STOCK PURCHASE AGREEMENT

BY AND AMONG

MMI PRODUCTS, INC.
("Purchaser"),

STRUCTURAL REINFORCEMENT PRODUCTS, INC.
(the "Company")

AND

QUILNI B.V.
("Seller")

 

 

 

Dated December 27, 2002

ARTICLE I DEFINITIONS

1

1.1 Definitions 1

1.2 Interpretation 7

ARTICLE II SALE AND PURCHASE OF SHARES

8

2.1 Sale and Purchase 8

2.2 Payment of Purchase Price 8

2.3 Indebtedness 9

2.4 Closing Date Balance Sheet 9

2.5 Earnout 10

2.6 Assignment of Certain Accounts Receivable 11

2.7 Withholding of Tax 12

ARTICLE III REPRESENTATIONS AND WARRANTIES OF SELLER

12

3.1 Due Incorporation; Subsidiaries 12

3.2 Due Authorization 12

3.3 Consents and Approvals; Authority Relative to this Agreement 13

3.4 Capitalization; Liens 14

3.5 Financial Statements; Undisclosed Liabilities 14

3.6 No Adverse Effects or Changes 15

3.7 Title to Properties 16

3.8 Condition and Sufficiency of Assets 16

3.9 Real Property 17

3.10 Personal Property 17

3.11 Computer System 18

3.12 Inventories 18

3.13 Accounts Receivable and Advances 18

3.14 Intellectual Property 18

3.15 Contracts 19

3.16 Permits 20

3.17 Insurance 21

3.18 Employee Benefit Plans and Employment Agreements 21

3.19 Employment and Labor Matters 23

3.20 Capital Improvements 24

3.21 Taxes 24

3.22 No Defaults or Violations 26

3.23 Environmental Matters 26

3.24 Litigation 27

3.25 No Conflict of Interest 28

3.26 Bank Accounts 28

3.27 Customers and Suppliers 28

3.28 Improper and Other Payments 28

3.29 Brokers 29

3.30 Accuracy of Statements 29

ARTICLE IV REPRESENTATIONS AND WARRANTIES OF PURCHASER

29

4.1 Due Incorporation 29

4.2 Due Authorization 29

4.3 Consents and Approvals; Authority Relative to this Agreement 30

4.4 Litigation 30

4.5 Brokers 30

ARTICLE V COVENANTS

30

5.1 Implementing Agreement 30

5.2 Access to Information and Facilities 31

5.3 Preservation of Business 31

5.4 Consents and Approvals 33

5.5 Maintenance of Insurance 33

5.6 Resignation of Officers and Directors 34

5.7 Supplemental Information 34

5.8 Confidentiality 34

5.9 Exclusivity 34

5.10 Use of Name 34

5.11 Interim Financial Statements 34

5.12 Termination of Certain Agreements 35

5.13 Tax Matters/Financial Information 35

5.14 NOLs 35

ARTICLE VI CONDITIONS PRECEDENT TO OBLIGATIONS OF PURCHASER

36

6.1 Warranties True as of Both Present Date and Closing Date 36

6.2 Compliance with Agreements and Covenants 36

6.3 Certificate of Compliance 36

6.4 Consents and Approvals 36

6.5 No Material Adverse Change 36

6.6 Actions or Proceedings 36

ARTICLE VII CONDITIONS PRECEDENT TO OBLIGATIONS OF SELLER

37

7.1 Warranties True as of Both Present Date and Closing Date 37

7.2 Compliance with Agreements and Covenants 37

7.3 Certificate of Compliance 37

7.4 Consents and Approvals 37

7.5 Actions or Proceedings 37

ARTICLE VIII CLOSING

37

8.1 Closing 37

8.2 Deliveries by Seller 37

8.3 Deliveries by Purchaser 38

ARTICLE IX TERMINATION

39

9.1 Termination 39

9.2 Effect of Termination 39

ARTICLE X INDEMNIFICATION

40

10.1 Survival 40

10.2 Indemnification by Seller 40

10.3 Indemnification by Purchaser 40

10.4 Claims 41

10.5 Notice of Third Party Claims; Assumption of Defense 41

10.6 Settlement or Compromise 42

10.7 Failure of Indemnifying Person to Act 42

10.8 Purchase Price Adjustments 42

ARTICLE XI NON-COMPETITION

42

11.1 Non-Competition Agreement 42

11.2 Severability 43

11.3 No Limitation of Other Provisions 43

ARTICLE XII MISCELLANEOUS

43

12.1 Expenses 43

12.2 Amendment 43

12.3 Notices 43

12.4 Effect of Investigation 45

12.5 Payments in Dollars 45

12.6 Waivers 45

12.7 Counterparts 45

12.8 Assignment 45

12.9 No Third Party Beneficiaries 45

12.10 Publicity 45

12.11 Further Assurances 46

12.12 Severability 46

12.13 Specific Performance 46

12.14 Remedies Cumulative 46

12.15 Entire Understanding 46

12.16 Applicable Law 46

12.17 Jurisdiction of Disputes; Waiver of Jury Trial 47

 

 

 

EXHIBITS

Exhibit A Form of Opinion of Seller's Counsel

SCHEDULES

Definitions

1.1A Financial Statements

1.1B Related Agreements

Representations and Warranties of Sellers and the Company

3.1 Subsidiaries
3.3 Consents and Approvals
3.4 Capitalization; Liens
3.5 Undisclosed Liabilities
3.6 No Adverse Effects or Changes
3.7 Title to Properties
3.8 Condition and Sufficiency of Assets
3.9 Real Property
3.10 Personal Property
3.11 Computer System
3.12 Inventories
3.13 Accounts Receivable and Advances
3.14 Intellectual Property
3.15 Contracts
3.16 Permits
3.17 Insurance
3.18 Employee Benefit Plans and Employment Agreements
3.19 Employment and Labor Matters
3.20 Capital Improvements
3.21 Taxes
3.22 No Defaults or Violations
3.23 Environmental Matters
3.24 Litigation
3.25 No Conflict of Interest
3.26 Bank Accounts
3.27 Customers and Suppliers
3.28 Improper and Other Payments

Representations and Warranties of Purchaser

4.3 Consents and Approvals

Covenants

5.3 Preservation of Business
5.12 Termination of Certain Agreements

STOCK PURCHASE AGREEMENT

THIS AGREEMENT is made this 27th day of December, 2002, by and among MMI
PRODUCTS, INC., a Delaware corporation ("Purchaser"), STRUCTURAL REINFORCEMENT
PRODUCTS, INC., a Delaware corporation (the "Company") and QUILNI BV, a Dutch
corporation ("Seller"). Certain capitalized terms used herein are defined in
Article I.

W I T N E S S E T H:

WHEREAS, Purchaser wishes to purchase from Seller and Seller wishes to sell to
Purchaser all of the Shares.

NOW, THEREFORE, in consideration of the foregoing and the mutual
representations, warranties, covenants and agreements herein contained, the
parties agree as follows:

      
      DEFINITIONS

       1. Definitions. The following terms shall have the following meanings for
          the purposes of this Agreement:
      
          "Accounting Firm"
      
          shall have the meaning set forth in
          Section 2.4(c)
          .
      
          
      
          "Accounts Receivable"
      
          shall mean all accounts receivable, trade receivables, notes
          receivable and other receivables resulting from goods sold or services
          provided by the Company and shall include, as of the date hereof, all
          receivables listed on
          Schedule 3.13
          and, as of the Closing Date, all receivables recorded on the Closing
          Date Balance Sheet.
      
          
      
          "Adjusted Closing Date Balance Sheet"
      
          shall have the meaning set forth in
          Section 2.4(b)
          .
      
          
      
          "Advances"
      
          shall have the meaning set forth in
          Section 3.13
          .
      
          
      
          "Affiliate"
      
          shall mean, with respect to any specified Person, (1) any other Person
          which, directly or indirectly, owns or controls, is under common
          ownership or control with, or is owned or controlled by, such
          specified Person, (2) any other Person which is a director, officer or
          partner, or is, directly or indirectly, the beneficial owner of ten
          percent (10%) or more of any class of equity securities, of the
          specified Person or a Person described in clause (1) of this
          paragraph, (3) another Person of which the specified Person is a
          director, officer or partner or is, directly or indirectly, the
          beneficial owner of ten percent (10%) or more of any class of equity
          securities, (4) another Person in which the specified Person has a
          substantial beneficial interest or as to which the specified Person
          serves as trustee or in a similar capacity or (5) any relative or
          spouse of the specified Person or any of the foregoing Persons, any
          relative of such spouse or any spouse of any such relative;
          provided
          , that at any time after the Closing Date, the Company on the one hand
          and Seller and its Affiliates shall not be deemed to be Affiliates of
          each other.
      
          
      
          "Agreement"
      
          shall mean this Stock Purchase Agreement, including all exhibits and
          schedules hereto, as it may be amended from time to time in accordance
          with its terms.
      
          
      
          "Arrangements"
      
          shall have the meaning set forth in
          Section 3.18(a)
          .
      
          
      
          "Base Amount"
      
          shall have the meaning set forth in
          Section 2.5(a)
          .
      
          
      
          "Benefit Plans"
      
          shall have the meaning set forth in
          Section 3.18(b)
          .
      
          
      
          "Business Day"
      
          shall mean any day of the year other than (i) any Saturday or Sunday
          or (ii) any other day on which banks located in Texas or Pennsylvania
          generally are closed for business.
      
          
      
          "Closing"
      
          shall mean the consummation of the transactions contemplated herein in
          accordance with
          Article VIII
          .
      
          
      
          "Closing Date"
      
          shall mean the date on which the Closing occurs pursuant to
          Section 8.1
          .
      
          
      
          "Closing Date Balance Sheet"
      
          shall have the meaning set forth in
          Section 2.4(c)
          .
      
          
      
          "Code"
      
          shall mean the United States Internal Revenue Code of 1986, as
          amended.
      
          
      
          "Competing Person"
      
          shall have the meaning set forth in
          Section 11.1(a)
          .
      
          
      
          "Computer System"
      
          shall have the meaning set forth in
          Section 3.11
          .
      
          
      
          "Contract"
      
          shall mean any contract, lease, sales order, purchase order,
          agreement, warranty, indenture, mortgage, note, bond, right, warrant
          or instrument, whether written or verbal.
      
          
      
          "Dollars"
      
          or numbers preceded by the symbol "$" shall mean amounts in United
          States Dollars.
      
          
      
          "Earnout Amount"
      
          shall have the meaning set forth in
          Section 2.5(a)
          .
      
          
      
          "EBIT"
      
          shall have the meaning set forth in
          Section 2.5(a)
          .
      
          
      
          "Employment Agreements"
      
          shall have the meaning set forth in
          Section 3.18(a)
          .
      
          
      
          "Environmental Law"
      
          shall mean any Law that imposes liability or standards of conduct
          concerning, or otherwise relates to, protection of the environment or
          human health, including any Law relating to (i) emissions, discharges,
          releases or threatened releases into the environment, (ii) treatment,
          storage, or disposal of any waste, (iii) prevention, investigation,
          removal or remediation of contamination, and (iv) generation,
          management, or handling of any noise, odor, energy, matter or pathogen
          that may present substantial danger to public health or the
          environment. Without limiting the generality of the foregoing,
          "Environmental Laws" shall include the Comprehensive Environmental
          Response, Compensation and Liability Act, as amended, the Superfund
          Amendments and Reauthorization Act, as amended, the Resource
          Conservation and Recovery Act, as amended, the Toxic Substances
          Control Act, as amended, the Federal Water Pollution Control Act
          Amendments, as amended, the Clean Air Act as amended, any so-called
          "Superfund" or "Superlien" Law (including those already referenced in
          this definition) and any other Law having a similar subject matter.
      
          
      
          "Environmental Permit"
      
          shall mean any Permit required by or pursuant to any applicable
          Environmental Law.
      
          
      
          "Environmental Warranty"
      
          shall mean a representation or warranty in
          Section 3.23
          .
      
          
      
          "ERISA"
      
          shall mean the Employee Retirement Income Security Act of 1974, as
          amended.
      
          
      
          "ERISA Affiliate"
      
          shall mean, with respect to any Person, any corporation, trade or
          business which, together with such Person, is a member of a controlled
          group of corporations or a group of trades or businesses under common
          control within the meaning of sections 414 of the Code.
      
          
      
          "Extinguished Debt"
      
          shall have the meaning set forth in
          Section 2.3(a)
          .
      
          
      
          "Extinguished Debt Certificate"
      
          shall have the meaning set forth in
          Section 2.3(a)
          .
      
          
      
          "Final Working Capital Surplus"
      
          shall have the meaning set forth in
          Section 2.2(c)
          .
      
          
      
          "Financial Statements"
      
          shall mean all of the following:
      
          
      
           a. the audited financial statements of the Company as of December 31,
              2001 (including all notes thereto), which are included in Schedule
              1.1A, consisting of the balance sheet at such date and the related
              statements of earnings and retained earnings and cash flows for
              the fiscal year then ended; and
           b. the most recent unaudited financial statements of the Company that
              are included in Schedule 1.1A, consisting of the balance sheet at
              the last date of, and the related statements of earnings and
              retained earnings for, the period then ended.
      
          In addition, after the date of this Agreement, the term "Financial
          Statements" shall include any and all Interim Financial Statements
          then in existence.
      
          "GAAP"
      
          shall mean U.S. generally accepted accounting principles at the time
          in effect.
      
          
      
          "Governmental Authority"
      
          shall mean the government of the United States or any foreign country
          or any state or political subdivision thereof and any entity, body or
          authority exercising executive, legislative, judicial, regulatory or
          administrative functions of or pertaining to government, including any
          quasi-governmental entity established to perform such functions.
      
          
      
          "Hazardous Substance"
      
          shall mean any material, substance, pathogen or form of energy which
          (i) constitutes a "hazardous substance," "hazardous waste," "hazardous
          chemical," "hazardous material," "toxic substance," "pollutant" or
          "contaminant" (as such terms are defined by or pursuant to any
          Environmental Law) or (ii) is regulated or controlled by, or that
          could give rise to any liability under, any Environmental Law. Without
          limiting the generality of the foregoing, Hazardous Substance shall
          include any substance that contains petroleum, asbestos, or
          polychlorinated biphenyl or that is flammable, explosive or
          radioactive.
      
          
      
          "Indebtedness"
      
          with respect to any Person means any obligation of such Person for
          borrowed money whether or not reflected on the face of the balance
          sheet contained in the Financial Statements, and in any event shall
          include (i) any obligation incurred for all or any part of the
          purchase price of property or other assets or services or for the cost
          of property or other assets constructed or of improvements thereto,
          other than accounts payable included in current liabilities and
          incurred in the ordinary course of business, (ii) the face amount of
          all letters of credit issued for the account of such Person,
          (iii) obligations (whether or not such Person has assumed or become
          liable for the payment of such obligation) secured by Liens,
          (iv) capitalized lease obligations, (v) all guarantees of such Person,
          (vi) all accrued interest, fees and charges in respect of any amount
          described in this definition, and (vii) all prepayment premiums and
          penalties, and any other fees, expenses, indemnities and other
          amounts.
      
          
      
          "Indemnified Person"
      
          shall mean the Person or Persons entitled to, or claiming a right to,
          indemnification under
          Article X
          .
      
          
      
          "Indemnifying Person"
      
          shall mean the Person or Persons claimed by the Indemnified Person to
          be obligated to provide indemnification under
          Article X
          .
      
          
      
          "Intellectual Property"
      
          shall mean all United States and foreign patents (including
          continuations, continuations-in-part, reissues and re-examinations
          thereof) and patent applications; registered and unregistered trade
          names, trademarks, service names and service marks (and applications
          for registration of the same) and all goodwill associated therewith;
          copyrights and copyright registrations (and applications for the
          same); trade secrets; computer data (including formulations and
          analyses), computer programs and software (in source code and object
          code form) and firmware and all related programming, user and systems
          documentation; inventions, processes and designs (whether or not
          patentable or reduced to practice); know-how and formulae; and all
          other intellectual property rights and assets.
      
          
      
          "Interim Financial Statements"
      
          shall have the meaning set forth in
          Section 5.11
          .
      
          
      
          "IRS"
      
          shall mean the United States Internal Revenue Service.
      
          
      
          "Latest Balance Sheet"
      
          shall mean the unaudited balance sheet of the Company dated as of
          November 30, 2002 set forth in
          Schedule 1.1A
          .
      
          
      
          "Law"
      
          shall mean any law, statute, regulation, ordinance, rule, order,
          decree, judgment, common law decision, common law decision, consent
          decree, settlement agreement or governmental requirement enacted,
          promulgated, entered into, agreed to or imposed by any Governmental
          Authority.
      
          
      
          "Lender Pay-Off Letters"
      
          shall have the meaning set forth in
          Section 2.3(a)
          .
      
