“Omega Business” means any businesses carried out by the Omega Group, now or in the past.

    “Omega Combined Income Tax” shall mean, with respect to any period for which the Omega Group is included in any of Mestek’s combined or unitary groups, the liability for state or local Income Tax of the Omega Group computed as though the Omega Group filed a Tax Return separate from Mestek for such taxable period, which amount shall not be less than zero.

    “Omega Federal Income Tax” shall mean, with respect to any period for which the Omega Group is included in Mestek’s consolidated group, the liability for U.S. federal Income Tax (including “alternative minimum tax”, if any) of the Omega Group computed as though the Omega Group filed a U.S. federal Income Tax Return separate from Mestek for such taxable period, which amount shall not be less than zero.

    “Omega Group” shall mean, collectively or separately, Omega and any Subsidiary of Omega for which Omega has any direct or indirect Tax liability.

    “Omega State Income Tax” shall mean any state or local Income Tax imposed on any member of the Omega Group (which is not a Omega Combined Income Tax).

    “Mestek Group” shall mean, collectively or separately, Mestek and any Subsidiary of Mestek for which Mestek has any direct or indirect Tax liability, other than any member of the Omega Group.

    “Income Tax” shall mean any tax imposed on net income, including the Michigan Single Business Tax.

    “Other Omega Tax” means any Tax of the Omega Group or with respect to the Omega Business that is not an Income Tax (whether payable directly by Omega Group or payable by a combined or unitary group that includes the Omega Group to the extent of Omega Group’s portion of such Tax).

    “Post-Distribution Period” means all taxable periods or portions of periods beginning on or after the Distribution Date.

    “Pre-Distribution Period” means all taxable periods or portions of periods ending before the Distribution Date.

    “Subsidiary”means any corporation, company, partnership or other business organization of which 50% or more of its equity interests are owned by another corporation, company, partnership or other business organization.

    “Tax”means any income, gross income, gross receipts, profits, capital stock, franchise, withholding, payroll, social security, workers compensation, unemployment, disability, property, ad valorem, stamp, excise, severance, occupation, service, sales, use, license, lease, transfer, import, export, value added, alternative minimum, estimated or other similar tax (including any fee, assessment, or other charge in the nature of or in lieu of any tax) imposed by any governmental entity or political subdivision thereof, and any interest, penalties, additions to tax, or additional amounts in respect of the foregoing imposed on any taxpayer or consolidated, combined or unitary group of taxpayers.

    “Tax Authority” means, with respect to any Tax, the governmental entity or political subdivision thereof that imposes such Tax, and the agency (if any) charged with the collection of such Tax for such entity or subdivision.

    “Tax Benefit” means the amount that any item of loss, deduction or credit (or any other item) decreases Taxes paid or payable including any interest with respect thereto or interest that would have been payable but for such item, net of any Tax imposed on such interest.

    “Tax Contest” means an audit, review, examination, or any other administrative or judicial proceeding with the purpose or effect of re-determining any Tax (including any administrative or judicial review of any claim for refund).

    “Tax Detriment” means the amount that any item of income or gain (or any other item) increases Taxes paid or payable including any interest with respect thereto.

    “Tax Return” means any report of Tax due, any claims for refund of Tax paid, any information return with respect to Tax, any election made with respect to Tax, or any other similar report, statement, declaration, or document required to be filed under the Code or other law in respect of Tax, including any attachments, exhibits, or other materials submitted with any of the foregoing, and including any amendments or supplements to any of the foregoing for any taxpayer or consolidated, combined or unitary group of taxpayers.

    2.1         Mestek’s Responsibility

    (a)               Mestek shall be responsible for and indemnify and hold harmless the Omega Group from (i) any liability for Omega Federal Income Tax and Omega Combined Income Tax with respect to the Pre-Distribution Period (other than Income Taxes described in Section 2.2(b); (ii) any Income Tax of the Mestek Group by reason of Omega Group being severally liable for such Income Tax pursuant to Treasury Regulations Section 1.1502-6 or any analogous provision of state or local law; and (iii) any item described in Section 3.1 to the extent not covered by Section 3.2.

    (b)               Notwithstanding the provisions of clause (i) of Section 2.1(a), for all periods in which Omega is a member of Mestek’s consolidated group, Omega shall be responsible for and shall pay to Mestek, on or prior to the Distribution Date, an amount equal to the estimate of the Omega Federal Income Tax for such periods, as determined by Mestek in good faith and in the ordinary course of business, subject to final determination of such amount as provided in Section 2.5(a).

    (c)               Notwithstanding the provisions of clause (i) of Section 2.1(a), for all periods in which Omega or any other member of the Omega Group is a member of a state or local consolidated, combined or unitary group of which any member of the Mestek Group is the parent, Omega shall be responsible for and shall pay to Mestek, on or prior to the Distribution Date, an amount equal to the estimate of the Omega Combined Income Tax for such periods, as determined by Mestek in good faith and in the ordinary course of business, subject to final determination of such amount as provided in Section 2.5(a).

    2.2         Omega’s Responsibility

    (a)               Omega shall be responsible for, and indemnify and hold harmless the Mestek Group from (i) all Income Tax of the Omega Group with respect to a Post-Distribution Period; (ii) Income Taxes described in Section 2.2(b); (iii) all Other Omega Tax (regardless of which period it relates to); and (iv) any act for which Omega is liable under Section 3.2.

    (b)               In the event that any jurisdiction determines that the income of any member of the Omega Group is included or includible with the income of any member of the Mestek Group for purposes of calculating the combined, consolidated, or unitary Tax liability of the Mestek Group and, as of the date hereof, the income of such member of the Omega Group was not so included by any member of the Mestek Group in a combined, consolidated, or unitary group of which such member of the Mestek Group was the common parent, Omega shall be responsible for and shall pay to Mestek any Income Tax liability incurred by any member of the Mestek Group as a result of such determination.

    2.3         General Responsibilities . For purposes of this Agreement, in the case of any taxable period that begins before and ends after the Distribution Date, the amount of Omega Federal Income Tax and/or Omega Combined Income Tax payable for such taxable period shall be allocated pro rata between the time period before the Distribution Date and the time period after the Distribution Date, as of each such time period.

    2.4         Refunds and Tax Benefits

    (a)               Refunds and Carry backs . (i) Except as provided in (ii) or (iii) below, Mestek shall be entitled to any refunds of Omega Federal Income Tax and Omega Combined Income Tax (including refunds paid by means of a credit against other or future Tax liabilities) arising with respect to taxable periods ending on or before the Distribution Date; and Omega shall be entitled to any refunds of Income Tax of the Omega Group (including refunds paid by means of a credit against other or future Tax liabilities) arising with respect to taxable periods beginning on or after the Distribution Date. Mestek and Omega agree to allocate such refunds (including refunds paid by means of a credit against other or future Tax liabilities) arising with respect to taxable periods that begin before and end after the Distribution Date to whichever of Mestek or Omega initially accrued or recorded a liability for the Taxes to which such refund is attributable.

    (ii)               Omega shall be entitled to any refunds or credits of Omega State Income Tax or Other Omega Tax (including refunds paid by means of a credit against other or future Tax liabilities).

    (iii)               Omega shall promptly forward to Mestek or reimburse Mestek for any refunds due Mestek after receipt thereof, and Mestek shall promptly forward to Omega or reimburse Omega for any refunds due Omega after receipt thereof . In the case of a refund received in the form of a credit against other or future Tax liabilities, reimbursement in respect of such refund shall be due in each case on the due date for payment of the Tax against which such refund has been credited. If Mestek reasonably so requests, Omega, at Mestek’s expense, shall file for and pursue any refund to which Mestek is entitled under this Section 2.4(a). If Omega reasonably so requests, Mestek, at Omega’s expense, shall file for and pursue any refund to which Omega is entitled to under this Section 2.4(a).

    (iv)               Mestek agrees that if the Omega Group carries back any item of loss, deduction or credit which arises in any taxable period the Income Tax for which Omega is responsible, into any taxable period the Income Tax for which Mestek was responsible, then Omega shall be entitled to any Tax Benefit or refund of Tax realized as a result of the carry back.

    (v)               Notwithstanding anything to the contrary in this Section 2.4, Mestek shall not be entitled to, and Omega shall be entitled to, any refunds or credits with respect to Income Tax for which Omega was liable under Section 2.2(b).

    (b)               Allocation of Benefits . If as a result of or in settlement of any Tax Contest, any adjustments shall be made to any Tax Returns relating to Income Tax of the Omega Group or the Mestek Group for any period in which one of the parties was responsible for all or a portion of such Income Tax, and if such adjustment results in both Tax Detriment to one party or its subsidiaries and Tax Benefit to the other party, then the party receiving the Tax Benefit shall pay to the party subject to the Tax Detriment the amount of such Tax Benefit at such time or times as and to the extent that the party receiving the Tax Benefit realizes such benefit through a refund of Tax or reduction in the amount of Tax which would otherwise be paid if such adjustment had not been made.

    2.5         Preparation of Tax Returns: Payment of Tax

    (a)               Mestek shall cause the Omega Group to join, for any Pre-Distribution Period for which the Omega Group is required to do so (and may cause the Omega Group (or any member thereof) to join for any such period or Tax Return for which the Omega Group is eligible but not required to do so), in all federal, state or local consolidated, combined or unitary Income Tax Returns of Mestek’s filing group. Mestek shall prepare and timely file all such federal, state or local consolidated, combined or unitary Tax Returns and shall timely pay subject to 7.1(b) and (c) all Tax with respect to such Tax Returns. Mestek shall provide to Omega a copy of the portion of each such Tax Return and any supporting schedules that relate to the Omega Group within 20 days after the filing thereof. No later than December 31 (or as close as reasonably practicable thereto) of the year in which Mestek’s federal Income Tax Return with respect to such Tax is filed, Mestek shall provide to Omega a statement of the Omega Federal Income Tax and Omega Combined Income Tax for such period, as determined by Mestek in good faith and in the ordinary course of business based upon such Tax Returns. If (x) the sum of the estimates of such Omega Federal Income Tax and Omega Combined Income Tax as paid by Omega pursuant to Section 2.1(b) and (c) above is less than (y) the sum of the Omega Federal Income Tax and Omega Combined Income Tax as determined under this Section 2.5(a), Omega shall pay to Mestek the difference between (x) and (y). If (x) the sum of the estimates of such Omega Federal Income Tax and Omega Combined Income Tax as paid by Omega pursuant to Section 2.1(b) and (c) above is more than (y) the sum of the Omega Federal Income Tax and Omega Combined Income Tax as determined under this Section 2.5(a), Mestek shall pay to Omega the difference between (x) and (y).

