Document:

Exhibit
10.2

 

REAL
PROPERTY SALE AND PURCHASE AGREEMENT

 

THIS REAL
PROPERTY SALE AND PURCHASE AGREEMENT (this “Agreement”)
is made and entered into on this 29th day of August, 2007, by and
between SYMMETRY MEDICAL USA INC., a Delaware
corporation (“SYMMETRY”), and MFW INVESTMENTS,
a Tennessee general partnership (“MFW”), under the circumstances set forth
below.

 

W I T N E S S E T H:

 

WHEREAS,
Louis C. Wallace and Charles O. Mann, Jr. (collectively, “Wallace and Mann”),
as sellers, and SYMMETRY, as purchaser, have entered into that certain Purchase
Agreement, dated as of the date hereof, whereby Wallace and Mann have agreed to
sell all of the issued and outstanding shares of capital stock of Specialty
Surgical Instrumentation, Inc., a Tennessee corporation (“SSI”), and all of the
outstanding membership interests of UCA, LLC, a Tennessee limited liability
company (“UCA”), to SYMMETRY (the “Purchase Agreement”);

 

WHEREAS,
Wallace and Mann also own all of the partnership interests of MFW;

 

WHEREAS,
MFW is the owner of a fee simple interest in the tract of real property,
including, without limitation, all improvements, buildings, structures, signage
and fixtures upon such real property, located at 200 River Hills Drive in
Davidson County, Nashville, Tennessee (the “Real Property”);

 

WHEREAS,
MFW is the holder of a leasehold interest as landlord in the Lease Agreement
dated May 1, 1992 and the First Amendment to Lease Agreement dated August 31,
2006, under which SSI is the tenant, covering the Real Property (collectively,
the “Lease”);

 

WHEREAS,
in connection with the terms of the Purchase Agreement, Wallace and Mann have
negotiated with SYMMETRY for the sale and purchase of the interests of MFW in
the Real Property and the Lease; and

 

WHEREAS,
SYMMETRY desires to purchase from MFW the interests of MFW in the Real Property
and the Lease upon the terms and conditions hereinafter set forth.

 

NOW,
THEREFORE, in consideration of the mutual covenants
and agreements contained in this Agreement and other good and valuable consideration
more fully set forth below, the receipt and sufficiency of which is hereby
acknowledged, MFW and SYMMETRY hereby agree as follows:

 

1.                                    Subject Property.  

 

On the terms and subject to the conditions
set forth in this Agreement, and in consideration of payment of the Purchase
Price by SYMMETRY to MFW, MFW hereby agrees to sell, assign, transfer and
convey to SYMMETRY, and SYMMETRY hereby agrees to purchase and acquire from
MFW, at the Closing (as hereinafter defined), the following (collectively, the “Subject
Property”):

 

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(i)                                     all of MFW’s
ownership interest in the Real Property listed by address and legally described
in Schedule 1 attached hereto and made a part hereof by reference;

 

(ii)                                  all of MFW’s
leasehold interest as landlord in the Lease;

 

(iii)                               all of MFW’s existing
easements, options, licenses, rights, tenements and privileges appurtenant or
pertaining to the Real Property;

 

(iv)                              all equipment,
furnishings, materials, inventory, supplies and other tangible personal
property, if any, owned by MFW placed or installed on the Real Property and
used in respect thereto (collectively, the “Tangible Personal Property”),
except for those items specifically excluded from the sale as set forth on Schedule
2 attached hereto and made a part hereof by reference; and

 

(v)                                 any transferable
development rights, permits, certificates of occupancy, entitlements,
franchises and other intangible property pertaining to or inuring to the
benefit of MFW or the Real Property, including, without limitation, all
consents, authorizations, variances or waivers, licenses, warranties, permits
and approvals from any Governmental Authority (as hereinafter defined) in
respect of the Real Property, and all service contracts and service contract
rights to which MFW is a party (the “Project Contracts”) which are Assumed
Contracts (as hereinafter defined) that remain valid and in effect as of the
Closing Date (as hereinafter defined) (collectively, the “Intangibles”).

 

2.                                    Purchase
Price.  

 

The purchase price (the “Purchase Price”) for
the Subject Property shall be One Million Fifty Thousand and No/100 Dollars
($1,050,000.00). At the Closing, SYMMETRY shall pay the Purchase Price less the
adjustments provided for herein (the “Cash Payment”) by wire transfer of
immediately available funds to an account designated by the Title Company (as
hereinafter defined) on or prior to the Closing Date. No portion of the
Purchase Price is being allocated to the Tangible Personal Property, and MFW and
SYMMETRY hereby assign a value of Zero and No/100 Dollar ($0.00) to the
Tangible Personal Property.

 

3.                                    Title
Insurance.  

 

SYMMETRY has already ordered from a
nationally recognized title insurance company (the “Title Company”)
satisfactory to both SYMMETRY and MFW an irrevocable commitment (the “Title
Commitment”) to issue a fee owner’s title insurance policy (American Land Title
Association “ALTA” owner’s policy form 1992) to SYMMETRY, and a mortgagee’s
title insurance policy to any lender designated by SYMMETRY, with respect to
the Real Property, in form and substance satisfactory to SYMMETRY and SYMMETRY’s
lender, together with endorsements reasonably requested by SYMMETRY, including,
without limitation, access, zoning (ALTA Form 3.1 with parking), comprehensive
and survey endorsements, each in an amount determined by SYMMETRY and
consistent with the Purchase Price, insuring SYMMETRY and SYMMETRY’s lender
and, as a condition to SYMMETRY closing, issued as of the Closing Date by the
Title Company, showing MFW can convey to SYMMETRY a good, marketable and fee
simple title to the Real Property, subject only to the Allowable 

 

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Encumbrances (as hereinafter defined), with
extended coverage over all general exceptions. MFW agrees to deliver to the
Title Company any affidavits or indemnities reasonably required by the Title
Company in connection with the delivery of the owner’s title insurance policy
and the mortgagee’s title insurance policy issued to SYMMETRY’s lender. MFW
shall bear the cost of the Title Commitment and the fee owner’s title insurance
policy. SYMMETRY, however, shall bear the cost of any endorsements requested by
SYMMETRY or SYMMETRY’s lender and the cost of the mortgagee’s title insurance
policy. SYMMETRY shall be entitled to the benefit of any simultaneous issue
discount.

 

If SYMMETRY does not make a written objection
to any exception to title disclosed in the Title Commitment within ten (10)
days of receipt of both the Title Commitment and the Survey (as hereinafter
defined), the disclosed exception shall be deemed an Allowable Encumbrance. If
SYMMETRY makes an objection to a disclosed exception, MFW shall have until the
Closing Date to cure the same to SYMMETRY’s reasonable satisfaction. MFW agrees
to use commercially reasonable efforts and reasonable diligence to cure any
objections, however, MFW is not required to cure any such objections. In the
event that MFW cannot or is unwilling to cure SYMMETRY’s objections within said
period to SYMMETRY’s satisfaction, SYMMETRY shall have the following
options:  (i) to elect to extend the time
period in which MFW may act to cure such objections; (ii) to waive the
objections and proceed to Closing; or (iii) to terminate this Agreement without
penalty. If SYMMETRY elects option (i), and if, at the end of the extended
period, MFW is still unable or unwilling to cure SYMMETRY’s objection, then
SYMMETRY may elect either option (ii) or (iii).

 

4.                                    Survey.      SYMMETRY,
at MFW’s expense, has already ordered an ALTA/ACSM Survey (the “Survey”) of the
Real Property prepared by a land surveyor licensed under the laws of the State
of Tennessee. The Survey shall: (i) contain an accurate legal description of
the land showing the location of any flood plains and conform to the most
recently adopted minimum standard detail requirements for ALTA/ACSM surveys
(urban classification) (2005), including items 1-4, 6, 7a, 8-11a, 13 and 16-18
of Table A; and (ii) be certified to MFW, SYMMETRY, SYMMETRY’s lender, Barrett
& McNagny LLP and the Title Company.