          
      
          "Licensed Intellectual Property"
      
          shall have the meaning set forth in
          Section 3.14
          .
      
          
      
          "Lien"
      
          shall mean any lien (except for any lien for Taxes not yet due and
          payable), mortgage, charge, restriction, pledge, security interest,
          option, lease, sublease or right of any third party.
      
          
      
          "Loss"
      
          or
          "Losses"
          shall mean any and all losses, liabilities, costs, claims, damages,
          penalties and expenses (including attorneys' fees and expenses and
          costs of investigation and litigation). In the event any of the
          foregoing are indemnifiable hereunder, the terms "Loss" and "Losses"
          shall include any and all attorneys' fees and expenses and costs of
          investigation and litigation incurred by the Indemnified Person in
          enforcing such indemnity.
      
          
      
          "Major Customer"
      
          shall have the meaning set forth in
          Section 3.27(a)
          .
      
          
      
          "Major Supplier"
      
          shall have the meaning set forth in
          Section 3.27(a)
          .
      
          
      
          "Material Adverse Change"
      
          shall mean a change (or circumstance involving a prospective change)
          in the business, operations, assets, liabilities, results of
          operations, cash flows, condition (financial or otherwise) or
          prospects of the Company which is materially adverse.
      
          
      
          "Material Adverse Effect"
      
          shall mean an effect (or circumstance involving a prospective effect)
          on the business, operations, assets, liabilities, results of
          operations, cash flows, condition (financial or otherwise) or
          prospects of the Company which is materially adverse.
      
          
      
          "Non-Competition Period"
      
          shall have the meaning set forth in
          Section 11.1
          .
      
          
      
          "Owned Intellectual Property"
      
          shall have the meaning set forth in
          Section 3.14
          .
      
          
      
          "Period"
      
          shall have the meaning set forth in
          Section 2.5(a)
          .
      
          
      
          "Permit"
      
          shall mean any permit, license, approval, consent or other
          authorization required or granted by any Governmental Authority.
      
          
      
          "Permitted Liens"
      
          shall mean those Liens set forth in
          Schedule 3.7
          and designated as "Permitted Liens."
      
          
      
          "Person"
      
          shall mean any individual, corporation, proprietorship, firm,
          partnership, limited partnership, limited liability company, trust,
          association or other entity.
      
          
      
          "Plans"
      
          shall have the meaning set forth in
          Section 3.18(a)
          .
      
          
      
          "Pre-Closing Tax Period"
      
          means any Tax period ending on or before the close of business on the
          Closing Date or, in the case of any Tax period which includes, but
          does not end on, the Closing Date, the portion of such period up to
          and including the Closing Date.
      
          
      
          "Preliminary Closing Date Balance Sheet"
      
          shall have the meaning set forth in
          Section 2.4(a)
          .
      
          
      
          "Preliminary Working Capital Surplus"
      
          shall have the meaning set forth in
          Section 2.2(b)
          .
      
          
      
          "Purchase Price"
      
          shall have the meaning set forth in
          Section 2.2
          .
      
          
      
          "Purchaser Indemnified Parties"
      
          shall mean Purchaser and each of its Affiliates (including, after the
          Closing, the Company), and their respective officers, directors,
          employees, agents and representatives; provided, that in no event
          shall Seller be deemed a Purchaser Indemnified Party.
      
          
      
          "Real Property"
      
          shall mean the parcels of land set forth on
          Schedule 3.9
          together with all privileges and easements appurtenant thereto, and
          any and all buildings, plants, facilities, installations, fixtures and
          other structures and improvements situated or located on such land or
          attached thereto.
      
          
      
          "Related Agreement"
      
          shall mean any Contract that is or is to be entered into at the
          Closing or otherwise pursuant to this Agreement. The Related
          Agreements executed by a specified Person shall be referred to as
          "such Person's Related Agreements," "its Related Agreements" or
          another similar expression. A list of Related Agreements is attached
          as
          Schedule 1.1 B
          .
      
          
      
          "Retained Indebtedness"
      
          shall mean any Indebtedness of the Company that Purchaser notifies
          Seller in writing on or before the Closing Date that it wishes to have
          the Company retain after the Closing Date.
      
          
      
          "Seller Indemnified Parties"
      
          shall mean Seller and its Affiliates, and their respective officers,
          directors, employees, agents and representatives;
          provided
          , that in no event shall the Company be deemed a Seller Indemnified
          Party.
      
          
      
          "Schlatter"
      
          shall mean Schlatter Holding AG, a Swiss Corporation.
      
          
      
          "Shares"
      
          shall mean, collectively, the 3,000 shares of Common Stock, $15.00 par
          value per share, of the Company held of record by Seller.
      
          
      
          "Stated Percentage"
      
          shall have the meaning set forth in
          Section 2.5(a)
          .
      
          
      
          "Subsidiaries"
      
          shall mean any Affiliate of the Company controlled directly or
          indirectly through one or more intermediaries.
      
          
      
          "Taxes"
      
          shall mean all taxes, charges, fees, duties (including customs
          duties), levies or other assessments, including income, gross
          receipts, net proceeds, ad valorem, turnover, real and personal
          property (tangible and intangible), sales, use, franchise, excise,
          goods and services, value added, stamp, leasing, lease, user,
          transfer, fuel, excess profits, occupational, interest equalization,
          windfall profits, severance, license, payroll, environmental, capital
          stock, disability, employee's income withholding, other withholding,
          unemployment and Social Security taxes, which are imposed by any
          Governmental Authority, and such term shall include any interest,
          penalties or additions to tax attributable thereto.
      
          
      
          "Tax Return"
      
          shall mean any report, return or other information required to be
          supplied to a Governmental Authority or any other person in connection
          with any Taxes.
      
          
      
          "Tax Statute of Limitations Date"
      
          shall mean the close of business on the forty-fifth (45
          th
          ) day after the expiration of the applicable statute of limitations
          with respect to Taxes, including any extensions thereof (or if such
          date is not a Business Day, the next Business Day).
      
          
      
          "Tax Warranty"
      
          shall mean a representation or warranty in
          Section 3.18
          or
          3.21
          .
      
          
      
          "Title and Authorization Warranty"
      
          shall mean a representation or warranty in
          Section 3.1
          ,
          3.2
          ,
          3.3
          ,
          3.4
          ,
          3.7
          ,
          4.1
          ,
          4.2
          or
          4.3
          .
      
          
      
          "Working Capital"
      
          means cash and cash equivalents plus Accounts Receivable plus
          inventories plus prepaid expenses less accounts payable and non-Seller
          related accrued liabilities of the Company, determined on a
          consolidated basis in accordance with GAAP. Current deferred income
          Taxes of the Company will be disregarded in determining Working
          Capital.
      
          
      
          "Working Capital Deficiency"
      
          shall mean the amount (if any) by which the Company's Working Capital
          immediately prior to the Closing is less than Three Million Seven
          Hundred Six Thousand Dollars ($3,706,000). If such amount is not less
          than Three Million Seven Hundred Six Thousand Dollars ($3,706,000),
          the Working Capital Deficiency shall be deemed to be zero.
      
          
      
          "Working Capital Surplus"
      
          shall mean the amount (if any) by which the Company's Working Capital
          immediately prior to the Closing is greater than Three Million Seven
          Hundred Six Thousand Dollars ($3,706,000). If such amount is not
          greater than Three Million Seven Hundred Six Thousand Dollars
          ($3,706,000), the Working Capital Surplus shall be deemed to be zero.
      
          
      
       2. Interpretation. The headings preceding the text of Articles and
          Sections included in this Agreement and the headings to Schedules
          attached to this Agreement are for convenience only and shall not be
          deemed part of this Agreement or be given any effect in interpreting
          this Agreement. The use of the masculine, feminine or neuter gender or
          the singular or plural form of words herein shall not limit any
          provision of this Agreement. The use of the terms "including" or
          "include" shall in all cases herein mean "including, without
          limitation" or "include, without limitation," respectively. Reference
          to any Person includes such Person's successors and assigns to the
          extent such successors and assigns are permitted by the terms of any
          applicable agreement, and reference to a Person in a particular
          capacity excludes such Person in any other capacity or individually.
          Reference to any agreement (including this Agreement), document or
          instrument means such agreement, document or instrument as amended or
          modified and in effect from time to time in accordance with the terms
          thereof and, if applicable, the terms hereof. Reference to any Law
          means such Law as amended, modified, codified, replaced or re-enacted,
          in whole or in part, including rules, regulations, enforcement
          procedures and any interpretations promulgated thereunder. Underscored
          references to Articles, Sections, Subsections or Schedules shall refer
          to those portions of this Agreement. The use of the terms "hereunder,"
          "hereof," "hereto" and words of similar import shall refer to this
          Agreement as a whole and not to any particular Article, Section or
          clause of or Exhibit or Schedule to this Agreement. No specific
          representation, warranty or covenant contained herein shall limit the
          generality or applicability of a more general representation, warranty
          or covenant contained herein. A breach of or inaccuracy in any
          representation, warranty or covenant shall not be affected by the fact
          that any more general or less general representation, warranty or
          covenant was not also breached or inaccurate.

      
      SALE AND PURCHASE OF SHARES

       1. Sale and Purchase. Subject to the terms and conditions of this
          Agreement, on the Closing Date, Seller shall sell to Purchaser all of
          the Shares free and clear of all Liens, and Purchaser shall purchase
          all of the Shares.
       2. Payment of Purchase Price. The total consideration for the Shares and
          the non-competition agreements contained in Article XI shall consist
          of the following payments as adjusted pursuant to Sections 2.4 and 2.5
          (collectively, the "Purchase Price"):
           a. On the Closing Date, Purchaser shall pay to Seller Twenty Three
              Million Dollars ($23,000,000) less the amount of the Retained
              Indebtedness.
           b. On the forty-fifth day (45th) day after the Closing Date, if there
              is a Working Capital Surplus reflected on the Preliminary Closing
              Date Balance Sheet (the "Preliminary Working Capital Surplus"),
              Purchaser shall pay to Seller the amount of such surplus.
           c. On the date later of (i) the first anniversary of the Closing Date
              and (ii) the third Business Day after the Closing Date Balance
              Date Sheet becomes final and binding in accordance with Section
              2.4, (x) if there is a Working Capital Surplus reflected on the
              Closing Date Balance Sheet (the "Final Working Capital Surplus")
              that is greater than the Preliminary Working Capital Surplus,
              Purchaser shall pay to Seller the amount of such excess surplus;
              (y) if there is a Final Working Capital Surplus that is less than
              the Preliminary Working Capital Surplus and/or there is a Working
              Capital Deficiency, Seller shall pay to Purchaser the aggregate
              amount of such deficiency.
           d. In addition, Purchaser shall pay to Seller $900,000 on each of the
              first, second and third anniversary dates of the Closing Date,
              $800,000 on the fourth anniversary date of the Closing Date and
              $750,000 on the fifth anniversary date of the Closing Date. The
              payments under this Section 2.2(d) shall total $4,250,000.
           e. Within sixty (60) days of the end of each calendar year from and
              including 2003 through and including 2010, Purchaser shall pay
              Seller Ten Thousand Dollars ($10,000.00) for each 100 tons of
              aggregate production of welded wire mesh that is not "building
              mesh" (as defined by the Wire Reinforcement Institute) from the
              303, 201 and 215 machines currently owned by the Company in excess
              of an aggregate of 42,000 tons only if the aggregate of such
              production exceeds 42,500 tons for such calendar year. In the
              event that Purchaser removes any of the 303, 201 and 215 machines
              from the Company prior to December 31, 2010, Purchaser and Seller
              shall make appropriate mutually agreed upon adjustment to the
              foregoing formula.
           f. Purchaser shall pay Seller the Earnout Amount as provided in
              Section 2.5.
           g. If any payment date falls on a day which is not a Business Day,
              then payment shall be made on the next succeeding Business Day.
           h. All payments made hereunder shall be made in accordance with
              Section 12.5 and to such account or accounts as the receiving
              party or parties shall designate in writing to the paying party.
      
       3. Indebtedness. At the Closing, Seller, on behalf of the Company, shall:
           a. pay all principal of, premium, if any, expenses and other amounts
              owing to the holders of Indebtedness of the Company including all
              deferred financing, pre-payment penalties and other costs
              associated therewith (if any) and the current portion thereof but
              excluding any Retained Indebtedness (the "Extinguished Debt"), as
              all such amounts are set forth in the pay-off and discharge
              letters by such lenders and delivered to the Company and Purchaser
              at the Closing (the "Lender Pay-Off Letters"); provided that
              Purchaser shall pay one half (1/2) of all prepayment penalties or
              make-whole payments, if any, with respect to the Extinguished
              Debt. The amounts referred to in this Section 2.3(a) will be set
              forth in a certificate of the Company's Chief Financial Officer
              and delivered to Purchaser at the Closing (the "Extinguished Debt
              Certificate");
           b. subject to Section 2.3(a), pay transaction fees and expenses
              incurred or payable by the Company or Seller, in connection with
              this Agreement and the Related Agreements and the transactions
              contemplated hereby and thereby in accordance with this Agreement;
              and
           c. pay all interest, if any, on amounts owing to the holders of the
              Extinguished Debt as such interest amount (a) is set forth in the
              Lender Pay-Off Letters, and (b) is not paid or otherwise satisfied
              by the Company at the Closing. Seller and Purchaser shall
              cooperate in all reasonable efforts to reduce or eliminate any
              prepayment penalties related to the Extinguished Indebtedness.
      
       4. Closing Date Balance Sheet.
           a. Within forty (40) days after the Closing Date, Purchaser shall
              prepare and deliver to Seller, at Purchaser's expense, an
              unaudited balance sheet for the Company as of the Closing Date
              (the "Preliminary Closing Date Balance Sheet"), which shall be
              prepared by Purchaser in accordance with GAAP on a consistent
              basis. Promptly upon Seller's request, Purchaser shall make
              available to Seller copies of the work papers and back-up
              materials used by Purchaser in preparing the Preliminary Closing
              Date Balance Sheet and such other documents as Seller may
              reasonably request in connection with its review of the
              Preliminary Closing Date Balance Sheet.
           b. Within ninety (90) days after the first anniversary of the Closing
              Date, Purchaser shall prepare and deliver to Seller, at
              Purchaser's expense, an unaudited balance sheet for the Company as
              of the Closing Date (the "Adjusted Closing Date Balance Sheet"),
              which shall be prepared by Purchaser in accordance with GAAP on a
              consistent basis and which shall be adjusted to reflect changes to
              the elements of Working Capital set forth on the Preliminary
              Closing Date Balance Sheet that have or have not been converted to
              cash or been utilized in the operation of the Company's business,
              as well as elements for which reserves, accruals and/or balances
              have proven to be inaccurate with hindsight. In particular, the
              Adjusted Closing Date Balance Sheet shall reflect full reserves
              for any Accounts Receivable that remain uncollected on the first
              anniversary of the Closing Date, any inventory owned by the
              Company on the Closing Date that remains unused or unsold on the
              first anniversary of the Closing Date and any warranty claims or
              other liabilities that relate to the pre-Closing period, in each
              case in excess of the reserves related thereto. Promptly upon
              Seller's request, Purchaser shall make available to Seller copies
              of the work papers and back-up materials used by Purchaser in
              preparing the Adjusted Closing Date Balance Sheet and such other
              documents as Seller may reasonably request in connection with its
              review of the Adjusted Closing Date Balance Sheet. Purchaser
              undertakes to cause the Company to use its commercially reasonable
              efforts to collect all accounts receivables and to utilize all
              inventory currently on the books in accordance with the Company's
              past practices and in the ordinary course of its business.
           c. Within thirty (30) days after receipt of the Adjusted Closing Date
              Balance Sheet, Seller shall deliver to Purchaser a written
              statement describing its objections (if any) to the Adjusted
              Closing Date Balance Sheet. If Seller does not raise any
              objections in a written statement within such thirty (30)-day
              period, the Adjusted Closing Date Balance Sheet shall become final
              and binding upon all parties. The final and binding Adjusted
              Closing Date Balance Sheet is referred to as the "Closing Date
              Balance Sheet". If Seller does raise objections in a written
              statement within such thirty (30)-day period, and the parties
              cannot resolve such objections within ten (10) Business Days after
              the receipt by Purchaser of Seller's written statement of
              objections, any remaining disputes shall be resolved by
              PriceWaterhouseCoopers or another nationally recognized
              independent accounting firm mutually agreeable to Purchaser and
              Seller (the "Accounting Firm"). The Accounting Firm shall be
              instructed to resolve such disputes within thirty (30) days after
              its appointment. The resolution of disputes by the Accounting Firm
              shall be set forth in writing and shall be conclusive and binding
              upon all parties and the Adjusted Closing Date Balance Sheet, as
              modified by such resolution, shall become final and binding upon
              the date of such resolution. The fees and expenses of the
              Accounting Firm shall be apportioned by the Accounting Firm based
              on the degree to which each party's claims were unsuccessful and
              shall be paid by the parties in accordance with such
              determination. For example, if pursuant to this Section 2.4(c)
              Seller submitted an objection affecting the Purchase Price in the
              amount of $100,000 and prevailed as to $45,000 of the amount, then
              Seller would bear fifty-five percent (55%) of the fees and
              expenses of the Accounting Firm.
      
