AMENDED AND RESTATED STOCK PURCHASE AGREEMENT BETWEEN NUVERRA ENVIRONMENTAL SOLUTIONS, INC. AND VEROLUBE USA, INC. DATED AS OF June 24, 2014

Exhibit 2.1

Execution Version

AMENDED AND RESTATED

STOCK PURCHASE AGREEMENT

BETWEEN

NUVERRA ENVIRONMENTAL SOLUTIONS, INC.

AND

VEROLUBE USA, INC.

DATED AS OF

June 24, 2014

TABLE OF CONTENTS


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TABLE OF CONTENTS

ARTICLE I. DEFINITIONS		1

ARTICLE II. PURCHASE AND SALE		11

Section 2.01. Purchase and Sale		11
Section 2.02. Purchase Price		11
Section 2.03. Transactions to be Effected at the Closing		11
Section 2.04. Cash Consideration Adjustment		12
Section 2.05. Escrow Agreement		14
Section 2.06. Closing		15
Section 2.07. Excluded Accounts Receivables		15

ARTICLE III. REPRESENTATIONS AND WARRANTIES OF SELLER		15

Section 3.01. Organization and Authority of Seller		15
Section 3.02. Organization, Authority and Qualification of Xxxxxxxx and the Company		16
Section 3.03. Capitalization		16
Section 3.04. Subsidiaries		17
Section 3.05. No Conflicts; Consents		17
Section 3.06. Financial Statements		17
Section 3.07. Undisclosed Liabilities		19
Section 3.08. Absence of Certain Changes, Events and Conditions		19
Section 3.09. Material Contracts		21
Section 3.10. Title to Assets; Real Property		23
Section 3.11. Condition And Sufficiency of Assets		24
Section 3.12. Intellectual Property		24
Section 3.13. Inventory		25
Section 3.14. Accounts Receivable		26
Section 3.15. Customers and Suppliers		26
Section 3.16. Insurance		26
Section 3.17. Legal Proceedings; Governmental Orders		27
Section 3.18. Compliance With Laws; Permits		28
Section 3.19. Environmental Matters		28
Section 3.20. Employee Benefit Matters		29
Section 3.21. Employment Matters		32
Section 3.22. Taxes		33
Section 3.23. Books and Records		35

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TABLE OF CONTENTS

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	Page
Section 3.24. Brokers		36
Section 3.25. Investment Purpose		36
Section 3.26. No Other Representations and Warranties		36
Section 3.27. Xxxxxxxx’x Status as a Holding Company		36

ARTICLE IV. REPRESENTATIONS AND WARRANTIES OF BUYER		36

Section 4.01. Organization and Authority of Buyer		37
Section 4.02. No Conflicts; Consents		37
Section 4.03. Investment Purpose		37
Section 4.04. Brokers		38
Section 4.05. Legal Proceedings		38
Section 4.06. Independent Investigation		38
Section 4.07. Parent Shares		38

ARTICLE V. COVENANTS		38

Section 5.01. Conduct of Business Prior to the Closing		38
Section 5.02. Access to Information		39
Section 5.03. Supplement to Disclosure Schedules		40
Section 5.04. Resignations		40
Section 5.05. Employees; Benefit Plans		40
Section 5.06. Plant Closings and Mass Layoffs		41
Section 5.07. Director and Officer Indemnification and Insurance		41
Section 5.08. Financing Process Assistance		43
Section 5.09. No Solicitation of Other Bids		43
Section 5.10. Notice of Certain Events		44
Section 5.11. Confidentiality		45
Section 5.12. Non-competition; Non-solicitation		45
Section 5.13. Governmental Approvals and Consents		46
Section 5.14. Books and Records		47
Section 5.15. Closing Conditions		48
Section 5.16. Public Announcements		48
Section 5.17. Further Assurances		48
Section 5.18. Guarantees		49
Section 5.19. Payment of Bonds		49
Section 5.20. Leased Vehicles		49

ARTICLE VI. TAX MATTERS		50

Section 6.01. Tax Covenants		50

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TABLE OF CONTENTS

(continued)


	Page
Section 6.02. Termination of Existing Tax Sharing Agreements		51
Section 6.03. Tax Indemnification		51
Section 6.04. Straddle Period		52
Section 6.05. Contests		52
Section 6.06. Tax Refunds		53
Section 6.07. Cooperation and Exchange of Information		53
Section 6.08. Tax Treatment of Indemnification Payments		53
Section 6.09. Survival		54
Section 6.10. Overlap		54

ARTICLE VII. CONDITIONS TO CLOSING		54

Section 7.01. Conditions to Obligations of All Parties		54
Section 7.02. Conditions to Obligations of Buyer		54
Section 7.03. Conditions to Obligations of Seller		56

ARTICLE VIII. INDEMNIFICATION		57

Section 8.01. Survival		57
Section 8.02. Indemnification By Seller		58
Section 8.03. Indemnification By Buyer		58
Section 8.04. Certain Limitations		59
Section 8.05. Indemnification Procedures		60
Section 8.06. Payments		62
Section 8.07. Tax Treatment of Indemnification Payments		62
Section 8.08. Exclusive Remedies		63

ARTICLE IX. TERMINATION		63

Section 9.01. Termination		63
Section 9.02. Effect of Termination		64
Section 9.03. Termination Payment		64

ARTICLE X. MISCELLANEOUS		65

Section 10.01. Expenses		65
Section 10.02. Notices		65
Section 10.03. Interpretation		67
Section 10.04. Headings		67
Section 10.05. Severability		67
Section 10.06. Entire Agreement		67
Section 10.07. Successors and Assigns		68

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Section 10.08. No Third-party Beneficiaries		68
Section 10.09. Amendment and Modification; Waiver		68
Section 10.10. Governing Law; Submission to Jurisdiction; Waiver of Jury Trial		68
Section 10.11. Specific Performance		69
Section 10.12. Counterparts		69
Section 10.13. Non-recourse		69
Section 10.14. Express Agreement to Create a Sealed Instrument		70

Exhibits:

Exhibit A: Amended and Restated Form of Escrow Agreement

Exhibit B: Indebtedness to be paid at Closing

Exhibit C: Format for Calculation of Estimated Closing Working Capital

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AMENDED AND RESTATED STOCK PURCHASE AGREEMENT

This Amended and Restated Stock Purchase Agreement (this “Agreement”), dated as of June 24, 2014, is entered into between Nuverra Environmental Solutions, Inc., a Delaware corporation (“Seller”), and VeroLube USA, Inc., a Texas corporation (“Buyer”), and amends and replaces in its entirety that certain Stock Purchase Agreement dated as of March 10, 2014, by and between Seller and Buyer (the “Original Purchase Agreement”), as amended by that certain First Amendment to Stock Purchase Agreement dated as of April 7, 2014, by and between Seller and Buyer (the “First Amendment”).

RECITALS

WHEREAS, Seller owns all of the issued and outstanding shares of common stock, par value $0.01 per share (the “Shares”), of Xxxxxxxx Environmental Services, Inc., a Delaware corporation (“Xxxxxxxx”); and

WHEREAS, Xxxxxxxx is a holding company that owns all of the issued and outstanding shares of common stock, par value $0.01 per share (the “Company Shares”), of Thermo Fluids, Inc., a Delaware corporation (the “Company”); and

WHEREAS, Seller wishes to sell to Buyer, and Buyer wishes to purchase from Seller, the Shares, subject to the terms and conditions set forth herein; and

WHEREAS, at the time of the execution of the Original Purchase Agreement, Seller mistakenly did not disclose to Buyer that Seller did not directly own the Company Shares, but rather that the Company Shares were owned by Seller’s wholly-owned subsidiary, Xxxxxxxx. Seller has represented and warranted to Buyer that Xxxxxxxx is a holding company which (except for the ownership of the Company Shares), does not have, and has never had, any assets or liabilities. In order to correctly document the transaction, the parties hereto desire to amend and restate the Original Purchase Agreement and the First Amendment as provided herein; and

WHEREAS, the parties intend to create a contract under seal;

NOW, THEREFORE, in consideration of the mutual covenants and agreements hereinafter set forth and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

ARTICLE I.

Definitions

The following terms have the meanings specified or referred to in this ARTICLE I:

“Accounting Referee” has the meaning set forth in Section 6.01(d).

“Acquisition Proposal” has the meaning set forth in Section 5.09(a).

“Action” means any claim, action, cause of action, demand, lawsuit, arbitration, notice of violation, proceeding, litigation, citation, summons, subpoena, or investigation of any nature, civil, criminal or administrative, whether at law or in equity.

“Actual Closing Cash” has the meaning set forth in Section 2.04(a)(i).

“Affiliate” of a Person means any other Person that directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with, such Person. The term “control” (including the terms “controlled by” and “under common control with”) means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities, by contract or otherwise.

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

“Annual Financial Statements” has the meaning set forth in Section 3.05.

“Balance Sheet” has the meaning set forth in Section 3.05.

“Balance Sheet Date” has the meaning set forth in Section 3.05.

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

“Benefit Plan” has the meaning set forth in Section 3.20(a).

“Business Day” means any day except Saturday, Sunday or any other day on which commercial banks located in New York, New York are authorized or required by Law to be closed for business.

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

“Buyer Benefit Plans” has the meaning set forth in Section 5.05(b).

“Buyer Indemnitees” has the meaning set forth in Section 8.02.

“Buyer’s Accountants” means Whitley Penn.

“Buyer’s Tax Contest” has the meaning set forth in Section 6.05.

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

“Cash Consideration” has the meaning set forth in Section 2.02.

“CERCLA” means the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, as amended by the Superfund Amendments and Reauthorization Act of 1986, 42 U.S.C. §§ 9601 et seq.

“Closing” has the meaning set forth in Section 2.06.

“Closing Adjustment” has the meaning set forth in Section 2.04(a)(ii).

“Closing Cash Deficiency” has the meaning set forth in Section 2.04(a)(i).

“Closing Date” has the meaning set forth in Section 2.06.

“Closing Working Capital” means: (a) the Current Assets of Xxxxxxxx and the Company, less (b) the Current Liabilities of Xxxxxxxx and the Company, determined as of the open of business on the Closing Date.

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

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

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

“Company Continuing Employee” has the meaning set forth in Section 5.05(a).

“Company Intellectual Property” has the meaning set forth in Section 3.12(a).

“Company Shares” has the meaning set forth in the recitals.

“Confidentiality Agreement” means the Confidentiality Agreement, dated as of November 13, 2013, between Buyer and Seller.

“Contracts” means all contracts, leases, deeds, mortgages, licenses, instruments, notes, commitments, undertakings, indentures, joint ventures and all other agreements, commitments and legally binding arrangements, whether written or oral.

“Current Assets” means cash and cash equivalents, accounts receivable, inventory and prepaid expenses, but excluding (a) the portion of any prepaid expense of which Buyer will not receive the benefit following the Closing, (b) deferred Tax assets, (c) receivables from any of Xxxxxxxx’x or the Company’s Affiliates, directors, employees, officers or stockholders and any of their respective Affiliates, and (d) the Excluded Accounts Receivables, determined in accordance with Exhibit C and GAAP applied using the same accounting methods, practices, principles, policies and procedures, with consistent classifications, judgments and valuation and estimation methodologies that were used in the preparation of the Annual Financial Statements for the most recent fiscal year end as if such accounts were being prepared and audited as of a fiscal year end.

“Current Liabilities” means accounts payable, accrued Taxes, and accrued expenses, but excluding payables to any of Xxxxxxxx’x or the Company’s Affiliates, directors, employees, officers or stockholders and any of their respective Affiliates, deferred Tax liabilities and the current portion of long term debt, determined in accordance with Exhibit C and GAAP applied using the same accounting methods, practices, principles, policies and procedures, with consistent classifications, judgments and valuation and estimation methodologies that were used in the preparation of the Annual Financial Statements for the most recent fiscal year end as if such accounts were being prepared and audited as of a fiscal year end.

“D&O Costs” has the meaning set forth in Section 5.07(b).

“D&O Expenses” has the meaning set forth in Section 5.07(b).

“D&O Indemnifiable Claim” has the meaning set forth in Section 5.07(b).

“D&O Indemnified Person” has the meaning set forth in Section 5.07(a).

“D&O Indemnifying Party” has the meaning set forth in Section 5.07(b).

“Data Room” means the electronic documentation site established by IntraLinks, Inc. on behalf of Seller containing the documents set forth in the index included in Section 1.01(a) of the Disclosure Schedules.

“Direct Claim” has the meaning set forth in Section 8.05(c).

“Disclosure Schedules” means the Disclosure Schedules delivered by Seller and Buyer upon the execution and delivery of the Original Purchase Agreement.

“Disputed Amounts” has the meaning set forth in Section 2.04(c)(iii).

“Dollars” or “$” means the lawful currency of the United States.

“Draft Financial Statements” has the meaning set forth in Section 3.05.

“Drop Dead Date” means August 29, 2014, or such later date as the parties may agree.

“Employee” means an individual employed by the Company immediately prior to the Closing.

“Encumbrance” means any charge, claim, pledge, lien (statutory or other), option, security interest, mortgage, easement, encroachment, right of way, right of first refusal, or other encumbrance of any kind or nature.

“Environmental Claim” means any Action, Governmental Order, lien, fine, penalty, or, as to each, any settlement or judgment arising therefrom, by or from any Person alleging liability (including liability or responsibility for the costs of enforcement proceedings, investigations, cleanup, governmental response, removal or remediation, natural resources damages, property damages, personal injuries, medical monitoring, penalties, contribution, indemnification and injunctive relief) arising out of, based on or resulting from: (a) the presence, Release of, or exposure to, any Hazardous Materials; or (b) any actual or alleged non-compliance with any Environmental Law or term or condition of any Environmental Permit.

“Environmental Law” means any applicable Law, and any Governmental Order or binding agreement with any Governmental Authority: (a) relating to pollution (or the cleanup thereof) or the protection of natural resources, endangered or threatened species, human health or safety, or the environment (including ambient air, soil, surface water or groundwater, or subsurface strata); or (b) concerning the presence of, exposure to, or the management, manufacture, use, containment, storage, recycling, reclamation, reuse, treatment, generation, discharge, transportation, processing, production, disposal or remediation of any Hazardous Materials. The term “Environmental Law” includes the following (including their implementing regulations and any state analogs): CERCLA; the Solid Waste Disposal Act, as amended by the Resource Conservation and Recovery Act of 1976, as amended by the Hazardous and Solid Waste Amendments of 1984, 42 U.S.C. §§ 6901 et seq.; the Federal Water Pollution Control Act of 1972, as amended by the Clean Water Act of 1977, 33 U.S.C. §§ 1251 et seq.; the Toxic Substances Control Act of 1976, as amended, 15 U.S.C. §§ 2601 et seq.; the Emergency Planning and Community Right-to-Know Act of 1986, 42 U.S.C. §§ 11001 et seq.; the Clean Air Act of 1966, as amended by the Clean Air Act Amendments of 1990, 42 U.S.C. §§ 7401 et seq.; and the Occupational Safety and Health Act of 1970, as amended, 29 U.S.C. §§ 651 et seq.

“Environmental Notice” means any notice respecting any Environmental Claim or relating to actual or alleged non-compliance with or liability under any Environmental Law, or relating to actual or alleged non-compliance with any term or condition of any Environmental Permit.

“Environmental Permit” means any Permit required under or issued, granted, given, authorized by or made by a Governmental Authority pursuant to Environmental Law.

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

“ERISA Affiliate” means, with respect to any Person, any other Person that, together with such first Person, would be treated as a single employer within the meaning of Section 414(b), (c), (m) or (o) of the Code.

“Escrow Agent” has the meaning set forth in Section 2.05.

“Escrow Agreement” has the meaning set forth in Section 2.03(a)(i) and has been amended and restated from the form of escrow agreement attached as an exhibit to the Original Agreement.

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

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

“Excluded Accounts Receivables” means (a) any accounts receivable relating to the matters disclosed in Schedule 3.17 of the Disclosure Schedules, including the receivable related to the United States Air Force, which is described on the Company’s Consolidated Balance Sheet dated December 31, 2013, as “Other Receivable – Denver PCB Incident”, and (b) all accounts receivable owing by (i) Omega Refining, LLC that relate to invoices which, as of the Closing Date, have not been paid in full within ten (10) days from the date of such invoices and (ii) Bango Refining NV, LLC that relate to invoices which, as of the Closing Date, have not been paid in full within thirty (30) days from the date of such invoices.

“Filing Statement” has the meaning set forth in Section 3.05 Section 5.08(b).

“Financial Statements” has the meaning set forth in Section 3.05.

“Financing” has the meaning set forth in Section 5.08.

“First Amendment” has the meaning set forth in the preamble.

“First Party” has the meaning set forth in Section 6.05.

“First Schedule Supplement” has the meaning set forth in Section 5.03(a).

“GAAP” means United States generally accepted accounting principles in effect from time to time.

“Governmental Authority” means any federal, state, local or foreign government or political subdivision thereof, or any agency or instrumentality of such government or political

subdivision, or any self-regulated organization or other non-governmental regulatory authority or quasi-governmental authority (to the extent that the rules, regulations or orders of such organization or authority have the force of Law), or any arbitrator, court or tribunal of competent jurisdiction.

“Governmental Order” means any order, writ, judgment, injunction, decree, stipulation, determination or award entered by or with any Governmental Authority.

“Hazardous Materials” means: any material, substance or waste that is hazardous, acutely hazardous, toxic, or words of similar import or regulatory effect or otherwise regulated by or subject to liability under Environmental Laws, including any petroleum or petroleum-derived products, radon, radioactive materials or wastes, asbestos in any form, lead or lead-containing materials, urea formaldehyde foam insulation, and polychlorinated biphenyls.

“Xxxxxxxx” has the meaning set forth in the recitals.

“Holdback Escrow Fund” has the meaning set forth in Section 2.03(a)(i).

“Holdback Matters” has the meaning set forth in Section 2.05.

“IFRS” means International Financial Reporting Standards in effect from time to time.

“Indebtedness” means, with respect to Xxxxxxxx or the Company, without duplication, all Liabilities or obligations of Xxxxxxxx or the Company: (i) for borrowed money (principal and interest); (ii) evidenced by bonds, debentures, notes or other similar instruments or under swaps, xxxxxx or similar instruments (other than commodity xxxxxx entered into in the ordinary course of business); (iii) under letters of credit; (iv) created or arising under any conditional sale or other title retention agreement with respect to acquired property; (v) under any capitalized leases; (vi) secured by an Encumbrance (other than Permitted Encumbrances) on any of Xxxxxxxx’x or the Company’s assets; (vii) for employee pension benefit and deferred compensation plans as of the Closing; (viii) for accrued but unpaid interest and unpaid prepayment penalties or premiums that are payable in connection with retirement or prepayment in respect of any of the foregoing; and (ix) for guarantees of another Person in respect of any of the foregoing. Notwithstanding anything to the contrary contained herein, “Indebtedness” does not include (1) any earn-out, deferred purchase price or similar obligations, or (2) operating leases.

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

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

“Independent Accountants” has the meaning set forth in Section 2.04(c)(iii).

“Insurance Policies” has the meaning set forth in Section 3.16.

“Intellectual Property” has the meaning set forth in Section 3.12(a).

“Intellectual Property Registrations” has the meaning set forth in Section 3.12(b).

“Interim Balance Sheet” has the meaning set forth in Section 3.05.

“Interim Balance Sheet Date” has the meaning set forth in Section 3.05.

“Interim Financial Statements” has the meaning set forth in Section 3.05.

“Interim Guaranteed Bonds” has the meaning set forth in Section 5.18(a).

“Interim Period” has the meaning set forth in Section 5.18(a).

“Interim Vehicle Lease” has the meaning set forth in Section 5.20.

“June 2014 Interim Financial Statements” has the meaning set forth in Section 3.05.

“Knowledge of Seller” or “Seller’s Knowledge” or any other similar knowledge qualification, means the actual knowledge of Xxxx Xxxxxx, Xxxxx Xxxxxxx, Xxxx Xxxxxxxx, Xxx Xxxxxxxxx or Xxx Xxxxxxxx, after reasonable inquiry, of the relevant subject matter or on the basis of such knowledge of the relevant subject matter as such person or persons would have had if he or they had conducted such reasonable inquiry.

“Law” means any statute, law, ordinance, regulation, rule, code, order, constitution, treaty, common law, judgment, decree, other requirement or rule of law of any Governmental Authority.

“Liabilities” has the meaning set forth in Section 3.07.

“Licensed Intellectual Property” has the meaning set forth in Section 3.12(a).

“Listed Indemnification Agreements” has the meaning set forth in Section 5.18(a).

“Listed Permanent Bonds” has the meaning set forth in Section 5.18(b).

“Losses” means losses, damages, liabilities, deficiencies, Actions, judgments, interest, awards, penalties, fines, costs or expenses of whatever kind, including reasonable attorneys’ fees and the cost of enforcing any right to indemnification hereunder and the cost of pursuing any insurance providers; provided, however, that “Losses” shall not include punitive damages, except in the case of fraud or to the extent actually awarded to a Governmental Authority or other third party.

“March 2014 Interim Financial Statements” has the meaning set forth in Section 3.05.

“Material Adverse Effect” means any event, occurrence, fact, condition or change that is, or could reasonably be expected to become, individually or in the aggregate, materially adverse to (a) the business, results of operations, financial condition, or assets of Xxxxxxxx or the Company, or (b) the ability of Seller to consummate the transactions contemplated hereby on a timely basis; provided, however, that “Material Adverse Effect” shall not include any event, occurrence, fact, condition or change, directly or indirectly, arising out of or attributable to: (i) general economic or political conditions; (ii) conditions generally affecting the industries in which the Company operates; (iii) any changes in financial, banking or securities markets in general, including any disruption thereof and any decline in the price of any security or any market index or any change in prevailing interest rates; (iv) acts of war (whether or not declared), armed hostilities or terrorism, or the escalation or worsening thereof; (v) any action required or permitted by this Agreement (other than as contemplated under Section 5.03) or any action taken (or omitted to be taken) with the written consent of or at the written request of Buyer; (vi) any matter of which Buyer was aware on Xxxxx 00, 0000 (xx being acknowledged

that Buyer shall not be deemed to be aware of any matter solely by reason of information relating to the matter being available in the Data Room); (vii) any changes in applicable Laws or accounting rules (including GAAP); (viii) the announcement, pendency or completion of the transactions contemplated by this Agreement, including losses or threatened losses of employees, customers, suppliers, distributors or others having relationships with the Company; (ix) any natural or man-made disaster or acts of God; (x) seasonality in Seller’s business or industry; (xi) the identity, action or inaction of Buyer; (xii) any such matter that Seller cures or is otherwise remedied prior to the applicable measurement date; or (xiii) any failure by the Company to meet any internal or published projections, forecasts or revenue or earnings predictions (provided that the underlying causes of such failures (subject to the other provisions of this definition) shall not be excluded).

“Material Contracts” has the meaning set forth in Section 3.09(a).

“Material Customers” has the meaning set forth in Section 3.15(a).

“Material Suppliers” has the meaning set forth in Section 3.15(b).

“Multiemployer Plan” has the meaning set forth in Section 3.20(c).

“Parent” has the meaning set forth in Section 2.02.

“Parent Shares” has the meaning set forth in Section 2.02.

“Permits” means all permits, licenses, franchises, approvals, authorizations and consents required to be obtained from Governmental Authorities.

“Permitted Encumbrances” has the meaning set forth in Section 3.10(a).

“Person” means an individual, corporation, partnership, joint venture, limited liability company, Governmental Authority, unincorporated organization, trust, association or other entity.

“Post-Closing Adjustment” has the meaning set forth in Section 2.04(b)(ii).

“Post-Closing Straddle Period” has the meaning set forth in Section 6.04.

“Post-Closing Tax Period” means any taxable period that begins the day after the Closing Date.

“Post-Closing Taxes” means, collectively, Taxes of Xxxxxxxx and the Company attributable to a Post-Closing Tax Period and Taxes that are allocable to a Post-Closing Straddle Period pursuant to Section 6.04.