    (b)               Mestek shall prepare (or cause to be prepared), at Omega’s expense (or where appropriate through the utilization of Omega’s staff), and Omega shall timely file (or cause to be timely filed) any Tax Return relating to Omega State Income Tax for any period that begins before the Distribution Date (or any portion of such a Tax Return which relates to the Pre-Distribution Period) whether it is required to be filed before or after the Distribution Date. Mestek shall provide a copy of each such Tax Return (or portion thereof) and any supporting schedules to Omega at least 30 days before the date such Return is to be filed by Omega for Omega’s review and approval, which approval shall not be unreasonably withheld. Omega shall pay all Tax with respect to such Tax Return for which it is responsible pursuant to Section 2.1. Mestek shall pay to Omega at least 5 days prior to the filing of such Tax Return any amount due on such Tax Return that is the responsibility of Mestek pursuant to Section 2.1.

    (c)               Omega shall be responsible for the preparation and filing of Tax Returns relating to Other Omega Tax. Omega shall pay all Tax with respect to any such Tax Returns.

    (d)               Omega shall not file (or allow the Omega Group to file) any amended Tax Returns with respect to the Omega Group for any Pre-Distribution Period without Mestek’s consent.

    2.6         Cooperation and Exchange of Information . Mestek on the one hand, and Omega, on the other, will timely and competently provide each other with such cooperation and information as either of them reasonably may request of the other in (i) filing any Tax Return, amended return or claim for refund, (ii) determining a liability for Tax or a right to a refund of Tax or (iii) participating in or conducting any audit or other proceeding in respect of Tax. Such cooperation and information shall include providing copies of relevant Tax Returns or portions thereof, together with accompanying schedules and related work papers and documents relating to rulings or other determinations by any Tax Authorities. Each party shall devote the personnel and resources necessary in order to carry out this Section 2.6 and shall make its employees available on a mutually convenient basis to provide explanations of any documents or information provided hereunder. Except as provided below, each party shall carry out their responsibilities under this Section 2.6 without charge to the other. Any information obtained under this Section 2.6 shall be subject to the Confidentiality and Nondisclosure Agreement of even date herewith between the parties, except as may be otherwise necessary in connection with the filing of Tax Returns or claims for refund or in conducting an audit or other proceeding. Notwithstanding the foregoing, Omega shall reimburse Mestek for any out-of-pocket costs and expenses incurred with respect to matters concerning Omega State Income Tax for the Pre-Distribution Period. It is further understood that in order to reduce the cost to Omega in connection with Omega State Income Tax matters, to the extent appropriate, Mestek shall utilize and Omega shall provide, members of Omega’s staff.

    2.7         Tax Contests

    (a)               Notice . Each of the parties shall provide prompt notice to the other party of any pending or threatened Tax audit, assessment or proceeding or other Tax Contest of which it becomes aware related to Tax for which it is indemnified by the other party hereunder. Such notice shall contain factual information (to the extent known) describing any asserted Tax liability in reasonable detail and shall be accompanied by copies of any notice and other documents received from any Tax Authority in respect of any such matters. If an indemnified party has knowledge of an asserted Tax liability with respect to a matter for which it is to be indemnified hereunder and such party fails to give the indemnifying party prompt notice of such asserted Tax liability, then (i) if the indemnifying party is precluded from contesting the asserted Tax liability in any forum as a result of the failure to give prompt notice, the indemnifying party shall have no obligation to indemnify the indemnified party for any Tax arising out of such asserted Tax liability, and (ii) if the indemnifying party is not precluded from contesting the asserted Tax liability in any forum, but such failure to give prompt notice results in a monetary detriment to the indemnifying party, then any amount which the indemnifying party is otherwise required to pay the indemnified party pursuant to this Agreement shall be reduced by the amount of such detriment.

    (b)               Control of Tax Contests . Each party shall have full responsibility and discretion in handling, settling or contesting any Tax Contest involving a Tax for which it is liable pursuant to Section 2 of this Agreement; provided, however, Mestek shall have full responsibility and discretion in handling, settling or contesting any Tax Contest with respect to a consolidated, combined or unitary federal or state Income Tax of which Mestek or a Mestek Subsidiary is the common parent. In the event that Mestek controls (pursuant to the proviso in the previous sentence) any Tax Contest which gives rise to a Omega indemnification obligation hereunder, Mestek shall consult with Omega with respect to such Tax Contest (to the extent such Tax Contest relates to issues for which Omega is liable) and shall consider in good faith Omega’s advice with respect thereto. Furthermore Mestek may participate in any Tax Contest with respect to any Covered Transaction Tax (as hereinafter defined), and Omega shall consider in good faith Mestek’s advice with respect thereto, regardless of whether Mestek has liability or indemnification obligations with respect to such Tax under this Agreement.

    3.1         General . Except as otherwise provided in Section 3.2, Mestek shall be responsible for and pay any and all Tax resulting from income or gain recognized by Mestek as a result of the Distribution failing to qualify for or maintain tax-free treatment pursuant to Section 355 of the Code or other provisions of the Code or corresponding provisions of other applicable Tax laws, and any Tax resulting from any income or gain recognized by Mestek or its Subsidiaries (including the Omega Group) under Treasury Regulations Sections 1.1502-13 or 1.1502-19 (or any corresponding provisions of other applicable Tax laws) as a result of the Distribution (collectively “Covered Transaction Tax”).

    3.2         Inconsistent Acts and Events . Omega shall be liable for, and shall indemnify and hold harmless the Mestek Group from and against any liability for, any Covered Transactions Tax (including without limitation reasonable attorney fees and other costs incurred in connection therewith) to the extent arising from (i) any breach by the Omega Group of the representations or covenants under Section 4, (ii) any Tainting Act (as hereinafter defined) performed by the Omega Group (whether or not Section 4.2(c) is complied with) and (iii) any Section 355(e) Event with respect to Omega (whether or not such event is caused by a Tainting Act). A “Section 355(e) Event” with respect to Omega means any fact, circumstance, event or occurrence relating to the stock of Omega or assets of the Omega Group, that causes the Distribution to be a taxable event to Mestek as the result of the application of Section 355(e) of the Code (i.e., the Distribution becomes taxable to Mestek under Section 355(e) and, but for such fact, circumstance, event or occurrence, the Distribution would not have been a taxable event to Mestek under Section 355(e)).

    4.1         Representations

    (a)               Each of Omega and Mestek represent that, as of the date of this Agreement, it and its Subsidiaries knows of no fact or set of facts that would jeopardize the expected Tax treatment of the Distribution.

    (b)               Each of Omega and Mestek represent and warrant that neither it nor any of its Subsidiaries has any plan or intent to take any action which is inconsistent with the expected Tax treatment of the Distribution.

    4.2         Covenants

    (a)               Omega covenants and agrees that it will not take any action, and it will cause its Subsidiaries to refrain from taking any action, which is inconsistent with the Tax-free treatment of the Distribution (any such action, including any action referred to in clause (i) through (iii), is referred to in this Agreement as a “Tainting Act”). Without limiting the foregoing:

    (i)               Specified Actions . During the two year period following the Distribution Date, Omega will not (and it will cause its Subsidiaries not to) (A) liquidate, merge or consolidate with or into any other corporation, company, partnership or other business organization; (B) issue any of its capital stock in one or more transactions, other than, with respect to (1) the exercise of options that are granted by Omega before the Closing Date, or with respect to the exercise of options that are granted by Omega on or after the Closing Date, that satisfy the requirements of Treasury Regulations Section 1.355-7T(d)(6) to not be treated for purposes of Section 355(e) of the Code to be part of a plan or series of related transactions that includes the Distribution, or (2) issuances of stock to a retirement plan qualified under Section 401(a) or 403(a) of the Code in a transaction which satisfies the requirements of Treasury Regulations Section 1.355-7T(d)(7); (C) redeem, purchase or otherwise reacquire its capital stock in one or more transactions; (D) change the voting rights of any of its stock; (E) sell, exchange, distribute or otherwise dispose of, other than in the ordinary course of business, all or a substantial part of the assets of any of the trades or businesses relied upon to satisfy Section 355(b) of the Code; (F) issue any options to acquire Omega Shares other than options which satisfy the requirements of Treasury Regulations Section 1.355-7T(e)(3)(ii); or (G) discontinue or cause to be discontinued the active conduct of any of the trades or businesses relied upon to satisfy Section 355(b) of the Code.

    (ii)               No Inconsistent Actions . Regardless of any change in circumstances, Omega covenants and agrees that it will not take any action (and it will cause its Subsidiaries to refrain from taking any action) which is inconsistent with any factual statements or representations upon which the tax opinion letter of Greenberg Traurig dated _______, 2005 was based on or before the second anniversary of the Distribution Date other than as permitted in this Section 4. For this purpose, an action is considered inconsistent with a representation if the representation states that there is no plan or intention to take such action.

    (iii)               355(e) Covenant . Without in any manner limiting paragraphs (i) or (ii) immediately above, Omega covenants and agrees that, through the second anniversary of the Distribution Date, it will not enter into (and it will cause its Subsidiaries to refrain from entering into) any agreements, understandings, arrangements or substantial negotiations with respect to transactions or events (including stock issuances, option grants, capital contributions, acquisitions, or changes in the voting power of any of its stock), which may cause the Distribution to be treated as part of a plan pursuant to which one or more persons acquire directly or indirectly Omega stock representing a “50 percent or greater interest” within the meaning of Section 355(e)(4) of the Code.

    (b)               Consistent Tax Returns . Each of Mestek and Omega covenants and agrees that it will not take, and it will cause its Subsidiaries to refrain from taking, any position on a Tax Return that is inconsistent with the treatment of the Distribution as tax-free pursuant to Code Section 355.

    (c)               Exceptions . Notwithstanding the foregoing, Mestek may consent in its sole and absolute discretion to certain actions proposed by Omega to be taken after the Distribution Date that may be inconsistent with Section 4.2(a) if Omega provides a written request to Mestek for its plans with respect to such action, and promptly responds to any inquiries by Mestek following such notification, and Omega obtains an unqualified opinion acceptable to Mestek of an independent nationally recognized tax counsel acceptable to Mestek, on the basis of facts and representations consistent with the facts at the time of such action, that such action will not affect the Tax treatment of the Distribution.

    Notwithstanding anything to the contrary in this Agreement, Omega shall be liable for, and shall indemnify and hold harmless Mestek from any Covered Transaction Tax resulting from a Tainting Act by Omega or its Subsidiaries, regardless of whether the exception of this Section 4.2(c) is satisfied with respect to such act.

