AMENDED AND RESTATED ASSET AND STOCK PURCHASE AGREEMENT dated as of January 30, 2015 between EMERSON ELECTRIC CO. and REGAL BELOIT CORPORATION

Exhibit 2.1

EXECUTION VERSION

AMENDED AND RESTATED

ASSET AND STOCK PURCHASE AGREEMENT

dated as of

January 30, 2015

between

EMERSON ELECTRIC CO.

and

REGAL BELOIT CORPORATION

TABLE OF CONTENTS

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AMENDED AND RESTATED

ASSET AND STOCK PURCHASE AGREEMENT

AGREEMENT (this “Agreement”) dated as of January 30, 2015 between Emerson Electric Co., a Missouri corporation (“Seller”), and Regal Beloit Corporation, a Wisconsin corporation (“Buyer”).

W I T N E S S E T H :

WHEREAS, Seller, together with its Subsidiaries, owns and operates the Business (as defined below);

WHEREAS, Buyer and Seller are party to that certain Asset and Stock Purchase Agreement dated as of December 13, 2014 (the “Original Agreement”) pursuant to which Buyer agreed to purchase the Shares (as defined below) and the Purchased Assets (as defined below) and assume the Assumed Liabilities (as defined below) from Seller and its Subsidiaries, and Seller and its Subsidiaries agreed to sell the Shares and the Purchased Assets and transfer the Assumed Liabilities to Buyer, upon the terms and subject to the conditions set forth therein; and

WHEREAS, Buyer and Seller desire to amend and restate the Original Agreement in its entirety upon the terms and subject to the conditions set forth herein.

NOW, THEREFORE, the parties hereto agree as follows:

ARTICLE 1
Definitions

Section 1.01.            Definitions.  (a) As used herein, the following terms have the following meanings:

“1934 Act” means the Securities Exchange Act of 1934.

“Accounting Policies and Modified Net Asset Value Schedule” means the schedule setting forth the determination of Modified Net Asset Value and the accounting policies, principles, practices and methodologies, in each case, as set forth in Schedule I.

“Action” means any action, suit, investigation or proceeding, in each case, by or before any arbitrator or Governmental Authority.

“Affiliate” means, with respect to any Person, any other Person directly or indirectly controlling, controlled by, or under common control with such Person.  For purposes of this definition, “control” when used with respect to any Person means the power to direct the management and policies of such Person, directly or indirectly,

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whether through the ownership of voting securities, by contract or otherwise, and the terms “controlling” and “controlled” have correlative meanings.

“Applicable Law” means, with respect to the Business or any Person, any federal, state, foreign or local law (including common law), constitution, treaty, convention, ordinance, code, rule, regulation, order, injunction, judgment, decree, ruling or other similar requirement enacted, adopted, promulgated or applied by a Governmental Authority that is binding upon or applicable to the Business or such Person, as amended unless expressly specified otherwise.

“Applicable Transfer Time” means, in the case of (i) a TSA Employee, 11:59:59 p.m. on the relevant TSA Termination Date and (ii) any other Transferred Employee, the relevant Effective Time; provided that for a TSA Employee or other Transferred Employee (other than a Purchased Subsidiary Business Employee) who is on short- or long-term disability on the relevant TSA Termination Date (for TSA Employees) or at the relevant Effective Time (for such other Transferred Employees) the “Applicable Transfer Time” shall be the earlier of (x) the date required by Applicable Law or (y) date that such employee returns to employment; provided that such return to employment occurs no later than the end of the Relevant Period (or, if later, the date required by Applicable Law or any applicable collective bargaining agreement or works council agreement).

“ARD Business Employee” means any individual (i) who, as of immediately prior to the relevant Effective Time, is Employed by Seller or a Retained Subsidiary, and devotes a majority of his or her working time to performing services on behalf of the Business or a Purchased Subsidiary and (ii) who will transfer to Buyer or its applicable Subsidiary at the relevant Effective Time automatically by operation of law pursuant to the Transfer Regulations.

“ARD TSA Employee” means any individual (i) who, as of immediately prior to the relevant Effective Time, is Employed by Seller or a Retained Subsidiary and devotes a majority of his or her working time to performing services on behalf of the Business or a Purchased Subsidiary, (ii) whose services are to be provided to Buyer or any of its Subsidiaries pursuant to the Transition Services Agreement and (iii) who, if Employed by Seller or a Retained Subsidiary as of immediately prior to the applicable TSA Termination Date, will transfer to Buyer or its applicable Subsidiary on the applicable TSA Termination Date automatically by operation of law pursuant to the Transfer Regulations.

“Assigned Intellectual Property Rights” means all Intellectual Property Rights that are owned by Seller or a Subsidiary of Seller other than a Purchased Subsidiary and are used or held for use primarily in the Business (excluding any Excluded IT Asset and Excluded Software).

“Assigned IT Assets” means the IT Assets listed in Section 1.01(a) of the

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Disclosure Schedule.

“Assigned Software” means the Software listed in Section 1.01(b) of the Disclosure Schedule.

“Assumed Environmental Liabilities” means all Environmental Liabilities, whenever arising, including all items disclosed on Section 3.16 of the Disclosure Schedule, but, in each case, excluding any Retained Environmental Liabilities.

“Assumed Plan” means each Business Benefit Plan that is contributed to, sponsored, maintained or entered into by Seller or a Retained Subsidiary and that is listed on Section 1.01(c) of the Disclosure Schedule.

“Audit Adjustments” means adjustments to the Consolidated and Combined Statements of Earnings and Comprehensive Income, the Consolidated and Combined Balance Sheets, and the Consolidated and Combined Statements of Cash Flows of the Draft Audit Report for purposes of preparing the Audited Financial Statements using the rollover method whereby such adjustments are recorded in the appropriate year or years.

“Balance Sheet” means the audited balance sheet of the Business as of the Balance Sheet Date.

“Balance Sheet Date” means September 30, 2014.

“Base Modified Net Asset Value” means $195,264,000, as such amount may be adjusted pursuant to Section 2.16.

“Benefit Plan” means each (i) “employee benefit plan” as defined in Section 3(3) of ERISA, (ii) compensation, employment, consulting, severance, termination protection, change in control, transaction bonus, retention or similar plan, agreement, arrangement, program or policy or (iii) other plan, agreement, arrangement, program or policy providing for compensation, bonuses, profit-sharing, equity or equity-based compensation or other forms of incentive or deferred compensation, vacation benefits, insurance (including any self-insured arrangement), medical, dental, vision, prescription or fringe benefits, life insurance, relocation or expatriate benefits, perquisites, disability or sick leave benefits, employee assistance program, workers’ compensation, supplemental unemployment benefits or post-employment or retirement benefits (including compensation, pension, health, medical or insurance benefits).

“Brazil Base Modified Net Asset Value” means $3,383,000.

“Brazil Consideration” means an amount in U.S. dollars equal to the portion of the Closing Cash Consideration allocated to the Purchased Assets and Assumed Liabilities owned by Emerson Electric Brazil as set forth in the Master Allocation Statement.

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“Brazil Modified Net Asset Value” means, as of immediately prior to the Effective Time of Closing, the excess of (A) the Purchased Assets held by Emerson Electric Brazil over (B) the Assumed Liabilities of Emerson Electric Brazil, in each case, with such adjustments thereto as specified in the Accounting Policies and Modified Net Asset Value Schedule and otherwise calculated in accordance with, and including the line items set forth in, the Illustrative Modified Net Asset Value Statement set forth in Schedule II.  For the avoidance of doubt, the Brazil Modified Net Asset Value shall, in all cases, exclude that portion of Closing Cash attributable to the Purchased Assets of Emerson Electric Brazil and be determined with respect to the Purchased Assets and Assumed Liabilities of Emerson Electric Brazil in their entirety.

“Brazil Modified Net Asset Value Adjustment” means the positive or negative difference between Brazil Modified Net Asset Value and Brazil Base Modified Net Asset Value.

“Business” means Seller’s mechanical power transmission business which comprises the design, manufacture, sale and service of (i) bearings, including mounted, unmounted, cam followers, aerospace, and rod-end; (ii) couplings, including disc, high performance disc, gear, diaphragm and gear spindles; (iii)  plastic conveying products, including modular belts, chains, guide rails, sprockets, and other plastic conveying components; (iv) drive components, including belt drives, roller chain, torque overload devices, bushings, chains, sprockets, conveyor backstops and mechanical cam clutches; (v) gearing, including helical concentric, shaft mount, right angle, bevel, miter, center pivot and worm; and (vi) related education, design, installation, monitoring, diagnostic, and repair services for the foregoing products.  The Business as described above is currently conducted under the brand names Browning, McGill, SealMaster, System Plast, Kop-Flex, Jaure, Morse, and Rollway.

“Business Benefit Plan” means each Benefit Plan that is contributed to, sponsored, maintained or entered into by Seller or a Retained Subsidiary, a Purchased Subsidiary or any Affiliate of any of them for the benefit of any Business Employee.

“Business Day” means a day, other than Saturday, Sunday or other day on which commercial banks in New York, New York are authorized or required by Applicable Law to close.

“Business Employee” means any individual who is (i) a Purchased Subsidiary Business Employee, (ii) an ARD Business Employee, (iii) a Non-ARD Business Employee or (iv) a TSA Employee.  Notwithstanding the foregoing, the individuals listed on Section 1.01(d) of the Disclosure Schedule shall not be deemed to be Business Employees.

“Business Intellectual Property Rights” means (i) all Assigned Intellectual Property Rights and (ii) all Intellectual Property Rights owned by the Purchased Subsidiaries.

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“Byrd Amendment” means the Continued Dumping and Subsidy Offset Act of 2000.

“Carve Out Plan” means the Project Viceroy Power Transmission Solutions Carve Out Plan, dated September 26, 2014.

“Cash Repatriation Plan” means the Project Viceroy Power Transmission Solutions Cash Repatriation Plan, dated September 26, 2014.

“China Consideration” means an amount in Chinese renminbi equal to the portion of the Closing Cash Consideration allocated to the shares of capital stock of EPT China as set forth in the Master Allocation Statement.

“China Escrow Account” means the bank account designated in writing by the China Escrow Agent.

“China Escrow Agent” means Standard Chartered Bank.

“China Escrow Agreement” means the Escrow Agreement substantially in the form attached hereto as Exhibit A to be entered into at or prior to the Closing among the applicable Affiliates of Seller and Buyer and the China Escrow Agent.

