ASSET PURCHASE AGREEMENT

Asset Purchase Agreement

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HAYNES INTERNATIONAL INC | THE BRANFORD WIRE AND MANUFACTURING COMPANY | CAROLINA INDUSTRIES, INC

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Title: ASSET PURCHASE AGREEMENT
Governing Law: Indiana Date: 5/16/2005

ASSET PURCHASE AGREEMENT, Parties: haynes international inc , the branford wire and manufacturing company , carolina industries inc

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Exhibit 2.2

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ASSET PURCHASE AGREEMENT

BY AND AMONG

HAYNES WIRE COMPANY,

THE BRANFORD WIRE AND MANUFACTURING COMPANY,

CAROLINA INDUSTRIES, INC.,

AND

RICHARD HARCKE

DATED AS OF OCTOBER 28, 2004

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TABLE OF CONTENTS

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ARTICLE I. DEFINITIONS................................................................................1

ARTICLE II. SALE AND PURCHASE..........................................................................7

Section 2.01. Transfer of Assets.........................................................................7

Section 2.02. Sale Free of Encumbrances..................................................................7

Section 2.03. Certain Excluded Assets....................................................................7

Section 2.04. No Assumption of Liabilities...............................................................8

Section 2.05. Subsequent Documentation...................................................................8

Section 2.06. Post-Closing Adjustments to Purchased Inventory............................................8

ARTICLE III. PURCHASE PRICE.............................................................................9

Section 3.01. Purchase Price and Payment.................................................................9

Section 3.02. Fair Consideration.........................................................................9

Section 3.03. Allocation of the Purchase Price...........................................................9

Section 3.04. Taxes.....................................................................................10

ARTICLE IV. CLOSING...................................................................................10

Section 4.01. Closing Date..............................................................................10

Section 4.02. Deliveries by Sellers.....................................................................10

Section 4.03. Deliveries by Buyer.......................................................................11

Section 4.04. Possession of Acquired Assets.............................................................12

ARTICLE V. REPRESENTATIONS AND WARRANTIES OF SELLERS AND HARCKE......................................12

Section 5.01. Organization; Power.......................................................................12

Section 5.02. Authorization and Validity of Agreement...................................................12

Section 5.03. No Conflict or Violation..................................................................13

Section 5.04. Consents and Approvals....................................................................13

Section 5.05. Financial Statements......................................................................13

Section 5.06. Absence of Certain Changes or Events......................................................14

Section 5.07. Tax Matters...............................................................................14

Section 5.08. Absence of Undisclosed Liabilities........................................................15

Section 5.09. Real Property.............................................................................15

Section 5.10. Conformity of the Real Property...........................................................16

Section 5.11. Equipment and Machinery...................................................................16

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Section 5.12. Intellectual Property and Software........................................................16

Section 5.13. Accounts Receivable.......................................................................17

Section 5.14. Employee Benefit Plans....................................................................17

Section 5.15. Labor Relations...........................................................................18

Section 5.16. Environmental Compliance..................................................................18

Section 5.17. Licenses and Permits......................................................................19

Section 5.18. Insurance; Bonds..........................................................................19

Section 5.19. Assigned Contracts........................................................................19

Section 5.20. Customers.................................................................................19

Section 5.21. Compliance with Law.......................................................................19

Section 5.22. Litigation................................................................................20

Section 5.23. Title to the Acquired Assets and Related Matters..........................................20

Section 5.24. Absence of Certain Business Practices.....................................................20

Section 5.25. No Other Agreements to Sell Assets........................................................20

Section 5.26. Debts of Branford.........................................................................20

Section 5.27. Due Diligence.............................................................................20

Section 5.28. Broker's and Finder's Fees................................................................21

Section 5.29. All Material Information..................................................................21

Section 5.30. Sellers and Harcke Independently Advised..................................................21

Section 5.31. Condition of Acquired Assets..............................................................21

ARTICLE VI. REPRESENTATIONS AND WARRANTIES OF BUYER...................................................21

Section 6.01. Organization; Power.......................................................................21

Section 6.02. Authorization and Validity of Agreement...................................................21

Section 6.03. No Conflict or Violation..................................................................21

Section 6.04. Approvals and Consents....................................................................22

Section 6.05. Broker's and Finder's Fees................................................................22

ARTICLE VII. COVENANTS OF SELLERS AND HARCKE...........................................................22

Section 7.01. Regulatory and Other Approvals............................................................22

Section 7.02. Fulfillment of Conditions.................................................................22

Section 7.03. Conduct of Business.......................................................................23

Section 7.04. Certain Restrictions......................................................................23

Section 7.05. No Solicitation...........................................................................24

Section 7.06. Use of Names..............................................................................24

Section 7.07. Post-Closing Operations...................................................................25

Section 7.08. Notification..............................................................................25

ARTICLE VIII. COVENANTS OF BUYER........................................................................25

Section 8.01. Access....................................................................................25

Section 8.02. Fulfillment of Conditions.................................................................25

Section 8.03. Employee Matters..........................................................................26

Section 8.04. Assumed Liabilities.......................................................................27

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ARTICLE IX. CONDITIONS TO OBLIGATIONS OF BUYER........................................................27

Section 9.01. Representations and Warranties............................................................27

Section 9.02. Performance...............................................................................27

Section 9.03. Closing Deliveries........................................................................27

Section 9.04. Laws......................................................................................27

Section 9.05. Regulatory Consents and Approvals.........................................................27

Section 9.06. No Material Adverse Change................................................................27

Section 9.07. Balance Sheet.............................................................................27