    5.1         Notice . Any payment, notice or communication required or permitted to be given under this Agreement shall be in writing (including facsimile) and mailed, faxed or delivered to the parties at the following addresses (or at such other address as one party may specify by notice to the other party):

     if to Mestek:

Mestek, Inc.
260 North Elm Street
Westfield, MA 01085
Attention: President
Fax: (413) 568-7428

Omega Flex, Inc.
451 Creamery Way
Exton, PA 19341
Attention: President
Fax: (610) 524-7282

    Notification of a change of address shall be given by either party to the other as provided in this Section 5.1. All such notices and communications shall be effective (i) when received, if mailed or delivered, or (ii) when confirmed by fax answerback, if faxed.

    5.2         Governing Law . This Agreement shall be governed by the laws applicable to contracts entered into and to be performed within the Commonwealth of Pennsylvania excluding its conflict laws.

    5.3         Dispute Resolution . Any and all disputes between Mestek and Omega arising out of any provision of this Agreement shall be resolved pursuant to Section _____ of the Distribution Agreement.

    5.4         Entire Agreement . This Agreement and the Distribution Agreement embodies the entire understanding between the parties relating to its subject matter and supersedes and terminates all prior agreements and understandings among the parties with respect to such matters. No promises, covenants or representations of any kind, other than those expressly stated herein, have been made to induce any party to enter into this Agreement. This Agreement shall not be modified or terminated except by a writing duly signed by each of the parties hereto, and no waiver of any provisions of this Agreement shall be effective unless in a writing duly signed by the party sought to be bound. If, and to the extent, the provisions of this Agreement conflict with the Distribution Agreement, or any other agreement entered into in connection with the Distribution, the provisions of this Agreement shall control.

    5.5         Assignment; Binding Effect . Neither this Agreement nor any of the rights, interests or obligations under this Agreement shall be assigned, in whole or in part, by operation of law or otherwise by any of the parties without the prior written consent of the other party; provided, however, that no such consent shall be required in the event of a merger, consolidation or sale of either Mestek or Omega. Subject to the preceding sentence, this Agreement shall be binding on, and shall inure to the benefit of, and be enforceable by, the parties hereto and their respective successors and assigns.

    5.6         Counterparts . This Agreement may be executed in two or more counterparts, each of which shall be deemed to be an original, but all of which together shall constitute one and the same.

    5.7         Severability . If any provision of this Agreement or the application of any such provision to any person or circumstances shall be held invalid, illegal, or unenforceable in any respect by a court of competent jurisdiction, such invalidity, illegality, or unenforceability shall not affect any other provision hereof.

    5.8         Headings . Headings of sections in this Agreement are inserted for convenience of reference only and are not intended to be a part of or to affect the meaning or interpretation of this Agreement.

    5.9         Survival . Notwithstanding anything in this Agreement to the contrary, the provisions of this Agreement shall survive for thirty days after the full period of all applicable statutes of limitations (giving effect to any waiver, mitigation or extension thereof).

    5.10         Payments . Unless a provision in this Agreement specifically provides a time period for payment, any payment owed under this Agreement shall be paid within 30 days after the date on which such payment becomes due.

    1.1         Indemnification by Omega.

    (a)               Indemnification . Except as otherwise provided in this Agreement, Omega shall, for itself and for each of its subsidiaries, indemnify, defend and hold harmless the Mestek Indemnitees from and against any and all Liabilities that any third party seeks to impose upon any of the Mestek Indemnitees, or which are imposed upon any of the Mestek Indemnitees, if and to the extent such Liabilities relate to, arise out of or result from any of the following items (without duplication):

    (i)        any breach by Omega or any of its subsidiaries (“Omega Group”) of the Distribution Agreement or any of the Ancillary Agreements (including this Agreement);

    (ii)        any Omega Liability, or

    (iii)       any Tax claimed, levied or assessed by any government authority against, or paid by, the Mestek Group (defined below) arising from or relating to [ ALT-1 the issuance by Omega of shares of its common stock after the Distribution, or the consummation by Omega after the Distribution of any transaction or series of transactions, and in either case pursuant to which one or more persons who are not Omega shareholders, directly or indirectly, as of the Distribution Date, acquire, directly or indirectly, shares of Omega common stock representing 50% or more of the then issued and outstanding Omega common stock.] [ ALT-2 Any action or series of actions by Omega that cause the Distribution not to qualify as a tax-free transaction under Section 355 of the Internal Revenue Code of 1986, as amended.]

    (b)               Reduction of Liability . In the event that any member of the Omega Group makes a payment to any Mestek Indemnitee hereunder, and the amount of Liabilities paid or the direct out-of-pocket costs incurred by Mestek for the Indemnitee are subsequently recovered by the Mestek Indemnitee, either directly or through a third-party recovery (other than as a result of a recovery under an insurance policy owned by Mestek and under which Omega is not an insured or an additional insured, Mestek will promptly repay (or will procure the relevant Mestek Indemnitee promptly to repay) such member of the Omega Group the amount by which the payment made by such member of the Omega Group exceeds the amount of the Liabilities actually paid by the Mestek Indemnitee.

    (c)               Joint and Several Liability; No Modification to Other Agreements . The liability of the members of the Omega Group under this Section 1.1 shall be joint and several. Nothing in this Section 1.1 shall modify or limit the rights and remedies of Mestek under the Distribution Agreement or any of the Ancillary Agreements (other than this Agreement) relating to, arising out of or resulting from any breach by Omega or any member of the Omega Group of the Distribution Agreement or any of the Ancillary Agreements (other than this Agreement), including without limitation, any provisions relating to the measure of damages, consequential damages, liquidated damages, limitation of damages and/or specific performance.

    1.2        Indemnification by Mestek.

    (a)               Indemnification . Except as otherwise provided in this Agreement, Mestek shall, for itself and its subsidiaries excluding the Omega Group, (the “Mestek Group”), indemnify, defend and hold harmless the Omega Indemnitees from and against any and all Liabilities that any third party seeks to impose upon any of the Omega Indemnitees, or which are imposed upon any of the Omega Indemnitees, if and to the extent such Liabilities relate to, arise out of or result from (without duplication):

    (i)               any breach by Mestek or any member of the Mestek Group of the Distribution Agreement or any of the Ancillary Agreements (including this Agreement); or

     (ii)        any Mestek Liability;

    provided,        however, that notwithstanding anything to the contrary herein, in no event shall Mestek or any member of the Mestek Group be obligated to indemnify, defend or hold harmless the Omega Indemnitees from, against or in respect of any Omega Liability.

    (b)               Reduction of Liability . In the event that any member of the Mestek Group makes a payment to any Omega Indemnitee hereunder, and the amount paid or the direct out-of-pocket costs incurred by the Omega Indemnitee for the Liabilities on account of which such payment was made are subsequently recovered by the Omega Indemnitee, either directly or through a third-party recovery, Omega will promptly repay (or will procure an Omega Indemnitee to promptly repay) such member of the Mestek Group the amount by which the payment made by such member of the Mestek Group exceeds the amount of the Liabilities actually paid by the Omega Indemnitee.

    (c)               Joint and Several Liability; No Modification to Other Agreements . The liability of the members of the Mestek Group under this Section 1.2 shall be joint and several. Nothing in this Section 1.2 shall modify or limit the rights and remedies of Omega under the Distribution Agreement or any of the Ancillary Agreements (other than this Agreement) relating to, arising out of or resulting from any breach by Mestek or any member of the Mestek Group of the Distribution Agreement or any of the Ancillary Agreements (other than this Agreement), including without limitation, any provisions relating to the measure of damages, consequential damages, liquidated damages, limitation of damages and/or specific performance.

    1.3         Procedures for Defense , Settlement and Indemnification of Third Party Claims .

    (a)               Notice of Claims . If an Indemnitee shall receive notice or otherwise learn of the assertion of any Third Party Claim with respect to which a party may be obligated to provide indemnification to such Indemnitee pursuant to Section 1.1 or 1.2, Mestek or Omega (as applicable) shall ensure that such Indemnitee shall give the potential Indemnifying Party written notice thereof (including any pleadings relating thereto) within twenty (20) days after becoming aware of such Third Party Claim. Any such notice shall describe the Third Party Claim in reasonable detail. Notwithstanding the foregoing, any delay or failure of any Indemnitee to give notice as provided in this Section 1.3(a) shall not relieve the Indemnifying Party of its obligations under this Article 1, except to the extent that the Indemnifying Party is actually and substantially prejudiced by such delay or failure to give notice.

    (b)               Defense by Indemnifying Party . For any Third Party Claim concerning which notice is required to be given under Section 1.3(a), the Indemnifying Party may elect to defend and, subject to Section 1.3(f), may settle or compromise the Third Party Claim using counsel appointed by the Indemnifying Party, which counsel shall be reasonably satisfactory to the Indemnitee. An Indemnifying Party electing to defend a Third Party Claim must notify the Indemnitee of its election to defend within twenty (20) days of receipt of notice of such claim pursuant to Section 1.3(a) or sooner if the nature of the Third Party Claim so requires.

    (c)               Defense by Mestek . Notwithstanding Section 1.3(b), Mestek, in its sole discretion, upon written notice to Omega, may elect to defend (or may at any time assume the defense of) and, subject to Section 1.3(f), may settle or compromise, any Third Party Claim or series of related Third Party Claims, regardless of whether Mestek is obligated to indemnify any member of the Omega Group in respect of such Third Party Claim or series of related Third Party Claims or whether Mestek acknowledges any obligation to indemnify any Omega Indemnitee if:

    (i)               any member of the Mestek Group is named as a party to any of such Third Party Claims; or

    (ii)               both Mestek and Omega may be Indemnifying Parties with respect to such Third Party Claim(s).

    (d)               Defense By Non-Electing Party . If the party having the right to elect to defend a Third Party Claim pursuant to Section 1.3(b) or 1.3(c) elects not to defend, or does not within any time frame required thereunder elect to defend, a particular claim, the other party shall defend such Third Party Claim. In such case, (i) the other party shall have the right, subject to Sections 1.3(c) and 1.3(f) to compromise, settle or consent to the entry of any judgment with respect to such Third Party Claim (but such compromise, settlement or judgment shall not necessarily be determinative of which party hereunder is entitled to indemnification) and (ii) the Indemnifying Party shall bear all costs and expenses of defending such Third Party Claim; provided, however, that if both parties may be Indemnifying Parties with respect to such Third Party Claim, the Non-Defending Party (defined below) shall reimburse the Defending Party for the Non-Defending Party’s pro rata share of all costs and expenses incurred by the Defending Party in connection with its defense of such Third Party Claim, based on the Non-Defending Party’s proportionate liability for any Liabilities relating to, arising out of or resulting from such Third Party Claim (after taking into account the parties’ indemnification obligations under this Agreement, other than with respect to payment of defense costs). If the parties proportionate liability for any such liabilities cannot be determined at any point in time while a Third Party Claim is pending, then Mestek and Omega shall each pay one-half of such costs and expenses, and the parties may subsequently reallocate all prior costs and expenses paid when the parties’ proportionate liability is finally determined.