“Closing Cash” means, as of immediately prior to the Effective Time of Closing, the aggregate amount of cash and cash equivalents of (x) the Purchased Subsidiaries and (y) the Business that constitute a Purchased Asset, in each case, determined in accordance with GAAP applied on a consistent basis.

“Closing Date” means the date on which the Closing occurs.

“Code” means the United States Internal Revenue Code of 1986.

“Combined Tax” means (i) any Tax with respect to which any of the Purchased Subsidiaries has filed or will file a Tax Return with a member of any Seller Group on a consolidated basis pursuant to Section 1501 of the Code and (ii) any income or franchise Tax payable to any state, local or foreign taxing jurisdiction in which any of the Purchased Subsidiaries has filed or will file a Tax Return with a member of any Seller Group (other than a group that consists solely of two or more of the Purchased Subsidiaries) on an affiliated, consolidated, combined or unitary basis with respect to such Tax.

“Competition Laws” means statutes, rules, regulations, orders, decrees, administrative and judicial doctrines, and other laws that are designed or intended to prohibit, restrict or regulate actions having the purpose or effect of monopolization, lessening of competition or restraint of trade.

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“Confidentiality Agreement” means the confidentiality agreement between Buyer and Seller dated as of August 15, 2014.

“Disclosure Schedule” means the disclosure schedule delivered by Seller to Buyer concurrently with the execution and delivery of this Agreement.

“Domestic Subsidiary Shares” means all of the outstanding shares of capital stock of, or other equity interests in (i) Emerson Power Transmission Corporation, (ii) Kop-Flex, Inc. and (iii) System Plast, LLC.

“Draft Audit Report” means the draft consolidated and combined financial statements attached as Schedule IV hereto.

“Emerson Electric Brazil” means Emerson Electric do Brasil Ltda., a company organized under the laws of Brazil.

“Emerson India” means Emerson Electric Company (India) Private Ltd.

“Emerson Philippines” means Emerson Electric (Asia) Limited — Regional Operating Headquarters (Philippines).

“Emerson Slovakia” means Emerson a.s. (Slovakia).

“Emerson UAE” means Emerson FZE (UAE).

“Employed” means, with respect to a Business Employee as of an applicable date of determination, that as of such date such Business Employee (i) is actively employed, (ii) is absent from work on account of paid time off, vacation, sick or personal leave, short- or long-term disability or leave of absence (other than a leave of absence resulting from a reduction in force or a “bridging” of age and/or service credit for purposes of a Business Benefit Plan) or (iii) for whom an obligation to recall, rehire or otherwise return to employment exists under a contractual obligation or Applicable Law.

“Environmental Laws” means any Applicable Laws relating to the environment or any spill, release, discharge, disposal or recycling of, or exposure to, any pollutant or contaminant or ignitable, corrosive, reactive or otherwise hazardous substance or waste.

“Environmental Liabilities” means all Liabilities (including the costs of any Remedial Action) arising in connection with or in any way relating to the Purchased Subsidiaries, the Shares, the Business (as currently or previously conducted), the Purchased Assets, or the Real Property or any property currently or formerly owned, leased or operated by the Purchased Subsidiaries or otherwise in connection with the Business or the Purchased Assets (including the activities and operations conducted by anyone thereon, offsite disposal therefrom and Hazardous Substances migrating thereto), that in each case arise under or relate to any Environmental Law or a Hazardous Substance, including Liabilities arising from any Third Party Claims for personal injury,

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death, or property damage caused by an actual or alleged release of, or exposure to, a Hazardous Substance.

“EPT China” means Emerson Power Transmission (Zhangzhou) Co. Ltd.

“EPT China Loan Agreement” means an agreement substantially in the form of Exhibit B hereto; provided that (i) the loan will be made by the applicable Affiliate of Buyer, as lender, to EPT China, as borrower, (ii) the interest rate on the loan shall be no more than 3.5% per annum, (iii) no interim payments of interest or principal shall be required prior to the Deferred Closing with respect to EPT China, (iv) drawdowns on the loan shall be initiated by EPT China by delivering a drawdown notice to the lender and the entrustment bank, and (v) all taxes, bank commissions, costs and expenses for the loan will be borne by the applicable Affiliate of Buyer.

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

“Existing China Intercompany Loan” means the intercompany receivable between EPT China to Emerson Electric (China) Holding Co. Ltd. outstanding as of the Closing.

“Existing Litigation Rights” means the Actions described on Section 1.01(f) of the Disclosure Schedule.

“Financing Sources” shall mean each lender and each other Person (including each agent and arranger) that have committed to provide or otherwise entered into agreements in connection with the Financing in connection with the transactions contemplated hereby together with each former, current and future Affiliate thereof and each former, current and future officer, director, employee, partner, controlling person, advisor, attorney, agent and representative of each such lender, other Person or Affiliate or the heirs, executors, successors and assigns of any of the foregoing.

“Foreign Subsidiary Shares” means all of the outstanding shares of capital stock of, or other equity interests in, (i) System Plast Srl, (ii) EPT China (iii) Jaure, S.A., (iv) Motoreductores U.S., S.A. de C.V., (v) Transmisiones de Potencia Emerson, S.A. de C.V, and (vi) Rollway Bearing.

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

“Governmental Authority” means any transnational, domestic or foreign federal, state or local, governmental authority, department, court, agency or official, including any political subdivision thereof.

“Hazardous Substances” means any pollutant or contaminant or any toxic, radioactive, ignitable, corrosive, reactive or otherwise hazardous substance, waste or material, including petroleum, its derivatives, by-products and other hydrocarbons, asbestos in any form that is or could become friable, and any other substance, waste or

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material regulated as a pollutant or otherwise as “hazardous” under any Environmental Law.

“HSR Act” means the Hart-Scott-Rodino Antitrust Improvements Act of 1976.

“Income Tax” means any Tax that is, in whole or in part, based on or measured by net income or gains, and any similar Tax.

“Indebtedness” means (i) all obligations for borrowed money, (ii) all obligations evidenced by notes, bonds, debentures or other instruments, (iii) all obligations for the deferred purchase price of property or services (other than current liabilities incurred in the ordinary course of business), (iv) all commitments by which a Person assures a creditor against loss (including contingent reimbursement obligations regarding letters of credit), excluding commitments securing performance under contractual obligations in the ordinary course of business, (v) all obligations under capitalized leases, (vi) all guarantees (other than product warranties made in the ordinary course of business), including guarantees of any items set forth in clauses (i) through (v), but excluding any guarantees of performance under contractual obligations in the ordinary course of business, and (vii) all outstanding prepayment premiums, if any, and accrued interest, fees and expenses related to any of the items set forth in clauses (i) through (vi).  For the avoidance of doubt, the term “Indebtedness” shall not include any pension or other post-employment benefits.

“India Consideration” means an amount in U.S. dollars equal to the portion of the Closing Cash Consideration allocated to the Purchased Assets and Assumed Liabilities of Emerson India as set forth in the Master Allocation Statement.

“Intellectual Property Cross-License Agreement” means an intellectual property cross-license agreement to be entered into between Buyer and Seller at the Closing in substantially the form attached hereto as Exhibit C.

“Intellectual Property Rights” means any trademark, service mark, trade dress, trade name, domain name, mask, work, invention, patent, trade secret, copyright, know how, rights of privacy and rights of publicity, any of the foregoing rights to the extent subsisting in websites, original works of authorship or Software, any registrations, issuances, or applications for registration or issuance of any of the foregoing and any other similar type of proprietary or intellectual property right, together with all related rights.

“International Plan” means any Business Benefit Plan that covers Business Employees who perform (or who, as of immediately prior to termination of their employment with Seller and its Affiliates, performed) services primarily in a country other than the United States.

“IRS” means the United States Internal Revenue Service.

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“IT Assets” means any and all computers, firmware, middleware, servers, workstations, routers, hubs, switches, data communications lines, and all other information technology equipment, and all associated documentation.

“knowledge of Seller,” “Seller’s knowledge” or any other similar knowledge qualification in this Agreement means the actual knowledge of the individuals set forth in Section 1.01(g) of the Disclosure Schedule.

“Liability” means any liability, cost, expense, debt or obligation of any kind, character, or description, and whether known or unknown, accrued, absolute, contingent or otherwise, and regardless of when asserted or by whom.

“Lien” means, with respect to any property or asset, any mortgage, lien, license grant, pledge, charge, security interest or encumbrance in respect of such property or asset.

“Material Adverse Effect” means a material adverse effect on the business, financial condition or results of operations of the Business, taken as a whole, except for any such effect (i) relating to any Excluded Asset or Excluded Liability or (ii) resulting from or arising in connection with (A) changes in the financial or securities markets, including in interest rates or currency exchange rates, (B) changes in economic, regulatory or political conditions generally, (C) changes or conditions affecting generally the industries in which the Business operates or the industries in which suppliers and customers of the Business operate, (D) changes in Applicable Law, GAAP or other applicable accounting or regulatory standards or principles, or in authoritative interpretations thereof, (E) acts of war, sabotage or terrorism or natural disasters, (F) the announcement of this Agreement or pendency or consummation of the transactions contemplated hereby, (G) any failure of the Business to meet any internal or industry financial estimates, forecasts or projections for any period (it being understood that any effect that has contributed to such failure may be taken into account in determining whether there has been, or would reasonably be expected to be, a Material Adverse Effect, unless it is otherwise excluded from the definition thereof pursuant to a clause other than this clause (G)), (H) changes attributable to actions by or on behalf of Buyer or any of its Affiliates (including actions taken by Buyer or any of its Affiliates pursuant to, or to comply with, Section 7.01) or (I) any actions taken by Seller or any of its Affiliates that are required or expressly contemplated to be taken pursuant to this Agreement (including pursuant to Section 7.01); provided, that any matter described in any of subclauses (ii)(A), (ii)(B), (ii)(D) or (ii)(E) shall be taken into account in determining whether there has been, or would reasonably be expected to be, a Material Adverse Effect to the extent such matter has had a disproportionate effect on the business, financial condition or results of operations of the Business (including the Purchased Assets and Assumed Liabilities), taken as a whole, relative to other participants in the industries in which the Business operates.

