Document:

exv10w2

 

Exhibit 10.2

UNIT REPURCHASE AGREEMENT

                  THIS UNIT REPURCHASE AGREEMENT, dated as of April 13, 2002 (together with
the Exhibits hereto, this “Agreement”), is by and among The Hillman Companies,
Inc., a Delaware corporation (formerly known as SunSource Inc.) (“SunSource”),
SUNSUB HOLDINGS, LLC., a Delaware limited liability company and wholly-owned
subsidiary of SunSource, together with its successors and assigns (“SunSub”,
and collectively with SunSource, the “SunSource Entities”), GC-SUN HOLDINGS,
L.P., a Delaware limited partnership (the “Partnership”).

RECITALS

                  WHEREAS, pursuant to the Contribution Agreement between SunSource, certain
of its affiliates and the Partnership, dated February 10, 2000 and amended on
March 2, 2000 (the “Contribution Agreement”), SunSource contributed its
membership interest in Kar Products, LLC and the capital stock of A. & H. Bolt
& Nut Company Limited, a company organized under the laws of the Province of
Ontario (“A&H Bolt”), and SunSource Canada Investment Company, an unlimited
liability company organized under the laws of the Province of Nova Scotia
(collectively, the “SunSource Contribution”), to the Partnership on March 2,
2000, in exchange for an interest in the Partnership;

                  WHEREAS, on October 4, 2000, SunSource’s interest in the Partnership was
transferred and assigned to SunSub;

                  WHEREAS, pursuant to Sections 9.5 and 9.6 of the Fourth Amended and
Restated Agreement of Limited Partnership of GC-SUN Holdings, L.P., dated
December 5, 2001 (the “Partnership Agreement”), the Partnership has the right
to call SunSub’s Class B Units and Class F Units of the Partnership
(collectively, “SunSub Units”);

                  WHEREAS, on January 4, 2002, the Partnership exercised it call rights
pursuant to Sections 9.5 and 9.6 of the Partnership Agreement and provided
SunSub with the requisite notice of such call exercises in accordance with the
terms of the Partnership Agreement; and

                  WHEREAS, the parties have mutually agreed to the terms of the repurchase
of the SunSub Units pursuant to Sections 9.5 and 9.6 of the Partnership
Agreement and SunSub and the Partnership wish to hereby evidence such agreement
and the repurchase of SunSub’s Class B Unit and Class F Units by the
Partnership.

                  NOW, THEREFORE, in consideration of the respective representations,
warranties, covenants, conditions, agreements and premises contained herein and
for other good and valuable consideration, the receipt and adequacy of which
are hereby acknowledged, the parties hereby agree as follows:

 

 

ARTICLE I.

PURCHASE AND SALE

                  Section 1.1       Purchase and Sale of Shares. Upon the terms and conditions of
this Agreement, at the Closing, SunSub hereby agrees to sell, transfer, convey,
assign and deliver to the Partnership, free and clear of any Liens, and the
Partnership hereby agrees to purchase, acquire and accept from SunSub the
SunSub Units for the consideration described in Section 1.2 below (the “Unit
Purchase”).

                  Section 1.2       Purchase Price

                  The aggregate consideration for the SunSub Units shall be TEN MILLION
DOLLARS AND ZERO CENTS ($10,000,000.00) (the “Purchase Price”), which amount
shall be payable at the Closing, by issuance of the Note by the Partnership to
SunSub.

                  Section 1.3       Closing. The closing of the Unit Purchase and the other
transactions contemplated by this Agreement (the “Closing”) shall take place on
the first Business Day after satisfaction or waiver (as permitted by this
Agreement and applicable law) of the conditions to Closing (other than those
conditions that, by their terms, cannot be satisfied until the Closing Date)
set forth in Article VI (the “Closing Date”), unless another time or date is
agreed to in writing by the parties hereto. The Closing shall be held at a
location or by other means mutually agreed upon by the parties hereto.

                  Section 1.4       Closing Procedures and Deliveries.

                  (a)       Transfer and Delivery of Shares. To effect the sale and transfer of
the SunSub Units, at the Closing SunSub shall transfer and deliver to the
Partnership the Unit certificates representing the SunSub Units, free and clear
of any Liens of any nature whatsoever, duly endorsed in blank for transfer, or
accompanied by irrevocable stock powers duly executed in blank, in either case
by the holders of record of such Units.

                  (b)       Issuance of Note. At the Closing, upon receipt of the SunSub Units as
provided in Section 1.1, the Partnership shall issue the Note to SunSub in
accordance with Section 1.2 hereof.

                  (c)       Certificates; Opinions and Documents. At the Closing, the Partnership
and the SunSource Entities shall deliver the certificates, opinions and
documents described in Article V of this Agreement required to be delivered at
Closing as conditions to Closing.

                  (d)       Other Closing Transactions. At the Closing, each of the parties
hereto shall take such other actions reasonably required hereby to be performed
by it prior to or on the Closing Date, including, without limitation,
satisfying the conditions set forth in Article V of this Agreement.

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ARTICLE II.

REPRESENTATIONS AND WARRANTIES OF SUNSOURCE

                  SunSource represents and warrants to the Partnership that the statements
contained in this Article II are correct and complete as of the date of this
Agreement and will be correct and complete as of the Closing Date (as though
made at such time and as though the Closing Date were substituted for the date
of this Agreement throughout this Article II).

                  Section 2.1       Ownership of SunSub Units. SunSub is the sole owner,
beneficially and of record, of the SunSub Units, free and clear of any Liens.
At the Closing, such SunSub will transfer good and valid title to the SunSub to
the Partnership free and clear of any Liens.

                  Section 2.2       Organization. SunSub is duly formed, validly existing and in
good standing under the laws of the State of Delaware. SunSource is duly
incorporated, validly existing and in good standing under the laws of the State
of Delaware.

                  Section 2.3       Authority; Enforceablity. Each of the SunSource Entities has
all requisite corporate or company power and authority, and prior to Closing
will have taken all corporate or company actions necessary, to execute and
deliver the Note and this Agreement, to consummate the transactions
contemplated by this Agreement, and to perform their respective obligations
hereunder and thereunder. The execution and delivery by each of the SunSource
Entities of this Agreement and the Note and the consummation by each of
SunSource Entities of the transactions contemplated hereby and thereby have
been duly approved by the requisite governing bodies of such entities. No
other proceedings on the part of the SunSource Entities are necessary to
authorize the execution and delivery of this Agreement and the Note and the
consummation of the transactions contemplated hereby and thereby. This
Agreement has been duly executed and delivered by each of the SunSource
Entities party hereto, and constitutes the legal, valid and binding obligation
of each of the SunSource Entities, enforceable against each such entity in
accordance with its terms, subject to the effects of bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium and other similar Laws
relating to or affecting creditors’ rights generally and general equitable
principles (whether considered in a proceeding in equity or at law).

                  Section 2.4       No Violations. Except as provided in Schedule 2.4 hereof, the
execution, delivery or performance by the SunSource Entities of this Agreement
and the Note and the consummation of the transactions contemplated hereby and
thereby and the compliance by each of the SunSource Entities with any of the
provisions hereof, do not and will not (a) violate, conflict with or result in
the breach of any provision of the Organizational Documents of either of the
SunSource Entities, (b) conflict with or violate any Law or Governmental Order
pertaining to the SunSource Entities, or (c) conflict with, result in any
breach of, constitute a default (or event which with the giving of notice or
lapse of time, or both, would become a default) under, require any consent
under, or give to others any rights of termination, amendment or
acceleration of, or result in the creation of any Lien on the SunSub Units
pursuant to, any Contract to which any of the SunSource Entities is a party or
subject or by which any of the SunSource Entities is bound or affected.

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                  Section 2.5       Governmental Consents. The execution, delivery and performance
by the SunSource Entities of this Agreement and the Note and the transactions
contemplated hereby and thereby do not and will not require any consent,
approval, authorization, satisfaction or other order of, review or action by,
filing with or notification to any Governmental Authority.

                  Section 2.6       No Other Agreements to Purchase. No Person (other than the
Partnership hereunder or the Class A Holder (as defined in the Partnership
Agreement)) has any written or oral agreement or option or any right or
privilege whatsoever, whether by law, pre-emptive or contractual, capable of
becoming an agreement or option for the purchase or acquisition from SunSub of
any of the SunSub Units.

                  Section 2.7       Brokers and Finders. No investment banker, broker or finder
which has been retained by or is authorized to act on behalf of the SunSource
Entities, is entitled to any fee or commission from either of the SunSource
Entities, in connection with the transactions contemplated by this Agreement.