    (e)               Participation by Non-Defending Party . In the event that a party (a “Defending Party”) elects or is required to defend a particular Third Party Claim pursuant to Section 1.3(b), 1.3(c) or 1.3(d), the other party (the “Non-Defending Party”) shall have the right to participate in the defense of such Third Party Claim; provided, however, that (i) the Defending Party shall control, manage and direct the defense of such Third Party Claim; and (ii) the costs and expenses of participating in such defense by the Non-Defending Party shall be the sole responsibility of the Non-Defending Party. Nothing in this Section 1.3(e) shall affect the rights of Mestek under Section 1.3(c) at any time to assume the defense of any Third Party Claim and to be indemnified for costs and expenses of such defense in accordance with Section 1.3(c).

    (f)               No Settlement, Compromise or Consent to Judgments .

    (i)               No Non-Defending Party may compromise or settle or consent to the entry of judgment or determination of liability with respect to any Third Party Claim without the consent of the Defending Party.

    (ii)               Notwithstanding anything to the contrary herein, no Defending Party shall compromise, settle or consent to the entry of judgment or determination of liability concerning any Third Party Claim without providing at least 10 days’ prior written notice of such compromise, settlement or consent to the Indemnitor (if the Indemnitor is other than the Defending Party) and, if the terms of conditions of such compromise, settlement or consent would have a material adverse effect on the Non- Defending party without the consent of the Non-Defending Party (such approval not to be unreasonably withheld, delayed or conditioned).

    1.4        Additional Matters.

    (a)               Other Claims for Indemnification . Any claim in respect of a Liability which does not relate to, arise out of or result from a Third Party Claim shall be asserted by written notice from the Indemnitee to the Indemnifying Party stating the specific provisions of this Agreement or any Ancillary Agreement upon which such claim is based. Such Indemnifying Party shall have a period of twenty (20) days from actual receipt of the notice within which to respond thereto. If such Indemnifying Party does not respond within such 20-day period, then such Indemnifying Party shall be deemed to have denied responsibility for such claim.

    (b)               Subrogation . In the event of payment by or on behalf of any Indemnifying Party to or on behalf of any Indemnitee in connection with any Third Party Claim, such Indemnifying Party shall be subrogated to and shall stand in the place of such Indemnitee, in whole or in part based upon whether the Indemnifying Party has paid all or only part of the Indemnitee’s Liability, as to any events or circumstances in respect of which such Indemnitee may have any right, defense or claim relating to such Third Party Claim against any claimant or plaintiff asserting such Third Party Claim or against any other Person. Such Indemnitee shall cooperate with such Indemnifying Party in a reasonable manner, and at the cost and expense of such Indemnifying Party, in prosecuting any subrogated right, defense or claim.

    (c)               Effect of Insurance on Indemnification/Contribution Obligations . No Indemnitee shall be required to pursue any claim under any Insurance Policies of which it is a beneficiary in connection with any Liability for which such Indemnitee is entitled to indemnification hereunder. The amount of indemnification or contribution to which such Indemnitee may be entitled hereunder shall not be reduced as a result of any claim such Indemnitee may pursue, or have the right to pursue, under any Insurance Policy in respect of the Liability to which such right to indemnification or contribution relates, unless the Indemnitee shall have actually recovered any portion of such Liability from its insurance carrier(s), in which case, whether or not the amount of indemnification or contribution to such Indemnitee shall be reduced shall be determined in accordance with Sections 1.1(b) and 1.2(b), as applicable.

    [(d)               Not Applicable to Taxes . Notwithstanding anything to the contrary contained herein, this Agreement shall not apply to Taxes (which are covered by the Tax Agreement).]

    1.5         Survival of Indemnities . Subject to Section 5.4, the rights and obligations of the members of the Mestek Group and the Omega Group under this Article I shall survive the sale or other transfer by any party of any assets or businesses or the assignment by it of any Liabilities or the sale by any member of the Mestek Group or the Omega Group of the capital stock or other equity interests of any Subsidiary to any Person.

    2.1         Omega Insurance Coverage . Omega, and Omega alone, shall be responsible for obtaining and maintaining insurance programs for its risk of loss beginning on the Distribution and for all time periods thereafter. Such insurance arrangements shall be separate and apart from Mestek’s insurance programs. Mestek shall not be required to maintain any insurance coverage for the benefit of the members of the Omega Group or the directors, officers or employees of any member of the Omega Group for any period after the Distribution.

    2.2         Mestek Insurance Coverage . Mestek shall be responsible for obtaining and maintaining insurance programs for its risks of loss (a) for all of Mestek’s subsidiaries and businesses including Omega, for all time periods prior to the Distribution Date, and (b) for all of its subsidiaries and businesses excluding Omega from the Distribution Date and for all time periods thereafter.

    2.3         Cooperation and Agreement Not to Release Carriers . Each of Mestek and Omega will share such information as is reasonably necessary in order to permit the other to manage and conduct its insurance matters in an orderly fashion. Omega, at the request of Mestek, shall cooperate with and use commercially reasonable efforts to assist Mestek in recoveries for claims made under any Mestek Insurance Policy for the benefit of members of the Mestek Group. Neither Omega nor any of its Subsidiaries shall take any action which would intentionally jeopardize or otherwise interfere with the ability of any member of the Mestek Group to collect any proceeds payable pursuant to any insurance policy. Nothing in this Agreement shall be interpreted to require Mestek to maintain any insurance coverage for any Member of the Omega Group or any of their officers, directors or employees.

    2.4         No Liability . Omega does hereby, for itself and as agent for each other member of the Omega Group, agree that no member of the Mestek Group or any Mestek Indemnitee shall have any Liability whatsoever as a result of the insurance policies and practices of Mestek and its Subsidiaries as in effect at any time prior to the Distribution Date, including as a result of the level or scope of any such insurance, the creditworthiness of any insurance carrier, the terms and conditions of any policy, the adequacy or timeliness of any notice to any insurance carrier with respect to any claim or potential claim or otherwise.

    2.5         No Restrictions . Nothing in this Agreement shall be deemed to restrict any member of the Omega Group from acquiring at its own expense any other insurance policy in respect of any Liabilities or covering any period.

    2.6         Further Agreements . Omega, the members of the Omega Group, and the directors, officers and employees of any member of the Omega Group, shall not make any claims under Mestek Insurance Policies, including in respect of events that occurred when Omega and the members of the Omega Group were subsidiaries of Mestek, without Mestek’s approval, which may be granted or withheld in Mestek’s sole discretion.

    3.1        Mediation/Arbitration.

    4.1         Entire Agreement . This Agreement, the Distribution Agreement, the Ancillary Agreements and any exhibits and schedules attached hereto and thereto, constitutes the entire agreement among the parties with respect to the subject matter hereof and thereof and shall supersede all prior written and oral and all contemporaneous oral agreements and understandings with respect to the subject matter hereof and thereof.

    4.2         Governing Law; Forum . This Agreement shall be construed in accordance with the laws of the Commonwealth of Pennsylvania as to all matters regardless of the laws that might otherwise govern under principles of conflicts of laws applicable thereto. Under no circumstances may any party seek or be awarded punitive damages under this Agreement, the Distribution Agreement or the Ancillary Agreements.

    4.3         Notices . All notices and other communications required or permitted to be given by any party pursuant to the terms of this Agreement shall be in writing to and shall be deemed to have been duly given when delivered in person, by express or overnight mail delivery by a nationally recognized courier (delivery charges prepaid), or by registered or certified mail (postage prepaid, return receipt requested), as follows:

    if to Mestek:

Mestek, Inc.
260 North Elm Street
Westfield, MA 01085
Attention: President

    if to Omega:

Omega Flex, Inc.
451 Creamery Way
Exton, PA 19341
Attention: President

    or to such other address as the party to whom notice is given may have previously furnished to the other in writing in the manner set forth above. All notices and other communication shall be deemed to have been given and received on the date of actual delivery.

    4.4         Binding Effect; Assignment; Third-Party Beneficiaries . Omega may not, directly or indirectly, in whole or in part, whether by operation of law or otherwise, assign or transfer this Agreement or its rights or obligations hereunder, without Mestek’s prior written consent and, except as otherwise permitted hereby, any attempted assignment, transfer or delegation without such prior written consent shall be voidable at the sole option of Mestek. Nothing in this Agreement shall restrict any transfer of this Agreement by Mestek, whether by operation of law or otherwise. Without limiting the foregoing, this Agreement shall be binding upon Mestek and the other members of the Mestek Group and Omega and the other members of the Omega Group and inure solely to the benefit of the Omega Indemnitees and the Mestek Indemnitees and their respective legal representatives, successors and permitted assigns, and nothing in this Agreement, express or implied, is intended to confer upon any other Person any rights or remedies of any nature whatsoever under or by reason of this Agreement.

    4.5         Offset . In addition to, and not in limitation of, any other remedies any member of the Mestek Group or any Mestek Indemnitee may be entitled to under the Distribution Agreement, any Ancillary Agreement (including this Agreement), any member of the Mestek Group or any Mestek Indemnitee may satisfy any amounts owed to such member of the Mestek Group or Mestek Indemnitee by any member of the Omega Group by means of an offset against any amounts any member of the Mestek Group may from time to time owe to any member of the Omega Group or an Omega Indemnitee, whether under the Distribution Agreement, any Ancillary Agreement (including this Agreement), any other agreement or arrangement existing between any member of the Mestek Group and any member of the Omega Group, or otherwise.

    4.6         Counterparts . This Agreement, including any schedules and exhibits hereto, and the other documents referred to herein, may be executed in counterparts, each of which shall be deemed to be an original but all of which shall constitute one and the same agreement.