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“Modified Net Asset Value” means, as of immediately prior to the Effective Time of Closing, the excess of (A) the Purchased Assets and the assets owned by the Purchased Subsidiaries on a consolidated basis over (B) the Assumed Liabilities and the liabilities of the Purchased Subsidiaries on a consolidated basis, in each case, with such adjustments thereto as specified in the Accounting Policies and Modified Net Asset Value Schedule and otherwise calculated in accordance with, and including the line items set forth in, the Illustrative Modified Net Asset Value Statement set forth in Schedule II; provided, that Modified Net Asset Value shall exclude any Purchased Assets and Assumed Liabilities of Emerson Electric Brazil. For the avoidance of doubt, Modified Net Asset Value shall, in all cases, exclude Closing Cash and, except as set forth in the proviso to the immediately preceding sentence, be determined with respect to the Purchased Assets, Assumed Liabilities and the Purchased Subsidiaries in their entirety, including those of any Deferred Business.

“Modified Net Asset Value Adjustment” means the positive or negative difference between Modified Net Asset Value and Base Modified Net Asset Value, as the case may be, provided that the absolute value of the Modified Net Asset Value Adjustment shall not exceed $2,000,000.

“Net Brazil Cash Pool Change” means the positive or negative difference equal to (i) the amount specified in the line item entitled “Long Term Debt Intercompany” on the balance sheet of the Brazil Deferred Business as of the Effective Time on the Deferred Closing Date with respect to the Brazil Deferred Business minus (ii) the amount specified in the line item entitled “Long Term Debt Intercompany” on the balance sheet of the Brazil Deferred Business as of the Effective Time on the Closing Date.

“Net Brazil Accounts Receivable Change” means the positive or negative difference equal to (i) the amount specified in the line item entitled “net accounts receivable” on the balance sheet of the Brazil Deferred Business as of the Effective Time on the Deferred Closing Date minus (ii) the amount specified in the line item entitled “net accounts receivable” on the balance sheet of the Brazil Deferred Business as of the Effective Time on the Closing Date.

“Net Brazil Accounts Payable Change” means the positive or negative difference equal to (i) the amount specified in the line items entitled “accounts payable trade and other”, “accounts payable intercompany” and “accrued expenses” (excluding accrued salaries) on the balance sheet of the Brazil Deferred Business as of the Effective Time on the Deferred Closing Date minus (ii) the amount specified in the line items entitled “accounts payable trade and other”, “accounts payable intercompany” and “accrued expenses” (excluding accrued salaries) on the balance sheet of the Brazil Deferred Business as of the Effective Time on the Closing Date.

“Net UAE Cash Pool Change” means the positive or negative difference equal to (i) the amount specified in the line item entitled “Cash equivalents — cash pool” on the balance sheet of the UAE Deferred Business as of the Effective Time on the Deferred

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Closing Date with respect to the UAE Deferred Business minus (ii) the amount specified in the line item entitled “Cash equivalents — cash pool” on the balance sheet of the UAE Deferred Business as of the Effective Time on the Closing Date.

“Non-ARD Business Employee” means any individual (other than an ARD Business Employee or ARD TSA Employee) who, as of immediately prior to the relevant Effective Time, is Employed by Seller or a Retained Subsidiary and who devotes a majority of his or her working time to performing services on behalf of the Business or a Purchased Subsidiary.

“Non-ARD TSA Employee” means any individual (other than an ARD TSA Employee) who, as of immediately prior to the relevant Effective Time, is Employed by (i) a Purchased Subsidiary, Seller or a Retained Subsidiary and whose services are to be provided to Buyer or any of its Subsidiaries pursuant to the Transition Services Agreement or (ii) Emerson UAE, and in each case, who devotes a majority of his or her working time to performing services on behalf of the Business or a Purchased Subsidiary.

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

“Philippine Consideration” means an amount in U.S. dollars equal to the portion of the Closing Cash Consideration allocated to the Business conducted by Emerson Philippines as set forth in the Master Allocation Statement.

“Post-Closing Tax Period” means any Tax period beginning after the Closing Date; and, with respect to a Straddle Tax Period, the portion of such Tax period beginning after the Closing Date.

“Pre-Closing Tax” means any Tax related to the Pre-Closing Tax Period; provided that in the case of any Tax (other than a Transfer Tax) that is payable for a Straddle Tax Period, the portion of such Tax related to the Pre-Closing Tax Period shall equal the portion of such Tax that would have been payable if the relevant Tax period ended on and included the Closing Date.  Any credits with respect to a Straddle Tax Period shall be taken into account as though the relevant Taxable period ended on the Closing Date.

“Pre-Closing Tax Period” means any Tax period ending on or before the Closing Date; and, with respect to a Straddle Tax Period, the portion of such Tax period ending on the Closing Date.

“PTS Audited Adjusted EBITDA” means PTS EBITDA, adjusted to exclude the effects of Audit Adjustments:

(i)                       to the extent they relate to any Excluded Liability or any Liability reflected on the audited balance sheet for the year ended September 30, 2014 in

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respect of which Seller has an indemnity obligation under Section 11.02(a)(i) through 11.02(a)(x);

(ii)                    arising out of or related to any matter disclosed in the Disclosure Schedules;

(iii)                 that shift revenue or expenses from the fiscal year ending September 30, 2014 to the fiscal year ending September 30, 2015; and

(iv)                relating to extraordinary, unusual or non-recurring items.

“PTS EBITDA” means for the one-year period ending September 30, 2014, earnings before income taxes plus interest income, net plus depreciation and amortization.  For purposes of this definition, the amount of “earnings before income taxes” and “interest income, net” shall be determined by reference to the corresponding line items on the Consolidated and Combined Statements of Earnings and Comprehensive Income that comprise the Audited Financial Statements, and the amount of “depreciation and amortization” shall be determined by reference to the corresponding line item on the Consolidated and Combined Statements of Cash Flows that comprise the Audited Financial Statements.

“PTS Unaudited Adjusted EBITDA” means $107,174,000.

“Purchased Domestic Subsidiaries” means the following direct and indirect Subsidiaries of Seller:  (i) Emerson Power Transmission Corporation, (ii) McGill Manufacturing Company, Inc., (iii) Emerson Chain, Inc., (iv) Regina-Emerson (Wisconsin), (v) UCC Corp., (vi) Kop-Flex, Inc., (vii) System Plast, LLC, (viii) SPPA LLC and (ix) Solus Industrial Innovations LLC.

“Purchased Foreign Subsidiaries” means the following direct and indirect Subsidiaries of Seller: (i) System Plast Srl, (ii) SCI de la Peupleraie, (iii) System Plast GmbH, (iv) System Plast Ltd., (v) System Plast SAS, (vi) EPT China, (vii) Jaure, S.A., (viii) Motoreductores U.S., S.A. de C.V., (ix) Transmisiones de Potencia Emerson, S.A. de C.V, (x) Rollway Bearing and (xi) Kop-Flex Canada Limited.

“Purchased Subsidiaries” means, collectively, the Purchased Domestic Subsidiaries and the Purchased Foreign Subsidiaries.

“Purchased Subsidiary Benefit Plan” means each Business Benefit Plan that is sponsored, maintained or entered into by a Purchased Subsidiary.

“Purchased Subsidiary Business Employee” means any individual (other than a Non-ARD TSA Employee) who, as of immediately prior to the Applicable Transfer Time, is Employed by a Purchased Subsidiary.

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“Recall” means any customer-wide, SKU-wide or field-wide “recall” or “campaign” or field service action with respect to repair or replacement.

“Recoverable Transfer Taxes” means Transfer Taxes that are recoverable through a refund, offset or other reduction in Tax liability in the relevant jurisdiction imposing such Transfer Tax.

“Remedial Action” means any investigation, remediation, clean-up, abatement, removal or monitoring (or words of similar import) of Hazardous Substances.

“Representative” means, with respect to any Person, such Person’s directors, officers, employees, counsel, financial advisors, auditors, agents and other authorized representatives.

“Retained Benefit Plan” means any Business Benefit Plan that is not an Assumed Plan or a Purchased Subsidiary Benefit Plan and, for the avoidance of doubt, shall include any Business Benefit Plan that is a change of control agreement, stay bonus letter (other than the Assumed Extra Salary Program, as defined in Section 1.01(c) of the Disclosure Schedule) or equity compensation award.

“Retained Business” means any business now, previously or hereafter conducted by Seller or any of its Subsidiaries or Affiliates other than the Business.

“Retained Subsidiaries” means all of the direct and indirect Subsidiaries of Seller other than the Purchased Subsidiaries.

“Rollway Bearing” means Rollway Bearing N.V., a Belgium company.

“Section 338(h)(10) Subsidiaries” means the following direct and indirect Subsidiaries of Seller:  (i) Emerson Power Transmission Corporation, (ii) Emerson Chain, Inc. and (iii) System Plast, LLC.

“Seller Group” means, with respect to U.S. federal income Taxes, the affiliated group of corporations (as defined in Section 1504(a) of the Code) of which Seller is a member and, with respect to state, local or foreign income or franchise Taxes, any consolidated, combined or unitary group of which Seller or any of its Affiliates is a member for such state, local or foreign income or franchise Tax purposes.

“Shares” means, collectively, the Domestic Subsidiary Shares and the Foreign Subsidiary Shares.

“Slovakia Consideration” means an amount in U.S. dollars equal to the portion of the Closing Cash Consideration allocated to the Purchased Assets and Assumed Liabilities of Emerson Slovakia as set forth in the Master Allocation Statement.

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“Slovakia Services Agreement” means an agreement to be entered into prior to Closing (or the Deferred Closing with respect to the Slovakia Deferred Business, if applicable) between Emerson Slovakia and Buyer’s Slovakian Subsidiary, in a form and substance reasonably satisfactory to Buyer and Seller, setting forth the terms and conditions for the provision of certain services at the real property in Slovakia that will be transferred to Buyer.

“Software” means any and all (i) computer programs, including any and all software implementation of algorithms, models and methodologies, whether in source code, object code, human readable form or other form, (ii) databases and compilations, including any and all data and collections data, whether machine readable or otherwise, (iii) descriptions, flow charts and other work products used to design, plan, organize and develop any of the foregoing, screens, user interfaces, report formats, firmware, development tools, templates, menus, buttons and icons and (iv) all documentation including user manuals and other training documentation relating to any of the foregoing.

“Straddle Tax Period” means a Tax period that begins on or before the Closing Date and ends thereafter.

