PURCHASE AGREEMENT

Exhibit 10.1

SPECIALTY SURGICAL INSTRUMENTATION, INC.

UCA, LLC

PURCHASE AGREEMENT

By and Among

SYMMETRY MEDICAL USA INC.
(Purchaser)

and

LOUIS C. WALLACE
CHARLES O. MANN, JR.
(Sellers)

DATED:  August 29, 2007

TABLE OF CONTENTS

PURCHASE AGREEMENT

THIS PURCHASE AGREEMENT (this “Agreement”) is made and entered into on the 29 ^th day of August, 2007, by and between Symmetry Medical USA Inc. , a duly organized Delaware Corporation with a principal place of business in Warsaw, Indiana (“Purchaser”) and Louis C. Wallace (“Wallace”) of Nashville, Tennessee and Charles O. Mann, Jr. , (“Mann”) of Maury County, Tennessee (collectively “Sellers”).

RECITALS

A.            Sellers own (i) all of the issued and outstanding shares of capital stock of Specialty Surgical Instrumentation, Inc., a Tennessee corporation with a principal place of business in Nashville, Tennessee, (the “Shares”); and (ii) all of the membership interests in UCA, LLC, a Tennessee member-managed limited liability company, (the “Membership Interests”). Collectively Specialty Surgical Instrumentation, Inc (“SSI”) and UCA, LLC (“UCA”) are referred to herein as the “Companies” and individually as a “Company.”  The Shares and the Membership Interests shall collectively be referred to herein as the “Equity Interests”).

B.            SSI owns 100% of the Specialty Surgical Instrumentation Distribution and SSI Ultra Instrument Business, these being divisions of SSI not separately incorporated.

C.            Purchaser desires to purchase the Equity Interests held by Sellers and Sellers desire to sell the Equity Interests to Purchaser on the terms and subject to the conditions set forth in this Agreement. Purchaser’s wholly-owned subsidiary will purchase the real estate used by SSI and UCA and owned by MFW Investments under a separate Real Property Sale and Purchase Agreement.

D.            Upon consummation of the purchase and sale of the Equity Interests pursuant to this Agreement, Purchaser will own all of the issued and outstanding equity of the Companies.

AGREEMENT

In consideration of the foregoing Recitals and the mutual promises contained in this Agreement, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged and intending to be legally bound, Purchaser and Sellers agree as follows:

ARTICLE 1

DEFINITIONS

For purposes of this Agreement, the following terms have the meanings specified:

“ Affiliate ” when used in reference to a specified Person, means any Person that, directly or indirectly, through one or more intermediaries, controls, or is controlled by, or is under common control with the specified Person.

“ Agreement ” has the meaning set forth in the introductory paragraph of this Agreement.

“ Ancillary Documents ” are all documents, instruments and agreements to be executed and delivered by Purchaser, Sellers or the Companies pursuant to this Agreement including the Schedules and Exhibits and including, but not limited to, the Earn-Out Agreement and the Real Property Sale and Purchase Agreement.

“ Applicable Laws ” means any and all laws, ordinances, constitutions, regulations, statutes, treaties, rules, codes, licenses, certificates, franchises, Permits, legal requirements and Injunctions adopted, enacted, implemented, promulgated, issued or entered by or under the authority of any Governmental Body having jurisdiction over a specified Person or any of such Person’s properties or assets. Applicable Laws include any laws, regulations, ordinances, constitutions, regulations, statutes, treaties, rules, codes, licenses, certificates, franchises, Permits, or other legal requirements governing the Companies, their properties, assets and operations.

“ Arbitration ” has the meaning set forth in Section 10.16 of this Agreement.

“ Balance Sheets ” has the meaning set forth in Section 3.11(a) of this Agreement.

“ Balance Sheet Dates ” has the meaning set forth in Section 3.11(a) of this Agreement.

“ Benefit Plan ” means any and all bonus, stock option, restricted stock, stock purchase, stock appreciation, phantom stock, profit participation, profit-sharing, deferred compensation, severance, retention, pension, retirement, health, disability, life or other insurance, death benefit, incentive compensation, welfare, or any other employee benefit plan, policy or arrangement maintained, sponsored or contributed to by either of the Companies for the benefit of any Employee.

“ Business ” means the business operations of SSI and UCA, including Specialty Surgical Instrumentation Distribution and SSI Ultra Instrument.

“ Cash ” means all cash as shown on the Balance Sheets of the Companies as either in-hand or accrued as of the Closing Date.

“ CERCLA ” means the Comprehensive Environmental Response, Compensation and Liability Act (42 U.S.C. § 9601 et seq.).

“ Closing ” has the meaning set forth in Section 2.5(a) of this Agreement.

“ Closing Date ” has the meaning set forth in Section 2.5(a) of this Agreement.

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

“ Companies ” has the meaning set forth in the Recitals to this Agreement.

“ Companies Welfare Plans ” has the meaning set forth in Section 9.2(c) of this Agreement.

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“ Confidential Information ” means any information or compilation of information not generally known to the public or the industry in which the Companies are engaged and which the Companies have not disclosed to third parties without a written obligation of confidentiality, which is proprietary to the Companies, relating to the Companies’ procedures, techniques, methods, concepts, ideas, affairs, products, processes and services, including, but not limited to, information, to the extent proprietary to the Companies, relating to marketing, merchandising, selling, research, development, manufacturing, purchasing, accounting, engineering, financing, costs, customers, plans, pricing, billing, needs of customers and products and services used by customers, all lists of customers and their addresses, prospects, sales calls, products, services, prices and the like as well as any specifications, formulas, plans, drawings, accounts or sales records, sales brochures, code books, manuals, trade secrets, knowledge, know-how, pricing strategies, operating costs, sales margins, methods of operations, invoices or statements and the like. Confidential Information shall not include information which (i) becomes generally available to the public other than as a result of a disclosure by a party to this Agreement, (ii) was available on a non-confidential basis prior to its disclosure, or (iii) is independently developed as evidenced by written records without making use of the Confidential Information.