    4.7         Severability . If any term or other provision of this Agreement or any schedules or exhibits attached hereto is determined by a court, administrative agency or arbitrator to be invalid, illegal or incapable of being enforced by any rule of law or public policy, all other conditions and provisions of this Agreement will 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 hereto. Upon such determination that any term or other provision is invalid, illegal or incapable of being enforced, this Agreement shall be modified by such court, agency or arbitrator so as to effect the original intent of the parties hereto as closely as possible in an acceptable manner to the end that transactions contemplated hereby are fulfilled to the fullest extent possible.

    4.8         No Waiver . No failure or delay on the part of any party hereto in the exercise of any right hereunder shall impair such right or be construed to be a waiver of, or acquiescence in, any breach of any representation, warranty or agreement herein, nor shall any single or partial exercise of any such right preclude other or further exercise thereof or of any other right.

    4.9         Amendment . No change or amendment will be made to this Agreement except by an instrument in writing signed on behalf of each of the parties to this Agreement.

    4.10         Interpretation . The headings contained in this Agreement, in any Annex, Exhibit or Schedule hereto and in the table or contents to this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement. Any capitalized term used in any Annex, Schedule or Exhibit but not otherwise defined therein, shall have the meaning assigned to such term in this Agreement. When a reference is made in this Agreement to an Article or Section, or an Annex, Exhibit or Schedule, such reference shall be to an Article or Section of, or an Annex, Exhibit or Schedule to, this Agreement unless otherwise indicated.

    5.1         Action . “Action” means any claim, demand, action, suit, countersuit, arbitration, inquiry, proceeding or investigation by or before any federal, state, local, foreign or international governmental authority or any arbitration or mediation tribunal.

    5.2         Dispute . “Dispute” means a dispute arising from or in connection with the Distribution Agreement, this Agreement or any other Ancillary Agreement, whether based on contract, tort, or otherwise.

     5.3        Indemnitee. "Indemnitee" means a Mestek Indemnitee or an Omega Indemnitee.

    5.4         Indemnifying Party . “Indemnifying Party” means any party who is required to indemnify any other Person pursuant to this Agreement.

    5.5         Insurance Policies . “Insurance Policies” means insurance policies pursuant to which a Person makes a true risk transfer to an insurer.

    5.6         Liabilities . “Liabilities” means all debts, liabilities, guarantees, commitments and obligations, whether fixed, contingent or absolute, asserted or unasserted, matured or unmatured, liquidated or unliquidated, accrued or not accrued, known or unknown, due or to become due, whenever or however arising (including, without limitation, whether arising out of any contract or tort based on negligence or strict liability) and whether or not the same would be required by generally accepted accounting principles to be reflected in financial statements or disclosed in the notes thereto. For purposes of any indemnification hereunder, “Liabilities” shall be deemed also to include any and all damages, claims, suits, judgments, fines, penalties, costs and expenses of any kind or character, including attorney’s fees and expenses, out-of-pocket costs of investigation and preparation, expert witness costs and any other fees and expenses associated with the defense of any Action whether relating to Third Party Claims or Actions against the other party hereto.

    5.7         Material Adverse Effect . “Material Adverse Effect” means, with respect to either Group, a material adverse effect on the business, results of operations or financial conditions of the members of such Group, taken as a whole, provided that, without limiting the events, circumstances or conditions which may constitute or result in a Material Adverse Effect on the Mestek Group, any compromise, settlement or consent affecting the Mestek Group that, if applied to Omega or any member of the Omega Group, would result in a Material Adverse Effect on the Omega Group, shall be deemed to result in a Material Adverse Effect on the Mestek Group.

    5.8         Omega Business. "Omega Business" means (a) the business and operations of Omega.

    5.9         Omega Indemnitees . “Omega Indemnitees” means Omega, each member of the Omega Group and each of their respective directors, officers, employees, agents or representatives.

    5.10         Omega Liabilities . “Omega Liabilities” means, collectively, all of the Liabilities of Omega and each of the other members of the Omega Group, including without limitation:

    (a)               all of the Liabilities reflected on the financial statements of Omega;

    (b)               all Liabilities which are incurred or arise, or which accrue or exist out of, or in connection with, or otherwise relate to or result from, the Omega Business including without limitation any liabilities relating to employment practices, employee benefits, products or professional liability, violation or nonconformity with the environmental laws, rule or regulations, or employee health and safety;

    (c)               all Liabilities of each member of the Omega Group under, allocated to or to be retained or assumed by Omega or any of the other members of the Omega Group pursuant to the Distribution Agreement, this Agreement or any Ancillary Agreements.

    (d)               all of the Liabilities of any member of the Mestek Group or Omega Group (whenever arising whether prior to, on or following the Distribution Date) arising out of or in connection with or otherwise relating to the management or conduct of the Omega Business prior to, on, or following the Distribution Date;

    (e)               all Liabilities relating to, arising out of or resulting from (a) any Actions in which any member of the Omega Group has been named as a defendant by a plaintiff or by way of counter claim by a defendant in any Action as of the date of this Agreement or any amendments to such Actions (the “Existing Actions”), (b) any of the facts, circumstances and events giving rise to any Action relating to Omega, the Omega Business, or any liability of Omega or the Omega Business prior to, on or after the Distribution Date, and (c) any Actions involving similar claims or which are based upon similar facts, circumstances or events, whether involving the same parties or other parties, in each case whether relating to, arising out of or resulting from facts, circumstances or events prior to, on or after the Distribution Date;

    (f)               all Liabilities relating to, arising out of or resulting from, any Third Party Claim relating to, arising out of or resulting from any infringement or alleged infringement by Omega on any intellectual property or other rights of any Person;

    (g)               all liabilities arising out of or relating to any Taxes assessed, levied or claimed by any governmental authority or agency against Omega or relating to the Omega Business.

    (h)               all Securities Liabilities relating to, arising out of or resulting from (A) the Distribution and any documents, information or data (financial or otherwise) furnished or provided, orally or in writing, to purchasers or transferees or potential purchasers and transferees (or any of their respective representatives), in connection therewith or filed or furnished in connection therewith with or to any Governmental Authority or any securities exchange or securities market, including, without limitation, the Registration Statements, (B) any other offer, issuance, sale, exchange or other transfer of securities of or by Omega or any member of the Omega Group prior to, on or after the Distribution Date, or any documents, information or data (financial or otherwise) furnished or provided, orally or in writing, to transferees or purchasers or potential transferees or purchasers (or any of their respective representatives) of such securities or filed or furnished in connection therewith with or to any Governmental Authority or securities exchange or securities market, including, without limitation, any registration statement, (C) any oral or written disclosure made, whether or not included in documents filed with or furnished to any Governmental Authority or securities exchange or securities market, by Omega or any member of the Omega Group, or on behalf of Omega or any Member of the Omega Group, prior to, on or after the Distribution Date or any disclosure made (other than by a member of the Mestek Group), orally or in writing, of information or data (financial or otherwise) relating to or concerning Omega or any other member of the Omega Group, the business, operations and management of the Omega Business and/or Omega or any other member of the Omega Group, and (D) any oral or written disclosure made, whether or not included in documents filed with or furnished to any Governmental Authority or securities exchange or securities market, by Mestek or any member of the Mestek Group prior to, on or after the Distribution Date based on any information or data (financial or otherwise) provided by or on behalf of Omega or any member of the Omega Group; and

    (i)               all other Liabilities arising out of, relating to or resulting from any Action or Third Party Claim by any Governmental Authority or any other Person that is based on (A) any violations or alleged violations by Omega, its Subsidiaries and/or any of their respective directors, officers, employees, agents or representatives of any of the provisions of the Securities Act, the Exchange Act, or the rules and regulations of the Commission promulgated thereunder, any other securities or similar law or any other law, rule or regulation, or (B) any breach or alleged breach of fiduciary duty by the Omega Board or any Committee of the Omega Board (or any member of the Omega Board or any Committee thereof) or the board of directors or similar body or any Committee of the board of directors or similar body (or any member of any such board or similar body or any Committee thereof) of any other member of the Omega Group, or by any officer or employee of any member of the Omega Group.

    5.11         Mestek Indemnitees . “Mestek Indemnitees” means Mestek, each member of the Mestek Group and each of their respective directors, officers, employees, agents and representatives.

    5.12         Mestek Insurance Policy . “Mestek Insurance Policy” shall mean each Insurance Policy owned or maintained by a member of the Mestek Group.

    5.13         Mestek Liabilities. “Mestek Liabilities” means

    (a)               all Liabilities of any member of the Mestek Group under, allocated to or to be retained or assumed by Mestek or any of the other members of the Mestek Group pursuant to the Distribution Agreement, this Agreement or any other Ancillary Agreement;

    (b)               all Liabilities incurred by members of the Mestek Group in connection with the management or conduct prior to, on or following the Distribution Date of the Mestek Business.

    5.14         Securities Liabilities . “Securities Liabilities” means any and all losses, liabilities, penalties, claims, damages, demands, costs or expenses or other Liabilities whatsoever that are assessed, imposed, awarded against, incurred or accrued by a Person arising out of or relating in whole or in part to any Action, any potential or threatened Action, any Third Party Claim or any potential or threatened Third Party Claim by any Governmental Authority or any other Person that is based on any violations or alleged violations of the Securities Act, the Exchange Act, and any of the rules or regulations of the Commission promulgated under the Securities Act or Exchange Act, or any other securities or other similar laws, rules or regulations, including, without limitation, state securities or “blue sky” laws, rules or regulations, foreign securities laws, rules or regulations and rules or regulations of any securities exchange or market.

    5.15         Distribution Agreement. "Distribution Agreement" has the meaning set forth in the Recitals hereof.

    5.16         Subsidiary. "Subsidiary" has the meaning set forth in the Distribution Agreement.

    5.17         Taxes. "Taxes" has the meaning set forth in the Tax Agreement.

    5.18         Third Party Claim . “Third Party Claim” means an Action brought, asserted, commenced or pursued by a Person (including any Governmental Authority) other than a member of the Mestek Group or the Omega Group.

    5.19         Other Definitions . Any capitalized terms used but not defined herein shall have the meanings assigned to them in the Distribution Agreement.

MESTEK, INC.

By:_________________________________
Name:
Title:

OMEGA FLEX, INC.