       5. Earnout. Within thirty (30) days following completion of the Company's
          audited financial statements for each of 2004, 2005, 2006, 2007 and
          2008 fiscal years (each such year a "Period"), Purchaser shall pay to
          Seller an amount (the "Earnout Amount"), if any, equal to the Stated
          Percentage of the excess of EBIT for such Period over the Base Amount
          for such Period.
      
          The "Stated Percentage" for each Period shall be as follows:
      
          Fiscal Year
          
          Stated Percentage
          
          2004
          
          30%
          
          2005
          
          35%
          
          2006
          
          40%
          
          2007
          
          40%
          
          2008
          
          40%
      
          The "Base Amount" for each Period shall be as follows:
      
          Fiscal Year
          
          Base Amount
          
          
          (in millions)
          
          2004
          
          $3.9
          
          2005
          
          4.8
          
          2006
          
          5.175
          
          2007
          
          5.6
          
          2008
          
          5.8
      
          "EBIT"
      
          means, for any Period, the consolidated net income of the Company's
          Hazleton plant, after restoring thereto amounts deducted in respect of
          (i) interest, (ii) taxes on income, and (iii) corporate overhead
          charges, management charges and any other similar payments, if any, to
          Purchaser or its Affiliates; provided that a proportionate share of
          the Company's and/or Purchaser's cost of health care coverage,
          employee benefits, workers' compensation programs and other insurance
          amounts as the costs of such programs relate to the Hazleton plant and
          its employees would not be restored, in a manner consistent with the
          Company's current calculations of operating profit and depreciation
          (including book values and depreciation methods associated with the
          fixed assets of the Company on the Closing Date). Compensation and
          expenses of sales people assigned to sell products manufactured at the
          Hazleton plant will be reflected in the calculation of EBIT on a pro
          rata basis. For avoidance of doubt, payments to Seller under this
          Agreement shall not be treated as a deduction to reach EBIT. In
          addition, EBIT shall be calculated based on the equipment housed at
          the Hazleton plant on the Closing Date. In the event that the Company,
          adds additional equipment at the Hazleton plant after the Closing
          Date, the calculation of EBIT shall exclude the EBIT associated
          therewith.
      
          
      
           a. Each Earnout Amount shall be certified as having been determined
              in good faith by a financial officer of the Company or Purchaser
              in accordance with the definition of EBIT above, with supporting
              calculations and copies of the Company's financial statements
              (including any audited statements) relating to such period and not
              previously provided to Seller. Access to the Company's records, to
              the extent necessary to verify any amounts payable, shall be
              provided upon Seller's reasonable request. In the event that
              Seller shall dispute such determination, Seller may, at its own
              expense, submit the matter to the Accounting Firm or another
              accounting firm mutually acceptable to Seller and Purchaser, whose
              determination shall be final and binding, provided, that if the
              determination by such firm results in an increase in the Earnout
              Amount over the amount certified by a financial officer of the
              Company or Purchaser by the greater of (i) $50,000 or (ii) five
              percent (5%), Purchaser shall be responsible for the fees and
              expenses of such firm in connection with such matter.
      
       6. Assignment of Certain Accounts Receivable. In the event that Purchaser
          makes any claim pursuant to Section 2.4 for any Accounts Receivable
          recorded on the Closing Date Balance Sheet that have not been
          collected within twelve (12) months after the Closing Date, Purchaser
          shall assign and transfer to Seller or a party designated by Seller,
          without recourse, such uncollected Accounts Receivable and Seller
          shall accept such uncollected Accounts Receivable that have been so
          assigned and transferred. Purchaser shall deliver to Seller any
          documents reasonably requested by Seller evidencing any Accounts
          Receivable that are so assigned and transferred.
       7. Withholding of Tax. Purchaser will be entitled to deduct and withhold
          from the Purchase Price otherwise payable pursuant to this Agreement
          to Seller such amounts as Purchaser shall determine in good faith it
          is required to deduct and withhold with respect to the making of such
          payment under the Code, or any provision of federal, state, local or
          foreign Tax law. To the extent that amounts are so withheld by
          Purchaser, such withheld amounts will be treated for all purposes of
          this Agreement as having been paid to Seller in respect of whom such
          deduction and withholding were made by Purchaser. It is the
          expectation of Seller that no such withholding will be required. In
          the event that Purchaser is of the preliminary view that any
          withholding will be required, Purchaser will provide Seller with
          advance notice of such views, and accord Seller the opportunity to
          respond.

      
      REPRESENTATIONS AND WARRANTIES OF SELLER

      Seller represents and warrants to Purchaser, as of the date of this
      Agreement, as follows:

       1.  Due Incorporation; Subsidiaries. The Company is duly organized,
           validly existing and in good standing under the laws of the State of
           Delaware, with all requisite corporate power and authority to own,
           lease and operate its properties and to carry on its business as they
           are now being owned, leased, operated and conducted. The Company is
           licensed or qualified to do business and is in good standing as a
           foreign corporation in each jurisdiction where the nature of the
           properties owned, leased or operated by it or the business transacted
           by it require such licensing or qualification. The jurisdictions in
           which the Company is incorporated and licensed or qualified to do
           business as a foreign corporation are set forth on Schedule 3.1. The
           Company has no direct or indirect Subsidiaries, either wholly or
           partially owned, and the Company does not hold any direct or indirect
           economic, voting or management interest in any Person or directly or
           indirectly own any security issued by any Person. True, correct and
           complete copies of the Certificate of Incorporation and by-laws (or
           similar organizational instruments), and all minutes of all meetings
           (or written consents in lieu of meetings) of the Board of Directors
           (and all committees thereof) and stockholders, of the Company have
           been delivered to Purchaser. Except as set forth in Schedule 3.1, all
           action taken by the Boards of Directors (and all committees thereof)
           and stockholders of the Company is reflected in such minutes and
           written consents.
       2.  Due Authorization.
            a. Seller and Schlatter each has full corporate power and authority
               to enter into this Agreement and its Related Agreements and to
               consummate the transactions contemplated hereby and thereby.
               Seller and Schlatter each has duly and validly executed and
               delivered this Agreement and has duly and validly executed and
               delivered (or prior to or at the Closing will duly and validly
               execute and deliver) its Related Agreements. This Agreement
               constitutes legal, valid and binding obligations of each of
               Seller and Schlatter and each of its Related Agreements
               constitute (or upon execution and delivery by Seller or
               Schlatter, as applicable, will constitute) legal, valid and
               binding obligations of Seller and Schlatter, in each case,
               enforceable in accordance with their respective terms, except as
               such enforceability may be limited by applicable bankruptcy,
               insolvency, moratorium, reorganization or similar laws in effect
               that affect the enforcement of creditors' rights generally and by
               equitable limitations on the availability of specific remedies.
            b. The Company has full corporate power and authority to enter into
               this Agreement and its Related Agreements and to consummate the
               transactions contemplated hereby and thereby. The execution,
               delivery and performance by the Company of this Agreement and its
               Related Agreements, and the consummation by the Company of the
               transactions contemplated hereby and thereby, have been duly and
               validly approved by its board of directors, and no other actions
               or proceedings on the part of the Company are necessary to
               authorize this Agreement or its Related Agreements and the
               transactions contemplated hereby and thereby. The Company has
               duly and validly executed and delivered this Agreement and has
               duly and validly executed and delivered (or prior to or at the
               Closing will duly and validly execute and deliver) its Related
               Agreements. This Agreement constitutes legal, valid and binding
               obligation of the Company and each of the Company's Related
               Agreements constitute (or upon execution and delivery by the
               Company will constitute) legal, valid and binding obligations of
               the Company, in each case, enforceable in accordance with their
               respective terms, except as such enforceability may be limited by
               applicable bankruptcy, insolvency, moratorium, reorganization or
               similar laws in effect that affect the enforcement of creditors'
               rights generally and by equitable limitations on the availability
               of specific remedies.
      
       3.  Consents and Approvals; Authority Relative to this Agreement.
            a. Except as set forth on Schedule 3.3, no consent, authorization or
               approval of, filing or registration with, waiver of any right of
               first refusal or first offer from, or cooperation from, any
               Governmental Authority or any other Person is necessary in
               connection with the execution, delivery and performance by
               Seller, Schlatter or the Company of this Agreement and the
               execution, delivery and performance by Seller, Schlatter or the
               Company of their respective Related Agreements or the
               consummation by each Seller, Schlatter and the Company of the
               transactions contemplated hereby or thereby.
            b. Except as set forth on Schedule 3.3, the execution, delivery and
               performance by Seller, Schlatter and the Company of this
               Agreement and the execution, delivery and performance by Seller,
               Schlatter and the Company of their respective Related Agreements,
               and the consummation by Seller, Schlatter and the Company of the
               transactions contemplated hereby and thereby, do not and will not
               (i) violate any Law applicable to or binding on Seller, Schlatter
               or the Company or any of their respective assets or properties;
               (ii) violate or conflict with, result in a breach or termination
               of, constitute a default or give any third party any additional
               right (including a termination right) under, permit cancellation
               of, result in the creation of any Lien upon any of the assets or
               properties of Seller, Schlatter or the Company under, or result
               in or constitute a circumstance which, with or without notice or
               lapse of time or both, would constitute any of the foregoing
               under any Contract to which Seller, Schlatter or the Company is a
               party or by which Seller, Schlatter or the Company or any of
               their respective assets or properties, are bound; (iii) permit
               the acceleration of the maturity of any indebtedness of Seller,
               Schlatter or the Company or indebtedness secured by their
               respective assets or properties; or (iv) violate or conflict with
               any provision of any of the Certificate of Incorporation or
               by-laws of the Company.
      
       4.  
           Capitalization; Liens
           .
            a. The authorized capital stock of the Company consists of 3,000
               shares of Common Stock, $15.00 par value per share, all of which
               are currently issued and outstanding and constitute the Shares.
               All of the Shares (i) are validly issued, fully paid and
               nonassessable and (ii) are, and when issued were, free of
               preemptive rights. Seller is the legal and beneficial owner of
               all of the Shares, free and clear of any and all Liens other than
               as set forth on Schedule 3.4(a). There are no shares of capital
               stock of the Company held in the treasury of the Company and no
               shares of capital stock of the Company are currently reserved for
               issuance for any purpose or upon the occurrence of any event or
               condition.
            b. Except as set forth above or in Schedule 3.4(b), there are no
               shares of capital stock or other securities (whether or not such
               securities have voting rights) of the Company issued or
               outstanding or any subscriptions, options, warrants, calls,
               rights, convertible securities or other agreements or commitments
               of any character obligating Seller or the Company, or obligating
               Seller or any of its Affiliates to cause the Company, to issue,
               transfer or sell, or cause the issuance, transfer or sale of, any
               shares of capital stock or other securities (whether or not such
               securities have voting rights) of the Company. Except as set
               forth in Schedule 3.4(b), there are no outstanding contractual
               obligations of Seller or the Company that relate to the purchase,
               sale, issuance, repurchase, redemption, acquisition, transfer,
               disposition, holding or voting of any shares of capital stock or
               other securities of the Company or the management or operation of
               the Company. Except for Seller's rights as holder of Shares and
               except for employee benefit plans or bonus arrangements disclosed
               pursuant to Section 3.18, no Person has any right to participate
               in, or receive any payment based on any amount relating to, the
               revenue, income, value or net worth of the Company or any
               component or portion thereof, or any increase or decrease in any
               of the foregoing.
            c. The assignments, endorsements, stock powers and other instruments
               of transfer delivered by Seller to Purchaser at the Closing will
               be sufficient to transfer to Purchaser the entire interest, legal
               and beneficial, in the Shares. Seller has, and on the Closing
               Date will have, full power and authority to convey good and
               marketable title to all of the Shares transferred by Seller, and
               upon transfer by Seller to Purchaser of the certificates
               representing such Shares, Purchaser will receive good and
               marketable title to such Shares, free and clear of all Liens.
      
       5.  Financial Statements; Undisclosed Liabilities.
            a. The Financial Statements have been prepared in accordance with
               GAAP consistently applied and present fairly the financial
               position, assets and liabilities of the Company as of the dates
               thereof and the results of operations, revenues, expenses and
               cash flows of the Company for the periods covered thereby. The
               Financial Statements are in accordance with the books and records
               of the Company, do not reflect any transactions that are not bona
               fide transactions and do not contain any untrue statement of a
               material fact or omit to state any material fact necessary to
               make the statements contained therein, in light of the
               circumstances in which they were made, not misleading.
            b. Except as set forth in Schedule 3.5 or in the Latest Balance
               Sheet, the Company has no liabilities, debts, claims or
               obligations, whether accrued, absolute, contingent or otherwise,
               whether due or to become due, other than trade payables and
               accrued expenses incurred in the ordinary course of business and
               consistent with past practice since the date of the Latest
               Balance Sheet.
      
       6.  No Adverse Effects or Changes.
            a. Except as listed on Schedule 3.6, since the date of the Latest
               Balance Sheet the Company has not:
                i.    suffered any Material Adverse Effect;
                ii.   suffered any damage, destruction or Loss to any of its
                      assets or properties (whether or not covered by insurance)
                      in excess of $10,000 individually or $20,000 in the
                      aggregate which has not been repaired;
                iii.  taken any action or entered into or authorized any
                      Contract or transaction other than in the ordinary course
                      of business and consistent with past practice;
                iv.   sold, conveyed, assigned or otherwise transferred any of
                      its assets or properties, except sales of inventory in the
                      ordinary course of business and consistent with past
                      practice;
                v.    waived, released or canceled any material claims against
                      third parties or debts owing to it, or any rights which
                      have any value (in the case of debts or right with value
                      in excess of $20,000 in the aggregate);
                vi.   made any changes in its accounting systems, policies,
                      principles, practices or methods;
                vii.  entered into, authorized or permitted any transaction with
                      Seller, Schlatter or any of their Affiliates;
                viii. authorized for issuance, issued, sold, delivered or agreed
                      or committed to issue, sell or deliver (whether through
                      the issuance or granting of options, warrants, convertible
                      or exchangeable securities, commitments, subscriptions,
                      rights to purchase or otherwise) any shares of its capital
                      stock or any other securities, or amended any of the terms
                      of any such securities;
                ix.   split, combined or reclassified any shares of its capital
                      stock, declared, set aside or paid any dividend or other
                      distribution (whether in cash, stock or property or any
                      combination thereof) in respect of its capital stock, or
                      redeemed or otherwise acquired any securities of the
                      Company;
                x.    made any borrowings, incurred any debt (other than trade
                      payables, draws under the Company's existing revolving
                      line of credit and other business expenses not in excess
                      of $10,000 in the aggregate, all of which have been made
                      or incurred in the ordinary course of business and
                      consistent with past practice), or assumed, guaranteed,
                      endorsed (except for the negotiation or collection of
                      negotiable instruments in transactions in the ordinary
                      course of business and consistent with past practice) or
                      otherwise become liable (whether directly, contingently or
                      otherwise) for the obligations of any other Person, or
                      made any payment or repayment in respect of any
                      indebtedness to any Affiliates of the Company or other
                      than in the ordinary course of business and consistent
                      with past practice);
                xi.   made any loans, advances or capital contributions to, or
                      investments in, any other Person;
                xii.  entered into, adopted, amended or terminated any bonus,
                      profit sharing, compensation, termination, stock option,
                      stock appreciation right, restricted stock, performance
                      unit, pension, retirement, deferred compensation,
                      employment, severance or other employee benefit agreement,
                      trust, plan, fund or other arrangement for the benefit or
                      welfare of any director, officer or employee, or increased
                      in any manner the compensation or fringe benefits of any
                      director, officer or employee or paid any benefit not
                      required by any existing plan and arrangement or entered
                      into any contract, agreement, commitment or arrangement to
                      do any of the foregoing;
                xiii. acquired, leased or encumbered any assets outside the
                      ordinary course of business or any assets which are
                      material to the Company;
                xiv.  made any Tax election or settled or compromised any
                      federal, state, local or foreign Tax liability, or waived
                      or extended the statute of limitations in respect of any
                      such Taxes;
                xv.   paid any amount, performed any obligation or agreed to pay
                      any amount or perform any obligation, in settlement or
                      compromise of any suits or claims of liability against the
                      Company or any of its directors, officers, employees or
                      agents; or
                xvi.  terminated, modified, amended or otherwise altered or
                      changed any of the terms or provisions of any Contract,
                      except in the ordinary course of business and consistent
                      with past practice, or paid any amount not required by Law
                      or by any Contract in excess of $10,000 in the aggregate.
      
