EXHIBIT 10.1

EXECUTION COPY

STOCK PURCHASE AGREEMENT

THIS STOCK PURCHASE AGREEMENT (this “ Agreement ”), dated as of February 11, 2016, is made by and among Aerex Industries, Inc., a Florida corporation (the “ Company ”); Thomas Donnick, Jr. (the “ Seller ”); and Consolidated Water U.S. Holdings, Inc., a Florida corporation (the “ Buyer ).

RECITALS

A.           The Seller owns all of the outstanding capital stock of the Company.

B.           The Buyer desires to purchase from the Seller, and the Seller desires to sell to Buyer, 2,550 shares of Common Stock of the Company, which constitute fifty one percent (51%) of all the outstanding capital stock of the Company, subject to the terms and conditions set forth in this Agreement.

NOW, THEREFORE, in consideration of the mutual covenants contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby agree as follows:

Article I
PURCHASE AND SALE

Section 1.01          Purchase of the Purchased Shares . Subject to and upon the terms and conditions of this Agreement, the Buyer shall purchase from the Seller and the Seller shall sell to the Buyer, all of his right, title and interest in and to 2,550 shares of Common Stock of the Company, which shares shall constitute in the aggregate fifty one percent (51%) of all the outstanding capital stock of the Company immediately prior to the Closing, on a fully diluted basis (collectively, the “ Purchased Shares ”), for the consideration specified in Section 1.02 below and in reliance on the parties’ other agreements and representations herein.

Section 1.02          Purchase Price . The purchase price (the “ Closing Date Purchase Price ”) to be paid by the Buyer to the Seller at the Closing for all of the Purchased Shares shall consist of Seven Million One Hundred Forty Thousand Dollars ($7,140,000.00) plus the Estimated Net Working Capital Payment. The Closing Date Purchase Price shall be paid by Buyer at Closing to the Seller by wire transfer of immediately available funds to the account specified on Exhibit A attached hereto. The Closing Date Purchase Price is subject to adjustment after Closing as set forth in Section 2.04 below.

Article II
THE CLOSING; CLOSING ADJUSTMENT

Section 2.01          The Closing . The closing of the purchase and sale of the Purchased Shares (the “ Closing ”) shall take place on the date first written above or at such other time or date as the parties hereto agree. The date of Closing is hereinafter referred to as the “ Closing Date .”

Section 2.02          Conditions to the Buyer’s Obligation to Close . The obligations of the Buyer to consummate and effect this Agreement and the transactions contemplated hereby shall be subject to the satisfaction, at or prior to the Closing, of each of the following conditions to the satisfaction of the Buyer:

(a)           The Seller shall have delivered an Employment Agreement, in the form attached hereto as Exhibit B (the “ Employment Agreement ”), and a Confidentiality, Non-Compete, Non-Solicitation and Invention Assignment Agreement, in the form attached hereto as Exhibit C , each duly executed by the Seller (the “ Confidentiality Agreement ”).

(b)           The Seller shall have delivered to the Buyer a certificate or certificates representing the Purchased Shares, accompanied by a stock power or powers duly endorsed to the Buyer.

(c)           The Company shall have delivered to the Buyer certificates of status from the Florida Secretary of State office, dated no more than five (5) Business Days prior to the Closing Date.

(d)           Except for Donnick, all of the directors of the Company shall have submitted letters of resignation to the Buyer, with such resignations effective as of the Closing.

(e)           Possession of, or access to, all originals (or copies if the originals are not available) of agreements, instruments, documents, deeds, books, records, minute books, files and other data and information within the possession of the Company or any of its Affiliates belonging to the Company, as of the Closing Date, whether in paper or electronic form (collectively, the “ Records ”); provided, however, that Seller may retain (1) copies of any Records that the Seller is reasonably likely to need for complying with Laws; and (2) copies of any Records that in the reasonable opinion of the Seller will be required in connection with the performance of the Seller’s obligations hereunder.

(f)           All consents waivers and approvals necessary or desirable to effectuate the transactions contemplated herein.

(g)           Estoppel certificates duly and properly executed by all landlords and/or sublandlords with respect to any leased Real Property, in form and substance satisfactory to Buyer.

(h)           The Seller and the Company shall have executed and delivered to the Buyer the Shareholders’ Agreement with Buyer in the form attached hereto as Exhibit D (the “ Shareholders’ Agreement ”).

(i)           All loans and advances payable by the Company to banks, lenders or any other creditors (the “ Creditors ”) shall be fully repaid, and the Seller shall provide evidence of such repayments from the Creditors in a form satisfactory to the Buyer.

(j)           The bylaws of the Company shall be in such form as are acceptable to the Buyer and the Seller.

(k)           The Company shall have executed and delivered the services agreement with Aquilex, Inc. attached hereto as Exhibit E (the “ Services Agreement ”).

(l)           All of the certifications from the American Society of Mechanical Engineers that the Company holds as of the Closing Date shall have been renewed for a term of three years from the required renewal date, and any such certifications that are set to expire prior to June 30, 2016 shall been renewed early, if permitted to be renewed early, for a term of three years from the next renewal date.

(m)           Completion of an audit of the Company’s financial statements for fiscal year 2014 by Marcum LLP, at the Buyer’s expense.

(n)           The Seller shall have loaned the Company Four Hundred Ninety Thousand Dollars ($490,000), and the Company shall have executed and delivered to the Seller a term promissory note, in the form attached hereto as Exhibit F (the “ Promissory Note ”).

Section 2.03          Conditions to the Seller’s Obligation to Close . The obligations of the Seller to consummate and effect this Agreement and the transactions contemplated hereby shall be subject to the satisfaction, at or prior to the Closing, of each of the following conditions to the satisfaction of the Seller:

(a)           The Buyer shall pay the Closing Date Purchase Price in immediately available funds to the Seller.

(b)           The Company shall have delivered the Employment Agreement, the Confidentiality Agreement and the Services Agreement, each duly executed by the Company.

(c)           The Buyer and the Company shall have executed and delivered to the Seller the Shareholders’ Agreement.

(d)           Consolidated Water Co. Ltd. (“Parent”) shall have executed and delivered a guaranty of Buyer’s obligations under Section 3.01 of this Agreement in form and substance acceptable to Seller.

(e)           All consents waivers and approvals necessary or desirable to effectuate the transactions contemplated herein.

(f)           The bylaws of the Company shall be in such form as are acceptable to the Buyer and the Seller.

(g)           Parent shall have loaned the Company Five Hundred Ten Thousand Dollars ($510,000), and the Company shall have executed and delivered to Parent the Promissory Note.

Section 2.04          Closing Estimates; Final Purchase Price .

(a)           Closing Adjustment . At least three Business Days prior to the Closing, the Company shall have prepared and delivered to Buyer the Company’s good-faith estimate of the Net Working Capital of the Company at the Closing Date (the “ Estimated Net Working Capital ” (without giving effect to the transactions contemplated herein)), with such estimate based on the Company’s books and records and calculated on a basis consistent with GAAP.

(b)           The Buyer shall cause to be prepared in accordance with this Section 2.04(b) and deliver to the Seller as promptly as practicable, and in any event within 60 days after the Closing Date, a written statement (the “ Closing Statement ”) setting forth a good faith calculation of the accurate, true and complete balance sheet for the Company as of the Closing Date (without giving effect to the transactions contemplated herein) which Closing Statement shall also indicate the Company’s Net Working Capital at Closing (the “ Closing Date Net Working Capital ”) based on such balance sheet and prepared in accordance with GAAP. The Closing Statement shall contain a good faith calculation of the adjustments to the Closing Date Purchase Price described below in Section 2.04(c) and shall be prepared in accordance with GAAP. The Seller and his representatives shall be given access to all books, records and other data of the Company for the purpose of reviewing the Closing Statement. Representatives and employees of the Company may be consulted from time to time by the Seller and his representatives, and the Seller and his representatives may confer with the Buyer, the Company and their respective representatives as to their examination and determination procedures hereunder. The Closing Statement shall be final and binding on the parties unless, within 60 days after delivery thereof to the Seller, written notice is given by the Seller to the Buyer of the Seller’s objection setting forth in reasonable detail the Seller’s basis for each objection (such notice, a “ Notice of Objection ”). If Notice of Objection is given, the Buyer and the Seller shall consult with each other with respect to the objection. If the Buyer and the Seller are unable to reach agreement within 30 days after the Notice of Objection has been given, the objection subject to such disagreement may be submitted by the Seller for arbitration to an accounting firm that is authorized to conduct business in the State of Florida and duly registered with, and subject to oversight by, the Public Company Accounting Oversight Board (the “ Neutral Accountants ”). Resolution of the objection shall be determined by the Neutral Accountants by applying the accounting methods, principles, practices, conventions, policies and procedures deemed appropriate by the Neutral Accountants to resolve the disputed item(s). The Neutral Accountants firm shall only review the disputed item(s) specified in the Notice of Objection and may not assign a value greater than the greatest value claimed for such item by either party or smaller than the smallest value claimed by either party. The Neutral Accountants shall as promptly as practicable deliver to the Seller and the Buyer a statement in writing setting forth its determination as to the proper treatment of the items as to which there was disagreement, and such determination will constitute an arbitral award and shall be final and binding upon the parties hereto without any further right of appeal upon which a judgment may be entered by a court of law. It is the intention of the foregoing, among other things, that the Neutral Accountants shall act as an expert and not as an arbitrator and the scope of the review by the Neutral Accountants of any dispute between the Buyer and the Seller will be limited solely to the objections of the Seller set forth in the Notice of Objection sent by the Seller as provided in this Section 2.04(b) . The fees, expenses and charges of said accounting firm in making such determination shall be borne 50% by the Seller, on the one hand, and 50% by the Buyer on the other hand. The Closing Date Purchase Price as so adjusted under this Section 2.04 is referred to herein as the “ Final Purchase Price ”. The Net Working Capital as of the Closing Date immediately prior to the Closing, as finally determined pursuant to this Section 2.04(b) , is referred to herein, respectively, as the “ Final Net Working Capital. ” Further, for purposes of this Section 2.04 , the following terms shall have the following meanings: (i) “ Final Net Working Capital Surplus ” means the amount by which the Final Net Working Capital Payment exceeds the Estimated Net Working Capital Payment, and (ii) “ Final Net Working Capital Deficit ” means the amount by which the Estimated Net Working Capital Payment exceeds the Final Net Working Capital Payment.

(c)           The Final Purchase Price shall be determined and paid as follows:

(i)           The Closing Date Purchase Price shall be reduced or increased by either (i) adding thereto the Final Net Working Capital Surplus (the “ Purchase Price Surplus ”), or (y) subtracting therefrom the Final Net Working Capital Deficit (the “ Purchase Price Deficit ”).

(ii)          In the event of a Purchase Price Surplus, the Buyer shall pay to the Seller in immediately available funds an amount equal to the Final Net Working Capital Surplus.

(iii)         In the event of a Purchase Price Deficit, then the Seller shall pay to the Buyer in immediately available funds an amount equal to the Final Net Working Capital Deficit.

(d)           Any adjustments to the Purchase Price in accordance with this Section 2.04 shall be paid to the appropriate party within 5 Business Days after the determination of the Final Purchase Price.

(e)           All payments pursuant to this Section 2.04 shall (x) be treated by all parties for tax purposes as adjustments to the Final Purchase Price and (y) be made by wire transfer of immediately available funds to the account(s) designated by the Seller or Buyer, as the case may be.

(f)           The Buyer acknowledges and agrees that the Company shall declare and pay a distribution to Seller immediately prior to the Closing of approximately all the Company’s cash.

Article III
PUT AND CALL OPTION

Section 3.01          Put and Call Option.

(a)           Grant of Right . Subject to the terms and conditions of this Agreement, on or after the third anniversary of the Closing Date, (i) the Seller shall have the right (the “ Put Right ”) to cause the Buyer to purchase from the Seller, and (ii) the Buyer shall have the right (the “ Call Right ”) to cause the Seller to sell to the Buyer, all of the remaining shares capital stock of the Company held by the Seller (collectively, the “ Option Shares ”) at such time at the Exercise Price (as defined in Section 3.01(f)(i) hereof).

(b)           Procedures .

(i)           If the Seller desires to exercise the Put Right or the Buyer desires to exercise the Call Right (such party exercises the right, the “ Exercising Party ”), the Exercising Party shall deliver to the other party (the “ Responding Party ”) a written notice (the “ Exercise Notice ”) exercising the Put Right or the Call Right, as applicable.

(ii)          The Seller shall, at the closing of any purchase consummated pursuant to this Section 3.01, represent and warrant to the Buyer that (A) the Seller has full right, title and interest in and to the Option Shares, (B) the Seller has all the necessary power and authority and has taken all necessary action to sell such Option Shares as contemplated by this Section 3.01, and (C) the Option Shares are free and clear of any and all Liens other than those arising as a result of or under the terms of this Agreement.

(iii)         Subject to Section 3.01(c) below, the closing of any sale of Option Shares pursuant to this Section 3.01 shall take place no later than 120 Business Days following receipt by the Responding Party of the Exercise Notice, or such other time period as may be agreed to in writing by the parties hereto. The Responding Party shall give the Exercising Party at least 10 Business Days’ written notice of the date of closing (the “ Option Closing Date ”).

(c)           Consummation of Sale . The Buyer shall pay the Exercise Price for the Option Shares by wire transfer of immediately available funds to the account specified in writing by the Seller on the Option Closing Date.

(d)           Cooperation . The Buyer and the Seller each shall take all actions as may be reasonably necessary to consummate the sale contemplated by this Section 3.01, including, without limitation, entering into agreements and delivering certificates and instruments and consents as may be deemed necessary or appropriate.

(e)           Closing . At the closing of the sale and purchase pursuant to this Section 3.01, the Seller shall deliver to the Buyer a certificate or certificates representing the Option Shares, accompanied by stock powers and all necessary stock transfer taxes paid and stamps affixed, if necessary, against receipt of the Exercise Price.

(f)           Exercise Price .

(i)           The purchase price per share at which the Company shall be required to purchase the Option Shares (the “ Exercise Price ”) shall be equal to the Fair Market Value of the Option Shares as of the date of the Exercise Notice.

(ii)          For purposes of this Agreement, the term “ Fair Market Value ” shall mean the fair market value of the Option Shares as of the date of the Exercise Notice, determined on an enterprise value basis without the application of any discounts, including discounts for lack of marketability or minority interest. The Fair Market Value shall be determined by a reputable independent valuation firm with experience in determining the value of companies similar to the Company (a “ Qualified Valuation Firm ”) jointly selected by the Buyer and the Seller. In the event the Buyer and the Seller are unable to agree on the selection of a Qualified Valuation Firm, then the Buyer shall select one Qualified Valuation Firm (the “ Buyer QVF ”), the Seller shall selection one Qualified Valuation Firm (the “ Seller QVF ”), and the Qualified Valuation Firms so selected shall select a third (the “ Independent QVF ”). Each such Qualified Valuation Firm shall determine the Fair Market Value of the Option Shares. If the value determined by either the Buyer QVF or by the Seller QVF is not less than 80% or not more than 120% of the value determined by the Independent QVF, then the average of the Independent QVF value, the Buyer QVF value and the Seller QVF value shall constitute the final Fair Market Value. If the value determined by either the Buyer QVF or by the Seller QVF is less than 80% or more than 120% of the value determined by the Independent QVF (each, a “ Widely Varying Value ”), then such Widely Varying Value of the Buyer QVF and/or Seller QVF shall be disregarded, and the average of the Independent QVF value and any non-Widely Varying Value shall constitute the final Fair Market Value. The costs of the Buyer QVF shall be borne by the Buyer; the costs of the Seller QVF shall be borne by the Seller; and the costs of the Independent QVF (or the mutually agreed upon Qualified Valuation Firm, if applicable) shall be shared equally by the Buyer and the Seller.

Article IV
REPRESENTATIONS AND WARRANTIES OF THE COMPANY

The Company represents and warrants to the Buyer that the statements in this ARTICLE IV are correct as of the date of this Agreement except as set forth in the schedules accompanying this ARTICLE IV (collectively, the “ Disclosure Schedules ”).

Section 4.01          Organization and Corporate Power and No Contravention .

(a)           The Company is a corporation duly organized, validly existing and in good standing under Florida law. The Company has taken all corporate action required to authorize the execution and delivery of this Agreement and each Other Transaction Document to which it is to be a party at Closing. The Company has duly executed and delivered this Agreement, and, at or before the Closing, will have duly executed and delivered each Other Transaction Document to which it is a party.