                  Section 2.8       Litigation. There are no Proceedings pending or, to the
knowledge of the SunSource Entities, threatened against either of the SunSource
Entities affecting the SunSub Units or which could conflict with or limit the
SunSource Entities’ ability to perform their obligations under this Agreement.

                  Section 2.9       Release of Claims. The SunSource Entities have not currently
assigned or transferred any interest in any of the Claims to be released by
Section 4.1 hereof and the SunSource Entities will not in the future, assign or
transfer any interest in any such released Claims. The SunSource Entities
acknowledge that they have been given the opportunity to review all information
and documents with respect to the Claims to be released by
Section 4.1 hereof
prior to entering into this Agreement. The SunSource Entities further
acknowledge that they have made an independent investigation in making their
decision to agree to the release set forth in Section 4.1 hereof. The
SunSource Entities are not relying on any statements or representations by the
Partnership or any Partnership Releasee in agreeing to the release set forth in
Section 4.1 hereof.

ARTICLE III.

REPRESENTATIONS AND WARRANTIES OF THE PARTNERSHIP

                  The Partnership hereby represents and warrants to the SunSource Entities
that the statements contained in this Article III are correct and complete as
of the date of this Agreement and will be correct and complete as of the
Closing Date (as though made at such time and as though the Closing Date were
substituted for the date of this Agreement throughout this
Article III).

                  Section 3.1       Organization. The Partnership is duly formed, validly
existing and in good standing under the laws of the State of Delaware.

                  Section 3.2       Authority. The Partnership has all requisite partnership power
and authority, and prior to Closing will have taken all partnership actions
necessary, to execute and

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deliver this Agreement and the Note, to consummate
the transactions contemplated by this Agreement and the Note and to perform its
obligations hereunder and thereunder. The execution and delivery by the
Partnership of this Agreement and the Note and the consummation by the
Partnership of the transactions contemplated hereby and thereby have been duly
approved by all necessary partnership action on the part of the Partnership.
No other proceedings on the part of the Partnership are necessary to authorize
the execution and delivery of this Agreement and the Note and the consummation
of the transactions contemplated hereby and thereby.

                  Section 3.3       Enforceability. This Agreement and the Note have been duly
executed and delivered by the Partnership and constitute legal, valid and
binding obligations of the Partnership, enforceable against the Partnership in
accordance with its terms, subject to the effects of bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium and other similar Laws
relating to or affecting creditors’ rights generally and general equitable
principles (whether considered in a proceeding in equity or at law).

                  Section 3.4       No Conflict or Violation. Except for consents or waivers that
may be required under the Credit Documents and set forth on Schedule 3.4
hereto, the execution, delivery and performance by the Partnership of this
Agreement and the Note and the consummation of the transactions contemplated
hereby and thereby and the compliance by the Partnership with any of the
provisions hereof and thereof, do not and will not (a) violate, conflict with
or result in the breach of any provision of the Partnership Agreement or any
other organizational documents of the Partnership, (b) conflict with or violate
any Law or Governmental Order applicable to the Partnership or any of its
assets or properties, or (c) conflict with, result in any breach of, constitute
a default (or event which with the giving of notice or lapse of time, or both,
would become a default) under, require any consent under, or give to others any
rights of termination, amendment or acceleration of, or result in the creation
of any Lien on any of the assets or properties of the Partnership pursuant to,
any Contract to which the Partnership is a party or by which any of its assets
or properties is bound or affected.

                  Section 3.5       Governmental Consents. The execution, delivery and
performance by the Partnership of this Agreement and the Note and the
transactions contemplated hereby do not and will not require any consent,
approval, authorization, satisfaction or other order of, review or action by,
filing with or notification to any Governmental Authority.

                  Section 3.6       Brokers. No investment banker, broker or finder which has
been retained by or is authorized to act on behalf of the Partnership, is
entitled to any fee or commission from the Partnership in connection with the
transactions contemplated by this Agreement.

                  Section 3.7       Litigation. There are no Proceedings pending or, to the
knowledge of the Partnership, threatened against the Partnership which could
conflict with or limit the Partnership’s ability to perform its obligations
under this Agreement.

                  Section 3.8       Release of Claims. The Partnership has not currently assigned
or transferred any interest in any of the Claims to be released by Section 4.2
hereof and the Partnership will not in the future, assign or transfer any
interest in any such released Claims.

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The Partnership acknowledges that it has
been given the opportunity to review all information and documents with respect
to the Claims to be released by Section 4.2 hereof prior to entering into this
Agreement. The Partnership further acknowledges that it has made an
independent investigation in making its decision to agree to the release set
forth in Section 4.2 hereof. The Partnership is not relying on any statements
or representations by the SunSource Entities or any SunSource Releasee in
agreeing to the release set forth in Section 4.2 hereof.

                  Section 3.9       Financial Statements. The Partnership has previously provided
to SunSource a true and complete copy of the unaudited consolidated and
consolidating financial statements pertaining to the fiscal year ended December
31, 2001 (the “Unaudited Financials”). The Unaudited Financials were prepared
in accordance with GAAP, are true and correct in all material respects and
fairly present the operating income and financial condition of the Partnership
and each of its subsidiaries at such date and for the period then ended.

ARTICLE IV.

ADDITIONAL AGREEMENTS

                  Section 4.1       Release of Claims by SunSource Releasors.

                  (a)       Waiver. Upon Closing, the SunSource Entities shall, for themselves
and on behalf of the SunSource Releasors (as herein defined), hereby waive and
release any rights to initiate or prosecute or participate in the initiating or
prosecuting of any Claims (hereinafter defined) against or with respect to the
Partnership, or any Releasee (hereinafter defined), arising out of, concerning
in any way or resulting from (i) the repurchase of the SunSub Units affected by
this Agreement or (ii) the Partnership Agreement (other than the right to
receive accrued but unpaid tax distributions through the date hereof as
provided in Section 4.1 of the Partnership Agreement), in each case whether any
such Claims are existing as of, or at anytime prior to, Closing or arising
anytime thereafter; provided, however, such waiver and release shall not in any
way limit the SunSource Entities’ rights under this Agreement or the Note or
the SunSource Indemnified Parties’ ability to seek indemnity under Article VI
of this Agreement.

                  (b)       Release. Upon Closing, the SunSource Entities shall, for themselves
and on behalf of the SunSource Releasors, hereby release and forever discharge
the Partnership and all Partnership Releasees (hereinafter defined) of and from
any and all manner of Claims which the SunSource Releasors have or may have as
of, or at any time prior to, Closing or may anytime thereafter have against any
Releasee (hereinafter defined) arising out of, concerning in any way or
resulting from the (i) the repurchase of the SunSub Units affected by this
Agreement or (ii) the Partnership Agreement (other than the right to receive
accrued but unpaid tax distributions through the date hereof as provided in
Section 4.1 of the Partnership Agreement), in each case whether any such Claims
are existing as of or at any time prior to Closing or arising anytime
thereafter; provided, however, such release and discharge shall not in any way
limit the SunSource Entities’ rights under this Agreement or the Note or the
SunSource Indemnified Parties’ ability to seek indemnity under Article VI
hereunder.

                  (c)       Claims. “Claims” shall mean any action or actions, cause or causes of
action, in law or in equity, suits, debts, liens, liabilities, claims, demands,
damages, punitive damages, losses, costs or expenses, and reasonable attorneys’
fees of any nature whatsoever,

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including, without limitation, claims based upon
breach of fiduciary or other duty, legal fault, misrepresentation or omission,
negligence, offense, quasi-offense, contract, quasi-contract or any other
theory, or for actions taken or omitted to be taken in regard to the (i) the
repurchase of the SunSub Units affected by this Agreement or (ii) the
Partnership Agreement (other than the right to receive accrued but unpaid tax
distributions through the date hereof as provided in Section 4.1 of the
Partnership Agreement), in each case whether fixed or contingent, including
knowing, suspected or Unknown Claims (hereinafter defined).

                  (d)       SunSource Releasors. “SunSource Releasor” or “SunSource Releasors”
shall mean any or all of the SunSource Entities, and any corporation,
partnership, joint venture, or business enterprise controlled by, under common
control with or controlling such companies, each of the officers, directors,
corporate representatives of such companies, and all direct or indirect
subsidiaries of such entities, and each of the parents, subsidiaries, equity
holders, officers, directors, corporate representatives, employees, agents,
advisors, lawyers or accountants thereof.