“Subsidiary” means, with respect to any Person, any entity of which securities or other ownership interests having ordinary voting power to elect a majority of the board of directors or other persons performing similar functions are at the time directly or indirectly owned by such Person; provided, that Emerson Chain, Inc. and SCI de la Peupleraie each shall be deemed to be a Subsidiary of Seller.

“Tax” means (i) any tax, governmental fee or other like assessment or charge of any kind whatsoever (including withholding on amounts paid to or by any Person), together with any interest, penalty, addition to tax or additional amount imposed by any Governmental Authority (a “Taxing Authority”) responsible for the imposition of any such tax (domestic or foreign), and any liability for any of the foregoing as transferee, (ii) in the case of any of the Purchased Subsidiaries, liability for the payment of any amount of the type described in clause (i) as a result of being or having been before the Closing a member of an affiliated, consolidated, combined or unitary group, or a party to any agreement or arrangement, as a result of which liability of such Purchased Subsidiary to a Taxing Authority is determined or taken into account with reference to the activities of any other Person and (iii) liability of any of the Purchased Subsidiaries for the payment of any amount as a result of being party, prior to the Closing, to any Tax Sharing Agreement.

“Tax Asset” means any net operating loss, net capital loss, investment tax credit, foreign tax credit or any other credit or tax attribute that could be carried forward or back to reduce Taxes (including deductions and credits related to alternative minimum Taxes) and losses or deductions deferred by the Code or other Applicable Law.

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“Tax Return” means any report, return, document, declaration or other information or filing required to be supplied to any Taxing Authority with respect to Taxes, including information returns and any documents with respect to or accompanying payments of estimated Taxes, or with respect to or accompanying requests for the extension of time in which to file any such report, return, document, declaration or other information.

“Tax Sharing Agreements” means all agreements or arrangements (whether or not written), including all express or implied agreements or arrangements, binding Seller or any of its Subsidiaries that provide for the allocation, apportionment, sharing or assignment of any Tax Liability or benefit, or the transfer or assignment of income, revenues, receipts, or gains for the purpose of determining any Person’s Tax liability.

“Transaction Documents” means, collectively, this Agreement, the China Escrow Agreement, the U.S. Escrow Agreement, each Foreign Transfer Agreement, the EPT China Loan Agreement, the Emerson Slovakia Loan Agreement, the Intellectual Property Cross-License Agreement, the Slovakia Services Agreement and the Transition Services Agreement.

“Transfer Regulations” means any law implementing Council Directive 77/187/EEC as amended by Council Directive 90/50/EC and any similar legislation in any jurisdiction which provides for the automatic transfer of employment in the event of a transfer of a business or services.

“Transfer Tax” means any excise, sales, use, value added, registration stamp, recording, documentary, conveyancing, franchise, property, transfer, gains and similar Taxes, levies, charges and fees (including any penalties and interest); provided that, for the avoidance of doubt, (i) the tax imposed on the on the transfer of shares of a Mexican entity by a non-resident of Mexico (Impuesto Sobre la Renta) shall not be a Transfer Tax and (ii) the enterprise income tax imposed on any capital gains realized from the transfer of a Chinese resident entity shall not be a Transfer Tax.

“Transition Services Agreement” means a Transition Services Agreement to be entered into between Buyer and Seller at the Closing in substantially the form attached hereto as Exhibit D.

“Treasury Regulations” means the rules and regulations promulgated by the U.S. Treasury Department under the Code.

“Tri-Partite Agreement” shall mean an agreement in a form satisfactory to each of Seller and Buyer among (a) Seller (or its applicable Affiliate), (b) Buyer (or its applicable Subsidiary) and (c) a Business Employee who is based in China, Colombia, India, the Philippines, Singapore or the UAE pursuant to which (i) such Business Employee agrees (x) to the transfer of his or her employment to Buyer (or its applicable Subsidiary) and (y) to waive any entitlement to severance or other termination-related

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payments or benefits in connection with such transfer and (ii) Buyer (or its applicable Subsidiary) agrees to make an offer to employ such Business Employee on the terms set forth in Article 9.

“TSA Employee” means an ARD TSA Employee or a Non-ARD TSA Employee.

“TSA Termination Date” means, in relation to a TSA Employee, the date on which Seller or its relevant Affiliate ceases to provide such TSA Employee’s service pursuant to the Transition Services Agreement.

“UAE Consideration” means an amount in U.S. dollars equal to the portion of the Closing Cash Consideration allocated to the Purchased Assets and Assumed Liabilities owned by Emerson UAE as set forth in the Master Allocation Statement.

“U.S. Escrow Account” means the bank account designated in writing by the U.S. Escrow Agent.

“U.S. Escrow Agent” means Wells Fargo Bank, N.A.

“U.S. Escrow Agreement” means the Escrow Agreement substantially in the form attached hereto as Exhibit E to be entered into at or prior to the closing among the applicable Affiliates of Seller and Buyer and the U.S. Escrow Agent.

(b)                                 Each of the following terms is defined in the Section set forth opposite such term:

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Section 1.02.                          Other Definitional and Interpretative Provisions.  The words “hereof”, “herein” and “hereunder” and words of like import used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement.  The captions herein are included for convenience of reference only and shall be ignored in the construction or interpretation hereof.  References to Articles, Sections, Exhibits and Schedules are to Articles, Sections, Exhibits and Schedules of this Agreement unless otherwise specified.  All Exhibits and Schedules annexed hereto or referred to herein are hereby incorporated in and made a part of this Agreement as if set forth in full herein.  Any capitalized terms used in any Exhibit or Schedule but not otherwise defined therein shall have the meaning as defined in this Agreement.  Any singular term in this Agreement shall be deemed to include the plural, and any plural term the singular.  Whenever the words “include”, “includes” or “including” are used in this Agreement, they shall be deemed to be followed by the words “without limitation”, whether or not they are in fact followed by those words or words of like import.  “Writing”, “written” and comparable terms refer to printing, typing and other means of reproducing words (including electronic media) in a visible form.  References to any agreement or contract are to that agreement or contract as amended, modified or supplemented from time to time in accordance with the terms thereof.  References to any Person include the successors and permitted assigns of that Person.  References from or through any date

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mean, unless otherwise specified, from and including or through and including, respectively.  References to “law,” “laws” or to any Applicable Law shall be deemed to refer to such law or Applicable Law as amended from time to time, except as otherwise specified herein, and to any rules or regulations promulgated thereunder.  All references to any time herein shall refer to Eastern Time.  The parties have participated jointly in the negotiation and drafting of this Agreement and, in the event an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as jointly drafted by the parties and no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of the authorship of any provision of this Agreement.

ARTICLE 2
Purchase and Sale

Section 2.01.                          Purchase and Sale of the Shares.  Upon the terms and subject to the conditions of this Agreement, Seller agrees to, and to cause the applicable Retained Subsidiaries to, sell to Buyer, and Buyer agrees to purchase from Seller and such applicable Retained Subsidiaries, the Shares at the Closing (or in the case of EPT China, at the Deferred Closing of the China Deferred Business, if applicable).  Seller shall, or shall cause the Retained Subsidiaries to, as applicable, transfer and deliver to Buyer at the Closing (or in the case of EPT China, at the Deferred Closing of the China Deferred Business, if applicable) valid title to such Shares free and clear of any Lien.

Section 2.02.                          Purchase and Sale of the Purchased Assets.  Except as otherwise provided below, upon the terms and subject to the conditions of this Agreement, Buyer agrees to purchase from Seller and the Retained Subsidiaries, and Seller agrees to, and to cause the Retained Subsidiaries to, sell, convey, transfer, assign and deliver, or cause to be sold, conveyed, transferred, assigned and delivered, to Buyer at the Closing (or, to the extent applicable, at the relevant Deferred Closing), free and clear of any Liens other than Permitted Liens, all of Seller’s and the Retained Subsidiaries’ right, title and interest in, to and under the assets, properties and business of every kind and description, owned, used or held for use primarily in the conduct of the Business by Seller or any of the Retained Subsidiaries (but excluding any Excluded Assets and excluding any assets, properties and businesses owned by a Purchased Subsidiary) as the same shall exist as of the relevant Effective Time (the “Purchased Assets”), including all right, title and interest of Seller and the Retained Subsidiaries in, to and under the following Purchased Assets to the extent owned, held or used primarily in the conduct of the Business:

(a)                                 the real property, together with all buildings, fixtures and improvements erected thereon, and the leases of, and other interests in real property, in each case, listed or required to be listed on Section 3.11(a) of the Disclosure Schedule;

(b)                                 all tangible personal property and interests therein;

(c)                                  all raw materials, work-in-process, finished goods, supplies and other inventories;

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(d)                                 all transferable contracts listed in Section 3.08 of the Disclosure Schedule and all transferable rights under all other contracts, agreements, licenses, commitments, sales and purchase orders and other instruments, but excluding the PTS Hedging Contracts (collectively, the “Purchased Contracts”);

(e)                                  all transferable rights, claims, credits, causes of action or rights of set-off against third parties relating to or arising from the Purchased Assets or the Assumed Liabilities, including unliquidated rights under manufacturers’ and vendors’ warranties and all rights to bring any Action in respect of the foregoing, other than any Existing Litigation Right;

(f)                                   all trade accounts receivable and other receivables reflected on the Balance Sheet (including any intercompany accounts receivable payable by Seller or any Retained Subsidiary);

(g)                                  all prepaid assets;

(h)                                 all Assigned Intellectual Property Rights;

(i)                                     all Assigned Software and Assigned IT Assets;

(j)                                    all transferable governmental licenses, permits or other governmental authorizations;

(k)                                 the laboratory equipment owned by Emerson India, as identified in Section 2.02(k) of the Disclosure Schedule;

(l)                                     all assets of the Assumed Plans;

(m)                             notwithstanding Section 2.03(c), all proceeds received from and after the Closing under any third-party insurance policies relating to the Business, except to the extent such proceeds relate to an Excluded Asset or Excluded Liability;

(n)                                 the computers owned by Seller or its Subsidiaries (other than the Purchased Subsidiaries) and used or held for use primarily by the Transferred Employees of Emerson Electric de Colombia Ltda. (Colombia), Emerson Electric (South Asia) Pte. Ltd. (Singapore), Emerson Srl (Romania) and Emerson Process Management Srl (Romania), in each case as identified in Section 2.02(n) of the Disclosure Schedule;

(o)                                 all books, records, data, databases, files and papers, whether in hard copy or electronic format, including any information relating to any Tax imposed on the Purchased Assets (it being understood that Seller and the Retained Subsidiaries shall be permitted to retain copies of such materials); and

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(p)                                 subject to Applicable Law, the personnel records (including all human resources and other records) of Seller or a Retained Subsidiary relating to Transferred Employees.