By:_________________________________
Name:
Title:

    a.               Employee represents and warrants the following:

    i.     Employee possesses information regarding the designing, manufacturing, fabricating, assembling, buying and selling flexible metal hose products;

    ii.      To the best of Employee’s knowledge, such information is not information that is proprietary to any other person or entity; is not confidential information of any other person or entity; is not under any restriction, or subject to any non-disclosure agreement, that would prevent Employee from utilizing such information for the benefit of the Company; and is not the subject of a patent or patent application; and

    iii.      Employee is not aware of any restriction, or subject to any agreement, that would prevent him from accepting employment with the Company under the terms of this Agreement.

    b.               The Company represents and warrants the following:

    i.                      It has no desire or expectation that Employee provide to the Company or utilize in his performance under this Agreement, any information that is confidential or proprietary to any other person or entity;

    ii.               This Agreement and Employee’s appointment as an officer of the Company hereunder have been affirmed and ratified by all required corporate actions.

    a.               “Affiliate” of the Company (as hereinafter defined) shall mean any other Person controlling, controlled by, or under common control with the Company.

    b.               “Associated Company” of the Company shall mean any Affiliate of the Company, or any other Person in which the Company (or an Affiliate of the Company) holds an ownership interest of any size.

    c.               The “Company” shall mean Omega Flex, Inc., a Pennsylvania corporation;

    d.               “Confidential Information” shall mean any information relating directly or indirectly to the business of the Company and its Affiliates which is not generally known to the public and which the Company or its Affiliates protect as proprietary including inventions, improvements, concepts, structures, formulae, techniques, processes, apparata, know how, trade secrets, customer requirements, plans, records and data, and may also include customer lists and knowledge about the general business affairs of the Company; whether conveyed in written, graphic, aural, physical or electronic form; however, Confidential Information does not include information which Employee can demonstrate was known to or was in the possession of Employee prior to disclosure by the Company or its Affiliates, was generally available to the public or was otherwise part of the public domain after the time of disclosure to Employee by the Company or its Affiliates or became so through no act or omission of Employee, or was properly provided to Employee by an independent third party who has or had no obligation of secrecy to the Company or its Affiliates.

    e.               “Employee” shall mean Kevin R. Hoben, a resident of Connecticut.

    f.               “Person” shall mean any natural person or any corporation, partnership, joint venture, trust, firm or other entity, and

    g.               “Effective Date” shall mean the date first above written.

    a.               Performance of Job Duties . Employee is engaged for the initial period hereof as President of the Company to perform such duties and services as are reasonably related thereto. During the term of this Agreement, Employee shall devote his full time and attention and his best efforts to the conduct of the business of the Company and the performance of his duties under this Agreement, and shall not engage in any other business activity; provided that Employee shall not be prevented from investing his personal assets in such manner as will not require significant services on the part of Employee; and further provided, that such foregoing restriction shall not apply to Employee’s activities as a shareholder and employee of New Grind, Inc. d/b/a Coffee Beanery and its successors and assigns.

    b.               Service with parent of the Company . Employee shall also be appointed a Vice President of Mestek, Inc., the parent of the Company (“Mestek”).

    c.               Company’s Obligations . Except as provided in Section 9, the Company may not, without Employee’s prior consent, which shall not be unreasonably withheld:

    i.               terminate or demote Employee or otherwise detrimentally change, directly or indirectly, the stature of Employee’s position, including but not limited to, title, salary, bonus or other perquisites; or

    ii.               narrow the scope of Employee’s duties or otherwise detrimentally change Employee’s job description.

    iii.               change the location of Employee’s office and principal workplace outside a radius of fifty miles; however, Employee specifically acknowledges and agrees that travel to and work at the offices of the Company in Exton, Pennsylvania, and the businesses of vendors and customers will be required for the full and faithful performance of the duties and responsibilities hereunder.

    a.               Base Salary . During the term of this Agreement, the Company shall pay to Employee a gross base salary totaling One Hundred Five Thousand U.S. Dollars (U.S. $105,000.00) per annum. This base salary shall be payable in regular bi-weekly intervals and shall be subject to such withholding and other normal employee deductions as may be required by law. This base salary may be increased by the Company’s Board of Directors in their sole discretion. It is anticipated that the base salary will be reviewed by the Board of Directors on the anniversary of the effective date of this Agreement each year.

    b.               Additional Employee Benefits and Perquisites . In addition to the annual base salary, Employee shall receive all benefits and perquisites of current Company employees, as may be determined from time to time by the Company’s Board of Directors or its designee, but not limited to:

    i.               Bonus Plan . During the term of this Agreement, the Company will offer Employee participation in a bonus program as set forth in Exhibit A attached hereto.

    ii.               Stock Options . During the term of this Agreement, the Company will, upon the affirmative vote of its shareholder, offer Employee the opportunity to participate in the Omega Flex 1996 Stock Option Plan substantially in the form of Exhibit B attached hereto, whereby, pursuant to a written option agreement substantially in the form of Exhibit C attached hereto, Employee will be granted options to purchase up to ten percent (10%) of the common stock of the Company exerciseable at the equivalent price paid by Mestek in its acquisition of the stock of the Company on February 2, 1996, and the right to purchase such shares shall vest in five (5) equal annual increments beginning upon the third anniversary of the grant thereof. Employee and the Company shall execute a Shareholder Agreement substantially in the form of Exhibit D attached hereto.

    iii.               Benefits . Employee shall be eligible to participate during the term of this Agreement in such life insurance, health, dental, short- and long-term disability and medical insurance benefits, pension, and such other employee benefit plans and programs for the benefit of the employees of the Company, as may be maintained from time to time, in each case to the extent and in the manner available to other executive officers of the Company, and subject to the terms and provisions of such plan or programs.

    iv.               Vacation . Employee shall be entitled to twenty (20) days of paid vacation during each calendar year and to all paid holidays of the Company.

    v.               Expenses . The Company shall reimburse Employee for reasonable out-of-pocket expenses incurred by Employee in connection with the business of the Company and in performance of his duties under this Agreement, upon his presentation to the Company of an itemized accounting of such expenses with reasonable supporting data, subject, however, to the Company’s policies relating to business-related expenses as in effect from time to time.

    vi.               Automobile . The Company will lease or purchase for the use of Employee in the performance of his duties and responsibilities under this Agreement an automobile comparable in price and features to a Buick Park Avenue.

    c.               Signing Bonus . Employee shall be paid a signing bonus of Four Thousand Dollars ($4,000.00).

    a.               Confidentiality . Employee acknowledges that during the course of his employment with the Company he will, from time to time, be invested with Confidential Information relating to the business practices of the Company, Associated Companies of the Company, and customers of the Company. Employee hereby agrees to keep all Confidential Information confidential. Employee also agrees that he will not, except as required in the conduct of Company business, or as authorized in writing by the Company, publish, disclose or make use of, for his or any third party’s benefit or account, any Confidential Information unless and until such Confidential Information shall have ceased to be secret or confidential due to no act or omission on his part.

    b.               Exclusive Property . Employee confirms that all Confidential Information is the exclusive property of the Company. All Confidential Information, including without limitation, business records, papers and other documents kept or made by Employee relating to the business of the Company or an Associated Company shall be and remain the property of the Company or the Associated Company. Upon the termination of his employment with the Company or upon the request of the Company at any time, Employee shall promptly deliver to the Company, and shall retain no copies of, any Confidential Information, including without limitation, any written materials, records and documents made by Employee or coming into his possession concerning the business or affairs of the Company or an Associated Company other than personal notes or correspondence of Employee not containing Confidential Information relating to such business or affairs.

    c.               Exceptions for Governmental or Judicial Orders . Employee shall have no liability under this Section 6 due to his disclosure of Confidential Information made pursuant to judicial or governmental order, provided Employee (if allowed under applicable law) notifies the Company as soon as possible and in any event prior to such disclosure cooperates with the Company in the event the Company elects to legally contest and avoid such disclosure. The Company shall defend Employee and indemnify him from any and all damages, losses, causes of action and costs, including reasonable attorneys’ fees incurred by him as a result of the Company’s actions to legally contest and avoid any such disclosure.

    d.               Survival of Section . The provisions of this Section 6 shall survive the termination of this Agreement for any reason whatsoever.

    a.               Exclusivity / Non-Competing Employment . For the term of this Agreement and a period of one (1) year following expiration of this Agreement or the earlier termination thereof as provided in Section 9 (the “Restricted Period”), Employee shall not, unless he receives the prior written consent of the Company, directly or indirectly, own an interest in, manage, operate, join, control, lend money or render financial or other assistance to or participate in or be connected with, as an officer, employee, partner, stockholder, consultant or otherwise, any individual, partnership, firm, corporation or other business organization or entity that at such time is engaged in the same type of business as the Company, and Employee shall not, whether for his own account or for the account of any other individual, partnership, firm, corporation or other business organization, intentionally solicit, endeavor to entice away from the Company or an Associated Company, or otherwise interfere with the relationship of the Company or an Associated Company with any person or entity who is, or was within the most recent twelve-month period, a customer or client of the Company or an Associated Company.

    b.               No Interference . For the term of this Agreement and a period of three (3) years following expiration of this Agreement or the earlier termination thereof as provided in Section 9, Employee shall not, whether for his own account or for the account of any other individual, partnership, firm, corporation or other business organization, intentionally solicit, endeavor to entice away from the Company or an Associated Company, or otherwise interfere with the relationship of the Company or an Associated Company with any person who is employed by the Company or an Associated Company.

    c.               Stock Ownership . Nothing in this Agreement shall prohibit Employee from acquiring or holding any securities of any company listed on a national securities exchange or quoted on the automated quotation system of the National Association of Securities Dealers, Inc., provided that at any time during the Restricted Period Employee and members of his immediate family do not own more than five percent (5%) of any voting securities of any company engaged in the same type of business as the Company.

    d.               Territorial Scope . The prohibitions in Sections 7(a) and 7(b) shall extend to any place where the Company is doing business on the first day of the Restricted Period.

    e.               Survival of Section . The provisions of this Section 7 shall survive the termination of this Agreement for any reason whatsoever.

    a.               Specific Performance . Employee hereby acknowledges that a breach of Sections 6 or 7 of this Agreement may result in material irreparable injury to the Company for which there in no adequate remedy at law, that it will not be possible to measure damages for such a breach, and that in the event of such a breach or threat thereof the Company shall be entitled to obtain a temporary restraining order, a preliminary injunction, a permanent injunction or other equitable relief restraining Employee from engaging in activities prohibited by this Agreement. Employee further acknowledges that in the event of such a breach or threat thereof the Company shall be entitled to obtain such other or further relief as may be required to specifically enforce any of the covenants of this Agreement. Employee hereby agrees and consents that such injunctive or other relief may be sought in any state or federal court of competent jurisdiction in the County of Chester, Commonwealth of Pennsylvania, or in the state and county in which such violation may occur or in any other court having jurisdiction, at the election of the Company. Employee agrees to and hereby does submit to in personam Jurisdiction before each and every such court for that purpose.