                  (e)       Partnership Releasees. “Partnership Releasee” or “Partnership
Releasees” shall mean any or all of Partnership, GC-SUN, Inc. and any
corporation, partnership, joint venture, or business enterprise controlled by,
under common control with or controlling such
companies, each of the officers, directors, corporate representatives of
such companies, and all direct or indirect subsidiaries of such entities, and
each of the parents, subsidiaries, equity holders, officers, directors,
corporate representatives, employees, agents, advisors, lawyers or accountants
thereof.

                  (f)       Unknown Claims Generally. For the purposes of this Section 4.1,
“Unknown Claims” means any and all Claims including, without limitation, any
Claim the SunSource Releasors’ do not know or do not suspect to exist in their
favor at the time of the giving of the release which, if known by them might
have affected their decision regarding the releases. The SunSource Entities,
for themselves and on behalf of the SunSource Releasors, hereby acknowledge
that the Releasors might after Closing discover facts in addition to or
different from those which they knew at Closing or believed to be true with
respect to the subject matter of the Claims released by this Section 4.1, but
nonetheless the SunSource Releasors’ shall be deemed to have fully, finally and
forever settled and released any and all Claims arising out of, concerning in
any way or resulting from (i) the repurchase of the SunSub Units affected by
this Agreement or (ii) the Partnership Agreement (other than the right to
receive accrued but unpaid tax distributions through the date hereof as
provided in Section 4.1 of the Partnership Agreement), in each case whether any
such Claims are known or unknown, suspected or unsuspected, contingent or
non-contingent, which existed at or prior to Closing or may come to exist in
the future upon any theory of law or equity now existing or coming into
existence in the future.

                  (g)       Scope of Release. The release provided for in this Section 4.1 is
intended by the SunSource Entities, for themselves and on behalf of the
SunSource Releasors, to be as broad as the law allows and is intended
specifically to be a compromise and release generally of all released Claims of
the SunSource Releasors against all Partnership Releasees arising out of,
concerning in any way or resulting from (i) the repurchase of the SunSub Units
affected by this Agreement or (ii) the Partnership Agreement (other than the
right to receive accrued but unpaid

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tax distributions through the date hereof
as provided in Section 4.1 of the Partnership Agreement), in each case whether
any such Claims are existing as of or at anytime prior to Closing or arising
anytime thereafter; provided, however, such release and compromise shall not in
any way limit the SunSource Entities’ rights under this Agreement or the Note
or the SunSource Indemnified Parties’ ability to seek indemnity under Article
VI hereunder.

                  (h)       Waiver. The SunSource Entities, for themselves and the SunSource
Releasors, hereby specifically waive any purported right to challenge the
validity or seek rescission of, or to vitiate, this release provided under this
Section 4.1 of the Agreement on the ground that any information was kept
concealed from the SunSource Releasors by any of the Partnership Releasees, and
agree, on behalf of themselves and the SunSource Releases, that no remedy shall
be available for any such alleged non-disclosure, and that the right to rescind
this release on any such grounds is hereby expressly waived.

                  (i)       Indemnification. From and after the Closing, SunSource shall
indemnify, save and hold harmless the Partnership Releasees’ from and against
any and all Damages in connection with, arising out of, resulting from or
incident to any Claims waived and released by the SunSource Releasors pursuant
to this Section 4.1 of the Agreement.

                  (j)       No Admission of Wrongdoing. Nothing in this Section 4.1 shall be
construed as an admission of liability, fault or wrongdoing on the part of any
Partnership Releasee.

                  Section 4.2       Release of Claims by Partnership Releasors.

                  (a)       Waiver. Upon Closing, the Partnership shall, for itself and on behalf
of the Partnership Releasors (as herein defined), hereby waive and release any
rights to initiate or prosecute or participate in the initiating or prosecuting
of any Claims (hereinafter defined) against or with respect to the SunSource
Entities, or any SunSource Releasee (hereinafter defined), arising out of,
concerning in any way or resulting from (i) the repurchase of the SunSub Units
affected by this Agreement or (ii) the Partnership Agreement, in each case
whether any such Claims are existing as of, or at any time prior to Closing or
arising anytime thereafter; provided, however, such waiver and release shall
not in any way limit the Partnership’s rights under this Agreement, the Note or
the Partnership Indemnified Parties’ ability to seek indemnity under Article VI
of this Agreement.

                  (b)       Release. Upon Closing, the Partnership shall, for itself and on
behalf of the Partnership Releasors, hereby release and forever discharge the
SunSource Entities and all SunSource Releasees (hereinafter defined) of and
from any and all manner of Claims which the Partnership Releasors have or may
have as of, or at any time prior to, Closing or may anytime thereafter have
against any SunSource Releasee (hereinafter defined) arising out of, concerning
in any way or resulting from the (i) the repurchase of the SunSub Units
affected by this Agreement or (ii) the Partnership Agreement, in each case
whether any such Claims are existing as of or at anytime prior to Closing or
arising anytime thereafter; provided, however, such release and discharge shall
not in any way limit the Partnership’s rights under this Agreement, the Note or
the Partnership Indemnified Parties’ ability to seek indemnity under Article VI
hereunder.

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                  (c)       Claims. “Claims” shall mean any action or actions, cause or causes of
action, in law or in equity, suits, debts, liens, liabilities, claims, demands,
damages, punitive damages, losses, costs or expenses, and reasonable attorneys’
fees of any nature whatsoever, including, without limitation, claims based upon
breach of fiduciary or other duty, legal fault, misrepresentation or omission,
negligence, offense, quasi-offense, contract, quasi-contract or any other
theory, or for actions taken or omitted to be taken in regard to the (i) the
repurchase of the SunSub Units affected by this Agreement or (ii) the
Partnership Agreement, in each case whether fixed or contingent, including
knowing, suspected or Unknown Claims (hereinafter defined).

                  (d)       Partnership Releasors. “Partnership Releasor” or “Partnership
Releasors” shall mean any or all of the Partnership, and any corporation,
partnership, joint venture, or business enterprise controlled by, under common
control with or controlling such companies, each of the officers, directors,
corporate representatives of such companies, and all direct or indirect
subsidiaries of such entities, and each of the parents, subsidiaries, equity
holders, officers, directors, corporate representatives, employees, agents,
advisors, lawyers or accountants thereof.

                  (e)       SunSource Releasees. “SunSource Releasee” or “SunSource Releasees”
shall mean any or all of the SunSource Entities and any corporation,
partnership, joint venture, or business enterprise controlled by, under common
control with or controlling such companies, each of the officers, directors,
corporate representatives of such companies, and all direct or indirect
subsidiaries of such entities, and each of the parents, subsidiaries, equity
holders, officers, directors, corporate representatives, employees, agents,
advisors, lawyers or accountants thereof.

                  (f)       Unknown Claims Generally. For the purposes of this Section 4.2,
“Unknown Claims” means any and all Claims including, without limitation, any
Claim the Partnership Releasors’ do not know or do not suspect to exist in
their favor at the time of the giving of the release which, if known by him
might have affected his decision regarding the releases. The Partnership, for
itself and on behalf of the Partnership Releasors, hereby acknowledges that the
Partnership Releasors might after Closing discover facts in addition to or
different from those which they knew at Closing or believed to be true with
respect to the subject matter of the Claims released by this Section 4.2, but
nonetheless the Partnership Releasors’ shall be deemed to have fully, finally
and forever settled and released any and all Claims arising out of, concerning
in any way or resulting from (i) the repurchase of the SunSub Units affected by
this Agreement or (ii) the Partnership Agreement, in each case whether any such
Claims are known or unknown, suspected or unsuspected, contingent or
non-contingent, which existed at or prior to Closing or may come to exist in
the future upon any theory of law or equity now existing or coming into
existence in the future.

                  (g)       Scope
of Release. The release provided for in this Section 4.2 is
intended by the Partnership, for itself and on behalf of the SunSource
Releasors, to be as broad as the law allows and is intended specifically to be
a compromise and release generally of all released Claims of the Partnership
Releasors against all SunSource Releasees arising out of, concerning in any way
or resulting from (i) the repurchase of the SunSub Units affected by this
Agreement or (ii) the Partnership Agreement, in each case whether any such
Claims are existing as of or at anytime prior to Closing or arising anytime
thereafter; provided, however, such release and

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compromise shall not in any way
limit the Partnership’s rights under this Agreement, the Note or the
Partnership Indemnified Parties’ ability to seek indemnity under
Article VI
hereunder.