Section 9.08. Bulk Sales Compliance.....................................................................27

Section 9.09. Approval of Board of Directors............................................................28

ARTICLE X. CONDITIONS TO OBLIGATIONS OF SELLERS AND HARCKE...........................................28

Section 10.01. Representations and Warranties............................................................28

Section 10.02. Performance...............................................................................28

Section 10.03. Laws......................................................................................28

Section 10.04. Regulatory Consents and Approvals.........................................................28

ARTICLE XI. EXCESS INVENTORY..........................................................................28

Section 11.01. Procedures for Storage and Disposition of Excess Inventory................................28

Section 11.02. Compliance................................................................................30

Section 11.03. Sales Efforts.............................................................................30

Section 11.04. Offset of Returns for Credit..............................................................30

ARTICLE XII. OTHER AGREEMENTS..........................................................................30

Section 12.01. Tax Returns; Cooperation on Tax Matters...................................................30

Section 12.02. Files and Records.........................................................................31

Section 12.03. Certain Costs.............................................................................31

Section 12.04. Payment of Debts..........................................................................31

Section 12.05. Collection of Certain Accounts Receivable.................................................31

Section 12.06. Costs of Clean-up of PCP Contamination....................................................32

ARTICLE XIII. INDEMNIFICATION...........................................................................32

Section 13.01. Survival..................................................................................32

Section 13.02. Indemnification by Sellers................................................................32

Section 13.03. Indemnification by Buyer..................................................................33

Section 13.04. Procedure.................................................................................34

Section 13.05. Buyer Right to Offset.....................................................................34

ARTICLE XIV. TERMINATION...............................................................................34

Section 14.01. Termination...............................................................................34

Section 14.02. Effect of Termination.....................................................................35

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ARTICLE XV. MISCELLANEOUS.............................................................................35

Section 15.01. Confidential Information..................................................................35

Section 15.02. Public Announcements......................................................................35

Section 15.03. Expenses..................................................................................35

Section 15.04. Utilities Proration.......................................................................35

Section 15.05. Reasonable Efforts; Cooperation...........................................................36

Section 15.06. Notices...................................................................................36

Section 15.07. Headings..................................................................................36

Section 15.08. Construction..............................................................................36

Section 15.09. Severability..............................................................................37

Section 15.10. Entire Agreement..........................................................................37

Section 15.11. Amendments; Waivers.......................................................................37

Section 15.12. Parties in Interest.......................................................................37

Section 15.13. Successors and Assigns....................................................................38

Section 15.14. Governing Law; Jurisdiction...............................................................38

Section 15.15. Counterparts..............................................................................38

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ASSET PURCHASE AGREEMENT

THIS ASSET PURCHASE AGREEMENT ("AGREEMENT"), dated as of October 28, 2004

(the "EFFECTIVE DATE"), is made and entered into by and among Haynes Wire

Company, a Delaware corporation ("BUYER"), The Branford Wire and Manufacturing

Company, a Connecticut corporation ("BRANFORD"), Carolina Industries, Inc., a

Connecticut corporation ("CAROLINA INDUSTRIES") (Branford and Carolina

Industries, collectively, "SELLERS") and Richard Harcke ("HARCKE").

WITNESSETH:

WHEREAS, Sellers are engaged in the business of owning and operating a wire

manufacturing business (the "BUSINESS"); and

WHEREAS, Buyer desires to purchase from Sellers, and Sellers desire to sell

to Buyer, the Acquired Assets, as hereinafter defined, upon the terms and

subject to the conditions set forth in this Agreement;

NOW, THEREFORE, in consideration of the foregoing and of the mutual

representations, warranties, covenants, and agreements herein contained and for

other good and valuable consideration, the receipt and sufficiency of which are

hereby acknowledged, and intending to be legally bound, the parties hereto agree

as follows:

AGREEMENT

ARTICLE I.

DEFINITIONS

As used in this Agreement, the following terms have the meanings indicated

below:

"ACCOUNTS RECEIVABLE" means all accounts and notes receivable, rights to

refunds, and deposits of any kind of Branford other than Excluded Accounts

receivable and Uncollectible Accounts Receivable.

"ACQUIRED ASSETS" means the Accounts Receivable, Assigned Contracts,

Equipment and Machinery, Files and Records, Intangible Assets, Intellectual

Property, Licenses and Permits, Miscellaneous Assets, Purchased Inventory, Real

Property, exclusive use of the names "Branford Wire and Manufacturing Company"

and "B&S Wire Rod Sales" and all other assets of Branford as of the Closing Date

(including all such items shown or reflected in the Closing Balance Sheet of the

Seller, with additions thereto, net of dispositions in the ordinary course of

the Business, since the Balance Sheet Date), of every kind, nature, character,

and description, whether real, personal or mixed, whether accrued, contingent or

other, and wherever situated, and whether or not reflected in any financial

statement of Branford, used or useful in conducting the Business

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including, without limitation, those listed on SCHEDULE 1.01 hereto, but

excluding all of the Excluded Assets.

"ACQUIRED WORKING CAPITAL" means, as of any date of determination, an

amount equal to the sum of (i) Sellers' Accounts Receivable PLUS (ii) Sellers'

Inventory (other than Excess Inventory), in each case as reflected on Seller's

balance sheet prepared in accordance with past practice.

"AFFILIATE" means any person that directly, or indirectly through one or

more intermediaries, controls, or is controlled by, or is under common control

with, a specified Person or which together with a specified Person is a member

of a controlled group (within the meaning of Code Section 1563(a) determined

without regard to Sections 1563(a)(4) and 1563(e)(3)(C)) of the Code.