(b)           The Company has all requisite corporate power and authority to own and operate its properties and assets and to carry on the Business as now conducted. The Company is qualified to do business and is in good standing (or its equivalent) as a foreign corporation in every jurisdiction in which its ownership of property or the conduct of the Business as now conducted requires it to qualify, except where the failure to be qualified would not have a material adverse effect, all of which jurisdictions are set forth on Schedule 4.01(b) . The Company has all requisite corporate power and authority to execute, deliver and perform this Agreement and each Other Transaction Document to which it is to be a party and to consummate the transactions contemplated herein or therein. This Agreement constitutes, and each Other Transaction Document to which it is to be a party at Closing will constitute, the Company’s legal, valid and binding obligation, enforceable against the Company in accordance with its terms (subject to applicable bankruptcy, insolvency, moratorium, reorganization, fraudulent transfer or similar laws affecting creditors’ rights generally and to general equitable principles).

(c)           The execution and delivery of this Agreement and the Other Transaction Documents by the Company and the consummation of the transactions contemplated hereby and thereby by the Company at the Closing does not, directly or indirectly, (i) violate any provision of the Organizational Documents of the Company or any resolution adopted by the board of directors or shareholders of the Company, (ii) except as set forth on Schedule 4.01(c) , conflict with, result in the breach of, or constitute a default under, or require any authorization, consent, approval, exemption or other action by or notice to any third party or any Governmental Body or under the provisions of any material agreement or instrument to which the Company is a party or by which the property of the Company is bound or affected, or (iii) violate any laws, regulations, orders or judgments applicable to the Company.

Section 4.02          Subsidiaries . The Company does not own any equity interests in any other corporation, partnership, limited liability company, joint venture or other entity.

Section 4.03          Organizational Documents; Books and Records .

(a)           The copies of the Organizational Documents of the Company made available to the Buyer are complete and correct and represent the presently effective Organizational Documents of the Company. The Company is not in violation of its Organizational Documents.

(b)           Except as disclosed on Schedule 4.03(b) , the minute books, and share record books of the Company, the contents of which have been made available to the Buyer, are complete and correct in all material respects.

Section 4.04          Capitalization . The Company’s authorized and outstanding capital stock is as set forth on the attached Schedule 4.04 . Schedule 4.04 sets forth the names of the holders of record of all shares of the Company’s issued and outstanding common stock and the number of shares held by each such holder. All of the issued and outstanding shares of the Company’s common stock is duly authorized, has been validly issued and is fully paid and non-assessable. Except for the Purchased Shares and the shares of Company’s common stock retained by the Seller, there are no shares of capital stock or other equity securities of the Company issued, reserved for issuance or outstanding. All of the issued and outstanding shares of common stock of the Company were issued in compliance with applicable securities laws or exemptions therefrom and are not subject to any preemptive rights. There are no outstanding options, warrants, rights to subscribe to, purchase (or repurchase) rights, conversion rights, phantom stock rights, stock appreciation rights, redemption rights, calls or commitments made by the Company relating to any shares of capital stock or other securities issued by the Company containing any equity features, or Contracts by which the Company is bound to issue additional shares of its capital stock or other equity securities, or options, warrants, rights to subscribe to, purchase rights, calls or commitments made by the Company relating to any shares of capital stock or other equity securities of the Company. The Company does not have outstanding any bonds, debentures, notes or other obligations the holders of which have the right to vote (or are convertible into or exercisable for securities having the right to vote) on any matter. The Company is not a party to and there is not any Contract, right of first refusal, right of first offer, proxy, voting agreement, voting trust, registration rights agreement or stockholders agreement, whether or not the Company is a party thereto, with respect to the purchase, sale or voting of any shares of capital stock of the Company or any securities convertible into or exchangeable or exercisable for any shares of capital stock of the Company.

Section 4.05          Financial Statements .

(a)           The attached Schedule 4.05(a) contains true and complete copies of (i) the Company’s audited balance sheets as of December 31, 2013 and December 31, 2014, and the related statements of income and cash flows for the fiscal year ended December 31, 2014 (the “ Year-End Financial Statements ”), and (ii) the Company’s unaudited balance sheet as of September 30, 2015 (the “ Latest Balance Sheet ”) and the related statements of income for the period ended September 30, 2015 (the “ Interim Financial Statements ” and, together with the Year-End Financial Statements, the “ Financial Statements ”). Except as specifically noted on Schedule 4.05(a) , the Financial Statements (including any related notes and Schedules) present fairly in all material respects the financial condition and results of operations of the Company in accordance with GAAP as of the dates and for the periods referred to therein. Except as set forth on Schedule 4.05(a) , all of the Financial Statements have been prepared in accordance with GAAP, applied on a consistent basis throughout the periods indicated.

(b)           Except as set forth on Schedule 4.05(b) , the Company does not have any liabilities or obligations (together the “ Liabilities ”) of a type required to be reflected on financial statements prepared in accordance with GAAP, except for (i) Liabilities disclosed, provided for, reflected in, reserved against or otherwise described in the Latest Balance Sheet, (ii) Liabilities incurred, accruing or arising after the date of the Latest Balance Sheet in the ordinary course of business consistent with past practice, and (iii) Liabilities under this Agreement.

(c)           The books and records of the Company has been maintained in accordance with GAAP on a basis consistent with past periods and throughout the periods involved. The Company (i) makes and keeps accurate books and records and (ii) maintains internal accounting controls that provide reasonable assurance that (A) transactions are executed in accordance with management’s authorization, (B) transactions are recorded as necessary to permit preparation of its consolidated financial statements in accordance with GAAP, and (C) access to their respective assets is permitted only in accordance with management’s authorization.

(d)           Except as provided on Schedule 4.05(d) , the Company does not have any Indebtedness.

(e)           The Company has delivered to Buyer a true, correct and complete aging schedule of all accounts receivable of the Company, as of the business day prior to Closing. All of the Company’s accounts receivable (i) represent actual, valid obligations incurred by the respective account debtors owing to the Company with respect to the Business, (ii) have arisen from bona fide transactions in the ordinary course, (iii) are adequately reserved and properly stated on the books and records of the Company in accordance with GAAP, (iv) the goods and services involved have been sold and delivered or performed, as the case may be, to the account obligors, and, no further goods other than by warranty are required to be provided and no further services other than warranty services are required to be rendered in order to complete the sales and fully render the services and to entitle collection of the accounts receivable in full. Except as set forth in Schedule 4.05(e) , no such account receivable has been assigned or pledged to any other Person and, except only to the extent fully reserved against as set forth in the Closing Statement, to the Company’s Knowledge, no defense or set-off to any such account has been asserted by the account obligor.

Section 4.06          Absence of Certain Developments . Except as set forth on the attached Schedule 4.06 and except as expressly contemplated by this Agreement, since the date of the Latest Balance Sheet, (i) the Company has not engaged in any material transaction that was not in the ordinary course of business and consistent with past practice, (ii) to the Company’s Knowledge, there has not been any material adverse change in the Company’s or the Business’ sales patterns, pricing policies, accounts receivable or accounts payable, taken as a whole, and (iii) to the Company’s Knowledge, there has not been any material adverse change in the relationships between the Company, on the one hand, and any customer, supplier, licensee, lessor, insurer or other Person with whom the Company has material business relationships, on the other hand. Without limiting the generality of the foregoing, except as set forth on the attached Schedule 4.06 and except as expressly contemplated by this Agreement, since the date of the Latest Balance Sheet, the Company has not:

(a)           issued or sold any of its capital stock or other equity securities, or any options, warrants, convertible or exchangeable securities, subscriptions, rights, stock appreciation rights, calls or commitments of any kind with respect to its capital stock or other equity securities, or split, combined or reclassified any shares of its capital stock or other equity securities;

(b)           (i) increased the base salary, annual bonus or any other form of compensation payable to any of its employees or directors (except for changes in compensation in the ordinary course of business and consistent with past practice in connection with promotions or periodic reviews, but only with respect to employees other than officers or directors), (ii) implemented, announced or committed to any “across-the-board” wage increase for its hourly employees or (iii) adopted or, except as required by applicable law, amended any Plan;

(c)           entered into any Contract with any labor union;

(d)           planned, announced, implemented or effected any reduction in force, lay off, early retirement program or similar program applicable generally across the Company’s employee base;

(e)           adopted a plan of liquidation, dissolution, merger, consolidation or other reorganization;

(f)           (i) made any material change in its accounting or tax methods, principles or practices or elections, or (ii) revalued any assets of the Company, including inventory or accounts receivable write-downs, except as reflected in the Financial Statements;

(g)           accelerated the collection of, or discounted, accounts receivable, delayed the payment of accounts payable or deferred expenses;

(h)           incurred any Indebtedness;

(i)           created or incurred any Lien on any assets of the Company or otherwise disposed of any assets of the Company in excess of $25,000 individually or $100,000 in the aggregate, other than sales of obsolete equipment in the ordinary course of business consistent with past practice and other than sales of inventory in the ordinary course of business;

(j)           made any capital contributions to or equity or debt investments in any Person, other than non-material advances to vendors and employees in the ordinary course of business consistent with past practice;

(k)           made any acquisition of any assets, properties, capital stock or business of any other Person, whether by merger, stock or asset purchase or otherwise, other than purchases of fixed assets, inventory, supplies and software/systems upgrades in the ordinary course of business consistent with past practice;

(l)           sold, licensed, assigned, transferred, abandoned, allowed to lapse or otherwise disposed of any material Intellectual Property or other intangible assets, except in the ordinary course of business consistent with past practice;

(m)           (i) terminated any Contract that if in existence on the date hereof would have been required to be listed on Schedule 4.06 or (ii) terminated or allowed to expire any Contract pursuant to which the Company leased any asset;

(n)           entered into any Contract outside of Contracts and purchase orders entered into in the ordinary course of business, to provide services that could reasonably be expected to result in the Company being required to commit in excess of $100,000 for either working capital or the purchase of assets to fulfill its obligations under such Contract;

(o)           failed to maintain in full force and effect the Insurance Policies;

(p)           made or revoked any material election with regard to Taxes or filed any material amended Tax Returns;

(q)           commenced or settled any criminal or material civil Claim; or

(r)           committed to do any of the foregoing.

Section 4.07          Title to and Conditions of Assets; Real Property .

(a)           The Company has good and marketable title to all of its properties, interests in properties and assets, real and personal, or with respect to leased properties and assets, valid leasehold or sub-leasehold interests therein, free and clear of all Liens, except for Permitted Liens. The property and equipment of the Company and all other tangible property that is used in the operation of its business is in good operating condition and repair, subject to normal wear and tear, are adequate and suitable in all material respects for the uses to which they are being put and the operation of such businesses.

(b)           Schedule 4.07 identifies all real property owned, leased or subleased by the Company (the “ Real Property ”). The Real Property is all of the real property necessary for the conduct of the business of the Company as presently conducted. Neither the Seller nor any of its Affiliates, including the Company, has leased or otherwise granted to any Person the rights to use or occupy any owned Real Property or any portion thereof. There are no outstanding options to purchase such owned Real Property or any portion thereof or interest therein. The Company does not have an option to acquire any real property. The Company’s interest in any lease or sublease with respect to such Real Property is not subject to any Lien, except Permitted Liens. Each lease agreement to which the Company is a party regarding Real Property is a valid and binding obligation of the Company, as applicable, and is in full force and effect and is enforceable against the Company and, to the Knowledge of the Company, against the other parties thereto, subject to applicable bankruptcy, insolvency, reorganization, moratorium and similar laws of general application relating to or affecting creditors’ rights and to general principles of equity. The Company is not in or, alleged to be in, breach or default under any of such lease agreements. There are no Contracts to which the Company is a party granting to any Person the right of use or occupancy of any such leased Real Property, and there are no parties (other than the Company) occupying any of such leased Real Property. The Company’s occupation, possession and use of the Real Property has not been disturbed and no claim has been asserted or threatened adverse to the rights of the Company to the continued occupation, possession and use of any of the Real Property. The Real Property is supplied with all utilities adequate to serve such Real Property for the Business’ current use thereof.

Section 4.08          Tax Matters . Except as set forth on the attached Schedule 4.08 :

(a)           The Company has properly prepared and duly and timely filed (taking into account any applicable extensions) all Tax Returns required to be filed by it with the appropriate Governmental Body in all jurisdictions in which any such Tax Returns were required to be filed. Each such Tax Return has been prepared in compliance in all material respects with all applicable laws, and all such Tax Returns are accurate, complete and correct in all material respects. All Taxes payable by or on behalf of the Company, regardless of whether shown on such Tax Returns, have been fully and timely paid. The Company has made available to the Buyer correct and complete copies of all Tax Returns of the Company for taxable periods ending on or after December 31, 2012, and all examination reports, and statements of deficiencies assessed against or agreed to by the Company issued since January 1, 2013. The Company has complied in all material respects with all applicable laws and regulations relating to the payment and withholding of Taxes and has duly and timely withheld and paid over to the appropriate Governmental Bodies all Taxes required to have been withheld and paid in connection with any amounts paid to any employee, independent contractor, creditor, stockholder or other third party.

(b)           The Company is not the beneficiary of any extension of time within which to file any Tax Return, which Tax Return has since not been filed. No agreement, waiver or other document or arrangement extending or having the effect of extending the period for assessment or collection of Taxes (including any applicable statute of limitation) has been executed or filed with any Governmental Body by or on behalf of the Company. No power of attorney with respect to any Tax matter is currently in force.

(c)           No Tax Return concerning or relating to the Company or with respect to the Company’s income, operations, assets or activities for any taxable period or portion thereof since December 31, 2012 has been audited or examined by a Governmental Body. There is no Tax Proceeding pending or, to the Company’s Knowledge, threatened against or with respect to the Company. All deficiencies asserted or assessments made as a result of any audits or examinations by any Governmental Body of the Tax Returns of or covering or including the Company have been fully paid. No claim has been made by a Governmental Body in a jurisdiction where Tax Returns concerning or relating to the Company or with respect to the Company’s income, operations, assets or activities have not been filed that it is or may be subject to taxation by that jurisdiction. No issue has been raised by any Governmental Body in any prior audit or examination which, by application of the same or similar principles, could reasonably be expected to result in a proposed deficiency for any subsequent taxable period.

(d)           The Company is not a party to or bound by any Tax allocation, Tax indemnity, Tax sharing or similar agreement or arrangement.

(e)           Neither the Company, nor any Person on behalf of the Company, has (1) agreed to or is required to make any adjustments pursuant to Section 481(a) of the Code or any similar provision of state, local or foreign law by reason of a change in accounting method initiated by the Company or has any Knowledge that a Governmental Body has proposed any such adjustment or change in accounting method, or has any application pending with any Governmental Body requesting permission for any changes in accounting methods that relate to the business or operations of the Company or (2) executed or entered into a closing agreement pursuant to Section 7121 of the Code or any predecessor provision thereof or any similar provision of state, local or foreign law with respect to the Company. The Company is not required to include any item of income in, or exclude any item of deduction from, taxable income for any taxable period (or portion thereof) ending after the Closing Date as a result of any installment sale or open transaction disposition on or prior to the Closing Date or prepaid amount received on or prior to the Closing Date.

(f)           The Company is not a member of an affiliated group of corporations within the meaning of Section 1504 of the Code or has not filed or been included in a combined, consolidated or unitary income Tax Return with another Person. The Company has no liability for the Taxes of any Person under Treasury Regulation § 1.1502-6 (or any similar provision of state, local, or foreign law), or as a transferee or successor, by Contract or otherwise. The Company does not own any interest in any Person that is treated as a partnership for U.S. federal income Tax purposes or would be treated as a pass-through or disregarded entity for any Tax purpose.

(g)           There are no Liens for Taxes on the assets of the Company, except for Liens for Taxes not yet due and payable.

(h)           The Company has disclosed on its Tax Returns all positions taken therein that could reasonably be expected to give rise to a substantial understatement of federal income Tax within the meaning of Section 6662 of the Code. The Company is not and has not been a party to any “reportable transaction” as defined in Treasury Regulation § 1.6011-4.

(i)           The Seller is not a foreign person within the meaning of Section 1445 of the Code or any other laws requiring withholding of amounts paid to foreign persons. The transactions contemplated herein are not subject to Tax withholding provisions under the Code or any other applicable Law.