“ Contract ” means any agreement, lease of personal or mixed property, license, contract, obligation, promise, commitment, arrangement, understanding or undertaking, instrument, document (whether written or oral and whether express or implied) of any type, nature or description, but excluding leases of Leased Real Estate. As used herein, the word “Contract” shall be limited in scope if modified by an adjective specifying the type of contract to which this Agreement or a Section hereof refers.

“ Damages ” has the meaning set forth in Section 7.1(f) of this Agreement.

“ Debt ” means: (i) any long-term or short-term interest-bearing indebtedness of the Companies owed to third parties; (ii) any inter-company indebtedness; (iii) Sellers’ guarantees outstanding, issued to secure obligations of the Companies; (iv) any capital leases; and (v) any letters of credit (whether drawn against or not).

“ Debt Adjustment ” has the meaning set forth in Section 2.2(b) of this Agreement.

“ Debt-Free ” means that all Debt shall be deducted from the Interim Purchase Price and Final Purchase Price payable to Sellers determined as due as of the Closing Date.

“ Disclose ” means to reveal, deliver, divulge, disclose, publish, copy, communicate, show or otherwise make known or available to any other Person, or in any way to copy, any of the Confidential Information of the Companies.

“Earn-Out Agreement” has the meaning set forth in Section 2.2(c) of this Agreement.

“ Employees ” has the meaning set forth in Section 3.20(a) of this Agreement.

“ Encumbrance ” means and includes:

(i)            with respect to any personal property, any intangible property or any property other than real property, any security or other property interest or right, claim,

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lien, pledge, option, security interest, contingent or conditional sale, or other title claim or retention agreement or lease or use agreement in the nature thereof whether voluntarily incurred or arising by operation of law, and including any agreement to grant or submit to any of the foregoing in the future; and

(ii)           with respect to any real property, any mortgage, lien, easement, interest, right-of-way, condemnation or eminent domain proceeding, encroachment, any building, use or other form of restriction, encumbrance or other claim (including adverse or prescriptive) or right of third parties (including any Governmental Body), any lease or sublease, boundary dispute, and agreements with respect to any real property including: purchase, sale, right of first refusal, option, construction, building or property service, maintenance, property management, conditional or contingent sale, use or occupancy, franchise or concession, whether voluntarily incurred or arising by operation of law, and including any agreement to grant or submit to any of the foregoing in the future.

“ Environmental Laws ” means any and all Applicable Laws, all court orders, decrees, arbitration awards, and applicable common law which pertain to environmental matters or environmental contamination of any type whatsoever, including, but not limited to, those (i) regulating the manufacturing process, use, treatment, generation, transportation, storage, control, management, recycling or disposal of any Hazardous Material, including, but not limited to, CERCLA, SARA, the Resource Conservation and Recovery Act (42 U.S.C. § 6901 et seq.), the Hazardous Materials Transportation Act (49 U.S.C. § 1801 et seq.), the Federal Water Pollution Control Act (33 U.S.C. § 1251 et seq.), the Clean Water Act (33 U.S.C. § 1251 et seq.), the Clean Air Act (42 U.S.C. § 7401 et seq.), the Toxic Substances Control Act (15 U.S.C. § 2601 et seq.), the Safe Drinking Water Act (42 U.S.C. § 300F et seq.), and/or (ii) relating to the protection, preservation or conservation of the environment, or protection of wildlife, endangered species, wetlands or national resources.

“ Environmental Permits ” means every license, permit, registration, governmental approval, agreement and consent applied for, pending by, issued or given to either of the Companies in connection with the operation of the Business, and every agreement with a Governmental Body entered into by either of the Companies in connection with the operation of the Business, which is in effect or has been applied for or is pending in each case which is required under or is issued pursuant to Environmental Laws.

“ Environmental Representations ” has the meaning set forth in Section 3.24 of this Agreement.

“Equity Interests” means 100% of the Shares and 100% of the Membership Interests.

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

“ Escrowed Funds ” has the meaning set forth in Section 2.4(a) of this Agreement.

“ Facility ” means any facility as defined in CERCLA.

“ Final Closing Statement ” has the meaning set forth in Section 2.3(c) of this Agreement.

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“ Final Purchase Price ” has the meaning set forth in Section 2.3(b) of this Agreement.

“ GAAP ” means generally accepted accounting principles in the United States.

“ Governmental Body ” means any:

(i)            nation, state, county, city, town, village, district or other jurisdiction of any nature;

(ii)           federal, state, local, municipal, foreign or other government;

(iii)          governmental or quasi-governmental authority of any nature (including any governmental agency, branch, board, commission, department, instrumentality, office or other entity, and any court or other tribunal);

(iv)          multinational organization or body; and/or

(v)           body exercising, or entitled to exercise, any administrative, executive, judicial, legislative, police, regulatory or taxing authority or power of any nature.

“ Hazardous Materials ” means any and all (i) dangerous, toxic or hazardous pollutants, contaminants, chemicals, wastes, materials or substances listed or identified in, or directly or indirectly regulated by, any Environmental Laws, and (ii) any of the following, whether or not included in the foregoing:  polychlorinated biphenyls, asbestos in any form or condition, urea-formaldehyde, petroleum (including crude oil or any fraction thereof), natural gas, natural gas liquids, liquefied natural gas, synthetic gas usable for fuel or mixtures thereof, nuclear fuels or materials, chemical wastes, man-made radioactive materials, explosives and known possible carcinogens.

“ Indemnified Party ” has the meaning set forth in Section 7.5(a) of this Agreement.

“ Indemnifying Party ” has the meaning set forth in Section 7.5(a) of this Agreement.

“ Injunction ” means any and all writs, rulings, awards, directives, injunctions (whether temporary, preliminary or permanent), judgments, decrees or orders (whether executive, judicial or otherwise) adopted, enacted, implemented, promulgated, issued, entered or applicable by or under the authority of any Governmental Body.