 

If SYMMETRY does not make a written objection
to any item disclosed in the Survey within ten (10) days of receipt of both the
Title Commitment and the Survey, the disclosed item shall be deemed an
Allowable Encumbrance. If SYMMETRY makes an objection to a disclosed item, MFW
shall have until the Closing Date to cure the same to SYMMETRY’s reasonable
satisfaction. MFW agrees to use commercially reasonable efforts and reasonable
diligence to cure any objections, however, MFW is not required to cure any such
objections. In the event that MFW cannot or is unwilling to cure SYMMETRY’s
objections within said period to SYMMETRY’s satisfaction, SYMMETRY shall have
the following options: (i) to elect to extend the time period in which MFW may
act to cure such objections; (ii) to waive the objections and proceed to
Closing; or (iii) to terminate this Agreement without penalty. If SYMMETRY
elects option (i), and if, at the end of the extended period, MFW still is
unable to cure SYMMETRY’s objection, then SYMMETRY may elect either option (ii)
or (iii).

 

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5.                                      Contingencies.

 

5.1                               SYMMETRY’s
Contingencies.

 

The obligation
of SYMMETRY to perform and close under this Agreement is expressly conditioned
upon the fulfillment by and as of the Closing Date of, among any others stated
herein, each of the conditions listed below:

 

A.            All
 representations and warranties of MFW
set forth herein shall be true and correct in all material respects on and as
of the Closing Date as if made on and as of such date.

 

B.            The
assignment and assumption agreement of the Lease, to be delivered by MFW at
Closing, shall contain, inter alia, a certification from MFW that MFW and to
its knowledge SSI are not in default of the terms and conditions of the Lease
(the “Assignment of Lease”).

 

C.            The
current use of the Real Property not being in violation of the applicable
zoning ordinance.

 

D.            The
Real Property having legal access to and from a public roadway.

 

E.             All
utilities, including water, sanitary sewer, electric and gas, being available
at or able to be extended to the Real Property to the satisfaction of SYMMETRY.

 

F.             Closing occurs
under the Purchase Agreement.

 

If any of the contingencies set forth above
has not been satisfied, this Agreement may be terminated by SYMMETRY without
penalty, or such contingency may be waived by SYMMETRY and the transaction
shall proceed forward. If SYMMETRY elects the latter, SYMMETRY may delay
Closing a reasonable time period to further address the waived contingencies.

 

5.2                               MFW’s
Contingencies.

 

The obligation
of MFW to perform and close under this Agreement is expressly conditioned upon
the fulfillment by and as of the Closing Date of, among any others stated
herein, each of the conditions listed below:

 

A.            All
representations and warranties of SYMMETRY set forth herein shall be true and
correct in all material respects on and as of the Closing Date as if made on
and as of such date.

 

B.            SYMMETRY’s payment
and delivery of the Cash Payment to the Title Company.

 

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C.            SYMMETRY’s
execution and delivery of any and all instruments, documents and other items
required hereunder or reasonably necessary to effectuate the terms of this
Agreement.

 

D.            Closing occurs under
the Purchase Agreement.

 

If any of the contingencies set forth above
has not been satisfied, this Agreement may be terminated by MFW without
penalty, or such contingency may be waived by MFW and the transaction shall
proceed forward. If MFW elects the latter, MFW may delay Closing a reasonable
time period to further address the waived contingencies.

 

6.                                      Real
Property Taxes.

 

With respect to the Real Property, and
subject to Section 15.W hereof, the taxes assessed for the current 2007 calendar
year shall be equitably prorated between MFW and SYMMETRY on a calendar year
basis as of the day immediately prior to the Closing Date on the basis of the
last available tax bills covering the Real Property. All taxes assessed for any
prior calendar year and remaining unpaid shall be paid by MFW. In addition: (i)
taxes which are MFW’s responsibility and not yet due as of Closing, shall be
assumed by SYMMETRY, and MFW shall have no further liability for such taxes;
and (ii) all taxes due and payable on or prior to the Closing Date shall be
paid before Closing or at Closing and charged at Closing to MFW. This Section 6
shall survive the Closing.

 

7.                                      Rent
and Current Operating Expenses.  

 

Rent under the Lease shall be prorated to the
day before the Closing Date. All current operating expenses regarding the Real
Property as of the Closing Date shall be an adjustment made on the Closing Date
and handled pursuant to the terms of the Purchase Agreement.

 

8.                                      Risk
of Loss.

 

If, prior to the Closing, a material portion
of the Real Property is destroyed, or is taken under power of eminent domain
(or any entity having condemnation authority shall take any steps preliminary
thereto), then MFW covenants to promptly deliver to SYMMETRY written notice
thereof and SYMMETRY shall be entitled to terminate this Agreement. In the
event that SYMMETRY does not terminate this Agreement pursuant to the
immediately proceeding sentence, SYMMETRY shall close this transaction on the
Closing Date and at the Purchase Price herein agreed, and MFW shall assign to
SYMMETRY its right in and to any insurance proceeds payable in connection with
the casualty or MFW’s portion of any condemnation award up to the amount of the
Purchase Price. For purposes of the foregoing, a “material portion” of the Real
Property shall mean that portion which, if destroyed, taken or condemned, would
(i) eliminate access to any portion of the remainder to which access is
available as of the date of this Agreement, or (ii) cause any noncompliance
with any applicable law, ordinance, rule or regulation of any federal, State of
Tennessee or local authority or governmental agency having jurisdiction over
the Real Property.

 

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9.                                      Closing.

 

The closing on the sale and purchase of the
Subject Property (the “Closing”) will take place at the offices of Barrett
& McNagny LLP, 215 East Berry Street, Fort Wayne, Indiana 46802, on the
date of Closing set by the terms of the Purchase Agreement (the “Closing Date”).
At the Closing, MFW and SYMMETRY will deliver the agreements, instruments,
payments and certificates as provided in Section 10. As a condition to SYMMETRY’s
obligation to close, the parties shall cause the Closing to be insured by the
Title Company. The Closing fee charged by the Title Company shall be split
between and paid evenly by MFW and SYMMETRY.

 

10.                               Closing
Documents.

 

Subject to performance by SYMMETRY and MFW of
their respective obligations under this Agreement, SYMMETRY and MFW agree to
deliver at the Closing the following:

 

10.1        MFW shall deliver
at the Closing the following:

 

A.            A special warranty deed (the “Deed”),
dated as of the Closing Date, conveying good, marketable and fee simple title
to SYMMETRY with respect to the Real Property, free and clear of any and all
leases, liens, judgments and encumbrances, other than the following items (the “Allowable
Encumbrances”):

 

(a).                               Building and zoning
laws, ordinances, State of Tennessee and federal statutes and regulations;

 

(b).                              Utility and drainage
easements of record which do not unreasonably interfere with the present use of
the Real Property;

 

(c).                               Real Property taxes to
be assumed and paid by SYMMETRY pursuant hereto;

 

(d).                              Easements, restrictions,
conditions, covenants and reservations of record which are not objected to by
SYMMETRY in accordance with Section 3 hereof;

 

(e).                               Survey matters which are
not objected to by SYMMETRY in accordance with Section 4 hereof;

 

(f).                                 All title and survey
objections waived, or deemed waived hereunder, by SYMMETRY; and

 

(g).                              the Lease.