                  (h)       Waiver. The Partnership, for itself and on behalf of the Partnership
Releasors, hereby specifically waives any purported right to challenge the
validity or seek rescission of, or to vitiate, this release provided
under this Section 4.2 of the Agreement on the ground that any information was kept
concealed from the Partnership Releasors by any of the SunSource Releasees, and
agrees on behalf of itself and the Partnership Releases that no remedy shall be
available for any such alleged non-disclosure, and that the right to rescind
this Release on any such grounds is hereby expressly waived.

                  (i)       Indemnification. From and after the Closing, the Partnership shall
indemnify, save and hold harmless the SunSource Releasees’ from and against any
and all Damages in connection with, arising out of, resulting from or incident
to any Claims waived and released by the Partnership Releasors pursuant to this
Section 4.2 of the Agreement.

                  (j)       No Admission of Wrongdoing. Nothing in this Section 4.2 shall be
construed as an admission of liability, fault or wrongdoing on the part of any
SunSource Releasee.

                  (k)       Tax Allocations. Notwithstanding anything set forth in this Section
4.2, for all income and other tax purposes, SunSub shall be and shall be
treated as a partner of the Partnership through the Closing Date and the
Partnership shall be entitled to make with respect to SunSub all appropriate
allocations of income, losses and other items, as provided in Article V of the
Partnership Agreement with respect to all periods prior to the Closing Date.

                  Section 4.3       Partnership Reporting. Notwithstanding anything to the
contrary contained herein, from time to time until the Closing Date, the
Partnership shall provide to SunSource all reports and other information
required to be provided under the Partnership Agreement to Partners under the
Partnership Agreement, in connection with SunSub’s ownership of the SunSub
Units through the Closing Date.

                  Section 4.4       Further Assurances. The parties hereto agree (a) to use all
commercially reasonable efforts to take, or cause to be taken, all actions and
to do, or cause to be done, all things necessary, proper or advisable to
consummate and make effective the transactions contemplated by this Agreement,
including, all actions necessary to satisfy the conditions to Closing set forth
in Article V hereof, (b) to execute any documents, instruments or conveyances
of any kind which may be reasonably necessary or advisable to carryout the
transactions contemplated by this Agreement and (c) to cooperate with each
other in connection with the foregoing.

                  Section 4.5       Call Right. If the transactions contemplated by this
Agreement are not consummated and the Closing does not occur because of a
failure to satisfy any of the conditions set forth in Section 5.2 hereof (other
than Section 5.2(e)), the Partnership shall be deemed to have not exercised its
call rights pursuant to Section 9.5 and 9.6 of the Partnership Agreement (the
“Call Rights”) and the Partnership shall retain its right to exercise such Call

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Rights with respect to the SunSub Units at any time in the future, in
accordance with the terms of the Partnership Agreement.

ARTICLE V.

CONDITIONS TO CLOSING

                  Section 5.1       Conditions to Obligations of the SunSource Entities. The
obligations of the SunSource Entities to consummate the transactions
contemplated by this Agreement shall be subject to the satisfaction (or waiver
by the SunSource Entities), at or prior to the Closing, of each of the
following conditions:

                  (a)       Representations and Warranties. All representations and warranties of the Partnership contained in this
Agreement that are qualified by materiality shall be true and correct as of the
date hereof and as of the Closing Date as if made on the Closing Date, and all
representations and warranties of the Partnership contained in this Agreement
that are not so qualified shall be true and correct in all material respects as
of the date hereof and as of the Closing Date as if made as of the Closing
Date.

                  (b)       Performance of Agreements and Covenants. The Partnership shall have
duly performed and complied with in all material respects all of its agreements
and covenants pursuant to this Agreement on or prior to the Closing Date.

                  (c)       No Order. No order, statute, regulation, executive order, injunction,
stay, decree, directive or restraining order shall have been enacted, entered,
promulgated or enforced by any court or quasi-judicial or administrative agency
of any federal, state, or local jurisdiction that would (i) prevent
consummation of any of the transactions contemplated by this Agreement or (ii)
cause any of the transactions contemplated by this Agreement to be rescinded
following consummation thereof.

                  (d)       Consents; Regulatory Compliance and Approval. All consents, approvals
and waivers from, registrations and filings with and notices to Governmental
Authorities necessary to permit the consummation of the transactions
contemplated by this Agreement shall have been obtained, unless the failure to
obtain any such consent, approval or waiver or make such registration or filing
or give such notice could not reasonably be expected have a material adverse
effect on the ability of the Partnership to perform its obligations under this
Agreement.

                  (e)       Officer’s Certificates. The Partnership shall have delivered to
SunSource a certificate signed by a duly authorized officer of the Partnership
to the effect that each of the conditions specified in Sections 5.1(a) and (b)
of this Agreement is satisfied in all respects.

                  (f)       Note. The Partnership shall have executed and delivered the Note.

                  (g)       Opinion of Counsel. The Partnership shall have delivered to SunSource
an opinion of their counsel, Latham & Watkins, dated as of the Closing Date,
substantially in the form of Exhibit B hereto.

11

 

                  (h)       Consents. SunSource shall have obtained the consents required to
consummate the transactions contemplated hereby, which consents are set forth
on Schedule 5.1(h) hereto.

                  (i)       Financing Documents. SunSource shall have received copies of the
Securities Purchase Agreement and the Senior Credit Agreement.

                  (j)       Refund. SunSource shall have received $25,000 in immediately
available funds from the Partnership relating to the reimbursement of payments
made by SunSource to Houlihan Lokey Howard & Zukin.

                  (k)       General Partner Certificate. SunSource shall have received from the
Partnership, (i) certified as of a recent date by the Secretary of State of the
State of Delaware, a certificate as to the good standing of the Partnership as
of a recent date, from such Secretary of State and (ii) a certificate of the
General Partner dated as of the Closing Date and certifying (A) that attached
thereto is a true and complete copy of the Partnership Agreement as in effect
on the Closing Date and at all times since a date prior to the date of the
resolutions described in clause (B) below, (B) that attached thereto is a true
and complete copy of resolutions duly adopted by the General Partner
authorizing the execution, delivery and performance of the Note and this
Agreement and that such resolutions have not been modified, rescinded or
amended and are in full force and effect, (C) that the Partnership Agreement
has not been amended since the date of the last amendment thereto shown on the
certificate of good standing furnished pursuant to clause (i) above, and (D) as
to the incumbency and specimen signature of each Person executing this
Agreement, the Note or any other document delivered in connection herewith on
behalf of the Partnership.

                  Section 5.2       Conditions to Obligations of the Partnership. The obligations
of the Partnership to consummate the transactions contemplated by this
Agreement shall be subject to the satisfaction (or waiver by the Partnership in
writing), at or prior to the Closing, of each of the following conditions:

                  (a)       Representations and Warranties. All representations and warranties of
SunSource contained in this Agreement that are qualified by materiality shall
be true and correct as of the date hereof and as of the Closing Date as if made
on the Closing Date, and all representations and warranties of SunSource
contained in this Agreement that are not so qualified shall be true and correct
in all material respects as of the date hereof and as of the Closing Date as if
made as of the Closing Date.

                  (b)       Performance of Agreements and Covenants. The SunSource Entities shall
have duly performed and complied with in all material respects all of their
respective agreements and covenants pursuant to this Agreement on or prior to
the Closing Date.

                  (c)       No Order. No Action shall be pending or threatened before any court
or quasi-judicial or administrative agency of any federal, state, local, or
foreign jurisdiction or before any arbitrator wherein an unfavorable
injunction, judgment, order, decree, ruling, or charge would (i) prevent
consummation of any of the transactions contemplated by this Agreement,
(ii) cause any of the transactions contemplated by this Agreement to be
rescinded

12

 

following consummation, or (iii) affect adversely the right of the
Partnership to own the SunSub Units.

                  (d)       Consents; Regulatory Compliance and Approval. All consents, approvals
and waivers from, registrations and filings with and notices to Governmental
Authorities necessary to permit the consummation of the transactions
contemplated by this Agreement shall have been obtained, unless the failure to
obtain any such consent, approval or waiver or make such registration or filing
or give such notice could not reasonably be expected to have a material adverse
effect on the ability of the SunSource Entities to perform their obligations
under this Agreement.

                  (e)       Bank Consents, Amendments or Waivers. The Partnership shall have
received all required amendments, approvals, waivers, or consents with respect
to the Credit Documents necessary for the Partnership consummate the
transactions contemplated hereby, including the issuance of the Note and
repurchase of the SunSub Units.