“ Intellectual Property ” means any and all: (i) inventions (whether patentable or unpatentable and whether or not reduced to practice), all improvements thereto, and all patents, patent applications and patent disclosures, together with all reissuances, continuations, continuations in part, revisions, extensions and re-examinations thereof; (ii) trademarks, service marks, trade dress, logos, trade names, assumed names and corporate names, together with all translations, adaptations, derivations and combinations thereof and including all goodwill associated therewith, and all applications, registrations and renewals in connection therewith; (iii) copyrightable works, all copyrights and all applications, registrations and renewals in connection therewith; (iv) mask works and all applications, registrations and renewals in connection therewith; (v) trade secrets and confidential business information (including ideas,

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research and development, know-how, technology, formulas, compositions, manufacturing and production processes and techniques, technical data, designs, drawings, specifications, customer and supplier lists, pricing and cost information and business and marketing plans and proposals); (vi) computer software and all related and necessary licenses (including data and related software program documentation in computer-readable and hard-copy forms other than for so-called off-the-shelf products); (vii) other intellectual property and proprietary rights of any kind, nature or description, including web sites, web site domain names and other e-commerce assets and resources of any kind or nature; and (viii) copies of tangible embodiments thereof (in whatever form or medium).

“ Interim Purchase Price ” has the meaning set forth in Section 2.2(a) of this Agreement.

“ IRS ” means the United States Internal Revenue Service.

“ Leased Real Estate ” has the meaning set forth in Section 3.17(a) of this Agreement.

“ Leases ” has the meaning set forth in Section 3.17(a) of this Agreement.

“ Letter of Credit ” has the meaning set forth in Section 2.4(c).

“ Liability ” or “ Liabilities ” means any and all debts, liabilities and/or obligations of any type, nature or description (whether known or unknown, asserted or unasserted, secured or unsecured, absolute or contingent, accrued or unaccrued, liquidated or unliquidated and whether due or to become due).

“ Material Adverse Effect ” or “ Material Adverse Change ” means, in connection with the Companies with due consideration to the size and complexity of the Business and transactions contemplated by this Agreement, any event, change or effect that is materially adverse, individually or in the aggregate, to the condition (financial or otherwise), properties, assets, Liabilities, revenues, income, business, operations, results of operations of such Persons, taken as a whole. In furtherance of the foregoing, and notwithstanding anything to the contrary set forth in this Agreement, any Material Adverse Effect or any Material Adverse Change with respect to the Companies shall be evaluated on the basis of the Companies individually or taken as a whole (in the aggregate).

“Membership Interests” means 100% of the outstanding membership interests of UCA.

“ Ordinary Course of Business ” means an action taken by a Person only if:

(i)            such action is consistent with the past practices of such Person, is in compliance with all Applicable Laws and is taken in the ordinary course of the normal day-to-day operations of such Person; and

(ii)           such action is not required to be authorized by the board of directors of such Person (or by any Person or group of Persons constituting a governing body of a Person exercising similar authority).

“ Overlap Period ” has the meaning set forth in Section 8.2(a) of this Agreement.

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“ Owned Real Estate ” has the meaning set forth in Section 3.17 of this Agreement.

“ Permits ” means all permits, licenses, consents,  franchises, orders, certifications, registrations, certificates of authority, variances, approvals, local siting approvals and other authorizations obtained from, or filed with any Governmental Body or other Person, or other similar rights, including, without limitation, those listed on Schedule 3.30 of the Schedules.

“Permitted Liabilities” has the meaning set forth in Section 3.11(a) of this Agreement.

“ Person ” means any individual, corporation (including any non-profit corporation), general, limited or limited liability partnership, limited liability company, joint venture, estate, trust, association, organization, or other entity or Governmental Body.

“ Pre-Closing Period ” has the meaning set forth in Section 3.8(b) of this Agreement.

“ Proceeding ” means any suit, litigation, arbitration, hearing, audit, investigation, order, or other action (whether civil, criminal, administrative or investigative) commenced, brought, conducted, or heard by or before, or otherwise involving, any Governmental Body or arbitrator.

“ Purchase Price Escrow Agreement ” has the meaning set forth in Section 2.4(a) of this Agreement.

“ Purchaser ” has the meaning set forth in the introductory paragraph of this Agreement.

“ Purchaser Indemnities ” has the meaning set forth in Section 7.1(f) of this Agreement.

“ Purchaser Welfare Plans ” has the meaning set forth in Section 9.2(c) of this Agreement.

“ Real Estate ” means the Owned Real Estate and the Leased Real Estate.

“ Real Property Sale and Purchase Agreement ” means the agreement between Sellers’ Affiliate, MFW Investments, and Purchaser’s wholly owned subsidiary, Symmetry Medical SSI Real Estate, LLC, for the sale of the real estate commonly known as 200 River Hills Drive, Nashville, Davidson County, Tennessee.

“ Release ” means any spill, discharge, leak, emission, escape, leaching, disposing, emptying, pouring, pumping, injection, dumping, or other release of any Hazardous Materials into the environment, whether or not notification or reporting to any governmental agency was or is required, including any Release which is subject to CERCLA.

“ Rights ” means any and all outstanding subscriptions, warrants, options, or other arrangements or commitments obligating (with or without notice or passage of time or both) one or both of the Companies to issue or dispose of any of its or their (as opposed to third party) securities.

“ SARA ” means the Superfund Amendments and Reauthorization Act (42 U.S.C. § 9601 et seq.).

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“ Sellers ” has the meaning set forth in the introductory paragraph of this Agreement.

“ Sellers Indemnities ” has the meaning set forth in Section 7.1(f) of this Agreement.

“ Sellers’ Knowledge ” means the actual knowledge after a reasonable investigation of Louis C. Wallace and Charles O. Mann, Jr. or of any officer, member, director or Senior Management Employees of Companies.

“ Senior Management Employees ” means Steven L. Tanner, Financial Manager, Barbara Briley, Controller, Judy Burchett, Instrument Administrator, Mickey Wormsley, Contract Manager, Keith Sweeney, Sales Manager of Surgical Instruments, and Amy Roberts, Purchasing Manager, and the chief executive officer, president, any vice president or director, of the Companies.

“Shares” means 100% of the outstanding stock of SSI.

“ Survival Period ” has the meaning set forth in Section 7.1(a) of this Agreement.

“ Target Working Capital ” means the amount of $2,946,205

“ Tax ” or “ Taxes ” means any and all net income, gross income, gross revenue, gross receipts, net receipts, ad valorem, franchise, profits, deferred, transfer, sales, use, social security, employment, unemployment, disability, license, withholding, payroll, privilege, excise, value-added, severance, stamp, occupation, property, customs, duties, real estate and/or other taxes, assessments, levies, fees or charges of any kind whatsoever imposed by any Governmental Body, together with any interest or penalty relating thereto.