 

B.            Two (2) executed counterparts of the
Assignment of Lease;

 

C.            MFW’s share of the closing costs
allocated in accordance with usual custom and practice, except only as
otherwise expressly allocated in this Agreement;

 

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D.            A warranty bill of sale transferring
the Tangible Personal Property to SYMMETRY;

 

E.             An assignment of MFW’s right, title
and interest in the Intangibles (other than the Assumed Contracts) to the
extent that such Intangibles are assignable by MFW;

 

F.             Counterparts of a closing statement
(the “Closing Statement”) summarizing all adjustments in respect of the
Purchase Price made at the Closing;

 

G.            An assignment and assumption of all
Project Contracts which SYMMETRY elects, by written notice to MFW given prior
to the Closing Date, to assume (the “Assumed Contracts”);

 

H.            A personal “GAP” undertaking of MFW
in a form acceptable to the Title Company;

 

I.              Exclusive and undisturbed
possession of the Subject Property, subject to the Allowable Encumbrances;

 

J.             An affidavit by MFW indicating that
as of the Closing Date there are no outstanding unsatisfied judgments docketed
or tax liens filed in the official records in and for Davidson County,
Tennessee, or bankruptcies against or involving MFW; that MFW has disclosed and
identified, to the best of its knowledge, all leases, maintenance agreements or
other agreements in force as to the Subject Property; and that MFW knows of no
unrecorded interests in the Subject Property of any kind, together with
whatever standard owner’s affidavit reasonably may be reasonably required by
the Title Company;

 

K.            All other documents effecting title
to and possession of the Subject Property that may be necessary to transfer or
assign the same to SYMMETRY free and clear of all leases, liens, charges and
encumbrances, other than the Allowable Encumbrances;

 

L.             The partners’ certificate required
by Section 15;

 

M.           A memorandum of the Lease for
recording purposes;

 

N.            A certification establishing that no
federal income tax is required to be withheld under the Foreign Investment and
Real Property Tax Act, or to consent to withholding of tax from the proceeds of
sale if required;

 

O.            An amendment to the Lease stating
the tenant’s proportionate share of expenses under the Lease is 100%;

 

P.             Releases and terminations of all
mortgages, financing statements, liens and other related encumbrances as
disclosed in the Title Commitment or a signed

 

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pay-off letter
in a form reasonably acceptable to SYMMETRY and the Title Company; and

 

Q.            Originals or copies of all documents
referenced in Section 1(iii) and (v) to the extent in the possession of MFW.

 

10.2                        SYMMETRY
shall deliver at the Closing the following:

 

A.                                   SYMMETRY’s
share of the closing costs allocated in accordance with usual custom and
practice, except only as otherwise expressly allocated in this Agreement;

 

B.            Two (2) executed counterparts of the
Assignment of Lease;

 

C.            Two (2) executed counterparts of an
assignment and assumption of all Assumed Contracts;

 

D.            Counterparts of the Closing
Statement;

 

E.             The Cash Payment of the Purchase
Price; and

 

F.             The secretary’s
certificate required by Section 16.

 

11.                               Broker
Fees.

 

Neither SYMMETRY nor MFW shall be responsible
for payment of any broker fees or commissions in connection with this
transaction, except to the extent it has retained a broker to represent it in
this transaction, and each party hereby represents and warrants to the other
that it has not retained any such broker.

 

12.                               Closing
Costs.

 

In addition to such other costs herein
specifically referred to, the costs and expenses of the transaction
contemplated hereby shall be payable as follows:

 

A.            All expenses pertaining to any
financing obtained by SYMMETRY shall be payable by SYMMETRY;

 

B.            All recording fees relating to the
Deed and memorandum of the Lease shall be payable by SYMMETRY;

 

C.            All transfer taxes, documentary
taxes, deed stamps or similar taxes or fees due in connection with the
conveyance of the Real Property to SYMMETRY, not to exceed $6,000.00 in the
aggregate, shall be payable by SYMMETRY (any such taxes or fees due in excess
of $6,000.00 shall be payable by MFW);

 

D.            MFW and SYMMETRY shall be
responsible for their respective attorneys’ fees; and

 

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E.             Any other costs of
Closing shall be paid in accordance with what is customary in Davidson County,
Tennessee.

 

13.                               No
Partnership or Joint Venture Created.  

 

Nothing in this Agreement shall be
interpreted as creating a partnership or joint venture between SYMMETRY and MFW
relative to the Subject Property.

 

14.                               Due
Diligence.

 

During the forty-five (45) day period
commencing on the date of execution of this Agreement (the “Due Diligence
Period”), MFW shall allow SYMMETRY, and SYMMETRY’s agents, access to the
Subject Property without charge and at all reasonable times for the purpose of
SYMMETRY’s investigation of and non-invasive testing the same, upon the
condition that MFW receives written notice thereof at least three (3) business
days in advance, which written notice identifies the nature and the scope of
the investigation and testing, the identity of the party or parties who or
which will be conducting the same, and the purpose or purposes therefor. MFW shall
have the right, without limitation, to disapprove any and all entries, surveys,
tests, investigations and the like that in its reasonable judgment could result
in any injury to the Subject Property or breach of any agreement to which MFW
or SSI is a party, or expose MFW to any liability, costs, liens or violations
of applicable law, or otherwise adversely affect the Subject Property or MFW’s
interest therein. No consent by MFW of any such activity shall be deemed to
constitute a waiver by MFW or assumption of liability or risk by MFW. SYMMETRY
shall not permit any mechanic’s or materialmen’s liens or any other liens to
attach to the Subject Property by reason of the performance of any work or the
purchase of any materials by SYMMETRY or any other party in connection with any
studies or tests conducted by or for SYMMETRY. SYMMETRY shall take all
reasonable actions and implement all reasonable protections necessary to ensure
that all actions taken in connection with the investigations and inspections of
the Subject Property, and all equipment, materials and substances generated,
used or brought onto the Subject Property pose no material threat to the safety
of persons or the environment and cause no damage to the Subject Property or
other property of MFW or other persons. SYMMETRY shall pay all costs and
expenses of such investigations and testing, including a phase one
environmental site assessment. SYMMETRY shall deliver to MFW copies of all
investigation and test reports, results, and data, and SYMMETRY shall
immediately and forthwith repair all damages to the Subject Property caused by
or occurring during SYMMETRY’s investigation and testing and restore and return
the Subject Property to substantially the same condition as existed prior to
such entry, at SYMMETRY’s cost and expense, unless SYMMETRY closes on the
purchase of the Subject Property. SYMMETRY shall waive all claims, indemnify,
defend (with attorneys reasonably satisfactory to MFW), and hold harmless MFW,
SSI and their respective agents, employees, directors, representatives,
shareholders, partners and affiliated entities from and against any actions,
omissions or negligence by SYMMETRY and its agents and representatives. SYMMETRY
shall waive all claims, indemnify, defend (with attorneys reasonably
satisfactory to MFW), and hold harmless MFW and SSI from any and all claims,
damages, costs (including, but not limited to attorney and expert fees) and
liability arising out of or due to bodily injury, disease, death, property
damage or SYMMETRY’s and its agents’ entries, surveys, tests, investigations,
and the like. This clause is not intended to indemnify MFW or SSI for claims
caused solely by its own negligence.

 

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SYMMETRY shall have the right, in its sole
and absolute discretion, to elect to terminate this Agreement without penalty
by giving written notice for any reason relating to the condition of the Real
Property of such election to MFW at any time prior to the expiration of the Due
Diligence Period. If SYMMETRY shall timely elect to so terminate this
Agreement, this Agreement shall be terminated and neither party shall have any
further rights, liabilities or obligations hereunder, except as otherwise
expressly provided herein. The indemnity provisions of this Section 14 shall
survive the Closing and termination of this Contract.

 

15.                               Representations
and Warranties of MFW.

 

In addition to any other representations and
warranties made herein, MFW hereby represents and warrants to SYMMETRY as of
the date hereof and agrees to confirm in a partners’ certificate to be
delivered at the Closing that:

 

A.            MFW is a duly authorized and validly
existing general partnership organized under the laws of the State of
Tennessee;

 

B.            MFW has full power and authority to
enter into this Agreement and to perform its obligations hereunder, the
execution and delivery of this Agreement and the performance of its obligations
hereunder have been duly authorized by all requisite partnership action and
this Agreement constitutes the legal, valid and binding obligation of the MFW
and is enforceable against MFW in accordance with its terms;

 

C.            Neither the execution and delivery
of this Agreement nor the performance of its obligations hereunder by MFW
shall, or after the lapse of time or with the giving of notice shall, conflict
with, violate or result in a breach of, or constitute a default under the
organizational documents of MFW or any law, statute, rule or regulation
applicable to it, or conflict with, violate or result in a breach of or
constitute a default under any material agreement to which it is a party or by
which it or any of its properties is bound, or any judgment, order, award or
decree to which it is a party or by which it is bound, or require any approval,
consent, authorization or other action by any court, governmental authority,
agency or regulatory body (“Governmental Authority”), or any creditor of MFW
that will not be paid in full at or before Closing or any other person or
entity;

 

D.            No other person or entity has any
right to acquire the Subject Property (whether by option to purchase, right of
first refusal, contract or otherwise);

 