       7.  Title to Properties. Except as disclosed on Schedule 3.7, the Company
           has good and marketable title to, and is the lawful owner of, all of
           the tangible and intangible assets, properties and rights used in
           connection with its business and all of the tangible and intangible
           assets, properties and rights reflected in the Financial Statements
           or Schedule 3.10 (other than assets leased under the leases set forth
           in Schedule 3.10 and assets disposed of in the ordinary course of
           business since the date of such Financial Statements).
       8.  Condition and Sufficiency of Assets.
            a. Except as disclosed on Schedule 3.8, all of the tangible assets
               and properties of the Company, whether real or personal, owned or
               leased, have been well maintained and are in good operating
               condition and repair (with the exception of normal wear and
               tear), and are free from defects other than such minor defects as
               do not materially interfere with the intended use thereof in the
               conduct of normal operations.
            b. The Company owns or has a right to use all the assets,
               properties, rights, know-how and processes that are required for
               or used in connection with, the operation of its business as it
               is presently conducted and the consummation of this transaction
               will not impair the Company's ownership, access or other rights
               in and to such assets. Such assets, properties, rights, know-how,
               processes and key personnel were sufficient to produce the income
               for the eleven (11)-month period ended November 30, 2002 as shown
               on the income statement for that period set forth in Schedule
               1.1A.
      
       9.  Real Property.
            a. Except as disclosed in Schedule 3.9, the Company owns the Real
               Property in fee simple absolute. The Real Property constitutes
               all of the real property interests held by the Company and
               required for or currently used in connection with the operation
               of its business as it is presently conducted. The activities
               carried on in all buildings, plants, facilities, installations,
               fixtures and other structures or improvements included as part
               of, or located on or at, the Real Property, and the buildings,
               plants, facilities, installations, fixtures and other structures
               or improvements themselves, are not in violation of, or in
               conflict with, any applicable zoning or health regulations or
               ordinance or any other similar Law applicable to or binding on
               the Company or any of its assets or properties. No parcel of land
               included in the Real Property relies on or regularly makes use of
               access to the nearest public road or right-of-way over land owned
               by others, except where such access is by means of one or more
               valid recorded easements not subject to divestiture, the terms of
               which have been disclosed in writing to Purchaser prior to the
               date hereof. All covenants or other restrictions (if any) to
               which any of the Real Property is subject are being in all
               respects properly performed and observed and do not provide for
               forfeiture or reversion of title if violated, and the Company has
               not received any notice of violation (or claimed violation)
               thereof. Seller has delivered to Purchaser true and complete
               copies of copies of all reports (if any) of any engineers,
               environmental consultants or other consultants in their
               possession relating to any of the Real Property.
            b. Each separate parcel included in the Real Property has adequate
               water supply, storm and sanitary sewer facilities, access to
               telephone, gas and electrical connections, fire protection,
               drainage and other public utilities, and has adequate parking
               facilities that meet all requirements imposed by Laws applicable
               to or binding on the Company or any of its assets or properties.
               None of the Real Property is subject to any Lien, easement,
               right-of-way, building or use restriction, exception, variance,
               reservation or limitation that might interfere with or impair the
               present and continued use thereof in the usual and normal conduct
               of the business and operations of the Company.
            c. Except as disclosed on Schedule 3.9, there is no pending, or to
               the best knowledge of Seller and the Company, threatened or
               proposed proceeding or governmental action to modify the zoning
               classification of, or to condemn or take by the power of eminent
               domain (or to purchase in lieu thereof), or to classify as a
               landmark, or to impose special assessments on, or otherwise to
               take or restrict in any way the right to use, develop or alter,
               all or any part of the Real Property.
      
       10. Personal Property. Schedule 3.10 sets forth an accurate and complete
           list as of the date of the Latest Balance Sheet of all of the
           tangible personal property used by the Company in its business.
           Schedule 3.10 also sets forth an accurate and complete list of all
           leases of personal property binding upon the Company or any of its
           assets or properties, and all items of personal property covered
           thereby. All of such tangible personal property is presently utilized
           by such Company in the ordinary course of business. Seller has
           delivered to Purchaser true and complete copies of all such personal
           property leases.
       11. Computer System. Except as disclosed in Schedule 3.11, all computer
           hardware and software and related materials used by the Company in
           its business (herein collectively referred to as the "Computer
           System") are in good working order and condition, ordinary wear and
           tear excepted, and the Company has not experienced any significant
           defect in design, workmanship or material of the Computer System, and
           the Computer System has the performance capabilities, characteristics
           and functions necessary to the conduct of the business and operations
           of the Company. The use of the Computer System by the Company
           (including any software modifications) (i) has not violated or
           infringed upon and will not violate or infringe upon the rights of
           any third parties and (ii) has not resulted in and will not result in
           the termination of any maintenance, service or support agreement
           relating to any part of the Computer System or any reduction in the
           services provided to the Company, warranties available to the Company
           or rights of the Company thereunder. The Company has full and
           adequate user and service documentation for the Computer System.
       12. Inventories. Schedule 3.12 contains an accurate and complete list of
           all inventories of the Company as of the date of the Latest Balance
           Sheet, which list separately identifies all component parts, work in
           process and finished goods as of such date. Except as described on
           Schedule 3.12, each item of the inventory owned by the Company is of
           merchantable quality, is not obsolete and is usable and saleable in
           the ordinary course of business, and none of such items are held on
           assignment or consignment. Except as reserved against in the Closing
           Date Balance Sheet, all inventory owned by the Company is expected to
           be used or sold in the ordinary course of business within twelve (12)
           months of the Closing Date. Such inventories are fairly reflected in
           the inventory accounts on the Latest Balance Sheet in accordance with
           GAAP, including all appropriate reserves, and are valued at the lower
           of cost or market using the first-in, first-out method.
       13. Accounts Receivable and Advances. Schedule 3.13 contains an accurate
           and complete aging schedule of all Accounts Receivable as of the date
           of the Latest Balance Sheet and all loans and advances to third
           parties ("Advances") as of the date hereof. Except as disclosed on
           Schedule 3.13, (a) each Account Receivable represents a sale made in
           the ordinary course of business and arose pursuant to an enforceable
           Contract for a bona fide sale of goods or for services performed, and
           the Company has performed all of its obligations to produce the goods
           or perform the services to which such Account Receivable relates and
           (b) no Account Receivable or Advance is subject to any claim for
           reduction, counterclaim, set-off, recoupment or other claim for
           credit, allowances or adjustments by the obligor thereof. Except as
           reserved against in the Closing Date Balance Sheet, all Accounts
           Receivable and Advances recorded on the Closing Date Balance Sheet
           are expected to be collectible in full within twelve (12) months of
           their origination.
       14. Intellectual Property. Schedule 3.14 is an accurate and complete list
           of all of the trademarks, trade names, service names, service marks,
           patents, copyrights (including any registrations of or pending
           applications for any of the foregoing) and other Intellectual
           Property owned by the Company (the "Owned Intellectual Property"),
           all Intellectual Property licensed to the Company (the "Licensed
           Intellectual Property") and all Contracts providing for the license
           of Owned Intellectual Property or Licensed Intellectual Property or
           otherwise relating to Owned Intellectual Property or Licensed
           Intellectual Property. Except as disclosed on Schedule 3.14:
            a. all of the Owned Intellectual Property is owned by the Company
               free and clear of all Liens, and is not subject to any license,
               royalty or other agreement, and the Company has not granted any
               license or agreed to pay or receive any royalty in respect of any
               Intellectual Property;
            b. none of the Owned Intellectual Property or the Licensed
               Intellectual Property has been or is the subject of any pending
               or threatened litigation or claim of infringement and, to the
               knowledge of Seller and the Company, there is no basis for making
               any such claim;
            c. the products assembled or sold by the Company and any process,
               method, part, design, material or other Intellectual Property
               they employ, and the marketing, performance and use by the
               Company of any product, service or other Intellectual Property,
               do not infringe or misappropriate any Intellectual Property or
               confidential or proprietary rights of any other Person, and
               neither the Company nor Seller has received any notice contesting
               its right to use any Intellectual Property; and
            d. the Company owns or possesses adequate rights in and to all
               Intellectual Property necessary to conduct its business as
               presently conducted.
      
       15. Contracts. Schedule 3.15 is an accurate and complete list of all the
           Contracts of the following types to which the Company is a party or
           by which it is bound, or to which any of its assets or properties is
           subject:
            a. any Contract, other than employment Contracts, which either (i)
               requires a payment by any party in excess of, or a series of
               payments which in the aggregate exceed, $20,000 or provides for
               the delivery of goods or performance of services, or any
               combination thereof, having a value in excess of $20,000, or (ii)
               has a term of, or requires the performance of any obligations by
               any party over a period in excess of, six (6) months, provided
               however, that customer orders set forth in Schedule 3.15 shall be
               as of the most recent date available;
            b. any Contract pursuant to which any third party agrees to perform
               any services for the Company that are required to be performed by
               the Company under any other Contract;
            c. any collective bargaining agreement;
            d. any Contract of any kind with any employee, officer or director
               of the Company, any of the respective Affiliates of such
               individuals or any other Affiliate of the Company, or any
               Contract or other arrangement of any kind with Seller, Schlatter
               or any of their Affiliates;
            e. any Contract with a sales representative, manufacturer's
               representative, distributor, dealer, broker, sales agency,
               advertising agency or other Person engaged in sales, distributing
               or promotional activities, or any Contract to act as one of the
               foregoing on behalf of any Person;
            f. any Contract pursuant to which the Company has made or will make
               loans or advances, or has or will have incurred debts or become a
               guarantor or surety or pledged its credit on or otherwise become
               responsible with respect to any undertaking of another (except
               for the negotiation or collection of negotiable instruments in
               transactions in the ordinary course of business);
            g. any indenture, credit agreement, loan agreement, note, mortgage,
               security agreement, loan commitment or other Contract relating to
               the borrowing of funds, an extension of credit or financing;
            h. any Contract involving a partnership, joint venture or other
               cooperative undertaking;
            i. any Contract involving any restrictions with respect to the
               geographical area of operations or scope or type of business of
               the Company;
            j. any power of attorney or agency agreement or arrangement with any
               Person pursuant to which such Person is granted the authority to
               act for or on behalf of the Company or the Company is granted the
               authority to act for or on behalf of any Person;
            k. any Contract relating to the Computer System;
            l. any Contract, whether or not fully performed, relating to any
               acquisition or disposition of any capital stock of the Company or
               any predecessor in interest of the Company, or any acquisition or
               disposition of any subsidiary, division, line of business,
               material assets or real property;
            m. any Contract not made in the ordinary course of business which is
               to be performed in whole or in part at or after the date of this
               Agreement; and
            n. any Contract not specified above that is material to the Company.
      
           Seller has delivered to Purchaser accurate and complete copies of
           each document listed on Schedules 3.14 and 3.15 and a written
           description of each oral arrangement so listed. Seller has delivered
           or made available to Purchaser accurate copies of each form used by
           the Company in the conduct of its business.
      
       16. Permits. Schedule 3.16 is an accurate and complete list of all
           Permits held by the Company. All the Permits so listed are in full
           force and effect and neither the Company nor Seller has received any
           notice that any such Permit may be revoked or canceled. Except for
           the Permits listed on Schedule 3.16, there are no Permits, whether
           federal, state, local or foreign, which are necessary for the lawful
           operation of the businesses of the Company.
       17. 
           Insurance
           .
               Schedule 3.17
               contains an accurate and complete list of all policies of fire,
               liability, medical, workers' compensation, title and other forms
               of insurance owned, held by or applicable to the Company or any
               of its assets or businesses, and Seller has heretofore delivered
               or made available to Purchaser accurate and complete copies of
               all such policies, including all occurrence-based policies
               applicable to the Company or its assets or businesses for all
               periods prior to the Closing Date. All such policies are valid,
               in full force and effect and enforceable, all premiums with
               respect thereto covering all periods up to and including the
               Closing Date have been paid, and no notice of cancellation or
               termination has been received with respect to any such policy.
               Such policies are sufficient for compliance with (i) all
               requirements of Law and (ii) all Contracts to which the Company
               is a party. Such insurance policies provide types and amounts of
               insurance customarily obtained by businesses similar to the
               businesses of the Company. Except as set forth in
               Schedule 3.17
               , the Company has not been refused any insurance with respect to
               its assets or operations, and its coverage has not been limited
               by any insurance carrier to which it has applied for any such
               insurance or with which it has carried insurance.
            a. Seller has furnished or made available to Purchaser an accurate
               and complete list of all claims which have been made by the
               Company since December 31, 1999 under any workers' compensation,
               general liability, property or other insurance policy applicable
               to the Company or any of its assets or businesses. Except as set
               forth on such list, there are no pending or threatened claims
               under any insurance policy. Such claim information includes the
               following information with respect to each accident, loss or
               other event: (a) the identity of the claimant; (b) the date of
               the occurrence; (c) the status as of the report date; and (d) the
               amounts paid or expected to be paid or recovered.
      
       18. Employee Benefit Plans and Employment Agreements.
           General
           . Except as listed on
           Schedule 3.18
           , neither the Company nor any of its ERISA Affiliates is a party to,
           participates in or has any liability or contingent liability with
           respect to:
            i.   any "employee welfare benefit plan" or "employee pension
                 benefit plan" as those terms are respectively defined in
                 sections 3(1) and 3(2) of ERISA, other than a "multiemployer
                 plan" (as defined in section 3(37) of ERISA) (referred to
                 collectively hereinafter in this Section as "Plans");
            ii.  any retirement or deferred compensation plan, incentive
                 compensation plan, stock plan, retention plan or agreement,
                 unemployment compensation plan, vacation pay, change in
                 control, severance pay, bonus or benefit arrangement, insurance
                 or hospitalization program or any other fringe benefit
                 arrangements for any current or former employee, director,
                 consultant or agent, whether pursuant to contract, arrangement,
                 custom or informal understanding, which does not constitute an
                 "employee benefit plan" (as defined in section 3(3) of ERISA)
                 (referred to collectively hereinafter in this Section as
                 "Arrangements"); or
            iii. any employment agreement (referred to collectively hereinafter
                 in this Section as "Employment Agreements").
           
           Plan Documents and Reports
           . A true and correct copy of each of the Plans, Arrangements and
           Employment Agreements listed on
           Schedule 3.18
           (collectively, the
           "Benefit Plans"
           ), and all Contracts relating thereto, or to the funding thereof,
           including all trust agreements, insurance contracts, administration
           contracts, investment management agreements, subscription and
           participation agreements and record keeping agreements, each as in
           effect on the date hereof, has been furnished or made available to
           Purchaser. In the case of any Benefit Plan that is not in written
           form, Purchaser has been supplied with an accurate description of
           such Benefit Plan as in effect on the date hereof. A true and correct
           copy of the most recent annual report, actuarial report, accountant's
           opinion of the plan's financial statements, summary plan description
           and Internal Revenue Service determination letter with respect to
           each Benefit Plan, to the extent applicable, and a current schedule
           of assets (and the fair market value thereof assuming liquidation of
           any asset which is not readily tradable) held with respect to any
           funded Benefit Plan has been supplied to Purchaser, and there have
           been no material changes in the financial condition in the respective
           Benefit Plans from that stated in the annual reports and actuarial
           reports supplied.
           Compliance With Laws; Liabilities
           . As to all Benefit Plans:
            i.    All Benefit Plans comply and have been administered in form
                  and in operation in all material respects in accordance with
                  their terms and with all applicable requirements of law
                  (including, in the case of any Benefit Plan which is an
                  employee pension benefit plan, the requirements of sections
                  401(a) and 50(a) of the Code), and no event has occurred which
                  will or could cause any such Benefit Plan to fail to comply
                  with such requirements and no notice has been issued by any
                  Governmental Authority questioning or challenging such
                  compliance;
            ii.   Each Benefit Plan which is an employee pension benefit plan is
                  the subject of a favorable determination letter issued by the
                  IRS with respect to the qualified status of such plan under
                  section 401(a) of the Code and the tax-exempt status of any
                  trust which forms a part of such plan under section 501(a) of
                  the Code; all amendments to any such plan for which the
                  remedial amendment period (within the meaning of section
                  401(b) of the Code and applicable regulations) has expired are
                  covered by a favorable IRS determination letter; and no event
                  has occurred which will or could give rise to disqualification
                  of any such plan under such sections or to a Tax under section
                  511 of the Code;
            iii.  none of the assets of any Benefit Plan is invested in employer
                  securities or employer real property;
            iv.   there have been no "prohibited transactions" (as described in
                  section 406 of ERISA or section 4975 of the Code) with respect
                  to any Benefit Plan and neither the Company has otherwise
                  engaged in any prohibited transaction;
            v.    there has been no act or omission which has given rise to or
                  may give rise to fines, penalties, taxes or related charges
                  under sections 502(c), 502(i), 502(l) or 4071 of ERISA or
                  Chapters 43, 47, 68 or 100 of the Code for which the Company
                  or any of its ERISA Affiliates may be liable;
            vi.   there are no actions, suits or claims (other than routine
                  claims for benefits) pending or threatened involving the
                  Benefit Plans or the assets thereof, and no facts exist which
                  could give rise to any such actions, suits or claims (other
                  than routine claims for benefits);
            vii.  no Benefit Plan is subject to Title IV of ERISA;
            viii. each Benefit Plan which constitutes a "group health plan" (as
                  defined in section 607(1) of ERISA or section 4980B(g)(2) of
                  the Code), including any plans of current and former
                  affiliates which must be taken into account under section
                  4980B and 414(t) of the Code or section 601 of ERISA, have
                  been operated in compliance with applicable Laws, including
                  the group health plan continuation coverage requirements of
                  section 4980B of the Code and section 601 of ERISA and the
                  portability and nondiscrimination requirements of sections
                  9801 and 9802 of the Code to the extent such requirements are
                  applicable;
            ix.   actuarially adequate accruals for all obligations under the
                  Benefit Plans are reflected in the Financial Statements;
            x.    neither the Company nor any of its ERISA Affiliates has any
                  liability or contingent liability under any Benefit Plan for
                  providing post-retirement medical or life insurance benefits,
                  other than statutory liability for providing group health plan
                  continuation coverage under Part 6 of Title I of ERISA and
                  section 4980B (or any predecessor section thereto) of the
                  Code; and
            xi.   there has been no act or omission that would impair the right
                  or ability of the Company or any of its ERISA Affiliates to
                  unilaterally amend or terminate any Benefit Plan.
           