“Pre-Closing Period Returns” has the meaning set forth in Section 6.01(d).

“Pre-Closing Straddle Period” has the meaning set forth in Section 6.04.

“Pre-Closing Tax Period” means any taxable period that ends on or prior to the Closing Date.

“Pre-Closing Taxes” means, collectively, Taxes of Xxxxxxxx and the Company attributable to a Pre-Closing Tax Period and Taxes that are allocable to a Pre-Closing Straddle Period pursuant to Section 6.04.

“Purchase Price” has the meaning set forth in Section 2.02.

“Qualified Benefit Plan” has the meaning set forth in Section 3.20(c).

“Real Property” means the real property owned, leased or subleased or otherwise operated by the Company, together with all buildings, structures and facilities located thereon.

“Release” means any actual or threatened release, spilling, leaking, pumping, pouring, emitting, emptying, discharging, injecting, escaping, leaching, dumping, abandonment, disposing or allowing to escape or migrate into or through the environment (including ambient air (indoor or outdoor), surface water, groundwater, land surface or subsurface strata or within any building, structure, facility or fixture).

“Representative” means, with respect to any Person, any and all directors, officers, employees and agents of such Person.

“Required Closing Cash” has the meaning set forth in Section 2.04(a)(i).

“Required Consent” means any consent, approval, waiver or acknowledgement from any Person (other than Xxxxxxxx, the Company, Seller or their Affiliates) which is provided for or required in respect of or pursuant to the terms of any material Contract to which the Company is bound in connection with the sale of the Shares to Buyer on the terms contemplated in this Agreement, to permit the Company to carry on its business after the Closing Date or which is otherwise necessary to permit the parties to perform their obligations under this Agreement.

“Resolution Period” has the meaning set forth in Section 2.04(c)(ii).

“Restricted Business” means the transportation, recycling and refining of used motor oils, motor oil filters or engine coolants.

“Restricted Period” has the meaning set forth in Section 5.12(a).

“Review Period” has the meaning set forth in Section 2.04(c)(i).

“Schedule Supplement” has the meaning set forth in Section 5.03(a).

“Second Party” has the meaning set forth in Section 6.05.

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

“Seller Indemnitees” has the meaning set forth in Section 8.03.

“Seller’s Accountants” means Pricewaterhouse Coopers.

“Seller’s Tax Contest” has the meaning set forth in Section 6.05.

“Shares” has the meaning set forth in the recitals.

“Statement of Objections” has the meaning set forth in Section 2.04(c)(ii).

“Stock Consideration” has the meaning set forth in Section 2.02.

“Straddle Period” has the meaning set forth in Section 6.04.

“Straddle Period Returns” means the Tax Returns that are required to be filed for any Straddle Period.

“Tail Policy” has the meaning set forth in Section 5.07(c).

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

“Tax Claim” has the meaning set forth in Section 6.05.

“Tax Return” means any return, declaration, report, claim for refund, information return or statement or other document relating to Taxes, including any schedule or attachment thereto, and including any amendment thereof.

“Taxes” means all federal, state, local, foreign and other income, gross receipts, sales, use, production, ad valorem, transfer, franchise, registration, profits, license, lease, service, service use, withholding, payroll, employment, unemployment, estimated, excise, severance, environmental, stamp, occupation, premium, property (real or personal), real property gains, windfall profits, customs, duties or other taxes, fees, assessments or charges of any kind whatsoever, together with any interest, additions or penalties with respect thereto and any interest in respect of such additions or penalties.

“Territory” means the United States, Canada and Mexico.

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

“Transaction Documents” means this Agreement and the Escrow Agreement.

“Undisputed Amounts” has the meaning set forth in Section 2.04(c)(iii).

“Union” has the meaning set forth in Section 3.21(b).

“Unlisted Indemnification Agreements” has the meaning set forth in Section 5.18(c).

“WARN Act” means the federal Worker Adjustment and Retraining Notification Act of 1988, and similar state, local and foreign laws related to plant closings, relocations, mass layoffs and employment losses.

“Xxxxx Cross Utah” means the former facility of the Company located at the location described as “Xxxxx Cross Utah” in Section 3.19 of the Disclosure Schedules.

“Xxxxx Cross Utah Bonds” has the meaning set forth in Section 3.09(a).

“Xxxxx Cross Utah Losses” means any and all Losses incurred or sustained by, or imposed upon, any of the Buyer Indemnitees based upon, arising out of, with respect to or by reason of the Company’s occupation, use or control of Xxxxx Cross Utah, including all Losses for adherence to any Law required in connection with Xxxxx Cross Utah including costs and expenses reasonably incurred to maintain or replace any surety bond (including the current Surety Bond No. 800008676) required by the Utah Department of Environmental Quality.

ARTICLE II.

Purchase and Sale

Section 2.01. Purchase and Sale. Subject to the terms and conditions set forth herein, at the Closing, Seller shall sell to Buyer, and Buyer shall purchase from Seller, the Shares, free and clear of all Encumbrances, for the consideration specified in Section 2.02.

Section 2.02. Purchase Price. The aggregate purchase price for the Shares shall be ONE HUNDRED AND SEVENTY-FIVE MILLION DOLLARS ($175,000,000) consisting of (a) ONE HUNDRED AND SIXTY-FIVE MILLION DOLLARS ($165,000,000) in cash minus the outstanding amount of Indebtedness of Xxxxxxxx and the Company as of the Closing (payable by Buyer pursuant to Section 2.03(c) below), subject to adjustment pursuant to Section 2.04 hereof (in the aggregate the “Cash Consideration”) and (b) that number of Class A Common Shares (“Parent Shares”) of VeroLube Inc., a corporation organized under the Canada Business Corporations Act (“Parent”), equal to TEN MILLION DOLLARS ($10,000,000) divided by the price at which Parent Shares are sold in a private placement being conducted by Parent to raise capital for the transactions contemplated herein (the “Stock Consideration” and together with the Cash Consideration, the “Purchase Price”).

Section 2.03. Transactions to be Effected at the Closing.

(a) At the Closing, Buyer shall deliver to Seller:

(i) The Cash Consideration, subject to any Closing Adjustment pursuant to Section 2.04(a), by wire transfer of immediately available funds to an account of Seller designated in writing by Seller to Buyer no later than five (5) Business Days prior to the Closing Date minus Seventeen Million Five Hundred Thousand Dollars ($17,500,000) (the “Holdback Escrow Fund”). The Holdback Escrow Fund shall be held in escrow pursuant to Section 2.05 of this Agreement and the terms and conditions of an escrow agreement substantially in the form attached hereto as Exhibit A (the “Escrow Agreement”);

(ii) stock certificates evidencing the Stock Consideration; and

(iii) the Transaction Documents and all other agreements, documents, instruments or certificates required to be delivered by Buyer at or prior to the Closing pursuant to Section 7.03 of this Agreement.

(b) At the Closing, Seller shall deliver to Buyer:

(i) stock certificates evidencing the Shares, free and clear of all Encumbrances, duly endorsed in blank or accompanied by stock powers or other instruments of transfer duly executed in blank in form and substance reasonably satisfactory to Buyer, with all required stock transfer tax stamps affixed thereto;

(ii) the Closing Cash Deficiency (as provided in Section 2.04(a) below), if any, by wire transfer of immediately available funds to an account designated by Buyer no later than two (2) Business Days prior to the Closing Date; and

(iii) the Transaction Documents and all other agreements, documents, instruments or certificates required to be delivered by Seller at or prior to the Closing pursuant to Section 7.02 of this Agreement.

(c) Except for the Indebtedness identified in Exhibit B attached hereto, for which payoff letters will be delivered to Buyer pursuant to Section 7.02(l) below, as of the Closing, Seller shall cause Xxxxxxxx and the Company to have no Indebtedness. At the Closing, Buyer shall pay or cause to be paid, on behalf of Xxxxxxxx and the Company, the amounts of Indebtedness indicated pursuant to Section 7.02(l) by wire transfer of immediately available funds to the Persons or bank accounts specified in such payoff letters.

Section 2.04. Cash Consideration Adjustment.

(a) Closing Adjustment.

(i) At least three (3) Business Days before the Closing, Seller shall prepare and deliver to Buyer a statement setting forth its good faith estimate of Closing Working Capital (the “Estimated Closing Working Capital”), which statement shall contain an estimated consolidated balance sheet of Xxxxxxxx and the Company as of the Closing Date (without giving effect to the transactions contemplated herein) and a separate statement of the amount of cash in Xxxxxxxx’x and the Company’s bank accounts as of the Closing Date and a description of the dollar amount of each such account (the “Actual Closing Cash”), a calculation of Estimated Closing Working Capital (the “Estimated Closing Working Capital Statement”), and a certificate of the Chief Financial Officer of Seller that the Estimated Closing Working Capital Statement was prepared in accordance with Exhibit C and GAAP applied using the same accounting methods, practices, principles, policies and procedures, with consistent classifications, judgments and valuation and estimation methodologies that were used in the preparation of the Annual Financial Statements for the most recent fiscal year end as if such Estimated Closing Working Capital Statement was being prepared and audited as of a fiscal year end. The Actual Closing Cash shall include cash held in Xxxxxxxx’x and the Company’s bank accounts of at least $650,000 (“Required Closing Cash”) (and which, for great certainty and without duplication, shall be included in the Closing Working Capital). If the Actual Closing Cash is less than the Required Closing Cash at Closing then Seller shall pay to Buyer at Closing an amount equal to the difference between the Required Closing Cash and the Actual Closing Cash (the “Closing Cash Deficiency”).

(ii) The “Closing Adjustment” shall be an amount equal to the Estimated Closing Working Capital minus $9,850,000 (the “Target Working Capital”). If the Closing Adjustment is a positive number, the Cash Consideration shall be increased by the amount of the Closing Adjustment. If the Closing Adjustment is a negative number, the Cash Consideration shall be reduced by the amount of the Closing Adjustment.

(b) Post-Closing Adjustment.

(i) Within sixty (60) days after the Closing Date, Buyer shall prepare and deliver to Seller a statement setting forth its calculation of Closing Working Capital (without giving effect to the transactions contemplated herein), a calculation of Closing Working Capital

(the “Closing Working Capital Statement”) and a certificate of the Chief Financial Officer of Buyer that the Closing Working Capital Statement was prepared in accordance with Exhibit C and GAAP applied using the same accounting methods, practices, principles, policies and procedures, with consistent classifications, judgments and valuation and estimation methodologies that were used in the preparation of the Annual Financial Statements for the most recent fiscal year end as if such Closing Working Capital Statement was being prepared and audited as of a fiscal year end.

(ii) Subject to Section 2.04(c) below, the post-closing adjustment shall be an amount equal to the Closing Working Capital minus the Estimated Closing Working Capital (the “Post-Closing Adjustment”). If the Post-Closing Adjustment is a positive number, Buyer shall pay to Seller an amount equal to the Post-Closing Adjustment. If the Post-Closing Adjustment is a negative number, Seller shall pay to Buyer an amount equal to the Post-Closing Adjustment, which amount shall be paid directly by Seller and shall not be released from the Holdback Escrow Fund.

(i) Examination. After receipt of the Closing Working Capital Statement, Seller shall have thirty (30) days (the “Review Period”) to review the Closing Working Capital Statement. During the Review Period, Seller and Seller’s Accountants shall have full access to the books and records of Xxxxxxxx and the Company, the personnel of, and work papers prepared by, Buyer and/or Buyer’s Accountants to the extent that they relate to the Closing Working Capital Statement and to such historical financial information (to the extent in Buyer’s possession) relating to the Closing Working Capital Statement as Seller may reasonably request for the purpose of reviewing the Closing Working Capital Statement and to prepare a Statement of Objections (defined below), provided, that such access shall be in a manner that does not interfere with the normal business operations of Buyer, Xxxxxxxx or the Company.

(ii) Objection. On or prior to the last day of the Review Period, Seller may object to the Closing Working Capital Statement by delivering to Buyer a written statement setting forth Seller’s objections in reasonable detail, indicating each disputed item or amount and the basis for Seller’s disagreement therewith (the “Statement of Objections”). If Seller fails to deliver the Statement of Objections before the expiration of the Review Period, the Closing Working Capital Statement and the Post-Closing Adjustment, as the case may be, reflected in the Closing Working Capital Statement shall be deemed to have been accepted by Seller. If Seller delivers the Statement of Objections before the expiration of the Review Period, Buyer and Seller shall negotiate in good faith to resolve such objections within thirty (30) days after the delivery of the Statement of Objections (the “Resolution Period”), and, if the same are so resolved within the Resolution Period, the Post-Closing Adjustment and the Closing Working Capital Statement with such changes as may have been agreed in writing by Buyer and Seller, shall be final and binding.

(iii) Resolution of Disputes. If Seller and Buyer fail to reach an agreement with respect to all of the matters set forth in the Statement of Objections before expiration of the Resolution Period, then any amounts remaining in dispute (“Disputed Amounts” and any amounts not so disputed, the “Undisputed Amounts”) shall be submitted for resolution to the

office of an impartial nationally recognized firm of independent certified public accountants (other than Seller’s Accountants or Buyer’s Accountants) mutually agreed upon by Buyer and Seller (the “Independent Accountants”) who, acting as experts and not arbitrators, shall resolve the Disputed Amounts only and make any adjustments to the Post-Closing Adjustment and the Closing Working Capital Statement, as the case may be. The parties hereto agree that all adjustments shall be made without regard to materiality. The Independent Accountants shall only decide the specific items under dispute by the parties and their decision for each Disputed Amount must be within the range of values assigned to each such item in the Closing Working Capital Statement and the Statement of Objections, respectively.

(iv) Fees of the Independent Accountants. Seller shall pay a portion of the fees and expenses of the Independent Accountants equal to one hundred percent (100%) multiplied by a fraction, the numerator of which is the amount of Disputed Amounts submitted to the Independent Accountants that are resolved in favor of Buyer (that being the difference between the Independent Accountants’ determination and Seller’s determination) and the denominator of which is the total amount of Disputed Amounts submitted to the Independent Accountants (that being the sum total by which Buyer’s determination and Seller’s determination differ from the determination of the Independent Accountants). Buyer shall pay that portion of the fees and expenses of the Independent Accountants that Seller is not required to pay hereunder.

(v) Determination by Independent Accountants. The Independent Accountants shall make a determination as soon as practicable within thirty (30) days (or such other time as the parties hereto shall agree in writing) after their engagement, and their resolution of the Disputed Amounts and their adjustments to the Closing Working Capital Statement and/or the Post-Closing Adjustment shall be conclusive and binding upon the parties hereto.

(vi) Payments of Post-Closing Adjustment. Except as otherwise provided herein, any payment of the Post-Closing Adjustment, together with interest calculated as set forth below, shall (A) be due (x) within five (5) Business Days of acceptance of the applicable Closing Working Capital Statement or (y) if there are Disputed Amounts, then within five (5) Business Days of the resolution described in clause (v) above; and (B) be paid by wire transfer of immediately available funds to such account as is directed by Buyer or Seller, as the case may be. The amount of any Post-Closing Adjustment shall bear interest from and including the Closing Date to the date of payment at a rate per annum equal to six percent (6%). Such interest shall be calculated daily on the basis of a three hundred sixty-five (365) day year and the actual number of days elapsed.

(d) Adjustments for Tax Purposes. Any payments made pursuant to this Section 2.04 shall be treated as an adjustment to the Cash Consideration portion of the Purchase Price by the parties for Tax purposes, unless otherwise required by Law.

Section 2.05. Escrow Agreement. For the purpose of securing Seller’s indemnification obligations pursuant to ARTICLE VIII (collectively, the “Holdback Matters”), Buyer, Seller and US Bank National Association (or such other Person as the parties may agree) (the “Escrow Agent”) shall enter into the Escrow Agreement at Closing, and Buyer shall pay to the Escrow Agent at the Closing, by wire transfer of immediately available Dollars, an amount equal to the Holdback Escrow Fund. The Escrow Agent shall hold the Holdback Escrow Fund pursuant to

the terms of the Escrow Agreement. Any amounts owed to Buyer with respect to the Holdback Matters pursuant to the terms and conditions of this Agreement (other than indemnity obligations relating to Xxxxx Cross Utah Losses) shall be satisfied initially by deducting such amount from the Holdback Escrow Fund pursuant to the terms and conditions of this Agreement and the Escrow Agreement (it being agreed and understood that indemnity obligations of Seller relating to Xxxxx Cross Utah Losses shall be satisfied by Seller directly and not from the Holdback Escrow Fund except as determined by Buyer as provided in the Escrow Agreement).

Section 2.06. Closing. Subject to the terms and conditions of this Agreement, the purchase and sale of the Shares contemplated hereby shall take place at a closing (the “Closing”) to be held at 10:00 a.m., Central time, no later than three (3) Business Days after the last of the conditions to Closing set forth in ARTICLE VII have been satisfied or waived (other than conditions which, by their nature, are to be satisfied on the Closing Date), at the offices of Xxxxxxx Xxxxxx L.L.P., 000 Xxxx Xxxxxx, Xxxxx 0000, Xxxxxx, Xxxxx 00000, or at such other time or on such other date or at such other place as Seller and Buyer may mutually agree upon in writing (the day on which the Closing takes place being the “Closing Date”).

Section 2.07. Excluded Accounts Receivables. After the Closing, Buyer shall cause the Company, in good faith and applying the same standard of collection that the Company applies in respect of other similarly situated overdue accounts receivables, to seek to collect the Excluded Accounts Receivables in the ordinary course of its business. Any amounts collected by the Company within the twelve (12)-month period following the Closing Date in respect of Excluded Accounts Receivables shall be paid to Seller within fifteen (15) days after such amount is received by the Company. Seller shall not be entitled to receive any amount that is collected by the Company after the twelve (12) month anniversary of the Closing Date in respect of the Excluded Accounts Receivables.

ARTICLE III.

Representations and Warranties of Seller

Except as set forth in the correspondingly numbered Section of the Disclosure Schedules, which were delivered to Buyer on March 10, 2014 with the Original Purchase Agreement, Seller represents and warrants to Buyer that the statements contained in this ARTICLE III were true and correct as of March 10, 2014 and will be true and correct as of the Closing Date as if made on that date.

Section 3.01. Organization and Authority of Seller. Seller is a corporation duly organized, validly existing and in good standing under the Laws of the state of Delaware. Seller has full corporate power and authority to enter into this Agreement and the other Transaction Documents to which Seller is a party, to carry out its obligations hereunder and thereunder and to consummate the transactions contemplated hereby and thereby. The execution and delivery by Seller of this Agreement and any other Transaction Document to which Seller is a party, the performance by Seller of its obligations hereunder and thereunder and the consummation by Seller of the transactions contemplated hereby and thereby have been duly authorized by all requisite corporate action on the part of Seller. This Agreement has been duly executed and delivered by Seller, and (assuming due authorization, execution and delivery by Buyer) this Agreement constitutes a legal, valid and binding obligation of Seller enforceable against Seller in

accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or similar Laws affecting creditors’ rights generally and by general principles of equity (regardless of whether enforcement is sought in a proceeding at law or in equity). When each other Transaction Document to which Seller is or will be a party has been duly executed and delivered by Seller (assuming due authorization, execution and delivery by each other party thereto), such Transaction Document will constitute a legal and binding obligation of Seller enforceable against it in accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or similar Laws affecting creditors’ rights generally and by general principles of equity (regardless of whether enforcement is sought in a proceeding at law or in equity).

Section 3.02. Organization, Authority and Qualification of Xxxxxxxx and the Company.

(a) Xxxxxxxx is a corporation duly organized, validly existing and in good standing under the Laws of the state of Delaware and has full corporate power and authority to own its assets, including the Company Shares. Xxxxxxxx is licensed and qualified to do business in, and is in good standing in, the state of Arizona, which is the only jurisdiction other than the state of Delaware where such licensing or qualification is necessary. All corporate actions taken by Xxxxxxxx in connection with this Agreement and the other Transaction Documents will be duly authorized on or prior to the Closing.

(b) The Company is a corporation duly organized, validly existing and in good standing under the Laws of the state of Delaware and has full corporate power and authority to own, operate or lease the properties and assets now owned, operated or leased by it and to carry on its business as it has been and is currently conducted. Section 3.02 of the Disclosure Schedules sets forth each jurisdiction in which the Company is licensed or qualified to do business, and the Company is duly licensed or qualified to do business and is in good standing in each jurisdiction in which the properties owned or leased by it or the operation of its business as currently conducted makes such licensing or qualification necessary. All corporate actions taken by the Company in connection with this Agreement and the other Transaction Documents will be duly authorized on or prior to the Closing.

Section 3.03. Capitalization.

(a) The authorized capital stock of Xxxxxxxx consists of 1,000 shares of common stock, par value $0.01 per share, of which 100 shares are issued and outstanding and constitute the Shares. All of the Shares have been duly authorized, are validly issued, fully paid and non-assessable, and are owned of record and beneficially by Seller free and clear of all Encumbrances. Upon consummation of the transactions contemplated by this Agreement, Buyer shall own all of the Shares, free and clear of all Encumbrances (other than Encumbrances created by Buyer).

(b) The authorized capital stock of the Company consists of 1,000 shares of common stock, par value $0.01 per share, of which 100 shares are issued and outstanding and constitute the Company Shares. All of the Company Shares have been duly authorized, are validly issued, fully paid and non-assessable, and are owned of record and beneficially by Xxxxxxxx free and clear of all Encumbrances.

(c) All of the Shares and Company Shares were issued in compliance with applicable Laws. None of the Shares or Company Shares were issued in violation of any agreement, arrangement or commitment to which Seller, Xxxxxxxx or the Company is a party or is subject to or in violation of any preemptive or similar rights of any Person.

(d) There are no outstanding or authorized options, warrants, convertible securities or other rights, agreements, arrangements or commitments of any character relating to the capital stock of Xxxxxxxx or the Company or obligating Seller, Xxxxxxxx or the Company to issue or sell any shares of capital stock of, or any other interest in, Xxxxxxxx or the Company. Neither Xxxxxxxx nor the Company have outstanding or authorized any stock appreciation, phantom stock, profit participation or similar rights. There are no voting trusts, stockholder agreements, proxies or other agreements or understandings in effect with respect to the voting or transfer of any of the Shares or the Company Shares.

Section 3.04. Subsidiaries. Other than the Company, Xxxxxxxx does not own, or have any interest in any shares or have an ownership interest in any other Person and has not owned or had any interest in any shares or had an ownership interest in any other Person, except for TFI Holdings, Inc. The Company does not own, or have any interest in any shares or have an ownership interest in any other Person and has not owned or had any interest in any shares or had an ownership interest in any other Person.

Section 3.05. No Conflicts; Consents. The execution, delivery and performance by Seller of this Agreement and the other Transaction Documents to which it is a party, and the consummation of the transactions contemplated hereby and thereby, do not and will not: (a) conflict with or result in a violation or breach of, or default under, any provision of the certificate of incorporation, by-laws or other organizational documents of Seller, Xxxxxxxx or the Company; (b) conflict with or result in a violation or breach of any provision of any Law or Governmental Order applicable to Seller, Xxxxxxxx or the Company; (c) except as set forth in Section 3.05 of the Disclosure Schedules, require the consent, notice or other action by any Person under, conflict with, result in a violation or breach of, constitute a default or an event that, with or without notice or lapse of time or both, would constitute a default under, result in the acceleration of or create in any party the right to accelerate, terminate, modify or cancel any Contract to which Seller or the Company is a party or by which Seller or the Company is bound or to which any of their respective properties and assets are subject (including any Material Contract) or any Permit affecting the properties, assets or business of the Company; or (d) result in the creation or imposition of any Encumbrance other than Permitted Encumbrances on any properties or assets of Xxxxxxxx or the Company. No consent, approval, Permit, Governmental Order, declaration or filing with, or notice to, any Governmental Authority is required by or with respect to Seller, Xxxxxxxx or the Company in connection with the execution and delivery of this Agreement and the other Transaction Documents and the consummation of the transactions contemplated hereby and thereby.