“ Tax Matter ” has the meaning set forth in Section 8.2(a) of this Agreement.

“ Tax Return ” or “ Tax Returns ” means any return, declaration, report, claim for refund or information return or statement relating to Taxes, including, without limitation, any schedule or attachment thereto, any amendment thereof, and any estimated report or statement.

“ Threatened ” means a claim, Proceeding, dispute, action, or other matter for which any written demand or statement has been made, orally or in writing, or any oral or written notice has been given, that would lead a reasonably prudent Person to conclude that such a claim, Proceeding, dispute, action, or other matter may be asserted, commenced, taken or otherwise pursued in the future.

“ Use ” means to appropriate any of the Confidential Information of the Companies for the benefit of oneself or any other Person other than the Companies.

“ WARN Acts ” has the meaning set forth in Section 3.9(l) of this Agreement.

“ Working Capital ” means “Current Assets” less “Current Liabilities.”  “Current Assets” means the sum of accounts receivable (net of allowances), prepaid expenses, inventory (net of reserves), cash and cash equivalents, and other current assets of the Companies as determined in accordance with GAAP consistently applied. “Current Liabilities” means the sum of accounts

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payable and accrued expenses of the Companies, excluding Debt and accrued interest defined as Debt and as determined in accordance with GAAP consistently applied.

“ Working Capital Adjustment ” has the meaning set forth in Section 2.3 of this Agreement.

ARTICLE 2

PURCHASE OF EQUITY INTERESTS; PURCHASE PRICE

2.1.         Purchase and Sale of Equity Interests. In reliance upon the representations, warranties and covenants contained in this Agreement as of the date hereof and on the Closing Date, Purchaser agrees to purchase the Equity Interests from Sellers, and Sellers agree to sell, transfer, convey, assign and deliver the Equity Interests to Purchaser on the terms and conditions set forth in this Agreement. Such sale, transfer, conveyance, assignment and delivery of the Equity Interests shall convey good and marketable title to the Equity Interests, free and clear of any and all Rights and Encumbrances, and at such time the Equity Interests will be fully paid and non-assessable. At the Closing Sellers will deliver to Purchaser certificate(s) evidencing the Shares duly endorsed in blank or with stock powers duly executed by Sellers and one or more assignments of the Membership Interests duly executed by Sellers.

2.2.         Purchase Price.

(a)           The purchase price to be paid to Sellers by Purchaser for the Equity Interests shall be $14,050,000 as may be adjusted at the Closing Date, and post Closing as provided by this Agreement. The cash purchase price will be allocated among the Shares and the Membership Interests in accordance with Schedule 2.2. The cash purchase price for the Equity Interests shall be referred to as the “Interim Purchase Price.”  The Interim Purchase Price shall be adjusted to determine the Final Purchase Price, as provided in this Section 2.2 and Sections 2.3 and 2.4. The Interim Purchase Price shall be paid on the Closing Date to Wallace and Mann by wire transfer of immediately available funds to an account (or accounts) designated by Sellers at least two (2) calendar days prior to the Closing.

(b)           The Interim Purchase Price has been based on the assumption that the Companies shall be Debt-Free as of the Closing Date. To the extent that the Companies have Debt as of the Closing Date, the Interim Purchase Price shall be reduced on the Closing Date by the aggregate amount of the Debt (the “Debt Adjustment”) and such Debt Adjustment shall be paid directly by Purchaser to such creditor or creditors, but may be paid from Closing proceeds.

(c)           In addition to the cash consideration set forth in 2.2(a), the Purchaser will enter into an Earn-Out Agreement with Sellers in substantially the form set forth in Exhibit A attached hereto. The Earn-Out Agreement includes a separate earn-out formula for SSI and for UCA. In addition, Purchaser’s wholly-owned subsidiary will enter into the Real Property Sale and Purchase Agreement with Sellers’ Affiliate MFW Investments in substantially the form set forth in Exhibit B attached hereto.

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2.3.         Working Capital Adjustment.

(a)           The Working Capital Adjustment will be estimated and made at Closing based upon the average monthly Working Capital for the six (6) calendar months ending immediately preceding the month that includes the Closing Date, as reported on the Companies’ financial statement and the Interim Purchase Price shall then be further adjusted after the Closing Date by an amount of dollars, positive or negative, as the case may be, equal to the difference between the Target Working Capital and the Working Capital as shown on the Final Closing Statement, which will be used to determine the Final Purchase Price.

(b)           If the Working Capital on the Final Closing Statement is:

(i)            less than the Target Working Capital, an amount equal to the deficit shall be payable from Sellers to Purchaser (such amount may not be paid out of the Escrowed Funds);

(ii)           greater than the amount shown on the Target Working Capital, an amount equal to the surplus shall be payable from Purchaser to Sellers;

(iii)          equal to the amount shown on the Target Working Capital, no amount shall be due to either party.

The adjustment provided for in this Section 2.3 shall be known as the “Working Capital Adjustment.”

The Interim Purchase Price, after application of the Working Capital Adjustment, shall constitute the “Final Purchase Price.”

(c)           Within seventy-five (75) calendar days following the Closing Date, Sellers and Purchaser, as applicable, shall cause the Companies to prepare and deliver to Purchaser and Sellers, in good faith, a final balance sheet and closing statement setting forth the Working Capital Adjustment in accordance with this Section 2.3 (the “Final Closing Statement”). This Final Closing Statement shall be prepared by Purchaser’s auditors, Ernst & Young LLP at Purchaser’s cost. Within thirty (30) calendar days following Purchaser’s and Sellers’ receipt of the Final Closing Statement, Purchaser or Sellers may object in good faith to the Working Capital Adjustment in writing. In the event of any such objection, Purchaser and Sellers shall attempt to resolve their differences by negotiation. If such parties are unable to do so within thirty (30) calendar days following receipt of the objecting party’s objection, Sellers and Purchaser shall appoint another nationally recognized accounting firm mutually acceptable to each of Sellers and Purchaser, which shall, at Sellers’ and Purchaser’s joint expense, review the Final Closing Statement and determine the Working Capital Adjustment, if any, within thirty (30) calendar days of such appointment. Sellers and Purchaser agree to cooperate with such accounting firm and provide it with such information as it reasonably requests to enable it to make such determination. The findings of such accounting firm shall be binding on the parties hereto. If Purchaser decides to establish a new accrual for environmental liabilities on the Final Closing Statement, this new accrual will be excluded from calculation of the Working Capital Adjustment.

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(d)           Any amounts owed hereunder shall be paid to the party owed the same by the party owing the same by wire transfer of immediately available funds to an account designated by the party owed the same no later than five (5) business days following the determination by agreement of Sellers and Purchaser or by binding determination of said accounting firm of the Working Capital Adjustment, and such payment shall be accompanied by an additional payment of interest, calculated based on an 8.25% annual interest rate from the Closing Date to the date of payment pursuant to this Section 2.3.

2.4.         Escrow Agreement.

(a)           Sellers agree and authorize Purchaser to retain from the Interim Purchase Price and deposit in an interest bearing escrow account (the “Escrow Account”) with First Tennessee Bank National Association, Nashville, Tennessee (“Escrow Agent”) the sum of Two Million Seventy Thousand and 00/100 Dollars ($2,070,000.00) (the “Escrowed Funds”) as collateral security to be used as the initial source of funds for any indemnification obligation of Sellers arising under Section 7.2, in accordance with an escrow agreement in substantially the form set forth in Exhibit C attached hereto (the “Purchase Price Escrow Agreement”). The Escrowed Funds shall not be used for purposes of the Working Capital Adjustment.

(b)           The term of the Purchase Price Escrow Agreement shall be two (2) years; provided, however, that on the first anniversary of the Closing Date, $1,035,000 of the Escrowed Funds, reduced by a reserve equal to the aggregate amount of any claims previously asserted by Purchaser pursuant to Section 7.5 that are unresolved or unpaid as of the first anniversary of the Closing Date, shall be released to Sellers (but in no event shall this release of funds reduce the balance of the Escrowed Funds to less than $1,035,000). On the second anniversary of the Closing Date all remaining Escrowed Funds, reduced by a reserve equal to the aggregate amount of any claims previously asserted by Purchaser pursuant to Section 7.5 that are unresolved or unpaid as of the second anniversary of the Closing Date, shall be released to Sellers. All escrow fees shall be shared equally by the parties and, to the extent known, paid in advance; additional fees incurred during the term of the Escrow Account shall be paid from income earned on the Escrowed Funds, or, if such income is insufficient, paid from the Escrowed Funds.

(c)           As an alternative to establishing the Escrow Account, Sellers may elect to provide to Purchaser at Closing a standby letter of credit in the original amount of Two Million Seventy Thousand and 00/100 Dollars ($2,070,000.00), issued in a form and by a financial institution satisfactory to Purchaser (the “Letter of Credit”). Such Letter of Credit shall be irrevocable and shall remain in place for a period of twenty-four (24) months and thereafter if pending indemnification claims exist at the third anniversary of the Closing Date, provided, however, that the face amount of the Letter of Credit may be reduced on the first anniversary of the Closing Date on the same conditions as and consistent with the schedule of reductions described in Section 2.4(b). On the second anniversary of the Closing Date, if no indemnification claim(s) by Purchaser is then pending, the Letter of Credit may be terminated. If not terminated on the second anniversary of the Closing Date, the Letter of Credit shall be terminated following resolution of any indemnification claims pending on such date. All fees associated with the Letter of Credit shall be paid by Sellers.

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2.5.         Closing and Closing Deliveries.

(a)           Closing and Closing Date . The closing of the transactions contemplated by this Agreement (the “Closing”) shall be held on August 31, 2007 (or as soon as all conditions in Article 6 are satisfied). The date on which the Closing occurs is referred to in this Agreement as the “Closing Date.”

(b)           Closing Deliveries by Sellers . At the Closing, Sellers shall execute, where necessary or appropriate, and deliver to Purchaser each and all of the following:

(i)            The certificates, free of all Encumbrances, evidencing the Shares duly endorsed by Sellers in blank or accompanied by stock powers duly executed by Sellers and one or more assignments of the Membership Interests duly executed by Sellers in favor of Purchaser or its nominee;

(ii)           The corporate minute books, the corporate seals, and stock books, if any, for the Companies;

(iii)          A duly executed written opinion letter by counsel for Sellers, dated as of the Closing Date, addressed to Purchaser;

(iv)          Duly executed resignations of (A) the officers of SSI and UCA who are designated by Purchaser, and (B) the directors, limited liability company managers and/or members of SSI and UCA, all effective as of the Closing Date;

(v)           Certificates of Existence for SSI and UCA issued by the Tennessee Secretary of State;

(vi)          The non-foreign person affidavit required by Section 1445 of the Code;

(vii)         Employment Agreements for Louis C. Wallace, Charles O. Mann, Jr. and Steve Tanner in substantially the form set forth in Exhibit D attached hereto;

(viii)        Non Competition Agreements for Louis C. Wallace, Charles O. Mann, Jr. and Steven Tanner in the form set forth in Exhibit E ;

(ix)           the Purchase Price Escrow Agreement executed by Sellers or Letter of Credit;

(x)            a statement executed by the Companies pursuant to Treas. Reg. §1.897-2(h), dated no more than thirty (30) days prior to Closing, certifying that (i) the Equity Interests do not constitute a U.S. real property interest, or (ii) none of the owners of the Companies are foreign persons;

(xi)           all third-party consents necessary to operate the Business;

(xii)          Waiver and Release executed by Sellers and each director, limited liability company manager and/or member of SSI and UCA;

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(xiii)         Such other documents and items as are reasonably necessary or appropriate to effect the consummation of the transactions contemplated hereby;

(xiv)        Non-Disclosure and Non-Competition Agreement for Sellers, as required by Section 4.2 of this Agreement and in the form set forth as Exhibit F ;

(xv)         Real Property Sale and Purchase Agreement executed by Sellers’ Affiliate, MFW Investments;

(xvii)       Earn-Out Agreement executed by Sellers; and

(xviii)      All third-party consents necessary for Purchaser to consummate the transactions contemplated by this Agreement and as set forth in Article 6.

(c)           Closing Deliveries by Purchaser . At the Closing, Purchaser shall execute, where necessary or appropriate, and deliver to Sellers each and all of the following:

(i)            Payment of the Interim Purchase Price in the manner set forth in Section 2.2 of this Agreement;

(ii)           A copy certified by the Secretary of Purchaser of the duly adopted resolutions of the Board of Directors of Purchaser approving this Agreement, including the Ancillary Documents, and authorizing the execution and delivery of this Agreement and the Ancillary Documents, and the consummation of the transactions contemplated hereby and thereby.

(iii)          A duly executed written opinion letter by counsel for Purchaser, dated as of the Closing Date, addressed to Sellers;

(iv)          A Certificate of Good Standing of Purchaser issued by the Secretary of State of Purchaser’s state of incorporation or the equivalent;

(v)           Such other documents and items as are reasonably necessary or appropriate to effect the consummation of the transactions contemplated hereby or which are customary under local law;

(vi)          Real Property Sale and Purchase Agreement executed by Symmetry Medical SSI Real Estate, LLC;

(vii)         Earn-Out Agreement executed by Purchaser;

(viii)        Employment Agreements for Louis C. Wallace, Charles O. Mann, Jr. and Steve Tanner in substantially the form set forth in Exhibit D attached hereto;

(ix)           Non Competition Agreements for Louis C. Wallace, Charles O. Mann, Jr. and Steven Tanner in the form set forth in Exhibit E ; and

(x)            The Purchase Price Escrow Agreement executed by Purchaser.

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ARTICLE 3

REPRESENTATIONS AND WARRANTIES OF SELLERS

As an inducement for Purchaser to enter into this Agreement and to consummate the transactions contemplated hereby, Sellers represents and warrants to Purchaser that each and all of the following representations and warranties are true and correct as of the date of this Agreement and at Closing. The Schedules shall be arranged in paragraphs corresponding to the sections and subsections contained in this Article 3.

3.1.         Organization and Good Standing.

(a)           Schedule 3.1 contains a complete and accurate list for SSI and UCA of their jurisdiction of incorporation (or other formation). Each of SSI and UCA is duly incorporated or organized, validly existing, and in good standing under the laws of its jurisdiction of incorporation, with full power and authority to conduct its respective businesses as same are now being conducted, to own or use the properties and assets that it purports to own, lease, operate or use in the conduct of the Business, and to perform all its obligations under any Contracts. Each of SSI and UCA is licensed or qualified to transact business and is in good standing as a foreign corporation in each jurisdiction in which, because of its business conducted there or the nature of its assets or properties there, it is required to be so licensed or qualified. Each such foreign jurisdiction is set forth in Schedule 3.1 .

(b)           Sellers have delivered to Purchaser copies of the organizational documents of SSI and UCA, as currently in effect.

3.2.         Authority; No Conflict.

(a)           This Agreement constitutes the legal, valid, and binding obligation of Sellers, enforceable against Sellers in accordance with its terms. The Ancillary Documents to be delivered by Sellers at Closing will constitute the legal, valid, and binding obligations of Sellers, enforceable against Sellers in accordance with their respective terms. Each of the Sellers has the right, power, authority, and capacity to execute and deliver this Agreement and the Ancillary Documents to which he is a party, and to perform his obligations hereunder and thereunder. The execution, delivery and performance of this Agreement and the Ancillary Documents to which the Sellers are or shall be a party have been duly authorized by all necessary action on the part of Sellers. This Agreement and the Ancillary Documents have been duly executed and delivered by each of the Sellers who is a party thereto.

(b)           Except as set forth on Schedule 3.2(b) , neither the execution nor delivery of this Agreement and the Ancillary Documents nor the consummation or performance of any of the contemplated transactions will, directly or indirectly:

(i)            contravene, conflict with, or result in a violation of (A) any provision of the organizational documents of the Companies, or (B) any resolution adopted by the board of directors, the shareholders or members of the Companies;

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(ii)           contravene, conflict with, or result in a breach or violation of, or constitute a default under (or an event which, with or without notice, lapse of time or both, would constitute a default) or result in the invalidity of, or accelerate the performance required by or cause or give rise to any right of acceleration or termination of any right or obligation pursuant to any agreement or commitment to which Sellers or the Companies are a party or by which Sellers or the Companies (or any of their respective assets or properties) is subject or bound;

(iii)          result in the creation of, or give any third party the right to create, any Encumbrance upon the Equity Interests or any assets or properties of Sellers or the Companies;

(iv)          conflict with any Applicable Laws to which Sellers or the Companies or any assets or properties of any of the foregoing are subject;

(v)           terminate or modify, or give any third party the right to terminate or modify, the provisions or terms of any contract or agreement to which Sellers or the Companies are a party or by which Sellers or the Companies, (or any of their respective assets or properties) is subject or bound;

(vi)          require Sellers or the Companies to obtain any consent; or

(vii)         result in or give to any Person any additional rights or entitlement to increased, additional, accelerated or guaranteed payments under any contract or agreement to which Sellers or the Companies are a party or by which any of their respective assets or properties is subject or bound.

3.3.         Capitalization.

(a)           The authorized capital stock of SSI consists solely of 20,000 shares of common voting stock, no par value, of which 11,559 shares are issued and outstanding on the date hereof, and are all owned beneficially and of record by Sellers, free and clear of all Rights and Encumbrances. The Equity Interests are validly issued, fully paid and nonassessable and were issued in compliance with Applicable Laws. None of the Equity Interests have been issued in violation of the rights of any Person. As of the date hereof, (i) there are no Rights outstanding, and (ii) there are no agreements, understandings or commitments relating to the rights of Sellers to vote or dispose of the shares except as set forth on Schedule 3.3(a) , all of which shall be released or terminated on or before Closing.

(b)           All of the Membership Interests of UCA are owned beneficially and of record by Sellers, free and clear of all Rights and Encumbrances. The Membership Interests are validly issued, fully paid and nonassessable and were issued in compliance with Applicable Laws. None of the Membership Interests have been issued in violation of the rights of any Person. As of the date hereof, (i) there are no Rights outstanding, and (ii) there are no agreements, understandings or commitments relating to the rights of Sellers to vote or dispose of the Membership Interests except as set forth on Schedule 3.3(b) ,.

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3.4.         Clear Title. Except as set forth in Schedule 3.4 or the leased property disclosed in Schedule 3.15(d) hereto, on the Closing Date, (i) the Companies hold good title (or valid and enforceable leasehold interests) to their  personal property, and (ii) such personal property is and shall be free and clear of any and all Encumbrances of any kind, nature and description whatsoever, except for Encumbrances which are disclosed, reflected or reserved for or against in the Balance Sheets, or are being released by payment from Closing proceeds.

3.5.         Condition of Assets. Except as set forth on Schedule 3.5 , all of the properties and assets of the Companies are the assets used to operate the Business as currently conducted, (i) such properties and assets have been adequately maintained, consistent with past practices, and are in operating condition, normal wear and tear excepted, and (ii) all leased property is in the condition received by the Companies at the time of the lease, normal wear and tear excepted.

3.6.         Legal Proceedings. Except as set forth on Schedule 3.6 , there is not now pending nor have been in the thirty-six (36) months prior to the date hereof, any Proceedings of any kind or nature whatsoever, at law or in equity, by or before any court or Governmental Body. Except as set forth on Schedule 3.6 , there are no Proceedings of any kind or nature whatsoever, at law or in equity, by or before any court or Governmental Body, or to Sellers’ Knowledge, Threatened against:

(a)           the Companies, their assets, properties, officers or directors, or which questions or challenges the validity of this Agreement, any Ancillary Document or any action taken or to be taken by Sellers pursuant to this Agreement, the Ancillary Document or in connection with the contemplated transactions; and, to Sellers’ Knowledge, there is no valid basis for any such claim, action, suit, inquiry, proceeding or investigation;

(b)           Sellers, which would adversely affect the consummation of the contemplated transactions; or

(c)           the Companies are not subject to any judgment, order or decree. The Companies have delivered to Purchaser copies of all pleadings, correspondence, and other documents relating to any of the foregoing.

3.7.         Labor Matters. Except as set forth in Schedule 3.7 hereto, the Companies have never been a party to any collective bargaining agreement or other labor Contract and there is not presently pending or existing, and to Sellers’ Knowledge or the Companies’, there is not Threatened (i) any strike, slowdown, walkout, picketing, work stoppage, labor arbitration or other Proceeding in respect of the grievance of any employee, (ii) any application or complaint filed by any employee or union with the National Labor Relations Board, the Equal Employment Opportunity Commission, the Occupational Safety and Health Administration or any comparable Governmental Body, (iii) any other employee claim under any Applicable Laws; or (iv) any organizational activity or other labor dispute against or affecting the Companies, and no application for certification of a collective bargaining agreement is pending or, to Sellers’ Knowledge, is Threatened. There is no lockout of any employees by the Companies and no such action is contemplated by the Companies. Except as set forth in Schedule 3.7 hereto, there is no Proceeding pending or, to Sellers’ Knowledge, Threatened by any Person against the Companies

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or any of their current or former officers, directors or employees relating to employment, equal employment opportunity, discrimination, harassment, wrongful discharge, unfair labor practices, immigration, wages, hours, benefits, collective bargaining, the payment of social security or similar Taxes, occupational safety and health or plant closing. Except as disclosed in Schedule 3.7 , there are no worker’s compensation claims pending against the Companies, and to Sellers’ Knowledge there is no basis for any such claim.

3.8.         Tax Matters.

(a)           Tax Returns . The Companies have timely filed, or caused to be timely filed, with the appropriate taxing authorities, all Tax Returns that are required to be filed by, or with respect to the Companies on or prior to the Closing Date. The Tax Returns have accurately reflected and will accurately reflect all Liability for Taxes of the Companies for the periods covered thereby. Schedule 3.8(a) lists all income Tax Returns filed with any Governmental Body with respect to the Companies for the taxable periods ended on or after December 31, 2002.

(b)           Payment of Taxes . All Taxes and Tax Liabilities of the Companies for all taxable years or periods that end on or before the Closing Date and, with respect to any taxable year or period beginning before and ending after the Closing Date, the portion of such taxable year or period ending on the day immediately preceding the Closing Date (“Pre-Closing Period”) have been timely paid to the extent due and/or adequate provisions have been made for taxes which have accrued and/or become due or become due through the Closing Date and there are no further Liabilities for any Taxes, except as reflected in Schedule 3.8(b) .

(c)           Other Tax Matters . Except as set forth in Schedule 3.8(c) :

(i)            The Companies have not been the subject of a dispute or claim or an audit or other examination of Taxes by the Tax authorities of any Governmental Body, nor have the Companies received any notices from any such taxing authority.

(ii)           Sellers and the Companies have not (A) entered into an agreement or waiver or been requested to enter into an agreement or waiver extending any statute of limitations relating to the payment or collection of Taxes of the Companies, or (B) contested the Tax Liability of the Companies before any Governmental Body.

(iii)          The Companies have not been included in any “consolidated,” “unitary” or “combined” Tax Return provided for under Applicable Law with respect to Taxes for any taxable period for which the statute of limitations has not expired.

(iv)          All Taxes which the Companies are (or have been) required by law to withhold or collect have been duly withheld or collected, and have been timely paid over to the proper authorities to the extent due and payable.

(v)           There are no Tax sharing, allocation, indemnification or similar agreements in effect as between the Companies or any predecessor thereof and any other party (including Sellers and any predecessors) under which Purchaser or the Companies would be liable for any Taxes or other claims of any Person.

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(vi)          Within the past ten (10) years, the Companies have not (A) acquired assets from another corporation in a transaction in which Companies’ tax basis for the acquired assets was determined, in whole or in part, by reference to the Tax basis of the acquired assets (or any other property) in the hands of the transferor or (B) acquired the stock of any corporation that is or was a qualified subchapter S subsidiary.

(vii)         There is no action, suit, taxing authority proceeding, audit or investigation now in progress, pending or, to Sellers’ Knowledge, Threatened against or with respect to the Companies with respect to any Tax.