           Multiemployer Plans
           . Neither the Company nor any of its ERISA Affiliates is a party to,
           participates in, contributes to, has contributed to or has any
           liability or contingent liability with respect to any multiemployer
           plan (as defined in section 3(37) of ERISA).
      
       19. Employment and Labor Matters. Schedule 3.19 contains an accurate and
           complete list of the names, titles or job descriptions, full-time or
           part time status, annual compensation or hourly rate schedule and all
           bonuses and similar payments made during the preceding fiscal year
           with respect to each and all directors, officers and employees of the
           Company currently employed by the Company (including any person on
           approved leave of absence, maternity or paternity leave, vacation,
           sick leave, short term or long term disability, military leave, jury
           duty, bereavement leave or lay off). The Company has and currently is
           conducting its businesses in compliance with all Laws relating to
           employment and employment practices, terms and conditions of
           employment, wages and hours and nondiscrimination in employment.
           Except as disclosed on Schedule 3.19, the relationship of the Company
           with its employees is good and there is, and since December 31, 1999
           there has been, no labor strike, dispute, slow-down, work stoppage or
           other labor difficulty pending or threatened against or involving the
           Company. Except as disclosed on Schedule 3.19, none of the employees
           of the Company is covered by any collective bargaining agreement, no
           collective bargaining agreement is currently being negotiated and no
           attempt is currently being made or since December 31, 1999 has been
           made to organize any employees of the Company to form or enter a
           labor union or similar organization.
       20. Capital Improvements. Schedule 3.20 describes all the capital
           improvements or purchases or other capital expenditures individually
           in excess of $25,000, and collectively in excess of $100,000, which
           the Company has committed to or contracted for and which have not
           been completed prior to the date hereof and the cost and expense
           reasonably estimated to complete such work and purchases.
       21. Taxes.
            a. Except as disclosed on Schedule 3.21, all Tax Returns have been
               or will be timely filed for the Company, and all other filings in
               respect of Taxes have been or will be timely made for the Company
               for all periods through and including the Closing Date as
               required by applicable Law. Each such Tax Return and filing is
               accurate and complete and the Company does not have any
               additional liability for Taxes with respect to any Tax Return or
               other filing heretofore filed or which was required by Law to be
               filed. All Taxes and estimated Taxes owed by the Company for all
               periods through and including the Closing Date have been or will
               be timely paid as required by applicable Law. The amounts
               provided as a current liability on the Financial Statements for
               all Taxes are adequate to cover all unpaid liabilities for all
               Taxes, whether or not disputed, that have accrued with respect to
               or are applicable to the period ended on and including the date
               thereof or to any periods prior thereto and for which the Company
               may be directly or contingently liable in its own right or as a
               transferee of the assets of, or a successor to, any Person.
               Except as set forth in Schedule 3.21, none of the Tax Returns or
               other filings that include the operations of the Company has ever
               been audited or investigated by any Governmental Authority, and
               no facts exist which would constitute grounds for the assessment
               of any additional Taxes by any Governmental Authority with
               respect to the taxable years covered in such Tax Returns and
               filings. Except as set forth in Schedule 3.21, no material issues
               have been raised in any examination by any Governmental Authority
               with respect to the business and operations of the Company which,
               by application of similar principles, reasonably could be
               expected to result in a proposed adjustment to the liability for
               Taxes for any other period not so examined, and no position has
               been taken on any Tax Return with respect to the business or
               operations of the Company for a taxable year for which the
               statute of limitations for the assessment of any Tax with respect
               thereto has not expired that is contrary to any publicly
               announced position of a Governmental Authority or that is
               substantially similar to any position which a Governmental
               Authority has successfully challenged in the course of an
               examination of a Tax Return of the Company or to the knowledge of
               Seller or the Company, any other taxpayer.
            b. All Taxes which the Company is required by Law to withhold or
               collect, including sales and use taxes, and amounts required to
               be withheld for Taxes of employees and other withholding taxes,
               have been duly withheld or collected and, to the extent required,
               have been paid over to the proper Governmental Authorities or are
               held in separate bank accounts for such purpose. All information
               returns required to be filed by the Company prior to the Closing
               Date have been or will be timely filed, and all statements
               required to be furnished to payees by the Company prior to the
               Closing Date have been furnished to such payees, and the
               information set forth on such information returns and statements
               is accurate and complete.
            c. The Company has not incurred any Tax liabilities other than in
               the ordinary course of business for any taxable year for which
               the applicable statute of limitations has not expired; there are
               no Tax Liens (other than Liens for current Taxes not yet due and
               payable) upon the properties or assets of the Company. The
               Company has not granted or been requested to grant any waiver of
               any statutes of limitations applicable to any claim for Taxes.
            d. The Company is not a "United States real property holding
               company" as defined by Section 897(c)(2) of the Code.
            e. Except as set forth in Schedule 3.21, the Company is not a party
               to or otherwise subject to any arrangement that would have the
               effect of or give rise to the recognition of taxable income or
               gain in a taxable period ending after the Closing Date without
               the receipt of or entitlement to a corresponding amount of cash.
            f. Except as set forth in Schedule 3.21, the Company is not subject
               to any joint venture, partnership or other arrangement or
               contract which is treated as a partnership for Federal income tax
               purposes. The Company is not a party to any tax sharing
               agreement.
            g. Except as set forth in Schedule 3.21, none of the assets of the
               Company constitute tax-exempt bond financed property or
               tax-exempt use property within the meaning of Section 168 of the
               Code, and none of the assets reflected on the Financial
               Statements is subject to a lease, safe harbor lease or other
               arrangement as a result of which the Company is not treated as
               the owner for Federal income tax purposes.
            h. Except as set forth in Schedule 3.21, the Company has not made or
               become obligated to make, and the Company will not as a result of
               any event connected with any transaction contemplated herein
               become obligated to make, any payments that could be
               nondeductible by reason of Section 280G or 162(m) of the Code.
            i. Except as set forth in Schedule 3.21, the basis of all
               depreciable or amortizable assets, and the methods used in
               determining allowable depreciation or amortization (including
               cost recovery) deductions of the Company, are correct and in
               compliance with the Code and the regulations thereunder in all
               material respects.
            j. Except as set forth in Schedule 3.21, the Company is not required
               to include in income any adjustment pursuant to Section 481(a) of
               the Code, for any period after the Closing Date, by reason of any
               voluntary or involuntary change in accounting method (nor has any
               taxing authority proposed in writing any such adjustment or
               change of accounting method).
            k. The Company has and does not have any liability for Taxes of any
               Person other than itself (i) under Treasury Regulation Section
               1.1502-6 (or any similar provision of state, local or foreign
               law), (ii) by contract or (iii) otherwise.
            l. The Company has not filed a consent pursuant to Section 341(f) of
               the Code (or any predecessor provision) or agreed to have Section
               341(f)(2) of the Code apply to any disposition of a subsection
               (f) asset (as such term is defined in Section 341(f)(4) of the
               Code) owned by the Company.
            m. The Company has not requested or received a ruling from any
               taxing authority or signed a closing or other agreement with any
               taxing authority which would affect any taxable period after the
               Closing Date.
            n. Neither the Company nor any of its Affiliates has utilized any
               net operating loss carry forwards since December 31, 2001.
      
       22. No Defaults or Violations. Except as disclosed on Schedule 3.22:
            a. the Company has not breached any provision of, or is in default
               under the terms of, any Contract to which it is a party or under
               which it has any rights or by which it is bound, no condition
               exists or event has occurred which, with or without notice or the
               passage of time or both, would constitute a breach of, or a
               default under, any such Contract by the Company, and no other
               party to any such Contract has breached any provision of, or is
               in default under the terms of, any such Contract;
            b. the Company is in compliance with all Laws applicable to or
               binding on the Company or any of their respective assets or
               properties, and no condition exists or event has occurred which,
               with or without notice or the passage of time or both, would
               constitute a violation under any such Law; and
            c. no notice from any Governmental Authority has been received by
               Seller or the Company claiming any violation of any Law
               (including any building, zoning or other ordinance) or requiring
               any work, construction or expenditure, or asserting any Tax,
               assessment or penalty.
      
       23. Environmental Matters. Except as disclosed in Schedule 3.23:
            a. the Company is in compliance with all Environmental Laws, and no
               condition exists or event has occurred which, with or without
               notice or the passage of time or both, would constitute a
               violation of or give rise to any liability, obligation or Lien
               under any Environmental Law;
            b. the Company is in possession of all Environmental Permits, if
               any, required for the conduct or operation of its business (or
               any part thereof), and is in compliance with all of the
               requirements and limitations included in such Environmental
               Permits, and to the best knowledge of the Selling Parties no
               circumstance could be expected to prevent renewal of such
               Environmental Permits, for said businesses as currently
               conducted, on substantially the same terms and conditions;
            c. neither the Company (including any predecessor thereof) nor, to
               the best knowledge of the Selling Parties, any other person, has
               used, disposed of, released or managed (whether by act or
               omission) any Hazardous Substance in a manner that could be
               expected to result in the Company incurring any liability or
               expense, including any cleanup cost;
            d. no notice from any Governmental Authority or any other Person has
               been received by Seller or the Company claiming that any aspect
               of the business, operations or facilities of the Company (whether
               current or historical) is in violation of any Environmental Law
               or Environmental Permit, or that any of them is responsible (or
               potentially responsible) for the cleanup or remediation of any
               substances at any location or that any of them is liable for
               exposure to any Hazardous Substance;
            e. neither the Company nor, to the best knowledge of the Selling
               Parties, any other person has disposed of any Hazardous
               Substances or waste into, on, or beneath the Real Property;
            f. the Company is not the subject of any pending or, to the best
               knowledge of Seller and the Company, threatened litigation or
               proceedings in any forum, judicial or administrative, involving a
               demand for damages, injunctive relief, penalties or other
               potential liability with respect to any Environmental Law or
               Hazardous Substance;
            g. the Company has timely filed all reports and notifications
               required to be filed with respect to all of its properties and
               facilities and has generated and maintained all required records
               and data under all applicable Environmental Laws; and
            h. no condition has existed or event has occurred with respect to
               (i) any property that was at any time owned, operated or leased,
               or any direct or indirect subsidiary that was at any time owned,
               by the Company, any predecessor to the Company or any Person that
               is or was an Affiliate of the Company, which property or
               subsidiary has been sold, transferred or disposed or for which
               any lease has terminated or (ii) any predecessor to the Company,
               that could (in the case of either of the foregoing clauses (i) or
               (ii)), with or without notice, passage of time or both, give rise
               to any present or future liability or obligation of the Company
               with respect to any Environmental Law or Hazardous Substance.
      
       24. Litigation.
            a. Except as disclosed in Schedule 3.24, there are no actions,
               suits, arbitrations, proceedings, governmental investigations or
               other litigation pending or, to the best knowledge of Seller and
               the Company, threatened against or affecting the Company or any
               of its officers, directors, employees, agents or stockholders in
               their capacity as such, or any of its properties or businesses,
               and neither the Company nor Seller is aware of any facts or
               circumstances which may give rise to any of the foregoing. Except
               as set forth on Schedule 3.24, all of the proceedings, pending or
               threatened, against the Company are fully covered by insurance
               policies (or other indemnification agreements with third parties)
               and are being defended by the insurers (or such third parties),
               subject to such deductibles as are set forth in such Schedule.
               Except as disclosed in Schedule 3.24, the Company is not subject
               to any order, judgment, decree, injunction, stipulation or
               consent order of or with any court or other Governmental
               Authority. The Company has not entered into any agreement to
               settle or compromise any proceeding pending or threatened against
               it which has involved any obligation other than the payment of
               money or for which the Company has any continuing obligation.
            b. There are no claims, actions, suits, proceedings, investigations
               or other litigation pending or, to the best knowledge of Seller
               and the Company, threatened by or against Seller, the Company, or
               any of their respective Affiliates with respect to this Agreement
               or the Related Agreements, or in connection with the transactions
               contemplated hereby or thereby, and neither Seller nor the
               Company has any reason to believe that there is a valid basis for
               any such claim, action, suit, proceeding or investigation.
      
       25. No Conflict of Interest. Except as disclosed on Schedule 3.25,
           neither Seller nor any of its Affiliates has or claims to have any
           direct or indirect interest in any tangible or intangible property
           used in the business of the Company, except for Seller as a holder of
           Shares. Except as disclosed on Schedule 3.25, neither Seller nor any
           of its Affiliates has any direct or indirect interest in any other
           Person which conducts a business similar to, has any Contract or
           arrangement with, or does business or is involved in any way with,
           the Company, except for the ownership of less than one percent (1%)
           of the outstanding stock of any publicly held corporation. Schedule
           3.25 contains an accurate and complete description of all such
           Persons, interests, arrangements and other matters.
       26. Bank Accounts. Schedule 3.26 sets forth an accurate and complete list
           of the names and locations of each bank or other financial
           institution at which the Company has an account (giving the account
           numbers) or safe deposit box and the names of all Persons authorized
           to draw thereon or have access thereto, and the names of all Persons,
           if any, now holding powers of attorney or comparable delegation of
           authority from the Company and a summary statement thereof.
       27. Customers and Suppliers.
               Schedule 3.27
               sets forth:
                i.   an accurate and complete list of the twenty (20) largest
                     customers of the Company taken as a whole, in terms of tons
                     sold, during each of the 2000 and 2001 fiscal years and the
                     period from January 1, 2002 to the date of this Agreement
                     (collectively, the "Major Customers"), showing the total
                     revenue received in each such period from each such
                     customer;
                ii.  an accurate and complete list of the ten (10) largest (and
                     certain additional) suppliers of the Company, in terms of
                     purchases during each of the 2000 and 2001 fiscal years and
                     the period from January 1, 2002 to the date of this
                     Agreement (collectively, the "Major Suppliers"), showing
                     the total purchases made in each such period from each such
                     supplier; and
                iii. an accurate and complete list of all customer complaints
                     received by Seller or the Company during the 2001 fiscal
                     year and the period from January 1, 2002 to the date of
                     this Agreement or received during an earlier period that
                     remain unresolved.
           
            a. Except as set forth in Schedule 3.27, since December 31, 1999,
               there has been no adverse change in the business relationship,
               and there has been no material dispute, between the Company and
               any Major Customer or any Major Supplier, and there are no
               indications that there will be any such adverse change or dispute
               or that any Major Customer or Major Supplier intends to reduce
               its purchases from, or sales to the Company.
      