                  (f)       Officer’s Certificates. Each of the SunSource Entities shall have
delivered to the Partnership a certificate signed by an appropriate officer
thereof to the effect that each of the conditions specified in Sections 5.2(a)
and (b) of this Agreement have been satisfied in all respects.

                  (g)       Opinion of Counsel. The Partnership shall have delivered to SunSource
an opinion of their counsel, Piper Marbury Rudnick & Wolfe LLP dated as of the
Closing Date, substantially in the form of Exhibit C hereto.

                  (h)       Secretary’s Certificate. The Partnership shall have received from
each of the SunSource Entities, (i) certified as of a recent date by the
Secretary of State of the State of Delaware, a certificate as to the good
standing of each of the SunSource Entities as of a recent date, from such
Secretary of State and (ii) a certificate of the Secretary of each of the
SunSource Entities dated as of the Closing Date and certifying (A) that
attached thereto is a true and complete copy of each such entities’
Organizational Documents as in effect on the Closing Date and at all times
since a date prior to the date of the resolutions described in clause (B)
below, (B) that attached thereto is a true and complete copy of resolutions
duly adopted by the board of directors or other governing body of each of the
SunSource Entities authorizing the execution, delivery and performance of the
Note and this Agreement and that each such resolutions have not been modified,
rescinded or amended and are in full force and effect, (C) that the
Organizational Documents for each of the SunSource Entities has not been
amended since the date of the last amendment thereto shown on the certificate
of good standing furnished pursuant to clause (i) above, and (D) as to the
incumbency and specimen signature of each Person executing this Agreement, the
Note or any other document delivered in connection herewith on behalf of each
of the SunSource Entities.

                  (i)       Pledges or Liens. The Partnership shall have received releases in
form and substance satisfactory to the Partnership, effective to release all
Liens in favor of PNC Bank, National Association or any other Persons on or
relating to the SunSub Units.

13

 

ARTICLE VI.

INDEMNIFICATION

                  Section 6.1       Survival of Representations, Etc. All of the representations,
warranties, covenants and agreements of the parties contained in this Agreement
or any other certificate, instrument or document delivered pursuant hereto
shall survive the Closing; provided, however, that (a) except as provided in
subsections (b) below, the representations and warranties contained in this
Agreement shall survive for a period of eighteen (18) months following the
Closing and (b) the representations and warranties contained in Sections 2.1
(Ownership of SunSub Units), 2.2 (Organization), 2.3 (Authority;
Enforceability), 3.1 (Organization), 3.2 (Authority) and 3.3 (Enforceability)
of this Agreement shall survive in perpetuity with respect to the matters
addressed in such sections. The termination of the representations, warranties
or indemnities provided in this Section 6.1 shall not affect the rights of any
party hereto in respect of any claim with respect to which notice has been
given under this Article VI prior to the expiration of the applicable survival
period provided in this Section 6.1.

                  Section 6.2       Indemnification

                  (a)       Indemnification by SunSource. From and after the Closing, SunSource
shall indemnify, save and hold harmless the Partnership and its Affiliates and
their respective Representatives (collectively, the “Partnership Indemnified
Parties”) from and against any and all Damages in connection with, arising out
of, resulting from or incident to:

	 	 	                     (i)       any
misrepresentation or breach of warranty in connection with
any of the representations or warranties given or made by SunSource in
this Agreement or any other agreement, certificate, instrument or other
document executed and delivered by any of the SunSource Entities pursuant
hereto (without regard to any qualification thereof as to materiality);
	 
	 	 	                     (ii)       any
breach of any covenant or agreement by the SunSource
Entities contained in this Agreement or any other agreement,
certificate, instrument or other document executed and delivered by the
SunSource Entities pursuant hereto (without regard to any qualification
thereof as to materiality);

                  (b)       Indemnification by the Partnership. From and after the Closing, the
Partnership shall indemnify, save and hold harmless the SunSource and its
Affiliates and their respective Representatives (the “SunSource Indemnified
Parties”) from and against and all Damages arising out of, resulting from or
incident to:

	 	 	                     (i)       any
misrepresentation or breach of warranty in connection with
any of the representations or warranties given or made by the Partnership
in this Agreement or any other agreement, certificate, instrument or
other document executed and delivered by the Partnership pursuant hereto;
	 
	 	 	                     (ii)       any
breach of any covenant or agreement by the Partnership
contained in this Agreement or any other agreement, certificate,
instrument or other document executed and delivered by the Partnership
pursuant hereto;

14

 

                  (c)       Notice of Claims; Defense of Claims. Any party hereto seeking
indemnification under this Article VI (the “Indemnified Party”) shall give the
party from whom indemnification is being sought (the “Indemnifying Party”)
notice of any claim, Action or matter which such Indemnified Party has
determined has given or could give rise to Damages for which indemnification
may be sought under this Section 6.2 or would otherwise give rise to a right of
indemnification under this Agreement (a “Claim”), as soon as practicable after
the party hereto seeking indemnification becomes aware of such Claim; provided,
however, that the failure to provide such notice shall not relieve the
Indemnifying Party from any of its obligations under this Section 6.2 except to
the extent the Indemnifying Party is materially prejudiced by such failure.
Upon receipt of such notice, the Indemnifying Party shall be entitled at its
cost, risk and expense to assume and control the defense and investigation of
such Claim, and to employ and engage counsel of its choice, if the Indemnifying
Party gives notice of its intention to do so to the Indemnified Party within
thirty (30) days of the receipt of such notice; provided, however, that if
there exists a material conflict of interest (other than one that is of a
monetary nature) or if the Indemnified Party has been advised by counsel that
there may be one or more legal defenses available to it that are different from
or additional to those available to the Indemnifying Party, which, in either
case, would make it inappropriate for the same counsel to represent both the
Indemnified Party and the Indemnifying Party, then the Indemnified Party shall
be entitled to retain its own counsel, at the expense of the Indemnifying Party
(but the Indemnifying Party shall not be obligated to pay the reasonable fees
and expenses of more than one separate counsel for all Indemnified Parties,
taken together). In the event the Indemnifying Party exercises the right to
undertake any such defense against any such Claim as provided in this Section
6.2(c), (i) the Indemnified Party may, at its own cost, participate in the
investigation, trial and defense of such Claim and any appeal arising
therefrom, and (ii) the Indemnified Party agrees to cooperate with the
Indemnifying Party in such defense and make available to the Indemnifying
Party, all witnesses, records, materials and information in the Indemnified
Party’s possession or under the Indemnified Party’s control relating thereto as
may be reasonably required by the Indemnifying Party. In the event the
Indemnifying Party fails to assume the defense of such Claim within thirty (30)
days after receipt of notice thereof, (i) the Indemnified Party against which
such Claim has been asserted shall have the right to undertake the defense,
compromise or settlement of such Claim on behalf of, at the expense of and for
the account and risk of the Indemnifying Party, and (ii) the Indemnifying Party
agrees to cooperate with the Indemnified Party in such defense and make
available to the Indemnified Party, all witnesses, records, materials and
information in the Indemnifying Party’s possession or under the Indemnifying
Party’s control relating thereto as may be reasonably required by the
Indemnified Party.

                  (d)       Settlement of Claims. The Indemnifying Party shall not, without the
written consent of the Indemnified Party (which consent shall not be
unreasonably withheld), (i) settle or compromise any Claim or consent to the
entry of any judgment which does not include as an unconditional term thereof
the delivery by the claimant or plaintiff to the Indemnified Party of a written
release from all liability in respect of such Claim of all Indemnified Parties
affected by such Claim or (ii) settle or compromise any Claim if the settlement
imposes equitable remedies or material obligations on the Indemnified Party
other than financial obligations for which such Indemnified Party will be
indemnified hereunder. No Claim which is being defended in good faith by the
Indemnifying Party in accordance with the terms of this Agreement shall be
settled or compromised by the Indemnified Party without the written consent of
the Indemnifying Party (which consent shall not be unreasonably withheld).

15

 

                  (e)       Reduction of Damages. To the extent any Damages of an Indemnified
Party are reduced by receipt of payment (i) under insurance policies which are
not subject to retroactive adjustment or other reimbursement to the insurer in
respect of such payment, or (ii) from third parties not affiliated with the
Indemnified Party, such payments (net of the expenses of the recovery thereof)
(such net payment, a “Reimbursement”) shall be credited against any such
Damages; provided, however, (x) the pendency of such payments shall not delay
or reduce the obligation of the Indemnifying Party to make payment to the
Indemnified Party in respect of such Damages, and (y) the Indemnified Party
shall have no obligation, hereunder or otherwise, to pursue payment under or
from any insurer or third party in respect of such Damages. If any
Reimbursement is obtained subsequent to payment by an Indemnifying Party in
respect of any Damages, such Reimbursement shall be promptly paid over to the
Indemnifying Party.