"ASSIGNED CONTRACTS" means the leases, contracts, agreements and

arrangements assigned to Buyer by Seller hereunder and set forth in SCHEDULE

1.02.

"ASSUMED LIABILITIES" has the meaning specified in SECTION 2.04.

"BALANCE SHEET DATE" means September 30, 2004 (the date of the Interim

Balance Sheet).

"BRANFORD" has the meaning set forth in the introductory paragraph hereto.

"BRANFORD'S BENEFIT OBLIGATIONS" means all obligations, arrangements or

customary practices (other than those contained in or provided under Branford's

Plans), whether or not legally enforceable, to provide benefits (other than

salary or wages) to present or former directors, employees, or agents of

Branford. Branford's Benefit Obligations also includes consulting agreements

under which the compensation paid does not depend upon the amount of service

rendered, sabbatical policies, severance payment policies and fringe benefits

within the meaning of Section 132 of the Code.

"BRANFORD'S PLANS" means each voluntary employees' beneficiary association

under Section 501(c)(9) of the Code whose members include employees of Branford

and all employee benefit plans, as defined in Section 3(3) of ERISA, to which

Branford is a plan sponsor, as defined in Section 3(16)(B) of ERISA, or to which

Branford otherwise contributes or has contributed, or in which Branford

otherwise participates or has participated.

"BUSINESS" has the meaning set forth in the recitals hereto.

"BUSINESS DAY" means any day that the banks in Indianapolis, Indiana,

U.S.A. are open for business.

"BUYER" has the meaning set forth in the introductory paragraph hereto.

"BUYER BENEFIT PLANS" has the meaning specified in SECTION 8.03(b).

"CAROLINA INDUSTRIES" has the meaning set forth in the introductory

paragraph hereto.

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"CERCLA" means the Comprehensive Environmental Response Compensation and

Liability Act of 1980, as amended.

"CLAIM" has the meaning specified in SECTION 13.02.

"CLOSING" has the meaning specified in SECTION 4.01.

"CLOSING BALANCE SHEET" has the meaning specified in SECTION 3.02(b).

"CLOSING DATE" has the meaning specified in SECTION 4.01.

"CLOSING DATE A/R REPORT" has the meaning specified in SECTION 2.06(b).

"CLOSING DATE INVENTORY REPORT" has the meaning specified in SECTION

2.06(b).

"COBRA" means Title X of the Consolidated Omnibus Budget Reconciliation Act

of 1985, as amended.

"CODE" means the Internal Revenue Code of 1986, as amended.

"CONTRACTS" means any agreement, lease, license, evidence of indebtedness,

mortgage, indenture, security agreement or other contract.

"EFFECTIVE DATE" has the meaning specified in the first paragraph of this

Agreement.

"ENCUMBRANCES" means all liens (statutory or other), leases, mortgages,

pledges, security interests, conditional sales agreements, charges, claims,

options, easements, rights of way (other than easements of record), rights of

third parties and other encumbrances of any kind or nature whatsoever.

"ENVIRONMENTAL REQUIREMENTS" mean all past, present and future Laws, rules,

regulations, ordinances, policies, guidance documents, approvals, plans,

authorizations, Licenses and Permits issued by any Governmental Entity of the

United States, state or political subdivision thereof, and any foreign

governmental body and all judicial, administrative, and regulatory decrees,

judgments, and orders relating to human health, pollution, or protection of the

environment (including ambient air, surface water, ground water, land surface or

surface strata), including (i) Laws relating to emissions, discharges, releases,

or threatened releases of Hazardous Materials, (ii) Laws relating to the

identification, generation, manufacture, processing, distribution, use,

treatment, storage, disposal, recovery, transport or other handling of Hazardous

Materials, (iii) CERCLA; the Toxic Substances Control Act, as amended; the

Hazardous Materials Transportation Act, as amended; RCRA; the Clean Water Act,

as amended; the Safe Drinking Water Act, as amended; the Clean Air Act, as

amended; the Atomic Energy Act of 1954, as amended; and the Occupational Safety

and Health Act, as amended; and (iv) any similar Law.

"EQUIPMENT AND MACHINERY" means (i) all equipment, machinery, furniture,

fixtures and improvements, tooling, spare parts, supplies, computer hardware and

software, and motor vehicles (certificated or uncertificated) owned or leased by

Branford in connection with the

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Business (including all leases of such property), (ii) any rights of Branford to

warranties applicable to the foregoing (to the extent assignable), and licenses

received from the manufacturers or sellers of any such item, and (iii) any

related claims, credits, and rights of recovery with respect thereto.

"ERISA" means the Employee Retirement Income Security Act of 1974, as

amended.

"EXCESS INVENTORY" means the Inventory of Sellers that is not Purchased

Inventory, ownership of which shall remain in [CAROLINA INDUSTRIES] from and

after the Effective Date until purchased by Buyer or otherwise disposed of as

provided in SECTION 11.01.

"EXCLUDED ACCOUNTS RECEIVABLE" means the accounts receivable of Sellers

identified on SCHEDULE 1.03.

"EXCLUDED ASSETS" has the meaning specified in SECTION 2.03.

"FILES AND RECORDS" mean all files and records of the Seller relating to

the Business, whether in hard copy or magnetic or other format including

customer and supplier records, equipment maintenance records, equipment warranty

information, plant plans, specifications and drawings, sales and advertising

material, computer software and records relating to employees to be employed by

the Buyer following the Closing.

