Exhibit 10.36

ASSET PURCHASE AGREEMENT

by and among

AIR PRODUCTS AND CHEMICALS, INC.

and

KMG CHEMICALS, INC.

Dated as of October 19, 2007

TABLE OF CONTENTS

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ASSET PURCHASE AGREEMENT

This ASSET PURCHASE AGREEMENT dated as of October 19, 2007 (this “ Agreement ”), is entered into by and among AIR PRODUCTS AND CHEMICALS, INC., a Delaware corporation (“ Seller ”), and KMG CHEMICALS, INC., a Texas corporation (“ Purchaser ”).

WHEREAS Purchaser wishes to purchase from Seller and the subsidiaries of Seller set forth in Attachment A (the “ Seller Subsidiarie s ”), and Seller wishes to sell and to cause the Seller Subsidiaries to sell to Purchaser certain of the assets and liabilities of the Business (as defined in Section 10.06(b)) of the Seller, upon the terms and subject to the conditions of this Agreement.

NOW, THEREFORE, in consideration of the mutual agreements, covenants, representations and warranties contained herein, and in reliance thereon, Seller and Purchaser, intending to be legally bound, hereby agree as follows:

ARTICLE I

Purchase and Sale of Assets; Closing

SECTION 1.01.   Purchase and Sale of the Transferred Assets .  Upon the terms and subject to the conditions of this Agreement, at the Closing (as defined in Section 1.06), (i) Seller shall sell, transfer, assign and deliver to Purchaser, and Purchaser will purchase, acquire and accept from Seller, all of Seller’s right, title and interest in, to and under the Transferred Assets (as defined in Section 1.02(a)) and (ii) Seller will cause the Seller Subsidiaries to sell, transfer, assign and deliver to Purchaser, and Purchaser will purchase, acquire, and accept from Seller Subsidiaries, all of Seller Subsidiaries’ right, title and interest in, to and under the Transferred Assets for (A) an aggregate purchase price of $74.6 million in cash (the “ Purchase Price ”) payable as set forth in Section 1.07 and subject to adjustment as set forth in Section 2.01 and (B) the assumption of the Assumed Liabilities (as defined in Section 1.04(a)).  The purchase and sale of the Transferred Assets and the assumption of the Assumed Liabilities are collectively referred to in this Agreement as the “ Acquisition ”.

SECTION 1.02.   Transferred Assets and Excluded Assets.

(a) The term “ Transferred Assets ” means all the business, properties, assets, goodwill and rights of Seller and the Seller Subsidiaries of whatever kind and nature, real or personal, tangible or intangible, that are owned, leased or licensed by Seller or any Seller Subsidiaries that are used or held for use primarily in the operation or conduct of the Business, other than (A) the Excluded Assets (as defined in Section 1.02(b)) and (B) as otherwise provided for in this Section 1.02(a), consisting of:

(i) all owned real property, leaseholds and other interests in real property of Seller or any Seller Subsidiary listed in Section 3.06(a) of the Seller Disclosure Letter or Section 3.06(b) of the Seller Disclosure Letter, in each case together with Seller’s or Seller Subsidiary’s right, title and interest in, to and under all buildings,

improvements and fixtures thereon and all other appurtenances thereto (the “ Transferred Real Property ”);

(ii) all raw materials, work-in-process, finished goods and products, supplies, parts and other inventories (“ Inventory ”) of Seller or any Seller Subsidiary that as of the close of business on the Closing Date is located on the Transferred Real Property and all other Inventory owned, leased or licensed by Seller or any Seller Subsidiary, in each case that are used or held for use in the operation or conduct of the Business (the “ Transferred Inventory ”);

(iii) all other tangible personal property and interests therein, including all machinery, equipment, furniture, furnishings and vehicles (“ Equipment ”), of Seller or any Seller Subsidiary that as of the time of the Closing is located on the Transferred Real Property and all other Equipment used or held for use primarily in the operation or conduct of the Business (the “ Transferred Equipment ”);

(iv) all accounts receivable of Seller or any Seller Subsidiary as of the close of business on the Closing Date that arise primarily out of the operation or conduct of the Business (the “ Transferred Receivables ”);

(v) all patents (including all reissues, divisions, continuations and extensions thereof), patent applications, patent rights, trademarks, trademark registrations, trademark applications, service marks, service mark registrations and service mark applications, trade names, business names, brand names, copyrights, database rights and moral rights in both published works and unpublished works (including all such rights in user and training manuals, marketing and promotional materials, internal reports and business plans), and all registrations or applications for registration of copyrights thereof and any renewals or extensions thereof in any jurisdiction, designs, design registrations, all rights to any of the foregoing, all rights in any jurisdiction to limit the use or disclosure of any Technology (as defined in Section 1.02(a)(vi)) by a third party, any similar intellectual property or proprietary rights similar to any of the foregoing, licenses, immunities, covenants not to sue and the like relating to the foregoing, all goodwill related to any of the foregoing and any Claims past, present or future arising out of or related to any infringement, misuse or misappropriation of any of the foregoing (collectively, the “ Intellectual Property ”), in each case, that are owned, leased or licensed by Seller or any Seller Subsidiary as of the time of the Closing, to Purchaser and are used or held for use in the operation or conduct of the Business (other than Licensed Assets (as defined in Section 10.06(b)), including those that are listed on Section 3.07(a) of the Seller Disclosure Letter (the “ Transferred Intellectual Property ”);

(vi) all trade secrets, inventions, discoveries, ideas (whether patentable or not in any jurisdiction and whether or not reduced to practice), know-how, customer lists, technical information, proprietary information, formulae, processes, procedures, research records, records of inventions, test information, market surveys and marketing know-how (“ Technology ”) owned, leased or licensed by Seller or any Seller Subsidiary and used or held for use in the operation or conduct of the Business (other than Licensed Assets) (the “ Transferred Technology ”);

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(vii) all permits, licenses, franchises, approvals or authorizations from any Governmental Entity (as defined in Section 3.03) (“ Permits ”) and Environmental Permits issued to Seller or any Seller Subsidiary and that are (x) used or held for use primarily in the operation or conduct of the Business (to the extent such Permits and Environmental Permits are transferable as of the Closing) or (y) listed on Section 1.02(a)(vii) of the Seller Disclosure Letter (the “ Transferred Permits ”);

(viii) all written contracts, leases, subleases, licenses, indentures, agreements, commitments and all other legally binding instruments (in each case other than leases, subleases, licenses and interests in respect of real property) (“ Contracts ”) to which Seller or any Seller Subsidiary is a party or by which Seller or any Seller Subsidiary is bound that are listed in Section 3.08(a) of the Seller Disclosure Letter, and all other Contracts to which Seller or any Seller Subsidiary is a party or by which Seller or any Seller Subsidiary is bound (x) to the extent used or held for use in, or arise out of, the operation or conduct of the Business, in the case of Contracts with customers of the Business, and (y) that are used or held for use in, or arise out of, the operation or conduct of the Business, in the case of Contracts that are not with customers of the Business (collectively, the “ Transferred Contracts ”);

(ix) all credits, prepaid expenses, deferred charges, advance payments, security deposits and prepaid items of Seller or any Seller Subsidiary that are used, held for use or intended to be used primarily in, or that arise primarily out of, the operation or conduct of the Business; and

(x) all books of account, ledgers, general, financial and accounting records, files, invoices, customers’ and suppliers’ lists, other distribution lists, billing records, sales and promotional literature (in all cases, in any form or medium, provided, that, in the case of data included in the general ledger system, Seller shall only transfer printed copies of such data) of Seller or of any Seller Subsidiary that are located on the Transferred Real Property or are located elsewhere, segregable, and used, held for use or intended to be used exclusively in, or that arise exclusively out of, the conduct or operation of the Business (the “ Records ”); provided that, except as provided in Section 6.01(a)(i), the Records shall not include any personnel records

(xi) with reference to Business Employees who are employed primarily outside the United States: (A) the employment contracts relating to the Business Employees (the “Employee Contracts”); (B) any agreements for workforce supply entered into between Seller or Seller Subsidiary and any temporary workforce supply agencies (agenzie di somministrazione de personale) relating to temporary workers; (C) any credits indemnities or sums accrued with respect to the Business Employees as of the Closing Date due to Seller or Seller Subsidiary in connection with the Employment Contracts as of the Closing Date, such as:(a) advance payments of severance pay indemnity (TFR); (b) advance payments of accidents’ insurance premiums; (c) advance payments of compensation; (d) so called TFR “Solidarieta”; (e) credits for advance payment of tax on salaries and TFR; and (f) loans to Business Employees for purchase of their houses.