(j)           None of the assets of the Company is (1) required to be or are being depreciated under the alternative depreciation system of Section 168(g)(2) of the Code, (2) subject to Section 168(f) of the Code, or (3) property that the Company will be required to treat as “tax exempt use property” within the meaning of Section 168(h)(1) of the Code. The Company has not issued any “industrial development bonds” as contemplated in the Internal Revenue Code of 1954, as amended prior to the enactment of the Code, or “private activity bonds” within the meaning of Section 141 of the Code or other tax exempt financings to acquire or lease assets of the Company.

(k)           The Company is an S Corporation for United States federal income tax purposes and the Company’s S Corporation election has been maintained, uninterrupted, since the Company’s formation.

Section 4.09          Contracts and Commitments .

(a)           Except as set forth on the attached Schedule 4.09 , the Company is not a party to any, whether written or oral:

(i)           collective bargaining Contract with any labor union;

(ii)          bonus, pension, profit sharing, retirement or other form of deferred compensation plan, or stock purchase, stock option or similar plan, other than as set forth on Schedule 4.12 ;

(iii)         Contract for the employment of any officer, individual employee or other person on a full-time or consulting basis providing for base compensation in excess of $35,000 per annum;

(iv)         Contract providing for severance payments in excess of $25,000;

(v)          Contract evidencing, securing or otherwise relating to Indebtedness or to mortgaging, pledging or otherwise placing a Lien on any portion of the assets of the Company;

(vi)         guaranty of any Indebtedness;

(vii)        Contract under which it is lessee of, or holds or operates, any real or tangible personal property owned by any other Person;

(viii)       Contract under which it is lessor of or permits any third-party to hold or operate any tangible property, real or personal;

(ix)          Contract in excess of $100,000 with any (x) Major Customer to provide goods, services, or products or (y) Major Supplier to purchase goods, services, or products;

(x)           Contract which prohibits the Company from freely engaging in business anywhere in the world;

(xi)          Contract containing a standstill or similar agreement pursuant to which the Company has agreed not to acquire assets or securities of any other party;

(xii)         Contract providing for the indemnification by the Company of any Person, except for any such Contract that (x) is not material to the Company and (y) was entered into in the ordinary course of business consistent with past practice;

(xiii)        Contract that contains a put, call or similar right pursuant to which the Company could be required to purchase or sell, as applicable, any equity interests of any Person or assets that have a fair market value or purchase price of more than $50,000;

(xiv)       Contract with any Person (other than purchase orders entered into in the ordinary course of business) that is reasonably likely to require either (x) annual payments to or from the Company of more than $100,000 or (y) aggregate payments to or from the Company of more than $100,000;

(xv)        Contracts creating any partnership or joint venture or similar arrangement involving the sharing of profits or losses;

(xvi)       Contracts containing exclusivity or “most-favored-nations” provisions;

(xvii)      any agreement (including confidentiality, non-compete, non-solicitation and restrictive covenant agreements) that purports to limit the Company’s (or, to the Company’s Knowledge, any of its employees’ or independent contractors’) freedom to compete and engage in business freely in any line of business or in any geographic area; or

(xviii)     Contracts with any Related Party.

Except as identified on Schedule 4.09 with respect to limitations imposed by confidentiality commitments under applicable law, true and complete copies of each written Contract listed on Schedule 4.09 have been made available to the Buyer (including all modifications, amendments and supplements thereto).

(b)           Each of the Contracts listed on Schedule 4.09 is a valid and binding obligation of the Company, and, to the Knowledge of the Company, is valid, binding, and enforceable against the other parties thereto, enforceable in accordance with its terms, except as may be limited by bankruptcy, insolvency, reorganization, moratorium and similar Laws relating to or affecting creditors’ rights and general principles of equity. Except as set forth on Schedule 4.09 , (i) the Company has performed all of its material obligations required to be performed as of the date of this Agreement under, and is not in material default under (or, to the Company’s Knowledge, is not alleged to be in breach of or default under), any Contract listed on Schedule 4.09 , (ii) to the Knowledge of the Company, each other party to each of the Contracts listed on Schedule 4.09 is not in material default thereunder, and (iii) to the Company’s Knowledge, no event has occurred which with notice or lapse of time would constitute a breach or default in any material respect by the Company or by any such other party thereto, or permit termination, modification or acceleration, under such Contract. There has been no termination or notice of default received by the Company or, to the Knowledge of the Company, any threatened termination or notice of default under any Contract listed on Schedule 4.09 .

(c)           Except as otherwise set forth on Schedule 4.09(c) , the Company is not a party to or bound by any Contract or Contracts the terms of which were arrived at by or otherwise reflect less-than-arm’s-length negotiations or bargaining. Except as set forth on Schedule 4.09(c) , no Affiliate of the Company is a party to any Contract relating to the Business. Each Contract of the Company relates solely to the Business (and not to any other business in which the Company or the Seller or any of their Affiliates may be engaged).

Section 4.10          Intellectual Property . Schedule 4.10 sets forth a list of all Intellectual Property (other than items falling within clause (v) and (vii) of the definition of Intellectual Property and “off-the-shelf” commercially available Software) owned or licensed by the Company and used in and material to the conduct of the Business. The Company’s rights in the Intellectual Property owned by or licensed to it constitute all the rights in Intellectual Property required for the operation of the Business as presently conducted in the last five (5) years. No claim or allegation has been asserted or, to the Knowledge of the Company, threatened by any third party that the use or exploitation by the Company of any Intellectual Property infringes, misappropriates or violates the Intellectual Property of any third-party. To the Company’s Knowledge, the operation of the Business does not infringe, misappropriate or violate any Intellectual Property of third parties. No action before any Governmental Body has been instituted, settled or, to the Company’s Knowledge, threatened that alleges any such infringement, violation or misappropriation, and none of the Intellectual Property is subject to any outstanding order or decree of any Governmental Body directed specifically at the Company. The Company has not made any indemnification payments to any Person for or against any infringement with respect to any intangible rights. To the Company’s Knowledge, no third party is infringing or misappropriating any Intellectual Property of the Company. The Company has taken commercially reasonable steps to protect the confidentiality of the Company’s trade secrets. Schedule 4.10 lists all material licenses and sublicenses whereby the Company is granted rights, interests and authority, whether on an exclusive or non-exclusive basis, as licensee with respect to any Intellectual Property that is used in or necessary for the Business. The Company has made available to Buyer true and complete copies of all such agreements or the forms thereof other than with respect to off the shelf software and programs. To the Company’s Knowledge, all such agreements are valid, binding and enforceable between the Company and the other parties, and the Company and, to the Company’s Knowledge, the other parties are in full compliance with the terms and conditions of such agreements. Except as set forth on Schedule 4.10 , no interest in the Company’s Intellectual Property has been assigned, transferred, licensed or sublicensed by the Company or the Seller to any Person other than in the ordinary course of the Company’s business. Except as disclosed on Schedule 4.10 , (i) neither the Company nor any Person acting on the Company’s behalf has disclosed, delivered or licensed to any Person, agreed to disclose, deliver or license to any Person, or permitted the disclosure or delivery to any escrow agent or other Person of, any source code owned by the Company and included in any Products (“ Company Source Code ”), and (ii) to the Company’s Knowledge, no event has occurred, and no circumstance or condition exists, that (with or without notice or lapse of time or both) will, or would reasonably be expected to, result in the disclosure or delivery by or on behalf of the Company of any Company Source Code. Schedule 4.10 lists all Products that are or contains open source software or software that is distributed under a licensing or distribution model that requires, as a condition of use, modification and/or distribution of such software (or other software incorporated into, derived from or distributed with such software) that the software be disclosed or distributed in source code form, be licensed for the purpose of making derivative works, or be redistributable at no or minimal charge (including but not limited to the GNU General Public License) that (i) the Company licenses to a third party in connection with the Business; (ii) the Company provides on a software-as-a-service or similar basis in connection with the Business; or (iii) is otherwise incorporated into, combined with, or distributed in conjunction with any Products in connection with the Business (collectively, “ Incorporated Open Source Software ”) and identifies the software and the type of license or distribution model governing its use. The Company’s use and/or distribution of each component of Incorporated Open Source Software with or in any Products complies with all material provisions of the applicable license agreement, and in no case does such use or distribution give rise under such license agreement to any obligation to disclose or distribute any Company Source Code in source code form, to license any such Company Source Code or other Intellectual Property owned by the Company for the purpose of making derivative works, or to distribute any such Company Source Code owned by the Company without charge.

Section 4.11          Litigation . Except as set forth in Schedule 4.11 , there are no civil, criminal or administrative causes of action, hearings, arbitrations, audits, or other proceedings pending or, to the Knowledge of the Company, threatened against the Company, at law or in equity, before or by any Governmental Body. Except as set forth in Schedule 4.11 , the Company is not, subject to any outstanding judgment, order or decree of any Governmental Body directed specifically at the Company. No Governmental Body has indicated in any writing received by the Company any intention to conduct any audit, investigation or other review with respect to the Company, other than audits, investigations or reviews that have been favorably resolved in the Company’s favor and concluded without any liability to the Company. Schedule 4.11 sets forth a true and correct listing of all material actions, suits, claims or proceedings before any Governmental Body against the Company that were pending, settled or adjudicated in the last seven (7) years.

Section 4.12          Employee Benefit Plans .

(a)           Schedule 4.12 lists each “employee benefit plan” (as defined in Section 3(3) of ERISA), and each other employment, incentive (equity or otherwise), severance, option, deferred compensation, retention, change in control, fringe benefit, or other compensatory agreement, policy, plan, manual or arrangement provided or maintained by the Company or any ERISA Affiliate to, with or for the benefit of any current or former employee, director or consultant of the Company or any of their respective dependents or beneficiaries, including without limitation, the Company’s Section 125 Cafeteria Plan and 401(k) Plan (each, a “ Plan ”). Each Plan which is intended to meet the requirements of a “qualified plan” under Section 401(a) of the Code is so qualified, and the Company has no Knowledge of any facts or circumstances that could reasonably be expected to jeopardize the qualification of such Plan. Each trust maintained in connection with each such qualified Plan is exempt from taxation. The Plans comply in form and in operation in all material respects with their terms and the requirements of all applicable laws and regulations. Schedule 4.12 also lists all vacation and sick leave policies and all medical, dental, disability and life insurance policies maintained by the Company.

(b)           With respect to each Plan, the Company has made available to the Buyer true and complete copies of the following documents, as applicable: (i) all plan documents of each Plan; (ii) all funding and administrative arrangement documents including trust agreements, insurance contracts, custodial agreements, investment manager agreements and service agreements; (iii) the most recently filed Form 5500; (iv) the summary Plan description and each summary of material modification; and (v) the most recent financial statement. In the case of any material unwritten Plan or other benefit program or agreement, a written description of such has been furnished to Buyer. All amendments required to bring any Plan into conformity with any applicable provisions of ERISA and the Code have been duly adopted.

(c)           With respect to the Plans, (i) all required contributions by the Company have been timely made, (ii) there are no civil, criminal or administrative causes of action, hearings, arbitrations, audits or other proceedings pending or, to the Knowledge of the Company, threatened, other than routine claims for benefits, (iii) there have been no “prohibited transactions” (as that term is defined in Section 406 of ERISA or Section 4975 of the Code) and (iv) all material reports, returns and similar documents required to be filed by the Company with any Governmental Body or distributed to any Plan participant have been timely filed or distributed.

(d)           Neither the Company, nor any of its ERISA Affiliates, contributes to, has ever contributed to or has ever incurred any liability with respect to any “multiemployer plan” (as defined in Section 3(37) of ERISA).

(e)           The execution and delivery of this Agreement and performance of the transactions contemplated hereby will not (i) constitute an event under any Plan or Contract that will or may result in any payment (whether of severance pay or otherwise), acceleration, forgiveness of indebtedness, vesting, distribution, increase in benefits or obligation to fund benefits with respect to any current or former employee of the Company, or (ii) result in the triggering or imposition or any restrictions or limitations on the right of the Company to amend or terminate any Plan.

(f)           None of the Plans, if administered in accordance with their terms, would result in the imposition of interest or an additional tax on any participant thereunder pursuant to Section 409A.

(g)           Except as required by COBRA, no Plan provides post-termination group health or other welfare benefits to any current or former employee, director or consultant (or any of their dependents or beneficiaries).

Section 4.13          Insurance . The attached Schedule 4.13 sets forth each insurance policy (including fire, commercial liability, products liability, workers’ compensation and vehicular) maintained by the Company on the Business and its properties, assets, products or personnel (the “ Insurance Policies ”), including, with respect to each Insurance Policy, the name of the insurer, the policy effective dates, the annual premiums, the limits and the deductibles. To the Company’s Knowledge, such policies are sufficient for compliance by the Company with all applicable Contracts of the Company, applicable material governmental permits, and applicable Laws. Each of the Insurance Policies is valid and binding and in full force and effect. All premiums due thereunder have been paid when due, and the Company has not received any notice of cancellation or termination or intent to cancel any Insurance Policy. The Insurance Policies will not terminate or lapse by reason of the execution and delivery of this Agreement or the consummation of the transactions contemplated hereby. The Company is not in default with respect to any provision contained in any Insurance Policy and has not failed to give any notice or present any applicable claim under any insurance policy in due and timely fashion. To the Company’s Knowledge, the Company has complied in all material respects with all requirements to purchase insurance under any Contract or law applicable to the Company. None of the insurance carriers have provided notice to the Company (i) of an intention to cancel any such policy or to materially increase any insurance premiums (including workers’ compensation premiums), or (ii) that any insurance required to be listed on Schedule 4.13 will not be available in the future on substantially the same terms as currently in effect.

Section 4.14          Environmental Compliance .

(a)           Except as set forth in Schedule 4.14(a), to the Company’s Knowledge, the Company is, and for the five (5) years prior to the date hereof has been at all times, in compliance in all material respects with all Environmental Laws applicable to its operations.

(b)           Except as set forth in Schedule 4.14(b), to the Company’s Knowledge, the Company has not received in the five (5) years prior to the date hereof a written notice or other communication from any Governmental Body regarding any actual or alleged violation of or liability or investigatory, corrective or remedial obligation under Environmental Laws.

(c)           Except as set forth in Schedule 4.14(c), (i) neither the Company nor any Affiliate of the Company has at any time Released, nor to the Company’s Knowledge has it at any time allowed or arranged for any third party to Release, Hazardous Substances to, at or upon: (a) any location other than a site lawfully permitted to receive such Hazardous Substances; (b) any parcel of real property owned, used or leased at any time, including without limitation the Real Property, by the Company, except in compliance with applicable Environmental Laws; or (c) any site which, pursuant to the Comprehensive Environmental Response, Compensation, and Liabilities Act of 1980, as amended (CERCLA) or any similar state or other Law, has been placed on the National Priorities List or its equivalent under any state or other Law, or as to which the Environmental Protection Agency or any relevant state agency or other Governmental Body has notified the Company (or any Affiliate of the Company) that it has proposed or is proposing to place on the National Priorities List or such equivalent; and (ii) there has not occurred while occupied by the Company, nor is there presently occurring, a Release, or, to the Knowledge of the Company, any threatened Release of any Hazardous Substance on, into or directly beneath the surface of any Real Property. Schedule 4.14(c) also sets forth the Hazardous Substances presently used on the Real Property.

(d)           To the Company’s Knowledge, the Company has obtained and is in compliance with all permits, licenses and authorizations required under Environmental Laws for the operation of the Business as presently conducted, including all environmental, health and safety governmental permits necessary for the Company’s operation of the Real Property as is presently conducted.

(e)           The Company has delivered or made available to the Buyer true and complete copies of all environmental reports, studies, analyses, tests, audits, assessments or monitoring undertaken by the Company, or its agents or representatives, relating to or affecting the Real Property, the Business or the Company.

Section 4.15          Permits; Compliance with Laws .

(a)           To the Company’s Knowledge, the Company holds and is in compliance, in all material respects, with all permits, certificates, licenses, approvals, registrations and authorizations required by it under all applicable Laws and regulations in connection with the conduct of the Business as presently conducted (collectively, “ Permits ”), except for those Permits the failure of which to hold could not, individually or in the aggregate, reasonably be expected to adversely affect in any material respect the Company’s ability to conduct the Business as presently conducted. Schedule 4.15(a) sets forth all material Permits held by the Company. No loss or expiration of any such Permit is pending or, to the Knowledge of the Company, threatened or reasonably foreseeable, other than expiration in accordance with the terms thereof of Permits that may be renewed in the ordinary course of business without lapsing.