       28. Improper and Other Payments. Except as set forth on Schedule 3.28,
           (a) neither the Company, any director, officer, employee, agent or
           representative of the Company nor any Person acting on behalf of any
           of them, has made, paid or received any bribes, kickbacks or other
           similar payments to or from any Person, whether lawful or unlawful,
           (b) no contributions have been made by the Company, directly or
           indirectly, to a domestic or foreign political party or candidate,
           (c) no improper foreign payment (as defined in the Foreign Corrupt
           Practices Act) has been made and (d) the internal accounting controls
           of the Company are reasonably designed to detect any of the
           foregoing.
       29. Brokers. Neither the Company, Seller nor Schlatter has used any
           broker or finder in connection with the transactions contemplated
           hereby, and neither Purchaser nor any Affiliate of Purchaser has or
           shall have any liability or otherwise suffer or incur any Loss as a
           result of or in connection with any brokerage or finder's fee or
           other commission of any Person retained by the Company, Seller or any
           of their respective Affiliates in connection with any of the
           transactions contemplated by this Agreement or the Related
           Agreements.
       30. Accuracy of Statements. Neither this Agreement nor any schedule or
           certificate furnished or to be furnished by or on behalf of Seller or
           the Company to Purchaser or any representative or Affiliate of
           Purchaser in connection with this Agreement, any Related Agreement or
           any of the transactions contemplated hereby or thereby contains or
           will contain any untrue statement of a material fact or omits or will
           omit to state a material fact necessary to make the statements
           contained herein or therein, in light of the circumstances in which
           they are made, not misleading.

      
      REPRESENTATIONS AND WARRANTIES OF PURCHASER

      Purchaser represents and warrants to each Seller, as of the date of this
      Agreement and as of the Closing Date (as if such representations and
      warranties were remade on the Closing Date), as follows:

       1. Due Incorporation. Purchaser is a corporation duly organized, validly
          existing and in good standing under the laws of the State of Delaware,
          with all requisite corporate power and authority to own, lease and
          operate its properties and to carry on its business as they are now
          being owned, leased, operated and conducted.
       2. Due Authorization. Purchaser has full corporate power and authority to
          enter into this Agreement and its Related Agreements and to consummate
          the transactions contemplated hereby and thereby. The execution,
          delivery and performance by Purchaser of this Agreement and its
          Related Agreements, and the consummation by Purchaser of the
          transactions contemplated hereby and thereby, have been duly and
          validly approved by the board of directors of Purchaser, and no other
          actions or proceedings on the part of Purchaser are necessary to
          authorize this Agreement, its Related Agreements and the transactions
          contemplated hereby and thereby. Purchaser has duly and validly
          executed and delivered this Agreement and has duly and validly
          executed and delivered (or prior to or at the Closing will duly and
          validly execute and deliver) its Related Agreements. This Agreement
          constitutes legal, valid and binding obligations of Purchaser and
          Purchaser's Related Agreements upon execution and delivery by
          Purchaser will constitute legal, valid and binding obligations of
          Purchaser, in each case, enforceable in accordance with their
          respective terms, except as such enforceability may be limited by
          applicable bankruptcy, insolvency, moratorium, reorganization or
          similar laws in effect that affect the enforcement of creditors'
          rights generally and by equitable limitations on the availability of
          specific remedies.
       3. Consents and Approvals; Authority Relative to this Agreement.
           a. Except as set forth on Schedule 4.3, no consent, authorization or
              approval of, filing or registration with, or cooperation from, any
              Governmental Authority or any other Person not a party to this
              Agreement is necessary in connection with the execution, delivery
              and performance by Purchaser of this Agreement and its Related
              Agreements and the consummation by Purchaser of the transactions
              contemplated hereby and thereby.
           b. Except as set forth on Schedule 4.3, the execution, delivery and
              performance by Purchaser of this Agreement and its Related
              Agreements, and the consummation by Purchaser of the transactions
              contemplated hereby and thereby, do not and will not (i) violate
              any Law applicable to or binding on Purchaser or any of its assets
              or properties; (ii) violate or conflict with, result in a breach
              or termination of, constitute a default or give any third party
              any additional right (including a termination right) under, permit
              cancellation of, result in the creation of any Lien upon any of
              the assets or properties of Purchaser under, or result in or
              constitute a circumstance which, with or without notice or lapse
              of time or both, would constitute any of the foregoing under, any
              Contract to which Purchaser is a party or by which Purchaser or
              any of its assets or properties are bound; (iii) permit the
              acceleration of the maturity of any indebtedness of Purchaser or
              indebtedness secured by its assets or properties; or (iv) violate
              or conflict with any provision of Purchaser's Certificate of
              Incorporation or by-laws.
      
       4. Litigation. There are no claims, actions, suits, proceedings,
          investigations or other litigation pending or, to the best knowledge
          of Purchaser, threatened by or against Purchaser or any of its
          Affiliates with respect to this Agreement or the Related Agreements,
          or in connection with the transactions contemplated hereby or thereby,
          and Purchaser has no reason to believe that there is a valid basis for
          any such claim, action, suit, proceeding or investigation.
       5. Brokers. Purchaser has used no broker or finder in connection with the
          transactions contemplated hereby, and none of the Company, Seller or
          any of its Affiliates has or shall have any liability or otherwise
          suffer or incur any Loss as a result of or in connection with any
          brokerage or finder's fee or other commission of any Person retained
          by Purchaser or any of its Affiliates in connection with any of the
          transactions contemplated by this Agreement or the Related Agreements.

      
      COVENANTS

       1.  Implementing Agreement. Subject to the terms and conditions hereof,
           each party hereto shall take all action required of it to fulfill its
           obligations under the terms of this Agreement and shall otherwise use
           all commercially reasonable efforts to facilitate the consummation of
           the transactions contemplated hereby.
       2.  
           Access to Information and Facilities
           .
            a. From and after the date of this Agreement until the Closing Date,
               Seller and the Company shall (i) upon reasonable notice to
               Seller, give Purchaser and Purchaser's representatives reasonable
               access to all of the facilities, properties, books, records and
               Contracts of the Company, (ii) upon reasonable notice to Seller,
               make the officers and employees of the Company available to
               Purchaser and its representatives as Purchaser and its
               representatives shall from time to time reasonably request and
               (ii) furnish Purchaser and its representatives with any and all
               information concerning the Company which Purchaser or its
               representatives reasonably request. From and after the date of
               this Agreement until the Closing Date, without limiting the
               foregoing, Seller and the Company shall give Purchaser and its
               representatives reasonable access during normal business hours
               and upon reasonable notice to Seller to the Real Property to
               perform such environmental and other tests, at Purchaser's sole
               expense, as Purchaser or its representatives may reasonably
               determine, including installing wells for testing the location,
               nature or degree of any groundwater contamination.
            b. From and after the Closing Date until the expiration or
               termination of the Non-Competition Period, the Company shall upon
               reasonable notice, give Schlatter and its Affiliates reasonable
               access to the Company's manufacturing facilities for the purpose
               of demonstrating the operation of the equipment located at the
               Company's manufacturing facilities to their customers and
               potential customers; provided that nothing herein will obligate
               the Company to take any actions that would unreasonably interrupt
               the normal course of its business or to violate any Law or the
               terms of any Contract to which the Company is party or to which
               any of its assets are subject. The Company may require that a
               Person enter into a confidentiality agreement, on reasonable
               terms and conditions, prior to providing such Person access to
               the Company's manufacturing facilities.
            c. Purchaser and Seller acknowledges that they are bound by that
               certain Non-Disclosure Agreement dated January 16, 2002 between
               Purchaser, Seller and Schlatter.
      
       3.  Preservation of Business. From the date of this Agreement until the
           Closing Date, Seller shall cause the Company to operate only in the
           ordinary and usual course of business and consistent with past
           practice, and shall use all commercially reasonably efforts to: (a)
           preserve intact the present business organization and personnel of
           the Company, (b) preserve the good will and advantageous
           relationships of the Company with customers, suppliers, employees,
           independent contractors and other Persons material to the operation
           of its businesses and (c) not permit any action or omission which
           would cause any of the representations or warranties of Seller
           contained herein to become inaccurate or any of the covenants of
           Seller or the Company to be breached. Without limiting the generality
           of the foregoing, except as set forth in Schedule 5.3, prior to the
           Closing the Company will not, without the prior written consent of
           Purchaser:
            i.    incur any obligation or enter into any Contract that would be
                  required to be disclosed on Schedule 3.15, except in the
                  ordinary course of business and consistent with past practice;
            ii.   take any action, or enter into or authorize any Contract or
                  transaction, other than in the ordinary course of business and
                  consistent with past practice;
            iii.  sell, convey, assign or otherwise transfer of any of its
                  assets or properties, except sales of inventory in the
                  ordinary course of business and consistent with past practice;
            iv.   waive, release or cancel any material claims against third
                  parties or debts owing to it, or any rights which have any
                  value with an aggregate value, in the case of debts or rights
                  with value, in the aggregate in excess of $10,000;
            v.    make any changes in its accounting systems, policies,
                  principles, practices or methods;
            vi.   except as expressly permitted by Section 5.12, enter into,
                  authorize or permit any transaction with Seller or any of its
                  Affiliates;
            vii.  authorize for issuance, issue, sell, deliver or agree or
                  commit to issue, sell or deliver (whether through the issuance
                  or granting of options, warrants, convertible or exchangeable
                  securities, commitments, subscriptions, rights to purchase or
                  otherwise) any shares of capital stock or any other securities
                  of the Company, or amend any of the terms of any such capital
                  stock or other securities;
            viii. split, combine or reclassify any shares of its capital stock,
                  declare, set aside or pay any dividend or other distribution
                  (whether in cash, stock or property or any combination
                  thereof) in respect of its capital stock, or redeem or
                  otherwise acquire any capital stock or other securities of the
                  Company;
            ix.   make any borrowings, incur any debt (other than trade
                  payables, draws under the Company's existing line of credit
                  and other business expenses not in excess of $10,000 in the
                  aggregate, all of which have been made or incurred in the
                  ordinary course of business and consistent with past
                  practice), or assume, guarantee, endorse (except for the
                  negotiation or collection of negotiable instruments in the
                  ordinary course of business and consistent with past practice)
                  or otherwise become liable (whether directly, contingently or
                  otherwise) for the obligations of any other Person, or make
                  any payment or repayment in respect of any indebtedness to any
                  Affiliates of the Company or other than in the ordinary course
                  of business, consistent with past practice);
            x.    make any loans, advances or capital contributions to, or
                  investments in, any other Person;
            xi.   enter into, adopt, amend or terminate any bonus, profit
                  sharing, compensation, termination, stock option, stock
                  appreciation right, restricted stock, performance unit,
                  pension, retirement, deferred compensation, employment,
                  severance or other employee benefit agreement, trust, plan,
                  fund or other arrangement for the benefit or welfare of any
                  director, officer or employee, or increase in any manner the
                  compensation or fringe benefits of any director, officer or
                  employee or pay any benefit not required by any existing plan
                  and arrangement or enter into any contract, agreement,
                  commitment or arrangement to do any of the foregoing;
            xii.  except for capital expenditures contemplated by (xiii) below,
                  acquire, lease or encumber any assets outside the ordinary
                  course of business or any assets which are material to the
                  Company;
            xiii. authorize or make any capital expenditures which individually
                  or in the aggregate are in excess of $25,000;
            xiv.  make any Tax election or settle or compromise any federal,
                  state, local or foreign income Tax liability, or waive or
                  extend the statute of limitations in respect of any such
                  Taxes;
            xv.   pay any amount, perform any obligation or agree to pay any
                  amount or perform any obligation, in settlement or compromise
                  of any suit or claim of liability against the Company or any
                  of its directors, officers, employees or agents; or
            xvi.  terminate, modify, amend or otherwise alter or change any of
                  the terms or provisions of any Contract except in the ordinary
                  course of business and consistent with past practice, or pay
                  any amount not required by Law or by any Contract in excess of
                  $10,000 in the aggregate.
      
       4.  Consents and Approvals. From the date of this Agreement until the
           Closing Date, Seller shall use all commercially reasonable efforts to
           obtain all consents, approvals, certificates and other documents
           required in connection with the performance of this Agreement and the
           Related Agreements and the consummation of the transactions
           contemplated hereby and thereby, including all consents and approvals
           required by any of the Contracts referred to in Schedule 3.3;
           provided, that no contact will be made by Seller or the Company (or
           any representative thereof) with any third party to obtain any such
           consent or approval except in accordance with a plan previously
           agreed to by Purchaser. From the date of this Agreement until the
           Closing Date, Purchaser shall use all commercially reasonable efforts
           to obtain all consents, approvals, certificates and other documents
           required in connection with its performance of this Agreement and the
           Related Agreements and the consummation of the transactions
           contemplated hereby and thereby. Seller and the Company shall
           promptly make all filings, applications, statements and reports to
           all Governmental Authorities and other Persons that are required to
           be made prior to the Closing Date by or on behalf of Seller, the
           Company or any of their respective Affiliates pursuant to any
           applicable Law or Contract in connection with this Agreement, the
           Related Agreements and the transactions contemplated hereby and
           thereby. Purchaser shall promptly make all filings, applications,
           statements and reports to all Governmental Authorities and other
           Persons that are required to be made prior to the Closing Date by or
           on behalf of Purchaser or any of its Affiliates pursuant to any
           applicable Law or Contract in connection with this Agreement, the
           Related Agreements and the transactions contemplated hereby and
           thereby.
       5.  Maintenance of Insurance. From the date of this Agreement until the
           Closing Date, Seller shall cause the Company to, and the Company
           shall continue to carry its existing insurance through the Closing
           Date, and shall not, and shall cause its Affiliates not to, breach,
           default, termination or cancellation of such insurance policies or
           agreements to occur or exist that are not replaced with equivalent
           coverage.
       6.  Resignation of Officers and Directors. Prior to the Closing Date,
           Seller shall cause each officer and member of the Board of Directors
           of, and each non-corporate trustee or fiduciary of any plan or
           arrangement involving employee benefits of, the Company to tender his
           or her resignation from such position effective as of the Closing.
       7.  Supplemental Information. Prior to the Closing Date, Seller shall
           promptly disclose in writing to Purchaser any matter hereafter
           arising which constitutes, or could result in, a breach of any
           representation or warranty or covenant or agreement of Seller in this
           Agreement and/or any of the Related Agreements, or which has, or
           could have the effect of making any such representation or warranty
           of Seller untrue or incorrect in any respect. Such disclosure shall
           not be deemed to cure any breach of any representation or warranty
           for purposes of Section 6.1.
       8.  Confidentiality. After the Closing, Seller shall, and shall cause
           each of its Affiliates to, maintain all non-public or confidential
           information relating to the Company and its operations in strict
           confidence and not disclose to any Person or use any such information
           for any purpose; provided, that such restrictions shall not apply to
           (a) any information which becomes publicly available after the
           Closing Date through no fault of Seller or any of its Affiliates, (b)
           any information which after the Closing is legitimately received by
           Seller or any of its Affiliates from a third party (provided such
           third party is not known by Seller or any of its Affiliates to be
           bound by an obligation of secrecy) and (c) any disclosure required by
           Law or any Governmental Authority, so long as notice of such
           disclosure is given to Purchaser prior to making such disclosure and
           Seller cooperates with Purchaser as Purchaser may reasonably request
           to resist such disclosure.
       9.  Exclusivity. Prior to the Closing Date, none of Seller, the Company,
           or any of their respective directors, officers, employees,
           representatives, agents or Affiliates shall, directly or indirectly,
           solicit, initiate, encourage, respond favorably to, condone inquiries
           or proposals from, or provide any non-public confidential information
           to, or participate in any discussions or negotiations with, any
           Person (other than Purchaser and its directors, officers, employees,
           representatives and agents) concerning (a) any merger, sale of assets
           not in the ordinary course of business, acquisition, business
           combination, change of control or other similar transaction involving
           the Company or any division of the Company, (b) any purchase or other
           acquisition by any Person of Shares or (c) any sale or issuance by
           the Company of any shares of its capital stock. Seller shall promptly
           advise Purchaser of, and communicate to Purchaser the terms and
           conditions of (and the identity of the Person making), any such
           inquiry or proposal received.
       10. Use of Name. From and after the Closing Date, neither Seller nor its
           Affiliates shall directly or indirectly use in any manner any trade
           name, trademark, service mark or logo used by the Company or any word
           or logo that is similar in sound or appearance to such names, marks
           or logos.
       11. Interim Financial Statements. Prior to the Closing Date, Seller shall
           provide to Purchaser, as soon as practicable after the end of each
           calendar month, unaudited financial statements of the Company,
           consisting of a balance sheet as of the end of such month and an
           income statement for that month and for the portion of the year then
           ended (such financial statements, "Interim Financial Statements").
       12. Termination of Certain Agreements. Seller and the Company shall, and
           agree that they shall cause their respective Affiliates to, effective
           as of the Closing, without any cost to, payment by or liability of
           the Company, terminate, rescind, cancel and render void and of no
           effect any and all Contracts, if any, between the Company on the one
           hand and Seller or any of its Affiliates (other than the Company) on
           the other hand; provided, that this Section 5.12 shall not apply to
           this Agreement or any Related Agreement, any Contract set forth on
           Schedule 5.12 or any Retained Indebtedness.
       13. Tax Matters/Financial Information.
            a. After the Closing, Seller shall make available to Purchaser, at
               Purchaser's expense, such records as Purchaser may require for
               the preparation of any Tax Returns, financial statements, or
               other similar reports or forms required to be filed by Purchaser
               for periods after the Closing and such records as Purchaser may
               require for the defense of any audit, examination, administrative
               appeal or litigation of any such Tax Return or other similar
               report or form, in each case in connection with the Company.
               After the Closing, Purchaser shall make available to Seller, at
               Seller's expense, such records as Seller may require for the
               preparation of any Tax Returns, financial statements, or other
               similar reports or forms required to be filed by Seller for
               periods prior to the Closing and such records as Seller may
               require for the defense of any audit, examination, administrative
               appeal or litigation or any such Tax Return or other similar
               report or form, in each case in connection with the Company.
               Seller and the Purchaser shall cooperate with one another in any
               such audit, examination, appeal or litigation. The parties
               acknowledge that the Company has scheduled audit work for January
               and February, 2003, together with preparation work for such
               audit. The costs of the audit will be paid by Seller. Purchaser
               will provide Seller copies of the audit for the fiscal year 2002
               and will cooperate with Seller in providing access to the
               Company's independent accountants and any additional financial
               information or records relating to the pre-Closing period
               reasonably requested by Seller at Seller's cost and expense.
               Purchaser will use all commercially reasonable efforts to have
               audited financial statements for the fiscal year 2002 completed
               by the date such audit is currently scheduled to be completed.
            b. In each case of a jurisdiction or Tax with respect to which the
               Company's taxable year does not end on the Closing Date, for
               purposes of allocating liability for Taxes there shall be deemed
               a short taxable year ending on and including the Closing Date and
               a second deemed short taxable year beginning on and including the
               day after such date. Any Taxes for a taxable period beginning
               during the Pre-Closing Tax Period and ending after the Closing
               Date shall be apportioned between the Pre-Closing tax Period and
               the subsequent period based, in the case of property taxes, on a
               per diem basis, and, in the case of other Taxes, on an interim
               closing of the books as of the close of the Pre-Closing Tax
               Period.
      