                  Section 6.3       Partnership’s Right of Set-Off.

                  (a)       Notwithstanding anything to the contrary in this Agreement, and
regardless of other means of obtaining payment, at any time and from time to
time any Partnership Indemnified Party delivers a notice (“Judgment Notice”) to
SunSource regarding any Claim for which the Partnership Indemnified Party is or
may be entitled to indemnification from SunSource under this Article IX and
which Claim has been reduced to a judgment in favor of such Partnership
Indemnified Party by a Governmental Authority of competent jurisdiction (a
“Judgement”), the Partnership is hereby authorized to withhold and set-off and
apply against any amounts owing or that may be owed to any of the SunSource
Entities by the Partnership under (i) this Agreement and (ii) the Note (as to
the extent provided in such Note), up to such amounts as set forth in each such
Judgement Notice. The rights of the Partnership under this Section 6.3(a)
shall include, without limitation, the right to withhold and retain any payment
due under the Note in accordance with the terms of the Note.

                  (b)       Notwithstanding anything in this Agreement to the contrary (and
without limiting the generality of Section 9.12), (i) the rights to set-off
provided in the Note or otherwise pursuant to this Section 6.3 and (ii) any
other rights and remedies under this Agreement or in equity or at law that any
Partnership Indemnified Party may have with respect to the satisfaction of the
indemnification obligations of SunSource under this Agreement shall be
cumulative, and the exercise of any such right by any Person shall not be
exclusive of any other right or remedy
and shall not limit, modify, adversely affect, prejudice or impair the
exercise (or ability to exercise) any such rights or remedies.

ARTICLE VII.

TERMINATION

                  Section 7.1       Termination. This Agreement may be terminated at any time
prior to the Closing:

                  (a)       by the mutual written consent of SunSource and the Partnership;

                  (b)       by SunSource upon written notice in the event of a material breach of
any representation or warranty of the Partnership contained in this Agreement
or any covenant or agreement to be performed or complied with by the
Partnership pursuant to the terms of this

16

 

                  Agreement, which breach (i) has
continued without cure for a period of ten (10) days following notice thereof
by SunSource to the Partnership and (ii) would result in a condition to Closing
set forth in Section 5.1 of this Agreement not being satisfied (which condition
has not been waived by SunSource in writing); or

                  (c)       by the Partnership upon written notice in the event of a material
breach of any representation or warranty of SunSource contained in this
Agreement or any covenant or agreement to be performed or complied with by the
SunSource Entities pursuant to the terms of this Agreement, which breach (i)
has continued without cure for a period of ten (10) days following notice
thereof by the Partnership to SunSource and (ii) would result in a condition to
Closing set forth in Section 5.2 of this Agreement not being satisfied (which
condition has not been waived by the Partnership in writing).

                  Section 7.2       Effect of Termination. In the event of any termination of
this Agreement in accordance with Section 7.1 of this Agreement, this Agreement
shall forthwith become void and of no further force or effect and there shall
be no liability on the part of any party hereto to any other Party, except that
nothing herein shall relieve any party hereto from liability for any willful
breach of this Agreement occurring prior to any such termination.

ARTICLE VIII.

DEFINITIONS

                  Section 8.1       Certain Defined Terms. As used in this Agreement, the
following terms shall have the following meanings. Any of such terms, unless
the context otherwise requires, may be used in the singular or the plural.

                  “Action” shall mean any claim, action, cause of action, suit, order, writ,
litigation, labor dispute, injunction, judgment, decree, criminal prosecution,
arbitration, inquiry, proceeding or investigation by or before any Governmental
Authority or arbitral body.

                  “Affiliate” shall mean, with respect to any specified Person, any other
Person that directly, or indirectly through one or more intermediaries,
controls, is controlled by, or is under common control with, such specified
Person.

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

                  “Class B Unit” shall have the meaning set forth in the Partnership
Agreement.

                  “Class F Unit” shall have the meaning set forth in the Partnership
Agreement.

                  “Contract” shall mean agreements, contracts, leases, licenses, notes,
loans, evidence of indebtedness, purchase orders, bonds, mortgages, indentures,
letters of credit, settlement agreements, franchise agreements, undertakings,
covenants not to compete, employment agreements, licenses, instruments,
obligations, commitments, understandings, purchase and sales orders, and other
executory commitments to which any person is a party or to which any of the
assets of the any person is subject, whether oral or written, express or
implied.

17

 

                  “Credit Documents” shall mean the Senior Credit Agreement, all other Loan
Documents (under and as defined in the Senior Credit Agreement), and the Note
Documents.

                  “Damages” shall mean any and all costs, losses (including, without
limitation, diminution in value), taxes, Liabilities, obligations, damages
(including special damages), lawsuits, deficiencies, claims, demands, and
expenses (whether or not arising out of a Claim), including, without
limitation, reasonable attorneys’ fees, interest, penalties, costs of
mitigation, lost profits and all amounts paid in investigation, defense or
settlement of any of the foregoing. As used in this Agreement, Damages shall
not be limited to matters asserted by third parties against an Indemnified
Party, but shall include Damages incurred or sustained by an Indemnified Party
in the absence of third party claims.

                  “Governmental Authority” shall mean any federal, state, or local or any
governmental, regulatory or administrative authority, agency or commission or
any court, tribunal or judicial body.

                  “Governmental Order” shall mean any order, writ, injunction, decree,
stipulation, determination or award entered by or with any Governmental
Authority.

                  “Law” shall mean any statute, law, by-law, ordinance, regulation or rule,
code or policy of any Governmental Authority.

                  “Liabilities” shall mean any and all direct or indirect liability,
indebtedness, obligation, commitment, expense, claim, deficiency, guaranty or
endorsement of or by any person of any type, whether accrued, absolute,
contingent, matured, liquidated or unliquidated, matured or unmatured or
otherwise, including, without limitation, tax liabilities.

                  “Liens” means all liens, mortgages, easements, pledges, charges,
restrictions, claims, security interests, options or other encumbrances of any
nature.

                  “Note” shall mean that Subordinated Promissory Note in the original
principal amount set forth in Section 1.2 hereof to be issued at Closing by the
Partnership in accordance with Section 1.2 hereof, as the purchase price
payable to the order of SunSub, in the form attached hereto as Exhibit A
(together with such modifications as may be reasonably requested by any lender
under the Credit Documents, provided such modifications do not materially
change or modify the material terms of the Note (including the financial
terms), it being understood that any substantive change to the economic or
other substantive terms of the Note which adversely effect the Holder’s rights
or obligations thereunder shall be deemed a material change for the purposes of
this provision).

                  “Note Documents” shall mean, the Securities Purchase Agreement, each
Senior Subordinated Note and all other documents, instruments and agreements
delivered pursuant to or in connection with the Securities Purchase Agreement
and/or any Senior Subordinated Note.

                  “Organizational Documents” shall mean the charter, articles, memorandum
or certificate of incorporation or associations, partnership agreement,
certificate of limited partnership, operating agreement, limited liability
company agreement, certificate of formation,

18

 

by-laws or other similar formation
or governance agreements of any entity, whether or not filed with a
Governmental Authority.

                  “Person” shall mean any individual, partnership, firm, corporation,
association, trust, unincorporated organization, joint venture, limited
liability company, unlimited liability

                  “Representative” shall mean any officer, director, principal, attorney,
stockholder financial advisor, lender, accountant, general or limited partner,
member, trustee, agent, employee or other representative of a Person or its
Affiliates.

                  “Securities Act” shall mean the Securities Act of 1933, as amended, and
the rules and regulations promulgated thereunder.

                  “Securities Purchase Agreement” means those certain Securities Purchase
Agreements, originally dated March 2, 2000, among the Partnership, the
Subsidiary Partnership, and the purchasers of Senior Subordinated Notes
thereunder, as the same may be amended, restated, modified, replaced,
refinanced or supplemented from time to time.

                  “Senior Credit Agreement” shall mean that certain Credit Agreement, dated
as of March 2, 2000, among the Subsidiary Partnership, as borrower, Bank of
America, N.A., as Administrative Agent and lender, and those other financial
institutions signatory thereto, as lenders, as the same may be amended,
restated, modified, replaced, refinanced or supplemented from time to time.

                  “Senior Subordinated Notes” means those certain 12% Senior Subordinated
Notes of the Partnership due March 2, 2008 issued pursuant to the Securities
Purchase Agreements, as the same may be amended, restated, modified, replaced,
refinanced or supplemented from time to time.