Section 3.06. Financial Statements. For the avoidance of doubt, references in this Section 3.06 to any financial statements of Xxxxxxxx and TFI Holdings, Inc. (“TFIH”) refer to

the consolidated financial statements of Xxxxxxxx and TFIH (where applicable), together with the Company. Complete copies of (a) the audited consolidated financial statements showing: (i) financial position as of December 31, 2013, 2012 and 2011 and January 1, 2011 (the date of transition to IFRS), (ii) income and comprehensive income for the years ended December 31, 2013, 2012 and 2011, (iii) changes in equity for the years ended December 31, 2013, 2012 and 2011, (iv) cash flows for the years ended December 31, 2013, 2012 and 2011, and (v) notes to the consolidated financial statements, including the necessary GAAP to IFRS transition/reconciliation disclosure notes (collectively, the “Annual Financial Statements”), (b) the audit reports by KPMG LLP (“KPMG”) to the Annual Financial Statements, which will be included in the filing statement prepared by Buyer and filed with the TSX Venture Exchange and the Ontario Securities Commission (the “Filing Statement”), and (c) unaudited consolidated financial statements consisting of the balance sheets of Xxxxxxxx as of March 31, 2014 and as of December 31, 2013 and the related statements of income and comprehensive income, stockholders’ equity and cash flows for the interim period ended March 31, 2014 compared to the interim period ended March 31, 2013 and notes to such interim financial statements (the “March 2014 Interim Financial Statements”), which shall be delivered by the Seller to the Buyer, as promptly as possible, but in any event no later than July 3, 2014, and unaudited consolidated financial statements consisting of the balance sheets of Xxxxxxxx as of June 30, 2014 and as of December 31, 2013 and the related statements of income and comprehensive income, stockholders’ equity and cash flows for the three and six month interim periods ended June 30, 2014 compared to the three and six month interim periods ended June 30, 2013 and notes to such interim financial statements (the “June 2014 Interim Financial Statements”) (the March 2014 Interim Financial Statements and the June 2014 Interim Financial Statements are collectively, the “Interim Financial Statements” and together with the Annual Financial Statements are collectively, the “Financial Statements”), with respect to Xxxxxxxx, TFIH (where applicable) and the Company, shall be delivered by the Seller to the Buyer, as promptly as possible, but in any event, other than the March 2014 Interim Financial Statements, no later than July 31, 2014. In addition, the Seller shall cause to be delivered to the Buyer any consents of KPMG, subject to KPMG’s customary language for such consents, for the use of such audit reports in the Filing Statement. Seller has previously delivered to Buyer the drafts of the financial statements attached to Section 3.05 of the Disclosure Schedules (the “Draft Financial Statements”). The Financial Statements to be delivered by Seller to Buyer as provided herein shall not be materially different from the Draft Financial Statements. The Financial Statements have been prepared in accordance with IFRS and the Annual Financial Statements have been audited in accordance with International Standards on Auditing, in each case, applied on a consistent basis throughout the periods involved, subject, in the case of the Interim Financial Statements, to normal and recurring adjustments (the effect of which will not be materially adverse). The Financial Statements are based on the books and records of Xxxxxxxx, TFIH (where applicable) and the Company, and fairly present in all material respects the consolidated financial condition of Xxxxxxxx, TFIH (where applicable) and the Company as of the respective dates they were prepared and the results of the operations of Xxxxxxxx, TFIH and the Company for the periods indicated. The consolidated balance sheet of Xxxxxxxx as of December 31, 2013, is referred to herein as the “Balance Sheet” and the date thereof as the “Balance Sheet Date” and the consolidated balance sheet of Xxxxxxxx as of the most recently completed interim period, is referred to herein as the “Interim Balance Sheet” and the date thereof as the “Interim Balance Sheet Date”. Xxxxxxxx and the Company each maintains a system of accounting established and administered in accordance with GAAP.

Section 3.07. Undisclosed Liabilities. Neither Xxxxxxxx nor the Company has any liabilities, obligations or commitments of any nature whatsoever, asserted or unasserted, known or unknown, absolute or contingent, accrued or unaccrued, matured or unmatured or otherwise (“Liabilities”), except (a) those which are adequately reflected or reserved against in their respective Balance Sheet as of the Balance Sheet Date or disclosed in the notes thereto, and (b), in respect of the Company, those which have been incurred in the ordinary course of business consistent with past practice since the Balance Sheet Date and which are not, individually or in the aggregate, material in amount. Xxxxxxxx does not have any Indebtedness and Xxxxxxxx has not incurred any Liabilities since the Balance Sheet Date.

Section 3.08. Absence of Certain Changes, Events and Conditions. Since the Balance Sheet Date, (i) with respect to the Company, other than in the ordinary course of business consistent with past practice, there has not been an occurrence of any of the events set forth below and (ii) with respect to Xxxxxxxx, none of the events set forth below have occurred:

(a) event, occurrence or development that has had, or could reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect;

(b) amendment of its charter, by-laws or other organizational documents;

(d) issuance, sale or other disposition of any of its capital stock, or grant of any options, warrants or other rights to purchase or obtain (including upon conversion, exchange or exercise) any of its capital stock;

(e) declaration or payment of any dividends or distributions on or in respect of any of its capital stock or redemption, purchase or acquisition of its capital stock;

(f) material change in any method of accounting or accounting practice, except as required by GAAP or IFRS or as disclosed in the notes to the Financial Statements;

(g) material change in its cash management practices and its policies, practices and procedures with respect to collection of accounts receivable, establishment of reserves for uncollectible accounts, accrual of accounts receivable, inventory control, prepayment of expenses, payment of trade accounts payable, accrual of other expenses, deferral of revenue and acceptance of customer deposits;

(h) entry into any Contract that is material to the Company’s business other than Contracts that have been disclosed in the Disclosure Schedules;

(i) incurrence, assumption or guarantee of any Indebtedness for borrowed money, except, with respect to the Company, unsecured current obligations and Liabilities incurred in the ordinary course of business consistent with past practice in the aggregate amount not exceeding $100,000;

(j) transfer, assignment, sale or other disposition of any of the assets shown or reflected in the Balance Sheet or cancellation of any debts or entitlements;

(k) transfer, assignment or grant of any license or sublicense of any material rights under or with respect to any Intellectual Property;

(l) material damage, destruction or loss (whether or not covered by insurance) to its property;

(m) any material capital investment in, or any loan to, any other Person;

(n) acceleration, termination, material modification to or cancellation of any material Contract (including, but not limited to, any Material Contract) to which the Company is a party or by which it is bound;

(o) any material capital expenditures;

(p) imposition of any Encumbrance (other than Permitted Encumbrances) upon any of its properties, capital stock or assets, tangible or intangible;

(q) with respect to the Company, (i) grant of any bonuses, whether monetary or otherwise, or increase in any wages, salary, severance, pension or other compensation or benefits in respect of its employees, officers, directors, independent contractors or consultants, other than as provided for in any written agreements or required by applicable Law, (ii) change in the terms of employment for any employee or any termination of any employees for which the aggregate costs and expenses exceed $100,000, or (iii) action to accelerate the vesting or payment of any compensation or benefit for any employee, officer, director, independent contractor or consultant;

(r) with respect to the Company, adoption, modification or termination of any: (i) employment, severance, retention or other agreement with any current or former employee, officer, director, independent contractor or consultant, (ii) Benefit Plan, or (iii) collective bargaining or other agreement with a Union, in each case whether written or oral;

(s) any loan to (or forgiveness of any loan to), or entry into any other transaction with, any of its stockholders, directors, officers and employees;

(t) entry into a new line of business or abandonment or discontinuance of existing lines of business;

(u) adoption of any plan of merger, consolidation, reorganization, liquidation or dissolution or filing of a petition in bankruptcy under any provisions of federal or state bankruptcy Law or consent to the filing of any bankruptcy petition against it under any similar Law;

(v) purchase, lease or other acquisition of the right to own, use or lease any property or assets, except, with respect to the Company, for an amount in excess of $100,000, individually (in the case of a lease, per annum), or $250,000, or in the aggregate (in the case of a lease, for the entire term of the lease, not including any option term), except for purchases of inventory or supplies in the ordinary course of business consistent with past practice;

(w) acquisition by merger or consolidation with, or by purchase of a substantial portion of the assets or stock of, or by any other manner, any business or any Person or any division thereof;

(x) action by Xxxxxxxx or the Company to make, change or rescind any Tax election, amend any Tax Return or take any position on any Tax Return, take any action, omit to take any action or enter into any other transaction that would have the effect of increasing the Tax liability or reducing any Tax asset of Buyer in respect of any Post-Closing Tax Period; or

(y) any Contract to do any of the foregoing, or any action or omission that would result in any of the foregoing.

Section 3.09. Material Contracts. Section 3.09(a) of the Disclosure Schedules lists each of the following Contracts of the Company (such Contracts, together with all Contracts concerning the occupancy, management or operation of any Real Property (including brokerage contracts) listed or otherwise disclosed in Section 3.10(a)(ii) of the Disclosure Schedules and all Contracts relating to Intellectual Property set forth in Section 3.12(c) and Section 3.12(a) of the Disclosure Schedules, being “Material Contracts”):

(i) each Contract of the Company involving aggregate consideration in excess of $100,000 and which, in each case, cannot be cancelled by the Company without penalty or without more than ninety (90) days’ notice;

(ii) all Contracts that require the Company to purchase its total requirements of any product or service from a third party or that contain “take or pay” provisions, in each case the value over the life of the contract is in excess of $100,000;

(iii) all Contracts that provide for the indemnification by the Company of any Person or the assumption of any Tax, environmental or other Liability of any Person;

(iv) all Contracts that relate to the acquisition or disposition of any business, a material amount of stock or assets of any other Person or any real property (whether by merger, sale of stock, sale of assets or otherwise), in each case involving amounts in excess of $100,000;

(v) all broker, distributor, dealer, manufacturer’s representative, franchise, agency, sales promotion, market research, marketing consulting and advertising Contracts to which the Company is a party;

(vi) all employment agreements and Contracts between the Company and independent contractors or consultants (or similar arrangements) to which the Company is a party and which involve annual payments in excess of $100,000 and which are not cancellable without material penalty or without more than ninety (90) days’ notice;

(vii) except for Contracts relating to trade receivables, all Contracts relating to Indebtedness (including guarantees) of the Company;

(viii) all Contracts with any Governmental Authority to which the Company is a party;

(ix) all Contracts that limit or purport to limit the ability of the Company to compete in any line of business or with any Person or in any geographic area or during any period of time;

(x) any Contracts to which the Company is a party that provide for any joint venture, partnership or similar arrangement by the Company;

(xi) all Contracts between or among the Company on the one hand and Seller or any Affiliate of Seller (other than the Company) on the other hand;

(xii) all collective bargaining agreements or Contracts with any Union to which the Company is a party;

(xiii) all bonds related to Xxxxx Cross Utah (the “Xxxxx Cross Utah Bonds”);

(xiv) all bonds other than the Xxxxx Cross Utah Bonds;

(xv) all guarantees and agreements of indemnifying obligations of the Company or Xxxxxxxx related to any bonds including, but not limited to, the Interim Guaranteed Bonds, the Listed Permanent Bonds, and the Xxxxx Cross Utah Bonds; and

(xvi) any other Contract that is material to the Company and not previously disclosed pursuant to this Section 3.09.

(b) Each Material Contract is valid and binding on the Company in accordance with its terms and is in full force and effect. None of the Company or, to Seller’s Knowledge, any other party thereto is in breach of or default under (or is alleged to be in breach of or default under) in any material respect, or has provided or received any notice of any intention to terminate, any Material Contract. No event or circumstance has occurred that, with notice or lapse of time or both, would constitute an event of default under any Material Contract or result in a termination thereof or would cause or permit the acceleration or other changes of any right or obligation or the loss of any benefit thereunder. Complete and correct copies of each Material Contract (including all modifications, amendments and supplements thereto and waivers thereunder) have been made available to Buyer.

(c) Xxxxxxxx is not a party to or bound by any Contract. Since its incorporation Xxxxxxxx has not been a party to or bound by any Contracts, except that certain Stock Purchase Agreement dated April 10, 2012 by and among TFI Holdings, Inc., Green Fuel Services, LLC, Xxxxxxxx (f/k/a Xxxxxxxx Hydrocarbons Holdings Corporation), and Seller (f/k/a Xxxxxxxx Corporation) pursuant to which Xxxxxxxx acquired one hundred percent (100%) of the issued and outstanding stock of TFI Holdings, Inc. and that certain Merger Certificate of Ownership merging TFI Holdings, Inc. into Xxxxxxxx filed with the state of Delaware as of September 24, 2012.

Section 3.10. Title to Assets; Real Property.

(a) The Company has good and valid (and, in the case of owned Real Property, good and marketable fee simple) title to, or a valid leasehold interest in, all Real Property and tangible personal property and other assets reflected in the Annual Financial Statements or acquired after the Balance Sheet Date, other than properties and assets sold or otherwise disposed of in the ordinary course of business consistent with past practice since the Balance Sheet Date. All such properties and assets (including leasehold interests) are free and clear of Encumbrances except for the following (collectively referred to as “Permitted Encumbrances”):

(i) those items set forth in Section 3.10(a) of the Disclosure Schedules;

(ii) liens for Taxes not yet due and payable or being contested in good faith by appropriate procedures and for which there are adequate accruals or reserves on the Balance Sheet;

(iii) mechanics, carriers’, workmen’s, repairmen’s or other like liens;

(iv) amounts that are not delinquent and which are not, individually or in the aggregate, material to the business of the Company;

(v) easements, rights of way, zoning ordinances and other similar encumbrances affecting Real Property of record or filed for record which in either case are not, individually or in the aggregate, material to the business of the Company;

(vi) liens in favor of landlords under any leases or rental agreements that are part of the Real Property; and

(vii) other than with respect to owned Real Property, 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 which are not, individually or in the aggregate, material to the business of the Company.

(b) Section 3.10(a)(ii) of the Disclosure Schedules lists (i) the street address of each parcel of Real Property; (ii) if such property is leased or subleased by the Company, the landlord under the lease, the rental amount currently being paid, and the expiration of the term of such lease or sublease for each leased or subleased property; and (iii) the current use of such property. With respect to owned Real Property, Seller has delivered or made available to Buyer true, complete and correct copies of the deeds and other instruments (as recorded) by which the Company acquired such Real Property, and copies of all title insurance policies, opinions, abstracts and surveys in the possession of Seller or the Company and relating to the Real Property. With respect to leased Real Property, Seller has delivered or made available to Buyer true, complete and correct copies of any leases (including modifications or amendments thereto) affecting the Real Property. Except as set forth in Section 3.10(b) of the Disclosure Schedules, the Company is not a sublessor or grantor under any sublease or other instrument granting to any other Person any right to the possession, lease, occupancy or enjoyment of any leased Real Property. The condition, use or operation of the Real Property in the conduct of the Company’s business do not violate in any material respect any Law, and there are no Encumbrances on or

affecting the Real Property (other than Permitted Encumbrances). No material improvements constituting a part of the Real Property encroach on real property owned or leased by a Person other than the Company. There are no Actions pending nor, to the Seller’s Knowledge, threatened against or affecting the Real Property or any portion thereof or interest therein in the nature or in lieu of condemnation or eminent domain proceedings.

(c) Xxxxxxxx does not own, lease or operate, and has never owned, leased or operated, any real property or other tangible, or intangible assets other than the Company Shares.

Section 3.11. Condition And Sufficiency of Assets. Except as set forth in Section 3.11 of the Disclosure Schedules, the buildings, plants, structures and fixtures owned or leased by the Company are structurally sound and such buildings, plants, structures and fixtures, and all machinery, equipment, vehicles, trucks, highway tractors and railroad equipment owned by the Company are in good operating condition and repair, ordinary wear and tear excepted, and are adequate for the uses to which they are being put. The properties and assets owned or leased by the Company are sufficient for the continued conduct of the Company’s business after the Closing in substantially the same manner as conducted prior to the Closing.

Section 3.12. Intellectual Property.

(a) “Intellectual Property” means all of the following and similar intangible property and related proprietary rights, interests and protections, however arising, pursuant to the Laws of any jurisdiction throughout the world, including such property that is owned by the Company (“Company Intellectual Property”), and that in which the Company holds exclusive or non-exclusive rights or interests granted by license from other Persons, including the Seller (“Licensed Intellectual Property”); provided, however, that the term “Company Intellectual Property” shall not include any item of intellectual property related to the names “Nuverra” or “Nuverra Environmental Solutions, Inc.”, the full or partial name of any of Seller’s subsidiaries (other than the Company), or any xxxx, logo, name, design, derivation, domain name registration or other trade indicia related thereto:

(i) trademarks, service marks, trade names, brand names, logos, trade dress and other proprietary indicia of goods and services, whether registered or unregistered, and all registrations and applications for registration of such trademarks, including intent-to-use applications, all issuances, extensions and renewals of such registrations and applications and the goodwill connected with the use of and symbolized by any of the foregoing;

(ii) internet domain names, whether or not trademarks, registered in any top-level domain by any authorized private registrar or Governmental Authority;

(iii) original works of authorship in any medium of expression, whether or not published, all copyrights (whether registered or unregistered), all registrations and applications for registration of such copyrights, and all issuances, extensions and renewals of such registrations and applications;

(iv) confidential information, formulas, designs, devices, technology, know-how, research and development, inventions, methods, processes, compositions and other trade secrets, whether or not patentable; and

(v) patented and patentable designs and inventions, all design, plant and utility patents, letters patent, utility models, pending patent applications and provisional applications and all issuances, divisions, continuations, continuations-in-part, reissues, extensions, reexaminations and renewals of such patents and applications.

(b) Section 3.12(b) of the Disclosure Schedules lists all Company Intellectual Property that is either (i) subject to any issuance, registration, application or other filing by, to or with any Governmental Authority or authorized private registrar in any jurisdiction (collectively, “Intellectual Property Registrations”), including registered trademarks, domain names and copyrights, issued and reissued patents and pending applications for any of the foregoing; or (ii) used in or necessary for the Company’s current or planned business or operations. All Intellectual Property Registrations are otherwise in good standing. Seller has provided Buyer with true and complete copies of file histories, documents, certificates, office actions, correspondence and other materials related to all Intellectual Property Registrations.

(c) Section 3.12(c) of the Disclosure Schedules lists all licenses, sublicenses and other agreements whereby the Company is granted rights, interests and authority, whether on an exclusive or non-exclusive basis, with respect to any Licensed Intellectual Property that is used in or necessary for the Company’s current or planned business or operations. Seller has provided Buyer with true and complete copies of all such agreements. All such agreements are valid, binding and enforceable between the Company and the other parties thereto, and the Company and such other parties are in full compliance with the terms and conditions of such agreements.

(d) The Company Intellectual Property and Licensed Intellectual Property as currently or formerly owned, licensed or used by the Company or proposed to be used, and the Company’s conduct of its business as currently and formerly conducted and proposed to be conducted have not, and do not, infringe, violate or misappropriate the Intellectual Property of any Person. Neither Seller nor the Company has received any communication, and no Action has been instituted, settled or, to Seller’s Knowledge, threatened that alleges any such infringement, violation or misappropriation, and none of the Company Intellectual Property are subject to any outstanding Governmental Order.

(e) Section 3.12(a) of the Disclosure Schedules lists all licenses, sublicenses and other agreements pursuant to which the Company grants rights or authority to any Person with respect to any Company Intellectual Property or Licensed Intellectual Property. Seller has provided Buyer with true and complete copies of all such agreements. All such agreements are valid, binding and enforceable between the Company and the other parties thereto, and the Company and, to the Knowledge of Seller, such other parties are in material compliance with the terms and conditions of such agreements. No Person has infringed, violated or misappropriated, or is infringing, violating or misappropriating, any Company Intellectual Property.

(f) Xxxxxxxx does not own or hold or license or sublicense, nor has it ever owned, held, licensed or sublicensed, to or from any Person, any rights to any Intellectual Property other than its name, which it owns.

Section 3.13. Inventory. All inventory of the Company, whether or not reflected in the Balance Sheet, consists of a quality and quantity usable and salable in the ordinary course of

business consistent with past practice, except for obsolete, damaged, defective or slow-moving items that have been written off or written down to fair market value or for which adequate reserves have been established. All such inventory is owned by the Company free and clear of all Encumbrances (other than Permitted Encumbrances), and no inventory is held on a consignment basis. The quantities of each item of inventory (whether raw materials, work-in-process or finished goods) are not excessive, but are reasonable in the present circumstances of the Company. Xxxxxxxx does not own any inventory.

Section 3.14. Accounts Receivable. The accounts receivable reflected on the Interim Balance Sheet and the accounts receivable arising after the date thereof (a) have arisen from bona fide transactions entered into by the Company involving the sale of goods or the rendering of services in the ordinary course of business consistent with past practice; (b) constitute only valid, undisputed claims of the Company not subject to claims of set-off or other defenses or counterclaims other than normal cash discounts accrued in the ordinary course of business consistent with past practice; and (c) subject to a reserve for bad debts shown on the Interim Balance Sheet or, with respect to accounts receivable arising after the Interim Balance Sheet Date, on the accounting records of the Company, are collectible in full in the usual and ordinary course of business by dates consistent with past practice. The reserve for bad debts shown on the Interim Balance Sheet or, with respect to accounts receivable arising after the Interim Balance Sheet Date, on the accounting records of the Company have been determined in accordance with GAAP, consistently applied, subject to normal year-end adjustments and the absence of disclosures normally made in footnotes. Xxxxxxxx does not have, nor has it ever had, any accounts receivables.

Section 3.15. Customers and Suppliers.

(a) Section 3.15(a) of the Disclosure Schedules sets forth (i) the twenty (20) largest customers of the Company (based on the value of the goods or services purchased by such customer during the most recent fiscal year) (collectively, the “Material Customers”); and (ii) the amount of consideration paid by each Material Customer during such period. Except as set forth in Section 3.15(a) of the Disclosure Schedules, the Company has not received any notice, and has no reason to believe, that any of its Material Customers has ceased, or intends to cease after the Closing, to use its goods or services or to otherwise terminate or materially reduce its relationship with the Company.

(b) Section 3.15(b) of the Disclosure Schedules sets forth (i) the twenty (20) largest suppliers to the Company (based on the value of purchases from such suppliers during the most recent fiscal year) (collectively, the “Material Suppliers”); and (ii) the amount of purchases from each Material Supplier during such periods. Except as set forth in Section 3.15(b) of the Disclosure Schedules, the Company has not received any notice, and has no reason to believe, that any of its Material Suppliers has ceased, or intends to cease, to supply goods or services to the Company or to otherwise terminate or materially reduce its relationship with the Company.

Section 3.16. Insurance. Section 3.16 of the Disclosure Schedules sets forth a true and complete list of all current policies or binders of fire, liability, product liability, umbrella

liability, real and personal property, workers’ compensation, vehicular, directors’ and officers’ liability, fiduciary liability and other casualty and property insurance maintained by Seller, Xxxxxxxx, the Company or their Affiliates relating to the assets, business, operations, employees, officers and directors of Xxxxxxxx or the Company (collectively, the “Insurance Policies”) and true and complete copies of such Insurance Policies have been made available to Buyer. Such Insurance Policies are in full force and effect and shall remain in full force and effect following the consummation of the transactions contemplated by this Agreement. Neither the Seller nor any of its Affiliates (including Xxxxxxxx or the Company) has received any written notice of cancellation of, premium increase with respect to, or alteration of coverage under, any of such Insurance Policies. All premiums due on such Insurance Policies have either been paid or, if due and payable prior to Closing, will be paid prior to Closing in accordance with the payment terms of each Insurance Policy. The Insurance Policies do not provide for any retrospective premium adjustment or other experience-based liability on the part of Xxxxxxxx or the Company. All such Insurance Policies (a) are valid and binding in accordance with their terms; (b) are provided by carriers who are financially solvent; and (c) have not been subject to any lapse in coverage. Except as set forth on Section 3.16 of the Disclosure Schedules, there are no claims related to the business of Xxxxxxxx or the Company pending under any such Insurance Policies as to which coverage has been questioned, denied or disputed or in respect of which there is an outstanding reservation of rights. None of Seller or any of its Affiliates (including Xxxxxxxx and the Company) is in default under, or has otherwise failed to comply with, in any material respect, any provision contained in any such Insurance Policy. The Insurance Policies are sufficient for compliance with all applicable Laws and Contracts to which the Company is a party or by which it is bound.