"FINAL A/R REPORT" has the meaning specified in SECTION 2.06(b).

"FINAL INVENTORY REPORT" has the meaning specified in SECTION 2.06(b).

"GAAP" means generally accepted accounting principles in the United States

of America, in effect from time to time, consistently applied.

"GOVERNMENTAL ENTITY" means any court, government agency, department,

commission, board, bureau or instrumentality of the United States, any local,

county, state, federal or political subdivision thereof, or any foreign

governmental body of any kind.

"HARCKE" has the meaning set forth in the introductory paragraph hereto.

"HAZARDOUS MATERIALS" mean (i) any substance that is or becomes defined as

a "hazardous substance," "hazardous waste," "hazardous material," pollutant, or

contaminant under any Environmental Requirements, including CERCLA; the

Superfund Amendments and Reauthorization Act, as amended; the RCRA; and any

analogous and applicable Law; (ii) petroleum (including crude oil and any

fraction thereof); and (iii) any natural or synthetic gas (whether in liquid or

gaseous state).

"HIRED EMPLOYEES" has the meaning specified in SECTION 8.03(a).

"INDEBTEDNESS" of any Person means, without duplication, all obligations of

such Person (i) for borrowed money, (ii) evidenced by notes, bonds, debentures

or similar instruments, (iii) for the deferred purchase price of goods or

services (other than trade payables incurred in the

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ordinary course of business), (iv) under capital leases and (v) in the nature of

guarantees of the obligations described in clauses (i) through (iv) above of any

other Person.

"INDEMNIFIED PARTY" has the meaning specified in SECTION 13.04.

"INDEMNIFYING PARTY" has the meaning specified in SECTION 13.04.

"INTANGIBLE ASSETS" mean all intangible personal property rights of the

Seller, including goodwill, customer lists and related information, and all

contract rights with respect to the Assigned Contracts.

"INTELLECTUAL PROPERTY" means any and all of the following and all rights

in, arising out of, or associated therewith: (i) all United States and foreign

patents and applications therefor and all reissues, divisions, renewals,

extensions, provisionals, continuations and continuations-in-part thereof; (ii)

all inventions (whether patentable or not), invention disclosures, improvements,

trade secrets, proprietary information, proprietary processes or formulae,

franchises, licenses, know how, technology, technical data and customer lists,

and all documentation relating to any of the foregoing; (iii) all copyrights,

corresponding thereto throughout the world; (iv) all trade names, logos, common

law trademarks and service marks; trademark and service mark registrations and

applications therefor and all goodwill associated therewith throughout the

world; (v) all databases and data collections and all rights therein throughout

the world; (vi) all computer software including all source code, object code,

algorithms, display screens, layouts, firmware, development tools, files,

records and data, all media on which any of the foregoing is recorded, all Web

addresses, sites and domain names; (vii) any similar, corresponding or

equivalent rights to any of the foregoing; and (viii) all documentation related

to any of the foregoing.

"INTERIM BALANCE SHEET" has the meaning specified in SECTION 5.05.

"INVENTORY" means all Inventory of Sellers, wherever located, including all

finished goods, work in process and raw materials.

"LAW" or "LAWS" means any local, county, state, federal or other law,

statute, regulation, ordinance, rule, order, decree, judgment, consent decree,

settlement agreement or governmental requirement enacted, promulgated, entered

into, agreed or imposed by any Governmental Entity.

"LICENSES AND PERMITS" mean all licenses, permits, franchises,

authorizations, and approvals issued by or under the authority of a Governmental

Entity that relate directly or indirectly to, or are necessary for, the conduct

of the Business, including those described in SCHEDULE 5.17.

"MATERIAL ADVERSE EFFECT," when used with respect to Sellers or the

Business, means any event, change, occurrence, condition or circumstance which

has had or may have a material adverse impact on any of the Acquired Assets, the

prospects, operations or financial condition of the Business as conducted by

Sellers immediately prior to the date hereof or the Closing, as applicable, or

the ability of Sellers to consummate any of the transactions contemplated by

this Agreement, and when used with respect to Buyer, means any event, change,

occurrence,

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condition or circumstance which has had or may have a material adverse impact on

the ability of Buyer to consummate any of the transactions contemplated by this

Agreement.

"MISCELLANEOUS ASSETS" means all telephone numbers, web site addresses and

post office boxes used by Branford in the Business, all materials and supplies

(other than Inventory) to be used or consumed by Sellers in the production of

finished goods and all prepaid expenses reflected on the Closing Balance Sheet

to the extent such expenses accrue to the benefit of Buyer after the Effective

Date.

"NONCOMPETITION AGREEMENTS" means the Confidentiality and Noncompetition

Agreements in the Form attached as EXHIBITS 4.02(g)(i) and 4.02(g)(ii).

"PERSON" means any individual, corporation, partnership, joint venture,

association, limited liability company, joint-stock company, trust, or

unincorporated organization, or any Governmental Entity.

"PERSONNEL" means the current and former officers, employees and/or agents

of any Seller.

"POLICIES" and "POLICY" have the meanings specified in SECTION 5.18.

"PURCHASE PRICE" has the meaning specified in SECTION 3.01.

"PURCHASED INVENTORY" means the Inventory of Sellers consisting of

inventory consigned to third parties for sale, work-in-process that is committed

to customer orders, work-in-process that is semi-finished goods, raw materials

necessary to fulfill Sellers' existing order backlog and other raw materials,

each as set forth on SCHEDULE 1.04, adjusted as provided in SECTION 2.06.

"RCRA" means the Resource Conservation and Recovery Act, as amended.