(viii)        The Companies do not reasonably expect any taxing authority to claim or assess any additional Tax against them for any period ending on or prior to the Closing Date, and to Sellers’ Knowledge, there is no basis for any such claim or assessment.

(ix)           The Companies have not distributed stock of another Person, nor had its stock distributed by another Person, in a transaction that purported or was intended to be governed in whole or in part by IRC Section 355 or Section 361.

(x)            The Companies have not been a member of an affiliated or similar group filing a consolidated, combined, unitary or similar income tax return or has any liability for the Taxes of any Person under Treas. Reg. §1.1502-6 (or any similar provision of state, local or foreign law), as a transferee or successor, by agreement, or otherwise.

3.9.         Employee Benefits.

(a)           Schedule 3.9 (a) is a complete list of each “Benefit Plan” (within the meaning of Section 3(3) of ERISA) and each other employee benefit plan, agreement, policy, trust fund or arrangement (whether written or unwritten, insured or self-insured) maintained or contributed to (or with respect to which any obligation to contribute has been undertaken) by the Companies on behalf of any employee or other service provider of the Companies (whether current, former, or retired) or their beneficiaries or with respect to which the Companies have any obligation or liability (contingent or otherwise) (each “Benefit Plan”). With respect to each Benefit Plan, Sellers has delivered to Purchaser (1) current, accurate and complete copies of each such Benefit Plan and all contracts relating thereto (including without limitation all trust agreements, insurance or annuity contracts, investment management agreements, record keeping agreements and other material documents or instruments relating thereto), and in the case of any Benefit Plan that is not in written form, an accurate description of all material aspects of that Benefit Plan; (2) copies of the most recent Internal Revenue Service determination letter (including copies of any outstanding requests for determination letters) or opinion letter with respect to each such Benefit Plan which is an “employee pension benefit plan” (within the meaning of Section 3(2) of ERISA) intended to qualify under Section 401(a) of the IRC; and (3) copies of the most recent Forms 5500 annual report and accompanying schedules, and the most recent summary plan descriptions.

(b)           Except as set forth on Schedule 3.9(b) , all Benefit Plans are fully funded and administered in accordance with Applicable Law, and comply in form and in operation in all material respects with the requirements of Applicable Law.

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(c)           Each Benefit Plan has been maintained, funded and administered in accordance with the terms of such Benefit Plan and complies in form and in operation in all material respects with the requirements of Applicable Law, including ERISA and the IRC.

(d)           All contributions (including employer contributions and employee salary reduction contributions) that are due have been made to each Benefit Plan that is an “employee pension benefit plan” (within the meaning of Section 3(2) of ERISA). All premiums or other payments that are due have been paid with respect to each such Benefit Plan that is an “employee welfare benefit plan” (within the meaning of Section 3(1) of ERISA).

(e)           Each Benefit Plan that is intended to meet the requirements of a “qualified plan” under Section 401(a) of the IRC has received a determination letter from the IRS to the effect that it meets the requirements of Section 401(a) of the IRC.

(f)            Neither the Companies or any of their predecessors has ever contributed to, contributes to, has ever been required to contribute to, or otherwise participated in or maintains sponsors or in any way, directly or indirectly, has any liability with respect to any plan subject to Section 412 of the IRC, Section 302 of ERISA or Title IV of ERISA, including, without limitation, any employee pension benefit plan that is a “defined benefit plan” (as defined in ERISA §3(35), any “multiemployer plan” (within the meaning of Sections 3(37) or 4001(a)(3) of ERISA or Section 414(f) of the IRC) or any single employer pension plan (within the meaning of Section 4001(a)(15) of ERISA) which is subject to Sections 4063, 4064 or 4069 of ERISA.

(g)           No non-exempt “prohibited transaction,” within the meaning of Section 4975 of the IRC and Section 406 of ERISA, has occurred or is reasonably expected to occur with respect to the Employee Benefit Plans.

(h)           No Benefit Plan is under, and neither Sellers nor the Companies have received any notice of, an audit or investigation by the IRS, Department of Labor or any other Governmental Body and no such completed audit, if any, has resulted in the imposition of any tax or penalty.

(i)            The Companies have no unfunded liabilities pursuant to any Benefit Plan that is not intended to be qualified under Section 401(a) of the IRC and is an employee pension benefit plan within the meaning of Section 3(2) of ERISA, a nonqualified deferred compensation plan or an excess benefit plan. Schedule 3.9(i) of the Disclosure Schedule sets forth a true, correct and complete list of each Benefit Plan which is a nonqualified deferred compensation plan. Each such nonqualified compensation plan, whether deferred or otherwise, is not subject to IRC 409A.

(j)            The consummation of the contemplated transactions alone, or in combination with a termination of any employee, officer, director, or other service provider or shareholder of the Companies (whether current, former or retired): (i) will not give rise to any liability under any Benefit Plan, including, without limitation, liability for severance pay, unemployment compensation, termination pay or withdrawal liability, or accelerate the time of payment or vesting or increase the amount of compensation or benefits due to any employee, officer, director, other service provider or shareholder of the Companies (whether current, former or retired) or their beneficiaries; and (ii) will not cause any Benefit Plan or contract of insurance or

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other ancillary agreement to become void or voidable or cause any increase in cost, other than cost increases or decreases attributable to annual renewal. No amount that can be received (whether in cash or property or the vesting of property), as a result of the consummation of the contemplated transactions, by any employee, shareholder or other service provider of the Companies who is a “disqualified individual” (as such term is defined in Treas. Reg. §1.280G–1) under any Benefit Plan or otherwise can be characterized as an “excess parachute payment” (as defined in Sections 280G(b)(1) and 280G(b)(5) of the IRC).

(k)           Any individual who performs services for the Companies and who is not treated as an employee for federal income tax purposes by the Companies is not an employee under applicable law or for any purpose including, without limitation, for tax withholding purposes or employee Benefit Plan purposes.

(l)            WARN Compliance. The Companies have complied in all respects with the Worker Adjustment and Retraining Notification Act, 29 U.S.C. § 2101 et seq., and its corresponding regulations, and Tennessee Code Annotated § 50-1-601 et seq., and its corresponding regulations, in each case