                  “Subsidiary Partnership” shall mean GC-SUN Holdings II, L.P., a Delaware
limited partnership.

                  “SunSub Units” shall mean the following Units in the Partnership issued to
SunSub: (i) 49,000 Class B Units and (ii) 659.352 Class F Units.

                  “Unit” shall have the meaning set forth in the Partnership Agreement.

                  Section 8.2       Other Interpretive Provisions. The words “hereof”, “herein”
and “hereunder” and words of similar import when used in this Agreement shall
refer to this Agreement as a whole and not to any particular provision of this
Agreement, and Section and Exhibit references are to this Agreement unless
otherwise specified. The meanings given to terms defined herein shall be
equally applicable to both the singular and plural forms of such terms.

19

 

ARTICLE IX.

GENERAL PROVISIONS

                  Section 9.1       Expenses. Each party to this Agreement shall pay all fees and
expenses incurred by it in connection with this Agreement and the transactions
contemplated by this Agreement.

                  Section 9.2       Notices. Any notices or other communications required or
permitted under, or otherwise in connection with, this Agreement shall be in
writing and shall be deemed to have been duly given when delivered in person or
upon confirmation of receipt when transmitted by facsimile transmission (but
only if followed by transmittal by national overnight courier or hand for
delivery on the next Business Day) or on receipt after dispatch by registered
or certified mail, postage prepaid, addressed, or on the next Business Day if
transmitted by national overnight courier, in each case as follows:

	 	 	 	 
	 	(a)	 	
if to any of the SunSource Entities, to:
	
	
	
	

	 	 	 	 
	
	
	
	

	 	 	 	
The Hillman Companies, Inc.
	
	
	
	

	 	 	 	
10590 Hamilton Road
	
	
	
	

	 	 	 	
Cincinatti, OH, 45231
	
	
	
	

	 	 	 	
Facsimile: (215) 282-1290
	
	
	
	

	 	 	 	
Attention: James P. Waters
	
	
	
	

	 	 	 	 
	
	
	
	

	 	 	 	
with a copy to (but not as required notice hereunder):
	
	
	
	

	 	 	 	 
	
	
	
	

	 	 	 	
Piper Marbury Rudnick & Wolfe LLP
	
	
	
	

	 	 	 	
1200 19th Street, N.W.
	
	
	
	

	 	 	 	
Washington, D.C. 20036
	
	
	
	

	 	 	 	
Facsimile: (202) 223-2085
	
	
	
	

	 	 	 	
Attention: Anthony H. Rickert, Esq.
	
	
	
	

	 	 	 	 
	
	
	
	

	 	(b)	 	
if to the Partnership, to:
	
	
	
	

	 	 	 	 
	
	
	
	

	 	 	 	
GC-SUN Holdings, L.P.
	
	
	
	

	 	 	 	
c/o Glencoe Capital, L.L.C.
	
	
	
	

	 	 	 	
190 S. LaSalle Street, Suite 2330
	
	
	
	

	 	 	 	
Chicago, Illinois 60603
	
	
	
	

	 	 	 	
Facsimile: (312) 795-0455
	
	
	
	

	 	 	 	
Attention: Ronald D. Wray

20

 

	 	 	 	 
	
	
	
	

	 	 	 	
with a copy to (but not as required notice hereunder):
	
	
	
	

	 	 	 	 
	
	
	
	

	 	 	 	
Latham & Watkins
	
	
	
	

	 	 	 	
233 S. Wacker Drive
	
	
	
	

	 	 	 	
Sears Tower, Suite 5800
	
	
	
	

	 	 	 	
Chicago, Illinois 60606
	
	
	
	

	 	 	 	
Telecopy: (312) 993-9767
	
	
	
	

	 	 	 	
Attention: Mark D. Gerstein, Esq.

or such other address as the person to whom notice is to be given has furnished
in writing to the other parties. A notice of change in address shall not be
deemed to have been given until received by the addressee.

                  Section 9.3       Headings; Table of Contents. The descriptive headings
contained in this Agreement and table of contents of this Agreement are for
convenience of reference only and shall not affect in any way the meaning or
interpretation of this Agreement.

                  Section 9.4       Severability. If any term or other provision of this
Agreement is invalid, illegal or incapable of being enforced by any Law or
public policy, all other terms and provisions of this Agreement shall
nevertheless remain in full force and effect so long as the economic or legal
substance of the transactions contemplated hereby is not affected in any manner
materially adverse to any party.

                  Section 9.5       Entire Agreement. This Agreement (including all exhibits,
documents, and materials hereunder referred to) constitute the entire agreement
of the parties hereto with respect to the subject matter hereof and supersede
all prior agreements and undertakings, both written and oral, among the parties
hereto with respect to the subject matter hereof.

                  Section 9.6       Assignment. This Agreement may not be assigned (by operation
of law or otherwise) by the SunSource Entities without the prior written
consent of the Partnership, which consent shall not be unreasonably withheld.
This Agreement may not be assigned (by operation of law or
otherwise) by the Partnership without the prior written consent of
SunSource, which consent may be granted or withheld in its sole discretion,
except that the Partnership may, without the prior written consent of any
SunSource Entity, transfer or assign this Agreement by operation of law or
otherwise to any wholly-owned Affiliate of the Partnership, provided the
Partnership remains bound by its obligations under this Agreement.
Notwithstanding anything in this Agreement, including, without limitation, this
Section 9.6, (a) the Partnership may, without the prior consent of any Person,
collaterally assign any or all of its rights under this Agreement to the
lenders, or agents therefor, providing any financing to the Partnership and (b)
any of the SunSource Entities may, without the prior consent of any Person,
collaterally assign any or all of its rights under this Agreement to the Bank
of America. Any attempted assignment in violation of this Section 9.7 shall be
null and void.

                  Section 9.7       No Third Party Beneficiaries. This Agreement shall be binding
upon and inure solely to the benefit of the parties hereto and their permitted
assigns and nothing herein, express or implied, is intended to or shall confer
upon any other Person any legal or

21

 

equitable right, benefit or remedy of any
nature whatsoever under or by reason of this Agreement.

                  Section 9.8       Amendment. This Agreement may not be amended except by an
instrument in writing signed by the parties hereto.

                  Section 9.9       Waiver. Any party to this Agreement may (a) extend the time
for the performance of any of the obligations or other acts of any other party,
(b) waive any inaccuracies in the representations and warranties of another
party contained herein or in any document delivered by another party pursuant
hereto, or (c) waive compliance with any of the covenants, agreements or
conditions of another party contained herein. Any such extension or waiver
shall be valid only if set forth in an instrument in writing signed by the
party to be bound thereby. Any waiver of any term or condition shall not be
construed as a waiver of any subsequent breach or a subsequent waiver of the
same term or condition, or a waiver of any other term or condition, of this
Agreement. The failure of any party hereto to assert any of its rights
hereunder shall not constitute a waiver of any of such rights.

                  Section 9.10       GOVERNING LAW; WAIVER OF JURY TRIAL. THIS AGREEMENT SHALL BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF
DELAWARE, WITHOUT REGARD TO ANY CONFLICTS OF LAWS. ALL ACTIONS AND PROCEEDINGS
ARISING OUT OF OR RELATING TO THIS AGREEMENT SHALL BE HEARD AND DETERMINED IN
ANY FEDERAL COURT SITTING IN THE COUNTY OF NEW CASTLE, UNLESS THERE IS NO
FEDERAL COURT JURISDICTION, IN WHICH CASE THE ACTION OR PROCEEDING SHALL BE
HEARD AND DETERMINED IN ANY STATE COURT SITTING IN THE COUNTY OF NEWCASTLE, AND
THE PARTIES HERETO HEREBY IRREVOCABLY SUBMIT TO THE EXCLUSIVE JURISDICTION OF
SUCH COURTS IN ANY SUCH ACTION OR PROCEEDING AND IRREVOCABLY WAIVE THE DEFENSE
OF AN INCONVENIENT FORUM WITH RESPECT THERETO. THE PARTIES HERETO HEREBY
IRREVOCABLY WAIVE THEIR RESPECTIVE RIGHTS TO TRIAL BY JURY OF ANY CAUSE OF
ACTION, CLAIM, COUNTERCLAIM OR CROSS-COMPLAINT IN ANY ACTION OR OTHER
PROCEEDING BROUGHT BY ANY PARTY HERETO AGAINST ANY OTHER PARTY OR PARTIES
HERETO WITH RESPECT TO ANY MATTER ARISING OUT OF, OR IN ANY WAY CONNECTED WITH
OR RELATED TO, THIS AGREEMENT OR ANY PORTION THEREOF, WHETHER BASED UPON
CONTRACTUAL, STATUTORY, TORTIOUS OR OTHER THEORIES OF LIABILITY. EACH PARTY
IRREVOCABLY CONSENTS TO THE SERVICE OF ANY AND ALL PROCESS IN ANY SUCH ACTION
OR PROCEEDING BY THE MAILING OF COPIES OF SUCH PROCESS TO SUCH PARTY AT ITS
ADDRESS FOR NOTICE UNDER SECTION 9.2 OF THIS AGREEMENT. NOTHING IN THIS
SECTION 9.10 SHALL AFFECT THE RIGHT OF ANY PARTY HERETO TO SERVE LEGAL PROCESS
IN ANY OTHER MANNER PERMITTED BY LAW. THE CONSENTS TO JURISDICTION SET FORTH
IN THIS SECTION 9.10 SHALL NOT CONSTITUTE GENERAL CONSENTS TO SERVICE OF
PROCESS IN THE VENUES SPECIFIED ABOVE AND SHALL HAVE NO EFFECT FOR ANY PURPOSE
EXCEPT AS PROVIDED IN THIS SECTION 9.10 AND SHALL NOT BE DEEMED TO CONFER
RIGHTS ON ANY PERSON OTHER THAN THE PARTIES HERETO.