       14. NOLs. Neither the Company nor any of its Affiliates will utilize any
           net operating loss carry forwards available to the Company as of the
           date hereof for the period prior to the Closing Date other than to
           offset any taxable income from operations generated prior to the
           Closing. Seller and Purchaser will mutually agree upon a plan for the
           repayment and/or forgiveness of debt owed by the Company to Seller
           and its Affiliates. The Company will not repay or forgive any such
           debt with out the consent of the Purchaser other than in accordance
           with the plan.

      
      CONDITIONS PRECEDENT TO OBLIGATIONS OF PURCHASER

      The obligations of Purchaser under Article II are subject to the
      satisfaction or waiver by Purchaser of the following conditions precedent
      on or before the Closing Date:

       1. Warranties True as of Both Present Date and Closing Date. The
          representations and warranties of Seller contained herein and in its
          Related Agreements shall have been accurate, true and correct on and
          as of the date hereof and of the Related Agreements, respectively,
          and, except to the extent that any such representation or warranty is
          made solely as of the date hereof or as of another date earlier than
          the Closing Date, and except for any changes disclosed pursuant to
          Section 5.7 that result from activities or transactions which may have
          taken place after the date hereof and before the Closing and which are
          expressly permitted or contemplated to take place after the date
          hereof and before the Closing by this Agreement or the Related
          Agreements, shall also be accurate, true and correct on and as of the
          Closing Date in all material respects with the same force and effect
          as though made by Seller on and as of the Closing Date.
       2. Compliance with Agreements and Covenants. Seller and the Company shall
          have performed and complied with all of their respective covenants and
          obligations contained in this Agreement and in their Related
          Agreements to be performed and complied with by them on or prior to
          the Closing Date.
       3. Certificate of Compliance. Seller shall have delivered to Purchaser a
          certificate dated as of the Closing Date, signed by the President or
          Vice President of Seller, certifying as to compliance with Section 6.1
          and Section 6.2.
       4. Consents and Approvals. Purchaser shall have received written evidence
          satisfactory to Purchaser that all consents and approvals set forth on
          Schedule 3.3 and marked with an asterisk have been obtained.
       5. No Material Adverse Change. No Material Adverse Change shall have
          occurred and no event shall have occurred which, in the reasonable
          judgment of Purchaser, may have a Material Adverse Effect.
       6. Actions or Proceedings. No action or proceeding by any Governmental
          Authority or other Person shall have been instituted or threatened
          which (a) causes or might cause a Material Adverse Effect or (b)
          enjoins, restrains, prohibits or results in substantial damages in
          respect of, or could enjoin, restrain, prohibit or result in
          substantial damages in respect of, any provision of this Agreement or
          any Related Agreement or the consummation of the transactions
          contemplated hereby or thereby or any integration of any operations of
          the Company with those of Purchaser and its Affiliates.

      

      
      CONDITIONS PRECEDENT TO OBLIGATIONS OF SELLER

      The obligations of Seller under Article II are subject to the satisfaction
      or waiver by Seller of the following conditions precedent on or before the
      Closing Date:

       1. Warranties True as of Both Present Date and Closing Date. The
          representations and warranties of Purchaser contained herein and in
          its Related Agreements shall have been accurate, true and correct on
          and as of the date hereof and of the Related Agreements, respectively,
          and shall also be accurate, true and correct on and as of the Closing
          Date in all material respects with the same force and effect as though
          made by Purchaser on and as of the Closing Date.
       2. Compliance with Agreements and Covenants. Purchaser shall have
          performed and complied with all of its covenants and obligations
          contained in this Agreement and in its Related Agreements to be
          performed and complied with by it on or prior to the Closing Date.
       3. Certificate of Compliance. Purchaser shall have delivered to Seller a
          certificate of Purchaser dated as of the Closing Date, signed by the
          President or a Vice President of Purchaser, certifying as to
          compliance with Section 7.1 and Section 7.2.
       4. Consents and Approvals. Seller and the Company shall have received all
          consents and approvals set forth on Schedule 3.3 and marked with a
          cross.
       5. Actions or Proceedings. No action or proceeding by any Governmental
          Authority or other Person shall have been instituted or threatened
          which enjoins, restrains, prohibits or results in substantial damages
          in respect of, or could enjoin, restrain, prohibit or result in
          substantial damages in respect of, any provision of this Agreement or
          any Related Agreement or the consummation of the transactions
          contemplated hereby or thereby.

      
      CLOSING

       1. Closing. Subject to Articles VI and VII, the Closing shall take place
          at the offices of Mayer, Brown, Rowe & Maw, at 1909 K. Street, N.W.,
          Washington, D.C. 20006, at 8:00 A.M. on the later of: (i) December 30,
          2002 or (ii) three (3) Business Days after the satisfaction or waiver
          of the conditions precedent set forth in Sections 6.4, 6.5, 7.4 and
          7.5, or at such other date or location as Seller and Purchaser shall
          agree upon in writing. The Closing, and all transactions to occur at
          the Closing, shall be deemed to have taken place at, and shall be
          effective as of, the close of business on the Closing Date.
       2. Deliveries by Seller. At the Closing, in addition to any other
          documents or agreements required under this Agreement, Seller shall
          deliver to Purchaser the following:
           a. certificates evidencing all of the Shares, which certificates
              shall be duly endorsed in blank or accompanied by duly executed
              stock powers;
           b. the resignations of all officers and directors of, and each
              non-corporate trustee or fiduciary of any plan or arrangement
              involving employee benefits of, the Company;
           c. evidence, in form satisfactory to Purchaser, that all consents and
              approvals set forth on Schedule 3.3 and marked with an asterisk
              have been obtained;
           d. a written statement from each Person holding a Lien (other than a
              Permitted Lien) upon any of the assets of the Company, or upon any
              Shares, confirming the repayment of the indebtedness secured
              thereby and the release as of the Closing Date of (i) such Lien
              and (ii) all obligations under any and all Contracts relating
              thereto;
           e. a certificate of the Secretary of the Company certifying
              resolutions of the Board of Directors of the Company approving and
              authorizing the execution, delivery and performance of this
              Agreement and its Related Agreements and the consummation of the
              transactions contemplated hereby and thereby (together with an
              incumbency and signature certificate regarding the officer(s)
              signing on behalf of the Company);
           f. a certificate of the Secretary of each of Seller and Schlatter, as
              applicable, certifying resolutions of the Board of Directors of
              Seller and Schlatter, as applicable, approving and authorizing the
              execution, delivery and performance of this Agreement and its
              Related Agreements and the consummation of the transactions
              contemplated hereby and thereby (together with an incumbency and
              signature certificate regarding the officer(s) signing on behalf
              of Seller and Schlatter, as applicable);
           g. the Certificate of Incorporation of the Company, certified by the
              Secretary of State or equivalent Person of its jurisdiction of
              incorporation, and the by-laws or similar instrument of the
              Company, certified by its Secretary;
           h. Certificates of Good Standing for the Company from the following
              states: Pennsylvania and Delaware;
           i. an opinion, dated the Closing Date, of Moore & Bruce, LLP, counsel
              to the Company and Seller, in form and substance satisfactory to
              Purchaser and to the effect set forth in Exhibit A;
           j. a certification from the Company, dated no more than thirty (30)
              days prior to the effective time and signed by a responsible
              corporate officer of the Company, that the Company is not and has
              not been at any time during the five (5) years preceding such
              certification, a United States real property holding corporation,
              as defined in Section 897(c)(2) of the Code;
           k. such other documents and instruments as may be required by any
              other provision of this Agreement or any Related Agreement or as
              may reasonably be required to consummate the transactions
              contemplated by this Agreement and the Related Agreements.
      
       3. Deliveries by Purchaser. At the Closing, Purchaser shall deliver to
          Seller the following:
           a. the amounts payable to Seller at the Closing pursuant to Section
              2.2;
           b. a certificate of Purchaser's secretary certifying resolutions of
              the Board of Directors of Purchaser approving this Agreement and
              its Related Agreements and the transactions contemplated hereby
              and thereby (together with an incumbency and signature certificate
              regarding the officer(s) signing on behalf of Purchaser);
           c. an opinion, dated the Closing Date, of Mayer, Brown, Rowe & Maw,
              counsel for Purchaser, in form and substance satisfactory to
              Seller; and
           d. such other documents and instruments as may be required by any
              other provision of this Agreement or any Related Agreement or as
              may reasonably be required to consummate the transactions
              contemplated by this Agreement and the Related Agreements.

      
      TERMINATION

       1. Termination. This Agreement may be terminated at any time on or prior
          to the Closing Date:
           a. with the mutual consent of Seller and Purchaser;
           b. by Seller or Purchaser, if the Closing shall not have taken place
              on or before January 31, 2003; provided, that the right to
              terminate this Agreement under this Section 9.1(b) shall not be
              available to (i) Seller if the failure of Seller or the Company to
              fulfill any obligation under this Agreement has been the cause of
              or resulted in the failure of the Closing to occur on or before
              such date or (ii) Purchaser if the failure of Purchaser to fulfill
              any obligation under this Agreement has been the cause of or
              resulted in the failure of the Closing to occur on or before such
              date;
           c. by Purchaser, if there shall have been a material breach of any
              covenant, obligation, representation or warranty of Seller or the
              Company hereunder, and such breach shall not have been remedied
              within ten (10) Business Days after receipt by Seller of a notice
              in writing from Purchaser specifying the breach and requesting
              such breach be remedied; or
           d. by Seller, if there shall have been a material breach of any
              covenant, obligation, representation or warranty of Purchaser
              hereunder, and such breach shall not have been remedied within ten
              (10) Business Days after receipt by Purchaser of notice in writing
              from Seller specifying the breach and requesting such breach be
              remedied.
      
       2. Effect of Termination. If this Agreement is terminated pursuant to
          Section 9.1, all obligations of the parties hereunder shall terminate,
          except for the obligations set forth in Sections 3.29 (brokers), 4.5
          (brokers), 12.1 (expenses) and 12.10 (publicity), which shall survive
          the termination of this Agreement, and except that no such termination
          shall relieve any party from liability for any prior intentional
          breach of this Agreement.

      

      
      INDEMNIFICATION
      
       1. 

      Survival
      . The representations and warranties of the parties hereto contained
      herein shall survive the Closing for a period of two (2) years, except
      that Tax Warranties shall survive until the Tax Statute of Limitations
      Date, Environmental Warranties shall survive for a period of five (5)
      years and Title and Authorization Warranties shall survive forever.
 I.   Indemnification by Seller. Each of Seller and Schlatter jointly and
      severally agrees to indemnify each of the Purchaser Indemnified Parties
      against, and agrees to hold each of them harmless from, any and all Losses
      incurred or suffered by them relating to or arising out of or in
      connection with any of the following:
       a. any breach of or any inaccuracy in (or any alleged breach of or
          inaccuracy in) any representation or warranty made by Seller in this
          Agreement or any Related Agreement or any document delivered by Seller
          at the Closing; provided, that (i) in the case of all representations
          and warranties, except for Title and Authorization Warranties,
          Environmental Warranties and Tax Warranties, a notice of the Purchaser
          Indemnified Party's claim shall have been given to Seller not later
          than the close of business on the second anniversary of the Closing
          Date, (ii) in the case of Environmental Warranties, a notice of the
          Purchaser Indemnified Parties claim shall have been given to Seller
          not later than the close of business on the fifth anniversary of the
          Closing Date and (iii) in the case of Tax Warranties, a notice of the
          Purchaser Indemnified Party's claim shall have been given to Seller
          not later than the close of business on the Tax Statute of Limitations
          Date; or
       b. any breach of or failure by Seller, Schlatter or the Company to
          perform any covenant or obligation of Seller or the Company set out or
          contemplated in this Agreement or any Related Agreement or any
          document delivered by Seller, Schlatter or the Company at the Closing;
       c. any matter set forth on Schedule 3.13 or 3.24;
       d. any liability, include warranty claims, related to goods sold or
          services provided by the Company prior to the Closing.
       e. any liability for Taxes of the Company attributable to the Pre-Closing
          Tax Period in excess of the amount specifically reserved on the
          Closing Date Balance Sheet.

 II.  Indemnification by Purchaser. Purchaser agrees to indemnify each of the
      Seller Indemnified Parties against, and agrees to hold each of them
      harmless from, any and all Losses incurred or suffered by them relating to
      or arising out of or in connection with any of the following:
       a. any breach of or any inaccuracy in (or any alleged breach of or
          inaccuracy in) any representation or warranty made by Purchaser in
          this Agreement or any Related Agreement or any document delivered by
          Purchaser at the Closing; provided, that in the case of all
          representations and warranties, except for Title and Authorization
          Warranties, a notice of the Seller Indemnified Party's claim shall
          have been given to Purchaser not later than the close of business on
          the second anniversary of the Closing Date; or
       b. any breach of or failure by Purchaser to perform any covenant or
          obligation of Purchaser set out or contemplated in this Agreement or
          any Related Agreement or any document delivered by Purchaser at the
          Closing.