Section 3.17. Legal Proceedings; Governmental Orders.

(a) Except as set forth in Section 3.17(a) of the Disclosure Schedules, there are no Actions pending or, to Seller’s Knowledge, threatened (a) against or by Xxxxxxxx or the Company affecting any of its past or present properties or assets (or by or against Seller or any Affiliate thereof and relating to Xxxxxxxx or the Company); or (b) against or by Xxxxxxxx, the Company, Seller or any Affiliate of Seller that challenges or seeks to prevent, enjoin or otherwise delay the transactions contemplated by this Agreement. To Seller’s Knowledge, no event has occurred or circumstances exist that may give rise to, or serve as a basis for, any such Action.

(b) Except as set forth in Section 3.17(b) of the Disclosure Schedules, there are no outstanding Governmental Orders and no unsatisfied judgments, penalties or awards against or affecting Xxxxxxxx or the Company or any of its past or present properties or assets. Each of Xxxxxxxx and the Company is in compliance with the terms of each Governmental Order set forth in Section 3.17(b) of the Disclosure Schedules. To Seller’s Knowledge, no event has occurred or circumstances exist that may constitute or result in (with or without notice or lapse of time) a violation of any such Governmental Order.

Section 3.18. Compliance With Laws; Permits.

(a) Except for Environmental Laws (which are covered in Section 3.19), each of Xxxxxxxx and the Company has complied, and is now complying with all Laws applicable to it or its business, properties or assets.

(b) All Permits required for the Company to conduct its business have been obtained by it and are valid and in full force and effect. Section 3.18(b) of the Disclosure Schedules lists all current Permits issued to the Company, including the names of the Permits and their respective dates of issuance and expiration. No event has occurred that, with or without notice or lapse of time or both, would reasonably be expected to result in the levy of fines against the Company or the revocation, suspension, lapse or limitation of any Permit set forth in Section 3.18(b) of the Disclosure Schedules.

(c) None of the representations and warranties contained in this Section 3.18 shall be deemed to relate to environmental matters (which are governed by Section 3.19), employee benefits matters (which are governed by Section 3.20), employment matters (which are governed by Section 3.21) or tax matters (which are governed by Section 3.22).

(d) Xxxxxxxx does not have, and has never required, any Permits for the conduct of its business.

Section 3.19. Environmental Matters.

Except as set forth in Section 3.19 of the Disclosure Schedules:

(a) Each of Xxxxxxxx and the Company is currently and has been in compliance in all material respects with all Environmental Laws and has not, and the Seller has not, received from any Person any: (i) Environmental Notice or Environmental Claim with respect to non-compliance by Xxxxxxxx or the Company with or liability under any Environmental Law which remains pending or unresolved; or (ii) request for information or any investigation pending pursuant to Environmental Law with respect to Xxxxxxxx or the Company, which, in each case, either remains pending or unresolved.

(b) Xxxxxxxx does not hold any Environmental Permits and since its incorporation Xxxxxxxx has not been required by Law to hold any Environmental Permits. The Company has obtained and is in compliance with its Environmental Permits (each of which is disclosed in Section 3.19(b) of the Disclosure Schedules or reflected as an Environmental Permit in Section 3.18(b) of the Disclosure Schedules) necessary for the ownership, lease, operation or use of the business or assets of the Company.

(c) No Real Property is listed on any list maintained by a Governmental Authority as known or suspected to be contaminated, including the National Priorities List (or CERCLIS) under CERCLA, or any similar state list.

(d) There has been no Release of Hazardous Materials at, on or under the Real Property in contravention of or subject to liability or requirements for investigation or cleanup under Environmental Law, which would reasonably be expected to result in an Environmental Claim.

(e) Neither Xxxxxxxx, the Company nor Seller has received an Environmental Notice that any Real Property of the Company or other property affected by such Real Property or any other property to which the Company has arranged for disposal (including soils, groundwater, surface water, buildings and other structure located on any such real property) has been contaminated with any Hazardous Material which would reasonably be expected to result in an Environmental Claim.

(f) Xxxxxxxx does not own or operate and has never owned or operated any storage tanks. Section 3.19(f) of the Disclosure Schedules contains a complete and accurate list of all active or closed or abandoned aboveground or underground storage tanks owned or operated by the Company.

(g) None of Seller, Xxxxxxxx or the Company has retained or assumed, by contract or operation of Law, any Liabilities or obligations of third parties under Environmental Law.

(h) Seller has provided or otherwise made available to Buyer and listed in Section 3.19(h) of the Disclosure Schedules any and all material environmental reports, studies, audits, records, sampling data, site assessments, risk assessments and other similar documents with respect to the assets of Xxxxxxxx or the Company which are in the possession or control of the Seller, Xxxxxxxx or the Company related to compliance with Environmental Laws, Environmental Claims or an Environmental Notice or the Release of Hazardous Materials.

Section 3.20. Employee Benefit Matters.

(a) Section 3.20(a) of the Disclosure Schedules contains a true and complete list of each pension, benefit, retirement, compensation, profit-sharing, deferred compensation, incentive, performance award, phantom equity, stock or stock-based, change in control, retention, severance, vacation, paid time off, fringe-benefit and other similar agreement, plan, policy, program or arrangement (and any amendments thereto), in each case whether or not reduced to writing and whether funded or unfunded, including each “employee benefit plan” within the meaning of Section 3(3) of ERISA, whether or not tax-qualified and whether or not subject to ERISA, which is or has been maintained, sponsored, contributed to, or required to be contributed to by Xxxxxxxx or the Company for the benefit of any current or former employee, officer, director, retiree, independent contractor or consultant of Xxxxxxxx or the Company or any spouse or dependent of such individual, or under which Xxxxxxxx or the Company has or may have any Liability (as listed on Section 3.20(a) of the Disclosure Schedules, each, a “Benefit Plan”).

(b) With respect to each Benefit Plan, that is sponsored solely by the Company as identified in Section 3.20(a) of the Disclosure Schedules Seller has made available to Buyer accurate, current and complete copies of each of the following: (i) where the Benefit Plan has been reduced to writing, the plan document together with all amendments; (ii) where the Benefit Plan has not been reduced to writing, a written summary of all material plan terms; (iii) where applicable, copies of any trust agreements or other funding arrangements, custodial agreements,

insurance policies and contracts, administration agreements and similar agreements, and investment management or investment advisory agreements, now in effect or required in the future as a result of the transactions contemplated by this Agreement or otherwise; (iv) copies of any summary plan descriptions, summaries of material modifications, employee handbooks and any other written communications (or a description of any oral communications) relating to any Benefit Plan; (v) in the case of any Benefit Plan that is intended to be qualified under Section 401(a) of the Code, a copy of the most recent determination, opinion or advisory letter from the Internal Revenue Service; (vi) in the case of any Benefit Plan for which a Form 5500 is required to be filed, a copy of the most recently filed Form 5500, with schedules attached; (vii) actuarial valuations and reports related to any Benefit Plans with respect to the two most recently completed plan years; and (viii) copies of material notices, letters or other correspondence from the Internal Revenue Service, Department of Labor or Pension Benefit Guaranty Corporation relating to the Benefit Plan.

(c) Except as set forth in Section 3.20(c) of the Disclosure Schedules, each Benefit Plan (other than any multiemployer plan within the meaning of Section 3(37) of ERISA (each a “Multiemployer Plan”)) has been established, administered and maintained in accordance with its terms and in material compliance with all applicable Laws (including ERISA and the Code). Each Benefit Plan that is intended to be qualified under Section 401(a) of the Code (a “Qualified Benefit Plan”) has received a favorable and current determination letter from the Internal Revenue Service, or with respect to a prototype plan, can rely on an opinion letter from the Internal Revenue Service to the prototype plan sponsor, to the effect that such Qualified Benefit Plan is so qualified and, to Seller’s Knowledge, nothing has occurred that could reasonably be expected to cause the revocation of such determination letter from the Internal Revenue Service or the unavailability of reliance on such opinion letter from the Internal Revenue Service, as applicable, nor has such revocation or unavailability been threatened. Nothing has occurred with respect to any Benefit Plan that has subjected or, to Seller’s Knowledge, could reasonably be expected to subject the Company to a penalty under Section 502 of ERISA or to tax or penalty under Section 4975 of the Code. Except as set forth in Section 3.20(c) of the Disclosure Schedules, all benefits, contributions and premiums relating to each Benefit Plan have been timely paid in accordance with the terms of such Benefit Plan (or assumed) in full on the balance sheet contained in the Closing Working Capital Statement.

(d) Except as set forth in Section 3.20(d) of the Disclosure Schedules, with respect to each Benefit Plan (i) no such plan is subject to Title IV of ERISA or Section 412 of the Code; (ii) no such plan is a Multiemployer Plan; and (iii) no such plan is a “multiple employer plan” within the meaning of Section 413(c) of the Code or a “multiple employer welfare arrangement” as defined in Section 3(40) of ERISA, (iv) neither the Company nor any of its ERISA Affiliates has incurred or reasonably expects to incur, either directly or indirectly, any material Liability under Title I or Title IV of ERISA or related provisions of the Code or foreign Law relating to employee benefit plans; (v) no Action has been initiated by the Pension Benefit Guaranty Corporation to terminate any such plan or to appoint a trustee for any such plan; (vi) no such plan is subject to the minimum funding standards of Section 302 of ERISA or Section 412 of the Code; and (vii) no “reportable event,” as defined in Section 4043 of ERISA, has occurred with respect to any such plan.

(e) Except as set forth in Section 3.20(e) of the Disclosure Schedules and required by applicable Law, no provision of any Benefit Plan or collective bargaining agreement could reasonably be expected to result in any limitation on Buyer or any of its Affiliates from amending or terminating any Benefit Plan. The Company has no commitment or obligation and has not made any representations to any employee, officer, director, independent contractor or consultant, whether or not legally binding, to adopt, amend or modify any Benefit Plan or any collective bargaining agreement, in connection with the consummation of the transactions contemplated by this Agreement or otherwise.

(f) Except as would not have a Material Adverse Effect, neither Seller nor the Company: (i) have withdrawn from any pension plan under circumstances resulting (or expected to result) in a liability to the Pension Benefit Guaranty Corporation; or (ii) has engaged in any transaction which would give rise to a liability of the Company or under Section 4069 or Section 4212(c) of ERISA.

(g) Except as set forth in Section 3.20(g) of the Disclosure Schedules and other than as required under Section 601 et. seq. of ERISA, Section 4980B of the Code, or other applicable Law, no Benefit Plan provides post-termination or retiree welfare benefits to any individual for any reason, and the Company does not have any Liability to provide post-termination or retiree welfare benefits to any individual or ever represented, promised or contracted to any individual.

(h) Except as set forth in Section 3.20(h) of the Disclosure Schedules, there is no pending or, to Seller’s Knowledge, threatened Action relating to a Benefit Plan (other than routine claims for benefits), and no Benefit Plan has within the three (3) years prior to March 10, 2014, been the subject of an examination or audit by a Governmental Authority or the subject of an application or filing under or is a participant in, an amnesty, voluntary compliance, self-correction or similar program sponsored by any Governmental Authority.

(i) Each Benefit Plan that is subject to Section 409A of the Code has been operated in compliance with such section and all applicable regulatory guidance (including notices, rulings and proposed and final regulations). With respect to each Benefit Plan that is subject to Section 409A of the Code, the Company does not have any agreement with any service provider to provide any reimbursement or tax gross-up for any Code Section 409A tax liability incurred by such service provider.

(j) Except as set forth in Section 3.20(j) of the Disclosure Schedules, neither the execution of this Agreement nor any of the transactions contemplated by this Agreement will (either alone or upon the occurrence of any additional or subsequent events): (i) entitle any current or former director, officer, employee, independent contractor or consultant of the Company to severance pay or any other payment from the Company; (ii) accelerate the time of payment, funding or vesting, or increase the amount of compensation due to any such individual from the Company; (iii) limit or restrict the right of the Company to merge, amend or terminate any Benefit Plan sponsored solely by the Company; (iv) increase the amount payable by the Company under or result in any other material obligation of the Company pursuant to any Benefit Plan sponsored solely by the Company; or (v) result in “excess parachute payments” within the meaning of Section 280G(b) of the Code.

(k) Xxxxxxxx does not maintain, sponsor, contribute to, nor has it ever maintained, sponsored, contributed to, or been required to contribute to, a Benefit Plan.

Section 3.21. Employment Matters.

(a) Section 3.21(a) of the Disclosure Schedules contains a list of all persons who are employees, independent contractors or consultants of the Company as of March 10, 2014, who currently or for any of the past two (2) years have earned aggregate compensation in excess of $100,000, and sets forth for each such individual the following: (i) name; (ii) title or position (including whether full or part time); (iii) hire date; (iv) current annual base compensation rate; (v) commission, bonus or other incentive-based compensation; and (vi) a description of the fringe benefits provided to each such individual as of March 10, 2014. Except as set forth in Section 3.21(a) of the Disclosure Schedules, as of March 10, 2014, all compensation, including wages, commissions and bonuses, payable to employees, independent contractors or consultants of the Company for services performed on or prior to March 10, 2014, have been paid in full (or accrued in full on the audited balance sheet contained in the Closing Working Capital Statement) and there are no outstanding agreements, understandings or commitments of the Company with respect to any compensation, commissions or bonuses. Xxxxxxxx does not have any employees and since its incorporation Xxxxxxxx has not hired, engaged or employed any person, independent contractor, or consultant.

(b) Except as set forth in Section 3.21(b) of the Disclosure Schedules, neither Xxxxxxxx nor the Company is, and has not been for the past five (5) years, a party to, bound by, or negotiating any collective bargaining agreement or other Contract with a union, works council or labor organization (collectively, “Union”), and there is not, and has not been for the past five (5) years, any Union representing or purporting to represent any employee of Xxxxxxxx or the Company, and no Union or group of employees is seeking or has sought to organize employees for the purpose of collective bargaining. Except as set forth in Section 3.21(b) of the Disclosure Schedules within three (3) years prior to March 10, 2014, there has not been, nor, to Seller’s Knowledge, has there been any threat of, any strike, slowdown, work stoppage, lockout, concerted refusal to work overtime or other similar labor disruption or dispute affecting the Company or any of its employees. Neither Xxxxxxxx nor the Company has a duty to bargain with any Union.

(c) Each of Xxxxxxxx and the Company is and has been in compliance with the terms of the collective bargaining agreements and other Contracts listed on Section 3.21(b) of the Disclosure Schedules and all applicable Laws pertaining to employment and employment practices, including all Laws relating to labor relations, equal employment opportunities, fair employment practices, employment discrimination, harassment, retaliation, reasonable accommodation, disability rights or benefits, immigration, wages, hours, overtime compensation, child labor, hiring, promotion and termination of employees, working conditions, meal and break periods, privacy, health and safety, workers’ compensation, leaves of absence and unemployment insurance. All individuals characterized and treated by the Company as independent contractors or consultants are properly treated as independent contractors under all applicable Laws. All employees classified as exempt under the Fair Labor Standards Act and state and local wage and hour laws are properly classified. Except as set forth in Section 3.21(c) of the Disclosure Schedules, there are no Actions against the Company pending, or to the

Seller’s Knowledge, threatened to be brought or filed, by or with any Governmental Authority or arbitrator in connection with the employment of any current or former applicant, employee, consultant, volunteer, intern or independent contractor of the Company, including any claim relating to unfair labor practices, employment discrimination, harassment, retaliation, equal pay, wage and hours or any other employment related matter arising under applicable Laws. Except as set forth in Section 3.18(c) of the Disclosure Schedules, there have been no Actions within the preceding two (2) years by or on behalf of any employee or independent contractor of the Company or by any federal, state, or local agency concerning the wages, benefits, working conditions, hiring, or termination of any employee or independent contractor of the Company, and there have been no settlements of any claim by any employee or independent contractor against the Company within the preceding two (2) years.

(d) The Company has complied with the WARN Act and has no plans to undertake any action in the future that would trigger the WARN Act.

Section 3.22. Taxes. Except as set forth in Section 3.22 of the Disclosure Schedules:

(a) All Tax Returns required to be filed on or before the Closing Date by Xxxxxxxx or the Company have been, or will be, timely filed. Such Tax Returns were true, complete and correct in all respects. All Taxes due and owing by Xxxxxxxx or the Company (whether or not shown on any Tax Return) have been, or will be, timely paid.

(b) Neither Xxxxxxxx nor the Company is a beneficiary of any extension of time within which to file a Tax Return.

(c) Each of Xxxxxxxx and the Company has withheld and paid each Tax required to have been withheld and paid in connection with amounts paid or owing to any employee, independent contractor, creditor, customer, shareholder or other party, and complied with all information reporting and backup withholding provisions of applicable Law.

(d) No claim has been made by any taxing authority in any jurisdiction where Xxxxxxxx or the Company does not file Tax Returns that it is, or may be, subject to Tax by that jurisdiction.

(e) No extensions or waivers of statutes of limitations have been given or requested with respect to any Taxes of Xxxxxxxx or the Company.

(f) The amount of Xxxxxxxx’x or the Company’s Liability for unpaid Taxes for all periods ending on or before December 31, 2013, does not, in the aggregate, exceed the amount of accruals for Taxes (excluding reserves for deferred Taxes) reflected on the respective Financial Statements of Xxxxxxxx and the Company. The amount of Xxxxxxxx’x and the Company’s Liability for unpaid Taxes for all periods following the end of the recent period covered by their respective Financial Statements shall not, in the aggregate, exceed the amount of accruals for Taxes (excluding reserves for deferred Taxes) as adjusted for the passage of time in accordance with the past custom and practice of Xxxxxxxx or the Company (and which accruals shall not exceed comparable amounts incurred in similar periods in prior years).

(g) Section 3.22(g) of the Disclosure Schedules sets forth:

(i) the taxable years of Xxxxxxxx and the Company as to which the applicable statutes of limitations on the assessment and collection of Taxes have not expired;

(ii) those years for which examinations by the taxing authorities have been completed; and

(iii) those taxable years for which examinations by taxing authorities are presently being conducted.

(h) All deficiencies asserted, or assessments made, against Xxxxxxxx or the Company as a result of any examinations by any taxing authority have been fully paid.

(i) Neither Xxxxxxxx nor the Company is a party to any Action by any taxing authority. There are no pending, threatened or expected Actions by any taxing authority.

(j) Seller has delivered to Buyer copies of all federal, state, local and foreign income, franchise and similar Tax Returns, examination reports, and statements of deficiencies assessed against, or agreed to by, Xxxxxxxx or the Company for all Tax periods for which the applicable statutes of limitations on the assessment and collection of Taxes have not expired.

(k) There are no Encumbrances for Taxes (other than Permitted Encumbrances) upon the assets of Xxxxxxxx or the Company.

(l) Neither Xxxxxxxx nor the Company is a party to, or bound by, any Tax indemnity, Tax-sharing or Tax allocation agreement.

(m) Neither Xxxxxxxx nor the Company is a party to, or bound by, any closing agreement or offer in compromise with any taxing authority.

(n) No private letter rulings, technical advice memoranda or similar agreement or rulings have been requested, entered into or issued by any taxing authority with respect to Xxxxxxxx or the Company.

(o) Neither Xxxxxxxx nor the Company is party to any agreement, contract, arrangement or plan that will result in any payment of (i) an “excess parachute payments” within the meaning of Section 280G(b) of the Code or (ii) any amount that would not be fully deductible as a result of Section 162(m) of the Code (or any corresponding provision of state, local or non U.S. tax law).

(p) Neither Xxxxxxxx nor the Company has been a member of an affiliated, combined, consolidated or unitary Tax group for Tax purposes. Neither Xxxxxxxx nor the Company has Liability for Taxes of any Person (other than Xxxxxxxx or the Company, respectively) under Treasury Regulations Section 1.1502-6 (or any corresponding provision of state, local or foreign Law), as transferee or successor, by contract or otherwise.

(q) Each of Xxxxxxxx and the Company has disclosed on its federal income Tax Returns all positions taken therein that could give rise to a substantial understatement of federal income Tax within the meaning of Section 6662 of the Code.

(r) Neither Xxxxxxxx nor the Company has agreed to make, nor is it required to make, any adjustment under Sections 481(a) or 263A of the Code or any comparable provision of state, local or foreign Tax Laws by reason of a change in accounting method or otherwise.

(s) Seller is not a “foreign person” as that term is used in Treasury Regulations Section 1.1445-2. Neither Xxxxxxxx nor the Company is, nor has it been, a United States real property holding corporation (as defined in Section 897(c)(2) of the Code) during the applicable period specified in Section 897(c)(1)(a) of the Code.

(t) Neither Xxxxxxxx nor the Company has been a “distributing corporation” or a “controlled corporation” in connection with a distribution described in Section 355 of the Code.

(u) Neither Xxxxxxxx nor the Company is, or has been, a party to, or a promoter of, a “reportable transaction” within the meaning of Section 6707A(c)(1) of the Code and Treasury Regulations Section 1.6011-4(b).

(v) There is currently no limitation on the utilization of net operating losses, capital losses, built-in losses, tax credits or similar items that are allocable to Xxxxxxxx or the Company under Sections 269, 382, 383, 384 or 1502 of the Code and the Treasury Regulations thereunder (and comparable provisions of state, local or foreign Law).

(w) Section 3.22(w) of the Disclosure Schedules sets forth all foreign jurisdictions in which the Company is subject to Tax, is engaged in business or has a permanent establishment. Xxxxxxxx is only subject to Tax in Arizona and Delaware and is not engaged in business or have a permanent establishment in any other jurisdictions. Neither Xxxxxxxx nor the Company has entered into a gain recognition agreement pursuant to Treasury Regulations Section 1.367(a)-8. Neither Xxxxxxxx nor the Company has transferred an intangible the transfer of which would be subject to the rules of Section 367(d) of the Code.

(x) None of the assets of Xxxxxxxx or the Company is property that Xxxxxxxx or the Company is required to treat as being owned by any other person pursuant to the so-called “safe harbor lease” provisions of former Section 168(f)(8) of the Internal Revenue Code of 1954, as amended.

Section 3.23. Books and Records. The minute books and stock record books of Xxxxxxxx and the Company, all of which have been made available to Buyer, are complete and correct and have been maintained in accordance with sound business practices. The minute books of Xxxxxxxx and the Company contain accurate and complete records of all meetings, and actions taken by written consent of, the stockholders, the board of directors and any committees of the board of directors of Xxxxxxxx and the Company, as applicable, and no meeting, or action taken by written consent, of any such stockholders, board of directors or committee has been held for which minutes have not been prepared and are not contained in such minute books. At the Closing, all of those books and records will be in the possession of Xxxxxxxx or the Company, respectively.

Section 3.24. Brokers. Except for Xxxxxxxx Xxxxx, no broker, finder or investment banker is entitled to any brokerage, finder’s or other fee or commission in connection with the transactions contemplated by this Agreement or any other Transaction Document based upon arrangements made by or on behalf of Seller.