E.             MFW is not a foreign person and
agrees that a “FIRPTA” certification will be provided to SYMMETRY on the
Closing Date, in that Section 1445 of the Internal Revenue Code provides that
the transferee of a United States real property interest must deduct and
withhold a tax equal to ten percent (10%) of the amount realized by the
transferor on the disposition, if the transferor is a foreign person;

 

F.             MFW has not received any notice,
and has no knowledge, that the Real Property, or any portion or portions
thereof, is or will be subject to or affected by

 

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(i) any
special assessments, whether or not presently a lien thereon; or (ii) any
condemnation, eminent domain, or other similar proceeding;

 

G.            With respect to its ownership and
use of the Real Property, MFW has received no written notice that it is in
violation of any federal, state or local legal or regulatory requirement of any
kind or nature whatsoever, including, but not limited to, zoning, land use,
building, safety or health laws, regulations, ordinances or codes;

 

H.            There are no actions, suits or
proceedings of any kind or nature whatsoever, legal or equitable, affecting the
Real Property, or any portion or portions thereof, or relating to or arising
out of MFW’s ownership of the Real Property, in any court or before or by any
federal, state, county or municipal department, commission, board, bureau,
agency or other governmental instrumentality;

 

I.              There is no pending or, to MFW’s
knowledge, anticipated change in any applicable building, zoning, subdivision
and other land use and similar law that will have or result in a material
adverse effect upon the ownership, alteration, use, occupation or operation of
the Real Property or any portion thereof;

 

J.             Except as set forth in Schedule
3 attached hereto and made a part hereof by reference, no past or current
use by MFW is dependent on a non-conforming use or other applicable
governmental approval, the absence of which would materially limit the use of
the Real Property;

 

K.            There are no leases or other
agreements granting to any persons or third parties the right of use or occupancy
of any portion of the Subject Property (other than the Lease) that will survive
the Closing;

 

L.             Except as may be set forth in Schedule
4 and as set forth in the information contained in any site surveys and the
environmental reports listed in Schedule 4, copies of which have been
provided to SYMMETRY, and except as would not have a Material Adverse Effect:
(i) MFW and the Companies have at all times transported, stored, and/or
disposed of Hazardous Materials handled by MFW and the Companies in a manner
that is reasonably necessary for the conduct of the Business and in material
compliance with Environmental Laws, (ii) to MFW’s knowledge, the Real Property,
during its use by MFW and the Companies has not been used, as a landfill, dump
or other disposal, storage, transfer, treating or handling area for any
Hazardous Materials, except for such storage or handling of Hazardous Materials
as is reasonably necessary for the conduct of the Business and in material
compliance with Environmental Laws, (iii) to MFW’s knowledge, no asbestos, lead
paint, radioactive material, polychlorinated biphenyls, or urea formaldehyde
has been placed, stored, located or disposed on the Real Property, (iv) MFW and
the Companies have not agreed to assume and, to MFW’s knowledge, neither has
assumed by operation of law, any environmental Liability of any other Person,
including, but not limited to, environmental Liabilities under

 

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CERCLA or
SARA, and (v) MFW and the Companies have obtained and complied in all material
respects with, and are in material compliance with, all Environmental Permits
necessary or required for the operation of the Business, said Environmental
Permits are in full force and effect, and to MFW’s knowledge there are no
Proceedings pending or threatened to revoke or limit any thereof. Except as may
be set forth in Schedule 4 hereto, the Real Property is not listed on
the National Priorities List, the Comprehensive Environmental Response
Compensation and Liability Information System, the Resource Conservation and
Recovery Information System or any other governmental list of potentially
contaminated properties.

 

M.           Schedule 5 contains a true and
accurate copy of the Lease;

 

N.            MFW as landlord under the Lease has
received no notice from the tenant that it is in default of the terms and
conditions of the Lease, and, to its knowledge, the tenant under the Lease is
not in default of the terms and conditions of the Lease and has not prepaid any
rent or other monies such as real estate taxes which are deemed rent under the
Lease beyond what is required by the Lease;

 

O.            Wallace and Mann own all of the
partnership interests of MFW;

 

P.             MFW owns fee simple title to the
Real Property;

 

Q.            Any and all Project Contracts which
are not Assumed Contracts shall be terminated by MFW as of the Closing Date,
with MFW having fully paid and discharged any and all obligations accruing
thereunder;

 

R.            To MFW’s knowledge, all required
certificates of occupancy for the Real Property, and all other licenses,
permits, authorizations and approvals necessary for the operation of the Real
Property as currently used for the existing business, have been issued and are
in good standing, and all charges and fees for such certificates, permits and
approvals have been paid in full;

 

S.             All Tangible Personal Property, if
any, is owned by MFW free and clear of any and all liens and security interests
other than those to be satisfied by MFW at Closing, and all Tangible Personal
Property currently located in or on the Real Property is in operating
condition, normal wear and tear excepted; and

 

T.            MFW has not received any written
notice from any insurance company, board of fire underwriters or rating
organization (or other body exercising similar functions) (i) claiming any
defects or deficiencies in the Real Property which have not been addressed and
fully cured or corrected, or (ii) requesting the performance of any repairs,
alterations or other work which have not been performed, or (iii) claiming any
default which, if not corrected, would result in a cancellation of insurance
coverage.

 

U.            The outside of the
east wall of each and every building presently constructed on the Real Property
contains a brick facing.

 

12

 

V.            Except as expressly
set forth in this Section 15 and elsewhere in this Agreement, MFW hereby
specifically disclaims any warranty, guarantee or representation, oral or
written, past, present or future, of, as to or concerning; (i) the nature and
condition of the Real Property, including, without limitation, water, soil and
geology and other environmental conditions, and the suitability of the Real
Property for any and all activities and uses which SYMMETRY may elect to
conduct thereon; and (ii) the compliance of the Real Property or its operation
with any laws (including but not limited to Environmental Laws), ordinances or
regulations of any Governmental Authority. SYMMETRY acknowledges that having
been given a full and complete opportunity to inspect the Real Property,
SYMMETRY is relying solely on its own investigation of the Real Property and
the representations and warranties of MFW set forth in this Section 15 and
elsewhere in this Agreement. Subject to said representations and warranties,
the sale of the Real Property as provided for herein is made on an “AS IS”,
“WHERE IS” and “WITH ALL FAULTS” basis, and SYMMETRY expressly
acknowledges that, in consideration of the agreements of MFW herein, EXCEPT AS
OTHERWISE SPECIFIED HEREIN, SELLER MAKES NO WARRANTY OR REPRESENTATION,
EXPRESS OR IMPLIED, OR ARISING BY OPERATION OF LAW, INCLUDING, BUT NOT LIMITED
TO, ANY WARRANTY OF CONDITION, HABITABILITY, MERCHANTABILITY OR FITNESS FOR A
PARTICULAR PURPOSE, WITH RESPECT TO THE REAL PROPERTY. The provisions of this
Section 15.V shall survive the Closing and the termination of this Agreement.

 

W.           All real estate taxes on the Real
Property for the fiscal year ending December 31, 2006 have been paid in their
entirety. No real estate taxes are due and owing yet for the fiscal year
commencing January 1, 2007. Pursuant to the terms of the Lease, the tenant
under the Lease is responsible for any and all real estate taxes and
assessments for the Real Property.

 

X.            MFW does not hold
any security deposit under the Lease, nor does the Lease require the tenant to
have delivered same.

 

16.                               Representations and Warranties of SYMMETRY.

 

SYMMETRY hereby represents and warrants to
MFW as of the date hereof and agrees to confirm in a secretary’s certificate to
be delivered at the Closing that:

 

A.            SYMMETRY is a duly authorized and
validly corporation organized under the laws of the State of Delaware;

 

B.            SYMMETRY has full power and
authority to enter into this Agreement and to perform its obligations
hereunder, the execution and delivery of this Agreement and the performance of
its obligations hereunder have been duly authorized by all requisite company
action and this Agreement constitutes the legal, valid and binding obligation
of SYMMETRY, enforceable against SYMMETRY in accordance with its terms; and

 

13

 

C.            Neither the execution and delivery
of this Agreement nor the performance of its obligations hereunder by SYMMETRY
shall, or after the lapse of time or giving of notice shall, conflict with,
violate or result in a breach of, or constitute a default under the
organizational documents of SYMMETRY or any law, statute, rule or regulation
applicable to it, or conflict with, violate or result in the breach of or
constitute a default under any material agreement to which it is a party or by
which it or any of its properties is bound, or any judgment, order, award or
decree to which it is a party or by which it is bound, or require any approval,
consent, authorization or other action by any Governmental Authority, or any
creditor of SYMMETRY or any other person or entity.