 III. Claims. As soon as is reasonably practicable after becoming aware of a
      claim for indemnification under this Agreement, or the commencement of any
      suit, action or proceeding, of the type described in Section 10.5, the
      Indemnified Person shall give notice to the Indemnifying Person of such
      claim and the amount (to the extent then determinable) that the
      Indemnified Person will be entitled to receive hereunder from the
      Indemnifying Person; provided, that the failure of the Indemnified Person
      to give notice shall not relieve the Indemnifying Person of its
      obligations under this Article X except to the extent (if any) that the
      Indemnifying Person shall have been prejudiced thereby. If the
      Indemnifying Person does not object in writing to such indemnification
      claim within thirty (30) calendar days of receiving notice thereof, the
      Indemnified Person shall be entitled to recover promptly from the
      Indemnifying Person and the Indemnifying Person shall promptly pay to the
      Indemnified Person the amount of such claim (but such recovery shall not
      limit the amount of any additional indemnification to which the
      Indemnified Person may be entitled pursuant to Section 10.2 or 10.3), and
      no later objection by the Indemnifying Person shall be permitted.
 IV.  Notice of Third Party Claims; Assumption of Defense. The Indemnified
      Person shall give notice as promptly as is reasonably practicable to the
      Indemnifying Person of the assertion of any claim, or the commencement of
      any suit, action or proceeding, by any Person not a party hereto in
      respect of which indemnity may be sought under this Agreement; provided,
      that the failure of the Indemnified Person to give notice shall not
      relieve the Indemnifying Person of its obligations under this Article X
      except to the extent (if any) that the Indemnifying Person shall have been
      prejudiced thereby. The Indemnifying Person may, at its own expense, (a)
      participate in the defense of any such claim, suit, action or proceeding
      and (b) upon notice to the Indemnified Person and the Indemnifying
      Person's delivering to the Indemnified Person a written agreement that the
      Indemnified Person is entitled to indemnification pursuant to Section 10.2
      or 10.3 for all Losses arising out of such claim, suit, action or
      proceeding and that the Indemnifying Person shall be liable for the entire
      amount of any Loss resulting therefrom, at any time during the course of
      any such claim, suit, action or proceeding, assume the defense thereof;
      provided, that (i) the Indemnifying Person's counsel is reasonably
      satisfactory to the Indemnified Person and (ii) the Indemnifying Person
      shall thereafter consult with the Indemnified Person upon the Indemnified
      Person's reasonable request for such consultation from time to time with
      respect to such claim, suit, action or proceeding. If the Indemnifying
      Person assumes such defense, the Indemnified Person shall have the right
      (but not the duty) to participate in the defense thereof and to employ
      counsel, at its own expense, separate from the counsel employed by the
      Indemnifying Person. If, however, the Indemnified Person reasonably
      determines in its judgment that representation by the Indemnifying
      Person's counsel of both the Indemnifying Person and the Indemnified
      Person would present such counsel with a conflict of interest, then such
      Indemnified Person may employ separate counsel to represent or defend it
      in any such claim, action, suit or proceeding and the Indemnifying Person
      shall pay the fees and disbursements of such separate counsel. Whether or
      not the Indemnifying Person chooses to defend or prosecute any such claim,
      suit, action or proceeding, all of the parties hereto shall cooperate in
      the defense or prosecution thereof.
 V.   Settlement or Compromise. Any settlement or compromise made or caused to
      be made by the Indemnified Person or the Indemnifying Person, as the case
      may be, of any such claim, suit, action or proceeding of the kind referred
      to in Section 10.5 shall also be binding upon the Indemnifying Person or
      the Indemnified Person, as the case may be, in the same manner as if a
      final judgment or decree had been entered by a court of competent
      jurisdiction in the amount of such settlement or compromise; provided,
      that no obligation, restriction or Loss shall be imposed on the
      Indemnified Person as a result of such settlement without its prior
      written consent. The Indemnified Person will give the Indemnifying Person
      at least thirty (30) days' notice of any proposed settlement or compromise
      of any claim, suit, action or proceeding referred to in Section 10.5 that
      it is defending, during which time the Indemnifying Person may reject such
      proposed settlement or compromise; provided, that from and after such
      rejection, the Indemnifying Person shall be obligated to assume the
      defense of and full and complete liability and responsibility for such
      claim, suit, action or proceeding and any and all Losses in connection
      therewith in excess of the amount of unindemnifiable Losses which the
      Indemnified Person would have been obligated to pay under the proposed
      settlement or compromise.
 VI.  Failure of Indemnifying Person to Act. In the event that the Indemnifying
      Person does not elect to assume the defense of any claim, suit, action or
      proceeding, then any failure of the Indemnified Person to defend or to
      participate in the defense of any such claim, suit, action or proceeding
      or to cause the same to be done, shall not relieve the Indemnifying Person
      of its obligations hereunder.
 VII. Purchase Price Adjustments. Any amounts payable under Section 10.2 or
      Section 10.3 shall be treated by Purchaser and Seller as an adjustment to
      the Purchase Price allocated to the Shares pursuant to Section 2.2(a).

NON-COMPETITION

 1. Non-Competition Agreement. Each of Seller and Schlatter agrees that from and
    after the Closing Date until two (2) years after the last date on which a
    component of the Purchase Price is based (i.e. December 31, 2012) (the
    "Non-Competition Period"), neither it nor any of its Affiliates will,
    directly or indirectly, in the United States, Canada or Mexico:
     a. engage in, or own, have any interest in, control, manage, serve as a
        director, officer or employee of, or, except as provided below, advise,
        act as a consultant to, render services for, receive any economic
        benefit from or exert any influence upon, any Person (a "Competing
        Person") that engages in, or is in competition with, the business
        presently or previously conducted by the Company; provided, that the
        forgoing shall not prohibit either Seller or Schlatter or any of their
        Affiliates from owning up to an aggregate of one percent (1%) of the
        outstanding shares of any class of capital stock of any publicly traded
        Competing Person so long as neither Seller, Schlatter nor any of their
        Affiliates have any participation in the management of such Competing
        Person; provided further, that nothing in this Article XI shall prohibit
        Schlatter or any of its Affiliates from offering or selling capital
        equipment or from providing technical support or consulting services in
        connection with such sales of capital equipment;
     b. solicit, divert or attempt to solicit or divert any Person who is on the
        Closing Date, or was during fiscal years 2001 or 2002, a customer or
        supplier of the Company;
     c. employ, solicit for employment or encourage to leave his or her
        employment, any individual who was during the two (2)-year period prior
        to such employment, solicitation or encouragement or is an officer or
        employee of the Company;
     d. impair, or attempt to impair, any business relationship between any
        third party and the Company; or
     e. make any statement to any third party, including the press or media,
        likely to result in adverse publicity for the Company or any of its
        Affiliates.

    In the event of a breach or violation by either Seller or Schlatter of any
    of the provisions of this Article XI, the Non-Competition Period shall be
    extended as to such Person by a period equal to (i) the length of the breach
    or violation of this Article XI plus (ii) the length of any court
    proceedings necessary to stop such breach or violation.

 2. Severability. If at any time any of the provisions of this Article XI shall
    be determined to be invalid or unenforceable by reason of being vague or
    unreasonable as to duration, area or scope of activity, or otherwise, then
    this Article XI shall be considered divisible (with the other provisions to
    remain in full force and effect) and the invalid or unenforceable provisions
    shall become and be deemed to be immediately amended to include only such
    time, area, scope of activity and other restrictions, as shall be determined
    to be reasonable and enforceable by the court or other body having
    jurisdiction over the matter, and Seller and Schlatter each expressly agrees
    that this Agreement, as so amended, shall be valid and binding as though any
    invalid or unenforceable provision had not been included herein.
 3. No Limitation of Other Provisions. The provisions of this Article XI shall
    be in addition to, and not in limitation of, any other provisions contained
    in any other agreement restricting competition by Seller or Schlatter.

MISCELLANEOUS

 1.  Expenses. Each party hereto shall bear its own fees and expenses with
     respect to the transactions contemplated hereby. Seller shall pay all
     sales, use, stamp, transfer, service, recording and like taxes or fees, if
     any, imposed by any Governmental Authority in connection with the transfer
     and assignment of its Shares.
 2.  Amendment. This Agreement may be amended, modified or supplemented but only
     in writing signed by Purchaser, Seller and the Company.
 3.  Notices. Any notice, request, instruction or other document to be given
     hereunder by a party hereto shall be in writing and shall be deemed to have
     been given, (a) when received if given in person or by courier or a courier
     service, (b) on the date of transmission if sent by telex, facsimile or
     other wire transmission (receipt confirmed) or (c) three (3) Business Days
     after being deposited in the U.S. mail, certified or registered mail,
     postage prepaid:
      i.   If to Seller or Schlatter, addressed as follows:
     
           Schlatter International AG
     
           Brandstrasse 24
     
           CH-8952 Schlieren
     
           Attention: Franz Buchmann
           Facsimile No.: 011-41-1-730-9476
     
           with a copy to:
     
           Moore & Bruce, LLP
           1072 Thomas Jefferson Street, N.W.
           Washington, D.C. 20007-3835
           Attention: Jonathon R. Moore
           Facsimile No.: (202) 965-7745
     
      ii.  If to the Company, addressed as follows:
     
           Structural Reinforcement Products, Inc.
           Box 409 A
           Forest Road
           Hazleton, PA 18201
           Attention: William Duffy
           Facsimile No.: (570) 450-2095
     
      iii. If to Purchaser, addressed as follows:

     MMI Products, Inc.
     515 West Greens Road, Suite 710
     Houston, Texas 77067
     Attention: Chief Financial Officer
     Facsimile No.: (281) 876-1648

     with a copy to:

     Mayer, Brown, Rowe & Maw
     1909 K. Street, N.W.
     Washington, D.C. 20006
     Attention: Stuart P. Pergament
     Facsimile No.: (202) 263-3300

     or to such other individual or address as a party hereto may designate for
     itself by notice given as herein provided.

 4.  Effect of Investigation. Any due diligence review, audit or other
     investigation or inquiry undertaken or performed by or on behalf of
     Purchaser shall not limit, qualify, modify or amend the representations,
     warranties, covenants or obligations of (including indemnities by) Seller,
     Schlatter or the Company made or undertaken pursuant to this Agreement or
     any of their Related Agreements, irrespective of the knowledge and
     information received (or which should have been received) therefrom by
     Purchaser.
 5.  Payments in Dollars. Except as otherwise provided herein or in a Related
     Agreement, all payments pursuant hereto shall be made by wire transfer in
     U.S. Dollars in same day or immediately available funds, without any
     set-off, deduction or counterclaim whatsoever; provided that Purchaser may
     set-off against any payments owed to Seller pursuant to Article II all
     amounts it, or its Affiliates reasonably believe they are owed pursuant to
     this Agreement or any Related Agreement.
 6.  Waivers. The failure of a party hereto at any time or times to require
     performance of any provision hereof shall in no manner affect its right at
     a later time to enforce the same. No waiver by a party of any condition or
     of any breach of any term, covenant, representation or warranty contained
     in this Agreement shall be effective unless in writing, and no waiver in
     any one or more instances shall be deemed to be a further or continuing
     waiver of any such condition or breach in other instances or a waiver of
     any other condition or breach of any other term, covenant, representation
     or warranty.
 7.  Counterparts. This Agreement may be executed in counterparts, each of which
     shall be deemed an original, but all of which together shall constitute one
     and the same instrument.
 8.  Assignment. This Agreement shall be binding upon and inure to the benefit
     of the parties hereto and their respective successors and assigns;
     provided, that no assignment of any rights or obligations hereunder shall
     be made by Seller, Schlatter or the Company without the written consent of
     Purchaser and no assignment of any rights or obligations hereunder shall be
     made by Purchaser to any Person, other than to an Affiliate of Purchaser,
     without the written consent of Seller. Notwithstanding the foregoing,
     Purchaser and the Company may grant a security interest in and collaterally
     assign their respective rights and interests herein to their respective
     lenders.
 9.  No Third Party Beneficiaries. This Agreement is solely for the benefit of
     the parties hereto and, to the extent provided herein, their respective
     Affiliates, directors, officers, employees, agents and representatives, and
     no provision of this Agreement shall be deemed to confer upon other third
     parties any remedy, claim, liability, reimbursement, cause of action or
     other right.
 10. Publicity. Prior to the Closing Date, no public announcement or other
     publicity regarding the existence of this Agreement or its contents or the
     transactions contemplated hereby shall be made by Purchaser, Seller,
     Schlatter, the Company or any of their respective Affiliates, officers,
     directors, employees, representatives or agents, without the prior written
     agreement of Purchaser and Seller, in any case, as to form, content, timing
     and manner of distribution or publication; provided, that nothing in this
     Section 12.10 shall prevent any party from (a) making any public
     announcement required by Law or the rules of any stock exchange so long as,
     if such party is Purchaser, Purchaser consults with Seller, and if such
     party is either Seller, Schlatter or the Company, Person consults with
     Purchaser, in each case as to the form, content, timing and manner of
     distribution or publication, (b) discussing this Agreement or its contents
     or the transactions contemplated hereby with those Persons whose approval,
     agreement or opinion, as the case may be, is required for consummation of
     such particular transaction or transactions or (c) enforcing its rights
     hereunder.
 11. Further Assurances. Upon the reasonable request of Purchaser, Seller,
     Schlatter shall on and after the Closing Date execute and deliver to
     Purchaser such other documents, releases, assignments and other instruments
     as may be required to effectuate completely the transfer and assignment to
     Purchaser of, and to vest fully in Purchaser title to, the Shares, and to
     otherwise carry out the purposes of this Agreement.
 12. Severability. If any provision of this Agreement shall be held invalid,
     illegal or unenforceable, the validity, legality or enforceability of the
     other provisions hereof shall not be affected thereby, and there shall be
     deemed substituted for the provision at issue a valid, legal and
     enforceable provision as similar as possible to the provision at issue.
 13. Specific Performance. Each party recognizes and affirms that in the event
     of breach by him or it of any of the provisions of Sections 5.2 or 5.8 or
     Article XI, money damages would be inadequate and the other parties would
     have no adequate remedy at law. Accordingly, each party agrees that the
     other parties shall have the right, in addition to any other rights and
     remedies existing in their favor, to enforce their respective rights and
     the breaching party's obligations under Sections 5.2 and 5.8 and Article XI
     not only by an action or actions for damages, but also by an action or
     actions for specific performance, injunction and/or other equitable relief
     in order to enforce or prevent any violations (whether anticipatory,
     continuing or future) of the provisions of Sections 5.2 or 5.8 or Article
     XI. If a bond is required to be posted in order for any party to secure an
     injunction, the parties agree that such bond need not exceed the sum of
     $1,000.
 14. Remedies Cumulative. The remedies provided in this Agreement shall be
     cumulative and shall not preclude the assertion or exercise of any other
     rights or remedies available by Law, in equity or otherwise.
 15. Entire Understanding. This Agreement and the Related Agreements set forth
     the entire agreement and understanding of the parties hereto with respect
     to the transactions contemplated hereby and supersede any and all prior
     agreements, arrangements and understandings among the parties relating to
     the subject matter hereof, including that certain letter of intent dated
     October 25, 2002, as extended on November 27, 2002, except that the
     Non-Disclosure Agreement dated January 16, 2002 shall remain binding on
     Seller, Schlatter and Purchaser.
 16. Applicable Law. This Agreement shall be governed by and construed and
     enforced in accordance with the internal laws of the State of Delaware
     applicable to agreements negotiated, executed and performed in the State of
     Delaware by parties resident in Delaware without giving effect to the
     principles of conflicts of law thereof.
 17. Jurisdiction of Disputes; Waiver of Jury Trial. In the event any party to
     this Agreement commences any litigation, proceeding or other legal action
     in connection with or relating to this Agreement, any Related Agreement or
     any matters described or contemplated herein or therein, the parties to
     this Agreement hereby (a) agree that any such litigation, proceeding or
     other legal action may be brought in a court of competent jurisdiction
     located within the County of Philadelphia, Pennsylvania, whether a state or
     federal court; (b) agree that in connection with any such litigation,
     proceeding or action, such parties will consent and submit to personal
     jurisdiction in any such court described in clause (a) of this Section
     12.17 and to service of process upon them in accordance with the rules and
     statutes governing service of process; (c) agree to waive to the full
     extent permitted by law any objection that they may now or hereafter have
     to the venue of any such litigation, proceeding or action in any such court
     or that any such litigation, proceeding or action was brought in an
     inconvenient forum; (d) designate, appoint and direct CT Corporation System
     as their authorized agent to receive on their behalf service of any and all
     process and documents in any legal proceeding in the Commonwealth of
     Pennsylvania; (e) agree to notify the other parties to this Agreement
     immediately if such agent shall refuse to act, or be prevented from acting,
     as agent and, in such event, promptly to designate another agent in the
     Commonwealth of Pennsylvania to serve in place of such agent and deliver to
     the other parties written evidence of such substitute agent's acceptance of
     such designation; (f) agree as an alternative method of service to service
     of process in any litigation, proceeding or action by mailing of copies
     thereof to the parties at their addresses set forth in Section 12.3; (g)
     agree that any service made as provided herein shall be effective and
     binding service in every respect; and (h) agree that nothing herein shall
     affect the rights of any party to effect service of process in any other
     manner permitted by Law. EACH PARTY HERETO WAIVES THE RIGHT TO A TRIAL BY
     JURY IN ANY DISPUTE IN CONNECTION WITH OR RELATING TO THIS AGREEMENT, ANY
     RELATED AGREEMENT OR ANY MATTERS DESCRIBED OR CONTEMPLATED HEREIN OR
     THEREIN, AND AGREES TO TAKE ANY AND ALL ACTION NECESSARY OR APPROPRIATE TO
     EFFECT SUCH WAIVER.

* * *

IN WITNESS WHEREOF,

the parties hereto have caused this Agreement to be executed and delivered as of
the date first above written.

MMI PRODUCTS, INC.

 

 

By: _________________________________

Name:

Title:

STRUCTURAL REINFORCEMENT PRODUCTS, INC.

 

 

By:________________________________

Name: Charles M. Bruce

Title: Chairman

QUILNI B.V.

 

 

By: ________________________________

Name:

Title:

FOR PURPOSES OF
ARTICLE X, XI AND XII ONLY:

SCHLATTER HOLDING AG

 

By:_________________________________

Name:

Title:

[Stock Purchase Agreement Signature Page]