"REAL PROPERTY" has the meaning specified in SECTION 5.09.

"RELATED AGREEMENTS" means all agreements, instruments and certificates

(other than this Agreement) to be executed by Sellers or Harcke in connection

with the transactions contemplated by this Agreement, including without

limitation each Bill of Sale, each Assignment and Assumption Agreement and each

Noncompetition Agreement.

"REPLACEMENT COST" has the meaning specified in SECTION 11.01(c).

"SALE OF ASSETS" means the sale of the Acquired Assets by Sellers to Buyer

pursuant to the terms of this Agreement.

"SECURITY AGREEMENT" has the meaning specified in SECTION 4.02(a).

"SELLERS" has the meaning specified in the first paragraph of this

Agreement.

"SITE ASSESSMENT" has the meaning specified in SECTION 4.02(n).

"STORAGE SITE" has the meaning specified in SECTION 11.01(a).

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"TAX" or "TAXES" mean all federal, state, local and foreign taxes

(including excise taxes, value added taxes, occupancy taxes, employment taxes,

unemployment taxes, ad valorem taxes, custom duties, transfer taxes, and fees),

levies, imposts, fees, impositions, assessments and other governmental charges

of any nature imposed upon a Person including all taxes and governmental charges

imposed upon any of the personal properties, real properties, tangible or

intangible assets, income, receipts, payrolls, transactions, stock transfers,

capital stock, net worth or franchises of a Person (including all sales, use,

withholding or other taxes which a Person is required to collect and/or pay over

to any Governmental Entity), and all related additions to tax, penalties or

interest thereon.

"TAX RETURNS" mean all returns, reports, information returns, and other

documents (including all related and supporting information) filed or required

to be filed with any Governmental Entity in connection with the determination,

assessment, collection, or administration of any Taxes.

"TERMINATED EMPLOYEES" has the meaning specified in SECTION 8.03(e).

"UNCOLLECTIBLE ACCOUNTS RECEIVABLE" shall mean any account receivable of

Sellers that has been written off as uncollectible prior to the Closing Date and

included on the list of such accounts receivable delivered by the Sellers to the

Buyer pursuant to SECTION 12.05.

ARTICLE II.

SALE AND PURCHASE

SECTION 2.01. TRANSFER OF ASSETS. Subject to the terms and conditions set

forth in this Agreement, at the Closing, Sellers shall sell, convey, transfer,

assign and deliver to Buyer, and Buyer shall purchase, acquire and accept from

Sellers all of the right, title, and interest of Sellers in and to the Acquired

Assets.

SECTION 2.02. SALE FREE OF ENCUMBRANCES. Sellers and Harcke, jointly and

severally, represent, warrant and agree that the sale, conveyance, transfer,

assignment and delivery by Sellers of the Acquired Assets to Buyer as provided

herein is being made free and clear of all Encumbrances.

SECTION 2.03. CERTAIN EXCLUDED ASSETS. Notwithstanding any other

provision of this Agreement to the contrary, the Acquired Assets shall not

include the following assets of Sellers (collectively, the "EXCLUDED ASSETS"):

(a) all cash on hand or on deposit;

(b) rights under agreements with suppliers (other than Assigned

Contracts);

Seller;

(d) assets held in any employee benefit plan of any Seller;

(e) the Excess Inventory; and

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(f) the Excluded Accounts Receivable.

SECTION 2.04. NO ASSUMPTION OF LIABILITIES. Buyer is not assuming, and

shall not be responsible for in any manner, any obligations or liabilities of

any Seller, direct or indirect, known or unknown, choate or inchoate, absolute,

fixed or contingent, except (a) that Buyer agrees to assume and timely pay or

perform all obligations of Seller under the Assigned Contracts which (i)

initially accrue or arise after the Closing Date and (ii) are not the result of

or caused by any breach or default thereunder by any Seller, and (b) as set

forth in SCHEDULE 2.04 (such obligations, collectively, the "ASSUMED

LIABILITIES"). Any Excluded Assets that remain on the Real Property, as defined

herein, as of the Closing Date remain at Sellers' sole risk. Buyer will have no

liability for damage to or destruction of Excluded Assets whether caused by

Buyer's negligence or otherwise.

SECTION 2.05. SUBSEQUENT DOCUMENTATION. At any time and from time to time

after the Closing Date, Sellers shall, upon the request of Buyer, and Buyer

shall, upon the request of Sellers, promptly execute, acknowledge, and deliver,

or cause to be executed, acknowledged, and delivered, such further instruments

and other documents, and perform or cause to be performed such further acts, as

may be reasonably required to evidence or effectuate (a) the sale, conveyance,

transfer, assignment and delivery hereunder of the Acquired Assets, (b) the

performance by the parties of any of their other respective obligations under

this Agreement, and (c) the purposes and intent of this Agreement.

SECTION 2.06. POST-CLOSING ADJUSTMENTS TO PURCHASED INVENTORY.