Section 2.03.                          Excluded Assets.  Buyer expressly understands and agrees that all of the assets of Seller and the Retained Subsidiaries other than the Purchased Assets and Shares shall remain the property of Seller or such Retained Subsidiaries (collectively, the “Excluded Assets”), which shall include the following:

(a)                                 all cash and cash equivalents on hand and in banks, except for any cash or cash equivalents delivered to or for the benefit of Buyer and taken into account in the determination of Closing Cash;

(b)                                 all bank accounts not exclusively dedicated to the Business;

(c)                                  all insurance policies relating to the Business and all claims, credits, causes of action or rights thereunder;

(d)                                 all Intellectual Property Rights listed in Section 2.03(d) of the Disclosure Schedule (the “Excluded Intellectual Property Rights”);

(e)                                  all Software (other than the Assigned Software) (the “Excluded Software”);

(f)                                   all IT Assets (other than the Assigned IT Assets) (the “Excluded IT Assets”);

(g)                                  all books, records, files and papers, whether in hard copy or electronic format, prepared in connection with this Agreement or the transactions contemplated hereby, and all minute books and corporate records of Seller and the Retained Subsidiaries;

(h)                                 all rights of Seller or any of the Retained Subsidiaries arising under the Transaction Documents or the transactions contemplated thereby;

(i)                                     all assets sold or otherwise disposed of during the period from the date hereof until the relevant Effective Time;

(j)                                    all assets of the Retained Benefit Plans;

(k)                                 the personnel records (including all human resources and other records) of Seller or a Retained Subsidiary relating to employees of Seller or such Retained Subsidiary (other than the personnel records relating to the Transferred Employees as contemplated by Section 2.02(p));

(l)                                     any Existing Litigation Right;

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(m)                             all hedging or swap contracts, agreements or similar arrangements (the “PTS Hedging Contracts”);

(n)                                 all contracts, agreements or binding obligations to which Seller is party (other than those listed in Section 3.08(a)(ix) of the Disclosure Schedule) including all of the Master Supply Agreements listed in Section 2.03(n) of the Disclosure Schedule;

(o)                                 (x) the computers, phones and personal electronics used by the Transferred Employees of Emerson Philippines identified in Section 2.03(o) of the Disclosure Schedule and (y) the loans made to Business Employees by Emerson Philippines (the “Philippine Assets”);

(p)                                 all contracts, agreements or binding obligations to the extent relating to any Excluded Intellectual Property Rights, Excluded Software and/or Excluded IT Assets, other than those listed in Section 3.08(a)(ix) of the Disclosure Schedule (“Excluded IP/IT Agreements”);

(q)                                 all Tax Assets, as well as any rights to Tax refunds or credits in respect of Tax overpayments;

(r)                                    the other property and assets described in Section 2.03(r) of the Disclosure Schedule; and

(s)                                   all trade accounts receivable and other receivables reflected on the Balance Sheet (including any intercompany accounts receivable payable by Seller or any Retained Subsidiary) in each case, of Emerson Electric Brazil.

Section 2.04.                          Assumed Liabilities.  Upon the terms and subject to the conditions of this Agreement, Buyer agrees, effective at the relevant Effective Time, to assume all Liabilities of Seller or any of the Retained Subsidiaries (or any predecessor of any of the foregoing or any prior owner of all or part of the businesses or assets of any of the foregoing) primarily relating to or arising out of the Purchased Assets or the Business (as currently or formerly conducted) of whatever nature, whether presently in existence or arising hereafter, except for the Excluded Liabilities (the “Assumed Liabilities”), including the following:

(a)                                 all Liabilities set forth on the Balance Sheet, and all Liabilities incurred after the Balance Sheet Date to the extent not satisfied prior to the Effective Time of the Closing;

(b)                                 all Liabilities of Seller or any of the Retained Subsidiaries arising under the contracts, agreements and other instruments referenced in Section 2.02(d);

(c)                                  all Liabilities primarily relating to or arising out of the Purchased Assets or the Business (as currently or formerly conducted) arising out of or in connection with acts or omissions at or prior to the Effective Time of the Closing;

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(d)                                 all Liabilities under warranty obligations relating to any products manufactured or sold by the Business at or prior to the Effective Time of the Closing;

(e)                                  all Liabilities or obligations arising out of any Action related to or arising out of the Business or the Purchased Assets;

(f)                                   all trade accounts payable and other accounts and notes payable;

(g)                                  (i) all Liabilities with respect to each Transferred Employee, other than any such Liabilities that are expressly retained by Seller pursuant to Section 7.05 or Article 9, (ii) all Liabilities expressly assumed by Buyer pursuant to Section 7.05 or Article 9 and (iii) all Liabilities under any Purchased Subsidiary Benefit Plan or Assumed Plan;

(h)                                 all Liabilities primarily relating to or arising out of the Purchased Assets or the Business (as currently or formerly conducted) arising out of or in connection with any act, omission or circumstance occurring at any time after the Effective Time of the Closing;

(i)                                     all Liabilities for any Third Party Claim relating to, or arising out of, the use, application, malfunction, defect, design, operation, performance or suitability of any product of the Business manufactured, sold or distributed prior to the Effective Time of the Closing; and

(j)                                    all Assumed Environmental Liabilities.

Buyer’s obligations under this Section 2.04 shall not be subject to offset or reduction, whether by reason of any actual or alleged breach of any representation, warranty or covenant contained in the Transaction Documents or any other agreement or document delivered in connection therewith or any right to indemnification hereunder or otherwise.

Section 2.05.                          Excluded Liabilities.  Buyer is assuming only the Assumed Liabilities from Seller and the Retained Subsidiaries and is not assuming any other Liability of Seller or any of the Retained Subsidiaries of whatever nature, whether presently in existence or arising hereafter.  All such other Liabilities shall be retained by and remain Liabilities of Seller or the Retained Subsidiaries, as applicable (all such Liabilities not being assumed being herein referred to as the “Excluded Liabilities”). Notwithstanding anything to the contrary contained in Section 2.04, the following Liabilities of Seller and the Retained Subsidiaries shall be Excluded Liabilities:

(a)                                 all Liabilities to the extent arising out of or relating to the operation or conduct by Seller or any of its Subsidiaries of any Retained Business;

(b)                                 all Liabilities to the extent arising out of or relating to any Excluded Asset;

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(c)                                  all Liabilities under any Retained Benefit Plan (other than such Liabilities described in Section 2.04(a) or expressly assumed by Buyer pursuant to Section 7.05 or Article 9);

(d)                                 with respect to Transferred Employees, all Liabilities expressly retained by Seller pursuant to Section 7.05 or Article 9;

(e)                                  all Liabilities (other than such Liabilities described in Section 2.04(a) or expressly assumed by Buyer pursuant to Section 7.05 or Article 9) relating to current or former employees of Seller or any of its Affiliates (other than the Transferred Employees);

(f)                                   all Indebtedness (other than the Emerson Slovakia Loan Agreement and Indebtedness solely among the Purchased Subsidiaries);

(g)                                  all PTS Hedging Contracts;

(h)                                 all obligations to any broker, finder or agent for any investment banking or brokerage fees, finders’ fees or commissions relating to the transactions contemplated by this Agreement and any other fees and expenses for which Seller is responsible pursuant to Section 13.03;

(i)                                     all Liabilities of the Seller and the Retained Subsidiaries for Taxes;

(j)                                    (A) all Liabilities in connection with any Third Party Claim whenever filed to the extent related to or arising out of human exposure to asbestos-containing materials actually or allegedly contained in products manufactured, distributed or sold by or on behalf of the Business (other than a Purchased Subsidiary) prior to the Effective Time and (B) all Environmental Liabilities to the extent relating to any real property or facilities formerly owned, leased or operated by the Business or any predecessor of the Business (in each case, other than by any Purchased Subsidiary or any predecessor thereof) that is not owned, leased or operated by the Business at the Effective Time; and

(k)                                 all trade accounts payable and other accounts and notes payable (other than accrued salaries) of Emerson Electric Brazil.

Section 2.06.                          Limitation on Assignment of Purchased Assets.  Anything in this Agreement to the contrary notwithstanding, this Agreement shall not constitute an agreement to assign any Purchased Asset or any right thereunder if an attempted assignment, without the consent of, or other action by, any third party, would constitute a breach thereunder or in any way adversely affect the rights of Buyer or Seller or any of their respective Affiliates thereunder.  If such consent is not obtained or such other action is not taken, Seller and Buyer shall cooperate in a mutually agreeable arrangement under which Buyer would obtain the benefits and assume the obligations thereunder in accordance with this Agreement.

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Section 2.07.                          Purchase Price; Allocation of Purchase Price.  (a) The purchase price for the Purchased Assets and the Shares (the “Purchase Price”) is one billion and four hundred million dollars ($1,400,000,000) in cash (the “Closing Cash Consideration”) plus Closing Cash plus the Modified Net Asset Value Adjustment plus the Brazil Modified Net Asset Value Adjustment minus the Audit Purchase Price Adjustment.  The Purchase Price shall be paid as provided in Section 2.08 (subject to Section 2.07(b) and Section 2.13(c)) and shall be subject to adjustment as provided in Section 2.10 and Section 2.12.

(b)                                 At the Closing, if and only if a Deferred Closing is required with respect to, (v) the Purchased Assets and Assumed Liabilities of Emerson Slovakia (the “Slovakia Deferred Business”), then the Slovakia Consideration shall be deposited with the U.S. Escrow Agent into the U.S. Escrow Account, (w) the Purchased Assets and Assumed Liabilities of Emerson India (the “India Deferred Business”), then the India Consideration shall be deposited with the U.S. Escrow Agent into the U.S. Escrow Account, (x) the Purchased Assets and Assumed Liabilities of Emerson Electric Brazil (the “Brazil Deferred Business”), then the Brazil Consideration shall be deposited with the U.S. Escrow Agent into the U.S. Escrow Account, (y) the Purchased Assets and Assumed Liabilities of Emerson UAE (the “UAE Deferred Business”), then the UAE Consideration shall be deposited with the U.S. Escrow Agent into the U.S. Escrow Account and (z) the shares of capital stock of EPT China (the “China Deferred Business” and together with the Slovakia Deferred Business, the India Deferred Business, the Brazil Deferred Business and the UAE Deferred Business, the “Deferred Businesses”), then the China Consideration shall be deposited with the China Escrow Agent into the China Escrow Account.  The U.S. Escrow Account and the China Escrow Account shall be held and disbursed by the U.S. Escrow Agent and the China Escrow Agent, respectively, in accordance with the terms of this Agreement and the U.S. Escrow Agreement and the China Escrow Agreement, respectively.