Section 3.25. Investment Purpose. Seller is an “accredited investor” as defined in Rule 501(a) of Regulation D of the Securities Act of 1933, as amended, and Seller is acquiring the Parent Shares solely for its own account for investment purposes and not with a view to, or for offer or sale in connection with, any distribution thereof. Seller acknowledges that the Parent Shares are not registered under the Securities Act of 1933, as amended, or any state securities laws, and that the Parent Shares may not be transferred or sold except pursuant to the registration provisions of the Securities Act of 1933, as amended or pursuant to an applicable exemption therefrom and subject to state securities laws and regulations, as applicable. In addition, Seller is an “accredited investor”, as such term is defined in Canadian Securities Administrators National Instrument 45-106. At Closing, Seller will complete and execute a “U.S. Accredited Investor Certificate” and a “Canadian Accredited Investor Certificate” in such form as Parent may reasonably require. Seller acknowledges that in addition to any registration provisions or exemptions therefrom under the Securities Act of 1933, as amended, and any state securities laws, the Seller must also comply with any resale restrictions under Canadian Securities Administrators National Instruments 45-102. Buyer is able to bear the economic risk of holding the Parent Shares for an indefinite period (including total loss of its investment), and has sufficient knowledge and experience in financial and business matters so as to be capable of evaluating the merits and risk of its investment.

Section 3.26. No Other Representations and Warranties. Except for the representations and warranties contained in this ARTICLE III (including the related portions of the Disclosure Schedules), none of Seller, Xxxxxxxx, the Company or any other Person has made or makes any other express or implied representation or warranty, either written or oral, on behalf of Seller, Xxxxxxxx or the Company, including any representation or warranty as to the accuracy or completeness of any information regarding Xxxxxxxx or the Company furnished or made available to Buyer and its Representatives, including any information, documents or material made available to Buyer in the Data Room, management presentations or in any other form in expectation of the transactions contemplated hereby or as to the future revenue, profitability or success of the Company, or any representation or warranty arising from statute or otherwise in law.

Section 3.27. Xxxxxxxx’x Status as a Holding Company. Notwithstanding anything in ARTICLE III to the contrary, Xxxxxxxx does not have, and never has had, any assets or Liabilities, except for its ownership of the Company Shares. Since its incorporation, Xxxxxxxx has been a holding company, without any employees, consultants or operations, with the single purpose of owning and holding the Company Shares.

ARTICLE IV.

Representations and Warranties of Buyer

Except as set forth in the correspondingly numbered Section of the Disclosure Schedules, Buyer represents and warrants to Seller that the statements contained in this ARTICLE IV were true and correct as of March 10, 2014, and will be correct on the Closing Date as if made on that date.

Section 4.01. Organization and Authority of Buyer. Buyer is a corporation duly organized, validly existing and in good standing under the Laws of the State of Texas. Buyer has full corporate power and authority to enter into this Agreement and the other Transaction Documents to which Buyer is a party, to carry out its obligations hereunder and thereunder and to consummate the transactions contemplated hereby and thereby. The execution and delivery by Buyer of this Agreement and any other Transaction Document to which Buyer is a party, the performance by Buyer of its obligations hereunder and thereunder and the consummation by Buyer of the transactions contemplated hereby and thereby have been duly authorized by all requisite corporate action on the part of Buyer. This Agreement has been duly executed and delivered by Buyer, and (assuming due authorization, execution and delivery by Seller) this Agreement constitutes a legal, valid and binding obligation of Buyer enforceable against Buyer in accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or similar Laws affecting creditors’ rights generally and by general principles of equity (regardless of whether enforcement is sought in a proceeding at law or in equity). When each other Transaction Document to which Buyer is or will be a party has been duly executed and delivered by Buyer (assuming due authorization, execution and delivery by each other party thereto), such Transaction Document will constitute a legal and binding obligation of Buyer enforceable against it in accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or similar Laws affecting creditors’ rights generally and by general principles of equity (regardless of whether enforcement is sought in a proceeding at law or in equity).

Section 4.02. No Conflicts; Consents. The execution, delivery and performance by Buyer of this Agreement and the other Transaction Documents to which it is a party, and the consummation of the transactions contemplated hereby and thereby, do not and will not: (a) conflict with or result in a violation or breach of, or default under, any provision of the certificate of incorporation, by-laws or other organizational documents of Buyer; (b) conflict with or result in a violation or breach of any provision of any Law or Governmental Order applicable to Buyer; require the consent, notice or other action by any Person under any Contract to which Buyer is a party. No consent, approval, Permit, Governmental Order, declaration or filing with, or notice to, any Governmental Authority is required by or with respect to Buyer in connection with the execution and delivery of this Agreement and the other Transaction Documents and the consummation of the transactions contemplated hereby and thereby, except for such consents, approvals, Permits, Governmental Orders, declarations, filings or notices which, in the aggregate, would not have a Material Adverse Effect.

Section 4.03. Investment Purpose. Buyer is acquiring the Shares solely for its own account for investment purposes and not with a view to, or for offer or sale in connection with, any distribution thereof. Buyer acknowledges that the Shares are not registered under the Securities Act of 1933, as amended, or any state securities laws, and that the Shares may not be transferred or sold except pursuant to the registration provisions of the Securities Act of 1933, as amended or pursuant to an applicable exemption therefrom and subject to state securities laws and regulations, as applicable. Buyer is able to bear the economic risk of holding the Shares for an indefinite period (including total loss of its investment), and has sufficient knowledge and experience in financial and business matters so as to be capable of evaluating the merits and risk of its investment.

Section 4.04. Brokers. No broker, finder or investment banker is entitled to any brokerage, finder’s or other fee or commission in connection with the transactions contemplated by this Agreement or any other Transaction Document based upon arrangements made by or on behalf of Buyer.

Section 4.05. Legal Proceedings. There are no Actions pending or, to Buyer’s knowledge, threatened against or by Buyer or any Affiliate of Buyer that challenge or seek to prevent, enjoin or otherwise delay the transactions contemplated by this Agreement. No event has occurred or circumstances exist that may give rise or serve as a basis for any such Action.

Section 4.06. Independent Investigation. Buyer has conducted its own independent investigation, review and analysis of the business, results of operations, prospects, condition (financial, environmental or otherwise) or assets of the Company, and acknowledges that it has been provided adequate access to the personnel, properties, assets, premises, books and records, and other documents and data of Seller and the Company for such purpose. Buyer acknowledges and agrees that: (a) in making its decision to enter into this Agreement and to consummate the transactions contemplated hereby, Buyer has relied solely upon its own investigation and the express representations and warranties of Seller set forth in ARTICLE III of this Agreement (including the related portions of the Disclosure Schedules); and (b) none of Seller, the Company or any other Person has made any representation or warranty as to Seller, the Company or this Agreement, except as expressly set forth in ARTICLE III of this Agreement (including the related portions of the Disclosure Schedules).

Section 4.07. Parent Shares. All shares constituting the Parent Shares which are issued to Seller pursuant to this Agreement shall, if and when issued, be duly and validly issued, fully paid and nonassessable and free from all Taxes and Encumbrances. Buyer shall take all such actions as may be necessary to assure that all such Parent Shares may be issued without violation of any applicable Law or governmental regulation.

ARTICLE V.

Covenants

Section 5.01. Conduct of Business Prior to the Closing. From March 10, 2014 and until the Closing, except as otherwise provided in this Agreement or consented to in writing by Buyer, Seller shall, and shall cause Xxxxxxxx and the Company to, (x) conduct the business of Xxxxxxxx and the Company in the ordinary course of business consistent with past practice; and (y) use reasonable best efforts to maintain and preserve intact the current organization, business and franchise of Xxxxxxxx and the Company and to preserve the rights, franchises, goodwill and relationships of Employees, customers, lenders, suppliers, regulators and others having business relationships with the Company. Without limiting the foregoing, from March 10, 2014 until the Closing Date, Seller shall:

(a) cause the Company to preserve and maintain all of its Permits;

(b) cause each of Xxxxxxxx and the Company to pay its debts, Taxes and other obligations when due;

(c) cause the Company to maintain the properties and assets owned, operated or used by the Company in the same condition as they were on the date of this Agreement, subject to reasonable wear and tear;

(d) cause each of Xxxxxxxx and the Company to continue in full force and effect without modification all Insurance Policies, except as required by applicable Law;

(e) cause the Company to perform all of its obligations under all Material Contracts;

(f) cause each of Xxxxxxxx and the Company to maintain its books and records in accordance with past practice;

(g) cause each of Xxxxxxxx and the Company to comply in all material respects with all applicable Laws; and

(h) cause each of Xxxxxxxx and the Company to not take or permit any action that would cause any of the changes, events or conditions described in Section 3.08 to occur.

Section 5.02. Access to Information. From March 10, 2014 until the Closing, Seller shall, and shall cause Xxxxxxxx and the Company to, (a) afford Buyer and its Representatives reasonable access to and the right to inspect all of the Real Property, properties, assets, premises, books and records, Contracts and other documents and data related to Xxxxxxxx and the Company; (b) furnish Buyer and its Representatives with such financial, operating and other data and information related to Xxxxxxxx and the Company as Buyer or any of its Representatives may reasonably request; and (c) instruct the Representatives of Seller, Xxxxxxxx and the Company to cooperate with Buyer in its investigation of Xxxxxxxx and the Company; provided, however, that any such investigation shall be conducted during normal business hours upon reasonable advance notice to Seller, under the supervision of Seller’s personnel and in such a manner as not to interfere with the normal operations of Xxxxxxxx and the Company. Without limiting the foregoing, Seller shall permit Buyer and its Representatives to conduct environmental due diligence of the Company and the Real Property, including the collecting and analysis of samples of indoor or outdoor air, surface water, groundwater or surface or subsurface soils on, at, in, under or from the Company and the Real Property. All requests by Buyer for access pursuant to this Section 5.02 shall be submitted or directed exclusively to Xxxxxxxx Xxxxx or such other individuals or entities as Seller may designate in writing from time to time. Notwithstanding anything to the contrary in this Agreement, neither Seller, Xxxxxxxx nor the Company shall be required to disclose any information to Buyer if such disclosure would, in Seller’s sole discretion, acting reasonably: (y) jeopardize any attorney-client or other privilege; or (z) contravene any applicable Law, fiduciary duty or binding agreement entered into prior to the date of this Agreement; provided that if Seller, Xxxxxxxx or the Company withholds any information for such a reason, it or they shall in writing notify Buyer of its or their decision to do so, the subject matter of the information withheld and the reason the information was withheld. Buyer shall not contact any suppliers to, or customers of, the Company prior to the Closing, without the prior written consent of Seller. Buyer shall, and shall cause its Representatives to, abide by the terms of the Confidentiality Agreement with respect to any access or information provided pursuant to this Section 5.02.

Section 5.03. Supplement to Disclosure Schedules.

(a) From March 10, 2014, which is the date Seller delivered Disclosure Schedules pursuant to the Original Agreement and which identical Disclosure Schedules are deemed delivered hereunder, through Closing, Seller shall amend the Disclosure Schedules as previously delivered by Seller to Buyer if at any time any representation and warranty of Seller is not true and correct (a “Schedule Supplement”). The delivery of a Schedule Supplement shall be made by Seller within one (1) Business Day of Seller discovering a representation or warranty hereunder is not true and correct. Simultaneously with the execution of this Agreement Seller is delivering to Buyer the first Disclosure Schedule Supplement (the “First Schedule Supplement”).

(b) If the Schedule Supplement corresponds to a representation and warranty that was true and correct as of March 10, 2014, and a breach of such representation and warranty would occur only if the representation and warranty were made after that date, then Seller shall not have any liability under this Agreement (including any obligation to indemnify any other party under ARTICLE VIII) with respect to such a breach of a representation and warranty that has occurred only after March 10, 2014, if the Seller has disclosed to Buyer, prior to the Closing, the facts, events or circumstances that would give rise to such breach; and, if (i) such breach is a breach under Section 3.01, Section 3.03 or Section 3.10(a), (ii) such breach arises by reason of Seller’s fraud or willful conduct, or (iii) the facts, events or circumstances that would give rise to such breach have a Material Adverse Effect, Buyer shall have the right to terminate this Agreement pursuant to Section 9.01(b)(iii) upon receiving such Schedule Supplement.

(c) If the Schedule Supplement corresponds to a representation and warranty that was not true and correct as of March 10, 2014, then Seller shall have all liability under this Agreement (including any obligation to indemnify any other party under ARTICLE VIII) with respect to breach of that representation and warranty for failure of the Seller to disclose to Buyer, prior to that date, the facts, events or circumstances that would give rise to such breach and Buyer shall have the right to terminate this Agreement pursuant to Section 9.01(b)(iv) upon receiving such Schedule Supplement. This Section 5.03(c) applies to the First Schedule Supplement

Section 5.04. Resignations. Seller shall deliver to Buyer written resignations, effective as of the Closing Date, of such officers and directors of Xxxxxxxx and the Company that Buyer may identify in a written request delivered to Seller at least five (5) Business Days prior to the Closing.

Section 5.05. Employees; Benefit Plans.

(a) During the period commencing at the Closing and ending on the date which is twelve (12) months from the Closing (or if earlier, the date of the employee’s termination of employment with the Company), Buyer shall and shall cause the Company to provide each Employee who remains employed immediately after the Closing (“Company Continuing

Employee”) with: (i) base salary or hourly wages which are no less than the base salary or hourly wages provided by the Company immediately prior to the Closing; (ii) target bonus opportunities (excluding equity-based compensation), if any, which are no less than the target bonus opportunities (excluding equity-based compensation) provided by the Company immediately prior to the Closing; (iii) retirement and welfare benefits that are no less favorable in the aggregate than those provided by the Company immediately prior to the Closing; and (iv) severance benefits that are no less favorable than the practice, plan or policy in effect for such Company Continuing Employee immediately prior to the Closing.

(b) With respect to any Benefit Plan and other “employee benefit plans” (within the meaning of Section 3(3) of ERISA) maintained by Buyer or its Subsidiaries (collectively, “Buyer Benefit Plans”) in which any Company Continuing Employees will participate effective as of the Closing, Buyer shall, or shall cause the Company to, recognize all service of the Company Continuing Employees with the Company, as the case may be as if such service were with Buyer, for vesting and eligibility purposes in any Buyer Benefit Plan in which such Company Continuing Employees may be eligible to participate after the Closing Date; provided, however, such service shall not be recognized to the extent that (x) such recognition would result in a duplication of benefits or (y) such service was not recognized under the corresponding Benefit Plan.

(c) This Section 5.05 shall be binding upon and inure solely to the benefit of each of the parties to this Agreement, and nothing in this Section 5.05, express or implied, shall confer upon any other Person any rights or remedies of any nature whatsoever under or by reason of this Section 5.05. Nothing contained herein, express or implied, shall be construed to establish, amend or modify any benefit plan, program, agreement or arrangement. The parties hereto acknowledge and agree that the terms set forth in this Section 5.05 shall not create any right in any Employee or any other Person to any continued employment with the Company, Buyer or any of their respective Affiliates or compensation or benefits of any nature or kind whatsoever.

Section 5.06. Plant Closings and Mass Layoffs. Buyer shall not, and shall cause the Company to not, take any action following the Closing that could result in WARN Act liability.

Section 5.07. Director and Officer Indemnification and Insurance.

(a) For a period of six (6) years after the Closing, Buyer shall cause the organizational documents of Xxxxxxxx and the Company, respectively, to contain provisions relating to the exculpation, indemnification or advancement of expenses of any officers and directors that are no less favorable to the officers and directors of Xxxxxxxx and the Company, respectively, who were officers and directors prior to the Closing (each, a “D&O Indemnified Person”) that are presently set forth in organizational documents of Xxxxxxxx and the Company, respectively.

(b) Subject to subsection (d) below, in addition, from and after the Closing through the sixth anniversary thereof, unless earlier paid by the Tail Policy, Buyer shall, and shall cause Xxxxxxxx and the Company (each, a “D&O Indemnifying Party”) to, to the fullest extent permitted by applicable Law (but solely to the extent of the coverage actually provided under the Tail Policy), (i) indemnify and hold harmless the D&O Indemnified Persons against all D&O

Expenses (as defined below), losses, claims, damages, judgments or amounts paid in settlement (collectively, “D&O Costs”) in respect of any threatened, pending or completed Action, whether criminal, civil, administrative or investigative, based on or arising out or relating to the fact that such Person is or was a director or officer of Xxxxxxxx or the Company and arising out of acts or omissions occurring on or prior to the Closing (but solely to the extent of the coverage actually provided for under the Tail Policy) (a “D&O Indemnifiable Claim”), and (ii) advance to such D&O Indemnified Persons all D&O Expenses incurred in connection with any D&O Indemnifiable Claim (including in circumstances where the D&O Indemnifying Party has assumed the defense of such claim) promptly after receipt of reasonably detailed statements therefor (but solely to the extent of the coverage actually provided for under the Tail Policy); provided, however, that the D&O Indemnified Person to whom D&O Expenses are to be advanced provides an undertaking to repay such advances if it is ultimately determined that such D&O Indemnified Person is not entitled to indemnification. Any D&O Indemnifiable Claims shall continue until such D&O Indemnifiable Claim is disposed of or all judgments, orders, decrees or other rulings in connection with such D&O Indemnifiable Claim are fully satisfied (but solely to the extent of the coverage actually provided for in Xxxxxxxx’x or the Company’s organizational documents, respectively). For the purposes of this Section 5.07(b), “D&O Expenses” means reasonable attorneys’ fees and all other costs, charges and expenses paid or incurred in connection with investigating, defending, being a witness in or participating in (including on appeal), or preparing to defend, be a witness in or participate in any D&O Indemnifiable Claim, but shall exclude losses, claims, damages, judgments or amounts paid in settlement (which items are, for the avoidance of doubt, included in the definition of D&O Costs, but solely to the extent of the coverage actually provided for in Xxxxxxxx’x or the Company’s organizational documents, respectively).

(c) At the Closing, Seller may purchase irrevocable “tail” insurance policies naming the D&O Indemnified Persons as direct beneficiaries (the “Tail Policy”), on such terms and with such premiums as Buyer and Seller may agree. If such insurance has a term of six (6) years or more, Buyer shall be responsible to pay the premiums for such insurance for eighteen (18) months following the Closing and Seller shall be solely responsible for the premiums for such insurance thereafter (or, if the premiums for the entire term of the insurance is payable in a single or multiple payments during a period that is less than six (6) years after the Closing, Buyer shall be responsible for twenty-five percent (25%) of the aggregate amount of such premiums and Seller shall be responsible for the balance thereof.) Buyer shall not, and shall cause Xxxxxxxx and the Company not to, cancel or change such insurance policies in any respect, provided that all maintenance and premium obligations of Seller have been satisfied.

(d) Seller and the D&O Indemnified Persons shall cause all proceeds from the Tail Policy to be paid directly to Buyer, Xxxxxxxx or the Company, as the case may be, in order to reimburse Buyer, Xxxxxxxx and the Company for all D&O Costs and D&O Expenses paid by Buyer, Xxxxxxxx, and the Company.

(e) In the event Buyer, Xxxxxxxx, the Company or any of their respective successors or assigns, (i) consolidates with or merges into any other Person and shall not be the continuing or surviving corporation or entity in such consolidation or merger, or (ii) transfers all or substantially all of its properties and assets to any Person, then and in either such case proper provision shall be made so that the successors and assigns of Buyer, Xxxxxxxx or the Company,

as the case may be, shall assume the obligations set forth in this Section 5.07. The provisions of this Section 5.07 shall survive the consummation of the transactions contemplated by this Agreement and are expressly intended to benefit each of the D&O Indemnified Persons.

Section 5.08. Financing Process Assistance.

(a) Seller, Xxxxxxxx and the Company shall use commercially reasonable efforts, at Buyer’s sole cost and expense, to provide such cooperation reasonably requested by Buyer with respect to the financing to be completed by Buyer with respect to the transactions contemplated hereby (the “Financing”) including: (i) subject to customary confidential requirements reasonably acceptable to Seller, providing to Buyer’s Financing sources all material financial and other information in their possession with respect to Xxxxxxxx and the Company as reasonably requested by Buyer or Buyer’s Financing sources (including such information as may be reasonably required for circulars or other disclosure documents relating to the Financing); (ii) making the Company’s senior officers reasonably available to Buyer’s Financing sources in connection with the Financing, to reasonably participate in due diligence and marketing sessions; (iii) executing and delivering any certificates, instruments or documents and back-up therefore and for legal opinions as may be reasonably requested by Buyer (including consents of accountants for use of their reports in any materials relating to the Financing) and otherwise reasonably facilitating the pledging of collateral (including assistance with respect to procuring survey and title for owned Real Property); (iv) obtaining the payoff letters and Encumbrance terminations and instruments of discharge contemplated by this Agreement; and (v) furnishing Buyer and its Financing sources reasonably promptly with such documentation and other information in Seller’s, Xxxxxxxx’x and the Company’s possession which any lender providing or arranging Financing has reasonably requested and that such lender has determined is required by regulatory authorities in connection with such Financing under applicable “know your customer” and anti-money laundering rules and regulations, including the Patriot Act.

(b) Seller shall (i) deliver to Buyer, as promptly as possible, but in any event no later than July 31, 2014, the Financial Statements; provided, however, Seller shall deliver the March 2014 Interim Financial Statements no later than July 3, 2014; and (ii) cause to be delivered to Buyer any consents and/or comfort letters of KPMG required with respect to the Financing.

(c) Notwithstanding anything in this Section 5.08 to the contrary, the fees and expenses of KPMG for preparing the Annual Financial Statements as required under Section 3.06 shall be shared equally between Buyer and Seller (provided Buyer’s total liability for such fees and expenses shall not exceed $125,000). Such financial statements shall be based on the books and records of Xxxxxxxx, TFIH and the Company and be prepared in accordance with IFRS applied on a consistent basis throughout the periods involved.

Section 5.09. No Solicitation of Other Bids.

(a) Seller shall not, and shall not authorize or permit any of its Affiliates (including Xxxxxxxx and the Company) or any of its or their Representatives to, directly or indirectly, (i) encourage, solicit, initiate, facilitate or continue inquiries regarding an Acquisition Proposal; (ii) enter into discussions or negotiations with, or provide any information to, any Person concerning a possible Acquisition Proposal; or (iii) enter into any agreements or other instruments (whether

or not binding) regarding an Acquisition Proposal. Seller shall immediately cease and cause to be terminated, and shall cause its Affiliates (including Xxxxxxxx and the Company) and all of its and their Representatives to immediately cease and cause to be terminated, all existing discussions or negotiations with any Persons conducted heretofore with respect to, or that could lead to, an Acquisition Proposal. For purposes hereof, “Acquisition Proposal” shall mean any inquiry, proposal or offer from any Person (other than Buyer or any of its Affiliates) concerning (i) a merger, consolidation, liquidation, recapitalization, share exchange or other business combination transaction involving Xxxxxxxx or the Company; (ii) the issuance or acquisition of shares of capital stock or other equity securities of Xxxxxxxx or the Company; or (iii) the sale, lease, exchange or other disposition of any significant portion of Xxxxxxxx’x or the Company’s business, properties or assets.

(b) In addition to the other obligations under this Section 5.09, Seller shall promptly (and in any event within three (3) Business Days after receipt thereof by Seller or its Representatives) advise Buyer of any Acquisition Proposal, the material terms and conditions of such Acquisition Proposal, and the identity of the Person making the same.

(c) Seller agrees that the rights and remedies for noncompliance with this Section 5.09 shall include having such provision specifically enforced by any court having equity jurisdiction, it being acknowledged and agreed that any such breach or threatened breach shall cause irreparable injury to Buyer and that money damages would not provide an adequate remedy to Buyer.

Section 5.10. Notice of Certain Events.

(a) From March 10, 2014 until the Closing, Seller shall promptly notify Buyer in writing of:

(i) any fact, circumstance, event or action the existence, occurrence or taking of which (A) has had, or could reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect, (B) has resulted in, or could reasonably be expected to result in, any representation or warranty made by Seller hereunder not being true and correct and Seller shall take the actions required by Section 5.03 or (C) has resulted in, or could reasonably be expected to result in, the failure of any of the conditions set forth in Section 7.02 to be satisfied;

(ii) any notice or other communication from any Person alleging that the consent of such Person is or may be required in connection with the transactions contemplated by this Agreement;

(iii) any notice or other communication from any Governmental Authority in connection with the transactions contemplated by this Agreement; and

(iv) any Actions commenced or, to Seller’s Knowledge, threatened against, relating to or involving or otherwise affecting Seller, Xxxxxxxx or the Company that, if pending on the date of this Agreement, would have been required to have been disclosed pursuant to Section 3.17 or that relates to the consummation of the transactions contemplated by this Agreement.

