of Labor Statistics, United States Department of Labor, or the supplement or successor thereto if publication of such index should be discontinued.  The base salary will be payable at such intervals as salaries are paid generally to other executive officers of the Company.

(b) Bonus.  Once the Company's year end financial information is available the Chief Executive Officer and the Board of Directors of the Company shall determine Employee's bonus (the "Bonus") for the year then ending based upon (i) meeting the goals set by Employee and accepted by the Chief Executive Officer and the Board of Directors and (ii) overall Company performance.  The Employee's target bonus is One Hundred Fifty Thousand Dollars ($150,000.00) for 2011, and Employee's target bonus shall increase each succeeding year by the greater of (i) 3% or (ii) the percentage increase in the Consumer Price Index over the preceding twelve months.  As soon as reasonably practicable, Employee's goals for 2011 will be prepared and mutually agreed upon.  Any bonus to be paid to Employee for any year of this Agreement shall be paid on or prior to March 15 of the following year.

(c) Vacation.  Employee shall be entitled to vacation in accordance with the Company's policy for its senior executives.

(d) Automobile.  The Company shall provide Employee with an automobile allowance of Seven Thousand Two Hundred Dollars ($7,200.00) per year, and shall pay the maintenance, gas, and insurance expenses in connection with such automobile.

(e) Club Membership. The Company shall provide Employee an allowance for club membership of Four Thousand Dollars ($4,000.00) per year.

(f) Medical and Dental Insurance.  The Company shall pay Employee’s monthly Medical and Dental Insurance premiums in association with Company provided health insurance plans.

(g) Benefit Plans.  Employee shall be entitled to participate in all employee benefit plans maintained by the Company for its senior executives or employees, including without limitation the Company's medical and 401(k) plans.

Section 5.                                             Expenses.

  

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The Company shall reimburse Employee for all reasonable expenses (including, but not limited to, continuing education, business travel, and customer entertainment expenses) incurred by him in connection with his employment hereunder in accordance with the written policy and guidelines established by the Company for executive officers.

Section 6.                                            Non-Competition, Non-Solicitation.

Employee agrees that during the period he is employed by the Company under this Agreement and for a period of one (1) year after the termination of his employment he will not directly or indirectly, (a) solicit or offer employment to any person who was employed by the Company or any of its subsidiaries while Employee was employed by the Company (b) solicit, offer or induce in competition with the Company, any person, entity or governmental authority that was under contract with the Company or with whom the Company or any of its subsidiaries was actively soliciting business from while Employee was employed by the Company, or (c) become engaged in a business that is directly competitive with the business of the Company or any of its subsidiaries.

Section 7.                                            Patents.

Any interest in patents, patent applications, inventions, copyrights, developments, and processes ("Such Inventions") which Employee now or hereafter during the period he is employed by the Company under this Agreement or otherwise may own or develop relating to the fields in which the Company or any of its subsidiaries may then be engaged shall belong to the Company; and forthwith upon request of the Company, Employee shall execute all such assignments and other documents and take all such other action as the Company may reasonably request in order to vest in the Company all his right, title, and interest in and to Such Inventions free and clear of all liens, charges, and encumbrances.

Section 8.                                            Confidential Information.

All confidential information which Employee may now possess, may obtain during the Employment Period, or may create prior to the end of the period he is employed by the Company under this Agreement or otherwise relating to the business of the Company or of any of its customers or suppliers shall not be published, disclosed, or made accessible by him to any other person, firm, or corporation either during or after the termination of his employment or used by him except during the Employment Period in the business and for the benefit of the Company, in each case without prior written permission of the Company. Employee shall return all tangible evidence of such confidential information to the Company prior to or at the termination of his employment For purposes of this Agreement, “confidential information” means any and all information related to the Company or any of its subsidiaries that is not generally known by others with whom they compete or do business.

Section 9.                                            Termination.

  

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Except as provided in Section 13, Employee's employment hereunder may be terminated without any breach of this Agreement only under the following circumstances:

(a)        Death.  Employee's employment hereunder shall terminate upon his death.