(c)                                  The Purchase Price shall be allocated to the Purchased Assets and the Shares as set forth in the statement attached hereto as Exhibit F (the “Master Allocation Statement”), which shall include a specific allocation with respect to each Deferred Business.

(d)                                 As promptly as practicable after the Closing, but not later than 180 days after the Closing Date, Buyer shall deliver (i) a statement allocating the “aggregate deemed sales price” (as such term is defined in Treasury Regulations Section 1.338-4) with respect to each Section 338(h)(10) Subsidiary in accordance with the Treasury Regulations promulgated under Section 338(h)(10) (the “338(h)(10) Allocation Statement”) and (ii) a statement allocating the Purchase Price with respect to the Purchased Assets (plus any Assumed Liabilities and capitalized costs taken into account under Section 1060 of the Code) among the Purchased Assets in accordance with Section 1060 of the Code (the “1060 Allocation Statement”) (the Master Allocation Statement, the 338(h)(10) Allocation Statement, and the 1060 Allocation Statement, collectively, the “Allocation Statements”). The 338(h)(10) Allocation Statement and the 1060 Allocation

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Statement shall be consistent with the allocation of the Purchase Price to the Shares and the Purchased Assets in the Master Allocation Statement. If, within 20 days after the delivery of the 338(h)(10) Allocation Statement and the 1060 Allocation Statement, Seller notifies Buyer in writing that Seller objects to any allocation set forth thereon, Buyer and Seller shall negotiate in good faith to resolve such objection. In the event that Buyer and Seller are unable to resolve such dispute within 20 days following Seller’s notification of such objection, Buyer and Seller shall jointly retain an Accounting Referee (as defined in Section 2.11(c) below) to resolve the disputed items. Upon resolution of the disputed items, the allocation reflected on the 338(h)(10) Allocation Statement and/or the 1060 Allocation Statement, as applicable, shall be adjusted to reflect such resolution. The costs, fees and expenses of the Accounting Referee shall be borne equally by Buyer and Seller.

(e)                                  If an adjustment is made with respect to the Purchase Price pursuant to Section 2.10, Section 2.12 or otherwise, any adjustment shall be allocated to the shares of Emerson Power Transmission Corporation, unless otherwise agreed by Buyer and Seller, and the Allocation Statements shall be adjusted consistent therewith. Notwithstanding the foregoing, the parties understand that the Purchase Prices shown in the Master Allocation Statement for Slovakia, Brazil and the UAE may need to be adjusted to account for the Deferred Closings in Slovakia, Brazil and the UAE and the Purchased Assets and Assumed Liabilities that are transferred in those locations on the Deferred Closing Dates under the Foreign Transfer Agreements, and hereby agree to (x) establish a purchase price in each of the Foreign Transfer Agreements for the Deferred Closings in Slovakia, Brazil and the UAE that the parties reasonably agree is appropriate based on the Purchased Assets and Assumed Liabilities that are transferred at each location on the applicable Deferred Closing Date, and (y) amend the Master Allocation Statement consistent with such purchase prices as established in clause (x) above, with a corresponding adjustment to the Purchase Price allocable to Emerson Power Transmission Corporation for any net change in Purchase Price allocable to Slovakia, Brazil and the UAE.  For the avoidance of doubt, the parties agree that the foregoing provision is not intended to change the Purchase Price, the Final Purchase Price or any other adjustments to Purchase Price or amounts payable under this Agreement.  To the extent any adjustment pursuant to clause (y) above results in an aggregate decrease in the Purchase Price allocation to Emerson Power Transmission Corporation in excess of $2 million, Seller shall pay to Buyer (in addition to any adjustment to the Purchase Price otherwise required under this Agreement) an amount in cash equal to 30% of such excess.

(f)                                   Buyer and Seller shall, and shall cause their respective Subsidiaries to, file all Tax Returns (including amended returns and claims for refunds) and information reports in a manner consistent with the Allocation Statements.

Section 2.08.                          Closing.  Subject to Section 2.13, the closing (the “Closing”) of the purchase and sale of the Shares and the Purchased Assets and the assumption of the Assumed Liabilities hereunder shall take place at the offices of Davis Polk & Wardwell

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LLP, 450 Lexington Avenue, New York, New York, on the last Business Day in the calendar month in which all of the conditions set forth in Article 10 (other than those conditions that by their nature are to be satisfied at the Closing, but subject to the satisfaction or, to the extent permitted by Applicable Law, waiver of those conditions) have been satisfied (or, to the extent permitted by Applicable Law, waived) (the date on which such conditions are satisfied (or, to the extent permitted by Applicable Law, waived), the “Closing Trigger Date”); provided that, (x) if there are less than two Business Days remaining in the calendar month when the Closing Trigger Date occurs, the Closing shall occur on the last Business Day in the immediately succeeding month, so long as all of the conditions set forth in Article 10 (other than those conditions that by their nature are to be satisfied at the Closing, but subject to the satisfaction or, to the extent permitted by Applicable Law, waiver of those conditions) are satisfied (or, to the extent permitted by Applicable Law, waived) on such date and (y) Seller may, in its sole discretion, elect to have the Closing occur on a date other than the last Business Day of the month, in which case, the Closing will occur as soon as possible, but in no event later than five Business Days after the Closing Trigger Date.  The Closing, or any Deferred Closing to the extent applicable, shall be deemed effective as of 11:59:59 p.m. on the Closing Date, or such Deferred Closing Date, as applicable (the “Effective Time”).  At the Closing, the following transactions will occur in the following sequence (each transaction to occur immediately after the preceding transaction):

(a)                                 Buyer shall deliver to Seller:

(i)                                     a certificate, dated the Closing Date and signed by an executive officer of Buyer, pursuant to Section 10.03(c) hereof; and

(ii)                                  a duly executed counterpart to each Transaction Document to which Buyer or any Affiliate thereof is a party; provided that failure to deliver the Slovak Services Agreement shall not be considered a material breach of this provision.

(b)                                 Seller shall deliver to Buyer:

(i)                                     a certificate, dated the Closing Date and signed by an executive officer of Seller, pursuant to Section 10.02(c) hereof;

(ii)                                  a non-foreign person affidavit from each Retained Subsidiary transferring Domestic Subsidiary Shares dated as of the Closing Date as required by Section 1445 of the Code; and

(iii)                               a duly executed counterpart to each Transaction Document to which Seller or any Affiliate thereof is a party; provided that failure to deliver the Slovak Services Agreement shall not be considered a material breach of this provision.

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(c)                                  Buyer shall deliver to Seller the portion of the Closing Cash Consideration allocable to Rollway Bearing as specified in the Master Allocation Statement, in immediately available funds by wire transfer to an account or accounts designated by Seller by notice to Buyer.

For U.S. federal income tax purposes, amounts delivered to Seller under Section 2.08(c) in respect of Rollway Bearing (as determined pursuant to Section 2.07(c)), shall be treated as having been paid to the Purchased Subsidiary holding the shares of Rollway Bearing and, immediately thereafter, distributed, directly or indirectly, to Seller or a Retained Subsidiary.

(d)                                 Seller shall cause the shareholder register of Rollway Bearing to be updated to reflect Buyer or its designee as the owner thereof.

(e)                                  Buyer shall deliver:

(i)                                     to the U.S. Escrow Agent, (v) the Philippine Consideration, (w) if a Deferred Closing occurs with respect to the India Deferred Business, the India Consideration, (x) if a Deferred Closing occurs with respect to the Brazil Deferred Business, the Brazil Consideration, (y) if a Deferred Closing occurs with respect to the UAE Deferred Business, the UAE Consideration and (z) if a Deferred Closing occurs with respect to the Slovakia Deferred Business, the Slovakia Consideration, in each case, in immediately available funds by wire transfer to an account designated by the U.S. Escrow Agent by written notice to Buyer;

(ii)                                  to the China Escrow Agent, if a Deferred Closing occurs with respect to the China Deferred Business, the China Consideration in immediately available funds to an account designated by the China Escrow Agent by written notice to Buyer;

(iii)                               to Seller, an amount equal to the Closing Cash Consideration less the amount delivered to Seller pursuant to Section 2.08(c) above less the China Consideration less the Philippine Consideration less the Brazil Consideration less the India Consideration less the UAE Consideration less if a Deferred Closing occurs with respect to the Slovakia Deferred Business, the Slovakia Consideration, in immediately available funds by wire transfer to an account or accounts designated by Seller, by notice to Buyer;

(iv)                              to Emerson Electric Brazil, if a Deferred Closing does not occur with respect to the Brazil Deferred Business, an amount equal to the Brazil Consideration in Brazilian reais in immediately available funds by wire transfer to an account or accounts designated by Seller, by notice to Buyer;

(v)                                 to Emerson Electric Holding Co. Ltd., if a Deferred Closing does not occur with respect to the China Deferred Business, an amount equal to the

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China Consideration in immediately available funds by wire transfer to an account or accounts designated by Seller, by notice to Buyer; and

(vi)                              to Emerson India, if a Deferred Closing does not occur with respect to the India Deferred Business, an amount equal to the India Consideration in Indian rupees, in immediately available funds by wire transfer to an account or accounts designated by Seller, by notice to Buyer.

(f)                                   Seller shall deliver, or cause the applicable Retained Subsidiaries to deliver to Buyer, certificates (to the extent such shares are held in certificated form) for the Domestic Subsidiary Shares and the Foreign Subsidiary Shares (other than Shares of Rollway Bearing and Shares of EPT China, if a Deferred Closing is to occur with respect to EPT China) duly endorsed or accompanied by stock powers duly endorsed in blank, with any required transfer stamps affixed thereto and accompanied by the applicable Foreign Transfer Agreement and such instruments that Seller and Buyer agree are reasonably necessary to validly transfer such Foreign Subsidiary Share to Buyer in accordance with Applicable Law.