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(b) Notwithstanding any other provision of this Agreement, Purchaser is purchasing only the Transferred Assets, and is not purchasing any asset of Seller or any Seller Subsidiary not included in the Transferred Assets pursuant to Section 1.02(a) (all such assets not included in the Transferred Assets being herein referred to as the “ Excluded Assets ”), none of which Excluded Assets shall be transferred, conveyed, set over, delivered or assigned to Purchaser.  The Excluded Assets shall include the following businesses, properties, assets, goodwill and rights of Seller and the Seller Subsidiaries that are owned, leased or licensed by Seller or any Seller Subsidiaries as of the Closing Date:

(i) all assets listed in Section 1.02(b) of the Seller Disclosure Letter;

(ii) all cash and cash equivalents of Seller or any Seller Subsidiary;

(iii) all insurance policies of Seller or any Seller Subsidiary and all rights and Claims thereunder and, subject to Section 5.12, any proceeds thereof;

(iv) all rights, Claims and credits of Seller or any Seller Subsidiary to the extent relating to any Excluded Asset or any Retained Liability, including any such items arising under any guarantees, warranties, indemnities and similar rights in favor of Seller or any Seller Subsidiary in respect of any Excluded Asset or any Retained Liability (as defined in Section 1.02(b)(iv));

(v) all shares of capital stock of, or other equity interests in, any affiliate of Seller or any other person, which are owned by Seller or any Seller Subsidiary;

(vi) except as specifically provided in Article VI, all assets of or relating to a Seller Benefit Plan;

(vii) all financial and tax records relating to the Business that form part of Seller’s or any Seller Subsidiary’s general ledger (except that copies of relevant portions of such records shall be provided to Purchaser to the extent that such records relate to the Business);

(viii) any refund or credit of Taxes attributable to any Retained Tax Liability (as defined in Section 1.04(b)(v));

(ix) except as provided in Section 6.01(a)(i), all personnel files or records and all originals and copies of tax returns;

(x) all records of Seller or any Seller Subsidiary prepared in connection with the sale of the Business, including bids received from third parties and analyses relating to the Business;

(xi) all rights of Seller or any Seller Subsidiary under this Agreement and any other agreements, certificates and instruments relating to the sale of the Business (or any portion thereof) or otherwise delivered in connection with this Agreement;

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(xii) the names and marks set forth on Section 1.02(b)(xii) of the Seller Disclosure Letter and any name or mark derived from, similar to or including any of the foregoing (in each case, in any style or design) (collectively, the “ Retained Names ”);

(xiii) all Equipment located in Allentown, Pennsylvania, Easton, Pennsylvania, or Dallas, Texas not listed on Section 1.02(b) of the Seller Disclosure Letter that are not primarily used in the operation of the Business or any other assets not used in the Business;

(xiv) all Intellectual Property that cannot be freely and clearly transferred to Purchaser as set forth on Section 1.02(b)(xiv) of the Seller Disclosure Letter;

(xv) all Permits and Environmental Permits of Seller or any Seller Subsidiary that are not used or held for use by Seller or any Seller Subsidiary primarily in the operation or conduct of the Business (other than those set forth on Section 1.02(a)(xv) of the Seller Disclosure Letter) or that are used or held for use by Seller or any Seller Subsidiary primarily in the operation or conduct of the Business but are not transferable (as set forth on Section 1.02(b)(xv) of the Seller Disclosure Letter);

(xvi) all Contracts to which Seller or any Seller Subsidiary is a party or by which Seller or any Seller Subsidiary is bound to the extent not used or held for use in, or do not arise out of, the operation or conduct of the Business, in the case of Contracts with customers of the Business;

(xvii) all rights and Claims of Seller or of any Seller Subsidiary, to the extent relating to any Transferred Asset or any Assumed Liability, consisting solely of (x) such rights, Claims and causes of action arising under insurance policies and (y) all rights to assert Claims that Seller or any Seller Subsidiary, in any capacity, ever had, now has or may or shall have in the future, whether known or unknown, relating in any way to (1) the Business’s purchase or procurement of any good, service or product or (2) the purchase or procurement by Seller or any Seller Subsidiary of any good, service or product for, or on behalf of, the Business, in each case, at any time up until the Closing, along with any and all recoveries by settlement, judgment or otherwise in connection with any such Claims;

(xviii) all accounts receivable of Seller or any Seller Subsidiary that are not Transferred Receivables or pursuant to which a payment is owed to Seller or a Seller Subsidiary by an affiliate of Seller;

(xix) any other property or assets of Seller or its affiliates not constituting Transferred Assets;

(xx) all corporate-level services of the type currently provided to the Business by Seller or any of its affiliates (including assets used or held for use by Seller or any of its affiliates in connection with such corporate-level services);

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(xxi) the Business  Employees’ salaries, pension, severance pay treatment, retirement benefits, additional monthly salaries, holidays not taken and any and all obligations toward or relative to the Business Employees or arising out of or in relation to the Employee Contracts, whether or not payable and collectable, which have arisen prior to the Closing Date; and

(xxii) all other assets of any kind that are not used or held for use in the operation or conduct of the Business.

SECTION 1.03.   Consents to Certain Assignments; Shared Contracts

(a) Notwithstanding anything in this Agreement to the contrary, this Agreement shall not constitute an agreement to assign, directly or indirectly, any asset or any claim or right or any benefit arising under or resulting from such asset if an attempted direct or indirect assignment thereof, without the consent of a third party, would constitute a breach, default, violation or other contravention of the rights of such third party, would be ineffective with respect to any party to an agreement concerning such asset, claim or right.  If any direct or indirect transfer or assignment by Seller or any Seller Subsidiary to Purchaser, or any direct or indirect acquisition or assumption by Purchaser of, any interest in, or liability, obligation or commitment under, any asset, claim or right requires the consent of a third party, then such transfer or assignment or assumption shall be made subject to such consent being obtained.

(b) Seller and Purchaser shall use their reasonable best efforts to obtain such consents or approvals prior to the Closing; provided that Purchaser agrees that Seller shall not have any liability whatsoever to Purchaser arising out of or relating to the failure to obtain any consents or waivers that may be required in connection with the transactions contemplated by this Agreement or because of the termination of any Contract or Permit as a result thereof.  Purchaser further agrees that no representation, warranty or covenant of Seller contained herein shall be breached or deemed breached, no Business Material Adverse Effect shall have been deemed to have occurred and no condition (except for the consents required by Section 7.02(d)) shall be deemed not satisfied, as a result of (i) the failure to obtain any such consent or waiver, (ii) any such termination or (iii) any action, claim or proceeding commenced or threatened by or on behalf of any person arising out of or relating to the failure to obtain any such consent or any such termination.  In the event any such consent or approval is not obtained prior to the Closing, Seller shall continue at Purchaser’s request to use all reasonable best efforts to cooperate with Purchaser in attempting to obtain any such consent or approval after the Closing.

(c) In the event that it becomes reasonably apparent to Seller and Purchaser that any such consent or approval with respect to any Shared Contract will not be obtained despite the use of reasonable best efforts with respect thereto, Seller and Purchaser shall use their reasonable best efforts for 180 days thereafter to establish reasonable arrangements with respect to such Shared Contract which result in Purchaser receiving all the existing benefits and bearing all the existing costs, liabilities and burdens with respect to any portion of such Shared Contract which relates to the Business,

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including but not limited to the subcontracting thereof to Purchaser and enforcement at the cost and for the account of Purchaser of any and all rights of Seller against the other party thereto arising out of the breach or cancellation thereof by such other party or otherwise.  If and to the extent such arrangements cannot be made, Purchaser shall have no obligation with respect to such Shared Contract and Seller shall not have any liability whatsoever to Purchaser arising out of or relating to the failure to make such arrangements.  Purchaser further agrees that no representation, warranty or covenant of Seller contained herein shall be breached or deemed breached, no Business Material Adverse Effect shall have been deemed to have occurred and no condition (except for the consents required by Section 7.02(d)) shall be deemed not satisfied, as a result of (i) the failure to make any such arrangements or (ii) any action, claim or proceeding commenced or threatened by or on behalf of any person arising out of or relating to the failure to make such arrangements.  In connection therewith, each party agrees that it will take all actions reasonably necessary so that the other party hereto and its affiliates, as applicable, will remain at all times fully in compliance with their obligations under the Shared Contracts as and to the extent such obligations under the Shared Contracts relate to the operation of the Business after the date of the Closing, and that it will cooperate with such other party and its affiliates, as applicable, in connection therewith.

(d) For purposes of this Section 1.03, “reasonable best efforts” shall not include any requirement of Seller or Purchaser to expend money (other than nominal amounts), commence or participate in any litigation or offer or grant any material accommodation (financial or otherwise) to any third party.

SECTION 1.04.   Assumption of Liabilities.