(a) The amount of Purchased Inventory shall be increased or decreased

by a number of pounds having a value as of the Closing Date equal to (i) the

dollar amount by which Branford's Accounts Receivable as shown on the Final A/R

Report, is lower or higher, respectively, than Branford's Accounts Receivable as

shown on the Closing Date A/R Report; PLUS (ii) the amount by which the net book

value of the Equipment and Machinery included in the Acquired Assets is less

than $275,000. If the adjustment required by this SECTION 2.06 results in a net

decrease in Purchased Inventory, Buyer shall deliver to Sellers a quantity of

the Purchased Inventory (in the inverse order specified in SCHEDULE 1.04) equal

to the amount of such decrease and the Inventory so delivered shall become

Excess Inventory for all purposes of this Agreement. If the adjustment required

by this SECTION 2.06 results in a net increase in Purchased Inventory, Sellers

shall deliver to Buyer a quantity of Excess Inventory (in the order specified in

SCHEDULE 1.04) equal to the amount of such increase and the amount so delivered

shall become Purchased Inventory for all purposes of this Agreement. Any

transfer of Inventory as a result of the application of this SECTION 2.06 shall

be completed within five (5) Business Days of determination of the Closing

Balance Sheet, as provided for herein.

(b) On the Closing Date, Sellers shall deliver to Buyer a written

report showing all accounts receivable of Sellers outstanding on the Closing

Date, excluding Excluded Accounts Receivable (the "CLOSING DATE A/R REPORT"),

and a written report showing all Inventory of Sellers as of the Closing Date

divided into the categories identified on SCHEDULE 1.04 (the "CLOSING DATE

INVENTORY REPORT"). Not later than twenty (20) days after the Closing Date,

Buyer may disagree with the information set forth in the Closing Date A/R Report

or the Closing Date Inventory Report and notify Sellers in writing specifying in

reasonable detail the items in

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disagreement and the basis therefor. If Buyer so disagrees, Buyer and Sellers

shall meet and attempt in good faith to resolve the disagreement on a mutually

satisfactory basis. If Buyer and Sellers are unable to resolve the disagreement

within 10 days, Sellers and Buyer shall cause their respective accountants to,

within 15 days after the end of such 10-day period, agree upon a final Closing

Date A/R Report or Closing Date Inventory Report, in which case such agreed-upon

report shall be final and binding on the parties. In the event that their

respective accountants cannot agree upon such final report within such

timeframe, their respective accountants shall, within 2 days, jointly select an

independent auditor of recognized national standing to determine, within 10

days, a final report as of the Closing Date, in which case such determined final

report shall be final and binding on the parties. The final Closing Date A/R

Report and the final Closing Date Inventory Report prepared and finally

determined in accordance with this SECTION 2.06(b) are referred to herein

respectively as the "FINAL A/R REPORT" and the "FINAL INVENTORY REPORT".

ARTICLE III.

PURCHASE PRICE

SECTION 3.01. PURCHASE PRICE AND PAYMENT. Subject to the terms and

conditions set forth in this Agreement, as full consideration for the Acquired

Assets, Buyer shall:

(a) pay to Sellers at Closing in cash by wire transfer to an account

designated by Sellers at least two (2) Business Days prior to the Closing Date

an amount equal to Eight Million Three Hundred Thousand Dollars ($8,300,000);

and

(b) assume the Assumed Liabilities.

The amounts set forth in subsections (a) and (b) are referred to

collectively as the "PURCHASE PRICE."

SECTION 3.02. FAIR CONSIDERATION. All of the parties acknowledge and

agree that the consideration provided for in this ARTICLE III represents fair

consideration and reasonably equivalent value for the sale and transfer of the

Acquired Assets and the transactions, covenants and agreements set forth in this

Agreement, which consideration was agreed upon as the result of arm's-length,

good-faith negotiations between the parties and their respective

representatives.

SECTION 3.03. ALLOCATION OF THE PURCHASE PRICE. Buyer and Sellers agree

that the Purchase Price shall be allocated to the Acquired Assets sold by

Sellers as set forth on SCHEDULE 3.03 subject to adjustment by written consent

of both Sellers and the Buyer following a determination of the Closing Balance

Sheet and shall file Internal Revenue Service Form 8594 (and/or other

appropriate Tax Returns) with the applicable Taxing authorities, and shall not

file any amendments or take any action inconsistent with the foregoing in any

audit, refund claim, Tax Return, or any other administration or judicial

proceeding, pursuant to Section 1060 of the Code and underlying Treasury

Regulations promulgated thereunder. Sellers shall make its Tax Returns and

amendments thereof available for inspection by Buyer for the purpose of

verifying compliance with this SECTION 3.03.

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SECTION 3.04. TAXES. Sellers shall timely pay (a) all Taxes arising out

of (i) the ownership or use of the Excluded Assets, (ii) the ownership or use of

the Acquired Assets on or before the Closing Date, including all real or

personal property Taxes and payroll withholding Taxes due and payable (or

assessed for periods) on or before the Closing Date; and (b) all Taxes,

including gross and net income Taxes, and transfer, recording, sales and use

Taxes arising out of the sale or transfer of the Acquired Assets pursuant to

this Agreement or the other agreements and instruments contemplated hereby or

the recording or filing of any sale or transfer agreements or instruments.

ARTICLE IV.

CLOSING

SECTION 4.01. CLOSING DATE. The closing of the transactions contemplated

by this Agreement (the "CLOSING") shall take place at a date and time mutually

agreed upon by the parties to the Agreement following satisfaction or waiver of

all conditions set forth herein at the offices of Ice Miller, One American

Square, 34th Floor, Indianapolis, Indiana (the "CLOSING DATE").