(b)        Disability.  If, as a result of Employee's incapacity due to physical or mental illness, Employee shall have been absent from his duties hereunder on a full-time basis for the entire period of three (3) consecutive months, and within 30 days after a Notice of Termination (as defined in Section 9(d)) is given shall not have returned to the performance of his duties hereunder on a full-time basis, the Company may terminate Employee's employment hereunder.

(c)        Cause.  The Company may terminate Employee's employment hereunder for Cause. For purposes of this Agreement, the Company shall have "Cause" to terminate  Employee's employment hereunder upon the occurrence of any of the following (i) the willful and continued failure by Employee to substantially perform his duties or obligations hereunder (other than any such failure resulting from Employee's incapacity due to physical or mental illness), after demand for substantial performance is delivered by the Company that specifically identifies the manner in which the Company believes Employee has not substantially performed his duties or obligations, (ii) the willful engaging by Employee in misconduct which, in the reasonable opinion of the Board of the Company, will have a material adverse effect on the reputation, operations, prospects or business relations of the Company, (iii) the conviction of Employee of any felony or the entry by Employee of any plea of nolo contendere in response to an indictment for a crime involving moral turpitude, or (iv) the breach by Employee of a term or condition of this Agreement.  For purposes of this paragraph, no act, or failure to act, on Employee's part shall be considered "willful" unless done, or omitted to be done, by him not in good faith and without reasonable belief that his action or omission was in the best interest of the Company. Notwithstanding the foregoing, Employee shall not be deemed to have been terminated for Cause without the following (i) reasonable notice to Employee setting forth the reasons for the Company's intention to terminate for Cause, (ii) an opportunity for Employee, together with his counsel, to be heard before the Board, and (iii) delivery to Employee of a Notice of Termination in accordance with Section 9(d).

(d)        Notice of Termination.  Any termination of Employee's employment by the Company (other than termination pursuant to Section 9(a)) shall be communicated by a Notice of Termination to the other party hereto. For purposes of this Agreement, a "Notice of Termination" shall mean a written notice which shall indicate the specific termination provision in this Agreement relied upon and shall set forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of Employee's employment under the provision so indicated.

(e)        Date of Termination.  "Date of Termination" shall mean (i) if Employee's employment is terminated by his death, the date of his death, (ii) if Employee's employment is terminated pursuant to Section 9(b), 30 days after Notice of Termination is given (provided that Employee shall not have returned to the performance of his duties on a full-time basis during such 30 day period), and (iii) if Employee's employment is terminated for any other reason, the date specified in the Notice of Termination, which shall not be earlier than the date on which the Notice of Termination is given.

  

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Section 10.                                       Compensation upon Termination or During Disability.

(a)        During any period that Employee fails to perform his duties hereunder as a result of incapacity due to physical or mental illness ("disability period"), Employee shall continue to receive his full salary at the rate then in effect for such period until his employment is terminated pursuant to Section 9(b), provided that payments so made to Employee during the disability period shall be reduced by the sum of the amounts, if any, payable to Employee at or prior to the time of any such payment under disability benefit plans of the Company and which were not previously applied to reduce any such payment.

(b)        If Employee's employment shall be terminated for Cause, the Company shall pay Employee his full salary through the Date of Termination at the rate in effect at the time Notice of Termination is given.

(c)        If the Company shall terminate Employee's employment in breach of the terms of this Agreement, then the Company shall pay Employee his full salary and provide Employee his benefits for a period equal to the greater of (i) the number of months then remaining on the term of this Agreement and (ii) 12 months. All options to purchase the Company's common stock granted to Employee under the Company's option plan or otherwise shall immediately become fully vested and shall terminate on such date as they would have terminated if Employee's employment by the Company had not been terminated.

   (d)        If Employee’s employment is terminated at the Scheduled Termination Date of this Agreement or if Employee continues as an employee after the Scheduled Termination Date and Employee’s employment is subsequently terminated by the Company for a reason other than (i) the death or disability of the Employee or (ii) cause, Employee shall be entitled to receive his full salary and benefits for a period of one year from the date of termination.

Section 11.                                       Accelerated Vesting of Options Upon Change of Control.

After the date of this Agreement, in the event of a Change of Control (as defined below) of the Company, the options granted to Employee under the Company's option plan or otherwise shall become fully vested immediately prior to the date such Change of Control shall be deemed to have occurred and any conditions to the Employee’s entitlement to such options under the Company’s option plan or otherwise shall be deemed to have satisfied.

For purposes of this Agreement, a “Change in Control” of the Company shall be deemed to have occurred as of the first day that any one or more of the following conditions shall have been satisfied:

   (a)        Any person (other than a person in control of the Company as of the date of this Agreement, or other than a trustee or other fiduciary holding securities under an employee benefit plan of the Company, or a company owned directly or indirectly by the stockholders of the Company in substantially the same proportions as their ownership of voting securities of the Company) becomes the beneficial owner, directly or indirectly, of securities of the Company representing a majority of the combined voting power of the Company’s then outstanding securities; or

  

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   (b)        The stockholders of the Company approve: (x) a plan of complete liquidation of the Company (which includes a termination and liquidation of all Employee’s rights under any arrangement governed by Section 409A of the Internal Revenue Code of 1986, as amended (“Code”); or (y) an agreement for the sale or disposition of all or substantially all the Company’s assets; or (z) a merger, consolidation, or reorganization of the Company with or involving any other corporation, other than a merger, consolidation, or reorganization that would result in the voting securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity) at least a majority of the combined voting power of the voting securities of the Company (or such surviving entity) outstanding immediately after such merger, consolidation, or reorganization.

For purposes of this definition of Change in Control, “Person” shall have the meaning ascribed to such term in Section 3(a)(9) of the Securities Act of 1934, as amended (the “1934 Act”), and used in Section 13(d) and 14(d) thereof, including a “group” as defined in Section 13(d) thereof, and “Beneficial Owner” shall have the meaning ascribed to such term in Rule 13d-3 of the General Rules and regulations under the 1934 Act.

Section 12.                                       Successors; Binding Agreement.

The Company will require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or assets of the Company, by agreement in form and substance reasonably satisfactory to Employee, to expressly assume and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform it if no such succession had taken place.

Section 13.                                       Severance upon Change of Control.

In the event of a Change of Control, Employee may terminate this Agreement for Good Reason (as defined herein).  Upon termination for Good Reason, Employee shall, for a period of 12 months from the date of his termination, continue to receive salary and all benefits (including medical, dental and life insurance coverage and any other Company-provided benefits, including car and club allowances) that Employee is receiving as of the date (the “Effective Date”) the Change of Control occurs (collectively, “Severance Benefits”).  In addition, the Employee shall also be entitled to receive on the date of termination an amount equal to the average of the Bonus amounts paid to Employee for the two years prior to the year in which the Change of Control takes place.

“Good Reason” shall mean Employee’s good faith determination that any of the following occurs: (a) without Employee prior written consent Employee’s duties, responsibilities or authority become materially inconsistent with those of Employee’s current position; (b) Employee’s annual base salary (as the same may be increased at any time hereafter) and bonus programs are materially reduced; (c) Employee’s benefits (including medical, dental and life insurance coverage and any other Company-provided benefits, including car or club allowances to which Employee is entitled as of the Effective Date) are either discontinued or materially reduced; (d) Employee’s primary office or location is moved more than fifty (50) miles from Employee’s current office or location; or (e) either the Company or any successor company fails to honor all the material terms and provisions of this Agreement.  In the event of Employee’s decision to terminate employment for Good Reason, Employee must give notice to Company of the existence of the conditions giving rising to the termination for Good Reason within ninety (90) days of the initial existence of the conditions.  Upon such notice, Company shall have a period of thirty (30) days during which it may remedy the conditions (“Cure Period”).  If the Company fails the cure the conditions constituting the Good Reason during the Cure Period, Employee’s termination of employment must occur within a period of ninety (90) days following the expiration of the Cure Period in order for the termination to constitute a termination pursuant to Good Reason for purposes of this Agreement.

  

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Section 14.                                       No Third Party Beneficiaries.

This Agreement does not create, and shall not be construed as creating, any rights enforceable by any person not a party to this Agreement (except as provided in Section 12).

Section 15.                                       Fees and Expenses.

The Company shall pay all reasonable legal fees and related expenses (including the costs of experts, evidence, and counsel) incurred by Employee as a result of a contest or dispute over Employee's termination of employment if such contest or dispute is settled or adjudicated on terms that are substantially in favor of Employee. In addition, the Company shall pay Employee interest, at the prevailing prime rate, on any amounts payable to Employee hereunder that are not paid when due.

Section 16.                                       Representations and Warranties of Employee.

Employee represents and warrants to the Company that (a) Employee is under no contractual or other restriction or obligation which is inconsistent with the execution of this Agreement, the performance of his duties hereunder, or the other rights of the Company hereunder and (b) Employee is under no physical or mental disability that would hinder his performance of duties under this Agreement.

Section 17.                                       Life Insurance.

If requested by the Company, Employee shall submit to such physical examinations and otherwise take such actions and execute and deliver such documents as may be reasonably necessary to enable the Company, at its expense and for its own benefit, to obtain life insurance on the life of Employee. Employee has no reason to believe that his life is not insurable with a reputable insurance company at rates now prevailing in the City of Baltimore for healthy men of his age.

Section 18.                                       Modification.

This Agreement sets forth the entire understanding of the parties with respect to the subject matter hereof, supersede all existing agreements between them concerning such subject matter, and may be modified only by a written instrument duly executed by each party.

  

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Section 19.                                       Notices.

Any notice or other communication required or permitted to be given hereunder shall be in writing and shall be mailed by certified mail, return receipt requested, or delivered against receipt to the party to whom it is to be given at the address of such party set forth in the preamble to this Agreement (or to such other address as the party shall have furnished in writing in accordance with the provisions of this Section 19).

Section 20.                                       Governing Law.

This Agreement shall be governed by and construed in accordance with the laws of the State of Maryland, without giving effect to conflict of laws.

Section 21.                                      409A of the Code

	
  

	
This Agreement is intended to comply with the requirements of Section 409A of the Code or any exemption from Section 409A of the Code, and shall in all respects be administered in accordance with and interpreted to ensure compliance with Section 409A of the Code.  Employee’s termination of employment under this Agreement shall be interpreted in a manner consistent with the separation from service rules under Section 409A of the Code.  For purposes of Section 409A of the Code, each payment made under this Agreement shall be treated as a separate payment and the right to a series of payments under this Agreement shall be treat as a right to a series of separate payments.  In no event shall Employee, directly or indirectly, designate the calendar year of the payment.  Furthermore, if, at the time of termination of employment with the Company, Company has stock which is publicly traded on an established securities market and Employee is a “specified employee” (as defined in Section 409A of the Code) and it is necessary to postpone the commencement of any payments or benefits otherwise payable pursuant to this Agreement as a result of such termination of employment to prevent any accelerated or additional tax under Section 409A of the Code, then Company shall postpone the commencement of the payment of such payment or benefits hereunder (without any reduction in such payments or benefits ultimately paid or provided to Employee) that are not otherwise paid within the short-deferral exception under Section 409A of the Code and are in excess of the lessor of two (2) times (i) Employee’s then annual compensation or (ii) the limit on compensation then set forth in Section 401(a)(17) of the Code, until the first payroll date that occurs after the date that is six months following Employee’s separation from service with the Company (within the meaning of Section 409A of the Code).  The accumulated postponed amount shall be paid in a lump sum payment within ten days after the end of the six month period.

  

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

GSE SYSTEMS, INC.

By: ________________________                                                                _______________________________ 

                                     Jerome I. Feldman

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