(b)           To the Company’s Knowledge, the Company is, and for the five (5) years prior to the date hereof has been, in compliance with all applicable Laws, including all applicable export-control, trade and economic sanctions Laws, Nuclear Laws, the U.S. State Department’s International Traffic in Arms Regulations, U.S. Commerce Department’s Export Administration Regulations, and Laws maintained by the U.S. Treasury Department’s Office of Foreign Assets Control, except for any noncompliance which could not, individually or in the aggregate, reasonably be expected to adversely affect the Company’s ability to conduct the Business as presently conducted. The Company has not, in the five (5) years preceding the date hereof, received any written notice from any Governmental Body alleging that the Company is in violation of any Law or regulation applicable to the conduct of the Business. No product sold or service provided by the Company during the last five (5) years has been sold directly or, to the Company’s Knowledge, indirectly by the Company to, or performed directly or, to the Company’s Knowledge, indirectly by the Company on behalf of, Cuba, Iran, Sudan, Syria or North Korea.

(c)           To the Company’s Knowledge, neither the Company nor any director, officer, employee or other Person acting on behalf of the Company, (i) has engaged, directly or indirectly, in any violation of the Foreign Corrupt Practices Act, or any other applicable anti-bribery or anti-corruption Law (collectively, the “ Anti-Corruption Laws ”), or any anti-boycott, anti-terrorism, or arms-control Laws or sanctions programs, or (ii) has ever been the subject of any bribery, money laundering or anti-kick-back proceeding by any Governmental Body. The Company has not conducted business with any restricted party identified in writing by the U.S. government as a Person with whom or with which conducting business would constitute a violation by the Company of U.S. Law. Without limiting the foregoing, (1) neither the Company nor any of its directors, officers, employees or other Persons acting on its behalf, has, directly or indirectly, taken any action, or failed to act, in a manner that would be a violation of any Anti-Corruption Laws; and (2) none of the officers, directors, or employees of the Company are Government Officials. Except as set forth on Schedule 4.15(c) , during the last five (5) years, the Company has not performed any service or sold any product to customers in Iraq, Kuwait, Lebanon, Libya, Qatar, Saudi Arabia, Sudan, Syria, United Arab Emirates, or the Republic of Yemen.

Section 4.16          [Intentionally Deleted].

Section 4.17          Broker Fees . Neither the Company, nor any Person acting on its behalf, has paid or become obligated to pay any fee or commission to any broker, finder, investment banker or similar intermediary for or on account of the transactions contemplated by this Agreement.

Section 4.18          Labor and Employment Matters .

(a)           To the Company’s Knowledge, except as set forth on Schedule 4.18(a) , the Company is, and for the two (2) years prior to the date hereof has been, in compliance in all material respects with all applicable Laws and regulations respecting employment and employment practices, including provisions relating to overtime pay, wages and hours, equal opportunity, collective bargaining, nondiscrimination, harassment, immigration, occupational health and safety, and the payment of social security and other payroll Taxes. Except as described in Schedule 4.18(a) hereto, the Company has not instituted any “freeze” of, or delayed or deferred the grant of, any cost-of-living or other salary adjustments for any of its employees since January 1, 2015, and no such freezes or temporary salary adjustments instituted prior to January 1, 2015 are currently in effect. To the Knowledge of the Company, there are no organizing activities or collective bargaining arrangements that could affect the Company pending or under discussion with any labor organization or group of employees of the Company, and to the Knowledge of the Company no such activities have occurred in the five (5) years preceding the date hereof. In the five (5) years preceding the date hereof, there has not been any labor strike, slowdown or work stoppage by any employees of the Company. There are no pending or, to the Knowledge of the Company, threatened charges of unfair labor practices, employment discrimination or other wrongful action before any Governmental Body with respect to any aspect of employment of any person by the Company employed or formerly employed by the Company. Except as set forth on Schedule 4.18(a) , the Company has not received, within the past five (5) years, any written notification of any grievances, complaints or charges that have been filed against the Company under any dispute resolution procedure (including any proceedings under any dispute resolution procedure under any collective bargaining agreement) that have not been dismissed. The Company has not received written notice of pending or threatened changes of employment status with respect to (including resignation of) the current senior management or key supervisory personnel of the Company. Except as set forth in Schedule 4.18 , the Company has not classified an individual as an “independent contractor” or of similar status who, according to a Plan or Contract or applicable Law, should have been classified as an employee or of similar status. The Company has no “leased employees” within the meaning of Section 414(n) of the Code.

(b)           Schedule 4.18(b) contains a complete and accurate list of the following information for each employee, director, officer or manager of the Company, including each employee on leave of absence or layoff status: name; job title (including whether full or part time); current compensation paid or payable and any change in compensation since January 1, 2015; immigration status; a description of the fringe benefits provided to such employee as of the date of this Agreement; tenure with the Company; and service credited for purposes of vesting and eligibility to participate under the Plans.

(c)           No director or officer of the Company and, to the Knowledge of the Company, no other Company employee is a party to, or is otherwise bound by, any agreement or arrangement, including any confidentiality, non-competition, or proprietary rights agreement, between such employee, director or officer and any other Person (“ Proprietary Rights Agreement ”) that in any way adversely affects or will affect (i) the performance of his duties as an employee, director or officer of the Company, or (ii) the ability of the Company to conduct its Business.

(d)           Except as set forth on Schedule 4.18(d) , all employees of the Company are employed by the Company on an “at will” basis.

(e)           Except as set forth in Schedule 4.18(e) , as of the Effective Date, all compensation, including wages, commissions and employment taxes, social security payments and similar governmental payments, payable to (or for the benefit of) employees, independent contractors or consultants of the Company for services performed on or prior to the Effective Date have been paid in full.

(f)           Schedule 4.18(f) sets forth all consulting arrangements between the Company and any Person. The Company is in compliance in all material respects with all laws applicable to such consulting arrangements.

(g)           Except as set forth on Schedule 4.18(g) , each employee of the Company is properly classified with respect to eligibility for minimum wage and overtime under the FLSA and similar applicable state laws. To the Company’s Knowledge, all employees of the Company who reside and/or work in the United States are residing and/or working in the United States (i) free of any restrictions or limitations on their ability to accept employment lawfully in the United States and (ii) in compliance with all applicable Laws, rules and regulations relating to immigration and naturalization, including but not limited to, the Immigration Act of 1997, as amended, and the Labor Condition Application requirements and regulations of the U.S. Department of Labor. Except as set forth on Schedule 4.18(g) , no action, suit, proceeding, hearing, charge, complaint or claim has been filed or commenced against the Company or, to the Company’s Knowledge, threatened, by or on behalf of any employees, that (a) alleges any failure so to comply or (b) seeks removal, exclusion or other restrictions on (i) such employee’s ability to reside and/or accept employment lawfully in the United States and/or (ii) the Company’s continued ability to sponsor employees for immigration benefits and, to the Company’s Knowledge, there is no reasonable basis for any of the foregoing. To the Company’s Knowledge, there is no reasonable basis to believe that any employee will not be able to continue to so reside and/or accept employment lawfully in the United States in accordance with all such Laws, rules and regulations. The Company and its personnel maintain all security clearances which are necessary for the Company’s operation of the Business.

Section 4.19          Related Party Transactions .

(a)           Except as set forth on the attached Schedule 4.19(a) , no Related Party (i) has any interest in any property (real, personal, or mixed and whether tangible or intangible) used in or pertaining to the Business, or (ii) owns, of record or as a beneficial owner, an equity interest or any other financial interest in a Person that has business dealings or a material financial interest in any transaction with the Company.

(b)           Except as set forth on the attached Schedule 4.19(b) , the Company is not indebted, directly or indirectly, to any Related Party in any amount whatsoever, other than for salaries for services rendered or reimbursable business expenses or obligations owed under Company employee benefit plans, nor is any Related Party indebted to the Company, except for advances made to employees of the Company in the ordinary course of business for reimbursable business expenses anticipated to be incurred by such obligor.

(c)           Effective as of the Closing, all Contracts with Related Parties set forth on Schedule 4.19(c) will be terminated and the Company will be fully released of all of their obligations under such Contracts, without any additional cost, obligation, liability or loss to the Company. The Company has delivered or made available to the Buyer written evidence of such terminations and releases.

Section 4.20          Customers and Suppliers .

(a)           Except as limited by confidentiality commitments under applicable law, Schedule 4.20(a) sets forth a list of the ten (10) largest customers of the Company for the years ended December 31, 2013 and 2014 and the nine months ended September 30, 2015 (collectively, the “ Major Customers ”) showing the total sales made by the Company to each such Major Customer during each such period. To the Knowledge of the Company, no Major Customer has notified the Company or threatened to materially decrease or limit its purchase of products or receipt of services from the Company. Since December 31, 2014, other than as disclosed on Schedule 4.20(a) , no termination, cancellation or material limitation of, or any material modification or change in, the business relationship with the Company has occurred or, to the Knowledge of the Company, has been threatened by any Major Customer. Except as set forth on Schedule 4.20(a) , the Company has not received any pre-payments, advances or advanced payments from any Major Customer. Except as set forth on Schedule 4.20(a) , no Major Customer has a right to receive any rebate, allowance, cash incentive payment or other back-end payment or to receive any discount for early payment. Schedule 4.20(a) sets forth a true, correct and complete list of all material customer complaints received in writing or otherwise documented by the Company (or any Affiliate of the Company or the Seller with respect to the Business) during each of the 2013 and 2014 fiscal years and during fiscal year 2015 to date, including, the date such complaint was received by the Company, the customer name, a description of the complaint including the date of the complaint and a description of the resolution of each complaint.

(b)           Schedule 4.20(b) sets forth a list of the ten (10) largest suppliers (of goods, services, equipment or otherwise) of the Company for the years ended December 31, 2013 and 2014 and the nine months ended September 30, 2015 (collectively, the “ Major Suppliers ”) showing the total purchases made by the Company from each such Major Supplier during each such period. To the Company’s Knowledge, no Major Supplier has threatened to materially decrease or limit its sale of assets to the Company. Since December 31, 2013, other than as disclosed on Schedule 4.20(b) , no termination, cancellation or material limitation of, or any material modification or change in, the business relationship with the Company has occurred or, to the Knowledge of the Company, has been threatened by any Major Supplier. Schedule 4.20(b) sets forth a true, correct and complete list of all material complaints from Major Suppliers received in writing or otherwise documented by the Company (or Seller or any Affiliate thereof) during each of the 2012, 2013, and 2014 fiscal years and during fiscal year 2015 to date.

Section 4.21          Inventories . The Company has delivered, or made available, to Buyer a true, correct and complete list of all Inventories of the Company as of September 30, 2015. The Company’s Inventories consist solely of scrap metal.

Section 4.22          Products Liability and Warranty . To the Company’s Knowledge, (a) there are no developments, events, conditions, circumstances, activities, practices, or incidents that have given rise to any material liability of the Company based on or related to any defect in any product, part or component that is or was developed or sold by or on behalf of the Company, or any service provided by or on behalf of the Company; and (b) there have not been, and there are no, material defects in any such products, parts, components or services. Except as set forth on Schedule 4.22 , the Company has not made or provided any express written warranty that is currently in effect with respect to the quality of, or absence of defects in, any of the products, parts, components or services it has developed, sold or otherwise placed in the stream of commerce. A list of all of the Company’s warranty claims since January 1, 2012 is set forth on Schedule Section 4.22 . Each Product designed, manufactured, repaired or serviced by the Company (or otherwise in connection with the Business) (i) has been and is properly and accurately documented and such documentation includes accurate data to produce the Product’s bills of materials and manufacturing instructions; and (ii) has been designed, manufactured, produced, repaired or serviced in accordance with (A) the specifications in place at the time of such Product’s design, manufacture, repair or service (which specifications do not contain any material errors), (B) the material provisions of all applicable Law, policies, manufacture, repair, or service and (C) the Company’s internal quality control processes and policies. Schedule 4.22 sets forth (i) a list of all of the Company’s product types which at any time have been recalled, withdrawn or suspended by the Company (or any Affiliate thereof with respect to the Business), whether voluntarily or otherwise, including the date recalled, withdrawn or suspended and a brief description of all completed or pending proceedings seeking such recall, withdrawal, or suspension of any such product type, and (ii) a brief description of all completed or pending governmental proceedings of which the Company has Knowledge seeking the recall, withdrawal, suspension or seizure of any Company product.

Section 4.23          Computer System . All computer hardware and software and related materials used by the Company, including all such computer hardware, software and related materials (herein collectively referred to as the “ Computer System ”) are owned or licensed by the Company (and not any other Affiliate thereof) and are in good working order and condition, subject to normal wear and tear and, in the case of software, with no assurance of being error or virus free. The Computer System has the performance capabilities, processing capacity, resources, characteristics and functions necessary to the conduct of the business and operations of the Company. To the Company’s Knowledge, the use of the Computer System by the Company (including any software modifications) has not violated or infringed upon the rights of any third parties. The Company uses commercially reasonable efforts to maintain Computer System back-up and recovery capabilities to help ensure that a system problem does not impact customer facing capabilities or revenue streams. The Company uses commercially reasonable efforts to maintain Computer System and network security controls that help safeguard such Computer System against the risk of business disruption arising from virus attacks, unauthorized activities of any employee or contractor of the Company, hackers or any other Person.

Section 4.24          Absence of Certain Business Practices . To the Company’s Knowledge, neither the Company nor any Affiliate or agent of any of the Company, or any other Person acting on behalf of or associated with the Company, acting alone or together, has (a) received, directly or indirectly, any rebates, payments, commissions, promotional allowances or any other economic benefits, regardless of their nature or type, from any customer, supplier, employee or agent of any customer or supplier; or (b) directly or indirectly given or agreed to give any money, gift or similar benefit to any customer, supplier, employee or agent of any customer or supplier, any official or employee of any government (domestic or foreign), or any political party or candidate for office (domestic or foreign), or other Person who was, is or may be in a position to help or hinder the business of the Company (or assist the Company in connection with any actual or proposed transaction), in each case which is unethical, not at arms-length or in violation of law applicable to the Company.

Section 4.25          Names . All names under which (i) the Company does business, and has during the past five (5) years done business, and (ii) the Business operates, and has during the past five (5) years operated, are specified on Schedule 4.25 .

Section 4.26          List of Accounts . Schedule 4.26 contains a list of all bank and securities accounts, and all safe deposit boxes, maintained by the Company and a listing of the persons authorized to draw thereon or make withdrawals therefrom or, in the case of safe deposit boxes, with access thereto.

Section 4.27          Schedules . Disclosure of any fact or item in any paragraph or section of the Schedules shall, should the existence of the fact or item or its contents be relevant to any other paragraph or section, be deemed to be disclosed with respect to that other paragraph or section whether or not a specific cross reference appears, but only to the extent that it is reasonably apparent on its face that such fact or item applies to such other paragraph or section.

Article V
REPRESENTATIONS AND WARRANTIES OF THE SELLER

The Seller hereby represents and warrants to the Buyer as of the date of this Agreement as follows:

Section 5.01          Authority . The Seller has all requisite legal capacity, power and authority to execute and deliver this Agreement and to perform the Seller’s obligations hereunder.

Section 5.02          Binding Obligations . This Agreement and the Other Transaction Documents to which the Seller is a party have been duly executed and delivered by the Seller and constitute valid and binding agreements of the Seller, enforceable in accordance with their respective terms, except as their enforceability may be limited by bankruptcy, insolvency, moratorium or other laws relating to or affecting creditors’ rights generally and the exercise of judicial discretion in accordance with general equitable principles, and except to the extent that rights to indemnification or contribution may be prohibited by public policy or Federal securities laws.

Section 5.03          Purchased Shares . The Seller has full right, power and authority to sell, transfer, assign and deliver the Purchased Shares. The Seller is the sole registered and beneficial owner of the Purchased Shares and has good and valid title to such Purchased Shares, free and clear of all Liens (other than restrictions on transfer imposed by the Securities Act or state securities laws. The Seller is not a party to any voting trust agreement or other contract, agreement, arrangement, commitment, plan or understanding restricting or otherwise relating to voting, dividend or other rights with respect to the Purchased Shares.

Section 5.04          No Contravention . The execution, delivery and performance by the Seller of this Agreement and the Other Transaction Documents to which the Seller is a party, the consummation by the Seller of the transactions contemplated hereby and thereby to be performed by the Seller and the compliance with the provisions hereof and thereof by the Seller do not (a) conflict with, result in the breach of, or constitute a default under, or require any authorization, consent, approval, exemption or other action by or notice to any third party or Governmental Body, under the provisions of any agreement or other instrument to which the Seller is a party or by which the property of the Seller is bound or affected, or (b) violate any laws, regulations, orders or judgments applicable to the Seller.