(a) Upon the terms and subject to the conditions of this Agreement, Purchaser shall irrevocably assume, effective as of the Closing, and from and after the Closing, Purchaser shall pay, perform and discharge when due the following obligations, liabilities and commitments of Seller or of any Seller Subsidiary of any nature (collectively, the “ Assumed Liabilities ”), whether known or unknown, express or implied, primary or secondary, direct or indirect, liquidated, absolute, accrued, contingent or otherwise whether due or to become due:

(i) all obligations, liabilities and commitments arising out of, relating to or otherwise in any way in respect of any of the Transferred Assets, Transferred Permits or the operation or conduct of the Business by Purchaser or its affiliates on or after the Closing Date;

(ii) all obligations, liabilities and commitments arising out of, relating to or otherwise in any way in respect of any suit, action or proceeding (a “ Proceeding ”) and any Claims, in each case arising out of the operation or conduct of the Business by Purchaser or its affiliates on or after the Closing Date;

(iii) all obligations, liabilities and commitments assumed by Purchaser pursuant to Article VI;

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(iv) (A) all obligations, liabilities and commitments arising out of, relating to or otherwise in any way in respect of any and all products manufactured or sold by Purchaser or its affiliates on or after the Closing Date, including obligations, liabilities and commitments for refunds, adjustments, allowances, repairs, exchanges, returns and warranty, product liability, merchantability and other Claims relating to such products, and (B) all service obligations and warranty obligations of Seller or any Seller Subsidiary to repair or replace defective goods or services sold by the Business under the terms of any written contract, commitment or sale transaction entered into in the ordinary course of business and relating to products shipped or services performed not more than six (6) months prior to the Closing Date; provided that Purchaser assumes no obligation of Seller or any Seller Subsidiary for incidental or consequential damages or for any personal injury, or for infringement of Intellectual Property, the sole obligation of Purchaser hereunder being the obligation to repair or replace defective goods or services;

(v) all obligations, liabilities and commitments arising out of, relating to or otherwise in any way in respect of being the owner, lessee or occupant of, or the operator of the activities conducted at, the Transferred Real Property on or after the Closing Date except for such obligations, liabilities and commitments constituting Retained Liabilities;

(vi) all liabilities, obligations and commitments for (A) Taxes arising out of or relating to or in respect of the Business or the Transferred Assets for any Post-Closing Tax Period (as defined in Section 10.06(b)), including the Post-Closing Tax Period of a Straddle Period (as defined in Section 10.06(b)), and (B) Transfer Taxes (collectively, the “ Assumed Tax Liabilities ”);

(vii) all obligations, liabilities and commitments under Environmental Laws and Environmental Permits arising out of the conduct of the Business after the Closing Date or conditions related to the Transferred Assets where such conditions first come into existence after Closing or to the extent any pre-Closing conditions are exacerbated after Closing; and

(viii) all obligations, liabilities and commitments with respect to the Business Employees (as defined in Section 3.12(a)) that (A) Purchaser has specifically agreed to assume pursuant to Article VI or (B) that transfer automatically to Purchaser or its affiliates under Applicable Law (collectively, the “ Covered Employee Liabilities ”).

(b) Notwithstanding any other provision of this Agreement to the contrary, Purchaser shall not assume any Retained Liabilities, each of which shall be retained and shall be paid, performed and discharged when due by Seller or a Seller Subsidiary, as applicable.  The term “ Retained Liabilities ” means:

(i) all obligations, liabilities and commitments of Seller or any Seller Subsidiary to the extent not constituting an Assumed Liability or to the extent arising out of, relating to or otherwise in any way in respect of any Excluded Assets, including but not limited to Accounts Payable;

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(ii) all obligations, liabilities and commitments arising out of, relating to or otherwise in any way in respect of any and all products manufactured or sold by Seller or any Seller Subsidiary prior to the Closing Date other than to the extent assumed under Section 1.04(iv);

(iii) all liabilities under Transferred Contracts that arise after the Closing Date but that arise out of or relate to any breach that occurred prior to the Closing Date;

(iv) all obligations, liabilities and commitments with respect to employees and former employees (and their respective beneficiaries and dependents) of Seller or any Seller Subsidiary or any other affiliate of Seller other than the Covered Employee Liabilities; and

(v) all liabilities, obligations and commitments of Seller or any Seller Subsidiary for Taxes arising out of or relating to or in respect of any business, asset, property or operation of Seller (including the Business and the Transferred Assets) for any Pre-Closing Tax Period (as defined in Section 10.06(b)), including the Pre-Closing Tax Period of a Straddle Period (as defined in Section 10.06(b)) (collectively, the “ Retained Tax Liabilities ”).

SECTION 1.05 .   Risk of Loss .  Until the Closing, any loss of or damage to the Transferred Assets from fire, casualty or any other occurrence shall be the sole responsibility of Seller and the Seller Subsidiaries.  As of the time of Closing, title to all Transferred Assets shall be transferred to Purchaser and Purchaser shall thereafter bear all risk of loss associated with the Transferred Assets and be solely responsible for procuring adequate insurance to protect the Transferred Assets against any such loss.

SECTION 1.06 .   Closing .  The closing of the Acquisition  (the “ Closing ”) shall take place at the offices of Air Products, 7201 Hamilton Boulevard, Allentown, PA 18195, at 10:00 a.m. on the second business day following the satisfaction (or, to the extent permitted, the waiver) of the conditions set forth in Section 7.01, or, if on such day any condition set forth in Section 7.02 or 7.03 has not been satisfied (or, to the extent permitted, waived by the party entitled to the benefit thereof), as soon as practicable after all the conditions set forth in Article VII have been satisfied (or, to the extent permitted, waived by the parties entitled to the benefits thereof), or at such other place, time and date as shall be agreed between Seller and Purchaser.  The date on which the Closing occurs is referred to in this Agreement as the “ Closing Date ”.

SECTION 1.07 .   Transactions to be Effective at the Closing .

(a) At the Closing, Seller and each Seller Subsidiary shall deliver to Purchaser (i) duly executed counterparts of the deeds, bills of sale, assignments and other instruments of transfer necessary to assign the Transferred Assets to the Purchaser; it being agreed that any of such deeds, bills of sale, assignments, instruments of transfer, agreements and other documents shall not require Seller or any Seller Subsidiary to make any additional representations, warranties or covenants, expressed or implied, not

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contained in this Agreement or the Ancillary Agreements (as defined in Section 10.06(b)), (ii) duly executed counterparts of the Assignment and Assumption Agreement and Bill of Sale (each defined in Section 10.06(b)) , (iii) a duly executed counterpart of the Transitional Services Agreement (defined in Section 10.06(b)), (iv) a duly executed counterpart of the Technology License Agreement (as defined in Section 10.06(b)), (v) a duly executed counterpart of each Supply Agreement (as defined in Section 10.06(b)), (vi) a duly executed counterpart of each Site License, (vii) in the case of each applicable Seller Subsidiary, a duly executed Subsidiary Business Transfer Agreement (as defined in Section 10.06(b), (viii) a duly executed special warranty deed, in a form mutually acceptable to Seller and Purchaser, with respect to the acquisition of the real property in Pueblo, Colorado related to the Business; (ix) original certificates of title to the owned motor vehicles and other assets set forth on Section 3.05(c) of the Seller Disclosure Letter in proper form for being conveyed to Purchaser, and (x) such other agreements, documents, instruments and writings as are required to be delivered by Seller and applicable Seller Subsidiaries at or prior to the Closing pursuant to this Agreement or any Ancillary Agreement or otherwise required in connection herewith or therewith).

(b) At the Closing, Purchaser shall deliver to Seller and the Seller Subsidiaries (i) payment, by wire transfer of immediately available funds to one or more accounts designated in writing by Seller (such designation to be made at least two business days prior to the Closing Date), in an amount equal to (A) the Purchase Price plus or minus (B) an estimate, prepared by Seller and delivered to Purchaser at least two business days prior to the Closing Date, of any adjustment to the Purchase Price under Section 2.01, minus (C) the Early Closing Adjustment Amount (as defined in Section 10.06(b)), as set forth in the Early Closing Adjustment Statement (as defined in Section 10.06(b)) delivered by Seller to Purchaser at least two business days prior to the Closing Date (the Purchase Price plus or minus such estimate of any adjustment under Section 2.01 minus the Early Closing Adjustment Amount being hereinafter called the “ Closing Date Payment ”), (ii) duly executed counterparts of the deeds, bills of sale, assignments and other instruments of transfer necessary to assign the Transferred Assets to the Purchaser, and duly executed assumption agreements and other instruments of assumption providing for the assumption of the Assumed Liabilities, (iii) a duly executed counterpart of the Transitional Services Agreement , (iv) a duly executed counterpart of the Technology License Agreement, (v)  a duly executed counterpart to each Supply Agreement, (vi) a duly executed counterpart of each Site License and (vii) all such other certificates and documents required to be delivered to Seller or any Seller Subsidiary at or prior to the Closing pursuant to this Agreement or any Ancillary Agreement.

ARTICLE II

Purchase Price Adjustment

SECTION 2.01 .   Post-Closing Purchase Price Adjustment.

(a)   The Statement .  Within 60 days after the Closing Date, Purchaser shall prepare and deliver to Seller an unaudited statement (the “ Statement ”), setting forth the Working Capital (as defined in Section 2.01(d)) as of the close of business on the Closing

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Date (“ Closing Working Capital ”) and a certificate of Purchaser that the Statement has been prepared in compliance with the requirements of Section 2.01(d).  The Statement shall be based upon the results of a physical inventory of the Inventory of the Business conducted within two business days of the Closing Date.  Seller shall have the right to have a representative(s) present at all times during such physical inventory and Purchaser shall give Seller reasonable advanced notice of the time(s) and place(s) at which such physical inventory shall take place.  Seller and the Seller Subsidiaries shall assist Purchaser in the preparation of the Statement and the parties shall provide one another with access at all reasonable times to their respective personnel, properties, books and records of the Business reasonably required in connection therewith.  Seller’s independent auditors may participate in the preparation of the Statement; provided , however , that Seller and the Seller Subsidiaries acknowledge that Purchaser shall have the primary responsibility and authority for preparing the Statement.

(b) Objections; Resolution of Disputes .  During the 30-day period following Seller’s receipt of the Statement, Seller and its independent auditor shall be permitted to review the working papers relating to the Statement.  The Statement shall become final and binding upon the parties on the 30th day following delivery thereof, unless Seller gives written notice of its disagreement with the Statement (a “ Notice of Disagreement ”) to Purchaser on or prior to such date.  Any Notice of Disagreement shall (i) specify in reasonable detail the nature of any disagreement so asserted and (ii) only include disagreements based on mathematical errors or based on Closing Working Capital not being calculated in accordance with this Section 2.01.  If a Notice of Disagreement is received by Purchaser in a timely manner, then the Statement (as revised in accordance with this sentence) shall become final and binding upon Seller and Purchaser on the earlier of (A) the date Seller and Purchaser resolve in writing any differences they have with respect to the matters specified in the Notice of Disagreement and (B) the date any disputed matters are finally resolved in writing by the Accounting Firm (as defined below).  During the 30-day period following the delivery of a Notice of Disagreement, Seller and Purchaser shall seek in good faith to resolve in writing any differences that they may have with respect to the matters specified in the Notice of Disagreement.  At the end of such 30-day period, Seller and Purchaser shall submit to an independent accounting firm (the “ Accounting Firm ”) for arbitration any and all matters that remain in dispute and were properly included in the Notice of Disagreement.  The Accounting Firm shall be PriceWaterhouseCoopers LLP or, if such firm is unable or unwilling to act, such other nationally recognized independent public accounting firm as shall be agreed upon by the parties hereto in writing.  Seller and Purchaser shall use reasonable efforts to cause the Accounting Firm to render a decision resolving the matters submitted to the Accounting Firm within 30 days of receipt of the submission.  The determination of the Accounting Firm shall be final and binding on the parties, and judgment may be entered upon the determination of the Accounting Firm in any court having jurisdiction over the party against which such determination is to be enforced.   The cost of any arbitration (including the fees and expenses of the Accounting Firm and reasonable attorney fees and expenses of the parties) pursuant to this Section 2.01(b) shall be borne by Purchaser and Seller in inverse proportion as they may prevail on matters resolved by the Accounting Firm, which proportionate allocations shall also be determined by the Accounting Firm at the time the determination of the Accounting Firm is rendered on the merits of the

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matters submitted.  The fees and disbursements of Seller’s and each Seller Subsidiary’s independent auditors incurred in connection with any review of the Statement and review of any Notice of Disagreement shall be borne by Seller, and the fees and disbursements of Purchaser’s independent auditors incurred in connection with any review of the Statement shall be borne by Purchaser.

(c) Adjustment Payment .  The Purchase Price shall be increased by the amount by which Closing Working Capital exceeds $27.5 million (the “ Target Working Capital Amount ”), and the Purchase Price shall be decreased by the amount by which Closing Working Capital is less than the Target Working Capital Amount (the Purchase Price as so increased or decreased shall hereinafter be referred to as the “ Adjusted Purchase Price ”).  If the Closing Date Payment is less than the Adjusted Purchase Price, Purchaser shall, and if the Closing Date Payment is more than the Adjusted Purchase Price, Seller shall, within 10 business days after the Statement becomes final and binding on the parties, make payment by wire transfer in immediately available funds to one or more accounts designated in writing by the party to receive such payment of the amount of such difference, together with interest thereon at a rate equal to the three-month U.S. dollar London interbank offered rate (“ LIBOR ”) plus 2.0%, from the Closing Date to the date of payment (the “ Prime Rate ”).

(d) Working Capital .  The term “Working Capital” shall be determined in accordance with Exhibit A (the “ Accounting Principles ”).  Working Capital shall include the Transferred Inventory, Transferred Receivables and the accrued liabilities set forth in Section 3.04(a) of the Seller Disclosure Letter.  Closing Working Capital is to be calculated in accordance with the same Accounting Principles.  The scope of the disputes to be resolved by the Accounting Firm shall be limited to whether such calculation was done in accordance with the Accounting Principles, and whether there were mathematical errors in the Statement, and the Accounting Firm is not authorized or permitted to make any other determination, including any determination as to whether the Target Working Capital Amount is correct.  Without limiting the generality of the foregoing, the Accounting Firm is not authorized or permitted to make any determination as to the accuracy of Section 3.04 or any other representation or warranty in this Agreement or as to compliance by Seller with any of its covenants in this Agreement (other than in this Section 2.01).  Any determinations by the Accounting Firm, and any work or analyses performed by the Accounting Firm, in connection with its arbitration of any dispute under this Section 2.01 shall not be admissible in evidence in any suit, action or proceeding between the parties other than to the extent necessary to enforce payment obligations under Section 2.01(c).

SECTION 2.02.    Post-Closing Books and Records .  Except for the consummation of the Closing, Purchaser agrees that, during physical inventory pursuant to Section 2.01(a), it shall use its reasonable best efforts to conduct the Business in the ordinary course in a manner substantially consistent with past practice.  Seller and the Seller Subsidiaries shall cooperate in the preparation of the Statement, including providing any customary certifications as may be required by Purchaser’s auditors.  During the period of time from and after the Closing Date through the resolution of any adjustment to the Purchase Price contemplated by Section 2.01, Purchaser shall afford to Seller and the Seller Subsidiaries and any accountants, counsel or

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financial advisers retained by Seller in connection with any adjustment to the Purchase Price contemplated by Section 2.01 reasonable access during normal business hours to all the properties, books, contracts, personnel and records of the Business relevant to the adjustment contemplated by Section 2.01.

ARTICLE III

Representations and Warranties of Seller

Except (i) to the extent arising out of, relating to or otherwise in any way in respect of any Excluded Assets or Retained Liabilities or (ii) as set forth in the disclosure schedule delivered by Seller to Purchaser prior to the date of this Agreement, including the documents attached to or incorporated by reference in such disclosure schedule (collectively, the “ Seller Disclosure Letter ”), Seller hereby represents and warrants to Purchaser as follows:

SECTION 3.01.    Organization and Standing .  Each of Seller and the Seller Subsidiaries is duly organized, validly existing and, to the extent applicable, in good standing under the laws of the jurisdiction of its organization, which jurisdiction is set forth in Section 3.01 of the Seller Disclosure Letter.  Each of Seller and the Seller Subsidiaries has full power and authority and possesses all governmental franchises, licenses, permits, authorizations and approvals necessary to enable it to own, lease or otherwise hold its properties and assets and to carry on its business as presently conducted, other than any such franchises, licenses, permits, authorizations and approvals the lack of which, individually or in the aggregate, have not had and would not reasonably be expected to have a Business Material Adverse Effect.  Each of Seller and the Seller Subsidiaries is duly qualified and in good standing to do business as a foreign entity in each jurisdiction in which the conduct or nature of its business or the ownership, leasing or holding of its properties makes such qualification necessary, except such jurisdictions where the failure to be so qualified or in good standing, individually or in the aggregate, has not had and would not reasonably be expected to have a Material Adverse Effect.  This Section 3.01 does not relate to Environmental Permits, such items being subject to Section 3.14(c).

SECTION 3.02.    Authority; Execution and Delivery; Enforceability .  Seller has full corporate power and authority to execute this Agreement and the Ancillary Agreements to which it is, or is specified to be, a party and to consummate the transactions contemplated to be consummated by it by this Agreement and such Ancillary Agreements.  Prior to the Closing, each Seller Subsidiary shall have full corporate power and authority to execute the Ancillary Agreements to which it is, or is specified to be, a party and to consummate the transactions contemplated to be consummated by it by this Agreement and such Ancillary Agreements.  Seller has taken all corporate action required by its Articles of Incorporation and By-laws or similar organizational documents to authorize the execution and delivery of this Agreement and the Ancillary Agreements to which it is, or is specified to be, a party and to authorize the consummation of the transactions contemplated to be consummated by it by this Agreement and such Ancillary Agreements.  Prior to the Closing, each Seller Subsidiary shall have taken all corporate action required by its comparable organizational documents to authorize the execution and delivery of the Ancillary Agreements to which it is, or is specified to be, a party and to authorize the consummation of the transactions contemplated to be consummated by it by this Agreement and such Ancillary Agreement.  Seller has duly executed and delivered this

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Agreement and prior to the Closing will have duly executed and delivered each Ancillary Agreement to which it is, or is specified to be, a party, and this Agreement constitutes, and each Ancillary Agreement to which it is, or is specified to be, a party will after the Closing constitute, its legal, valid and binding obligation, enforceable against it in accordance with its terms subject, as to enforcement, to applicable bankruptcy, insolvency, moratorium, reorganization or similar laws affecting creditors’ rights generally and to general equitable principles.  Each of the Seller Subsidiaries prior to the Closing will have duly executed and delivered each Ancillary Agreement to which it is, or is specified to be, a party, and this Agreement constitutes, and each Ancillary Agreement to which it is, or is specified to be, a party will after the Closing constitute, its legal, valid and binding obligation, enforceable against it in accordance with its terms subject, as to enforcement, to applicable bankruptcy, insolvency, moratorium, reorganization or similar laws affecting creditors’ rights generally and to general equitable principles.

SECTION 3.03.    No Violation; Consents .  The execution and delivery by Seller of this Agreement does not, the execution and delivery by Seller and each of the Seller Subsidiaries of each Ancillary Agreement to which it is, or is specified to be, a party will not, and the consummation by Seller of the Acquisition and the other transactions contemplated to be consummated by it by this Agreement and such Ancillary Agreement and by each of the Seller Subsidiaries of the Acquisition and the other transactions to be consummated by it by such Ancillary Agreements, will not conflict with, or result in any breach of or constitute a default or give rise to any right of termination or acceleration under, any provision of (i)  in the case of Seller, its Articles of Incorporation or By-laws, and, in the case of each of the Seller Subsidiaries, its comparable organizational documents, (ii) any Business Contract (as defined in Section 3.08(b)) or (iii) any judgment or Applicable Law applicable to Seller, any Seller Subsidiary or any of the Transferred Assets, and will not result in the creation of any Lien (as defined in Section 3.05(a)) (other than Permitted Liens (as defined in Section 3.05(a)) or Liens arising from acts of Purchaser or its affiliates) upon any of the Transferred Assets.  No material consent, approval or authorization (“ Consent ”) of, or registration, declaration or filing with, any Federal, state, local or foreign court of competent jurisdiction, governmental agency, authority, instrumentality or regulatory body (a “ Governmental Entity ”) is required to be obtained or made by or with respect to Seller or any Seller Subsidiary in connection with the execution, delivery and performance of this Agreement or the consummation of the Acquisition, other than (A) compliance with and filings under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the “ HSR Act ”) and other applicable Antitrust Laws, (B) compliance with and such filings and notifications as may be required under applicable state property transfer laws or other Environmental Laws (as defined in Section 10.06(b)), (C) those that may be required solely by reason of Purchaser’s (as opposed to any other third party’s) participation in the Acquisition and the other transactions contemplated by this Agreement and by the Ancillary Agreements, and (D) compliance with the Seller’s reporting obligations under the Securities Exchange Act of 1934.

SECTION 3.04.    Financial Statements; Absence of Certain Changes .

(a) Section 3.04(a) of the Seller Disclosure Letter sets forth an unaudited statement of assets and liabilities with respect to the Business at September 30, 2007 (together with the notes thereto, the “ Statement of Assets and Liabilities ”) and the related unaudited statement of revenues and direct costs with respect to the Business for the 36

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months then ended (together with the notes thereto, and collectively with the Statement of Assets and Liabilities, the “ Business Financial Statements ”), which fairly present, in all material respects, Seller’s historical cost, in conformity with generally accepted accounting principles in the United States as in effect from time to time (“ GAAP ”) (except that the Statement of Assets and Liabilities lacks footnote disclosure and other presentation items required by GAAP) basis of the assets and liabilities of the Business as of September 30, 2007, and the revenues and direct costs of the Business, based upon or derived from the Transferred Assets and Assumed Liabilities, for the 36 months then ended.

(b) Neither Seller, nor any of the Seller Subsidiaries, have any material liabilities or obligations of any nature, whether known or unknown, accrued, contingent, absolute, determined, determinable or otherwise, related to the Business and required to be reflected in the Business Financial Statements, which were prepared in conformity with GAAP (except that the Statement of Assets and Liabilities lacks footnote disclosure and other presentation items required by GAAP)(“ Liabilities ”), except (i) as disclosed, reflected or reserved against in the Statement of Assets and Liabilities, (ii) the Retained Liabilities and (iii) Liabilities incurred in the ordinary course of business consistent with past practice since the date of the Statement of Assets and Liabilities and not in violation of this Agreement (none of which has had or would reasonably be expected to have a Business Material Adverse Effect).

SECTION 3.05.   Assets Other than Real Property Interests .

(a) Seller or a Seller Subsidiary has, or as of the close of business on the Closing Date will have, good and valid title to all Transferred Assets, other than those sold or otherwise disposed of since the date of the Statement of Assets and Liabilities in the ordinary course of business consistent with past practice and not in violation of this Agreement, in each case free and clear of all mortgages, liens, charges, Claims, pledges or other encumbrances of any kind (collectively, “ Liens ”), except for (i) mechanics’, carriers’, workmen’s, repairmen’s or other like Liens arising or incurred in the ordinary course of business consistent with past practice, (ii) Liens arising under original purchase price conditional sales Contracts and equipment leases with third parties entered into in the ordinary course of business consistent with past practice with respect to the equipment being purchased or leased, (iii) Liens for Taxes and other governmental charges that are not due and payable, that may thereafter be paid without penalty or which are being contested in good faith, and (iv) other non-monetary imperfections of title, licenses or encumbrances, if any, which do not materially impair the continued use and operation of the assets to which they relate in the conduct of the Business as currently conducted (the Liens described in clauses (i) through (iv) above, together with the Liens referred to in clauses (B) through (E) of the second sentence of Section 3.06, are referred to collectively as “ Permitted Liens ”).  All tangible personal property included in the Transferred Assets is in good operating condition and repair, other than normal wear and tear, and is suitable for immediate use in the ordinary course of business.  No item of tangible personal property included in the Transferred Property is in need of repair or replacement other than as part of routine maintenance in the ordinary course of business.

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(b) This Section 3.05 does not relate to real property or interests in real property, such items being the subject of Section 3.06, or to Intellectual Property, such items being the subject of Section 3.07.

SECTION 3.06.    Real Property .  Section 3.06(a) of the Seller Disclosure Letter sets forth a complete list of all real property and interests in real property owned in fee by Seller or a Seller Subsidiary and used or held by Seller or a Seller Subsidiary for use primarily in the operation or conduct of the Business (collectively, the “ Real Property ”) and true and complete copies of all deeds (or comparable instruments, with respect to Seller Subsidiaries), and title insurance policies related to the Real Property. Section 3.06(b) of the Seller Disclosure Letter sets forth a complete list of all real property and interests in real property leased by Seller or a Seller Subsidiary and used or held by Seller or a Seller Subsidiary for use primarily in the operation or conduct of the Business (individually, a “ Leased Property ”).  Seller and each of the Seller Subsidiaries have good and insurable fee title to all Real Property and good and valid title to the leasehold estates in all Leased Property (Real Property or Leased Property being sometimes referred to herein, individually, as “Transferred Real Property”), in each case free and clear of all Liens, except (A) Liens described in clauses (i) through (iv) of Section 3.05(a), (B) leases, subleases and similar agreements set forth in Section 3.06 of the Seller Disclosure Letter, (C) easements, covenants, rights-of-way, restrictions and other similar matters of record, (D) any conditions that may be shown by a current, accurate survey or physical inspection of any Transferred Real Property made prior to Closing, and (E)(i) zoning, building and other similar codes and restrictions, (ii) Liens that have been placed by any developer, landlord or other third party on property over which Seller or any Seller Subsidiary has easement rights or on any Leased Property and subordination or similar agreements relating thereto, and (iii) unrecorded easements, covenants, rights-of-way, restrictions and other similar matters, none of which items set forth in this clause (E), individually or in the aggregate, materially impairs the continued use and operation of the Transferred Real Property to which they relate in the conduct of the Business as currently conducted.  This Section 3.06 does not relate to environmental matters, such items being the subject of Section 3.14.

SECTION 3.07.    Intellectual Property .

(a) Section 3.07(a) of the Seller Disclosure Letter sets forth a complete and accurate list of (i) the patents and patent applications, (ii) the trademark and servicemark registrations and applications and material unregistered trademarks, (iii) copyright applications and registrations, (iv) registered Internet domain names, (v) outgoing licenses of any of the foregoing and (vi) incoming licenses of Intellectual Property, in each case that are used in or held for use in the Business.  With respect to patent, copyright and trademark registrations and applications, Section 3.07(a) of the Seller Disclosure Letter lists, as of the date of this Agreement, the jurisdictions where such patents, copyrights or trademarks are registered or where such applications have been filed and all registration and application numbers and any fees that will be due within 180 days following the Closing that will not be paid by Seller.  Seller or a Seller Subsidiary is the sole and exclusive owner of, or has a valid right to use or a license for, the Transferred Intellectual Property and Transferred Technology and no license fees of any kind in respect of such Transferred Intellectual Property and Transferred Technology are required for the use by Seller or the applicable Seller Subsidiary, or for the Purchaser

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following the Closing (other than fees that may exist for Intellectual Property that is licensed-in by Seller, of such Intellectual Property in those jurisdictions where such Intellectual Property is currently used.  All Transferred Intellectual Property or Transferred Technology owned by Seller or a Seller Subsidiary (“ Owned Intellectual Property ”) is owned by such entity free and clear of all Liens other than Permitted Liens, and is valid and enforceable.

(b) All Owned Intellectual Property consisting of patents, patent applications, trademark and service mark registrations and applications and copyright applications and registrations has been duly registered and/or filed, as applicable, with or issued by each applicable Governmental Entity in each jurisdiction in which a Seller has sought to register such rights (all of which are set forth on the Seller Disclosure Letter), all necessary affidavits of continuing use have been filed and all necessary maintenance fees have been paid to continue all such rights in effect.  Seller and each Seller Subsidiary have complied in all material respects with all applicable notice and marking requirements for such patents and trademarks.

(c) No Claims are pending or, to the knowledge of Seller, threatened, against Seller or any Seller Subsidiary by any person claiming infringement of such person’s Intellectual Property by use of the Transferred Intellectual Property or Transferred Technology in the operation or conduct of the Business as currently conducted.  The operation of the Business, and the use, marketing, licensing and sale of Transferred Inventory from the Business does not violate and has not violated or infringed the rights of any person in any third party Intellectual Property.

(d) The Transferred Assets and the Licensed Assets include all Intellectual Property necessary for the operation of the Business by Purchaser.

(e) To the knowledge of the Seller, there is no and has been no unauthorized use, disclosure, infringement, misappropriation or other violation of any Transferred Intellectual Property or Transferred Technology by any third party, including any employee or former employee of the Seller or any of the Seller Subsidiaries.

(f) Neither the Seller nor any of the Seller Subsidiaries has licensed any Transferred Intellectual Property or Transferred Technology to any Person on an exclusive basis, nor has the Seller or any of the Seller Subsidiaries entered into any Contract materially limiting its ability to exploit fully any Transferred Intellectual Property or Transferred Technology.

(g) The Seller and each of the Seller Subsidiaries is not, nor will any of them be as a result of the execution and delivery of this Agreement or the performance of its obligations under this Agreement, in breach of any license, sublicense or other Contract relating to the Transferred Intellectual Property or Transferred Technology.

(h) To the knowledge of Seller, no non-public, proprietary Intellectual Property owned by the Seller or the Seller Subsidiaries, has been authorized to be disclosed or actually disclosed by the Seller or any of the Seller Subsidiaries to any

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employee or third party other than pursuant to a non-disclosure agreement or other confidentiality obligation that protects the proprietary interests of the Seller and the Seller Subsidiaries in and to such Intellectual Property. To the knowledge of Seller, the Seller and the Seller Subsidiaries have entered into written confidentiality and proprietary rights agreements with all of its past and present employees acknowledging the Seller’s or Seller Subsidiary’s ownership of all Intellectual Property created or developed by its employees within the scope of their employment.  The Seller and the Seller Subsidiaries have taken reasonable security measures to protect the confidentiality of confidential information owned by the Seller and the Seller Subsidiaries. The Seller or the Seller Subsidiaries have also taken reasonable security measures to protect the confidentiality of, and have not disclosed or authorized the disclosure of, any confidential information that is not owned by the Seller or the Seller Subsidiaries, except for instances in which the failure to take such security measures, or the disclosure of or authorization to disclose such information, did not breach any contractual obligation owed by the Seller or any of the Seller Subsidiaries to a third party with respect to such information.

SECTION 3.08.    Contracts .

(a) Except for Contracts (x) set forth in Section 3.08(a) of the Seller Disclosure Letter, (y) this Agreement and the Ancillary Agreements and (z) Contracts entered into after the date of this Agreement in accordance with Section 5.01, neither Seller nor any Seller Subsidiary is a party to or bound by any Contract that is used and held for use primarily in, or that arises primarily out of, the operation or conduct of the Business in each case that is:

(i) written employment Contract;

(ii) employee collective bargaining agreement or other Contract with any labor organization, union or association;

(iii) covenant not to compete (other than pursuant to any radius restriction contained in any lease, reciprocal easement or development, construction, operating or similar agreement) or other covenant restricting the development, manufacture, marketing or distribution of the products and services of Seller or a Seller Subsidiary that materially limits the conduct of the Business as presently conducted;

(iv) lease, sublease or similar Contract with any person under which Seller or any Seller Subsidiary is a lessor or sublessor of, or makes available for use to any person, (A) any Transferred Real Property or (B) any portion of any premises otherwise occupied by Seller or any Seller Subsidiary that, in either case, specifies annual payments in excess of $100,000;

(v) lease, sublease or similar Contract with any person under which Seller or a Seller Subsidiary is lessee of, or holds or uses, any machinery, equipment, vehicle or other tangible personal property owned by any person that has a future liability in excess of $100,000;

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(vi) Contract for the purchase or sale of Inventory, materials, supplies or equipment (other than purchase Contracts and orders for inventory that are reflected on the Statement of Assets and Liabilities) that has an aggregate future liability to any person in excess of $100,000 and is not terminable by Seller or a Seller Subsidiary by notice of not more than 90 days for no cost;

(vii) management, service, consulting or other similar Contract that has an aggregate future liability to any person in excess of $100,000;

(viii) Contract under which Seller or a Seller Subsidiary has borrowed any money from, or issued any note, bond, debenture or other evidence of indebtedness (other than accounts payable) to, any person or any other note, bond, debenture or other evidence of indebtedness (other than accounts payable) of Seller or a Seller Subsidiary, in any such case which, individually, is in excess of $100,000;

(ix) Contract (including any so-called take-or-pay or keepwell agreements) under which (A) any person has directly or indirectly guaranteed indebtedness, liabilities or obligations of Seller or a Seller Subsidiary or (B) Seller or any Seller Subsidiary has directly or indirectly guaranteed indebtedness, liabilities or obligations of any person (in each case other than endorsements for the purpose of collection in the ordinary course of business), in any such case which, individually, is in excess of $100,000;

(x) Contract granting a Lien upon any Transferred Real Property for which the Lien is not a Permitted Lien;

(xi)  Contract providing for indemnification of any person, including Seller or a Seller Subsidiary, with respect to material liabilities relating to the Business, other than the constitutive documents of Seller or any Seller Subsidiary and marketing agreements, property leases and other commercial agreements entered into in the ordinary course of business; or

(xii) other Contract that has an aggregate future liability to any person in excess of $250,000.

(b) All Transferred Contracts listed in Section 3.08(a) of the Seller Disclosure Letter (such Contracts, the “ Business Contracts ”) are valid, binding and in full force and effect in all material respects and are enforceable in all material respects by Seller, in accordance with their terms, subject, as to enforcement, to applicable bankruptcy, insolvency, moratorium, reorganization or similar laws affecting creditors’ rights generally and to general equitable principles.  Seller and the Seller Subsidiaries have performed all obligations required to be performed by them to date under the Business Contracts in all material respects, and they are not in breach or default thereunder in any material respect and, to the knowledge of Seller, as of the date of this Agreement, no other party to any Business Contract is in breach or default of its obligations thereunder in any material respect.

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SECTION 3.09.    Permits .

(a) Section 3.09 of the Seller Disclosure Letter lists all material Permits used or held for use primarily in the operation or conduct of the Business. All Transferred Permits are validly held by Seller or a Seller Subsidiary, and Seller or a Seller Subsidiary has complied in all material respects with the terms and conditions thereof. Since January 1, 2004, neither Seller nor a Seller Subsidiary has received written notice of any Proceeding relating to, and, to the knowledge of Seller, there are no facts, circumstances or conditions that would reasonably be expected to result in, the revocation or material modification of any such Transferred Permits. None of such Transferred Permits would reasonably be expected to be subject to suspension, material modification, revocation or nonrenewal as a result of the execution and delivery of this Agreement or the consummation of the Acquisition.  This Section 3.09 does not relate to Environmental Permits, such items being the subject of Section 3.14(c).

SECTION 3.10.    Taxes .

(a) Seller and each of the Seller Subsidiaries have timely paid all Taxes imposed on, or in connection with, the Transferred Assets (and filed on a timely basis all Tax Returns required to be filed relating to the Transferred Assets, which Tax Returns were true, complete and correct in all material respects) that are due and payable on or prior to the Closing Date (except for Taxes being contested in good faith and Transfer Taxes).

(b) No material Tax liens have been filed and no material Claims are being asserted in writing with respect to any Taxes due with respect to the Transferred Assets.

SECTION 3.11.    Proceedings .  Except as set forth on Section 3.11 of Seller Disclosure Letter, there are no pending or, to the knowledge of Seller, threatened Proceedings against Seller or any Seller Subsidiary, which arise out of the conduct of the Business.  Section 3.11 of the Seller Disclosure Letter lists, as of the date of this Agreement, each pending Proceeding initiated by Seller or any Seller Subsidiary which arises out of the conduct to the Business.  No Seller nor any of the Seller Subsidiaries, is party or subject to or in default under any material unsatisfied judgment that is applicable to the conduct of the Business.

SECTION 3.12.    Employee Compensation; Benefit Plans .

(a) Section 3.12 of the Seller Disclosure Letter sets forth a true and correct list, as of the date of this Agreement, of all individuals employed by Seller and any Seller Subsidiary primarily in the conduct of the Business and their present position and rate of compensation (the “ Business Employees ”).

(b) Neither Seller, nor any Seller Subsidiary, has taken any action that might result in Purchaser being a party to, or bound by, any Seller Employee Benefit Plan, and Purchaser shall have no liability or obligation under, or be subject to any liability or obligation on account of, any Seller Employee Benefit Plan following the Acquisition including, without limitation, any liability or other obligation with respect to any multiemployer plan or COBRA.

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(c) Section 3.12 of the Seller Disclosure Letter contains a true and complete list of all Seller Employee Benefit Plans.

(d) Seller and the Seller Subsidiaries have provided to Purchaser true and correct summaries of all Seller Employee Benefit Plans (including amendments).

SECTION 3.13.    Absence of Changes or Events.   Since the date of the Statement of Assets and Liabilities, (a) there has not been a Business Material Adverse Effect and (b) Seller and the Seller Subsidiaries have caused the Business to be conducted in the ordinary course and substantially in the same manner as previously conducted.

SECTION 3.14.    Compliance with Applicable Laws.

(a) The Business, the Transferred Assets and the Transferred Real Property are and have been, during the three years immediately preceding the date of this Agreement, in compliance with all Applicable Laws in all material respects.  Neither Seller, nor any of the Seller Subsidiaries, have received any written notice or other written communication which has not been finally resolved as of the date of this Agreement from any Governmental Entity that alleges that the Business is not in compliance with any Applicable Laws in any material respect.  This Section 3.14(a) does not relate to matters with respect to Taxes, which are subject to Section 3.10, to Permits, which are subject to Section 3.09, to employee matters, which are subject to Section 3.12, or to environmental matters, which are subject to the other subsections of this Section 3.14 .

(b) the Transferred Assets (including the Transferred Real Property) and the operation of the Business are, and have been, during the three years immediately preceding the date of this Agreement, in material compliance with all Environmental Laws, and Seller and each Seller Subsidiary possess, and the Transferred Assets (other than the Transferred Real Property) and the operation of the Business are, and have been, during the three years immediately preceding the date of this Agreement, in material compliance with, all Environmental Permits required to operate the Transferred Assets (including the Transferred Real Property) and the Business, other than any noncompliance with such Environmental Laws or Environmental Permits which has been finally resolved as of the date of this Agreement;

(c) Section 3.14(c) of the Seller Disclosure Letter lists, as of the date of this Agreement, all material Environmental Permits used or held for the operation or conduct of the Business or the ownership of the Transferred Assets (including the Transferred Real Property), (x) all Environmental Permits are validly held by Seller or a Seller Subsidiary, and are in full force and effect and neither Seller nor any of the Seller Subsidiaries have received written notice of any Proceeding relating to the Environmental Permits, (y) to the knowledge of Seller, there are no facts, circumstances or conditions that would reasonably be expected to result in the suspension, modification, revocation or non-renewal of any Environmental Permit, and (z) Seller and Seller Subsidiaries have timely applied for the renewal of such Environmental Permits so that such Environmental Permits remain in full force and effect during the pendency of the renewal application.

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To Seller’s knowledge, none of such Environmental Permits would reasonably be expected to be subject to suspension, material modification, revocation or nonrenewal or to not be transferred to Purchaser as a result of the execution and delivery of this Agreement or the consummation of the Acquisition;

(d) There is no pending, or to Seller’s knowledge, threatened, Proceeding to which Seller or any Seller Subsidiary is a party, or claim, demand or notice of violation received by Seller or any Seller Subsidiary, or, to Seller’s knowledge, investigation of Seller or any Subsidiary (including any inspection by any Governmental Entity during the two years immediately preceding the date of this Agreement), alleging any liability, violation of or obligation under or in connection with any Environmental Law  in respect of the Transferred Assets (including the Transferred Real Property) or the operation of the Business, and to the knowledge of Seller, there are no facts, circumstances, or conditions that would reasonably be expected to result in such Proceedings, claims, demands, investigations or notices of violation and Seller and Seller Subsidiaries have made available to Purchaser copies of all pending or threatened Proceedings, claims, demands or notices of violation arising under or in connection with Environmental Law in respect of the Transferred Assets;

(e) there has been no Release or threatened Release of any Hazardous Materials from the operations, acts or omissions of Seller or any Seller Subsidiary in amounts either in amounts in excess of any regulatory standard applicable to such matter, in amounts such that reporting to any Governmental Entity is or was required or in amounts reasonably likely to result in a Business Material Adverse Effect, in, on, at, under, to, about, through or from the soil, subsurface strata, surface water, groundwater or ambient or indoor air or otherwise at any of the Transferred Assets or the Transferred Real Property) and there is not now, nor, since January 1, 2004, has there been in the past, on, in or under any of the Transferred Assets, any underground storage tanks, above-ground storage tanks, dikes or impoundments or any locations of on site disposal of Hazardous Materials or of any other substance that would give rise to any liabilities or investigative, corrective or remedial obligations pursuant to any Environmental Laws; and

(f) neither Seller nor any Seller Subsidiary has received any written notice of any Proceeding, claim, demand, investigation or notice of violation alleging any liability under the Comprehensive Environmental Response, Compensation, and Liability Act (“ CERCLA ”) or any similar state statutes or any request for information or similar inquiry under CERCLA or similar state statutes, relating to the Release or threatened Release of any Hazardous Materials or the off-site disposal or arrangement for disposal of any Hazardous Materials which Proceeding, claim, demand, investigation or notice of violation has not been finally resolved as of the date of this Agreement.

(g) Seller and the Seller Subsidiaries have made available to Purchaser copies of all material audits, studies, reports, analyses and results of investigations related to environmental matters, including Environmental Permits, and Phase I and Phase II environmental site assessments, that are in the Seller’s or any Seller Subsidiary’s

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possession or under its or their control with respect to the Business or the Transferred Assets.

SECTION 3.15.    Labor Relations.

(a) None of the Business Employees set forth on Section 3.12 of the Seller Disclosure Letter is, or within the last three years has been, a member of a bargaining unit covered by a collective bargaining agreement or other labor union contract to which Seller or any Seller Subsidiary is a party;

(b) There are no pending negotiations between Seller or any Seller Subsidiary and any labor union or representative thereof regarding (i) any proposed material changes to any existing collective bargaining agreement applicable to the Business Employees, (ii) the extension or renewal of such an agreement or (iii) the entering into of any collective bargaining agreement or other labor union contract applicable to the Business Employees;

(c) To the knowledge of Seller, neither Seller nor any Seller Subsidiary is in default or has breached, in any material respect, the terms of any collective bargaining or other labor union contract applicable to the Business Employees;

(d) Neither Seller nor any Seller Subsidiary is now, nor has been within the last three years, subject to any union organizing effort, strike, work stoppage or lock out involving any Business Employees;

(e) To the knowledge of Seller, neither Seller nor any Seller Subsidiary is engaged in any material respect in any unfair labor practice with respect to any Business Employees and there is not any material employee grievance which involves any Business Employees pending before any union, organization or Governmental Entity;

(f) To the knowledge of Seller, neither Seller nor any Seller Subsidiary is the subject of any material complaint, charge, investigation, audit, suit or other legal process pending with any Governmental Entity with respect to any Business Employees, or any of the terms or conditions of their employment, by any Governmental Entity;

(g) The Employment Contracts are in compliance with the national collective bargaining agreements applicable to Seller and any Seller Subsidiary and “Dirigenti Aziende Industriali”, as the case may be, and there are no additional company or plant collective bargaining agreements or relationships with any labor unions; and

(h) The Business Employees are the sole employees of Seller or any Seller Subsidiary entitled to be transferred to Purchaser pursuant to Article 2112 of the Italian Civil Code, and no other employees of Seller or any Seller Subsidiary are or can be considered part of the Business nor are any such employees entitled to be transferred to Purchaser pursuant to Applicable Law.

SECTION 3.16.    Accounts Receivable.   All accounts receivable (the “ Accounts Receivable ”) reflected on the Statement of Assets and Liabilities or the accounting records of the

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Business as of the Closing arose or will arise from sales actually made by Seller or the Seller Subsidiaries in the ordinary course of business.  There is no material contest, claim or right of set-off asserted in writing under any Contract with any obligor of an Account Receivable relating to the amount or validity of such Account Receivable which has not been reserved against on the Statement of Assets and Liabilities or in the accounting records of the Business as of the Closing.  Subject to such reserves, each of such Accounts Receivable either has been or will be collectible  in full, in the ordinary course of business.

SECTION 3.17.    Inventory.   All items included in Inventory consist of a quality and quantity usable and, with respect to finished goods, saleable in the ordinary course of business of Seller and the Seller Subsidiaries, except for obsolete times and items below standard quality, all of which have been taken into account in reserves set forth on the Statement of Assets and Liabilities and the accounting records of Seller and the Seller Subsidiaries as of the Closing.  The Inventory has been valued in accordance with GAAP consistently applied.  Inventory purchased after the date of the Statement of Assets and Liabilities were purchased in the ordinary course of business.  The quantities of each item of Inventory are not excessive, but are reasonable in the present circumstances of Seller and the Seller Subsidiaries.  Work in process Inventory has been valued as set forth on the Statement of Assets and Liabilities.

SECTION 3.18.    Customers.   Section 3.18 of the Seller Disclosure Letter sets forth a true and accurate list of the ten largest customers of the Business in terms of worldwide revenues as measured within the last twelve months ended September 30, 2007.  Seller has not received, within the last twelve months, written notice from any of such customers of a threat to cancel or otherwise terminate its relationship with Seller or any Seller Subsidiary or to decrease or limit such customer’s purchase of the products or services of the Business, which cancellation, termination, decrease or limitation would have a Business Material Adverse Effect.

ARTICLE IV

Representations and Warranties of Purchaser

Purchaser hereby represents and warrants to Seller as follows:

SECTION 4.01.    Organization, Standing and Power.   Purchaser is duly organized, validly existing and in good standing under the laws of the jurisdiction in which it is organized and has full corporate power and authority and possesses all governmental franchises, licenses, permits, authorizations and approvals necessary to enable it to own, lease or otherwise hold its properties and assets and to conduct its business as presently conducted, other than such franchises, licenses, permits, authorizations and approvals the lack of which, individually or in the aggregate, have not had and would not reasonably be expected to have a material adverse effect (i) on the ability of Purchaser to perform its obligations under this Agreement and the Ancillary Agreements or (ii) on the ability of Purchaser to consummate the Acquisition and the other transactions contemplated by this Agreement and the Ancillary Agreements (a “ Purchaser Material Adverse Effect ”).

SECTION 4.02.    Authority; Execution and Delivery; and Enforceability.   Purchaser has full power and authority to execute this Agreement and the Ancillary Agreements to which it

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is, or is specified to be, a party and to consummate the Acquisition and the other transactions contemplated hereby and thereby.  The execution and delivery by Purchaser of this Agreement and the Ancillary Agreements to which it is, or is specified to be, a party and the consummation by Purchaser of the Acquisition and the other transactions contemplated hereby and thereby have been duly authorized by all necessary corporate action.  Purchaser has duly executed and delivered this Agreement and prior to the Closing will have duly executed and delivered each Ancillary Agreement to which it is, or is specified to be, a party, and this Agreement constitutes, and each Ancillary Agreement to which it is, or is specified to be, a party will after the Closing constitute, its legal, valid and binding obligation, enforceable against it in accordance with its terms subject, as to enforcement, to applicable bankruptcy, insolvency, moratorium, reorganization or similar laws affecting creditors’ rights generally and to general equitable principles.

SECTION 4.03.    No Conflicts; Consents.   The execution and delivery by Purchaser of this Agreement do not, the execution and delivery by Purchaser of each Ancillary Agreement to which it is, or is specified to be, a party will not, and the consummation of the Acquisition and the other transactions contemplated hereby and thereby and compliance by Purchaser with the terms hereof and thereof will not conflict with, or result in any violation of or default (with or without notice or lapse of time, or both) under, or give rise to a right of termination, cancellation or acceleration of any obligation or to loss of a material benefit under, or result in the creation of any Lien upon any of the properties or assets of Purchaser or any of its subsidiaries under, any provision of (i) the articles of incorporation or by-laws or comparable organizational documents of Purchaser or any of its subsidiaries, (ii) any Contract to which Purchaser or any of its subsidiaries is a party or by which any of their respective properties or assets is bound or (iii) any judgment or Applicable Law applicable to Purchaser or any of its subsidiaries or their respective properties or assets, other than, in the case of clauses (ii) and (iii) above, any such items that, individually or in the aggregate, have not had and would not reasonably be expected to have a Purchaser Material Adverse Effect.  No Consent of or registration, declaration or filing with any Governmental Entity is required to be obtained or made by or with respect to Purchaser or any of its subsidiaries in connection with the execution, delivery and performance of this Agreement or any Ancillary Agreement or the consummation of the Acquisition or the other transactions contemplated hereby and thereby, other than (A) compliance with and filings under Antitrust Laws, (B)  compliance with and such filings and notifications as may be required under applicable state property transfer laws or Environmental Laws, and (C) compliance with the Purchaser’s reporting obligations under the Securities Exchange Act of 1934.

SECTION 4.04.    Proceedings.   There are not any (a) outstanding judgments against Purchaser or any of its subsidiaries, (b) Proceedings pending or, to the knowledge of Purchaser, threatened against Purchaser or any of its subsidiaries or (c) investigations by any Governmental Entity that are pending or threatened against Purchaser or any of its subsidiaries that, in any such case, individually or in the aggregate, have had or would reasonably be expected to have a Purchaser Material Adverse Effect.

SECTION 4.05.    Availability of Funds .   Purchaser has or at Closing will have cash available or has or will have at Closing existing borrowing facilities which together are sufficient to enable it to consummate the Acquisition and the other transactions contemplated by this Agreement.  The financing required to consummate the Acquisition and the other transactions

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contemplated by this Agreement is referred to in this Section 4.05 collectively as the “Financing”.  Purchaser does not have any reason to believe that any of the conditions to the Financing will not be satisfied or that the Financing will not be available to Purchaser on a timely basis to consummate the Acquisition and the other transactions contemplated by this Agreement.

SECTION 4.06.    Independent Judgment.   Purchaser has been given access to the premises, books, records and offices of Seller and the Seller Subsidiaries, and has had the opportunity to review such other data and other information with respect to the Business and the Transferred Assets as Purchaser has determined is sufficient to evaluate the transaction with Seller contemplated by this Agreement.  In proceeding with the Closing, with respect to Seller, Purchaser will rely solely upon its due diligence and those representations and warranties made by Seller in Article III hereof.  Purchaser acknowledges that neither Seller nor any of its officers, directors, affiliates or agents assume any responsibility for the accuracy and adequacy of any information heretofore or hereafter furnished to Purchaser by or on behalf of Seller with respect to the Business or the Transferred Assets, except as otherwise expressly provided in this Agreement (including the Seller Disclosure Letter).  Without limiting the generality of the foregoing, Purchaser understands that any cost estim