Section 2.09.                          Foreign Transfer Agreements.  The transfer of each Purchased Foreign Subsidiary and the assignment of the Purchased Assets and assumption of the Assumed Liabilities relating to any portion of the Business located outside of the United States will, to the extent required by Applicable Law, be effected pursuant to individual short-form acquisition agreements (each a “Foreign Transfer Agreement”) on a country-by-country basis in substantially the form attached as Exhibit G to this Agreement; provided that, in each case, the Foreign Transfer Agreements shall serve purely to effect the legal transfer of the applicable Purchased Foreign Subsidiary or the assignment of such Purchased Assets and assumption of such Assumed Liabilities.  For the avoidance of doubt, (i) the Foreign Transfer Agreements shall not have any effect on the value being given or received by Seller or Buyer, including the allocation of assets and Liabilities as between them, all of which shall be determined solely in accordance with this Agreement (ii) the Foreign Transfer Agreements shall not have any effect on any of the rights of the parties set forth in this Agreement and (iii) in the event of any conflicts between any Foreign Transfer Agreement and this Agreement, the terms of this Agreement shall control in all respects.  Seller and Buyer shall not, and shall cause their respective Affiliates not to, bring any claim for any cause of action under any Foreign Transfer Agreement.

Section 2.10.                          Audit Adjustment; Dispute Resolution.  (a)  Following delivery of the Audited Financial Statements, the Purchase Price shall be adjusted (subject to Section 2.10(c)) (the “Audit Purchase Price Adjustment”) as follows:

(i)                                     if (A) Final PTS Audited Adjusted EBITDA is equal to or exceeds PTS Unaudited Adjusted EBITDA or (B) PTS Unaudited Adjusted EBITDA exceeds Final PTS Audited Adjusted EBITDA by $2,000,000 or less, the Audit Purchase Price Adjustment shall be zero; and

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(ii)                                  if PTS Unaudited Adjusted EBITDA exceeds Final PTS Audited Adjusted EBITDA by more than $2,000,000, the Audit Purchase Price Adjustment shall be an amount equal to (A) 11.71 multiplied by (B) PTS Unaudited Adjusted EBITDA minus Final PTS Audited Adjusted EBITDA minus $2,000,000.

(b)                                 The Audit Purchase Price Adjustment shall be determined as follows:

(i)                                     Seller shall promptly, and in any event, within three Business Days after receipt of the Audited Financial Statements from KPMG, deliver to Buyer such Audited Financial Statements together with a statement (the “EBITDA Statement”) setting forth in reasonable detail Seller’s calculation of PTS Audited Adjusted EBITDA (such amount, the “Initial PTS Audited Adjusted EBITDA”), and (subject to Buyer executing and delivering to KPMG a customary indemnity letter in form and substance reasonably satisfactory to KPMG) shall permit Buyer to review the work papers related to the Audited Financial Statements as promptly as practicable after the receipt of the Audited Financial Statements.

(ii)                                  If Buyer disagrees with Seller’s calculation of PTS Audited Adjusted EBITDA as set forth in the EBITDA Statement, Buyer may, within ten days after the later of the delivery of such statement and the date Buyer is first permitted to review the work papers related to the Audited Financial Statements deliver a written notice to Seller (an “EBITDA Dispute Notice”) disagreeing with such calculation and which specifies Buyer’s calculation of PTS Audited Adjusted EBITDA in reasonable detail, including specifying Buyer’s grounds for each point of disagreement (each, an “EBITDA Disputed Item”).  Buyer may deliver only one EBITDA Dispute Notice.

(iii)                               If Buyer duly delivers an EBITDA Dispute Notice, Buyer and Seller shall, during the 15 days following such delivery, use their reasonable best efforts to reach agreement on each EBITDA Disputed Item in order to determine the Final PTS Audited Adjusted EBITDA.  If Buyer and Seller are unable to reach such agreement during such period, they shall promptly thereafter appoint the Accounting Referee and cause such Accounting Referee to promptly review this Agreement and each EBITDA Disputed Item for purposes of determining Final PTS Audited Adjusted EBITDA.  In making such calculation, the Accounting Referee shall consider only the EBITDA Disputed Items.  The Accounting Referee shall deliver to Buyer and Seller, as promptly as practicable, a written report setting forth such calculation.  The cost of such review and report shall be borne (i) by Seller if (A) the difference between Final PTS Audited Adjusted EBITDA and Initial PTS Audited Adjusted EBITDA is greater than (B) the difference between Final PTS Audited Adjusted EBITDA and PTS Audited Adjusted EBITDA as set forth in the EBITDA Dispute Notice, (ii) by Buyer if the amount described in clause (B) above is greater than the amount described in

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clause (A) and (iii) otherwise equally between Buyer and Seller.  For purposes of this Section 2.10, “Final PTS Audited Adjusted EBITDA” means (i) PTS Audited Adjusted EBITDA as set forth in the EBITDA Statement if Buyer does not duly deliver an EBITDA Dispute Notice or (ii) if Buyer duly delivers an EBITDA Dispute Notice, (x) PTS Audited Adjusted EBITDA as mutually agreed by Buyer and Seller or (y) otherwise, PTS Audited Adjusted EBITDA as determined by the Accounting Referee; provided that, in no event will Final PTS Audited Adjusted EBITDA be more than Seller’s calculation thereof as set forth in the EBITDA Statement or less than Buyer’s calculation thereof as set forth in the EBITDA Dispute Notice.

(c)                                  Notwithstanding anything to the contrary in this Section 2.10, under no circumstances shall the Closing be conditioned upon, or delayed by, the determination of Final PTS Audited Adjusted EBITDA pursuant to this Section 2.10.  If the Closing Trigger Date has occurred, but Final PTS Audited Adjusted EBITDA has not been determined in accordance with this Section 2.10, at Closing the Audit Purchase Price Adjustment shall be determined using Initial PTS Audited Adjusted EBITDA and, within five Business Days after the determination of Final PTS Audited Adjusted EBITDA pursuant to Section 2.10(b) (but in no event before the Closing Date):

(i)                                     if the Audit Purchase Price Adjustment determined using Final PTS Audited Adjusted EBITDA exceeds the Audit Purchase Price Adjustment determined at Closing, Seller shall pay to Buyer the amount of such difference plus interest thereon from the Closing at the rate set forth in Section 2.15 by wire transfer of immediately available funds to an account designated by Buyer; and

(ii)                                  if the Audit Purchase Price Adjustment determined using Final PTS Audited Adjusted EBITDA is less than the Audit Purchase Price Adjustment determined at Closing, Buyer shall pay to Seller the amount of such difference plus interest thereon from the Closing at the rate set forth in Section 2.15 by wire transfer of immediately available funds to an account designated by Seller.

Section 2.11.                          Final Purchase Price Calculation.  (a) As promptly as practicable, but no later than 60 days after the Closing Date, Seller will cause to be prepared and delivered to Buyer a statement (the “Closing Statement”) setting forth Seller’s calculation of (i) Adjusted Base Modified Net Asset Value, the Modified Net Asset Value and the Modified Net Asset Value Adjustment based thereon, (ii) the Brazil Modified Net Asset Value and the Brazil Modified Net Asset Value Adjustment based thereon, (iii) Closing Cash and (iv) the Purchase Price based thereon.

(b)                                 If Buyer disagrees with Seller’s calculation of the Purchase Price as set forth in the Closing Statement, Buyer may, within 30 days after delivery of the Closing Statement, deliver a written notice to Seller (a “Dispute Notice”) disagreeing with such calculation and which specifies Buyer’s calculation of: (i) Adjusted Base Modified Net Asset Value, Modified Net Asset Value and the Modified Net Asset Value Adjustment

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based thereon, (ii) the Brazil Modified Net Asset Value and the Brazil Modified Net Asset Value Adjustment based thereon, (iii) Closing Cash and (iv) the Purchase Price based thereon, in each case, in reasonable detail, including specifying Buyer’s grounds for each point of disagreement.  Buyer may deliver only one Dispute Notice.  The Dispute Notice shall specify those items or amounts as to which Buyer disagrees (each, a “Disputed Item”), and Buyer shall be deemed to have agreed with all other items and amounts contained in the Closing Statement.

(c)                                  If Buyer duly delivers a Dispute Notice, Buyer and Seller shall, during the 30 days following such delivery, use their reasonable best efforts to reach agreement on each Disputed Item in order to determine the Purchase Price.  If Buyer and Seller are unable to reach such agreement during such period, they shall promptly thereafter jointly retain a nationally recognized accounting firm, who shall not have any material relationship with Buyer or Seller (the “Accounting Referee”) and cause such Accounting Referee promptly to review this Agreement and the Disputed Items for the purpose of calculating the Purchase Price.  In making such calculation, the Accounting Referee shall consider only the Disputed Items.  The Accounting Referee shall deliver to Buyer and Seller, as promptly as practicable, a written report setting forth such calculation.  Such report shall be final and binding upon Buyer and Seller.  The cost of such review and report shall be borne (i) by Seller if Seller is awarded less than 50% of the sum of all Disputed Items submitted to the Accounting Referee, (ii) by Buyer if Buyer is awarded less than 50% of the sum of all Disputed Items submitted to the Accounting Referee and (iii) otherwise equally by Buyer and Seller.

(d)                                 Buyer and Seller agree that they will, and agree to cause their respective independent accountants and Subsidiaries to, cooperate and assist in the preparation of the Closing Statement and the calculation of the Purchase Price and in the conduct of the reviews referred to in this Section 2.11, including the making available to the extent necessary of books, records, work papers and personnel.

(e)                                  For the avoidance of doubt, neither the calculations to be made pursuant to this Section 2.11, nor the purchase price adjustment to be made pursuant to Section 2.12 are intended to be used to adjust for errors or omissions that may be found with respect to the Balance Sheet, the Brazil Base Modified Net Asset Value or the Base Modified Net Asset Value, for which Article 11 shall be the sole and exclusive remedy.  No fact or event, including any market or business development, occurring on or after the Effective Time of the Closing, and no change in GAAP or Applicable Law after the date hereof, shall be taken into consideration in the calculations to be made pursuant to Section 2.11.  It is understood that (i) the Illustrative Modified Net Asset Value Statement set forth in Schedule II is attached only for the purposes set forth in the definition of “Modified Net Asset Value” and “Brazil Modified Net Asset Value” and (ii) the Base Modified Net Asset Value and Brazil Base Modified Net Asset Value are negotiated numbers derived independently of the Illustrative Modified Net Asset Value Statement.