Section 5.05          No Claims . There is no claim pending or, to the actual knowledge of the Seller, threatened against the Seller, or the Seller’s properties or assets, that if adversely determined, individually or in the aggregate, could reasonably be expected to materially impair the Seller’s ability to consummate the transactions contemplated by this Agreement.

Section 5.06          Brokers or Finders . The Seller has not incurred, directly or indirectly, any liability for brokerage or finders’ fees or agents’ commissions or any similar charges in connection with this Agreement, the Other Transaction Documents or any transaction contemplated hereby or thereby.

Article VI
REPRESENTATIONS AND WARRANTIES OF THE BUYER

The Buyer hereby represents and warrants to the Seller as follows:

Section 6.01          Organization and Standing . The Buyer is a corporation duly incorporated, validly existing and in good standing under the laws of the State of Florida, with full right, power and authority to enter into and perform and do all things contemplated under this Agreement and the Other Transaction Documents to which it is a party necessary to give effect to the provisions of this Agreement and such Other Transaction Documents.

Section 6.02          Authorization and Binding Obligations . The execution, delivery and performance by the Buyer of this Agreement and the Other Transaction Documents to which the Buyer is a party have been duly and validly authorized by all necessary action, including approval of the entire transaction by the requisite vote of the Board of Directors of the Buyer. This Agreement and the Other Transaction Documents to which the Buyer is a party have been duly executed and delivered by the Buyer, as the case may be, and constitute valid and binding agreements of the Buyer, enforceable in accordance with their respective terms, except as their enforceability may be limited by bankruptcy, insolvency, moratorium or other laws relating to or affecting creditors’ rights generally and the exercise of judicial discretion in accordance with general equitable principles, and except to the extent that rights to indemnification or contribution may be prohibited by public policy or Federal securities laws.

Section 6.03          No Contravention . The execution, delivery and performance of this Agreement and the Other Transaction Documents to which the Buyer is a party, the consummation of the transactions contemplated hereby and thereby and the compliance with the provisions hereof and thereof by the Buyer do not (a) violate any provision of the Articles of Incorporation or bylaws of the Buyer, (b) conflict with, result in the breach of, or constitute a default under, or require any authorization, consent, approval, exemption or other action by or notice to any third party or Government Body, under the provisions of any agreement or other instrument to which the Buyer is a party or by which the property of the Buyer is bound or affected that has not been obtained, or (c) violate any Laws, regulations, orders or judgments applicable to the Buyer.

Section 6.04          Securities Act Matters . The Buyer is purchasing the Purchased Shares for its own account, for investment only and not with a view to, or any present intention of, effecting a distribution of such Purchased Shares or any part thereof. The Buyer acknowledges that the Purchased Shares have not been registered under the Securities Act or the securities laws of any state or other jurisdiction and cannot be disposed of unless they are subsequently registered under the Securities Act and any applicable state laws or an exemption from such registration is available. The Buyer is an “accredited investor” within the meaning of Regulation D under the Securities Act. The Buyer (i) is offering to purchase and purchasing the Purchased Shares after having made an investigation of the business, finances and prospects of the Company, (ii) has been furnished information and materials relating to the business, finances and operation of the Company in response to its inquiries; (iii) has been given an opportunity to make any further inquiries desired of the Seller, management and any other personnel of the Company and has received responses to such inquiries that it deems satisfactory, and (iv) understands that it must bear the economic risk of the investment represented by the purchase of the Purchased Shares for an indefinite period.

Section 6.05          Brokers or Finders . The Buyer has not incurred, directly or indirectly, any liability for brokerage or finders’ fees or agents’ commissions or any similar charges in connection with this Agreement, the Other Transaction Documents or any transaction contemplated hereby or thereby.

Section 6.06          Wholly-Owen Subsidiary . The Buyer is a wholly-owned subsidiary of Parent.

Article VII
COVENANTS OF THE PARTIES

Section 7.01          Release . Effective as of the Closing, the Seller, for himself and for his heirs, successors and assigns, does hereby release and forever discharge the Company and its successors of and from any and all claims, actions, causes of action, demands, suits, covenants, agreements, representations, obligations, costs, liabilities, expenses, losses and debts of any nature whatsoever, both at law and in equity, relating to any matter, claim or right, whether presently known or unknown, which any of them now have, ever had or may have against such released parties arising from or relating to any facts or events occurring at or prior to the Closing; provided, however, that such release and discharge under this Section 7.01 (a) shall not apply to, affect or diminish the rights of the Seller under this Agreement or under any of the Other Transaction Documents, (b) shall not release or discharge the obligations of the Buyer or the Company under this Agreement or under any of the Other Transaction Documents, (c) shall not release or discharge any employee compensation or benefits accruing in the ordinary course, (d) shall not release or diminish any rights of the Seller to indemnification by the Company under applicable law or the Company’s Organizational Documents associated with the Seller’s service as an employee, officer or director of the any Company, or (e) shall not release or diminish any claim or action to enforce the Seller’s rights regarding items (a) through (d) of this Section 7.01 .

Section 7.02          Confidentiality . As of the Closing and at all times after the Closing, the Seller hereby agrees to retain in confidence, and not use for his benefit or the benefit of others, all confidential and proprietary information of the Company, including without limitation, (a) customer and supplier information, including lists of names and addresses of customers of the Company, (b) business plans and strategies, compensation plans, compensation information, sales plans and strategies, pricing and other terms applicable to transactions between existing and prospective customers, suppliers or business associates, (c) market research and databases, sources of leads and methods of obtaining new business, and methods of purchasing, marketing, selling, performing and pricing products and services employed by the Company, (d) information concerning the configuration and architecture, technical data, networks, methods, practices, standards and capacities of the Company’s information systems, software and other intellectual property, (e) information identified as confidential or proprietary in internal documents of the Company, and (f) all information that is or would be a trade secret or other proprietary intellectual property of the Company (the “ Confidential Information ”), and hereby agrees to not disclose such Confidential Information to anyone other than the other parties hereto, except with the express written consent of Buyer, except as required by applicable law or except in connection with disputes over the terms of, or to enforce such party’s rights with respect to the Company or rights under, this Agreement, or any Other Transaction Document; provided , however , that the Seller may disclose relevant Confidential Information to such party’s attorney, accountant or other representative, so long as such party advises that such information shall be kept confidential, such party hereby agreeing to be responsible for any breach of this covenant by such attorney, accountant or other representative; and provided further that the term “ Confidential Information ” shall not include any information which (a) becomes publicly known through no wrongful act of any party as a result of being readily ascertainable from public or published information, or trade sources or (b) is received from a third party not under an obligation to keep such information confidential. The Seller acknowledges that the success of the Company after the Closing Date depends upon the continued preservation of the confidentiality of certain information possessed by the Seller, that the preservation of the confidentiality of such information by the Seller is an essential premise of the bargain between the parties, and that Buyer would be unwilling to enter into this Agreement in the absence of this Section 7.02 .

Section 7.03          Non-Competition; Non-Solicitation; Standstill .

(a)           In furtherance of the sale of the Company to the Buyer hereunder by virtue of the transactions contemplated hereby and to more effectively protect the value of the business so sold, the Seller covenants and agrees that beginning on the Closing until five (5) years from and after the Closing Date (such period, the “ Restricted Period ”), Seller shall not, (A) directly or indirectly, as an owner, principal, partner, member, shareholder, independent contractor, employee, consultant, joint venturer, investor, licensor, lender or in any other capacity, alone, or in association with any other person, engage anywhere in the world (the “ Territory ”) in any activity competitive with the Business as conducted on January 1, 2016 (“ Competitive Activity ”), (B) be employed by or serve as an employee, agent, lender, investor, holder of equity or debt securities, representative, officer, director of, or as an advisor or consultant to, any Person which engages, plans to engage or is considering engaging in any Competitive Activity within the Territory, or (C) utilize his special knowledge of the Business and his relationships with customers, suppliers and others, or assist any other Person, to compete with, prevent the Company from obtaining, or divert business away from the Company in any facet of the Business as conducted on January 1, 2016. The covenants in this Section 7.03(a) shall not (i) be breached as a result of the beneficial ownership by the Seller of (A) less than one percent (1%) of any class of publicly traded equity or debt securities of a Person engaged in any Competitive Activity, provided that the Seller does not control such Person, or (B) any passive investment in any Person who, after the date of acquisition of such interest, commences any Competitive Activity, provided that neither Seller nor any of his Affiliates or family (including spouses, children, spouses of children and grandchildren)), individually or collectively beneficially own more than five percent (5%) of such Person and no designee of the Seller serves as a director or officer, or in any similar capacity, of such Person, or (ii) be breached by virtue of the Seller’s employment with the Company or any subsidiary of the Company or continued ownership of equity in the Company.

(b)           Without the prior consent of Buyer and other than on behalf of the Company or any subsidiary of the Company, the Seller agrees that he shall not, for a period of five (5) years from the Closing Date, directly or indirectly, for himself or for any other Person, (i) call on or solicit any of the employees of the Company or its Affiliates (or any Person who had been such an employee in the preceding six (6) months) for purposes of entering into employment, consulting or other business arrangements with such Persons, (ii) call on or solicit any of the actual or targeted prospective customers or clients of the Company for the purposes of engaging in any Competitive Activity, nor shall the Seller make known the names and addresses of such customers or clients or any information relating in any manner to the Seller’s trade or business relationships with such customers or clients as they directly pertain to the Business, (iii) hire any Person who was employed or engaged as a consultant by the Company in the preceding six (6) months prior to the Closing Date. Section 7.03 (b) (iii) shall not restrict Seller during the Restricted Period from engaging professionals that have provided accounting, tax or legal advice to the Company.

(c)           The restrictive covenants set forth in this Section 7.03 (the “ Restrictive Covenants ”) have been separately bargained for to protect the business, including goodwill, being retained by the Company and to ensure that the Company shall continue to have the full benefit of the value thereof. The Seller recognizes and acknowledges that the business and markets of the Company are international in scope, and that the Buyer is investing substantial sums in purchasing the Purchased Shares and in consideration for the Restrictive Covenants, that such covenants and the territory, time limitation and scope of restrictions set forth in this Section 7.03 are necessary in order to protect and maintain the legitimate business interests of the Company and are reasonable in all respects, and that the Buyer would not consummate the transactions contemplated hereby but for such agreements. The Seller agrees that any reduction to the territory, time limitation or scope of restrictions set forth herein would seriously undermine the efficacy of this Section 7.03 and the protections that it is intended to provide. The Seller acknowledges and agrees that the covenants contained in this Section 7.03 are essential elements of this Agreement and that, but for these covenants Buyer would not have agreed to purchase the Company. The Seller further expressly agrees and acknowledges that (a) the confidentiality, non-solicitation and non-competition covenants contained in this Section 7.03 (i) are supported by adequate consideration as a result of the benefit received by the Seller through the sale of the Purchased Shares, (ii) are necessary for the protection of the Buyer’s legitimate business interests, including the Company’s trade secrets, goodwill and relationships with customers and suppliers and (iii) are not unduly restrictive of any rights of the Seller, and (b) in entering into and negotiating this Agreement and the terms hereof, there has been no disparity in bargaining power between the parties and the Seller has been represented by counsel and fully understands the terms hereof. Each Party acknowledges and agrees that no portion of the Closing Date Purchase Price or the Final Purchase Price shall be allocated for tax purposes as consideration for the covenants set forth in this Section 7.03 . Notwithstanding the foregoing, if any covenant set forth in this Section 7.03 is breached by the Seller, such allocation shall not be deemed to be a measure of the damages that would result from such a breach, and none of them shall argue or in any way assert in any proceeding that such consideration is a measure of the damages resulting from such breach.

(d)           If the Seller breaches, or threatens to commit a breach of, any of the provisions of this Section 7.03 , the Buyer shall have, in addition to, and not in lieu of, any other rights and remedies available to it under law or in equity, the right to have the Restrictive Covenants specifically enforced by any court of competent jurisdiction, without having to prove actual damages or post a bond, it being agreed that any breach or threatened breach of the Restrictive Covenants would cause irreparable injury to the Company and that money damages would not provide an adequate remedy.

(e)           In addition to the remedies the Company may seek and obtain pursuant to Section 7.03(d) hereof, the Restricted Period for the Seller shall be extended by any and all periods during which the Seller shall be found by a final non-appealable judgment of a court possessing personal jurisdiction over him to have been in violation of the Restrictive Covenants.

(f)           Whenever possible, each provision of this Section 7.03 shall be interpreted in such manner as to be effective and valid under applicable law but if any provision of this Section 7.03 shall be prohibited by or invalid under applicable law, such provision shall be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or the remaining provisions of this Section 7.03 . If any provision of this Section 7.03 shall, for any reason, be judged by any court of competent jurisdiction to be invalid or unenforceable, such judgment shall not affect, impair or invalidate the remainder of this Section 7.03 but shall be confined in its operation to the provision of this Section 7.03 directly involved in the controversy in which such judgment shall have been rendered. In the event that the provisions of this Section 7.03 should ever be deemed to exceed the time or geographic limitations permitted by applicable law, then such provision shall be reformed to the maximum time or geographic limitations permitted by applicable Law.

Section 7.04          Tax Matters .

(a)           The Seller, at the Seller’s expense, shall prepare or cause to be prepared, and file or cause to be filed, all Tax Returns for the Company for all taxable periods ending on or before the Closing Date (including any Tax Return relating to any “S corporation” short taxable year of the Company). All such Tax Returns shall be prepared in a manner consistent with prior practice unless otherwise required under applicable Law. At least 30 Business Days prior to the due date for any such Tax Returns, the Seller shall deliver such Tax Returns to the Buyer for its review, comment and approval, which approval shall not be unreasonably withheld. To the extent permitted by applicable Law, the Seller shall include any income, gain, loss, deduction or other tax items for such periods on his Tax Returns in a manner consistent with the Schedule K-1s furnished by the Company to the Seller for such periods. The Seller shall be responsible for and shall pay any and all Taxes (i) shown on such Tax Returns or (ii) assessed against or imposed on the Company with respect to all taxable periods ending on or prior to the Closing Date and any and all Taxes of the Company for the period allocated to the Seller pursuant to Section 7.04(b) during the three-year plus 90 day period immediately following the filing date for the Federal income tax return of the Company for year 2015; provided, however, that, (1) such responsibility and commitment to pay shall be net of any refunds or credits to the benefit of Company with respect to any taxable year or period (or portion thereof) that ends on or before the Closing Date or with respect to the pre-Closing period of any Straddle Period, and (2) Seller shall not be liable for or pay any Taxes to the extent such Taxes are paid by the Company on or prior to the Closing Date or are reflected as a liability or reserve for Taxes in the Net Working Capital. Any payment required by the Seller pursuant to this Section 7.04(a) shall be paid to the Company not later than five (5) days before the due date for payment of Taxes with respect to such Tax Return, assessment or imposition.

(b)           The Seller and the Buyer will, unless prohibited by applicable Law, close the taxable period of the Company as of the close of business on the Closing Date and shall execute and deliver an election to close the books of the Company upon S corporation termination pursuant to Section 1362(e)(3), in connection therewith. If applicable Law does not permit the Company to close its taxable year on the Closing Date or in any case in which a Tax is assessed with respect to a taxable period which includes the Closing Date (but does not begin or end on that day) (a “ Straddle Period ”), the Taxes, if any, attributable to a Straddle Period shall be allocated (i) to the Seller for the period up to and including the Closing Date, and (ii) to the Buyer for the period subsequent to the Closing Date. Any allocation of income or deductions required to determine any Taxes attributable to a Straddle Period shall be made by means of a closing of the books and records of the Company as of the close of business on the Closing Date, provided that exemptions, allowances or deductions that are calculated on an annual basis (including depreciation and amortization deductions) and any real property, personal property and other Taxes not imposed on the basis of income or receipts shall be allocated between the period ending on the Closing Date and the period after the Closing Date in proportion to the number of days in each such period.

(c)           The Buyer, the Company and the Seller shall cooperate fully, as and to the extent reasonably requested by the other party, in connection with the filing of Tax Returns and any Tax Proceeding. Such cooperation shall include the retention and (upon the other party’s request) the provision of records and information which are reasonably relevant to any such Tax Proceeding and making employees available on a mutually convenient basis to provide additional information and explanation of any material provided hereunder. The Buyer, the Company and the Seller agree to retain all books and records with respect to Tax matters pertinent to the Company relating to any taxable period beginning before the Closing Date until the expiration of the statute of limitations of the respective taxable periods, and to abide by all record retention agreements entered into with any Governmental Body.