(b) Except as set forth in Section 5.03, Buyer’s receipt of information pursuant to this Section 5.10 shall not operate as a waiver or otherwise affect any representation, warranty or agreement given or made by Seller in this Agreement (including Section 8.02 and Section 9.01(b)) and shall not be deemed to amend or supplement the Disclosure Schedules.

Section 5.11. Confidentiality. Buyer acknowledges and agrees that the Confidentiality Agreement remains in full force and effect and, in addition, covenants and agrees to keep confidential, in accordance with the provisions of the Confidentiality Agreement, information provided to Buyer with respect to Seller pursuant to this Agreement after the Closing. If this Agreement is, for any reason, terminated prior to the Closing, the Confidentiality Agreement and the provisions of this Section 5.11 shall nonetheless continue in full force and effect.

Section 5.12. Non-competition; Non-solicitation.

(a) For a period of five (5) years commencing on the Closing Date (the “Restricted Period”), Seller shall not, and shall not permit any of its Affiliates to, directly or indirectly, (i) engage in or assist others in engaging in the Restricted Business in the Territory; (ii) have an interest in any Person that engages directly or indirectly in the Restricted Business in the Territory in any capacity, including as a partner, shareholder, member, employee, principal, agent, trustee, lender or consultant; or (iii) interfere in any respect with the business relationships (whether formed prior to or after the date of this Agreement) between the Company and customers or suppliers of the Company. Notwithstanding the foregoing, Seller may own, directly or indirectly, solely as an investment, securities of any Person traded on any national securities exchange if Seller is not a controlling Person of, or a member of a group which controls, such Person and does not, directly or indirectly, own five percent (5%) or more of any class of securities of such Person.

(b) During the Restricted Period, Seller shall not, and shall not permit any of its Affiliates to, directly or indirectly, hire or solicit any employee of the Company or encourage any such employee to leave such employment or hire any such employee who has left such employment, except pursuant to a general solicitation which is not directed specifically to any such employees; provided, that nothing in this Section 5.12(b) shall prevent Seller or any of its Affiliates from hiring (i) any employee whose employment has been terminated by the Company or Buyer; (ii) after one hundred eighty (180) days from the date of termination of employment, any employee whose employment has been terminated by the employee; or (iii) any employee, other than a management employee, as a result of the use of a general solicitation (such as a newspaper or internet advertisement) not specifically directed to such employee.

(c) Seller acknowledges that a breach or threatened breach of this Section 5.12(c) would give rise to irreparable harm to Buyer, for which monetary damages would not be an adequate remedy, and hereby agrees that in the event of a breach or a threatened breach by Seller of any such obligations, Buyer shall, in addition to any and all other rights and remedies that may be available to it in respect of such breach, be entitled to equitable relief, including a temporary restraining order, an injunction, specific performance and any other relief that may be available from a court of competent jurisdiction (without any requirement to post bond).

(d) Seller acknowledges that the restrictions contained in this Section 5.12(d) are reasonable and necessary to protect the legitimate interests of Buyer and constitute a material inducement to Buyer to enter into this Agreement and consummate the transactions contemplated by this Agreement. In the event that any covenant contained in this Section 5.12(d) should ever be adjudicated to exceed the time, geographic, product or service, or other limitations permitted by applicable Law in any jurisdiction, then any court is expressly empowered to reform such covenant, and such covenant shall be deemed reformed, in such jurisdiction to the maximum time, geographic, product or service, or other limitations permitted by applicable Law. The covenants contained in this Section 5.12(d) and each provision hereof are severable and distinct covenants and provisions. The invalidity or unenforceability of any such covenant or provision as written shall not invalidate or render unenforceable the remaining covenants or provisions hereof, and any such invalidity or unenforceability in any jurisdiction shall not invalidate or render unenforceable such covenant or provision in any other jurisdiction.

Section 5.13. Governmental Approvals and Consents.

(a) Each party hereto shall, as promptly as possible, (i) make, or cause or be made, all filings and submissions required under any Law applicable to such party or any of its Affiliates; and (ii) use reasonable best efforts to obtain, or cause to be obtained, all consents, authorizations, orders and approvals from all Governmental Authorities that may be or become necessary for its execution and delivery of this Agreement and the performance of its obligations pursuant to this Agreement and the other Transaction Documents. Each party shall cooperate fully with the other party and its Affiliates in promptly seeking to obtain all such consents, authorizations, orders and approvals, including the Required Consents. The parties hereto shall not willfully take any action that will have the effect of delaying, impairing or impeding the receipt of any required consents, authorizations, orders and approvals.

(b) Seller and Buyer shall use reasonable best efforts to give all notices to, and obtain all consents from, all third parties that are described in Section 3.05 of the Disclosure Schedules.

(c) Without limiting the generality of the parties’ undertakings pursuant to subsections (a) and (b) above, each of the parties hereto shall use all reasonable best efforts to:

(i) respond to any inquiries by any Governmental Authority regarding antitrust or other matters with respect to the transactions contemplated by this Agreement, any agreement or any Transaction Document;

(ii) avoid the imposition of any order or the taking of any action that would restrain, alter or enjoin the transactions contemplated by this Agreement or any Transaction Document; and

(iii) in the event any Governmental Order adversely affecting the ability of the parties to consummate the transactions contemplated by this Agreement or any Transaction Document has been issued, to have such Governmental Order vacated or lifted.

(d) If any consent, approval or authorization necessary to preserve any right or benefit under any Contract to which the Company is a party is not obtained prior to the Closing, Seller shall, subsequent to the Closing, cooperate with Buyer and the Company in attempting to

obtain such consent, approval or authorization as promptly thereafter as practicable. If such consent, approval or authorization cannot be obtained, upon the request of Buyer, Seller shall use its reasonable best efforts to provide the Company with the rights and benefits of the affected Contract for the term thereof, and, if Seller provides such rights and benefits, the Company shall assume all obligations and burdens thereunder.

(e) All analyses, appearances, meetings, discussions, presentations, memoranda, briefs, filings, arguments, and proposals made by or on behalf of either party before any Governmental Authority or the staff or regulators of any Governmental Authority, in connection with the transactions contemplated hereunder (but, for the avoidance of doubt, not including any interactions between Seller, Xxxxxxxx or the Company with Governmental Authorities in the ordinary course of business) shall be disclosed to the other party hereunder in advance of any filing, submission or attendance, it being the intent that the parties will consult and cooperate with one another, and consider in good faith the views of one another, in connection with any such analyses, appearances, meetings, discussions, presentations, memoranda, briefs, filings, arguments, and proposals. Each party shall give notice to the other party with respect to any meeting, discussion, appearance or contact with any Governmental Authority or the staff or regulators of any Governmental Authority, with such notice being sufficient to provide the other party with the opportunity to attend and participate in such meeting, discussion, appearance or contact.

(f) Notwithstanding the foregoing, nothing in this Section 5.13 shall require, or be construed to require, Buyer or any of its Affiliates to agree to (i) sell, hold, divest, discontinue or limit, before or after the Closing Date, any assets, businesses or interests of Buyer, Xxxxxxxx, the Company or any of their respective Affiliates; (ii) any conditions relating to, or changes or restrictions in, the operations of any such assets, businesses or interests which, in either case, could reasonably be expected to result in a Material Adverse Effect or materially and adversely impact the economic or business benefits to Buyer of the transactions contemplated by this Agreement; or (iii) any material modification or waiver of the terms and conditions of this Agreement.

(g) Seller and Buyer shall use commercially reasonable efforts to give all notices to, and obtain all Required Consents on or prior to the Closing Date; provided, however, that Seller shall not be obligated to pay any consideration therefor to any third party from whom consent or approval is requested.

Section 5.14. Books and Records.

(a) In order to facilitate the resolution of any claims made against or incurred by Seller prior to the Closing, or for any other reasonable purpose, for a period of four (4) years after the Closing, Buyer shall:

(i) retain the books and records (including personnel files) of Xxxxxxxx and the Company relating to periods prior to the Closing in a manner reasonably consistent with the prior practices of Xxxxxxxx and the Company; and

(ii) upon reasonable notice, afford the Representatives of Seller reasonable access (including the right to make, at Seller’s expense, photocopies), during normal business hours, to such books and records;

provided, however, that any books and records related to Tax matters shall be retained pursuant to the periods set forth in ARTICLE VI.

(b) In order to facilitate the resolution of any claims made by or against or incurred by Buyer, Xxxxxxxx or the Company after the Closing, or for any other reasonable purpose, for a period of four (4) years following the Closing, Seller shall:

(i) retain the books and records (including personnel files) of Seller which relate to each of Xxxxxxxx and the Company and its operations for periods prior to the Closing; and

(ii) upon reasonable notice, afford the Representatives of Buyer, Xxxxxxxx or the Company reasonable access (including the right to make, at Buyer’s expense, photocopies), during normal business hours, to such books and records;

provided, however, that any books and records related to Tax matters shall be retained pursuant to the periods set forth in ARTICLE VI.

(c) Neither Buyer nor Seller shall be obligated to provide the other party with access to any books or records (including personnel files) pursuant to this Section 5.14 where such access would violate any Law.

Section 5.15. Closing Conditions. From March 10, 2014, until the Closing, each party hereto shall, and Seller shall cause Xxxxxxxx and the Company to, use reasonable best efforts to take such actions as are necessary to expeditiously satisfy the closing conditions set forth in ARTICLE VII hereof.

Section 5.16. Public Announcements. Unless otherwise required by applicable Law or stock exchange requirements (based upon the reasonable advice of counsel), no party to this Agreement shall make any public announcements in respect of this Agreement, the other Transaction Documents or the transactions contemplated hereby or thereby or otherwise communicate with any news media without the prior written consent of the other party (which consent shall not be unreasonably withheld or delayed), and the parties shall cooperate as to the timing and contents of any such announcement.

Section 5.17. Further Assurances. Following the Closing, each of the parties hereto shall, and shall cause their respective Affiliates to, execute and deliver such additional documents, instruments, conveyances and assurances and take such further actions as may be reasonably required to carry out the provisions hereof and give effect to the transactions contemplated by this Agreement.

Section 5.18. Guarantees.

(a) Section 5.18(a)(i) of the Disclosure Schedules sets forth indemnification agreements (the “Listed Indemnification Agreements”) whereby Seller indemnifies and guarantees the obligations of the Company under the bonds listed on Section 5.18(a)(ii) of the Disclosure Schedules (the “Interim Guaranteed Bonds”). During the period of time from the date of this Agreement through the date ending six months after the Closing Date (the “Interim Period”), Buyer shall use commercially reasonable efforts to negotiate its own indemnification agreements with respect to the Interim Guaranteed Bonds. If Seller is required, at any time after the Closing Date, to pay amounts related to the Interim Guaranteed Bonds under the Listed Indemnification Agreements, Buyer shall indemnify Seller for such amounts pursuant to Section 8.03(c).

(b) In addition to the Interim Guaranteed Bonds, the Listed Indemnification Agreements also guarantee the bonds listed on Section 5.18(b) of the Disclosure Schedules (the “Listed Permanent Bonds”). Until Buyer reasonably agrees in writing that an indemnification or guarantee of the Listed Permanent Bonds is no longer required by the insurer of such bonds or as required by any Law or Governmental Authority, Seller shall maintain in force such Listed Indemnification Agreements (or any replacement thereof required by the foregoing).

(c) Seller shall maintain in force any other indemnification agreements or guarantee that Seller or an Affiliate of Seller entered into on or before the Closing Date that guaranties or provides indemnity with respect to any bonds that are not Interim Guaranteed Bonds (the “Unlisted Indemnification Agreements”) until Buyer reasonably agrees in writing that such indemnification agreement or guarantee is no longer required.

(d) Seller shall perform all of Seller’s, or cause its Affiliates to perform such Affiliate’s, obligations, and take all actions, required under the Listed Indemnification Agreements and Unlisted Indemnification Agreements for the relevant periods of time required above.

Section 5.19. Payment of Bonds. If Buyer incurs any Losses reasonably incurred to maintain or replace any Listed Permanent Bonds, Xxxxx Cross Utah Bonds, Unlisted Indemnification Agreements, or otherwise related to a facility closed before the Closing Date, Buyer shall provide Seller with written notice of such amount and Seller shall pay that amount to Buyer within three (3) Business Days.

Section 5.20. Leased Vehicles. During the Interim Period, Seller shall make all necessary arrangements to allow Buyer to make use of all vehicles leased to the Company governed by that certain Lease and Fleet Management Services Agreement dated as of October 31, 2011 by and among ARI Fleet LT, Automotive Rentals, Inc., and Xxxxxxxx Water Resources (CVR), Inc. (the “Interim Vehicle Lease”). During the Interim Period, Seller shall use commercially reasonable efforts to assist Buyer in executing a new lease agreement or agreements with respect to the vehicles leased under the Interim Vehicle Lease.

ARTICLE VI.

Tax Matters

Section 6.01. Tax Covenants.

(a) Without the prior written consent of Buyer, Seller (and, prior to the Closing, Xxxxxxxx, the Company, their respective Affiliates and their respective Representatives) shall not, to the extent it may affect, or relate to, Xxxxxxxx or the Company, make, change or rescind any Tax election, amend any Tax Return or take any position on any Tax Return, take any action, omit to take any action or enter into any other transaction that would have the effect of increasing the Tax liability or reducing any Tax asset of Buyer, Xxxxxxxx or the Company in respect of any Post-Closing Tax Period or Post-Closing Straddle Period, provided, however, that Seller, Xxxxxxxx, the Company, their Affiliates and their respective representatives shall be entitled to make any Tax election and take any action or enter into any other transactions without the consent of Buyer provided that such Tax election, action or transaction is in Seller’s, Xxxxxxxx’x, the Company’s or the Affiliates’ ordinary course of business.

(b) Without the prior written consent of Seller, Buyer shall not, to the extent it may affect, or relate to, Xxxxxxxx or the Company, make, change or rescind any Tax election, amend any Tax Return or take any position on any Tax Return, take any action, omit to take any action or enter into any other transaction that would have the effect of increasing the Tax liability or reducing any Tax asset of Seller, Xxxxxxxx or the Company in respect of any Pre-Closing Tax Period or Pre-Closing Straddle Period, provided, however, that Buyer, Xxxxxxxx, the Company, their respective Affiliates and their respective representatives shall be entitled to make any Tax election and take any action or enter into any other transactions without the consent of Seller provided that such Tax election, action or transaction is in Xxxxxxxx’x or the Company’s ordinary course of business.

(c) All transfer, documentary, sales, use, stamp, registration, value added and other such Taxes and fees (including any penalties and interest) incurred in connection with this Agreement and the other Transaction Documents (including any real property transfer Tax and any other similar Tax) shall be borne and paid by Buyer when due. Buyer shall, at its own expense, timely file any Tax Return or other document with respect to such Taxes or fees (and Seller shall cooperate with respect thereto as necessary).

(d) Seller shall prepare or cause to be prepared and file or cause to be filed all Tax Returns of Xxxxxxxx and the Company with respect to any Pre-Closing Tax Period (the “Pre-Closing Period Returns”). The Pre-Closing Period Returns shall be prepared and filed in a manner that is consistent with Xxxxxxxx’x, the Company’s and/or the Seller’s prior practice (including, without limitation, prior Tax elections and accounting methods or conventions made or utilized by Xxxxxxxx, the Company and/or the Seller), except as required by Law. Buyer shall prepare, or cause to be prepared, the Straddle Period Returns. The Straddle Period Returns shall be prepared in a manner consistent with past practice (unless otherwise required by Law) and without a change of any election or any accounting method and shall be submitted by Buyer to Seller (together with schedules, statements and, to the extent requested by Seller, supporting documentation) at least forty-five (45) days prior to the due date (including extensions) of such Tax Return. If Seller objects to any item on any such Straddle Period Return, it shall, within ten (10) days after delivery of such Tax Return, notify Buyer in writing that it so objects, specifying with particularity any such item and stating the specific factual or legal basis for any such objection. If a notice of objection shall be duly delivered, Buyer and Seller shall negotiate in

good faith and use their reasonable best efforts to resolve such items. If Buyer and Seller are unable to reach such agreement within ten (10) days after receipt by Buyer of such notice, the disputed items shall be resolved by resolved by a nationally recognized accounting firm selected by Buyer and reasonably acceptable to Seller (the “Accounting Referee”), and any determination by the Accounting Referee shall be final. The Accounting Referee shall resolve any disputed items within twenty (20) days of having the item referred to it pursuant to such procedures as it may require. If the Accounting Referee is unable to resolve any disputed items before the due date for such Tax Return, the Straddle Period Return shall be filed as prepared by Buyer subject to amendment to reflect the Accounting Referee’s resolution. The costs, fees and expenses of the Accounting Referee shall be borne equally by Buyer and Seller. The Buyer shall not amend any Straddle Period Returns, or make or amend any material claim, disclaimer or election in respect of Taxes for any Straddle Period, without the prior written consent of the Seller, which consent shall not be unreasonably withheld, conditioned or delayed. The preparation and filing of any Tax Return of Xxxxxxxx or the Company other than Pre-Closing Period Returns and Straddle Period Returns shall be exclusively within the control of Buyer.

Section 6.02. Termination of Existing Tax Sharing Agreements. Any and all existing Tax sharing agreements (whether written or not) binding upon Xxxxxxxx or the Company shall be terminated as of the Closing Date. After such date none of Xxxxxxxx, the Company, Seller or any of Seller’s Affiliates and their respective Representatives shall have any further rights or liabilities thereunder.

Section 6.03. Tax Indemnification. Except to the extent treated as a liability in the calculation of Closing Working Capital, Seller shall indemnify Xxxxxxxx, the Company, Buyer, and each Buyer Indemnitee and hold them harmless from and against (i) all Pre-Closing Taxes of Xxxxxxxx and the Company; (ii) all Taxes of any member of an affiliated, consolidated, combined or unitary group of which Xxxxxxxx or the Company (or any predecessor of Xxxxxxxx or the Company) is or was a member on or prior to the Closing Date by reason of a liability under Treasury Regulation Section 1.1502-6 or any comparable provisions of foreign, state or local Law; and (iii) all Taxes of any person imposed on Xxxxxxxx or the Company arising under the principles of transferee or successor liability or by contract, relating to an event or transaction occurring before the Closing Date. In each of the above cases, together with any out-of-pocket fees and expenses (including attorneys’ and accountants’ fees) incurred in connection therewith; provided however, that in the case of any out-of-pocket fees and expenses (including attorneys’ and accountants’ fees) incurred in connection with Pre-Closing Taxes, Seller shall only indemnify Buyer for the fees and expenses (including attorneys’ and accountants’ fees) of Buyer that relate to Pre-Closing Taxes of a Pre-Closing Tax Period. Seller shall reimburse Buyer for any Taxes of Xxxxxxxx or the Company that are the responsibility of Seller pursuant to this Section 6.03(a) within ten (10) Business Days after payment of such Taxes by Buyer, Xxxxxxxx or the Company.

(b) Buyer shall indemnify each Seller Indemnitee and hold them harmless from and against (i) all Post-Closing Taxes of Xxxxxxxx and the Company; (ii) all Taxes for which the Buyer is liable pursuant to Section 6.01(c) and (iii) Taxes that arise as a result of a voluntary transaction, action or omission carried out or effected by the Buyer or any of the Buyer’s Affiliates (including Xxxxxxxx and the Company) at any time after the Closing on the Closing Date, provided, however, that Seller shall remain liable for Taxes attributable to such

transactions, actions or omissions that are carried out or effected on the Closing Date under a legally binding commitment of Xxxxxxxx or the Company created before the Closing. In each of the above cases, together with any out-of-pocket fees and expenses (including attorneys’ and accountants’ fees) incurred in connection therewith; provided however, that in the case of any out-of-pocket fees and expenses (including attorneys’ and accountants’ fees) incurred in connection with Post-Closing Taxes, Buyer shall only indemnify Seller for the fees and expenses (including attorneys’ and accountants’ fees) of Seller that relate to Post-Closing Taxes of a Post-Closing Tax Period. Buyer shall reimburse Seller for any Taxes of Xxxxxxxx or the Company that are the responsibility of Buyer pursuant to this Section 6.03(b) within ten (10) Business Days after payment of such Taxes by Seller.

Section 6.04. Straddle Period. For purposes of this Agreement, the portion of Taxes attributable to the income, property or operations of Xxxxxxxx or the Company for any taxable period that begins on or before the Closing Date and ends after the Closing Date (a “Straddle Period”) will be apportioned between the period of the Straddle Period that begins before the Closing Date and ends on and includes the Closing Date (the “Pre-Closing Straddle Period”) and the period of the Straddle Period that begins the day after the Closing Date and ends at the end of the Straddle Period (the “Post-Closing Straddle Period”) in accordance with this Section 6.04. For purposes of this Section 6.04, the portion of Taxes attributable to a Pre-Closing Straddle Period shall (i) in the case of any sales or use taxes, value-added taxes, employment taxes, withholding taxes and any other Tax based on or measured by income, business activity, receipts or profits earned by Xxxxxxxx or the Company during a Straddle Period, be deemed to equal the amount that would be payable if the Straddle Period ended on and included the Closing Date; and (ii) in the case of personal property, real property, ad valorem and other Taxes of Xxxxxxxx or the Company imposed on a periodic basis during a Straddle Period, be deemed to be the amount of the Taxes for the entire Straddle Period multiplied by a fraction, the numerator of which is the number of days in the Pre-Closing Straddle Period and the denominator of which is the number of days in such Straddle Period. The portion of Taxes attributable to a Post-Closing Straddle Period shall be calculated in a corresponding manner.

Section 6.05. Contests. If any Governmental Authority issues to Xxxxxxxx or the Company a written notice of its intent to audit, examine or conduct a proceeding, a written notice of its determination of an objection to an assessment with respect to Taxes or Tax Returns of Xxxxxxxx or the Company for a Pre-Closing Tax Period or a Straddle Period, or a written notice or inquiry with respect to any Taxes or the filing of a Tax Return for a Pre-Closing Tax Period or a Straddle Period (a “Tax Claim”), Buyer shall notify Seller of its receipt of such Tax Claim within ten (10) Business Days following receipt, provided however, that the failure of the Buyer to notify Seller of its receipt of a Tax Claim within ten (10) Business Days shall not relieve the Seller from liability pursuant to Section 6.03(a) except to the extent the Seller is materially prejudiced as a consequence of such failure. Seller shall control any Tax Claim and any other matter with respect to a Pre-Closing Tax Period of Xxxxxxxx or the Company (a “Seller’s Tax Contest”), provided that Buyer, at its sole cost and expense, shall have the right to participate in any Seller’s Tax Contest that does not involve income Taxes and provided further that the Seller shall provide the Buyer with a copy of the final resolution of any Seller’s Tax Contest and any other information reasonably requested by Buyer concerning any Seller’s Tax Contest, provided that such requests relate solely to information of Xxxxxxxx or the Company. The Buyer shall control any Tax Claim that is not a Seller’s Tax Contest (a “Buyer’s Tax Contest”), provided

that Seller, at its sole cost and expense, shall have the right to participate in any Buyer’s Tax Contest that relates to a Straddle Period Return. The party controlling a Tax Claim described in the preceding sentence shall not agree to settle such Tax Claim if such settlement could affect the Tax liability of the other party without the written consent of such other party, which consent shall not be unreasonably withheld, conditioned or delayed, provided that if any party (the “First Party”) shall reasonably withhold consent for a settlement, the other party (the “Second Party”) shall be entitled to enter into such settlement without the consent of the First Party so long as the Second Party agrees to indemnify the First Party for any adverse Tax consequences suffered by the First Party as a result of such settlement.