    b.               Suspension of Payments . Employee hereby acknowledges that should an alleged breach of Sections 6 or 7 of this Agreement occur, the Company is entitled to suspend any payments due to Employee during litigation of any action it may bring against Employee for injunctive and/or monetary relief; however, in the event that the Company does not prevail in such litigation, it shall owe Employee double the amount of the payments that were suspended.

    c.               Remedies not Exclusive . The remedies of this Section shall be cumulative and not exclusive, and shall be in addition to any other remedy which the company may have.

    d.               Survival of Remedies . This Section 8 shall survive the termination of this Agreement for any reason whatsoever.

    a.               Termination by Employee Without Cause . Employee may terminate this Agreement without Cause (as hereinafter defined) prior to the expiration of this Agreement, by sending written notice of such termination at least three (3) months in advance of the effective date of such termination. If Employee elects to terminate this Agreement pursuant to this Section 9(a), he shall not be entitled to any compensation or benefits after the effective date of his termination other than any bonus earned, but not yet paid, under this Agreement.

    b.               Termination by the Company for Cause . The Company may terminate the Agreement and Employee’s employment with Cause prior to the expiration of this Agreement, by sending Employee written notice of such termination for Cause. The date of such notice shall be the effective date of the termination of this Agreement. If the Company terminates Employee’s employment for Cause, Employee shall receive a severance payment in an amount equal to one-twelfth his annual base salary at the rate effective on the date of termination payable within thirty (30) days of such termination. For purposes of this Agreement, “Cause” shall mean (1) dishonesty or fraud resulting in damage to the business of the Company or its Affiliates; (2) embezzlement or theft of assets of the Company or any of its Affiliates; (3) competing with the Company or aiding a competitor of the Company or any of its Affiliates to the detriment of the Company or any of its Affiliates; (4) a substantial breach of this Agreement; (5) conviction for a felony resulting in damage to the business of the Company or its Affiliates; or (6) any other willful misconduct by Employee which is materially injurious to the Company, monetarily or otherwise. If the Company terminates this Agreement and Employee’s employment for Cause, he shall not be entitled to any compensation or benefits after the effective date of his termination other than any bonus earned, but not yet paid, under this Agreement.

    c.               Later Employment With Successor in interest of Company . Employee shall not be deemed to have been terminated under this Agreement if he is offered employment on substantially the same or better terms by any Affiliate, successor in interest or assign of the Company, or by any purchaser of substantially all of the Company’s assets. In the event that Employee chooses not to accept to such employment, Mestek shall offer employment on equivalent terms to Employee.

    d.               Company’s Rights and Obligations Upon Election Not to Extend Agreement . If the Company elects not to extend the Agreement or any extension thereof as provided for in Section 4, the Agreement will terminate upon the expiration of the term or as otherwise agreed in writing by the parties. Upon the effective date of termination of this Agreement whether at the end of the term or upon mutual agreement of the parties, Employee’s employment with the Company shall terminate, and Employee shall receive severance payments in an amount equal to his annual base salary at the rate in effect on the date of termination payable in twenty-six (26) equal bi-weekly installments, and continued use of the automobile described herein and extension without cost of the medical and dental programs in which Employee for a period of one year after such termination.

    e.               Death . Notwithstanding anything to the contrary herein contained, Employee’s employment and this Agreement shall terminate upon his death and neither he nor his heirs shall be entitled to any compensation or benefits under this Agreement after the effective date of his termination other than (i) any bonus earned, but not yet paid, under this Agreement, and (ii) any rights under the Omega Flex 1996 Stock Option Plan or as a shareholder of the Company, if any.

    f.               Delivery of Material . Employee agrees that upon the termination of this Agreement he will deliver to the Company all documents, papers, materials and other property of the Company relating to its affairs which may then be in his possession or under his control including Confidential Information.

    Mestek        shall indemnify Employee for any and all acts and omissions to act made during the term of this Agreement in his capacity both as an officer of the Company and of Mestek, and Employee’s personal liability for such acts and omissions shall be limited, to the fullest extent permitted by the laws of the Commonwealth of Pennsylvania, as the same may be amended and supplemented. This Section 10 shall survive the termination of this Agreement for any reason whatsoever.

Omega Flex, Inc.
451 Creamery Way
Exton, Pennsylvania 19341-2509

    a.        Maximize equivalent hydraulic diameter

    b.        Refine hose to fitting interface

    c.        Meet established bend diameter requirements

    a.               Employee represents and warrants the following:

    i.               Employee possesses information regarding the designing, manufacturing, fabricating, assembling, buying and selling flexible metal hose products;

    ii.               To the best of Employee’s knowledge, such information is not information that is proprietary to any other person or entity; is not confidential information of any other person or entity; is not under any restriction, or subject to any non-disclosure agreement, that would prevent Employee from utilizing such information for the benefit of the Company; and is not the subject of a patent or patent application; and

    iii.               Employee is not aware of any restriction, or subject to any agreement, that would prevent him from accepting employment with the Company under the terms of this Agreement.

    b.               The Company represents and warrants the following:

    i.               It has no desire or expectation that Employee provide to the Company or utilize in his performance under this Agreement, any information that is confidential or proprietary to any other person or entity;

    ii.               This Agreement and Employee’s appointment as an officer of the Company hereunder have been affirmed and ratified by all required corporate actions.

    a.               “Affiliate” of the Company (as hereinafter defined) shall mean any other Person controlling, controlled by, or under common control with the Company.

    b.               “Associated Company” of the Company shall mean any Affiliate of the Company, or any other Person in which the Company (or an Affiliate of the Company) holds an ownership interest of any size.

    c.               The “Company” shall mean Omega Flex, Inc., a Pennsylvania corporation;

    d.               “Confidential Information” shall mean any information relating directly or indirectly to the business of the Company and its Affiliates which is not generally known to the public and which the Company or its Affiliates protect as proprietary including inventions, improvements, concepts, structures, formulae, techniques, processes, apparata, know how, trade secrets, customer requirements, plans, records and data, and may also include customer lists and knowledge about the general business affairs of the Company; whether conveyed in written, graphic, aural, physical or electronic form; however, Confidential Information does not include information which Employee can demonstrate was known to or was in the possession of Employee prior to disclosure by the Company or its Affiliates, was generally available to the public or was otherwise part of the public domain after the time of disclosure to Employee by the Company or its Affiliates or became so through no act or omission of Employee, or was properly provided to Employee by an independent third party who has or had no obligation of secrecy to the Company or its Affiliates.

    e.               “Employee” shall mean Mark F. Albino, a resident of Massachusetts.

    f.               “Person” shall mean any natural person or any corporation, partnership, joint venture, trust, firm or other entity, and

    g.               “Effective Date” shall mean the date first above written.

    a.               Performance of Job Duties . Employee is engaged as Senior Vice President-Manufacturing & Engineering Services of the Company to perform such duties and services as are reasonably related thereto. During the term of this Agreement, Employee shall devote his full time and attention and his best efforts to the conduct of the business of the Company and the performance of his duties under this Agreement, and shall not engage in any other business activity; provided that Employee shall not be prevented from investing his personal assets in such manner as will not require significant services on the part of Employee.

    b.                Company’s Obligations.

    i.               Except as provided in Section 9, the Company may not, without Employee’s prior consent, which shall not be unreasonably withheld, directly or indirectly, narrow the scope of Employee’s duties or otherwise detrimentally change Employee’s job description.

    ii.               Change the location of Employee’s office and principal workplace outside a radius of fifty miles; however, Employee specifically acknowledges and agrees that travel to and work at the offices of the Company in Exton, Pennsylvania, and the businesses of vendors and customers will be required for the full and faithful performance of the duties and responsibilities hereunder.

    a.               Base Salary . During the term of this Agreement, the Company shall pay to Employee a gross base salary totaling Eighty-Five Thousand U.S. Dollars (U.S. $85,000.00) per annum. This base salary shall be payable in regular bi-weekly intervals and shall be subject to such withholding and other normal employee deductions as may be required by law. This base salary may be increased by the Company’s Board of Directors in their sole discretion. It is anticipated that the base salary will be reviewed by the Board of Directors on the anniversary of the effective date of this Agreement each year.

    b.               Additional Employee Benefits and Perquisites . In addition to the annual base salary, Employee shall receive all benefits and perquisites of current Company employees, as may be determined from time to time by the Company’s Board of Directors or its designee, but not limited to:

    i.               Bonus Plan . During the term of this Agreement, the Company will offer Employee participation in a bonus program as set forth in Exhibit A attached hereto.

    ii.               Stock Options . During the term of this Agreement, the Company will, upon the affirmative vote of its shareholder, offer Employee the opportunity to participate in the Omega Flex 1996 Stock Option Plan substantially in the form of Exhibit B attached hereto, whereby, pursuant to a written option agreement substantially in the form of Exhibit C attached hereto, Employee will be granted options to purchase up to four percent (4%) of the common stock of the Company exerciseable at the equivalent price paid by Mestek in its acquisition of the stock of the Company on February 2, 1996, and the right to purchase such shares shall vest in five (5) equal annual increments beginning upon the third anniversary of the grant thereof. Employee and the Company shall execute a Shareholder Agreement substantially in the form of Exhibit D attached hereto.

    iii.               Benefits . Employee shall be eligible to participate during the term of this Agreement in such life insurance, health, dental, disability and medical insurance benefits, pension, and such other employee benefit plans and programs for the benefit of the employees of the Company, as may be maintained from time to time, in each case to the extent and in the manner available to other executive officers of the Company, and subject to the terms and provisions of such plan or programs.

    iv.               Vacation . Employee shall be entitled to fifteen (15) days of paid vacation during each calendar year and to all paid holidays of the Company.

    v.               Expenses . The Company shall reimburse Employee for reasonable out-of-pocket expenses incurred by Employee in connection with the business of the Company and in performance of his duties under this Agreement, upon his presentation to the Company of an itemized accounting of such expenses with reasonable supporting data, subject, however, to the Company’s policies relating to business-related expenses as in effect from time to time.

    c.               Signing Bonus . Employee shall be paid a signing bonus of Three Thousand Dollars ($3,000.00).

    a.               Confidentiality . Employee acknowledges that during the course of his employment with the Company he will, from time to time, be invested with Confidential Information relating to the business practices of the Company, Associated Companies of the Company, and customers of the Company. Employee hereby agrees to keep all Confidential Information confidential. Employee also agrees that he will not, except as required in the conduct of Company business, or as authorized in writing by the Company, publish, disclose or make use of, for his or any third party=s benefit or account, any Confidential Information unless and until such Confidential Information shall have ceased to be secret or confidential due to no act or omission on his part.