(d)           In the case of any inquiry, audit, claim for refund, or administrative or judicial proceeding involving any asserted or threatened Tax liability or refund with respect to the Company (any such audit, claim for refund, or proceeding relating to an asserted Tax liability referred to herein as a “ Contest ”) initiated after the Closing Date that relates to Taxes for which the Seller is responsible under Sections 7.04 or 8.02 , the Seller shall have the right to control the conduct of such Contest at its own expense, but the Buyer shall have the right to participate in such Contest at his own expense, and the Seller shall (i) keep Buyer fully informed regarding the status of such Contest, (ii) consult with the Buyer with respect to any issues raised in such Contest which could adversely affect the Company or its Affiliates or which could impact Tax periods (or portions thereof) after the Closing and (iii) not be able to settle, compromise and/or concede any portion of such Contest that may affect the Tax liability of the Company for any taxable year (or portion thereof) beginning after the Closing Date without the consent of the Buyer, which consent shall not be unreasonably withheld or delayed; provided, that, that if the Seller fails to assume control of the conduct of any such Contest within a reasonable period following the receipt by the Seller of notice of such Contest, the Buyer shall have the right to assume control of such Contest and shall be able to settle, compromise and/or concede such Contest in its sole discretion in good faith. In the event any party receives any notice from a Governmental Body regarding a Contest, such party shall promptly provide the other party with a copy of such notice and all related communications. A party’s failure to give prompt notice shall not constitute a defense (in whole or in part) to any Indemnity Claim by the Indemnified Party against the Indemnifying Party, except and only to the extent that such failure shall have caused or increased such liability or adversely affected the ability of the Indemnifying Party to defend against or reduce its liability.

Section 7.05          Employee Transition Matters . The Buyer agrees to, or will cause the Company to, continue to employ after Closing, all of the employees of the Company employed immediately prior to the Closing Date (such employees are collectively referred to as “ Transitioned Employees ”). Subject to the Employment Agreement in the case of the Seller, each such Transitioned Employee shall be employed after the Closing at the same salary levels and vacation time-off received by the Transitioned Employee immediately prior to the Closing Date. Each Transitioned Employee shall be eligible to participate in all of the employee benefit plans provided to similarly situated employees of the Buyer or Buyer’s direct or indirect subsidiaries in accordance with the terms and conditions of such plans. Notwithstanding the above in this Section 7.05 , but subject, however, to the Employment Agreement with the Seller, nothing in this Agreement limits the rights of the Company to terminate the employment of any Transitioned Employee at any time after Closing or to eliminate or change the conditions of employment of a Transitioned Employee at any time after the one-year anniversary of the Closing Date, including the amendment or termination of any benefit plans, for any reason that the Company may, in its sole discretion, unilaterally determine and implement. Subject to the terms of the Employment Agreement with Seller, nothing in this Section 7.05 creates or is intended to create any rights in third parties or third party beneficiaries, including, without limitation, any rights to be employed or respecting the terms, conditions and duration of employment.

Section 7.06          Independent Investigation . Buyer has completed its independent investigation of the Company and has informed the Seller in writing of all items that Buyer has identified which may conflict with or are not in compliance with the representations and warranties of the Seller and the Company in this Agreement. Buyer confirms that the Seller has made available to Buyer and its representatives the opportunity to ask questions of the officers and management employees of the Company and to acquire such additional information about the business and financial condition of the Company as Buyer has requested, and all such information has been received.

Article VIII
INDEMNIFICATION

Section 8.01          Survival . All representations, warranties and covenants or other agreements made by the parties herein (and in any closing certificate delivered pursuant hereto) shall survive the Closing and continue in full force and effect until the date that is 24 months from the Closing Date, except (i) for the representations and warranties set forth in Sections 4.01(a) (Valid Corporate Existence and Authorization), 4.04 (Capitalization), Section 4.08 (Tax Matters), 4.17 (Broker Fees), Section 5.01 (Authority), 5.03 (Purchased Shares), 5.06 (Brokers or Finders), Section 6.01 (Organization and Standing), Section 6.02 (Authorization and Binding Obligations), 6.03 (No Contravention) and 6.05 (Brokers or Finders) (the “ Fundamental Representations ”), which shall survive until the latter of (a) the expiration of the applicable statutes of limitations and (b) 24 months from the Closing Date, and (ii) as to any matters with respect to which a bona fide written claim shall have been made or action at law or in equity shall have been commenced before such date, in which event survival shall continue (but only with respect to, and to the extent of, such claim). Any claims or matters made or brought with respect to such representations, warranties and covenants and other agreements (including any closing certificate delivered pursuant hereto) after the expiration of such provision as set forth above in this Section 8.01 shall be deemed barred under this ARTICLE VIII .

Section 8.02          Indemnification by the Seller . Subject to the other terms of this ARTICLE VIII , after Closing,

(a)           the Seller hereby agrees to indemnify and hold harmless the Buyer (hereinafter the “ Buyer Indemnified Person ”) from and against any and all losses, costs, damages, penalties, fines, liabilities and expenses (including without limitation all reasonable legal or other professional fees and expenses) arising from claims, demands, causes of action, injunctions, judgments, orders or rulings (collectively, “ Damages ”) incurred or sustained by the Buyer Indemnified Person as a result of (i) any breach of any representation or warranty by the Company contained in ARTICLE IV herein or in any closing certificate delivered by the Company regarding ARTICLE IV , or (ii) any breach by the Seller of Section 7.04 ; and

(b)           the Seller hereby agrees to indemnify and hold harmless the Buyer Indemnified Person from and against any and all Damages incurred or sustained by Buyer Indemnified Person as a result of (i) any breach by the Seller of any representation or warranty contained in ARTICLE V herein or in any closing certificate delivered by the Seller regarding ARTICLE V , or (ii) any breach by the Seller of an Other Transaction Document to which the Seller is a party, or (iii) any breach by the Seller of a covenant or agreement of the Seller under this Agreement (other than Section 7.04 hereof).

Section 8.03          Indemnification by the Buyer . After Closing, the Buyer hereby agrees to indemnify and hold harmless the Seller from and against any and all Damages incurred or sustained by the Seller as a result of:

(a)           any breach of any representation or warranty by the Buyer contained herein, in any Other Transaction Document to which the Buyer is a party or in any certificate delivered by the Buyer hereunder or thereunder; or

(b)           a breach by the Buyer of any covenant or other agreement contained herein or in any Other Transaction Document to which or the Buyer is a party.

Section 8.04          Limitations on Indemnification .

(a)           The obligations of the Seller pursuant to the provisions of Section 8.02 are subject to the following additional limitations:

(i)           The Seller shall not be liable to the Buyer Indemnified Person under Section 8.02(a)(i) until, and only to the extent, Damages incurred or sustained by the Buyer Indemnified Person regarding the matters covered by such Section 8.02(a)(i) exceed an amount equal to one percent (1%) of the Final Purchase Price in the aggregate (the “ Deductible ”), provided that the Deductible shall not apply to Fundamental Representations or for any claims arising from Fraud;

(ii)          the aggregate liability of the Seller under Sections 8.02(a) and 8.02(b)(i) ; and

(iii)         shall be limited to an aggregate amount equal to twenty-five percent (25%) of the Final Purchase Price (the “ Cap ”), except that the Cap shall not apply to limit the extent of Damages caused by a Company or Seller breach of Fundamental Representations or for any claims arising from Fraud.

(b)           From and after the Closing, the Seller shall not have, and hereby releases, any right of contribution, indemnification or other recourse against the Company under applicable law, the Organizational Documents of the Company or any other agreement with respect to any valid claim for indemnification hereunder by the Buyer Indemnified Person where the matter at issue is Seller’s liability under this ARTICLE VIII .

Section 8.05          Procedure for Indemnification . The procedure to be followed in connection with any claim for indemnification by Buyer Indemnified Person under Section 8.02 or by the Seller under Section 8.03 (an “ Indemnity Claim ”) is set forth below:

(a)           A Person that may be entitled to indemnification pursuant to Section 8.02 or Section 8.03 (the “ Indemnified Party ”) shall promptly give written notice (a “ Notice of Claim ”) to the party liable for such indemnification (the “ Indemnifying Party ”). A Notice of Claim shall set forth (A) a description, in reasonable detail, of the facts and circumstances with respect to the subject matter of such Indemnity Claim or potential Indemnity Claim, and (B) the anticipated total amount of the Indemnity Claim (including any costs or expenses which have been or may be reasonably incurred in connection therewith). The Indemnified Party’s failure to give prompt notice shall not constitute a defense (in whole or in part) to any Indemnity Claim by the Indemnified Party against the Indemnifying Party, except and only to the extent that such failure shall have caused or increased such liability or adversely affected the ability of the Indemnifying Party to defend against or reduce its liability.

(b)           If the Indemnifying Party shall reject any Damages as to which a Notice of Claim is sent by the Indemnified Party, the Indemnifying Party shall give written notice of such rejection to the Indemnified Party within thirty (30) days after the date of receipt of the Notice of Claim. If no rejection is provided by the Indemnifying Party within such thirty (30) day period, the Indemnifying Party shall pay to the Indemnified Party within thirty (30) days the Damages set forth in such Notice of Claim.

(c)           If any Indemnified Party receives notice of the assertion or commencement of any action made or brought by any Person who is not a party to this Agreement or an Affiliate of a party to this Agreement or a representative of the foregoing (a “ Third Party Claim ”) against the Indemnified Party with respect to which the Indemnifying Party is obligated to provide indemnification under this Agreement, the Indemnified Party shall give the Indemnifying Party reasonably prompt written notice, but in any event not later than thirty (30) days after receipt of the notice of the Third Party Claim. The failure to give prompt written notice shall not, however, relieve the Indemnifying Party of its indemnification obligations, unless the Indemnifying Party was prejudiced thereby, and then only to the extent of such prejudice. The notice by the Indemnified Party shall describe the Third Party Claim in reasonable detail, shall include copies of all material written evidence thereof and shall indicate the estimated amount, if reasonably practicable, of the loss that has been or may be sustained by the Indemnified Party. The Indemnifying Party shall forthwith have the option to assume the Good Faith Defense (as defined below) of such Third Party Claim at its own expense, provided, that the Indemnified Party may retain its own counsel at the Indemnified Party’s expense. The Indemnified Party may elect at any time to assume the defense of the Third Party Claim upon written notice to the Indemnifying Party, which assumption shall be at the expense of the Indemnified Party unless the Indemnifying Party has not assumed the Good Faith Defense, and the Indemnified Party may settle or compromise such defense with the consent of the Indemnifying Party which consent shall not be unreasonably withheld or delayed. By virtue of the Indemnifying Party’s assumption of the Good Faith Defense of a Third Party Claim, the parties shall be deemed to have agreed as follows: (x) all claims made pursuant to such Third Party Claim are completely within the scope of and subject to indemnification and will be the sole and exclusive liability and responsibility of the Indemnifying Party subject to the limits and terms of this ARTICLE VIII ; (y) no compromise or settlement of such claims or action may be effected by the Indemnifying Party without the Indemnified Party’s consent which consent shall not be unreasonably withheld or delayed; and (z) the Indemnified Party will have no liability or adverse consequence with respect to any compromise or settlement of such claims or action effected without the Indemnified Party’s consent which consent shall not be unreasonably withheld or delayed. For purposes hereof, “ Good Faith Defense ” means legal defense conducted by reputable counsel of good standing, which consent shall not be unreasonably withheld or delayed. If a Good Faith Defense is not commenced within thirty business days following receipt of notice of the Third Party Claim from the Indemnified Party (or such shorter period, if any, during which a defense must be commenced in order for the defendant to preserve its rights), the Indemnifying Party shall be deemed to have waived its option to assume the Good Faith Defense with respect thereto. The parties shall provide such cooperation and such access to their books, records and properties as any party shall reasonably request with respect to such matter; and the parties hereto agree to cooperate with each other in all reasonable respects in order to help ensure the proper and adequate defense thereof and in furtherance of seeking a mutually acceptable solution. With regard to Third Party Claims for which indemnification is due and owing hereunder, such indemnification shall be paid by the Indemnifying Party upon the earliest to occur of: (a) the entry of a judgment of a court of competent jurisdiction against the Indemnified Party and the expiration of any applicable appeal period; (b) the entry of an nonappealable judgment of a court of competent jurisdiction against the Indemnified Party; or (c) a settlement of the Third Party Claim with the mutual written consent of Buyer and the Seller.

(d)           Notwithstanding anything contained herein to the contrary, for purposes of determining the amount of any Damages that are the subject matter of an indemnification obligation under this ARTICLE VIII (but not for purposes of determining whether a qualifying breach shall have occurred under Sections 8.02 or 8.03 ), each representation and warranty in this Agreement and the schedules and exhibits hereto shall be read without regard and without giving effect to any Materiality Qualifier contained in such representation or warranty which has the effect of making such representation and warranty less likely to be breached (as if such word or words were deleted from such representation or warranty). As used in this paragraph (d), “ Materiality Qualifier ” means any reference or qualification to a set of facts using the term “material,” “in all material respects,” “material adverse effect” or any similar phrase.

Section 8.06          Tax Treatment of Indemnification Payments . The Seller and the Buyer agree to treat any payment made pursuant to this ARTICLE VIII as an adjustment to the Final Purchase Price for U.S. federal, state and local income Tax purposes.

Section 8.07          Additional General Limitations . Except to the extent that Damages arise in a Third Party Claim for which indemnification is due, the Indemnified Party shall not seek, nor be entitled to, consequential, punitive, exemplary or special damages (including damages for any lost profits) in any claim for indemnification or recovery pursuant to this ARTICLE VIII . Any claim for Damages payable under this ARTICLE VIII shall be (i) net of any insurance proceeds actually received by such Indemnified Party with respect to such Damages (after deducting the amounts of policy deductibles, self-insured retentions and any out of pocket costs and expenses incurred in connection with the recovery of such proceeds), and (ii) calculated on an “After-Tax Basis”, which shall mean, with respect to the event giving rise to such Damages (the “ Indemnified Event ”), Damages shall be determined after taking into account, to the extent not previously taken into account in computing the amount of the such Damages, all reductions in federal, state, local and foreign Taxes (including estimated Taxes) realized by the Indemnified Party for all affected taxable years and periods as a result of the Indemnified Event. All calculations regarding such reductions shall be made at the time of the relevant indemnification payment using reasonable assumptions and present value concepts as reasonably agreed to by Buyer and Seller. In addition, Seller shall have no liability or obligation under this ARTICLE VIII for any Damages from any claim or matter for which the Final Net Working Capital reflects an accrual or other applicable adjustment.

Section 8.08          Exclusive Remedy . Except with respect to any equitable remedy to which the Buyer Indemnified Person shall be entitled for a breach by a Seller of any of Sections 7.02 or 7.03 hereof and except with respect to the Other Transaction Documents, the remedies and causes of action provided in this ARTICLE VIII shall be the exclusive remedies and causes of action of the parties hereto after the Closing in connection with the terms of, and the transactions contemplated by, this Agreement, including without limitation any breach or non-performance of any representation, warranty, covenant or agreement contained herein or in any closing certificate delivered pursuant hereto; and, to the extent allowed by applicable law, each indemnified party does hereby waive any and all such other statutory, common law and contractual rights and remedies with respect to the subject matter of this Agreement.

Section 8.09          Knowledge and Insurance . The right of an Indemnified Party to indemnification pursuant to this Article VIII will not be affected by any investigation conducted or knowledge acquired (or capable of being acquired) by such Indemnified Party, at any time, whether before or after the execution and delivery of this Agreement, with respect to the accuracy of any representation or warranty, performance of or compliance with any covenant or agreement referred to herein. Notwithstanding any provision of this Agreement or any other agreement between the parties to the contrary, in no event shall Seller have any obligation hereunder or otherwise, to indemnify and hold Buyer harmless from and against any Damages suffered or incurred directly or indirectly, as a result of or arising from any breach of any representation or warranty of the Seller or the Company under this Agreement, or any breach by the Seller or the Company of any of its covenants or other agreements set for in this Agreement, if and to the extent all or any part of such Damages are covered by insurance maintained by Buyer or the Company (and in each such case, the insured under such policy must first make good faith and diligent efforts to promptly claim and recover against the applicable insurer for any such matters).

Section 8.10          No Reliance . The Buyer has not relied on the Seller with respect to any matter in connection with the evaluation of the Company other than the representations and warranties of the Seller and the Company specifically set forth in Articles IV and V hereof, and the Buyer acknowledges that the Seller is making no representations or warranties, express or implied, of any nature whatever with respect to the Company other than the representations and warranties of specifically set forth in Articles IV and V.