22

 

                  Section 9.11       Specific Performance. Each of the parties hereto
acknowledges and agrees that the other parties hereto would be damaged
irreparably in the event any of the provisions of this Agreement are not
performed in accordance with their specific terms or otherwise are breached.
Accordingly, each of the parties hereto agrees that the other parties shall be
entitled to an injunction or injunctions to prevent breaches of the provisions
of this Agreement and to specifically enforce this Agreement and the terms and
provisions hereof in any action instituted in any court having jurisdiction
over the parties hereto and the matter (subject to the provisions set forth in
this Section 9.11 of this Agreement), in addition to any other remedy to which
they may be entitled, at law or in equity.

                  Section 9.12       Counterparts. This Agreement may be executed in one or more
counterparts, and by the different parties hereto in separate counterparts,
each of which when executed shall be deemed to be an original but all of which
taken together shall constitute one and the same agreement.

[Signature page follows]

23

 

                  IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the date first written above by their respective officers
thereunto duly authorized.

	 	 	 	 	 	 	 
	 	GC-SUN HOLDINGS, L.P.
	
	
	
	

	 	 	 	 	 	 	 
	
	
	
	

	 	
By:
	 	 	GC-SUN G.P., Inc., its general partner
	
	
	
	

	 	 	 	 	 	 	 
	
	
	
	

	 	 	 	 	By:	 	/s/
Ronald D. Wray
	
	
	
	

	 	 	 	 	 	

	
	
	
	

	 	 	 	 	 	 	Name:
	
	
	
	

	 	 	 	 	 	 	Title:
	
	
	
	

	 	 	 	 	 	 	 
	
	
	
	

	 	THE HILLMAN COMPANIES, INC.
	
	
	
	

	 	 	 	 	 	 	 
	
	
	
	

	 	By:	 	/s/ Maurice P.
Andrien, Jr.	 	 	 
	
	
	
	

	 	 	 	

	
	
	
	

	 	 	 	Name: Maurice P.
Andrien, Jr.
	
	
	
	

	 	 	 	Title: Chief
Executive Officer
	
	
	
	

	 	 	 	 	 	 	 
	
	
	
	

	 	SUNSUB HOLDINGS, LLC
	
	
	
	

	 	 	 	 	 	 	 
	
	
	
	

	 	By:	 	/s/ Maurice P.
Andrien, Jr.	 	 	 
	
	
	
	

	 	 	

	
	
	
	

	 	 	Name:
Maurice P. Andrien, Jr.
	
	
	
	

	 	 	Title:
Manager

	
	
	
	

	 	 	 	 	 	 	 
	
	
	
	

	 	 	 	 	 	 	 
	
	
	
	

	 	 	 	 	 	 	 
	
	
	
	

SIGNATURE PAGE TO UNIT REPURCHASE AGREEMENTexv10w1

 

 Exhibit 10.1

[Novavax Letterhead]

January 14, 2002

Ann Oliver McGeehan

4387 Embassy Park Drive, NW

Washington, DC 20016

Dear Ann:

     
On behalf of Novavax, Inc. (the “Company”), I am
pleased to offer you the position of General Counsel and
Corporate Officer of the Company, subject to satisfactory
reference checks. We are greatly looking forward to your joining
the Company’s team.

     
Job Title: General Counsel and Corporate Officer

     
Start Date: February 4, 2002

     
Salary: $185,000 per year payable in accordance with the
Company’s payroll policies in effect from time to time.

     
Bonus Program: You will be entitled to participate in a
bonus program if the Company hereafter establishes one for the
benefit of senior executives and other employees of the Company,
under which award payments, if any, will be based on performance
criteria and milestones to be mutually determined by the Company
and you.

     
Stock Options: The Company will grant you stock options to
purchase 75,000 shares of the Company’s Common Stock ($.01
par value) at an exercise price equal to the closing price of
the Company’s Common Stock on the date of grant (date of
quarterly scheduled Board meeting). The options will vest as to
one-third of the shares on the first anniversary of the date of
grant, as to an additional one-third of the shares on the second
anniversary of the date of grant and as to the final one-third
of the shares on the third anniversary of the date of grant;
provided that all unvested options shall become vested in the
event of a change of control of the Company which would
otherwise result in the termination of such options and/ or your
employment with the Company, to the extent permitted by the
Internal Revenue Code.

     
Benefits: The Company will provide medical and dental
benefits, life insurance, and disability insurance in accordance
with the Company’s policies in effect from time to time. As
of the date of this letter, the Company currently pays 100% of
family coverage as provided by the Company’s group medical
insurer, 100% of the premium for life insurance under the
Company’s group life insurance plan and 100% of the premium
for the Company’s long-term disability insurance.

     
Vacation: You will be entitled to four weeks of vacation
time during each year, calculated on a calendar year basis in
accordance with the Company’s policies in effect from time
to time.

 

 Ann Oliver McGeehan

January 14, 2002

Page two

     
Employment Requirements and Term: You will be required by
the Company to sign the Company’s standard form of
Non-Disclosure Agreement as a condition to your employment by
the Company. In addition, it is a requirement that the Company
and you negotiate and sign an Employment Agreement which, among
other things, will provide for severance pay of one year’s
salary in the event of an early termination of employment
without “Cause”, or a buyout in whole or in part and a
one-year noncompetition covenant.

     
Relocation/Sign-on: You will be expected to relocate to the
Columbia, Maryland area within nine months from your date of
hire. We urge you to be expeditious in this relocation. Upon the
date of your 1st paycheck, you will receive $52,500, which may
cover expenses related to the sale and purchase of your
residence.

     
Forgivable Loan: The Company will grant you a loan of
$92,500, forgivable at $18,500 per year over five (5) year
period. During this period, in the event of an early termination
without “Cause”, or a buyout in whole or in part, the
loan will be forgiven in its entirety.

     
Entire Agreement: This agreement sets forth the entire
agreement and understanding between you and the Company
regarding all subjects covered herein, the terms of which may
not be changed or modified except by agreement in writing signed
by you and the Company.

     
Severability: Should any provision of this agreement, or
portion thereof, be found invalid and unenforceable, the
remaining provisions shall continue in full force and effect.

     
Governing Law: This agreement shall be governed, construed
and enforced in accordance with the laws of Delaware, without
regard to principles of conflict of law.

     
Conflict: You hereby acknowledge that you are not a party
to any agreement that in any way prohibits or imposes any
restriction on your employment with the Company, and your
acceptance hereof will not breach any agreement to which you are
a party.

     
Please acknowledge your acceptance of this offer by signing the
copy of this letter and returning it to me.

     
“Cause” for the purpose of this letter agreement shall
mean: (i) fraud or embezzlement involving the assets
of the company, its customers, suppliers or affiliates, or other
misappropriations of the Company’s assets or funds;
(ii) your conviction of a felony offense or (iii) habitual
use of drugs or insanity.

     
Best regards,

		
	 	
     Leslie A. Edmond 

     Associate Director of Human Resources

     
ACCEPTED:

 

		
	/s/     Ann O. McGeehan	Jan. 22, 2002

		
	Ann Oliver McGeehan	Date

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