SECTION 4.02. DELIVERIES BY SELLERS. At the Closing, and simultaneously

with delivery of possession of all of the Acquired Assets to Buyer, Sellers have

delivered (or caused to be delivered) to Buyer originals or copies, if

specified, of the following agreements, documents and other items:

(a) A Security Agreement by and among Sellers and Buyer (the "SECURITY

AGREEMENT"), executed by Buyer, in the form attached hereto as EXHIBIT 4.02(a);

(b) A Bill of Sale, executed by Sellers, in the form attached hereto as

EXHIBIT 4.02(b);

Directors and shareholders authorizing and approving the execution and delivery

of this Agreement and all agreements contemplated hereby and the consummation of

the transactions contemplated hereby and thereby, certified to be true and

complete and in full force and effect by the corporate Secretary of each Seller;

(d) An Assignment and Assumption Agreement, executed by Sellers, in the

form attached hereto as EXHIBIT 4.02(d);

(e) Copies of each consent, waiver, authorization and approval required

pursuant to SECTION 5.04 of this Agreement or necessary for the sale of the

Acquired Assets or the assignment of the Assigned Contracts to Buyer as

contemplated hereby;

(f) Certificates of Good Standing of each Seller issued by the

Secretary of State of the State of Connecticut or other appropriate Governmental

Authority, and Certificates of Authorization for each Seller from the North

Carolina Secretary of State, dated within fifteen (15) days of the Closing;

(g) Noncompetition Agreements, executed by each Seller and Harcke;

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(h) Certificates of title for the motor vehicles included in the

Acquired Assets, duly endorsed, and all other documents necessary to effect

transfer of title to any such motor vehicles;

(i) The original of the ALTA title insurance policy with respect to the

Real Property, as defined herein, issued by Chicago Title Insurance Company;

(j) A Certificate executed by Sellers acknowledging delivery by Buyer

of the items set forth in SECTION 4.03 of this Agreement and certifying that

Sellers have performed in all respects all of the covenants, agreements,

obligations and conditions required under this Agreement to be performed,

complied with or fulfilled by Sellers on or before the Closing Date;

(k) An opinion of counsel to Sellers, dated as of the Closing Date, in

substantially the form attached hereto as EXHIBIT 4.02(k);

(l) The Closing Date A/R Report and the Closing Date Inventory Report;

(m) A copy of the ALTA survey certified by Professional Surveying

Services for the Real Property, as defined herein;

(n) A copy of the Phase I environmental site assessment ("SITE

ASSESSMENT") of the Real Property;

(o) Evidence of zoning of the Real Property that is satisfactory to

Buyer, in its reasonable discretion;

(p) The list of Uncollectible Accounts Receivable provided for in

SECTION 12.05(d);

(q) The evidence of compliance with applicable bulk sales or bulk

transfer laws required by SECTION 9.08;

(r) Non-Foreign Affidavit executed by Sellers, in connection with the

transfer of the Real Property;

(s) Owner's Affidavit executed by Sellers, in connection with the

transfer of the Real Property;

(t) General Warranty Deed executed by Sellers, in connection with the

transfer of the Real Property; and

(u) Such other documents and certificates, as Buyer shall reasonably

request.

SECTION 4.03. DELIVERIES BY BUYER. At the Closing and simultaneously with

the payment of the Purchase Price to Sellers, Buyer has delivered (or has caused

to be delivered) to Sellers originals, or copies if specified, of the following

agreements, documents and other items:

(a) The Purchase Price to be paid at the Closing pursuant to SECTION

3.01 by wire transfer to accounts designated by Sellers;

<Page>

(b) The Security Agreement, executed by Sellers, in the form attached

as EXHIBIT 4.02(a);

Buyer authorizing and approving the execution and delivery of this Agreement and

all agreements contemplated hereby and the consummation of the transactions

contemplated hereby and thereby, certified to be true and complete and in full

force and effect by the corporate Secretary of Buyer;

(d) An Assignment and Assumption Agreement, executed by Buyer, in the

form attached hereto as EXHIBIT 4.02(d);

(e) A Certificate executed by Buyer acknowledging delivery by Sellers

of the items set forth in SECTION 4.02 of this Agreement and certifying that

Buyer has performed in all respects all of the covenants, agreements,

obligations and conditions required under this Agreement to be performed,

complied with or fulfilled by Buyer on or before the Closing Date;

(f) The Noncompetition Agreements, executed by Buyer;

(g) A Certificate of Good Standing of Buyer issued by the Secretary of

State of the State of Delaware, dated within fifteen (15) days of the Closing;

and

(h) Such other documents and certificates, as Sellers shall reasonably

request.

SECTION 4.04. POSSESSION OF ACQUIRED ASSETS. Immediately following the

Closing on the Closing Date, the Seller shall take all actions which are

required or requested by the Buyer to put the Buyer in full possession and

control of all of the Acquired Assets.

ARTICLE V.

REPRESENTATIONS AND WARRANTIES OF SELLERS AND HARCKE

As a material inducement to Buyer to enter into this Agreement and to

consummate the transactions contemplated hereby, Sellers and Harcke jointly and

severally represent and warrant to Buyer as follows:

SECTION 5.01. ORGANIZATION; POWER. Each Seller is a corporation duly

organized, validly existing and in good standing under the laws of the

jurisdiction of its incorporation. Each Seller is qualified as a foreign

corporation and is in good standing in each state or jurisdiction where

qualification is necessary because of the nature of the assets and properties it

owns, leases or operates or because of the nature of the business it conducts.