 

17.                               Indemnification.

 

17.1                        By MFW.

 

MFW covenants
and agrees to defend, indemnify and hold harmless SYMMETRY, its officers,
directors, members, employees, agents, advisors, representatives and Affiliates
(collectively, the “SYMMETRY Indemnitees”) from and against, and pay or
reimburse SYMMETRY Indemnitees for, any and all Damages resulting from or
arising out of:

 

A.                                   the breach or
inaccuracy of any representation or warranty when made or deemed made by MFW in
this Agreement;

 

B.                                     the parking lot
matter described in Section 37 herein; and

 

C.                                     the breach or
violation of any covenant or other obligation of MFW under this Agreement.

 

17.2                        By
SYMMETRY.

 

SYMMETRY
covenants and agrees to defend, indemnify and hold harmless MFW, its officers,
directors, members, employees, agents, advisors, representatives and Affiliates
(collectively, the “MFW Indemnitees”) from and against, and pay or reimburse
MFW Indemnitees for, any and all Damages resulting from or arising out of:

 

A.                                   the inaccuracy of
any representation or warranty when made or deemed made by SYMMETRY in this
Agreement; and

 

B.                                     the breach or
violation of any covenant or other obligation of SYMMETRY under this Agreement.

 

17.3                        Certain
Definition.

 

For purposes of Section 17, the term “Damages” means any and all
damages (but excluding special, incidental, consequential or punitive damages),
losses, claims (including Taxes), expenses, costs, fines, consultant, expert,
attorney and professional fees, interest and penalties, and with respect to
indemnification for breach of the representations and warranties in Section
15.L, “Damages” shall mean such liabilities as 

 

14

 

referenced above arising out of or in connection with investigation of
site conditions or any clean up, remedial, removal or restoration work, or any
diminution in value or natural resource damage caused by: (i) the presence of
Hazardous Materials or (ii) any violation of Environmental Laws causing
physical injury to persons or property. “Damages” shall also include costs
incurred arising from claims, actions, suits, demands, assessments,
investigations, judgments, penalties, fines, awards, arbitrations or other
proceedings, together with reasonable attorneys’ fees and expenses.

 

17.4                        Survival.

 

The provisions of this Section 17 shall survive the termination of this
Agreement and the Closing of the transactions contemplated under this
Agreement.

 

18.                               Remedies.

 

18.1        Of SYMMETRY.

 

If SYMMETRY is
not then in default hereunder, and, subject to the conditions set forth herein,
if MFW fails to close the transaction contemplated hereby, SYMMETRY shall
elect, as its sole and exclusive remedy, either to (i) terminate this Agreement
by giving written notice of termination and receive a full and immediate refund
an amount (not to exceed the sum of Twenty Thousand and No/100 Dollars
($20,000.00)) equal to SYMMETRY’s out-of-pocket expenses spent in connection
with this Agreement or the purchase contemplated herein, or (ii) enforce
specific performance of the obligations of MFW hereunder.

 

18.2        Of MFW.

 

If MFW is not
in default, and if this Agreement is not terminated by reason of failure of any
condition precedent to Closing hereunder and if SYMMETRY fails to close the
transaction contemplated hereby or defaults under a provision hereof, MFW shall
elect, as its sole and exclusive remedy, either to (i) terminate this Agreement
by giving written notice of termination and receive a full and immediate refund
an amount (not to exceed the sum of Twenty Thousand and No/100 Dollars
($20,000.00)) equal to MFW’s out-of-pocket expenses spent in connection with
this Agreement or the sale contemplated herein, or (ii) enforce specific
performance of the obligations of SYMMETRY hereunder.

 

18.3        Survival.

 

The provisions of this Section 18 shall survive the termination of this
Agreement.

 

19.                               Personal
Property Taxes.  

 

MFW shall be responsible and obligated to pay
all personal property taxes respecting the Tangible Personal Property which are
assessed and charged by the State of Tennessee and local tax authorities in
Tennessee prior to Closing. SYMMETRY shall be responsible and obligated to pay
all such personal property taxes which are assessed and charged by the State of
Tennessee and local tax authorities in Tennessee after Closing. SYMMETRY shall
pay all sales taxes and 

 

15

 

fees charged to transfer title to the
Tangible Personal Property. Without affecting any other section herein, this
Section 19 shall survive the Closing.

 

20.                               Reasonable
Consent.  

 

Whenever SYMMETRY’s or MFW’s approval or
consent shall be requested pursuant to this Agreement, such approval or consent
shall not be arbitrarily or unreasonably conditioned, delayed, or withheld and
(except with respect to draft documents proffered for review) shall be deemed
to have been given, unless within five (5) days of the request therefor,
SYMMETRY or MFW, as appropriate, notifies the requesting party that SYMMETRY or
MFW, as appropriate is denying such approval or consent, stating in such notice
the reasonable grounds therefor.

 

21.                               Attorney
Fees.  

 

If either party commences an action against
the other to enforce any of the terms of this Agreement or because of the
breach by the other party of any of the terms of this Agreement, the losing or
defaulting party shall pay to the prevailing party its reasonable attorneys’
fees, costs and expenses incurred by it in connection with the prosecution or
defense of such action.

 

22.                               Notices.

 

Except as otherwise provided herein, all
communications, demands, notices, or objections permitted or required to be
given or served under this Agreement shall be in writing and shall be deemed to
have been duly given or served (a) upon receipt if (i) delivered in person or
(ii) delivered by recognized overnight courier service, or (b) three (3)
business days after receipt of such notice in registered or certified mail, at
the address set forth in each party’s signature block below.

 

23.                               Binding
Effect.  

 

This Agreement shall be binding on and shall
inure to the benefit of the parties hereto and their respective successors and
permitted assigns.

 

24.                               Amendment;
Modification; Waiver.

 

Except only as expressly provided to the contrary
herein, no amendment, modification, or waiver of any condition, provision, or
term shall be valid or of any effect unless made in writing, signed by the
party or parties to be bound or a duly authorized representative, and
specifying with particularity the extent and nature of such amendment,
modification, or waiver. Any waiver by any party of any default of another
party shall not affect or impair any right arising from any subsequent default.

 

25.                               Complete
Agreement; No Merger.

 

This Agreement and the Schedules attached
hereto, together with the Purchase Agreement, is intended by the parties as the
final written expression of their agreement, shall constitute the entire
agreement between the parties hereto with respect to the subject matter hereof,
and shall supersede all previous negotiations, commitments and writings with
respect to such subject 

 

16

 

matter. The terms, covenants, representations
and warranties made, and conditions to be performed, or which may be performed
subsequent to the Closing, shall not merge with any of the documents exchanged
at the Closing.

 

26.                               Severability.

 

Each provision, section, sentence, clause,
phrase, and word of this Agreement is intended to be severable. If any provision,
section, sentence, clause, phrase, or word hereof is illegal or invalid for any
reason whatsoever, such illegality or invalidity shall not affect the validity
of the remainder of this Agreement.

 

27.                               Captions,
Headings and Titles.  

 

All captions, headings and titles in the
paragraphs or sections of this Agreement are inserted for convenience of
reference only and shall not constitute a part of this Agreement as a
limitation of the scope of the particular paragraphs or sections to which they
apply.

 

28.                               Reference
to Gender.  

 

Where appropriate, the feminine gender may be
read as the masculine gender or the neuter gender, the masculine gender may be
read as the feminine gender or the neuter gender, and the neuter gender may be
read as the masculine gender or the feminine gender.

 

29.                               Governing
Law.  

 

This Agreement shall be governed, construed
and enforced in accordance with the laws of the State of Tennessee.

 

30.                               Assignment.

 

Other than an assignment to an Affiliate of
SYMMETRY, SYMMETRY may not assign its interest under this Agreement without the
express written consent of MFW. Upon any such assignment made, SYMMETRY shall
provide written notice to MFW prior to Closing. MFW may not, however, assign
its interest under this Agreement under any circumstances.

 

31.                               Counterparts.

 

This Agreement may be executed by fax or
electronic mail in counterparts, each of which shall be deemed an original and
all of which, taken together, shall constitute one document.

 

32.                               No
Recording.  

 

Neither this Agreement nor any memorandum
hereof may be placed by either party into the public record.

 

33.                               No
Public Disclosure.

 

MFW and SYMMETRY each agrees to
abide by all public disclosure related provisions set forth in the Purchase
Agreement.

 

17

 

34.                               Undefined
Terms.

 

Terms capitalized but not
defined in this Agreement shall have and carry the same meanings as set forth
in the Purchase Agreement.

 

35.                               Survival
of Representations and Warranties.

 

MFW and SYMMETRY hereby agree:
(i) the representations and warranties in Section 15.A, B, and C and Section
16.A, B and C shall have no expiration; (ii) the representations and warranties
in Section 15.L will survive the applicable statute of limitations plus sixty
(60) days; (iii) except as noted above in this Section 35, all of the
representations and warranties made by MFW and SYMMETRY under this Agreement
will terminate upon the second (2nd) year anniversary of the Closing
Date; and (iv) all covenants of the parties hereto will survive until performed
or satisfied in accordance with their respective terms.

 

36.                               Cumulative
Rights.

 

Except as may otherwise be provided elsewhere
in this Agreement, no right or remedy conferred on or reserved to SYMMETRY or
MFW is intended to be exclusive of any other right or remedy provided herein or
by law, but such rights and remedies shall be cumulative in and in addition to
every other right or remedy given in this Agreement or hereafter existing at
law and in equity (including specific performance), of which the parties are
permitted to avail themselves.

 

37.          Parking Lot.

 

MFW hereby acknowledges that the current
condition of the parking lot on the Real Property lacks handicap spaces. MFW
covenants to perform not later than thirty (30) days after the Closing Date all
parking lot improvements which are required by applicable local, state and
federal laws (including, without limitation, the Americans with Disabilities
Act) in connection with the requirement for handicap parking. Notwithstanding
the foregoing, MFW shall not cause any reduction to the current number of
parking spaces at the Real Property.

 

[the rest of
this page is intentionally left blank]

 

18

 

IN WITNESS
WHEREOF, MFW and SYMMETRY have caused this Agreement
to be executed effective the date and year first set forth hereinabove.

 

	
  “SYMMETRY” 

  SYMMETRY MEDICAL USA INC.,

  a Delaware corporation 

  	
  

  Address:

  

  220 West Market Street

  
	
  By:

  	
  /s/ Fred L. Hite

  	
   

  	
  Warsaw, Indiana 46580

  
	
   

  	
  Fred L. Hite, Chief Financial Officer

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   “MFW”

  MFW INVESTMENTS,

  a Tennessee general partnership 

  	
  

  Address:

  

  200 River Hills Drive

  
	
  By:

  	
  /s/ Louis C. Wallace

  	
   

  	
  Nashville, Tennessee 37210

  
	
   

  	
  Louis C. Wallace, Partner

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Charles O. Mann, Jr.

  	
   

  	
   

  
	
   

  	
  Charles O. Mann, Jr., Partner

  	
   

  	
   

  

 

19

 

DISCLOSURE SCHEDULES

TO THE

REAL PROPERTY SALE AND PURCHASE AGREEMENT

BY AND AMONG

SYMMETRY MEDICAL USA, INC.

(“PURCHASER”)

AND

MFW INVESTMENTS

(“SELLER”)

 

DATED: AUGUST 29, 2007

 

Schedules

1
– Land Description

 

2
– Excluded Tangible Personal Property

 

3
– Non-Conforming Use of Property

 

4
– Hazardous Materials

 

5
– Lease

 

20Exhibit 10.3

 

EARN-OUT AGREEMENT

 

THIS EARN-OUT AGREEMENT (the “Agreement”), dated
August 29, 2007 and effective upon Closing of the Purchase Agreement (“Effective
Date”), is made and entered into by and among Symmetry Medical USA, Inc., a
Delaware corporation (“Purchaser”), and Louis C. Wallace, individually (“Wallace”)
and Charles O. Mann, Jr., individually (“Mann”) (collectively, “Seller”).

 

WHEREAS,
Purchaser and Seller are parties to a certain Purchase Agreement dated of even
date herewith (the “Purchase Agreement”) pursuant to which Purchaser is
acquiring: (i) 100% of the outstanding stock of Specialty Surgical
Instrumentation, Inc. a Tennessee corporation (“SSI”) which owns the Specialty
Surgical Instrumentation distribution and SSI Ultra instrument businesses; and
(ii) 100% of the outstanding Membership Interests of UCA, LLC (“UCA”), a
Tennessee limited liability company.

 

WHEREAS,
in conjunction with the Purchase Agreement and a related Real Estate Purchase
Agreement, Purchaser will be acquiring certain real estate necessary to conduct
the business of SSI and UCA (such owned properties are collectively referred to
in this Agreement as the “Facilities”).

 

WHEREAS, Purchaser and
Seller have agreed that an additional amount of consideration is payable under
the Purchase Agreement if and only to the extent that certain EBITDA levels are
exceded post Closing.

 

NOW,
THEREFORE, in consideration of the premises and the mutual promises herein
contained, the parties agree as follows:

 

1.                                       Definitions.

 

Capitalized terms used
but not defined herein shall have the same meanings given them in the Purchase
Agreement, as applicable.

 

2.                                       Earn-Out
Payments. Earn-Out Payment shall be calculated for the 12-month period
ending August 31, 2008 and the 12-month period ending August 31, 2009
(collectively, the “Earn-Out Periods”) in the following manner:

 

(a)                                  SSI:

 

(i)                                     Subject to the credits and
adjustments set forth in Section 4, in the event that the SSI’s EBITDA for the
12 months ending August 31, 2008 exceeds $1,815,000, Purchaser shall pay to
Seller an amount equal to six (6) times the excess;

 

Example #1: If SSI’s EBITDA is $2,000,000 for the 12-month
period ending August 31, 2008, Purchaser would owe Seller $1,110,000 (6 x
$185,000).

 

 

Example #2: If SSI’s EBITDA is $1,750,000  for the 12-month period ending August 31,
2008, Purchaser would owe Seller $0.

 

(ii)                                  Subject to the credits and
adjustments set forth in Section 4, in the event that the SSI’s EBITDA for 12
month period ending August 31, 2009 exceeds the greater of (x) $1,815,000 or
(y) SSI’s EBITDA for the 12-month period ending August 31, 2008; Purchaser
shall pay to Seller an amount equal to six (6) times the excess.

 

(b)                                 UCA:

 

(i)                                     Subject to the credits and
adjustments set forth in Section 4, Purchaser shall pay to Seller an amount
equal to four (4) UCA’s EBITDA for the 12-month period ending August 31, 2008.

 

Example #1: If UCA’s EBITDA was $800 for the 12-month
period ending August 31, 2008 Purchaser would owe Seller $3200 (4 x $800).

 

(ii)                                  Subject to the credits and
adjustments set forth in Section 4, in the event that the UCA’s EBITDA for the
12-month period ending August 31, 2009 exceeds the greater of (x) $0 or (y) UCA’s
EBITDA for the 12-month period ending August 31, 2008; Purchaser shall pay to
Seller an amount equal to four (4) times the difference.

 

Example #1: If UCA’s EBITDA was $800 for the 12-month
period ending August 31, 2008 and was $800 (or less) for the 12-month period
ending August 31, 2009, Purchaser would owe Seller $0.

 

3.                                       Certain
Procedures and Requirements.

 

(a)                                        Within ninety (90) days after the end of
the respective Earn-Out Periods set forth in Section 2, Purchaser shall
report SSI’s and UCA’s EBITDA (pursuant to generally accepted accounting
principles as adjusted below) along with the corresponding projected Earn-Out
Payment to Seller. The Seller shall have thirty (30) days from receipt of
Purchaser’s payment calculations to dispute the calculations and such dispute
must be in writing. Seller will be given reasonable access to books and records
during the term of this Agreement. Parties shall attempt to resolve any
disputes among themselves, but if unable to resolve, the parties will submit
the calculations to a mutually agreed upon independent accounting firm of
regional or national reputation whose determination shall be definitive. If the
Purchaser does not receive written notice from the Seller within the thirty
(30) day period, the Purchaser’s calculation of EBITDA and related Earn-Out
Payments shall be deemed conclusive for all purposes.

 

(b)                                       Payments (if any) required by Section 2
of this Agreement shall be made within one hundred and twenty (120) days after
the end of each respective Earn-Out Period. Such payments shall be made without
interest.

 

2

 

4.                                       Credits
and Adjustments.

 

(a)                                  Credit
Adjustment to Earn-Out Payment.

 

(i)                                     Credit.
Purchaser shall receive a credit in the aggregate amount of $400,000 toward
Earn-Out Payments due and owing Seller under Section 2 (the “Earn-Out Credit”).

 

Example #1: If, in the first year (for the period
ending August 31, 2008), Purchaser owes Seller $200,000 under Section 2(a)(i)
and $200,000 under Section 2(b)(i), after credit adjustment, Purchaser would
owe Seller $0. The second year there would be no credit adjustment.

 

Example #2: If, over a period of two years (for the
periods ending August 31, 2008 and August 31, 2009), Purchaser owes Seller
$100,000 under Section 2(a)(i) and $100,000 under Section 2(b)(i), $100,000
under Section 2(a)(ii) and $200,000 under Section 2(b)(ii), after credit
adjustment, Purchaser would owe Seller $0 in the first year and $100,000 in the
second year.

 

(ii)                                  Payment
for Unapplied Earn-Out Credit. In the event
that any or all of the Earn-Out Credit remains unapplied at the termination of
this Agreement, Seller shall pay Purchaser an amount equal to the amount of any
unapplied Earn-Out Credit. At the sole discretion of Purchaser, such payment
may be made as a deduction from the Escrowed Funds or Purchaser may require
that Sellers pay the amount directly to Purchaser.

 

(b)                                 Adjustments
to EBITDA. EBITDA will be adjusted by Purchaser for the following items:

 

(i)                                     Sales of SSI/UCA products by Purchaser’s sales force to Purchaser customers would result in a 10% sales
commission paid to Purchaser or will be sold to Purchaser at 90% of the external sales price;

 

(ii)                                  General insurance coverage; leases, audit
fees will be paid to headquarters at historic rates and Corporate will absorb
any favorable or unfavorable

 

(iii)                               Changes in accounting methods; and GAAP purchase accounting
adjustments;

 

(iv)                              All extraordinary items outside of the ordinary course of business such
as lawsuits, settlement of lawsuits and similar events; or

 

(v)                                 Fluctuations resulting from timing of sales
cutoff.

 

3

 

(vi)                              All intercompany or related
party transactions between SSI and UCA. All transactions between SSI or UCA and other entities
owned by Seller shall be pre-approved.

 

(c)                                  Adjustments
Based on Operational Changes. SSI or UCA will not be allocated any share of
Purchaser overhead, advertising costs, taxes, securities regulatory costs,
audit/accounting fees in excess of SSI’s currently budgeted amount, costs
associated with Sarbanes-Oxley compliance, laboratory or research costs,
executive or other personnel costs (including travel and other expenses), or
any severance pay associated with any terminations (other than “for cause”). Except
as set forth in Section 4(d) below, material and substantial operational changes
that may result in adjustments to EBITDA must be pre-approved, in writing, by
both Purchaser and Seller. Examples of such operational changes may include,
but are not limited to, the following:

 

•                  Any
structural changes implemented by Purchaser at the Facilities;

 

•                  Any
purchases of capital equipment made by Purchaser for use at the Facilities;

 

•                  Any transfers of customer orders from one of
Purchaser’s other locations for production at the Facilities;

 

•                  Any transfers of products produced at one of Purchaser’s other locations for sale by SSI or UCA;

 

•                  Production or sale of existing Purchaser
products at the Facilities;

 

•                  Sales of SSI/UCA products by Purchaser’s
sales force to Purchaser Customers; and/or

 

•                  Any increase related to the Company’s expansion
into Europe or other foreign countries.

 

(d)                                 Adjustments
Based on Voluntary Termination and “for Cause” Termination.

 

(i) As
detailed in Section 5(a) below, in the event that both Wallace and Mann are no
longer employed by
Purchaser, either as a result of their voluntary termination or as a
result of termination “for Cause,” as defined in Section 6(c)(i) or
Section 6(c)(iv) of their respective Employment Agreements, EBITDA may be adjusted at Purchaser’s
reasonable discretion for changes including, but not limited to, those set
forth in Section 4(c) above. Adjustments under this Section 4(d)(i) may
be made without written approval from Seller.

 

(ii)
As detailed in Section 5(a) below, in the event that both Wallace and Mann are
no longer employed by
Purchaser as a result of termination “for Cause,” as defined in
Sections 6(c)(v), 6(c)(vi) and 6(c)(vii) of their respective 

 

4

 

Employment Agreements, EBITDA may be adjusted at Purchaser’s
reasonable discretion for changes including, but not limited to, those set
forth in Section 4(c) above. Adjustments under this Section 4(d)(ii) in
the amount of $500,000 or less may be made without written approval from Seller.
Adjustment greater than $500,000 must
be pre-approved, in writing, by both Purchaser and Seller.

 

(e)                                  Right
of Set-Off. Seller has undertaken certain obligations of indemnification
pursuant to Article 7 of the Purchase Agreement and agrees that, in the event
that Purchaser has an indemnification claim against Seller under the terms of
the Purchase Agreement at the time payments are required pursuant to Section 2
of this Agreement, Purchaser may, at its election, offset by the amount of the
claim, any payments due and owing Seller against the outstanding claims
established pursuant to Article 7 of the Purchase Agreement.

 

5.                                       Termination.
This Agreement shall commence on the Effective Date and shall continue until
such time as both parties have satisfied their obligations hereunder. This
Agreement may terminate at an earlier date upon the occurrence of one of the
following:

 

(a)                                  Voluntary
Termination and “for Cause” Termination. Except as otherwise stated in
Section 5(b), if both Wallace or Mann are no longer employed by Purchaser, either as a result of their
voluntary termination or as a result of termination “for Cause,” as defined in
Section 6(c) of their respective Employment Agreements, this Agreement
shall continue subject to the adjustments set forth in Section 4(d).

 

(b)                                 Terminations
for Fraud or Felony. Notwithstanding Section 5(a) above, if either Wallace
or Mann are terminated “for Cause” due to fraud, embezzlement, theft or
comparable dishonest activity or if either Wallace or Mann is convicted, enters
a plea of guilty or no contest to any crime constituting a felony, the
Purchaser’s payment obligations under this Agreement shall cease, this
Agreement shall terminate and Purchaser shall have no further payment
obligations under this Agreement. 

 

(c)                                  Death.
If either Wallace or Mann remains living throughout the duration of this
Agreement, the Agreement shall continue until such time as both Purchaser and
Seller have satisfied their obligations hereunder unless earlier terminated
pursuant to Section 5(b) of this Agreement.

 

(d)                                 Permanent
Disability. If either Wallace or Mann remains without permanent disability
throughout the term of this Agreement, the Agreement shall continue until such
time as both Purchaser and Seller have satisfied their obligations hereunder
unless earlier terminated pursuant to Section 5(b) of this Agreement.

 

6.                                       Dispute
Resolution.

 

(a)                                  Negotiation. 
Except with regard to disputes arising out of or relating to calculations of
EBITDA and projected Earn-Out Payments, the procedures of which are set forth
in Section 3 above, the parties shall attempt to resolve any dispute arising
out of or relating to this Agreement (each a “Dispute”), promptly by good faith
negotiation among representatives who have authority to resolve the
controversy.  Any party shall 

 

5

 

give the other party written
notice of any Dispute not resolved in the normal course of business. 
Within fifteen (15) business days after delivery of such notice, the receiving
party shall submit to the other party a written response.  The notice and
the response shall include (i) a statement of the party’s concerns and
perspectives on the Dispute, (ii) a summary of supporting facts and
circumstances, and (iii) the identity of the representative who will
represent such party.  Within thirty (30) calendar days after delivery of
the original notice, the representatives of the parties shall meet at a
mutually acceptable time and place, and thereafter as often as they reasonably
deem necessary, to attempt to resolve the Dispute.  All negotiations
pursuant to this subsection (a) and subsection (b) below are confidential
and shall be treated as compromise and settlement negotiations for purposes of
applicable rules of evidence.

 

(b)                                 Mediation.  If a Dispute is not resolved by discussion between the parties,
either party may by notice to the other party require mediation of such
Dispute, which notice shall identify the names of no fewer than three (3)
potential mediators.  Each party agrees to participate in mediation of the
Dispute and will in good faith attempt to agree upon a mediator.  If the
parties are unable to agree upon a mediator within fifteen (15) business days
after such notice, or if such Dispute shall not have been resolved by mediation
within sixty (60) days after such notice, then either party may file for
arbitration pursuant to subsection (c) below.  All expenses of the
mediator shall be equally shared by the parties.

 

(c)                                  Binding Arbitration.

 

(i)                                     The place of arbitration shall be Fort Wayne,
Indiana.

 

(ii)                                  The award rendered by the
arbitrators shall be in writing and shall include a statement of the factual
bases and the legal conclusions relied upon by the arbitrators in making such
award.  The arbitrators shall decide the Dispute in compliance with the
applicable substantive law and consistent with the provisions of this
Agreement, including limits on damages.  The award rendered by the
arbitrators shall be final and binding, and judgment upon the award may be
entered by any court having jurisdiction.

 

(iii)                               All matters relating to the
enforceability of the arbitration provisions of this Agreement and any
arbitration award rendered pursuant to this Agreement shall be governed by the
Federal Arbitration Act, 9 U.S.C. § 1-16.

 

(iv)                              Nothing in this Section 6
shall limit the rights of the parties to obtain provisional, ancillary or
equitable relief from a court of competent jurisdiction.

 

(v)                                 Each party shall pay its own expenses of
arbitration and the expenses of the arbitrators shall be equally shared;
provided, however, if in the opinion of the arbitrators any claim by either
party hereunder or any defense or objection thereto by the other party was
unreasonable and not made in good faith, the arbitrators may assess as part of
the award, all or any part of the arbitration 

 

6

 

expense (including, without
limitation, reasonable attorneys’ fees) of the non-offending party and of the
arbitrators against the party raising such unreasonable claim, defense or
objection.  Nothing herein shall prevent the parties from settling the
Dispute by mutual agreement at any time.

 

7.                                       Miscellaneous.

 

(a)                                  No Third-Party Beneficiaries. Nothing implied in this Agreement is
intended or shall be construed to confer any rights or remedies under or by
reason of this Agreement upon any Person other than Purchaser and Seller and
their respective representatives, successors and permitted assigns.

 

(b)                                 Entire Agreement. This Agreement contains
the entire understanding of the parties hereto as it pertains to the Earn-Out
Payments and with regard to the subject matter contained herein, and supersedes
all prior agreements, understandings or letters of intent between or among any
of the parties hereto, including that certain letter of intent and proposed
nonbinding term sheet dated May 22, 2007, and amended on July 24, 2007, between
Purchaser and Seller.

 

(c)                                  Succession and Assignment. This Agreement shall be binding upon and inure to
the benefit of the parties hereto and their respective heirs, personal
representatives, successors and permitted assigns, nothing in this Agreement is
to be construed as an authorization or right of any party to assign its rights
or delegate its duties under this Agreement without the prior written consent
of the other parties hereto. Notwithstanding the foregoing, Purchaser, in its
sole discretion, may assign its rights in and/or delegate its duties under this
Agreement to an Affiliate of Purchaser. In the event of such an assignment of
rights and/or delegation of duties, all references to Purchaser, as applicable
to the assignment in this Agreement, shall also be deemed to be references to
the Person to which this Agreement is assigned; provided that no such
assignment and/or delegation shall relieve the assignor of any of its duties or
obligations hereunder.

 

(d)                                 Counterparts. This Agreement may be
executed in one or more counterparts, each of which shall be deemed an original
but all of which together will constitute one and the same instrument.

 

(e)                                  Headings. The headings of the articles, sections and subsections
of this Agreement are intended for the convenience of the parties only and
shall in no way be held to explain, modify, construe, limit, amplify or aid in
the interpretation of the provisions hereof. The terms “this Agreement,” “hereof,”
“herein,” “hereunder,” “hereto” and similar expressions refer to this Agreement
as a whole and not to any particular article, section, subsection or other
portion hereof.

 

(f)                                    Notices. All notices, demands and other communications
provided for hereunder shall be in writing and shall be given (i) by
personal delivery, (ii) via e-mail or facsimile transmission (receipt
confirmed, with follow up transmittal within 48 hours by (iii) or (iv) which
follows), (iii) by nationally recognized overnight courier (prepaid), or
(iv) by certified or registered first class mail, postage prepaid, return
receipt requested,

 

7

 

sent to each party, at
its and its representative’s address as set forth below or at such other
address or in such other manner as may be designated by such party or the
respective representative in a written notice to each of the other parties:

 

If to Seller:                                                                                     Louis C. Wallace

c/o Specialty Surgical Instrumentation, Inc.

200 River Hills Drive

Nashville, TN 
37210

E-Mail: 
LouWallace@specialty-surgical.com

 

and

 

Charles O. Mann, Jr.

c/o Specialty Surgical Instrumentation, Inc.

200 River Hills Drive

Nashville, TN 
37210

E-Mail: charlesmann.ssi@starband.net

 

With
a copy to:                                     John L. Van Cleave

Watkins & McNeilly, PLLC

Suite 300, 314 Second Avenue North

Nashville, TN

E-Mail: 
john@watkinsmcneilly.com

Phone: 
615-255-2191

Fax No.: 
615-242-0238

 

To Purchaser:                                              Symmetry Medical USA Inc.

220 West Market Street

Warsaw,
IN 46580

E-Mail: 
fred.hite@symmetrymedical.com

Fax No.: 
574-267-4551

Attention: 
Fred Hite, Chief Financial Officer

 

With a copy to:                                     Barrett & McNagny LLP

215 East Berry Street

Fort Wayne, IN 46802

E-Mail: 
sjt@barrettlaw.com

Phone: 
260-423-8812

Fax No.: 
260-423-8920

Attention: Samuel J. Talarico,
Jr.

 

(g)                                 Amendments and
Waivers. No purported
amendment, modification or waiver of any provision of this Agreement or any of
the documents, instruments or agreements to be executed by the parties pursuant
hereto shall be effective unless in writing specifically referring to this
Agreement and signed by all of the parties hereto.

 

8

 

(h)                                 Severability. In the event that any provision of this
Agreement is declared or held by any court of competent jurisdiction to be
invalid or unenforceable, such provision shall be severable from, and such
invalidity or unenforceability shall not be construed to have any effect on,
the remaining provisions of this Agreement, unless such invalid or
unenforceable provision goes to the essence of this Agreement, in which case
the entire Agreement may be declared invalid and not binding upon any of the
parties.

 

(i)                                     Expenses. Each party hereto shall pay their own fees
and expenses incurred in connection with negotiating and preparing this
Agreement and consummating the transaction contemplated hereby, including but
not limited to fees and disbursements of their respective attorneys,
accountants and investment bankers.

 

(j)                                     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 shall be construed
as if drafted jointly by the parties and no presumption or burden of proof
shall arise favoring or disfavoring any party by virtue of the authorship of
any of the provisions of this Agreement. The words “including,” “include” or “includes”
shall mean including without limitation. The parties intend that each
representation, warranty and covenant contained herein shall have independent
significance. If any 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.

 

[SIGNATURE PAGE TO FOLLOW]

 

9

 

IN
WITNESS WHEREOF, the parties hereto have executed this Agreement on the date
first above written.

 

 

	
  Seller:

  	
   

  	
  Purchaser:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Symmetry
  Medical USA Inc.

  
	
  /s/ Louis C. Wallace

  	
   

  	
  By
  its duly authorized officer

  
	
  Louis C. Wallace

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Sign:
  

  	
  /s/
  Fred L. Hite

  	
   

  
	
  /s/ Charles O. Mann, Jr.

  	
   

  	
  Name:

  	
  Fred
  L. Hite

  
	
  Charles
  O. Mann, Jr.

  	
   

  	
  Title:

  	
  Chief
  Financial Officer

  
						

 

10

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