Section 6.06. Tax Refunds. Any Tax refunds of Xxxxxxxx, the Company and/or the Seller or its Affiliates that relate to a Pre-Closing Tax Period or a Pre-Closing Straddle Period of Xxxxxxxx or the Company and that are received by Buyer, and any amounts applied in lieu of a refund against Taxes of the Buyer and/or its Affiliates that relate to a Pre-Closing Tax Period or a Pre-Closing Straddle Period of Xxxxxxxx or the Company, shall be for the account of the Seller to the extent such refund or application was not reflected in the calculation of Closing Working Capital, and Buyer shall pay over to Seller any such refund or the amount of such application within fifteen (15) days after receipt or application against Tax; provided, however, that the foregoing portion of this Section 6.06 shall not apply to any portion of such Tax refunds or amounts applied in lieu of a refund against Taxes of the Buyer and/or its Affiliates that result from the carryback or other application of any loss, credit or other Tax attribute arising in a Post-Closing Tax Period or a Post-Closing Straddle Period of Xxxxxxxx or the Company.

Section 6.07. Cooperation and Exchange of Information. Seller and Buyer shall provide each other with such cooperation and information as either of them reasonably may request of the other in filing any Tax Return pursuant to this ARTICLE VI or in connection with any audit or other proceeding in respect of Taxes of Xxxxxxxx or the Company. Such cooperation and information shall include providing copies of relevant Tax Returns or portions thereof, together with accompanying schedules, related work papers and documents relating to rulings or other determinations by tax authorities. Each of Seller and Buyer shall retain all Tax Returns, schedules and work papers, records and other documents in its possession relating to Tax matters of Xxxxxxxx or the Company for any Pre-Closing Tax Period and any Straddle Period until the expiration of the statute of limitations of such taxable periods to which such Tax Returns and other documents relate, without regard to extensions except to the extent notified by the other party in writing of such extensions for the respective Tax periods. Prior to transferring, destroying or discarding any Tax Returns, schedules and work papers, records and other documents in its possession relating to Tax matters of Xxxxxxxx or the Company (i.e., such information does not include information of any other member of any consolidated group of which Xxxxxxxx or the Company is a member) for any taxable period beginning before the Closing Date, Seller or Buyer (as the case may be) shall provide the other party with reasonable written notice and offer the other party the opportunity to take custody of such materials.

Section 6.08. Tax Treatment of Indemnification Payments. Any indemnification payments pursuant to this ARTICLE VI shall be treated as an adjustment to the Purchase Price by the parties for Tax purposes, unless otherwise required by Law.

Section 6.09. Survival. Notwithstanding anything in this Agreement to the contrary, the provisions of Section 3.22 and this ARTICLE VI shall survive for the full period of all applicable statutes of limitations (giving effect to any waiver, mitigation or extension thereof) plus sixty (60) days.

Section 6.10. Overlap. To the extent that any obligation or responsibility pursuant to ARTICLE VIII may overlap with an obligation or responsibility pursuant to this ARTICLE VI, the provisions of this ARTICLE VI shall govern.

ARTICLE VII.

Conditions to Closing

Section 7.01. Conditions to Obligations of All Parties. The obligations of each party to consummate the transactions contemplated by this Agreement shall be subject to the fulfillment, at or prior to the Closing, of each of the following conditions:

(a) No Governmental Authority shall have enacted, issued, promulgated, enforced or entered any Governmental Order which is in effect and has the effect of making the transactions contemplated by this Agreement illegal, otherwise restraining or prohibiting consummation of such transactions or causing any of the transactions contemplated hereunder to be rescinded following completion thereof.

(b) Seller shall have received all consents, authorizations, orders and approvals from the Governmental Authorities referred to in Section 3.05 in form and substance reasonably satisfactory to Buyer and Seller, and no such consent, authorization, order and approval shall have been revoked.

Section 7.02. Conditions to Obligations of Buyer. The obligations of Buyer to consummate the transactions contemplated by this Agreement shall be subject to the fulfillment or Buyer’s waiver, at or prior to the Closing, of each of the following conditions:

(a) [Reserved].

(b) [Reserved].

(c) Buyer shall have received and, acting reasonably, be satisfied with the results of the due diligence conducted by its legal counsel on Seller’s ownership of the Shares and the Company’s ownership of its owned real properties and rights and obligations relating to its leased real properties.

(d) Buyer shall have received committed financing to complete the transactions contemplated by this Agreement (including Buyer’s obligation to satisfy the Cash Consideration on the Closing Date) on or before the Drop Dead Date.

(e) The representations and warranties of Seller contained in this Agreement and any certificate or other writing delivered pursuant hereto shall be true and correct in all respects (in the case of any representation or warranty qualified by materiality or Material Adverse Effect) or in all material respects (in the case of any representation or warranty not qualified by materiality

or Material Adverse Effect) on and as of March 10, 2014, and on and as of the Closing Date with the same effect as though made at and as of such date (except those representations and warranties that address matters only as of a specified date, the accuracy of which shall be determined as of that specified date in all respects).

(f) Seller shall have duly performed and complied in all material respects with all agreements, covenants and conditions required by this Agreement to be performed or complied with by it prior to or on the Closing Date; provided, that, with respect to agreements, covenants and conditions that are qualified by materiality, Seller shall have performed such agreements, covenants and conditions, as so qualified, in all respects.

(g) No Action shall have been commenced against Buyer, Seller, Xxxxxxxx or the Company, which would prevent the Closing. No injunction or restraining order shall have been issued by any Governmental Authority, and be in effect, which restrains or prohibits any transaction contemplated hereby.

(h) All Required Consents shall be in form and content reasonably acceptable to Buyer, shall have been received, and executed counterparts thereof shall have been delivered to Buyer at or prior to the Closing.

(i) Since March 10, 2014, there shall not have occurred any Material Adverse Effect, nor shall any event or events have occurred that, individually or in the aggregate, with or without the lapse of time, could reasonably be expected to result in a Material Adverse Effect.

(j) The Transaction Documents (other than this Agreement) shall have been executed and delivered by the parties thereto and true and complete copies thereof shall have been delivered to Buyer.

(k) Buyer shall have received a certificate, dated the Closing Date and signed by a duly authorized officer of Seller, that each of the conditions set forth in Section 7.02(e) and Section 7.02(f) have been satisfied.

(l) Seller, Xxxxxxxx or the Company shall have obtained payoff letters, in forms reasonably satisfactory to Buyer with respect to the payoff amounts as of the Closing Date for the Indebtedness identified on Exhibit B and releases of any Encumbrances granted in connection with such Indebtedness held by third parties, indicating that upon payment of a specified amount (subject to per diem increase, if applicable), such holder shall release its Encumbrances and other security interests in, and agree to execute or authorize the execution of Uniform Commercial Code termination statements necessary to release of record its Encumbrances and other security interest in, the assets, properties and securities of Xxxxxxxx or the Company.

(m) Buyer shall have received a certificate of the Secretary or an Assistant Secretary (or equivalent officer) of Seller certifying that attached thereto are true and complete copies of all resolutions adopted by the board of directors of Seller authorizing the execution, delivery and performance of this Agreement and the other Transaction Documents and the consummation of the transactions contemplated hereby and thereby, and that all such resolutions are in full force and effect and are all the resolutions adopted in connection with the transactions contemplated hereby and thereby.

(n) Buyer shall have received a certificate of the Secretary or an Assistant Secretary (or equivalent officer) of Seller certifying the names and signatures of the officers of Seller authorized to sign this Agreement, the Transaction Documents and the other documents to be delivered hereunder and thereunder.

(o) Buyer shall have received resignations of the directors and officers of Xxxxxxxx and the Company pursuant to Section 5.04.

(p) Seller shall have delivered to Buyer a certificate of good standing and existence for Seller, Xxxxxxxx and the Company from the secretary of state or similar Governmental Authority of the jurisdiction under the Laws in which each is organized.

(q) Seller and the Company shall have obtained extensions or renewals of all leases of Real Property that have expired or which will expire within two (2) months of the Closing Date, in form and content reasonably acceptable to Buyer.

(r) Seller shall have delivered to Buyer a certificate in form and substance reasonably acceptable to Buyer pursuant to Treasury Regulations Section 1.1445-2(b) that Seller is not a foreign person within the meaning of Section 1445 of the Code.

(s) Seller shall have delivered, or caused to be delivered, to Buyer stock certificates evidencing the Shares, free and clear of Encumbrances, duly endorsed in blank or accompanied by stock powers or other instruments of transfer duly executed in blank and with all required stock transfer tax stamps affixed and stock certificates evidencing the Company Shares, free and clear of Encumbrances, evidencing Xxxxxxxx as the owner of the Company Shares.

(t) Seller shall have delivered to Buyer an executed copy of the pooling agreement reasonably acceptable to Seller that Buyer’s financing source requires Buyer and Seller to execute at Closing.

(u) Seller shall have delivered to Buyer such other documents or instruments as Buyer reasonably requests and are reasonably necessary to consummate the transactions contemplated by this Agreement.

Section 7.03. Conditions to Obligations of Seller. The obligations of Seller to consummate the transactions contemplated by this Agreement shall be subject to the fulfillment or Seller’s waiver, at or prior to the Closing, of each of the following conditions:

(a) The representations and warranties of Buyer contained in this Agreement and any certificate or other writing delivered pursuant hereto shall be true and correct in all respects (in the case of any representation or warranty qualified by materiality or Material Adverse Effect) or in all material respects (in the case of any representation or warranty not qualified by materiality or Material Adverse Effect) on and as of March 10, 2014, and on and as of the Closing Date with the same effect as though made at and as of such date (except those representations and warranties that address matters only as of a specified date, the accuracy of which shall be determined as of that specified date in all respects).

(b) Buyer shall have duly performed and complied in all material respects with all agreements, covenants and conditions required by this Agreement to be performed or complied with by it prior to or on the Closing Date; provided, that, with respect to agreements, covenants and conditions that are qualified by materiality, Buyer shall have performed such agreements, covenants and conditions, as so qualified, in all respects.

(c) No injunction or restraining order shall have been issued by any Governmental Authority, and be in effect, which restrains or prohibits any material transaction contemplated hereby.

(d) The Transaction Documents (other than this Agreement) shall have been executed and delivered by the parties thereto and true and complete copies thereof shall have been delivered to Seller.

(e) Seller shall have received a certificate, dated the Closing Date and signed by a duly authorized officer of Buyer, that each of the conditions set forth in Section 7.03(a) and Section 7.03(b) have been satisfied.

(f) Seller shall have received a certificate of the Secretary or an Assistant Secretary (or equivalent officer) of Buyer certifying that attached thereto are true and complete copies of all resolutions adopted by the board of directors of Buyer authorizing the execution, delivery and performance of this Agreement and the other Transaction Documents and the consummation of the transactions contemplated hereby and thereby, and that all such resolutions are in full force and effect and are all the resolutions adopted in connection with the transactions contemplated hereby and thereby.

(g) Seller shall have received a certificate of the Secretary or an Assistant Secretary (or equivalent officer) of Buyer certifying the names and signatures of the officers of Buyer authorized to sign this Agreement, the Transaction Documents and the other documents to be delivered hereunder and thereunder.

(h) Buyer shall have delivered to Seller such other documents or instruments as Seller reasonably requests and are reasonably necessary to consummate the transactions contemplated by this Agreement.

ARTICLE VIII.

Indemnification

Section 8.01. Survival. Subject to the limitations and other provisions of this Agreement, the representations and warranties contained herein (other than any representations or warranties contained in Section 3.22 the survivability of which are set forth in ARTICLE VI) shall survive the Closing and shall remain in full force and effect until the date that is eighteen (18) months from the Closing Date; provided, that the representations and warranties in Section 3.01, Section 3.03, Section 3.19, Section 3.20, Section 3.24, Section 3.27, Section 4.01, Section 4.04 and claims for fraud shall survive for the full period of all applicable statutes of limitations

(giving effect to any waiver, mitigation or extension thereof). All covenants and agreements of the parties contained herein (other than any covenants or agreements contained in ARTICLE VI the survivability of which are set forth in ARTICLE VI) shall survive the Closing indefinitely or for the period contemplated by its terms. Notwithstanding the foregoing, any claims asserted in good faith with reasonable specificity (to the extent known at such time) and in writing by notice from the non-breaching party to the breaching party prior to the expiration date of the applicable survival period shall not thereafter be barred by the expiration of such survival period and such claims shall survive until finally resolved.

Section 8.02. Indemnification By Seller. Subject to the other terms and conditions of this ARTICLE VIII, Seller shall indemnify and defend each of Buyer and its Affiliates (including Xxxxxxxx and the Company) and their respective Representatives (collectively, the “Buyer Indemnitees”) against, and shall hold each of them harmless from and against, and shall pay and reimburse each of them for, any and all Losses incurred or sustained by, or imposed upon, the Buyer Indemnitees based upon, arising out of, with respect to or by reason of:

(a) any inaccuracy in or breach of any of the representations or warranties of Seller contained in this Agreement or in any certificate or instrument delivered by or on behalf of Seller pursuant to this Agreement as of the date such representation or warranty was made or as if such representation or warranty was made on and as of the Closing Date (except for representations and warranties that expressly relate to a specified date, the inaccuracy in or breach of which will be determined with reference to such specified date);

(b) any breach or non-fulfillment of any covenant, agreement or obligation to be performed by Seller pursuant to this Agreement;

(c) the matters disclosed in the following sections of the Disclosure Schedules: Section 3.17(a), Section 3.19, Section 3.19(b), Section 3.19(f), Section 3.19(h) and Section 3.21(c); or

(d) any Losses arising from an Environmental Claims related to any storage tank which was conveyed or loaned by the Company to a customer prior to the Closing.

Section 8.03. Indemnification By Buyer. Subject to the other terms and conditions of this ARTICLE VIII, Buyer shall indemnify and defend each of Seller and its Affiliates and their respective Representatives (collectively, the “Seller Indemnitees”) against, and shall hold each of them harmless from and against, and shall pay and reimburse each of them for, any and all Losses incurred or sustained by, or imposed upon, the Seller Indemnitees based upon, arising out of, with respect to or by reason of:

(a) any inaccuracy in or breach of any of the representations or warranties of Buyer contained in this Agreement or in any certificate or instrument delivered by or on behalf of Buyer pursuant to this Agreement, as of the date such representation or warranty was made or as if such representation or warranty was made on and as of the Closing Date (except for representations and warranties that expressly relate to a specified date, the inaccuracy in or breach of which will be determined with reference to such specified date);

(b) any breach or non-fulfillment of any covenant, agreement or obligation to be performed by Buyer pursuant to this Agreement (other than ARTICLE VI, it being understood that the sole remedy for any such breach thereof shall be pursuant to ARTICLE VI); or

(c) Seller being required to pay amounts related to indemnification of the obligations of the Company under the Listed Indemnification Agreements with respect to the Interim Guaranteed Bonds.

If Buyer receives an indemnification payment from Seller under Section 8.02 in connection with a breach of the representation contained in Section 3.14(c) and Buyer or the Company subsequently receives payment on account of the relevant accounts receivable(s), Buyer shall reimburse to Seller the amount so received on account of the relevant accounts receivable(s).

Section 8.04. Certain Limitations. The indemnification provided for in Section 8.02 and Section 8.03 shall be subject to the following limitations:

(a) Seller shall not be liable to the Buyer Indemnitees for indemnification under Section 8.02(a) until the aggregate amount of all Losses in respect of indemnification under Section 8.02(a) exceeds $1,000,000 (the “Basket”), in which event Seller shall be required to pay or be liable for all such Losses that exceed the Basket. The aggregate amount of all Losses for which Seller shall be liable pursuant to Section 8.02(a) shall not exceed $17,500,000 (the “Cap”).

(b) Seller shall not be liable to the Buyer Indemnitees for indemnification under Section 8.02(a) in respect of any inaccuracy in or breach of the representation and warranty set out in Section 3.14(c) until the aggregate amount of all Losses in respect of such inaccuracy or breach exceeds $200,000, in which event Seller shall be required to pay or be liable for all such Losses that exceed $200,000.

(c) Buyer shall not be liable to the Seller Indemnitees for indemnification under Section 8.03(a) until the aggregate amount of all Losses in respect of indemnification under Section 8.03(a) exceeds the Basket, in which event Buyer shall be required to pay or be liable for all such Losses that exceed the Basket. The aggregate amount of all Losses for which Buyer shall be liable pursuant to Section 8.03(a) shall not exceed the Cap. Notwithstanding the foregoing, the limitations in this Section 8.04(c) shall not apply to any Seller Losses indemnifiable pursuant to Section 8.03(c).

(d) Notwithstanding the foregoing, the limitations as to the Basket and Cap set forth in Section 8.04(a) and Section 8.04(b) shall not apply to Losses based upon, arising out of, with respect to or by reason of (i) any inaccuracy in or breach of any representation or warranty in Section 3.01, Section 3.03, Section 3.19, Section 3.20, Section 3.24, Section 3.27, Section 4.01 and Section 4.04 which shall be capped at the Purchase Price or (ii) claims for fraud or criminal or intentional conduct which shall not be subject to the Basket or Cap.

(e) Payments by an Indemnifying Party pursuant to Section 8.02 and Section 8.03 in respect of any Loss shall be limited to the amount of any liability or damage that remains after deducting therefrom any insurance proceeds and any indemnity, contribution or other similar payment received by the Indemnified Party (or Xxxxxxxx or the Company) in respect of any

such claim. The Indemnified Party shall use its commercially reasonable efforts to recover under insurance policies or indemnity, contribution or other similar agreements for any Losses prior to seeking indemnification under this Agreement. Notwithstanding the foregoing or anything else in this Agreement to the contrary, if Buyer, Xxxxxxxx or the Company collects insurance proceeds related to Xxxxx Cross Utah Losses but is thereafter unable to collect insurance proceeds for an otherwise covered matter (the “Uncollectable Amount”) because insurance policy limits were met or exceeded by reason of claims made relating to Xxxxx Cross Utah Losses, Seller shall reimburse Buyer for the full amount of the Uncollectable Amount

(f) Payments by an Indemnifying Party pursuant to Section 8.02 and Section 8.03 in respect of any Loss shall be reduced by an amount equal to any Tax benefit realized as a result of such Loss by the Indemnified Party.

(g) Each Indemnified Party shall take, and cause its Affiliates to take, all reasonable steps to mitigate any Loss upon becoming aware of any event or circumstance that would be reasonably expected to, or does, give rise thereto, including incurring costs only to the minimum extent necessary to remedy the breach that gives rise to such Loss.

(h) Except in the case of fraud or to the extent actually awarded to a Governmental Authority or other third party, in no event shall any Indemnifying Party be liable to any Indemnified Party for any punitive damages or for any special or indirect damages for loss of future revenue or income, loss of business reputation or loss of opportunity relating to a breach or alleged breach of this Agreement or damages based on any type of multiple.

(i) Notwithstanding the foregoing or anything else in this Agreement to the contrary, the limitations as to the Basket and Cap set forth in Section 8.04(a) above shall not apply to Xxxxx Cross Utah Losses and Seller shall be responsible for all Xxxxx Cross Utah Losses indefinitely notwithstanding the survivability periods set forth in Section 8.01. With respect to the Xxxxx Cross Utah Losses, Buyer shall use reasonable efforts to avoid duplication of costs and to use only one counsel as much as reasonably possible, except nothing herein shall prevent Buyer from hiring outside environmental counsel and retaining local counsel in Utah in addition to Buyer’s regular outside legal counsel.

(j) Notwithstanding the foregoing or anything else in this Agreement to the contrary, the limitations as to the Basket and Cap set forth in Section 8.04(a) above shall not apply to indemnification arising under Section 8.02(d) above.

Section 8.05. Indemnification Procedures. The party making a claim under this ARTICLE VIII is referred to as the “Indemnified Party”, and the party against whom such claims are asserted under this ARTICLE VIII is referred to as the “Indemnifying Party”.

(a) Third Party Claims. If any Indemnified Party receives notice of the assertion or commencement of any Action made or brought by any Person who is not a party to this Agreement or an Affiliate of a party to this Agreement or a Representative of the foregoing (a “Third Party Claim”) against such Indemnified Party with respect to which the Indemnifying Party is obligated to provide indemnification under this Agreement, the Indemnified Party shall give the Indemnifying Party reasonably prompt written notice thereof, but in any event not later

than thirty (30) calendar days after receipt of such notice of such Third Party Claim. The failure to give such prompt written notice shall not, however, relieve the Indemnifying Party of its indemnification obligations, except and only to the extent that the Indemnifying Party forfeits rights or defenses by reason of such failure. Such notice by the Indemnified Party shall describe the Third Party Claim in reasonable detail, shall include copies of all material written evidence thereof and shall indicate the estimated amount, if reasonably practicable, of the Loss that has been or may be sustained by the Indemnified Party. The Indemnifying Party shall have the right to participate in, or by giving written notice to the Indemnified Party, to assume the defense of any Third Party Claim at the Indemnifying Party’s expense and by the Indemnifying Party’s own counsel, and the Indemnified Party shall cooperate in good faith in such defense; provided, that if the Indemnifying Party is Seller, such Indemnifying Party shall not have the right to defend or direct the defense of any such Third Party Claim that (x) is asserted directly by or on behalf of a Person that is a supplier or customer of the Company, or (y) seeks an injunction or other equitable relief against the Indemnified Party. In the event that the Indemnifying Party assumes the defense of any Third Party Claim, subject to Section 8.05(b), it shall have the right to take such action as it deems necessary to avoid, dispute, defend, appeal or make counterclaims pertaining to any such Third Party Claim in the name and on behalf of the Indemnified Party. The Indemnified Party shall have the right to participate in the defense of any Third Party Claim with counsel selected by it subject to the Indemnifying Party’s right to control the defense thereof. The fees and disbursements of such counsel shall be at the expense of the Indemnified Party, provided, that if in the reasonable opinion of counsel to the Indemnified Party, (A) there are legal defenses available to an Indemnified Party that are different from or additional to those available to the Indemnifying Party; or (B) there exists a conflict of interest between the Indemnifying Party and the Indemnified Party that cannot be waived, the Indemnifying Party shall be liable for the reasonable fees and expenses of counsel to the Indemnified Party in each jurisdiction for which the Indemnified Party determines counsel is required. If the Indemnifying Party elects not to compromise or defend such Third Party Claim, fails to promptly notify the Indemnified Party in writing of its election to defend as provided in this Agreement, or fails to diligently prosecute the defense of such Third Party Claim, the Indemnified Party may, subject to Section 8.05(b), pay, compromise, defend such Third Party Claim and seek indemnification for any and all Losses based upon, arising from or relating to such Third Party Claim. Seller and Buyer shall cooperate with each other in all reasonable respects in connection with the defense of any Third Party Claim, including making available (subject to the provisions of Section 5.11) records relating to such Third Party Claim and furnishing, without expense (other than reimbursement of actual out-of-pocket expenses) to the defending party, management employees of the non-defending party as may be reasonably necessary for the preparation of the defense of such Third Party Claim.

(b) Settlement of Third Party Claims. Notwithstanding any other provision of this Agreement, the Indemnifying Party shall not enter into settlement of any Third Party Claim without the prior written consent of the Indemnified Party, except as provided in this Section 8.05(b). If a firm offer is made to settle a Third Party Claim without leading to liability or the creation of a financial or other obligation on the part of the Indemnified Party and provides, in customary form, for the unconditional release of each Indemnified Party from all liabilities and obligations in connection with such Third Party Claim and the Indemnifying Party desires to accept and agree to such offer, the Indemnifying Party shall give written notice to that effect to the Indemnified Party. If the Indemnified Party fails to consent to such firm offer within ten (10)

days after its receipt of such notice, the Indemnified Party may continue to contest or defend such Third Party Claim and in such event, the maximum liability of the Indemnifying Party as to such Third Party Claim shall not exceed the amount of such settlement offer. If the Indemnified Party fails to consent to such firm offer and also fails to assume defense of such Third Party Claim, the Indemnifying Party may settle the Third Party Claim upon the terms set forth in such firm offer to settle such Third Party Claim. If the Indemnified Party has assumed the defense pursuant to Section 8.05(a), it shall not agree to any settlement without the written consent of the Indemnifying Party (which consent shall not be unreasonably withheld or delayed).