Article IX
DEFINITIONS

Section 9.01          Definitions . For purposes hereof, the following terms when used herein shall have the respective meanings set forth below:

“ Affiliate ” of any particular Person means (1) any Person, other than an individual, owning directly, or indirectly controlling, at least fifty percent (50%) of the stock entitled to vote for election of directors of the subject Person, (2) any Person, other than an individual, owned or directly controlled by the subject Person through ownership of at least fifty percent (50%) of the stock entitled to vote for election of directors or any other entity actually controlled by the subject Person, or (3) any Person (other than the subject Person) owned or directly controlled by the Person mentioned in (1) above, through ownership of at least fifty percent (50%) of the stock entitled to vote for election of directors.

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

“ Anti-Corruption Laws ” has the meaning set forth in Section 4.15(c) .

“ Atomic Energy Act ” means the Atomic Energy Act of 1954, as amended.

“ Business ” means the businesses operated by the Company as of the Closing Date.

“ Business Day ” means any day other than a Saturday, Sunday, or a day on which the branch of the Federal Reserve Bank of Atlanta located in Miami, Florida is closed.

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

“ Buyer Indemnified Person ” has the meaning set forth in Section 8.02(a) .

“ Buyer QVF ” has the meaning set forth in Section 3.01(f)(ii) .

“ Byproduct Material ” means any radioactive material (other than Special Nuclear Material) yielded in, or made radioactive by, exposure to the radiation incident to the process of producing or utilizing Special Nuclear Material.

“ Call Right ” has the meaning set forth in Section 3.01(a) .

“ Cap ” has the meaning set forth in Section 8.04(a)(ii) .

“ Closing ” has the meaning set forth in Section 2.01 .

“ Closing Date ” has the meaning set forth in Section 2.01 .

“ Closing Date Net Working Capital ” has the meaning set forth in Section 2.04(b) .

“ Closing Date Purchase Price ” has the meaning set forth in Section 1.02 .

“ Closing Statement ” has the meaning set forth in Section 2.04(b) .

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

“ Common Stock of the Company ” means the shares of common stock of the Company, no par value.

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

“ Company Source Code ” has the meaning set forth in Section 4.10 .

“ Competitive Activity ” has the meaning set forth in Section 7.03(a) .

“ Computer System ” has the meaning set forth in Section 4.23 .

“ Confidential Information ” has the meaning set forth in Section 7.02 .

“ Contest ” has the meaning set forth in Section 7.04(d) .

“ Contract ” means any agreement, contract, lease, deed, license, instrument, note, indenture, obligation, or other legally binding commitment of a Person entered into with a third party, whether written or oral, to which such Person is bound or to which such Person’s assets or properties are subject and any amendments or supplements thereto.

“ Creditors ” has the meaning set forth in Section 2.02(i) .

“ Current Assets ” means the current assets of the Company as of the Closing Date determined in accordance with and based upon GAAP, excluding (i) amounts owed by any Seller and any accrued interest thereon, (ii) equipment and accumulated depreciation, (iii) office and computer equipment and accumulated depreciation, (iv) leasehold improvements and accumulated depreciation, and (vi) building and accumulated depreciation.

“ Current Liabilities ” means the current liabilities of the Company as of the Closing Date determined in accordance with and based upon GAAP, including accruals for accounts payable and credit card obligations, but excluding estimated transaction expenses.

“ Damages ” has the meaning set forth in Section 8.02(a) .

“ Deductible ” has the meaning set forth in Section 8.04(a)(i) .

“ Disclosure Schedules ” has the meaning set forth in Article V .

“ Dollars ” means the lawful currency of the United States of America.

“ Employment Agreement ” has the meaning set forth in Section 2.02(a) .

“ Environmental Laws ” means any applicable Law, and any order from any Government Body or binding agreement with any Governmental Body: (a) relating to pollution (or the cleanup thereof) or the protection of natural resources, endangered or threatened species, or the environment (including ambient air, soil, surface water or groundwater, or subsurface strata); or (b) concerning the presence of, exposure to, or the management, manufacture, use, containment, storage, recycling, reclamation, reuse, treatment, generation, discharge, transportation, processing, production, disposal or remediation of any Hazardous Substances. The term “Environmental Law” includes the following (including their implementing regulations and any state analogs): the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, as amended by the Superfund Amendments and Reauthorization Act of 1986, 42 U.S.C. §§ 9601 et seq .; the Solid Waste Disposal Act, as amended by the Resource Conservation and Recovery Act of 1976, as amended by the Hazardous and Solid Waste Amendments of 1984, 42 U.S.C. §§ 6901 et seq .; the Federal Water Pollution Control Act of 1972, as amended by the Clean Water Act of 1977, 33 U.S.C. §§ 1251 et seq .; the Toxic Substances Control Act of 1976, as amended, 15 U.S.C. §§ 2601 et seq .; the Emergency Planning and Community Right-to-Know Act of 1986, 42 U.S.C. §§ 11001 et seq. ; the Clean Air Act of 1966, as amended by the Clean Air Act Amendments of 1990, 42 U.S.C. §§ 7401 et seq .

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

“ ERISA Affiliate ” means a corporation or other person, firm or entity which, together with the Company, would be deemed to be a single employer within the meaning of Section 414(b), (c), (m) or (o) of the Code.

“ Estimated Net Working Capital ” has the meaning set forth in Section 2.04(a) .

“ Estimated Net Working Capital Deficit ” has the meaning set forth in Section 2.04(a) .

“ Estimated Net Working Capital Payment ” means 51% of the Estimated Net Working Capital.

“ Estimated Net Working Capital Surplus ” has the meaning set forth in Section 2.04(a) .

“ Exercise Note ” has the meaning set forth in Section 3.01(b)(i) .

“ Exercise Price ” has the meaning set forth in Section 3.01(f)(i) .

“ Exercising Party ” has the meaning set forth in Section 3.01(b)(i) .

“ Fair Market Value ” has the meaning set forth in Section 3.01(f)(i) .

“ Final Net Working Capital ” has the meaning set forth in Section 2.04(b) .

“ Final Net Working Capital Deficit ” has the meaning set forth in Section 2.04(b) .

“ Final Net Working Capital Payment ” means 51% of the Final Net Working Capital.

“ Final Net Working Capital Surplus ” has the meaning set forth in Section 2.04(b) .

“ Final Purchase Price ” has the meaning set forth in Section 2.04 .

“ Financial Statements ” has the meaning set forth in Section 4.05(a) .

“ Fraud ” means a knowing and willful false representation in this Agreement of a material fact, or knowing and willful concealment of a material fact that should have been disclosed, which deceives and is intended to deceive another so that such party shall act upon it to such party’s legal injury.

“ Fundamental Representations ” has the meaning set forth in Section 8.01 .

“ GAAP ” means United States generally accepted accounting principles.

“ Good Faith Defense ” has the meaning set forth in Section 8.05(a) .

“ Governmental Body ” means any (a) federal, state, local, municipal, foreign, or other government, or (b) governmental or quasi-governmental authority of any nature (including any governmental division, department, agency, commission, instrumentality, official, organization or regulatory body, and any court, arbitrator, or other similar governmental or quasi-governmental tribunal).

“ Government Official ” means any (i) officer or employee of a Governmental Body or instrumentality thereof (including any state-owned or state-controlled enterprise) or of a public international organization, (ii) candidate for political office or official of any political party, (iii) person acting for or on behalf of any Governmental Body or instrumentality thereof.

“ Greater Than Class C Waste ” means radioactive waste that contains a radionuclide whose concentration exceeds the value in Table 1 or Table 2 of 10 C.F.R. § 61.55, and therefore is currently not generally acceptable for disposal at existing (near surface) low level radioactive waste disposal facilities.

“ Hazardous Substances ” means any material, substance, chemical, waste, product, derivative, compound, mixture, solid, liquid, mineral or gas, in each case, whether naturally occurring or manmade, that is toxic, ignitable, reactive, corrosive, radioactive or caustic (including, petroleum, its derivatives, by-products and other hydrocarbons, poly-chlorinated bi-phenyls and asbestos), or regulated or defined as a hazardous substance, contaminant, toxic substance, toxic pollutant, hazardous waste, special waste, or pollutant pursuant to Environmental Laws.

“ High Level Waste ” means (a) irradiated nuclear reactor fuel, (b) liquid wastes resulting from the operation of the first cycle solvent extraction system, or its equivalent, and the concentrated wastes from subsequent extraction cycles, or their equivalent, in a facility for reprocessing irradiated reactor fuel, (c) solids into which such liquid wastes have been converted, or (d) any other material containing radioactive nuclides in concentrations or quantities that exceed NRC requirements for classification as Low Level Waste.

“ Incorporated Open Source Software ” has the meaning set forth in Section 4.10 .

“ Indebtedness ” means, as of any particular time, without duplication (i) the amount of all obligations for borrowed money, (ii) all liabilities evidenced by bonds, debentures, promissory notes, or other similar instruments or debt securities, (iii) all obligations, contingent or otherwise, in respect of any letters of credit or similar instruments (in each case to the extent drawn), (iv) all guarantees of the obligations of another Person with respect to any of the foregoing, (v) all obligations for or assumed as the deferred purchase price of property or services, and all interest thereon and fees and other expenses related thereto excluding open materials commitments (vi) all liabilities related to any unfunded or underfunded employee pension plan within the meaning of Section 3(2) of ERISA, and all interest thereon and fees and other expenses related thereto, and (vii) severance or other amounts payable to any employee terminated at or prior to Closing and all interest thereon and fees and other expenses related thereto; provided, however, Indebtedness shall in no event include any item that is accounted for in Net Working Capital.

“ Indemnified Event ” has the meaning set forth in Section 8.07.

“ Indemnified Party ” has the meaning set forth in Section 8.05(a) .

“ Indemnifying Party ” has the meaning set forth in Section 8.05(a) .

“ Indemnity Claim ” has the meaning set forth in Section 8.05 .

“ Independent QVF ” has the meaning set forth in Section 3.01(f)(ii) .

“ Insurance Policies ” has the meaning set forth in Section 4.13 .

“ Intellectual Property ” means all of the following, including such of the following that is owned by the Company and in which the Company holds exclusive or non-exclusive rights or interests granted by license from other Persons, including the Seller: (i) domestic and foreign patents, patent applications and patent or invention disclosures; (ii) registered and unregistered trademarks, registered and unregistered service marks, trade dress, trade names, brand names, corporate names, Internet domain names and other identifiers of source or goodwill, together with all goodwill associated with each of the foregoing; (iii) registered and unregistered copyrights; (iv) Software; (v) trade secrets, know-how, quality control, methods, processes and other confidential and proprietary information; (vi) registrations and applications for any of the foregoing; and (vii) and other similar know-how or intangible properties that are used by the Company for ownership, management or operation and the conduct of the Business.

“ Interim Financial Statements ” has the meaning set forth in Section 4.05(a) .

“ Inventory ” means all goods, merchandise and other personal property owned and held for sale by the Company, and all raw materials, works-in-process, materials and supplies of every nature owned by the Company which contribute to the finished products of the Company in the ordinary course of its business.

“ Knowledge ” or any similar phrase with respect to the knowledge of the Buyer shall mean the knowledge of any executive officer or director of the Buyer, and an individual shall be deemed to have “knowledge” of a particular fact, circumstance or other matter if: (i) such person is actually aware of such fact, circumstance or matter or (ii) an individual could have obtained such fact, circumstance or matter through a reasonable inquiry concerning the truth or existence of such fact, circumstance or other matter.

“ Knowledge of the Company ” or the “ Company’s Knowledge ” or any similar phrase with respect to the Knowledge of the Company shall mean the knowledge of any executive officer or director of the Company, including the Seller, and an individual shall be deemed to have “knowledge” of a particular fact, circumstance or other matter if: (i) such person is actually aware of such fact, circumstance or matter or (ii) an individual could have obtained such fact, circumstance or matter through a reasonable inquiry concerning the truth or existence of such fact, circumstance or other matter.

“ Latest Balance Sheet ” has the meaning set forth in Section 4.05(a) .

“ Law ” means any law, rule, regulation, ordinance, judgment, injunction, order, decree, administrative requirement, or other restriction of any Governmental Body, as enacted or promulgated and in effect on or prior to the Closing Date.

“ Liabilities ” has the meaning set forth in Section 4.05(b) .

“ Lien ” means any lien (statutory or other), security interest, purchase option, easement, encroachment of real property, right of first refusal, pledge, charging order, mortgage, deed of trust or other similar encumbrance or claim.

“ Low Level Waste ” means radioactive material that (a) is neither Spent Nuclear Fuel, nor byproduct material (as such term is defined in Section 11e.(2) of the Atomic Energy Act) and (b) the NRC, consistent with existing Law and in accordance with clause (a), classifies as low-level radioactive waste.

“ Major Customers ” has the meaning set forth in Section 4.20(a) .

“ Major Suppliers ” has the meaning set forth in Section 4.20(b) .

“ Materiality Qualifier ” has the meaning set forth in Section 8.05(d) .

“ Net Working Capital ” means Current Assets less Current Liabilities.

“ Neutral Accountants ” has the meaning set forth in Section 2.04(b) .

“ Confidentiality Agreement ” has the meaning set forth in Section 2.02(a) .

“ Notice of Claim ” has the meaning set forth in Section 8.05(a) .

“ Notice of Objection ” has the meaning set forth in Section 2.04(b) .

“ NRC ” means the United States Nuclear Regulatory Commission.

“ Nuclear Fuel ” means nuclear fuel assemblies, irradiated fuel assemblies that are capable of reinsertion into reactors without modification or additional cost, and unirradiated fuel assemblies awaiting insertion into reactors, as well as all nuclear fuel constituents (including uranium in any form and separative work units) in any stage of the fuel cycle that are in process of production, conversion, enrichment or fabrication.

“ Nuclear Insurance Policies ” means all nuclear insurance policies carried by or for the benefit of the Company with respect to the ownership, operation or maintenance of the Business, including all nuclear liability, property damage, decontamination, decommissioning and business interruption policies in respect thereof.

“ Nuclear Laws ” means all Laws relating to the following: the regulation of nuclear power plants, Source Material, Byproduct Material and Special Nuclear Materials; the regulation of Low Level Waste and Spent Nuclear Fuel; the transportation and storage of Nuclear Materials; the regulation of Safeguards Information; the regulation of Nuclear Fuel; the enrichment of uranium; the disposal and storage of Spent Nuclear Fuel; contracts for and payments into the Nuclear Waste Fund; and as applicable, the antitrust laws and the Federal Trade Commission Act to specified activities or proposed activities of certain licensees of commercial nuclear reactors, but shall not include Environmental Laws. Nuclear Laws include the Atomic Energy Act (42 U.S.C. §§ 2011 et seq .), the Price-Anderson Act (Section 170 of the Atomic Energy Act of 1954); the Energy Reorganization Act of 1974 (42 U.S.C. §§ 5801 et seq .); Convention on the Physical Protection of Nuclear Material Implementation Act of 1982 (Public Law 97-351; 96 Stat. 1663); the Foreign Assistance Act of 1961 (22 U.S.C. § 2429 et seq .); the Nuclear Non-Proliferation Act of 1978 (22 U.S.C. § 3201); the Low-Level Radioactive Waste Policy Act (42 U.S.C. §§ 2021b et seq .); the Nuclear Waste Policy Act (42 U.S.C. §§ 10101 et seq .); the Low-Level Radioactive Waste Policy Amendments Act of 1985 (42 U.S.C. §§ 2021d, 471); the Energy Policy Act of 1992 (4 U.S.C. §§ 13201 et seq .); the Energy Policy Act of 2005; regulations promulgated under each of the acts cited above and any state or local Law analogous to the foregoing.

“ Nuclear Material ” means Source Material, Special Nuclear Material, Low Level Waste, Greater Than Class C Waste, High Level Waste, Byproduct Material and Spent Nuclear Fuel.

“ Nuclear Waste Fund ” means the fund established by Section 302(c) of the Nuclear Waste Policy Act in which the Spent Nuclear Fuel Fees to be used for the design, construction and operation of a High Level Waste repository and other activities related to the storage and disposal of Spent Nuclear Fuel is deposited.

“ Option Closing Date ” has the meaning set forth in Section 3.01(b)(iii) .

“ Option Shares ” has the meaning set forth in Section 3.01(a) .

“ Organizational Documents ” means the Articles of Incorporation and bylaws (or equivalent governing instruments required or contemplated by applicable Law), as currently in force and effect, of the Company.

“ Other Transaction Documents ” means the Employment Agreement, the Confidentiality Agreement, the Shareholders’ Agreement and the Services Agreement.

“ Parent ” has the meaning set forth in Section 2.03(d).

“ Permits ” has the meaning set forth in Section 4.15(a) .

“ Permitted Liens ” means (i) Liens securing liabilities which are reflected or reserved against in the Latest Balance Sheet to the extent so reflected or reserved; (ii) Liens for Taxes not yet due and payable or which are being contested in good faith and by appropriate proceedings; (iii) mechanic’s, materialmen’s and similar Liens securing obligations not yet delinquent; (iv) purchase money Liens and Liens securing rental payments under capital lease arrangements; and (v) (A) zoning, building codes and other land use laws regulating the use or occupancy of real property or the activities conducted thereon which are imposed by any Governmental Body and (B) easements, covenants, conditions, restrictions and other similar matters of record affecting title to real property which, in the case of subclauses (A) and (B) of this clause (v) , are not violated by the current use or occupancy of such real property or the operation of the Business.

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

“ Plan ” has the meaning set forth in Section 4.12(a) .

“ Product ” means each product, process, application or service manufactured, licensed, distributed, performed, or sold by the Company (or any Affiliate thereof with respect to the Business) within the past five (5) years and any other products in which the Company (or any Affiliate thereof with respect to the Business) has or had any proprietary rights within the past five (5) years.

“Promissory Note” has the meaning set forth in Section 2.02(n) .

“ Proprietary Rights Agreement ” has the meaning set forth in Section 4.18(c) .

“ Purchase Price Deficit ” has the meaning set forth in Section 2.04(c)(i) .

“ Purchase Price Surplus ” has the meaning set forth in Section 2.04(c)(i) .

“ Purchased Shares ” has the meaning set forth in Section 1.01 .

“ Put Right ” has the meaning set forth in Section 3.01(a) .

“ Qualified Valuation Firm ” has the meaning set forth in Section 3.01(f)(ii) .

“ Real Property ” has the meaning set forth in Section 4.07(b) .

“ Records ” has the meaning set forth in Section 2.02(e) .

“ Related Party ” means (i) any Seller or any officer or director of the Company, (ii) any spouse, former spouse, child (natural or adopted), parent, parent of a spouse, sibling or grandchild of any of the Persons listed in clause (i) above, (iii) any Affiliate of any of the Persons listed in clause (i) or (ii) above (other than the Company), (iv) any corporation or organization of which such Person listed in clause (i) or (ii) above is an officer or partner or is directly or indirectly the beneficial owner of 10% or more of any class of equity securities, other than of the Company, and (v) any trust or other estate in which any of the Persons listed in clause (i) or (ii) above has a substantial beneficial interest or as to which such Person serves as trustee or in a similar fiduciary capacity, other than of the Company.

“ Release ” means any manner of spilling, leaking, dumping, discharging, releasing, migrating or emitting, as any of such terms may further be defined in any Environmental Law, into or through any medium including ground water, surface water, land, soil or air.

“ Responding Party ” has the meaning set forth in Section 3.01(b)(i).

“ Restricted Period ” has the meaning set forth in Section 7.03(a) .

“ Restrictive Covenants ” has the meaning set forth in Section 7.03(c) .

“ Safeguards Information ” means information that is required to be protected under the terms of 10 C.F.R. § 73.21.

“ Securities Act ” means the Securities Act of 1933, as amended.

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

“ Seller QVF ” has the meaning set forth in Section 3.01(f)(ii) .

“ Services Agreement ” has the meaning set forth in Section 2.02(k) .

“ Shareholders’ Agreement ” has the meaning set forth in Section 2.02(h) .

“ Software ” means computer software, applications and databases, together with, as applicable, object code, source code, firmware and embedded versions thereof and documentation related thereto.

“ Source Material ” means: (1) uranium, thorium, or any combination thereof, in any physical or chemical form, or (2) ores which contain by weight one-twentieth of one percent (0.05%) or more of uranium, thorium, or any combination thereof. “Source Material” does not include Special Nuclear Material.

“ Special Nuclear Material ” means plutonium, uranium-233, uranium enriched in the isotope-233 or in the isotope-235, and any other material that the NRC determines to be “Special Nuclear Material” but does not include Source Material. “Special Nuclear Material” also refers to any material artificially enriched by any of the above-listed materials or isotopes but does not include Source Material.

“ Spent Nuclear Fuel ” means fuel that has been permanently withdrawn from a nuclear reactor following irradiation, and has not been chemically separated into its constituent elements by reprocessing. Spent Nuclear Fuel includes the Special Nuclear Material, Byproduct Material, Source Material, Greater Than Class C Waste, and other radioactive materials associated with Nuclear Fuel assemblies.

“ Spent Nuclear Fuel Fees ” means those fees assessed on electricity sold pursuant to the Standard Spent Fuel Disposal Contract, as provided in Section 302 of the Nuclear Waste Policy Act and 10 C.F.R. Part 961.

“ Straddle Period ” has the meaning set forth in Section 7.04(b) .

“ Tax ” or “ Taxes ” includes (1) any federal, state, local or foreign income, capital, franchise, import, value added, estimated, alternative minimum, sales, use, transfer, registration, excise, stamp, windfall profit, customs, duties, real property, personal property, capital stock, social security, unemployment, disability, payroll, unclaimed property, escheat or other tax of any kind whatsoever, including any interest, penalties or additions to tax or additional amounts in respect of the foregoing, and (2) any liability for the payment of any amounts of the type described in (1) as a result of being a member of a consolidated, combined, unitary or aggregate group for any taxable period.

“ Tax Proceedings ” means any audit, claim for refund or contest or defense against any assessment, notice of deficiency, or other proposed adjustment relating to any and all Taxes of the Company.

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

“ Territory ” has the meaning set forth in Section 7.03(a) .

“ Third Party Claim ” has the meaning set forth in Section 8.05(a) .

“ Transitioned Employees ” has the meaning set forth in Section 7.05 .

“ Widely Varying Value ” has the meaning set forth in Section 3.01(f)(ii) .

“ Year-End Financial Statements ” has the meaning set forth in Section 4.05(a) .

Section 9.02          Other Definitional Provisions .

(a)           “Hereof,” etc. The terms “hereof,” “herein” and “hereunder” and terms of similar import are references to this Agreement as a whole and not to any particular provision of this Agreement unless otherwise explicitly specified. Section, clause, schedule and exhibit references contained in this Agreement are references to “, clauses, schedules and exhibits in or to this Agreement, unless otherwise explicitly specified.

(b)           “Including,” etc. The term “including” shall mean “including but not limited to.”

(c)           Gender . Any reference in this Agreement to gender shall include all genders.

(d)           Reference to a Person in a particular capacity excludes such Person in any other capacity or individually.

(e)           Reference to any agreement, document or instrument means such agreement, document or instrument as amended or modified and in effect from time to time in accordance with the terms thereof.

(f)           Reference to any Law for purposes of a post-Closing covenant under this Agreement means such Law as amended, modified, codified, replaced or reenacted, in whole or in part, and in effect as of the time for performance of such covenant, including rules and regulations promulgated thereunder;

(g)           “Or” is used in the inclusive sense of “and/or”.

(h)           References to documents, instruments or agreements shall be deemed to refer as well to all addenda, exhibits, schedules, or amendments thereto as then in effect.

Article X
MISCELLANEOUS

Section 10.01          Press Releases and Communications . Any public announcement, press release or similar publicity with respect to this Agreement or the contemplated transactions will be issued, if at all, at such time and in such manner as the Buyer determines with the approval of the Seller, such approval to not be unreasonably withheld or delayed, except that such approval shall not be required to the extent such public announcement and its content is required of the Buyer by applicable Law or by The Nasdaq Stock Market rules. Seller and Buyer will consult with each other concerning the means by which the Company’s employees, customers, suppliers and others having dealings with the Company will be informed of this Agreement and the contemplated transactions, and Buyer and Seller will have the right to be present for any such communication.

Section 10.02          Expenses . Except as otherwise expressly provided herein, all fees, costs and expenses (including fees, costs and expenses of legal counsel, accountants, investment bankers, brokers or other representatives and consultants) incurred in connection with the negotiation of this Agreement and the other agreements contemplated hereby, the performance of this Agreement and the other agreements contemplated hereby, shall be paid by the party incurring such expense.

Section 10.03          Notices . Except as otherwise expressly provided herein, all notices, demands and other communications to be given or delivered under or by reason of the provisions of this Agreement shall be in writing and shall be deemed to have been given (a) when personally delivered, (b) first Business Day after being transmitted via Email or telecopy (or other facsimile device) to the number set out below or transmitted by electronic mail if the sender on the same day sends a confirming copy of such notice by a recognized overnight delivery service (charges prepaid), (c) the day following the day (except if not a Business Day, then the next Business Day) on which the same has been delivered prepaid to a reputable national overnight air courier service or (d) the third (3 ^rd ) Business Day following the day on which the same is sent by certified or registered mail, postage prepaid, in each case to the respective parties at the address set forth below, or at such other address as such party may specify by written notice to the other party hereto:

Notices to the Buyer:

Consolidated Water U.S. Holdings, Inc.

Attn: Frederick W. McTaggart, President

5810 Coral Ridge Drive, Suite 220

Coral Springs, Florida 33076

Telephone: (954) 509-8200

Email: rmctaggart@cwco.com

Facsimile: (954) 509-8637

With a copy to:

Duane Morris LLP

Attn: Leslie J. Croland

200 South Biscayne Boulevard, Suite 3400

Miami, FL 33131-2318

Telephone: (305) 960-2250

Email: ljcroland@DuaneMorris.com

Facsimile: (305) 960-2201

Notices to the Seller:

Thomas Donnick, Jr.

2055 Mooringline Drive

Vero Beach, FL 32963

Telephone: (772) 461-0004 Ext. 13

Email: tdonnick@aerexglobal.com

with a copy (which shall not constitute notice) to:

Houston Harbaugh PC

Attn: Alex W. Thomson

Three Gateway Center

401 Liberty Ave., 22nd Floor

Pittsburgh, PA 15222

Telephone: (412) 288-2227

Email: athomson@hh-law.com

Facsimile: (412) 281-4499

Section 10.04          Assignment . This Agreement and all of the provisions hereof shall be binding upon and inure to the benefit of the parties hereto and their respective heirs, successors and permitted assigns, except that neither this Agreement nor any of the rights, interests or obligations hereunder may be assigned or delegated by the Buyer, on the one hand, and the Seller, on the other hand, without the prior written consent of the other party.

Section 10.05          Severability . Whenever possible, each provision of this Agreement shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Agreement is held to be prohibited by or invalid under applicable law, such provision shall be ineffective only to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or the remaining provisions of this Agreement. Notwithstanding the foregoing, if such provision could be more narrowly drawn so as not to be invalid, prohibited or unenforceable in such jurisdiction, it shall, as to such jurisdiction, be so narrowly drawn, without invalidating the remaining provisions of this Agreement or affecting the validity or enforceability of such provision in any other jurisdiction. The parties further agree to replace such void or unenforceable provision of this Agreement with a valid and enforceable provision that will achieve, to the extent possible, the economic, business and other purposes of such void or unenforceable provision.

Section 10.06          Construction . The headings of the sections and paragraphs of this Agreement have been inserted for convenience of reference only and shall in no way restrict or otherwise modify any of the terms or provisions hereof. The specification of any dollar amount or the inclusion of any item in the representations and warranties contained in this Agreement, the Disclosure Schedules or the attached exhibits is not intended to imply that the items so included, or other items, are or are not required to be disclosed (including whether such amounts or items are required to be disclosed as material or threatened) or are within or outside of the ordinary course of business, and no party shall use the fact of the inclusion of any item in this Agreement, the Disclosure Schedules or exhibits in any dispute or controversy between the parties as to whether any obligation, item or matter not set forth or included in this Agreement, the Disclosure Schedules or exhibits is or is not required to be disclosed (including whether the items are required to be disclosed as material or threatened) or is within or outside of the ordinary course of business for purposes of this Agreement. In addition, matters reflected in the Disclosure Schedules are not necessarily limited to matters required by this Agreement to be reflected in the Disclosure Schedules. Such additional matters are set forth for informational purposes only and do not necessarily include other matters of a similar nature. The information contained in this Agreement, in the Disclosure Schedules and exhibits hereto is disclosed solely for purposes of this Agreement, and no information contained herein or therein shall be deemed to be an admission by any party hereto to any third-party of any matter whatsoever (including any violation of law or breach of contract).

Section 10.07          Specific Performance . The parties agree that irreparable damage would occur in the event that any of the provisions of Section 7.03 of this Agreement were not performed in accordance with their specific terms or were otherwise breached. Accordingly, each of the parties shall be entitled to specific performance of the terms thereof, including an injunction or injunctions to prevent breaches of Section 7.03 of this Agreement and to enforce specifically the terms and provisions of Section 7.03 of this Agreement in any Iowa federal or state court contemplated by Section 10.13 . Each of the parties hereby further waives any defense in any action for specific performance that a remedy at law would be adequate regarding such Section 7.03 .

Section 10.08          Amendment and Waiver . Except as provided herein, and subject to applicable Law, any provision of this Agreement or the Disclosure Schedules or exhibits hereto may be amended or waived only in a writing signed by the Buyer and the Seller. No waiver of any provision hereunder or any breach or default thereof shall extend to or affect in any way any other provision or prior or subsequent breach or default.

Section 10.09          Complete Agreement . This Agreement and the other agreements, instruments and documents executed in connection herewith (including the Other Transaction Documents) contain the complete agreement between the parties hereto and supersede any prior understandings, agreements or representations by or between the parties, written or oral, which may have related to the subject matter hereof in any way.

Section 10.10         Third -Party Beneficiaries . Except as otherwise expressly provided herein, nothing expressed or referred to in this Agreement will be construed to give any Person other than the parties to this Agreement any legal or equitable right, remedy, or claim under or with respect to this Agreement or any provision of this Agreement.

Section 10.11          Counterparts . This Agreement may be executed in multiple counterparts, any one of which need not contain the signature of more than one party, but all such counterparts taken together shall constitute one and the same instrument. Any executed counterpart may be delivered by facsimile or other electronic transmission and such counterpart shall be deemed an original.

Section 10.12          Governing Law and Waiver of Jury Trial . All issues and questions concerning the construction, validity, interpretation and enforceability of this Agreement or the transactions contemplated hereby and the exhibits and schedules hereto, and all claims and disputes arising hereunder or in connection herewith, whether purporting to sound in contract or tort, or at law or in equity, shall be governed by, and construed in accordance with, the laws of the State of Florida, without giving effect to any choice of law or conflict of law rules or provisions (whether of the State of Florida or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of Florida. EACH OF THE PARTIES TO THIS AGREEMENT HEREBY IRREVOCABLY WAIVES ALL RIGHT TO A TRIAL BY JURY IN ANY ACTION, PROCEEDINGS OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.

Section 10.13          Venue and Jurisdiction . The parties agree that any action arising out of this Agreement shall be venued in the federal, state or local courts located in Palm Beach County, Florida and the parties hereby consent to personal jurisdiction in such courts and waive any objection based on the defense of an inconvenient forum and any objection to jurisdiction or venue of any action instituted hereunder. Each party hereby irrevocably consents to the service of process of any of the aforementioned courts in any such suit, action or proceeding by the mailing of copies thereof by registered or certified mail, postage prepaid, to the addresses set forth in Section 10.03.

Section 10.14          Attorney’s Fees . If any action at law or in equity is necessary to enforce or interpret the terms of this Agreement or any of the Other Transaction Documents, the prevailing party shall be entitled to reasonable attorneys’ fees, costs and necessary disbursements in addition to any other relief to which such party may be entitled.

Section 10.15          No Presumption Against Drafting Party . Each of the Buyer, the Company and the Seller acknowledges that each party to this Agreement has been represented by counsel in connection with this Agreement and the transactions contemplated by this Agreement. Accordingly, any rule of law or any legal decision that would require interpretation of any claimed ambiguities in this Agreement against the drafting party has no application and is expressly waived.

Section 10.16          Further Assurances . Following the Closing, each of the Parties will, and will cause their respective Affiliates to, execute and deliver such additional documents, instruments, conveyances, and assurances, and take such further actions, as may be reasonably required to carry out the provisions of this Agreement and give effect to the transactions contemplated by this Agreement.

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IN WITNESS WHEREOF , the parties hereto have executed this Stock Purchase Agreement on the day and year first above written.

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EXHIBITS