SECTION 5.02. AUTHORIZATION AND VALIDITY OF AGREEMENT. Each Seller has

all requisite corporate power and authority to own, lease and operate the

Acquired Assets, to carry on the Business as it is now being conducted, and to

enter into, execute and deliver this Agreement and all Related Agreements

executed by it, to consummate the transactions contemplated by this Agreement

and other Related Agreements and to comply with and fulfill the terms and

conditions of this Agreement and such Related Agreements. Harcke has the legal

capacity and authority to enter into this Agreement and each of the Related

Agreements, to be executed by

<Page>

Harcke and to carry out his obligations hereunder and thereunder. The execution,

delivery and performance of this Agreement and each Related Agreement by each

Seller and Harcke and the consummation by each Seller and Harcke of the

transactions contemplated by this Agreement and each Related Agreement have been

duly authorized by all necessary corporate action by the Board of Directors and

shareholders of each Seller, and no other corporate proceedings on the part of

any Seller are necessary to authorize such execution, delivery, performance or

consummation. This Agreement and each Related Agreement has been duly executed

and delivered by each Seller and Harcke, as applicable, and constitutes a legal,

valid and binding obligation of each Seller and Harcke, as applicable,

enforceable against each Seller and Harcke in accordance with their respective

terms and conditions.

SECTION 5.03. NO CONFLICT OR VIOLATION. The execution, delivery and

performance of this Agreement by each Seller and Harcke does not and will not:

(a) violate or conflict with any provision of the certificate of incorporation,

bylaws or other governing document of Sellers, (b) violate any provision of Law

of any Governmental Entity applicable to any Seller, Harcke, or the Business;

time or both) a default under any contract, lease, loan agreement, mortgage,

security agreement, trust, indenture, license, consent order or other instrument

or obligation to which any Seller or Harcke is a party, or by which any Seller

is bound or to which any Seller's or Harcke's assets or properties may be bound;

or (d) result in the imposition of any Encumbrance or restriction on the

Business or any of the Acquired Assets.

SECTION 5.04. CONSENTS AND APPROVALS. SCHEDULE 5.04 sets forth a list of

each consent, waiver, authorization or approval of any Governmental Entity or of

any other Person, and each declaration to or filing or registration with any

Governmental Entity required in connection with the execution and delivery of

this Agreement by any Seller or Harcke or the performance by any Seller and

Harcke of its or his obligations hereunder.

SECTION 5.05. FINANCIAL STATEMENTS. Attached hereto as SCHEDULE 5.05 are

true, correct and complete copies of (i) the balance sheets of Sellers as of

April 30, 2003 and 2002 and the related statements of income, changes in

stockholders' equity and cash flows for each of the fiscal years ended April 30,

2003, 2002 and 2001, together with a true and correct copy of the review letter

on such information by Sally Massagee, Sellers' independent public accountant,

(ii) the balance sheet of Sellers as of April 30, 2004 and the related statement

of income, changes in stockholders' equity and cash flows for the year then

ended, and (iii) the unaudited balance sheet of the Sellers as of July 31, 2004

(the "INTERIM BALANCE SHEET"), and the related unaudited statements of income,

changes in stockholders' equity and cash flows for the three (3) months then

ended, together with the notes thereto. All financial statements referred to in

this SECTION 5.05 have been prepared in a manner consistent with the manner in

which Sellers' Tax Returns are prepared. All of the financial statements fairly

present, in all material respects, the financial position of the Sellers as of

the respective dates thereof and the results of the Sellers' operations and

changes in the stockholders' equity and cash flows for the period then ended,

subject, in the case of clauses (ii) and (iii) above, to normal recurring

adjustments which are not, individually or in the aggregate, material.

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SECTION 5.06. ABSENCE OF CERTAIN CHANGES OR EVENTS. Except as set forth

on SCHEDULE 5.06, since the Balance Sheet Date, Sellers have operated the

Business in the ordinary course consistent with past practice and there has not

been any:

(a) (i) increase in the compensation payable or to become payable to

any Personnel engaged in the Business, (ii) bonus, incentive compensation,

service award or other like benefit granted, made or accrued, contingently or

otherwise, for or to any Personnel engaged in the Business, (iii) addition to or

modification of any of the Branford's Benefit Obligations and Branford's Plans

agreed to by any Seller for any Personnel engaged in the Business other than in

the ordinary course of the Business consistent with past practice, or (iv) new

employment agreement with any Personnel engaged in the Business;

(b) cancellation of any indebtedness or waiver of any rights having a

value of $5,000 or greater, whether or not in the ordinary course of the

Business, or increase in any obligation or liability of Branford except in the

ordinary course of the Business consistent with past practice;

any contract, license or other instrument material to the Business;

(d) failure to preserve the Business intact, to keep available to Buyer

the services of the Personnel and to preserve for Buyer the goodwill of each of

the Branford's dealers, suppliers, customers and others having business

relations with it;

(e) change in accounting methods or practices;

(f) damage, destruction or loss (whether or not covered by insurance)

affecting the Acquired Assets or the Business;

(g) sale, assignment, transfer or encumbering (or subjecting to any

Encumbrance) of any of the assets or properties except in the ordinary course of

the Business consistent with past practice;

(h) agreement by any Seller to do any of the foregoing; or

(i) other event or condition of any character which in any one case or

in the aggregate has had or may have a Material Adverse Effect on any Seller,

the Business or any of the Acquired Assets.

SECTION 5.07. TAX MATTERS. Each Seller has duly and timely filed all Tax

Returns required to have been filed with any federal, state, local or foreign

Taxing authority on or before the Closing Date and has timely paid all Taxes due

and payable by it on or before the Closing Date, whether or not shown on such

Tax Returns. Branford has set up reserves or accruals on the Agreement Balance

Sheet which are adequate for the payment of all Taxes for all periods through

the Closing Date. No Taxing authority has asserted any claim against any Seller

for the assessment of any additional Tax liability or initiated any action or

proceeding which could result in such an assertion. E

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