(c) Direct Claims. Any Action by an Indemnified Party on account of a Loss which does not result from a Third Party Claim (a “Direct Claim”) shall be asserted by the Indemnified Party giving the Indemnifying Party reasonably prompt written notice thereof, but in any event not later than thirty (30) days after the Indemnified Party becomes aware of such Direct Claim. The failure to give such prompt written notice shall not, however, relieve the Indemnifying Party of its indemnification obligations, except and only to the extent that the Indemnifying Party forfeits rights or defenses by reason of such failure. Such notice by the Indemnified Party shall describe the Direct Claim in reasonable detail, shall include copies of all material written evidence thereof and shall indicate the estimated amount, if reasonably practicable, of the Loss that has been or may be sustained by the Indemnified Party. The Indemnifying Party shall have fifteen (15) days after its receipt of such notice to respond in writing to such Direct Claim. The Indemnified Party shall allow the Indemnifying Party and its professional advisors to investigate the matter or circumstance alleged to give rise to the Direct Claim, and whether and to what extent any amount is payable in respect of the Direct Claim and the Indemnified Party shall assist the Indemnifying Party’s investigation by giving such information and assistance (including access to the Company’s premises and personnel and the right to examine and copy any accounts, documents or records) as the Indemnifying Party or any of its professional advisors may reasonably request. If the Indemnifying Party does not so respond within such thirty (30) day period, the Indemnifying Party shall be deemed to have rejected such claim, in which case the Indemnified Party shall be free to pursue such remedies as may be available to the Indemnified Party on the terms and subject to the provisions of this Agreement.

Section 8.06. Payments. Subject to Section 2.05 above, once a Loss is agreed to by the Indemnifying Party or finally adjudicated to be payable pursuant to this ARTICLE VIII, the Indemnifying Party shall satisfy its obligations within fifteen (15) Business Days of such final, non-appealable adjudication by wire transfer of immediately available funds. The parties hereto agree that should an Indemnifying Party not make full payment of any such obligations within such fifteen (15) Business Day period, any amount payable shall accrue interest from and including the date of agreement of the Indemnifying Party or final, non-appealable adjudication to the date such payment has been made at a rate per annum equal to six percent. Such interest shall be calculated daily on the basis of a three hundred sixty-five (365) day year and the actual number of days elapsed.

Section 8.07. Tax Treatment of Indemnification Payments. All indemnification payments made under this Agreement shall be treated by the parties as an adjustment to the Purchase Price for Tax purposes, unless otherwise required by Law.

Section 8.08. Exclusive Remedies. Subject to Section 5.12 and Section 10.11, the parties acknowledge and agree that their sole and exclusive remedy with respect to any and all claims (other than claims arising from fraud, criminal activity or willful misconduct on the part of a party hereto in connection with the transactions contemplated by this Agreement) for any breach of any representation, warranty, covenant, agreement or obligation set forth herein or otherwise relating to the subject matter of this Agreement, shall be pursuant to the indemnification provisions set forth in ARTICLE VI and this ARTICLE VIII. In furtherance of the foregoing, each party hereby waives, to the fullest extent permitted under Law, any and all rights, claims and Action for any breach of any representation, warranty, covenant, agreement or obligation set forth herein or otherwise relating to the subject matter of this Agreement it may have against the other parties hereto and their Affiliates and each of their respective Representatives arising under or based upon any Law, except pursuant to the indemnification provisions set forth in ARTICLE VI and this ARTICLE VIII. Nothing in this Section 8.08 shall limit any Person’s right to seek and obtain any equitable relief to which any Person shall be entitled or to seek any remedy on account of any party’s fraudulent, criminal or intentional misconduct.

ARTICLE IX.

Termination

Section 9.01. Termination. This Agreement may be terminated at any time prior to the Closing:

(a) by the mutual written consent of Seller and Buyer;

(b) by Buyer by written notice to Seller if:

(i) Buyer is not then in material breach of any provision of this Agreement and there has been a breach, inaccuracy in or failure to perform any representation, warranty, covenant or agreement made by Seller pursuant to this Agreement that would give rise to the failure of any of the conditions specified in ARTICLE VII and such breach, inaccuracy or failure has not been cured by Seller by the Drop Dead Date;

(ii) any of the conditions set forth in Section 7.01 or Section 7.02 shall not have been, or if it becomes apparent that any of such conditions will not be, fulfilled by the Drop Dead Date, unless such failure shall be due to the failure of Buyer to perform or comply with any of the covenants, agreements or conditions hereof to be performed or complied with by it prior to the Closing;

(iii) if the conditions set forth in Section 5.03(b) permit termination by Buyer; or

(iv) if the conditions set forth in Section 5.03(c) permit termination by Buyer;

(i) Seller is not then in material breach of any provision of this Agreement and there has been a breach, inaccuracy in or failure to perform any representation, warranty,

covenant or agreement made by Buyer pursuant to this Agreement that would give rise to the failure of any of the conditions specified in ARTICLE VII and such breach, inaccuracy or failure has not been cured by Buyer within five (5) days of Buyer’s receipt of written notice of such breach from Seller; or

(ii) any of the conditions set forth in Section 7.01 or Section 7.03 shall not have been, or if it becomes apparent that any of such conditions will not be, fulfilled by the Drop Dead Date, unless such failure shall be due to the failure of Seller to perform or comply with any of the covenants, agreements or conditions hereof to be performed or complied with by it prior to the Closing; or

(d) by Buyer or Seller in the event that (i) there shall be any Law that makes consummation of the transactions contemplated by this Agreement illegal or otherwise prohibited or (ii) any Governmental Authority shall have issued a Governmental Order restraining or enjoining the transactions contemplated by this Agreement, and such Governmental Order shall have become final and non-appealable.

Section 9.02. Effect of Termination. In the event this Agreement is terminated pursuant to:

(a) subparagraph (a), (b)(iii), or (d) of Section 9.01, then no party will have any liability to any other party;

(b) subparagraph (b)(i), (b)(ii), or (b)(iv) of Section 9.01, Buyer shall be entitled to pursue, exercise and enforce any and all remedies, rights, powers and privileges available at law or in equity;

(c) subparagraph (c)(i) or (c)(ii) of Section 9.01, Seller shall be entitled to pursue, exercise and enforce any and all remedies, rights, powers and privileges available at law or in equity.

(d) In the event of Seller’s breach, or threatened breach, of any provision contained in this Agreement, Buyer shall be entitled to the right of specific performance and/or both temporary and permanent injunctive relief in addition to but not in lieu of any other remedies available at law or in equity. In addition to the provisions set forth above, in the event of the termination of this Agreement in accordance with this Article, this Agreement shall forthwith become void; provided this Section and Section 5.11 and ARTICLE X shall survive such termination. Additionally, nothing herein shall relieve any party hereto from liability for any willful breach of any provision hereof.

Section 9.03. Termination Payment.

(a) Notwithstanding any other provision in this Agreement relating to the payment of fees and expenses, and provided Seller is not in material default in the performance of its obligations under this Agreement, if this Agreement is terminated by reason of Buyer’s condition in Section 7.02(d) not being satisfied on or before the Drop Dead Date, and the failure of that condition precedent to be satisfied by such date was not the result of any material breach, inaccuracy in or failure to perform any representation, warranty, covenant or agreement made by

Seller pursuant to this Agreement, or the result of Seller, Xxxxxxxx or the Company taking any material action prohibited by this Agreement or failing to take any material action required by this Agreement, then Buyer shall pay or cause to be paid to Seller an amount equal to the sum of $500,000 within two (2) Business Days of such termination, by bank draft or wire transfer of immediately available funds to an account designated by Seller, net of any Taxes required to be withheld from such payment.

(b) The parties acknowledges that the agreements contained in this Section 9.03 are an integral part of the transactions contemplated by this Agreement and that, without those agreements, the parties would not enter into this Agreement. Each party acknowledges that the payment amount set out in Section 9.03(a) is a payment of liquidated damages which is a genuine pre-estimate of the damages Seller will suffer or incur as a result of the event giving rise to such payment and the resultant termination of this Agreement and are not penalties. The parties irrevocably waive any right they may have to raise as a defense that any such liquidated damages are excessive or punitive, and the payment shall be in lieu of any other liabilities or damages in respect of this Agreement and the transactions contemplated hereby.

ARTICLE X.

Miscellaneous

Section 10.01. Expenses. Except as otherwise expressly provided herein, all costs and expenses, including fees and disbursements of counsel, financial advisors and accountants, incurred in connection with this Agreement and the transactions contemplated hereby shall be paid by the party incurring such costs and expenses, whether or not the Closing shall have occurred; provided, however, Seller shall pay all amounts payable to Xxxxxxxx Xxxxx.

Section 10.02. Notices. All notices, requests, consents, claims, demands, waivers and other communications hereunder shall be in writing and shall be deemed to have been given (a) when delivered by hand (with written confirmation of receipt); (b) when received by the addressee if sent by a nationally recognized overnight courier (receipt requested); (c) on the date sent by facsimile or e-mail of a PDF document (with confirmation of transmission) if sent during normal business hours of the recipient, and on the next Business Day if sent after normal business hours of the recipient or (d) on the third day after the date mailed, by certified or registered mail, return receipt requested, postage prepaid. Such communications must be sent to the respective parties at the following addresses (or at such other address for a party as shall be specified in a notice given in accordance with this Section 10.02):


If to Seller:		Nuverra Environmental Solutions, Inc. 00000 Xxxxx Xxxxxxxxxx Xxxx, Xxxxx 000 Xxxxxxxxxx, Xxxxxxx 00000 Facsimile: 602.903.7806 Email: xxxx.xxxxxxxx@xxxxxxx.xxx Attention: Chief Executive Officer

with a copy to:		Nuverra Environmental Solutions, Inc. Attention: Xxx Xxxxxxxxx, Chief Financial


		Officer and Xxx Xxxxx, Chief Legal Officer 00000 Xxxxx Xxxxxxxxxx Xxxx, Xxxxx 000 Xxxxxxxxxx, Xxxxxxx 00000 Facsimile: 602.903.7806 Email: xxx.xxxxxxxxx@xxxxxxx.xxx Email: xxx.xxxxx@xxxxxxx.xxx

and a copy to:		Squire Xxxxxx Xxxxx (US) LLP Attention: Xxxxxxx X. Xxxxxx and Xxxxx Xxxxxxx Xxxxxxx 0 X. Xxxxxxxxxx Xxxxxx, Xxxxx 0000 Xxxxxxx, Xxxxxxx 00000 Facsimile: 602.253.8129 Email: xxxxxxx.xxxxxx@xxxxxxxx.xxx Email: xxxxx.xxxxxxx@xxxxxxxx.xxx

If to the Company or Xxxxxxxx:		Thermo Fluids, Inc. 0000 Xxxx Xxxx Xxxxxx Xxxxxxx, Xxx. 000 Xxxxxxxxxx, Xxxxxxx 00000 Facsimile: 000.000.0000 Email: xxx.xxxxxxxx@xxxxxxxxxxxx.xxx Attention: Chief Operating Officer

with a copy to:		Nuverra Environmental Solutions, Inc. 00000 Xxxxx Xxxxxxxxxx Xxxx, Xxxxx 000 Xxxxxxxxxx, Xxxxxxx 00000 Facsimile: 602.903.7806 Email: xxx.xxxxx@xxxxxxx.xxx Attention: Chief Legal Officer

If to Buyer:		VeroLube USA, Inc. 0000 Xxxxxxx Xxxxxx, Xxxxx 000 Xxxxx, Xxxxx 00000 Facsimile: (000) 000-0000 Email: xxx@xxxxxxxx.xxx Attention: Xxxxxx Xxxx

with a copy to:		Xxxxxxx X. Xxxxxxx, Esq. Xxxxxxx Xxxxxx L.L.P. 000 Xxxx Xxxxxx, Xxxxx 0000 Xxxxxx, Xxxxx 00000 Facsimile: (000) 000-0000 Email: xxxxxxxx@xx.xxx

and a copy to:

Xxxxxx Deutsch

XxXxxxxx LLP

Royal Centre, 0000 Xxxx Xxxxxxx Xxxxxx

Xxxxx 0000, XX Xxx 00000

Xxxxxxxxx, XX X0X 0X0

Facsimile: (000) 000-0000

Email: xxxxxx.xxxxxxx@xxxxxxxx.xx

Section 10.03. Interpretation. For purposes of this Agreement, (a) the words “include,” “includes” and “including” shall be deemed to be followed by the words “without limitation”; (b) the word “or” is not exclusive; and (c) the words “herein,” “hereof,” “hereby,” “hereto” and “hereunder” refer to this Agreement as a whole. Unless the context otherwise requires, references herein: (x) to Articles, Sections, Disclosure Schedules and Exhibits mean the Articles and Sections of, and Disclosure Schedules and Exhibits attached to, this Agreement; (y) to an agreement, instrument or other document means such agreement, instrument or other document as amended, supplemented and modified from time to time to the extent permitted by the provisions thereof and (z) to a statute means such statute as amended from time to time and includes any successor legislation thereto and any regulations promulgated thereunder. This Agreement shall be construed without regard to any presumption or rule requiring construction or interpretation against the party drafting an instrument or causing any instrument to be drafted. The Disclosure Schedules and Exhibits referred to herein shall be construed with, and as an integral part of, this Agreement to the same extent as if they were set forth verbatim herein.

Section 10.04. Headings. The headings in this Agreement are for reference only and shall not affect the interpretation of this Agreement.

Section 10.05. Severability. If any term or provision of this Agreement is invalid, illegal or unenforceable in any jurisdiction, such invalidity, illegality or unenforceability shall not affect any other term or provision of this Agreement or invalidate or render unenforceable such term or provision in any other jurisdiction. Except as provided in Section 5.12(d), upon such determination that any term or other provision is invalid, illegal or unenforceable, the parties hereto shall negotiate in good faith to modify this Agreement so as to effect the original intent of the parties as closely as possible in a mutually acceptable manner in order that the transactions contemplated hereby be consummated as originally contemplated to the greatest extent possible.

Section 10.06. Entire Agreement. This Agreement, the other Transaction Documents and the Confidentiality Agreement constitute the sole and entire agreement of the parties to this Agreement with respect to the subject matter contained herein and therein, and supersede all prior and contemporaneous representations, warranties, understandings and agreements, both written and oral, with respect to such subject matter. In the event of any inconsistency between the statements in the body of this Agreement and those in the other Transaction Documents, the Exhibits and Disclosure Schedules (other than an exception expressly set forth as such in the Disclosure Schedules), the statements in the body of this Agreement will control.

Section 10.07. Successors and Assigns. This Agreement shall be binding upon and shall inure to the benefit of the parties hereto and their respective successors and permitted assigns. Neither party may assign its rights or obligations hereunder without the prior written consent of the other party, which consent shall not be unreasonably withheld or delayed; provided, however, that prior to the Closing Date, Buyer may, without the prior written consent of Seller, assign all or any portion of its rights under this Agreement to one or more of its direct or indirect wholly-owned subsidiaries. No assignment shall relieve the assigning party of any of its obligations hereunder.

Section 10.08. No Third-party Beneficiaries. Except as provided in Section 6.03 and ARTICLE VIII, this Agreement is for the sole benefit of the parties hereto and their respective successors and permitted assigns and nothing herein, express or implied, is intended to or shall confer upon any other Person or entity any legal or equitable right, benefit or remedy of any nature whatsoever under or by reason of this Agreement.

Section 10.09. Amendment and Modification; Waiver. This Agreement may only be amended, modified or supplemented by an agreement in writing signed by each party hereto. No waiver by any party of any of the provisions hereof shall be effective unless explicitly set forth in writing and signed by the party so waiving. No waiver by any party shall operate or be construed as a waiver in respect of any failure, breach or default not expressly identified by such written waiver, whether of a similar or different character, and whether occurring before or after that waiver. No failure to exercise, or delay in exercising, any right, remedy, power or privilege arising from this Agreement shall operate or be construed as a waiver thereof; nor shall any single or partial exercise of any right, remedy, power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege.

Section 10.10. Governing Law; Submission to Jurisdiction; Waiver of Jury Trial.

(a) This Agreement and any claim, controversy or dispute arising out of or related to this Agreement, the other Transaction Documents or any of the transactions contemplated hereby or thereby, the relationship of the parties, and/or the interpretation and enforcement of the rights and duties of the parties, whether arising in contract, tort, equity or otherwise, shall be governed by, and construed in accordance with, the laws of the State of Delaware (including in respect of the statute of limitations or other limitations period applicable to any such claim, controversy or dispute), without regard to any applicable principles of conflicts of law that might require the application of the laws of any other jurisdiction.

(b) IN ANY ACTION OR PROCEEDING BETWEEN ANY OF THE PARTIES ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE OTHER TRANSACTION DOCUMENTS OR ANY OF THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY, EACH OF THE PARTIES: (I) IRREVOCABLY AND UNCONDITIONALLY CONSENTS AND SUBMITS TO THE EXCLUSIVE JURISDICTION AND VENUE OF THE COURT OF CHANCERY OF THE STATE OF DELAWARE OR, TO THE EXTENT SUCH COURT DOES NOT HAVE SUBJECT MATTER JURISDICTION, THE SUPERIOR COURT OF THE STATE OF DELAWARE OR THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF DELAWARE, (II) AGREES THAT ALL CLAIMS IN RESPECT OF SUCH ACTION OR PROCEEDING SHALL BE HEARD AND DETERMINED EXCLUSIVELY IN

ACCORDANCE WITH CLAUSE (I) OF THIS SECTION, (III) WAIVES ANY OBJECTION TO LAYING VENUE IN ANY SUCH ACTION OR PROCEEDING IN SUCH COURTS, (IV) WAIVES ANY OBJECTION THAT SUCH COURTS ARE AN INCONVENIENT FORUM OR DO NOT HAVE JURISDICTION OVER ANY PARTY, AND (V) AGREES THAT SERVICE OF PROCESS UPON SUCH PARTY IN ANY SUCH ACTION OR PROCEEDING SHALL BE EFFECTIVE IF SUCH PROCESS IS GIVEN BY MAIL IN ACCORDANCE WITH Section 10.02 OF THIS AGREEMENT.

(c) EACH PARTY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH MAY ARISE UNDER THIS AGREEMENT OR THE OTHER TRANSACTION DOCUMENTS IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES AND, THEREFORE, EACH SUCH PARTY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LEGAL ACTION ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE OTHER TRANSACTION DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY. EACH PARTY TO THIS AGREEMENT CERTIFIES AND ACKNOWLEDGES THAT (A) NO REPRESENTATIVE OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT SEEK TO ENFORCE THE FOREGOING WAIVER IN THE EVENT OF A LEGAL ACTION, (B) SUCH PARTY HAS CONSIDERED THE IMPLICATIONS OF THIS WAIVER, (C) SUCH PARTY MAKES THIS WAIVER VOLUNTARILY, AND (D) SUCH PARTY HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 10.10(c).

Section 10.11. Specific Performance. The parties agree that irreparable damage would occur if any provision of this Agreement were not performed in accordance with the terms hereof and that the parties shall be entitled to specific performance of the terms hereof, in addition to any other remedy to which they are entitled at law or in equity.

Section 10.12. Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which together shall be deemed to be one and the same agreement. A signed copy of this Agreement delivered by facsimile, e-mail or other means of electronic transmission shall be deemed to have the same legal effect as delivery of an original signed copy of this Agreement.

Section 10.13. Non-recourse. This Agreement may only be enforced against, and any claim, action, suit or other legal proceeding based upon, arising out of, or related to this Agreement, or the negotiation, execution or performance of this Agreement, may only be brought against the entities that are expressly named as parties hereto and then only with respect to the specific obligations set forth herein with respect to such party. No past, present or future director, officer, employee, incorporator, manager, member, partner, stockholder, Affiliate, agent, attorney or other Representative of any party hereto or of any Affiliate of any party hereto, or any of their successors or permitted assigns, shall have any liability for any obligations or liabilities of any party hereto under this Agreement or for any claim or Action based on, in respect of or by reason of the transactions contemplated hereby.

Section 10.14. Express Agreement to Create a Sealed Instrument. The parties hereby acknowledge and agree that, to the fullest extent permitted by law, they intend that this Agreement be, and that it will be treated and construed as, a contract under seal under Delaware law with all of the consequences of such a contract under Delaware law, including causing the Agreement to be subject to the twenty (20)-year limitations period applicable to sealed instruments; provided, however, that the parties hereto agree that, notwithstanding the application of such longer limitations period under Delaware law, the parties hereby agree that the applicable limitations period for all claims arising out of or relating to this Agreement shall be those periods set forth in ARTICLE VIII.

[SIGNATURE PAGE FOLLOWS]

IN WITNESS WHEREOF, the parties hereto have affixed their signatures and seals on the date first written above by their respective officers thereunto duly authorized.


ATTEST/WITNESS:	NUVERRA ENVIRONMENTAL SOLUTIONS, INC. (SEAL)

/s/ Xxxxxx X. Xxxxx	By:	/s/ Xxxx X. Xxxxxxxx
Name: Xxxxxx X. Xxxxx	Name: Xxxx X. Xxxxxxxx Title: Chief Executive Officer and Vice-Chairman

ATTEST/WITNESS:	VEROLUBE USA, INC. (SEAL)

/s/ Xxxxx Xxxx	By:	/s/ Xxxxxx Xxxx
Name: Xxxxx Xxxx	Name: Xxxxxx Xxxx Title: Director

EXHIBIT A

Amended and Restated Form of Escrow Agreement

(See attached document)

Exhibit A

EXHIBIT B

Indebtedness to be paid at Closing

All Indebtedness of Xxxxxxxx and the Company under or in connection with that certain Amended and Restated Credit Agreement, dated February 3, 2014, by and among Nuverra Environmental Solutions, Inc., a Delaware corporation, as borrower; Xxxxx Fargo Bank, National Association, a national banking association (“Xxxxx Fargo”), as administrative agent; Xxxxx Fargo, Bank of America, N.A., a national banking association (“Bank of America”), and RBS Citizens, N.A., a national banking association (“RBS Citizens”), as joint lead arrangers; Xxxxx Fargo, Bank of America and RBS Citizens, as joint book runners; Bank of America and RBS Citizens, as co-syndication agents; and Xxxxx Fargo, Bank of America and Citizens Bank of Pennsylvania, as lenders.

Exhibit B

EXHIBIT C

Format for Calculation of Estimated Closing Working Capital


[A]		Estimated Working Capital	$
		[B] - [C]

[B]		Current Assets¹	$
		[i] + [ii] + [iii] + [iv] + [v] + [vi] + [vii]

	[i]	Cash and cash equivalents

	[ii]	Net accounts receivables

	[iii]	Net inventory

	[iv]	Prepaid assets

	[v]	Prepaid insurance

	[vi]	Prepaid holdings

	[vii]	Other current assets

[C]		Current Liabilities²	$
		[viii] + [ix] + [x] + [xi] + [xii]

	[viii]	Accounts payables

	[ix]	Accrued payroll expenses

	[x]	Accrued property taxes

	[xi]	Accrued sales tax

	[xii]	Other accrued expenses

¹	For greater certainty, current assets included in this calculation shall not include the exclusions identified in the definition on “Current Assets” in Article 1.

²	For greater certainty, current liabilities included in this calculation shall not include the exclusions identified in the definition on “Current Liabilities” in Article 1.

Exhibit D

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Table of Contents

AMENDED AND RESTATED STOCK PURCHASE AGREEMENT BETWEEN NUVERRA ENVIRONMENTAL SOLUTIONS, INC. AND VEROLUBE USA, INC. DATED AS OF June 24, 2014

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