    b.               Exclusive Property . Employee confirms that all Confidential Information is the exclusive property of the Company. All Confidential Information, including without limitation, business records, papers and other documents kept or made by Employee relating to the business of the Company or an Associated Company shall be and remain the property of the Company or the Associated Company. Upon the termination of his employment with the Company or upon the request of the Company at any time, Employee shall promptly deliver to the Company, and shall retain no copies of, any Confidential Information, including without limitation, any written materials, records and documents made by Employee or coming into his possession concerning the business or affairs of the Company or an Associated Company other than personal notes or correspondence of Employee not containing Confidential Information relating to such business or affairs.

    c.               Exceptions for Governmental or Judicial Orders . Employee shall have no liability under this Section 6 due to his disclosure of Confidential Information made pursuant to judicial or governmental order, provided Employee (if allowed under applicable law) notifies the Company as soon as possible and in any event prior to such disclosure cooperates with the Company in the event the Company elects to legally contest and avoid such disclosure. The Company shall defend Employee and indemnify him from any and all damages, losses, causes of action and costs, including reasonable attorneys’ fees, incurred by him as a result of the Company’s actions to legally contest and avoid any such disclosure.

    d.               Survival of Section . The provisions of this Section 6 shall survive the termination of this Agreement for any reason whatsoever.

    a.               Exclusivity / Non-Competing Employment . For the term of this Agreement and a period of one (1) year following expiration of this Agreement or the earlier termination thereof as provided in Section 9 (the “Restricted Period”), Employee shall not, unless he receives the prior written consent of the Company, directly or indirectly, own an interest in, manage, operate, join, control, lend money or render financial or other assistance to or participate in or be connected with, as an officer, employee, partner, stockholder, consultant or otherwise, any individual, partnership, firm, corporation or other business organization or entity that at such time is engaged in the flexible metal hose business as the Company, and Employee shall not, whether for his own account or for the account of any other individual, partnership, firm, corporation or other business organization, intentionally solicit, endeavor to entice away from the Company or an Associated Company, or otherwise interfere with the relationship of the Company or an Associated Company with any person or entity who is, or was within the most recent twelve-month period, a customer or client of the Company or an Associated Company.

    b.               No Interference . For the term of this Agreement and a period of three (3) years following expiration of this Agreement or the earlier termination thereof as provided in Section 9, Employee shall not, whether for his own account or for the account of any other individual, partnership, firm, corporation or other business organization, intentionally solicit, endeavor to entice away from the Company or an Associated Company, or otherwise interfere with the relationship of the Company or an Associated Company with any person who is employed by the Company or an Associated Company.

    c.               Stock Ownership . Nothing in this Agreement shall prohibit Employee from acquiring or holding any securities of any company listed on a national securities exchange or quoted on the automated quotation system of the National Association of Securities Dealers, Inc., provided that at any time during the Restricted Period Employee and members of his immediate family do not own more than five percent (5%) of any voting securities of any company engaged in the same type of business as the Company.

    d.               Territorial Scope . The prohibitions in Sections 7(a) and 7(b) shall extend to any place where the Company is doing business on the first day of the Restricted Period.

    e.               Survival of Section . The provisions of this Section 7 shall survive the termination of this Agreement for any reason whatsoever.

    a.               Specific Performance . Employee hereby acknowledges that a breach of Sections 6 or 7 of this Agreement may result in material irreparable injury to the Company for which there in no adequate remedy at law, that it will not be possible to measure damages for such a breach, and that in the event of such a breach or threat thereof the Company shall be entitled to obtain a temporary restraining order, a preliminary injunction, a permanent injunction or other equitable relief restraining Employee from engaging in activities prohibited by this Agreement. Employee further acknowledges that in the event of such a breach or threat thereof the Company shall be entitled to obtain such other or further relief as may be required to specifically enforce any of the covenants of this Agreement. Employee hereby agrees and consents that such injunctive or other relief may be sought in any state or federal court of competent jurisdiction in the County of Chester, Commonwealth of Pennsylvania, or in the state and county in which such violation may occur or in any other court having jurisdiction, at the election of the Company. Employee agrees to and hereby does submit to in personam Jurisdiction before each and every such court for that purpose.

    b.               Suspension of Payments . Employee hereby acknowledges that should an alleged breach of Sections 6 or 7 of this Agreement occur, the Company is entitled to suspend any payments due to Employee during litigation of any action it may bring against Employee for injunctive and/or monetary relief; however, in the event that the Company does not prevail in such litigation, it shall owe Employee double the amount of the payments that were suspended.

    c.               Remedies not Exclusive . The remedies of this Section shall be cumulative and not exclusive, and shall be in addition to any other remedy which the company may have.

    d.               Survival of Remedies . This Section 8 shall survive the termination of this Agreement for any reason whatsoever.

    a.               Termination by Employee Without Cause . Employee may terminate this Agreement without Cause (as hereinafter defined) prior to the expiration of this Agreement, by sending written notice of such termination at least three (3) months in advance of the effective date of such termination. If Employee elects to terminate this Agreement pursuant to this Section 9(a), he shall not be entitled to any compensation or benefits after the effective date of his termination other than any bonus earned, but not yet paid, under this Agreement.

    b.               Termination by the Company for Cause . The Company may terminate the Agreement and Employee’s employment with Cause prior to the expiration of this Agreement, by sending Employee written notice of such termination for Cause. The date of such notice shall be the effective date of the termination of this Agreement. If the Company terminates Employee’s employment for Cause, Employee shall receive a severance payment in an amount equal to one-twelfth his annual base salary at the rate effective on the date of termination payable within thirty (30) days of such termination. For purposes of this Agreement, “Cause” shall mean (1) dishonesty or fraud resulting in damage to the business of the Company or its Affiliates; (2) embezzlement or theft of assets of the Company or any of its Affiliates; (3) competing with the Company or aiding a competitor of the Company or any of its Affiliates to the detriment of the Company or any of its Affiliates; (4) a substantial breach of this Agreement; (5) conviction for a felony resulting in damage to the business of the Company or its Affiliates; or (6) any other willful misconduct by Employee which is materially injurious to the Company, monetarily or otherwise. If the Company terminates this Agreement and Employee’s employment for Cause, he shall not be entitled to any compensation or benefits after the effective date of his termination other than any bonus earned, but not yet paid, under this Agreement.

    c.               Later Employment With Successor in interest of Company . Employee shall not be deemed to have been terminated under this Agreement if he is offered employment on substantially the same or better terms by any Affiliate, successor in interest or assign of the Company, or by any purchaser of substantially all of the Company’s assets.

    d.               Company’s Rights and Obligations Upon Election Not to Extend Agreement . If the Company elects not to extend the Agreement or any extension thereof as provided for in Section 4, the Agreement will terminate upon the expiration of the term or as otherwise agreed in writing by the parties.

    e.               Death . Notwithstanding anything to the contrary herein contained, Employee’s employment and this Agreement shall terminate upon his death and neither he nor his heirs shall be entitled to any compensation or benefits under this Agreement after the effective date of his termination other than (i) any bonus earned, but not yet paid, under this Agreement, and (ii) any rights under the Omega Flex 1996 Stock Option Plan or as a shareholder of the Company, if any.

    f.               Delivery of Material . Employee agrees that upon the termination of this Agreement he will deliver to the Company all documents, papers, materials and other property of the Company relating to its affairs which may then be in his possession or under his control.

     If to the Company:

Omega Flex, Inc.
451 Creamery Way
Exton, Pennsylvania 19341-2509

     With a copy to:

R. Bruce Dewey, Esq.
Mestek, Inc.
260 North Elm Street
Westfield, MA 01085

     If to Employee:

Mark F. Albino
P.O. Box 347
Belchertown, Massachusetts 01007

    a.               Agreement is Non-Assignable . This Agreement is a personal service contract and shall not be assignable by Employee or by the company, except that the Company may assign this Agreement to a Person which succeeds to the Company’s rights and liabilities by merger, sale of assets as a going concern, or consolidation with the Company.

    b.               Binding Effect . All rights and obligations and agreements of the parties under this Agreement shall be binding upon and enforceable against, and inure to the benefit of the parties and their personal representatives, heirs, legatees and devises, and any Person succeeding by operation of law to their rights under this Agreement, except that such personal representatives, heirs, legatees, devises and other persons shall have no obligation to perform Employee’s duties described in section 3 hereof .

    c.               Representations . Employee and the Company each represent and warrant that there are no restrictions, agreements or limitations on their rights or ability to enter into and perform the terms of this Agreement.

    d.               Further Assurances , Employee and the Company, as the case may be, shall execute and deliver such further instruments and do such further acts and things as may be required to carry out the terms or conditions of this Agreement or as may be consistent with the intent and purpose of this Agreement.

    e.               Rights of Third Parties . Nothing in this Agreement, expressed or implied, is intended to confer upon any person other than the parties hereto any rights or remedies under or by reason of this Agreement.

    f.               Effect of Waiver . A Waiver of, or failure to exercise, any rights provided for in this Agreement, in any respect, shall not be deemed a waiver of any further or future rights hereunder. Except for rights which must be exercised within a specified time period under this Agreement, no rights herein shall be considered as waived, whether intentionally or not, unless waived in a writing signed by the party to be charged with the waiver.

    g.               Governing Law . This Agreement shall be governed by, and construed in accordance with, the laws of the Commonwealth of Pennsylvania applicable to contracts made and performed in that jurisdiction, without regard to the principles of conflicts of laws.

    h.               Amendments . This Agreement may not be changed or amended orally, but only by an agreement in writing signed by all parties hereto.

    i.               Counterparts . This Agreement may be executed in several counterparts, each of which shall be an original, and such counterparts shall together constitute but one and the same instrument.

    j.               Severability . If a court of competent jurisdiction declares that any term or provision of this Agreement is invalid or unenforceable, then:

    i.                      the remaining terms and provisions hereof shall be unimpaired, and

    ii.               the invalid or unenforceable term or provision shall be deemed replaced by a term or provision that is valid and enforceable and that comes closest to expressing the intention of the invalid or unenforceable term or provision.

    k.               Entire Agreement . This Agreement supersedes all prior agreements, oral or written, between the parties hereto with respect to the employment of Employee by the Company. This Agreement contains the entire agreement of the parties with respect to the employment of Employee by the Company, and the parties shall not be bound by any terms, conditions, statements, covenants, representations or warranties, oral or written, not herein contained.

    a.        Maximize equivalent hydraulic diameter

    b.        Refine hose to fitting interface

    c.        Meet established bend diameter requirements