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Section 2.12.                          Adjustment of Purchase Price.  (a) If the Final Purchase Price exceeds the Closing Cash Consideration, Buyer shall pay to Seller, in the manner and with interest as provided in Section 2.12(b), the amount of such excess.  If the Final Purchase Price is less than the Closing Cash Consideration, Seller shall pay to Buyer, in the manner and with interest as provided in Section 2.12(b), the amount of such difference.  The “Final Purchase Price” means the Purchase Price (x) as set forth in the Closing Statement if Buyer does not duly deliver a Dispute Notice or (y) if a Dispute Notice is delivered (A) as agreed between Seller and Buyer pursuant to Section 2.11(c) or (B) in the absence of such agreement, as determined by the Accounting Referee pursuant to Section 2.11(c); provided that in no event shall (I) Adjusted Base Modified Net Asset Value be less than Seller’s calculation thereof or more than Buyer’s calculation thereof, (II) Modified Net Asset Value or Brazil Modified Net Asset Value be more than Seller’s calculation thereof or less than Buyer’s calculation thereof or (III) Closing Cash be more than Seller’s calculation thereof or less than Buyer’s calculation thereof, in each case, as set forth in the Closing Statement and the Dispute Notice, respectively.

(b)                                 Any payment pursuant to this Section 2.12 shall be made by Buyer or Seller, as the case may be, at a mutually convenient time within five Business Days after the determination of the Final Purchase Price, by wire transfer of immediately available funds to such account or accounts of such other party as may be designated by such other party.

Section 2.13.                          Deferred Closing; Philippine Escrow.  (a) As of the Closing, if, and only if, (x) any of the actions specified in Section 2.13 of the Disclosure Schedule with respect to the assignment and assumption of the Purchased Assets and Assumed Liabilities of Emerson Slovakia, Emerson Electric Brazil or Emerson India or the purchase and sale of the shares of capital stock of EPT China have not been completed or (y) Buyer’s Affiliate in the United Arab Emirates has not obtained the Permits necessary to allow it to employ the Business Employees of Emerson UAE (together, the “Deferred Closing Actions”), then the closing of the transactions contemplated hereby (a “Deferred Closing”) with respect to the applicable Deferred Business shall take place as soon as possible following the Closing, but in any event within three Business Days, after the date on which all of the conditions described in Sections 2.13(b) and 2.13(c) are satisfied or, to the extent permitted by Applicable Law, waived with respect to the applicable Deferred Business (each, a “Deferred Closing Date”).

(b)                                 The obligation of Buyer to consummate a Deferred Closing with respect to a particular Deferred Business shall be subject to the satisfaction or, in the sole discretion of Buyer, waiver, at or prior to the applicable Deferred Closing Date, of each of the following conditions:

(i)                                     all Deferred Closing Actions in respect of such Deferred Business shall have been completed in all material respects; and

(ii)                                  no provision of any Applicable Law shall restrain, enjoin or prohibit the consummation of such Deferred Closing.

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(c)           The obligation of Seller to consummate any Deferred Closing with respect to a particular Deferred Business shall be subject to the satisfaction or, in the sole discretion of Seller, waiver, at or prior to the applicable Deferred Closing Date, of the following condition:  no provision of any Applicable Law shall restrain, enjoin or prohibit consummation of such Deferred Closing.

(d)           At each Deferred Closing, if any, with respect to a Deferred Business:

(i)            Buyer shall, or shall cause its Affiliates to, deliver to Seller any of the documents or other deliverables required to be delivered pursuant to Section 2.08 to the extent related to such Deferred Business and not previously delivered to Seller;

(ii)           Seller shall deliver, or cause to be delivered, to Buyer any of the documents required to be delivered pursuant to Section 2.08 to the extent related to such Deferred Business and not previously delivered by Seller;

(iii)          with respect to the Deferred Closing (if any) of the Slovakia Deferred Business, Seller and Buyer shall execute and deliver a joint written instruction to the U.S. Escrow Agent instructing it to release from the U.S. Escrow Account to Seller (or its designee) by wire transfer of immediately available funds to an account designated by Seller, an amount equal to the Slovakia Consideration plus interest thereon;

(iv)          with respect to the Deferred Closing (if any) of the UAE Deferred Business, Seller and Buyer shall execute and deliver a joint written instruction to the U.S. Escrow Agent instructing it to release from the U.S. Escrow Account to Seller (or its designee) by wire transfer of immediately available funds to an account designated by Seller, an amount equal to the UAE Consideration plus interest thereon;

(v)           with respect to the Deferred Closing (if any) of the India Deferred Business, (A) Seller and Buyer shall execute and deliver a joint written instruction to the U.S. Escrow Agent instructing it to release from the U.S. Escrow Account to Buyer (or its designee) by wire transfer of immediately available funds to an account designated by Buyer, an amount equal to the India Consideration, plus interest thereon and (B) Buyer shall cause its Indian Subsidiary that will acquire the Purchased Assets and assume the Assumed Liabilities of the Business owned by Emerson India to pay to Emerson India an amount in Indian rupees equal to the Indian Consideration plus the amount of interest earned on the Indian Consideration in the U.S. Escrow Account by wire transfer of immediately available funds to an account designated by Seller;

(vi)          with respect to the Deferred Closing (if any) of the Brazil Deferred Business, (A) Seller and Buyer shall execute and deliver a joint written instruction

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to the U.S. Escrow Agent instructing it to release from the U.S. Escrow Account to Buyer (or its designee) by wire transfer of immediately available funds to an account designated by Buyer, an amount equal to the Brazil Consideration, plus interest thereon and (B) Buyer shall cause its Brazilian Subsidiary that will acquire the Purchased Assets and assume the Assumed Liabilities of the Business owned by Emerson Electric Brazil to pay to Emerson Electric Brazil an amount in Brazilian reais equal to the Brazilian Consideration plus the amount of interest earned on the Brazilian Consideration in the U.S. Escrow Account by wire transfer of immediately available funds to an account designated by Seller; and

(vii)         with respect to the Deferred Closing (if any) of the China Deferred Business, Seller and Buyer shall execute and deliver a joint written instruction to the U.S. Escrow Agent instructing it to release from the U.S. Escrow Account to Seller (or its designee) by wire transfer of immediately available funds to an account designated by Seller, an amount equal to the China Consideration plus interest thereon.

(e)           Notwithstanding anything in this Agreement to the contrary, if (i), on the four-month anniversary of the Closing Date, any amount with respect to the Slovakia Consideration, the Brazil Consideration or the China Consideration remains on deposit in the U.S. Escrow Account, (ii) on the five-month anniversary of the Closing Date, any amount with respect to the UAE Consideration remains on deposit in the U.S. Escrow Account or (iii) on the six-month anniversary of the Closing Date, any amount with respect to the India Consideration remains on deposit in the U.S. Escrow Account (the aggregate of any such amount, the “Remaining Escrowed Funds”), interest shall accrue on the Remaining Escrowed Funds at a rate of 8% per annum, compounding monthly, from and including the Closing Date to but excluding the date the Remaining Escrowed Funds (or applicable portion thereof) is paid to Seller or its Affiliates.  Such interest shall be payable by the Buyer on a monthly basis commencing on the four-month anniversary of the Closing Date, in the case of any Remaining Escrowed Funds that comprise the Slovakia Consideration, Brazil Consideration or China Consideration, the five-month anniversary of the Closing Date, in the case of any Remaining Escrowed Funds that comprise the UAE Consideration and the six-month anniversary of the Closing Date, in the case of any Remaining Escrowed Funds that comprise the India Consideration by wire transfer of immediately available funds to an account designated by the Seller in writing.  Notwithstanding the provisions in Section 2.15, any payment required under this Section 2.13(e) that is not made when due shall accrue interest at a rate of 8% per annum from and including the date such payment was due to but excluding the date of payment. Notwithstanding anything in this Agreement to the contrary, Buyer shall not be required to pay interest on the applicable portion of any Remaining Escrowed Funds as set forth in this Section 2.13(e) if the failure to consummate the related Deferred Closing results solely due to either (i) Seller’s breach of its obligations under this Agreement or (ii) the relevant Governmental Authority failing to act in a timely manner notwithstanding Buyer’s full compliance with its obligations under Section 7.01.

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(f)            On the TSA Termination Date with respect to the employees of Emerson Philippines, (i) Buyer and Seller shall execute and deliver a joint written instruction to the U.S. Escrow Agent instructing the U.S. Escrow Agent to release from the U.S. Escrow Account to Buyer (or its designee) by wire transfer of immediately available funds to an account designated by Buyer, an amount equal to the Philippine Consideration plus interest thereon, (ii) Buyer shall cause its Philippine Subsidiary that will acquire the Purchased Assets and assume the Assumed Liabilities of the Business owned by Emerson Philippines to pay to Emerson Philippines an amount in Philippine pesos equal to the Philippine Consideration plus the interest accrued on the Philippine Consideration in the U.S. Escrow Account by wire transfer of immediately available funds to an account designated by Seller and (iii) Seller shall transfer, or cause to be transferred, to Buyer’s Philippine Subsidiary all of the Philippine Assets.

Section 2.14.         Obligations with Respect to Deferred Closings.(a) With respect to each Deferred Business, from the Closing Date until the applicable Deferred Closing Date, Buyer and Seller shall to the extent permitted by contractual obligation and Applicable Law, use reasonable best efforts to cooperate in a mutually agreeable arrangement under which Buyer (or one or more of its Affiliates) would, obtain the benefits, assume the obligations and bear the economic burdens associated with operating such Deferred Business; provided that, subject to Section 2.14(d) and Section 2.14(f), Seller and its Affiliates shall have no obligation to make any investment in, or to make any loan or other capital contribution to, such Deferred Business.  With respect to each Deferred Business, from the Closing Date through the applicable Deferred Closing Date, Seller shall and shall cause its Affiliates and any relevant Deferred Business (i) to conduct the applicable Deferred Business in the ordinary course consistent with past practice and (ii) not to, without the prior written consent of Buyer: