Exhibit 2.2








                          AGREEMENT AND PLAN OF MERGER

                                      AMONG

                      APPLIED GRAPHICS TECHNOLOGIES, INC.,
                              AGT ACQUISITION CORP.
                                       AND
                                DEVON GROUP, INC.



















<PAGE>


                                TABLE OF CONTENTS

                                                                         Page

                                       ARTICLE 1
                                      THE MERGER..............................3

 SECTION 1.1.    The Merger...................................................3
 SECTION 1.2.    Effective Time...............................................3
 SECTION 1.3.    Closing of the Merger........................................4
 SECTION 1.4.    Effects of the Merger........................................4
 SECTION 1.5.    Certificate of Incorporation and Bylaws......................4
 SECTION 1.6.    Directors....................................................4
 SECTION 1.7.    Officers.....................................................4

                                       ARTICLE 2
                      CONVERSION OF SHARES; MERGER CONSIDERATION..............4

 SECTION 2.1.    Conversion of Shares.........................................4
 SECTION 2.2.    Exchange of Certificates and Cash............................6
 SECTION 2.3.    Stock Options................................................7

                                       ARTICLE 3
                            REPRESENTATIONS AND WARRANTIES
                                    OF THE COMPANY............................8

 SECTION 3.1.    Organization and Qualification...............................8
 SECTION 3.2.    Capitalization of the Company and its Subsidiaries...........8
 SECTION 3.3.    Authority Relative to this Agreement.........................9
 SECTION 3.4.    SEC Reports; Financial Statements...........................10
 SECTION 3.5.    Information Supplied........................................10
 SECTION 3.6.    Consents and Approvals; No Violations.......................11
 SECTION 3.7.    No Default..................................................11
 SECTION 3.8.    No Undisclosed Liabilities; Absence of Changes..............12
 SECTION 3.9.    Litigation..................................................12
 SECTION 3.10.   Compliance with Applicable Law..............................12
 SECTION 3.11.   Employee Plans..............................................13
 SECTION 3.12.   Environmental Matters.......................................14
 SECTION 3.13.   Tax Matters.................................................16
 SECTION 3.14.   Intellectual Property.......................................18
 SECTION 3.15.   Opinion of Financial Advisor................................19
 SECTION 3.16.   Brokers.....................................................19
 SECTION 3.17.   Material Contracts..........................................19
 SECTION 3.18.   Labor Matters...............................................20
 SECTION 3.19.   Insurance...................................................20
 SECTION 3.20.   Customers...................................................20

                                       ARTICLE 4
                            REPRESENTATIONS AND WARRANTIES
                                OF AGT AND ACQUISITIONS......................20

 SECTION 4.1.    Organization and Qualification..............................20
 SECTION 4.2.    Capitalization of AGT and its Subsidiaries..................21
 SECTION 4.3.    Authority Relative to this Agreement........................22
 SECTION 4.4.    SEC Reports; Financial Statements...........................22
 SECTION 4.5.    Information Supplied........................................23
 SECTION 4.6.    Consents and Approvals; No Violations.......................23
 SECTION 4.7.    No Default..................................................24
 SECTION 4.8.    No Undisclosed Liabilities; Absence of Changes..............24
 SECTION 4.9.    Litigation..................................................24
 SECTION 4.10.   Compliance with Applicable Law..............................24
 SECTION 4.11.   Employee Plans..............................................25
 SECTION 4.12.   Environmental Matters.......................................26
 SECTION 4.13.   Tax Matters.................................................27
 SECTION 4.14.   Intellectual Property.......................................29
 SECTION 4.15.   Material Contracts..........................................29
 SECTION 4.16.   Labor Matters...............................................30
 SECTION 4.17.   Insurance...................................................30
 SECTION 4.18.   Customers...................................................30
 SECTION 4.19.   No Prior Activities.........................................30
 SECTION 4.20.   Opinion of Financial Advisor................................30
 SECTION 4.21.   Brokers.....................................................30
 SECTION 4.22.   Ownership of Company Common Stock...........................30

                                       ARTICLE 5
                                       COVENANTS.............................31

 SECTION 5.1.    Conduct of Business.........................................31
 SECTION 5.2.    Preparation of S-4 and the Joint Proxy Statement............34
 SECTION 5.3.    No Solicitation.............................................34
 SECTION 5.4.    Letters of the Company's and AGT's Accountants..............36
 SECTION 5.5.    Meetings....................................................36
 SECTION 5.6.    Access to Information.......................................37
 SECTION 5.7.    Additional Agreements; Reasonable Best Efforts..............37
 SECTION 5.8.    Antitrust Reviews...........................................38
 SECTION 5.9.    Public Announcements........................................38
 SECTION 5.10.   Indemnification; Directors' and Officers' Insurance.........38
 SECTION 5.11.   Notification of Certain Matters.............................39
 SECTION 5.12.   Tax-Free Reorganization Treatment...........................39
 SECTION 5.13.   Company Employee Benefits...................................40
 SECTION 5.14.   Certain Payment of Deferred Compensation and Bonuses........40
 SECTION 5.15.   Stock Options...............................................40
 SECTION 5.16.   SEC Filings.................................................40
 SECTION 5.17.   Guarantee of Performance....................................40

                                       ARTICLE 6
                              CONDITIONS TO CONSUMMATION
                                     OF THE MERGER...........................40

 SECTION 6.1.    Conditions to Each Party's Obligations to Effect............
                 the Merger..................................................40
 SECTION 6.2.    Conditions to the Obligations of the Company................41
 SECTION 6.3.    Conditions to the Obligations of AGT and Acquisition........42

                                       ARTICLE 7
                            TERMINATION; AMENDMENT; WAIVER...................42

 SECTION 7.1.    Termination.................................................42
 SECTION 7.2.    Effect of Termination.......................................43
 SECTION 7.3.    Fees and Expenses...........................................43
 SECTION 7.4.    Amendment...................................................44
 SECTION 7.5.    Extension; Waiver...........................................44

                                       ARTICLE 8
                                     MISCELLANEOUS...........................45

 SECTION 8.1.    Nonsurvival of Representations and Warranties...............45
 SECTION 8.2.    Entire Agreement; Assignment................................45
 SECTION 8.3.    Notices.....................................................45
 SECTION 8.4.    Governing Law...............................................46
 SECTION 8.5.    Descriptive Headings........................................46
 SECTION 8.6.    Interpretive Provisions; Certain Definitions................46
 SECTION 8.7.    Parties in Interest.........................................46
 SECTION 8.8.    Severability................................................46
 SECTION 8.9.    Specific Performance........................................46
 SECTION 8.10.   Brokers.....................................................46
 SECTION 8.11.   Counterparts................................................47





<PAGE>


                          AGREEMENT AND PLAN OF MERGER


                  THIS  AGREEMENT  AND PLAN OF MERGER,  dated as of February 13,
1998 (the "Agreement"), is among APPLIED GRAPHICS TECHNOLOGIES, INC., a Delaware
corporation  ("AGT"),  AGT  ACQUISITION  CORP.,  a  Delaware  corporation  and a
wholly-owned  subsidiary  of AGT  ("Acquisition"),  and  DEVON  GROUP,  INC.,  a
Delaware corporation (the "Company").

                  WHEREAS,   the   respective   Boards  of   Directors  of  AGT,
Acquisition  and the  Company  have  determined  that the Merger (as  defined in
Section  1.1)  is  fair  to  and in  the  best  interests  of  their  respective
stockholders and have approved the Merger in accordance with this Agreement;

                  WHEREAS, for federal income tax purposes,  it is intended that
the Merger  shall  qualify as a tax-free  reorganization  within the  meaning of
Section 368(a) of the Internal Revenue Code of 1986, as amended (the "Code");

                  WHEREAS,  concurrently  with  the  execution  hereof,  certain
holders of Shares (as defined in Section  2.1) are  entering  into an  agreement
(the  "Stockholders  Agreement")  providing for certain  matters with respect to
their Shares, a copy of which is attached hereto as Exhibit A;

                  WHEREAS, the Company has delivered to AGT a letter identifying
all  persons  (each,  a  "Company  Affiliate")  who  are,  at the  date  hereof,
"affiliates" of the Company for purposes of Rule 145 under the Securities Act of
1933,  as  amended  (the  "Securities  Act"),  and each  Company  Affiliate  has
delivered to AGT a letter  (each,  an  "Affiliate  Letter")  relating to (i) the
transfer, prior to the Effective Time (as defined in Section 1.2), of the Shares
beneficially  owned by such  Company  Affiliate  on the date hereof and (ii) the
transfer of the shares of AGT Common Stock (as defined in Section  2.1(d)) to be
received by such Company Affiliate in the Merger; and

                  WHEREAS,  AGT,  Acquisition  and the  Company  desire  to make
certain representations, warranties, covenants and agreements in connection with
the Merger and also to prescribe various conditions to the Merger.

                  NOW,  THEREFORE,  in  consideration  of the  premises  and the
mutual representations,  warranties,  covenants and agreements herein contained,
AGT, Acquisition and the Company hereby agree as follows:


                                    ARTICLE 1

                                   THE MERGER

                  SECTION 1.1. The Merger.  At the  Effective  Time and upon the
terms and subject to the conditions of this Agreement and in accordance with the
Delaware General Corporation Law (the "DGCL"),  the Company shall be merged with
and into Acquisition  (the "Merger").  Following the Merger,  Acquisition  shall
continue as the surviving  corporation  (the  "Surviving  Corporation")  and the
separate corporate existence of the Company shall cease.

                  SECTION 1.2. Effective Time. Subject to the provisions of this
Agreement,  AGT,  Acquisition  and the  Company  shall  cause  the  Merger to be
consummated by filing an appropriate  Certificate of Merger or other appropriate
documents (the "Certificate of Merger") with the Secretary of State of the State
of Delaware in such form as required by, and executed in  accordance  with,  the
relevant  provisions of the DGCL, as soon as practicable on or after the Closing
Date (as defined in Section 1.3).  The Merger shall become  effective  upon such
filing or at such time  thereafter as is provided in the  Certificate  of Merger
(the "Effective Time").

                  SECTION 1.3. Closing of the Merger.  The closing of the Merger
(the  "Closing")  will take place at a time and on a date to be specified by the
parties,  which shall be the third business day after  satisfaction or waiver of
the  conditions set forth in Article 6 (the "Closing  Date"),  at the offices of
Weil, Gotshal & Manges LLP, 767 Fifth Avenue,  New York, New York 10153,  unless
another time, date or place is agreed to in writing by the parties hereto.

                  SECTION 1.4. Effects of the Merger.  The Merger shall have the
effects set forth in the DGCL. Without limiting the generality of the foregoing,
and  subject  thereto,  at the  Effective  Time,  all  the  properties,  rights,
privileges,  powers and franchises of the Company and Acquisition  shall vest in
the Surviving Corporation,  and all debts, liabilities and duties of the Company
and Acquisition shall become the debts,  liabilities and duties of the Surviving
Corporation.

                  SECTION 1.5.  Certificate  of  Incorporation  and Bylaws.  The
Certificate  of  Incorporation  of  Acquisition  in effect at the Effective Time
shall be the Certificate of  Incorporation  of the Surviving  Corporation  until
amended in accordance  with  applicable law. The Bylaws of Acquisition in effect
at the  Effective  Time shall be the Bylaws of the Surviving  Corporation  until
amended in accordance with applicable law.

                  SECTION 1.6.  Directors.  The directors of  Acquisition at the
Effective Time shall be the initial directors of the Surviving Corporation, each
to hold office in accordance with the Certificate of Incorporation and Bylaws of
the Surviving  Corporation  until such  director's  successor is duly elected or
appointed  and  qualified.  On or prior  to the  Closing  Date,  the  number  of
directors  of AGT shall be increased by two and the  vacancies  created  thereby
shall  be  initially  filled  by  Marne  Obernauer,  Jr.  and a  designee  to be
determined jointly by the Company and AGT.

                  SECTION  1.7.  Officers.  The  officers  of the Company at the
Effective Time shall be the initial officers of the Surviving Corporation,  each
to hold office in accordance with the Certificate of Incorporation and Bylaws of
the  Surviving  Corporation  until such  officer's  successor is duly elected or
appointed and qualified.


                                    ARTICLE 2

                   CONVERSION OF SHARES; MERGER CONSIDERATION

                  SECTION 2.1.  Conversion of Shares.  At the Effective Time, by
virtue of the Merger and  without  any action on the part of any of the  parties
hereto or any holder of shares of the Company's common stock, par value $.01 per
share (the "Company Common Stock"):

                  (a) Common Stock of  Acquisition.  Each issued and outstanding
share of common  stock,  par value  $0.01 per  share,  of  Acquisition  shall be
converted  into one share of common  stock,  par value  $0.01 per share,  of the
Surviving Corporation.

                  (b) Cancellation of Treasury Shares and AGT-Owned Shares. Each
Share (as defined in Section  2.1(c)) that is owned by the  Company,  or by AGT,
Acquisition or any other subsidiary of AGT shall  automatically be cancelled and
retired and shall cease to exist,  and no cash or other  consideration  shall be
delivered or deliverable in exchange therefor.

                  (c) Common Stock of the Company.  Each share of Company Common
Stock issued and  outstanding  immediately  prior to the Effective Time (each, a
"Share"),  other than Shares to be cancelled in accordance  with Section  2.1(b)
and any  Dissenting  Shares (as defined in Section  2.1(e)),  shall no longer be
outstanding and shall  automatically be cancelled and retired and shall cease to
exist,  and  each  certificate  evidencing  any  such  Shares  shall  thereafter
represent  the right to  receive,  upon the  surrender  of such  certificate  in
accordance  with the  provisions  of Section 2.2, the Merger  Consideration  (as
defined in Section 2.1(d))  multiplied by the number of Shares  evidenced by the
cancelled  certificate.  The holders of such certificates  previously evidencing
such Shares  outstanding  immediately prior to the Effective Time shall cease to
have any rights with respect to such Shares except as otherwise  provided herein
or by law.

                  (d)  Merger  Consideration.  The term  "Merger  Consideration"
means (i) a cash  payment  in an amount  equal to $30.00  (the "Per  Share  Cash
Amount") and (ii) .6 fully paid and  nonassessable  shares of common stock,  par
value $.01 per share of AGT ("AGT Common Stock").

                  (e)  Dissenting  Shares.   Notwithstanding  anything  in  this
Agreement to the contrary,  Shares issued and outstanding  immediately  prior to
the  Effective  Time held by a holder (if any) who has the right to demand,  and
who properly demands, an appraisal of such Shares in accordance with Section 262
of the DGCL (or any  successor  provision)  ("Dissenting  Shares")  shall not be
converted into a right to receive the Merger  Consideration,  unless such holder
fails to perfect or otherwise  loses such holder's right to such  appraisal,  if
any. If,  after the  Effective  Time,  such holder fails to perfect or loses any
such right to  appraisal,  each such Share of such holder  shall be treated as a
Share that had been converted as of the Effective Time into the right to receive
the Merger Consideration. At the Effective Time, any holder of Dissenting Shares
shall cease to have any rights with respect thereto,  except the rights provided
in Section 262 of the DGCL (or any successor  provision)  and as provided in the
immediately  preceding sentence.  The Company shall give prompt notice to AGT of
any demands received by the Company for appraisal of Shares,  and AGT shall have
the right to participate in and direct all  negotiations  and  proceedings  with
respect to such demands.  The Company  shall not,  except with the prior written
consent of AGT,  make any payment with respect to, or settle or offer to settle,
any such demands.

                  (f) Adjustment.  If, based on the Merger Consideration payable
pursuant to Section 2.1(d),  the tax opinions referred to in Sections 6.2(c) and
6.3(f) hereof cannot be delivered as a result of the Merger potentially  failing
to satisfy  continuity of interest  requirements under applicable federal income
tax principles relating to reorganizations  under Section 368(a) of the Code (as
reasonably  determined  by Weil,  Gotshal & Manges  LLP and  O'Sullivan  Graev &
Karabell,  LLP, such determination to be made (x) taking into account Dissenting
Shares  and cash  issued in lieu of  fractional  shares,  if any,  (y) using the
Closing  Date Price as the  measure  of value of the shares of AGT Common  Stock
issued as Merger  Consideration  and (z) requiring  that the total value of such
AGT Common  Stock issued as Merger  Consideration  represent no less than 45% of
the total consideration  issued and to be issued in the Merger to all holders of
Shares),  then the Merger  Consideration  shall be adjusted by reducing,  to the
extent  necessary to enable the tax opinions to be rendered,  the amount of cash
to be delivered to the holders of Shares, for each Share converted,  and in lieu
thereof  delivering  to such  holders  such number of shares of AGT Common Stock
equal to (x) the amount by which the cash component of the Merger  Consideration
is reduced, pursuant to this clause, in order to enable the rendering of the tax
opinions, divided by (y) the Closing Date Price.

                  For purposes  hereof,  the "Closing  Date Price" of a share of
AGT  Common  Stock  shall be the  closing  sales  price of AGT  Common  Stock as
reported on the Nasdaq National Market ("NASDAQ") as of the close of the trading
day immediately prior to the Closing Date.

                  SECTION 2.2.  Exchange of Certificates and Cash.

                  (a) Exchange  Agent. On the Effective Date, AGT shall deposit,
or  shall  cause to be  deposited,  with or for the  account  of a bank or trust
company designated by AGT, which shall be reasonably satisfactory to the Company
(the  "Exchange  Agent"),  for the benefit of the holders of Shares  (other than
Dissenting Shares),  for exchange in accordance with this Article 2, through the
Exchange Agent, (i) certificates evidencing the whole shares of AGT Common Stock
issuable  pursuant to Sections 2.1(d) and 2.1(f), to the extent  applicable,  in
exchange for outstanding  Shares,  (ii) cash in the aggregate amount required to
be exchanged for Shares  pursuant to Sections  2.1(d) and 2.1(f),  to the extent
applicable,  and (iii) cash in an amount  sufficient  to permit  payment of cash
payable  in lieu of  fractional  shares  pursuant  to Section  2.2(d)  (the cash
described  in (ii)  and  (iii)  is  hereafter  collectively  referred  to as the
"Exchange Cash  Consideration"  and such  certificates  for shares of AGT Common
Stock,  together with any dividends or distributions  with respect thereto,  and
the Exchange Cash  Consideration are hereafter  collectively  referred to as the
"Exchange   Fund").   The  Exchange   Agent  shall,   pursuant  to   irrevocable
instructions,  deliver the Merger Consideration to holders of Shares.  Except as
contemplated  by Section 2.2(d) hereof,  the Exchange Fund shall not be used for
any  other  purpose.  Any  interest,  dividends  or other  income  earned on the
investment  of cash or other  property  held in the  Exchange  Fund  (except for
dividends on shares of AGT Common Stock) shall be for the account of AGT.

                  (b) Exchange  Procedures.  As soon as  reasonably  practicable
after the Effective  Time,  AGT will instruct the Exchange Agent to mail to each
holder of record of a certificate or certificates which immediately prior to the
Effective Time evidenced  outstanding  Shares (the  "Certificates"),  other than
Dissenting  Shares,  (i) a letter  of  transmittal  (which  shall  specify  that
delivery shall be effected, and risk of loss and title to the Certificates shall
pass,  only upon proper  delivery of the  Certificates to the Exchange Agent and
shall be in such  form and have  such  other  provisions  as AGT may  reasonably
specify) and (ii)  instructions  to effect the surrender of the  Certificates in
exchange for the  certificates  evidencing  shares of AGT Common Stock and cash.
Upon surrender of a Certificate for  cancellation to the Exchange Agent together
with  such  letter of  transmittal,  duly  executed,  and such  other  customary
documents as may be required pursuant to such  instructions,  the holder of such
Certificate  shall be  entitled  to  receive  in  exchange  therefor  the Merger
Consideration, multiplied by the number of Shares evidenced by such Certificate,
and the Certificate so surrendered shall forthwith be cancelled. In the event of
a transfer  of  ownership  of Shares  which is not  registered  in the  transfer
records of the  Company,  shares of AGT Common  Stock and cash may be issued and
paid in  accordance  with this  Article  2 to a  transferee  if the  Certificate
evidencing  such Shares is presented to the Exchange  Agent,  accompanied by all
documents required to evidence and effect such transfer and by evidence that any
applicable   stock  transfer  taxes  have  been  paid.   Until   surrendered  as
contemplated by this Section 2.2, each  Certificate  shall be deemed at any time
after  the  Effective  Time to  evidence  only the  right to  receive  upon such
surrender  the  Merger  Consideration,   multiplied  by  the  number  of  Shares
previously evidenced by such Certificate.

                  (c)  Distributions  With Respect to Unexchanged  Shares of AGT
Common Stock. No dividends or other  distributions with respect to shares of AGT
Common Stock,  with a record date after the Effective Time, shall be paid to the
holder of any unsurrendered Certificate with respect to the shares of AGT Common
Stock they are entitled to receive  until the holder of such  Certificate  shall
surrender such Certificate.

                  (d)  Fractional  Shares.  No fraction of a share of AGT Common
Stock shall be issued in the Merger. In lieu of any such fractional shares, each
holder of Shares  entitled to receive  shares of AGT Common Stock in the Merger,
upon surrender of a Certificate for exchange pursuant to this Section 2.2, shall
be paid an amount in cash  (without  interest),  rounded  to the  nearest  cent,
determined  by  multiplying  (x) the per share  closing  price of a share of AGT
Common  Stock on the NASDAQ on the date of the  Effective  Time (or the last bid
price in the  absence of a trade) by (y) the  fractional  interest in AGT Common
Stock to which such  holder  would  otherwise  be  entitled  (after  taking into
account all Shares then held of record by such holder).

                  (e)  Termination of Exchange Fund. Any portion of the Exchange
Fund which remains  undistributed  to the holders of Shares for six months after
the Effective  Time shall be delivered to AGT,  upon demand,  and any holders of
Shares who have not  theretofore  complied with this Article 2 shall  thereafter
look  only to AGT for the  Merger  Consideration  to  which  they  are  entitled
pursuant to this Article 2.

                  (f) No Liability.  Neither AGT nor the Company shall be liable
to any holder of Shares for any such shares of AGT Common Stock (or dividends or
distributions  with respect thereto) or cash from the Exchange Fund delivered to
a public  official  pursuant to any applicable  abandoned  property,  escheat or
similar law.

                  (g)  Withholding  Rights.  AGT or the Exchange  Agent shall be
entitled  to deduct  and  withhold,  from the  consideration  otherwise  payable
pursuant to this  Agreement to any holder of Shares,  such amounts as AGT or the
Exchange  Agent is required to deduct and withhold with respect to the making of
such payment  under the Code,  or any  provision of state,  local or foreign tax
law. To the extent that  amounts are so withheld by AGT or the  Exchange  Agent,
such  withheld  amounts  shall be treated for all purposes of this  Agreement as
having been paid to the holder of the Shares in respect of which such  deduction
and withholding was made by AGT or the Exchange Agent.

                  SECTION 2.3. Stock Options. At the Effective Time, each holder
of a then outstanding option to purchase Shares (collectively,  "Options") under
the Company's  Non-Qualified  Stock Option Plan, 1993 Non-Qualified Stock Option
Plan or 1995 Non-Qualified  Stock Option Plan  (collectively,  the "Stock Option
Plans"), whether or not then exercisable or fully vested, in settlement thereof,
shall be  entitled to receive  from the  Company for each Share  subject to such
Option  (whether  or not  then  exercisable)  an  amount  in cash  equal  to the
difference  between $60.00 and the per share  exercise price of such Option,  to
the extent  $60.00 is greater than the per share  exercise  price of such Option
and all such Options  under the Stock Option Plans shall be cancelled  and cease
to exist and the Stock Option Plans shall be terminated.


                                    ARTICLE 3

                  REPRESENTATIONS AND WARRANTIES OF THE COMPANY

                  The Company hereby  represents and warrants to each of AGT and
Acquisition as follows:

                  SECTION 3.1.  Organization and Qualification.

                  (a) The  Company and each of its  subsidiaries  (as defined in
Section 3.1(b)) is a corporation  duly organized,  validly  existing and in good
standing under the laws of the jurisdiction of its incorporation or organization
and has all requisite  corporate  power and authority to own,  lease and operate
its  properties and to carry on its  businesses as now being  conducted,  except
where the failure to be so  organized,  existing and in good standing or to have
such power and authority would not have or constitute a Material  Adverse Effect
(as defined below) on the Company.

                  When used in any clause of this  Agreement in connection  with
any party  hereto,  the term  "Material  Adverse  Effect"  means (i) a  material
adverse  effect,  or any  development  that is reasonably  likely to result in a
material  adverse  effect,  on the business,  financial  condition or results of
operations of such party and its subsidiaries, taken as whole, or (ii) an event,
change,  effect or development that is reasonably likely to materially impair or
materially  delay the  ability  of such  party to  consummate  the  transactions
contemplated hereby.

                  (b)  Except as set forth in Section  3.1(b) of the  Disclosure
Schedule  previously  delivered by the Company to AGT (the  "Company  Disclosure
Schedule"),  the  Company  has no  subsidiaries  and does not own,  directly  or
indirectly,  beneficially  or of record,  any  shares of capital  stock or other
security of any other entity or any other  investment in any other  entity.  The
term  "subsidiary"  shall mean,  when used with  reference  to any party to this
Agreement,  any entity more than fifty percent  (50%) of either the  outstanding
voting securities or the value of the outstanding equity securities or interests
(including  membership  interests) of which are owned  directly or indirectly by
such party.

                  (c) The Company and each of its subsidiaries is duly qualified
or licensed and in good  standing to do business in each  jurisdiction  in which
the  property  owned,  leased or  operated  by it or the nature of the  business
conducted by it makes such qualification or licensing necessary,  except in such
jurisdictions  where the failure to be so duly qualified or licensed and in good
standing would not have or constitute a Material Adverse Effect on the Company.

                  (d) The Company has  heretofore  delivered to AGT accurate and
complete copies of the certificate of incorporation and by-laws, as currently in
effect, of the Company and each of its subsidiaries.

                SECTION 3.2. Capitalization of the Company and its Subsidiaries.

                  (a) The authorized  capital stock of the Company  consists of:
(i)  30,000,000  shares of Company  Common Stock,  of which,  as of December 31,
1997,  7,358,817  shares were issued and outstanding  and 1,099,500  shares were
held in treasury and (ii) 5,000,000  shares of Preferred  Stock,  par value $.01
per share,  24,060  shares of Redeemable  Preferred  Stock - Series A, par value
$1.00 per share and 21,940 shares of Redeemable  Preferred Stock - Series B, par
value $1.00 per share,  no shares of which were issued and  outstanding.  All of
the issued and  outstanding  shares of Company  Common  Stock have been  validly
issued,  and are fully paid,  nonassessable and free of preemptive rights. As of
December  31, 1997,  842,500  shares of Company  Common Stock were  reserved for
issuance  and issuable  upon or otherwise  deliverable  in  connection  with the
exercise of outstanding Options issued pursuant to the Stock Option Plans. Since
December 31, 1997,  no shares of the  Company's  capital  stock have been issued
other than pursuant to the exercise of Options already in existence on such date
and, since December 31, 1997, no stock options have been granted.  Except as set
forth above in this Section 3.2(a), as of the date hereof, there are outstanding
(i) no shares of capital stock or other voting  securities of the Company,  (ii)
no  securities  of  the  Company  or  its   subsidiaries   convertible  into  or
exchangeable  for shares of capital  stock or voting  securities of the Company,
(iii)  no  options  or  other   rights  to  acquire  from  the  Company  or  its
subsidiaries,  and no obligations of the Company or its  subsidiaries  to issue,
any  capital  stock,  voting  securities  or  securities   convertible  into  or
exchangeable for capital stock or voting securities of the Company,  and (iv) no
equity equivalents, interests in the ownership or earnings of the Company or its
subsidiaries  or other similar  rights  (including  stock  appreciation  rights)
(collectively,  "Company Securities").  There are no outstanding  obligations of
the Company or its subsidiaries to repurchase,  redeem or otherwise  acquire any
Company  Securities.  Except  as set  forth in  Section  3.2(a)  of the  Company
Disclosure  Schedule and except as contemplated by this Agreement,  there are no
stockholder  agreements,  voting trusts or other agreements or understandings to
which the  Company is a party or to which it is bound  relating to the voting of
any shares of capital stock of the Company.

                  (b)  Except as set  forth in  Section  3.2(b)  of the  Company
Disclosure  Schedule,  all of the  outstanding  capital  stock of the  Company's
subsidiaries is owned by the Company, directly or indirectly,  free and clear of
any Lien (as defined below) or any other  limitation or  restriction  (including
any restriction on the right to vote or sell the same, except as may be provided
as a matter of law).  There are no securities of the Company or its subsidiaries
convertible into or exchangeable for, no options or other rights to acquire from
the  Company  or  its  subsidiaries,  and  no  other  contract,   understanding,
arrangement or obligation (whether or not contingent) providing for the issuance
or sale,  directly  or  indirectly  of,  any  capital  stock or other  ownership
interests in, or any other  securities of, any subsidiary of the Company.  There
are no outstanding contractual obligations of the Company or its subsidiaries to
repurchase,  redeem or otherwise acquire any outstanding shares of capital stock
or other ownership  interests in any subsidiary of the Company.  For purposes of
this  Agreement,  "Lien" means,  with respect to any asset  (including,  without
limitation,  any security) any mortgage, lien, pledge, charge, security interest
or encumbrance of any kind in respect of such asset.

                  SECTION 3.3. Authority Relative to this Agreement.

                  (a)  The  Company  has  all  necessary   corporate  power  and
authority  to  execute  and  deliver  this   Agreement  and  to  consummate  the
transactions  contemplated  hereby. The execution and delivery of this Agreement
and the consummation of the transactions  contemplated hereby have been duly and
validly  authorized  by the Board of  Directors  of the  Company  (the  "Company
Board")  and no  other  corporate  proceedings  on the part of the  Company  are
necessary  to  authorize  this  Agreement  or  to  consummate  the  transactions
contemplated  hereby (other than,  with respect to the Merger,  the approval and
adoption of this Agreement by the holders of a majority of the then  outstanding
shares of  Company  Common  Stock).  This  Agreement  has been duly and  validly
executed and delivered by the Company and constitutes a valid, legal and binding
agreement of the Company, enforceable against the Company in accordance with its
terms,  subject to applicable  bankruptcy,  insolvency,  fraudulent  conveyance,
reorganization,  moratorium  and similar laws  affecting  creditors'  rights and
remedies generally, and subject, as to enforceability,  to general principles of
equity, including principles of commercial  reasonableness,  good faith and fair
dealing  (regardless of whether  enforcement is sought in a proceeding at law or
in equity).

                  (b) The Company Board has, by unanimous vote of those present,
duly and validly approved,  and taken all corporate actions required to be taken
by the Company  Board for the  consummation  of, the  transactions  contemplated
hereby, including the Merger, and resolved to recommend that the stockholders of
the Company approve and adopt this Agreement. The action of the Company Board in
approving this Agreement and the transactions contemplated hereby, including the
Merger,  is sufficient to render  inapplicable  to the Merger and this Agreement
the  provisions of Section 203 of the DGCL and, to the knowledge of the Company,
no Delaware or other State  takeover  statute or similar  statute or  regulation
applies to the Merger,  this Agreement or any of the  transactions  contemplated
hereby.

                  SECTION 3.4.  SEC Reports; Financial Statements.

                  (a) The  Company  has filed all  required  forms,  reports and
documents with the Securities and Exchange Commission (the "SEC") since April 1,
1995,  each of which has complied in all material  respects with all  applicable
requirements  of the Securities Act and the Securities  Exchange Act of 1934, as
amended (the "Exchange Act"), each as in effect on the dates such forms, reports
and documents were filed.  The Company has  heretofore  delivered to AGT, in the
form filed  with the SEC  (including  any  amendments  thereto),  (i) its Annual
Reports on Form 10-K for each of the fiscal years ended March 31, 1997 and March
31,  1996,  (ii) all  definitive  proxy  statements  relating  to the  Company's
meetings of  stockholders  (whether  annual or special) held since April 1, 1995
and (iii) all other reports or registration statements filed by the Company with
the SEC since April 1, 1995 (the  "Company  SEC  Reports").  None of such forms,
reports or documents, including, without limitation, any financial statements or
schedules included or incorporated by reference therein,  contained, when filed,
any  untrue  statement  of a material  fact or omitted to state a material  fact
required to be stated or incorporated by reference therein or necessary in order
to make the statements  therein,  in light of the circumstances under which they
were made, not misleading.  The consolidated financial statements of the Company
included in the Company SEC Reports complied as to form in all material respects
with applicable accounting  requirements and the published rules and regulations
of the SEC with respect thereto and fairly presented,  in conformity with United
States generally accepted accounting principles ("GAAP") applied on a consistent
basis  (except  as may be  indicated  in the notes  thereto),  the  consolidated
financial  position of the Company and its  consolidated  subsidiaries as of the
dates  thereof  and their  consolidated  results of  operations  and  changes in
financial  position  for the  periods  then ended  (subject,  in the case of the
unaudited interim financial statements,  to normal year-end adjustments).  Since
April 1, 1997,  except as set forth in the  Company SEC  Reports,  there has not
been any change, or any application or request for any change, by the Company or
any of its  subsidiaries  in  accounting  principles,  methods or  policies  for
financial  accounting  or tax purposes  (subject,  in the case of the  unaudited
interim financial statements, to normal year-end adjustments).

                  (b)  The  Company  has  heretofore  made  available  to  AGT a
complete and correct copy of any material  amendments  or  modifications,  which
have  not yet  been  filed  with  the SEC,  to  agreements,  documents  or other
instruments which previously had been filed by the Company with the SEC pursuant
to the Exchange Act.

                  SECTION 3.5.  Information  Supplied.  None of the  information
supplied  or to  be  supplied  by  the  Company  in  writing  for  inclusion  or
incorporation by reference in (i) the  registration  statement on Form S-4 to be
filed  with the SEC by AGT in  connection  with the  issuance  of  shares of AGT
Common Stock in the Merger (the "S-4")  will,  at the time the S-4 is filed with
the SEC and at the time it becomes  effective under the Securities Act,  contain
any untrue  statement  of a  material  fact or omit to state any  material  fact
required to be stated  therein or necessary to make the  statements  therein not
misleading  and  (ii)  the  proxy  statement  relating  to the  meetings  of the
Company's  stockholders and AGT's stockholders to be held in connection with the
Merger (the "Joint Proxy Statement") will, at the date mailed to stockholders of
the Company  and AGT and at the times of the  meetings  of  stockholders  of the
Company and AGT to be held in  connection  with the  Merger,  contain any untrue
statement of a material  fact or omit to state any material  fact required to be
stated therein or necessary in order to make the statements therein, in light of
the  circumstances  under which they are made,  not  misleading.  If at any time
prior to the Effective Time, any event with respect to the Company, its officers
and  directors or any of its  subsidiaries  should occur which is required to be
described  in an amendment  of, or a  supplement  to, the S-4 or the Joint Proxy
Statement,  the Company shall  promptly so advise AGT and such event shall be so
described,  and such  amendment or  supplement  (which AGT and the Company shall
have a reasonable  opportunity  to review) shall be promptly  filed with the SEC
and, as required by law,  disseminated to the  stockholders of the Company.  The
Joint Proxy  Statement,  insofar as it relates to the  meeting of the  Company's
stockholders  to vote on the  Merger,  will  comply  as to form in all  material
respects with the  provisions of the Exchange Act and the rules and  regulations
thereunder.

                  SECTION 3.6. Consents and Approvals; No Violations. Except for
filings,  permits,  authorizations,  consents  and  approvals as may be required
under,  and other  applicable  requirements of, the Securities Act, the Exchange
Act,  state  securities  or  blue  sky  laws,  the  Hart-Scott-Rodino  Antitrust
Improvements Act of 1976, as amended (the "HSR Act"), the filing and recordation
of the  Certificate of Merger as required by the DGCL and as otherwise set forth
in Section 3.6 to the Company Disclosure Schedule,  no filing with or notice to,
and no permit,  authorization,  consent or approval of, any court or tribunal or
administrative,   governmental  or  regulatory  body,  agency  or  authority  (a
"Governmental  Entity")  is  necessary  for the  execution  and  delivery by the
Company of this Agreement or the consummation by the Company of the transactions
contemplated   hereby,   except  where  the  failure  to  obtain  such  permits,
authorizations,  consents  or  approvals  or to make such  filings  or give such
notice would not have a Material  Adverse  Effect on the Company.  Except as set
forth in Section 3.6 to the Company Disclosure Schedule,  neither the execution,
delivery and  performance of this Agreement by the Company nor the  consummation
by the Company of the transactions contemplated hereby will (i) conflict with or
result in any breach of any provision of the respective  certificate or articles
of  incorporation or bylaws (or similar  governing  documents) of the Company or
any of its subsidiaries,  (ii) result in a violation or breach of, or constitute
(with or without due notice or lapse of time or both) a default (or give rise to
any right of  termination,  amendment,  cancellation  or  acceleration  or Lien)
under, any of the terms,  conditions or provisions of any note, bond,  mortgage,
indenture, lease, license, contract, agreement or other instrument or obligation
to which the  Company or any of its  subsidiaries  is a party or by which any of
them or any of their  respective  properties  or assets  may be bound,  or (iii)
violate any order, writ,  injunction,  decree, law, statute,  rule or regulation
applicable to the Company or any of its  subsidiaries or any of their respective
properties  or assets,  except in the case of (ii) for  violations,  breaches or
defaults which would not have a Material Adverse Effect on the Company.

                  SECTION   3.7.  No  Default.   None  of  the  Company  or  its
subsidiaries is in default or violation (and no event has occurred which with or
without  due notice or the lapse of time or both would  constitute  a default or
violation)  of any  term,  condition  or  provision  of (i) its  certificate  or
articles of incorporation or bylaws (or similar governing  documents),  (ii) any
note, bond, mortgage,  indenture,  lease, license, contract,  agreement or other
instrument or obligation to which the Company or any of its  subsidiaries is now
a party or by which any of them or any of their respective  properties or assets
may be bound or (iii) any order, writ, injunction, decree, law, statute, rule or
regulation  applicable  to  the  Company,  its  subsidiaries  or  any  of  their
respective  properties  or  assets,  except  in the  case of (ii) or  (iii)  for
violations,  breaches or defaults  which would not have or constitute a Material
Adverse Effect on the Company.

                  SECTION 3.8. No Undisclosed  Liabilities;  Absence of Changes.
Except as and to the extent publicly disclosed by the Company in the Company SEC
Reports filed prior to the date of this Agreement or disclosed in Section 3.8 of
the Company  Disclosure  Schedule,  since April 1, 1997, (a) neither the Company
nor its  subsidiaries has incurred any liabilities or obligations of any nature,
whether or not accrued,  contingent or  otherwise,  and whether due or to become
due or  asserted or  unasserted,  which in the  aggregate  would have a Material
Adverse  Effect  on the  Company,  (b)  the  business  of the  Company  and  its
subsidiaries  has been carried on only in the ordinary  course  consistent  with
past  practices,  (c) the Company has not paid any dividend or  distribution  in
respect of, or redeemed or repurchased  any Company  Securities,  (d) other than
consistent with past practices,  the Company has not entered into or consummated
any  transaction  with any officer,  director or affiliate of the Company or any
person  known  by the  Company  to be an  affiliate  of any of them  and (e) the
Company has not changed its methods of accounting.

                  SECTION 3.9.  Litigation.  Except as publicly disclosed by the
Company in the Company SEC  Reports or  disclosed  in Section 3.9 of the Company
Disclosure   Schedule,   there  is  no  suit,  claim,   action,   proceeding  or
investigation  pending or, to the knowledge of the Company,  threatened  against
the Company or any of its subsidiaries or any of their respective  properties or
assets which (a) individually or in the aggregate, would have a Material Adverse
Effect on the Company or (b)  questions  the  validity of this  Agreement or any
action to be taken by the Company in  connection  with the  consummation  of the
transactions  contemplated hereby or could otherwise prevent or materially delay
the consummation of the transactions  contemplated by this Agreement.  Except as
publicly  disclosed  by the  Company in the  Company  SEC  Reports,  none of the
Company  or  its  subsidiaries  is  subject  to  any  outstanding  order,  writ,
injunction or decree which would have a Material Adverse Effect on the Company.

                  SECTION  3.10.  Compliance  with  Applicable  Law.  Except  as
publicly  disclosed by the Company in the Company SEC  Reports,  the Company and
its subsidiaries hold all permits, licenses,  variances,  exemptions, orders and
approvals of all Governmental Entities necessary for the lawful conduct of their
respective businesses (the "Company Permits"),  except for failures to hold such
permits, licenses,  variances,  exemptions, orders and approvals which would not
have a Material Adverse Effect on the Company.  Except as publicly  disclosed by
the Company in the Company SEC Reports,  the Company and its subsidiaries are in
compliance with the terms of the Company Permits, except where the failure so to
comply  would  not have a  Material  Adverse  Effect on the  Company.  Except as
publicly disclosed by the Company in the Company SEC Reports,  the businesses of
the Company and its  subsidiaries  are not being  conducted  in violation of any
law,  ordinance  or  regulation  of  any  Governmental  Entity  except  that  no
representation  or  warranty  is made in  this  Section  3.10  with  respect  to
Environmental  Laws (as defined and addressed in Section 3.12(a)) and except for
violations or possible violations which would not have a Material Adverse Effect
on the Company.  Except as publicly  disclosed by the Company in the Company SEC
Reports or as disclosed in Section 3.10 of the Company Disclosure  Schedule,  no
investigation or review by any  Governmental  Entity with respect to the Company
or its subsidiaries is pending or, to the knowledge of the Company,  threatened,
nor, to the knowledge of the Company,  has any Governmental  Entity indicated an
intention to conduct the same,  other than,  in each case,  those the outcome of
which would not have a Material Adverse Effect on the Company.

                  SECTION 3.11.  Employee Plans.

                  (a) Section 3.11(a) of the Company  Disclosure  Schedule lists
all  "employee  benefit  plans,"  as defined  in  Section  3(3) of the  Employee
Retirement  Income  Security Act of 1974,  as amended  ("ERISA"),  and all other
employee  benefit  plans  or other  benefit  arrangements,  including  executive
compensation,   directors'  benefit,  bonus  or  other  incentive  compensation,
severance and deferred compensation plans and practices which the Company or any
of its  subsidiaries  maintains,  is a  party  to,  contributes  to or  has  any
obligation to or liability for (each a "Company Benefit Plan" and  collectively,
the "Company Benefit Plans").

                  (b) True,  correct and complete copies or descriptions of each
Company  Benefit  Plan (and,  where  applicable,  the most recent  summary  plan
description,  actuarial report,  determination letter, most recent Form 5500 and
trust agreement) have been delivered to AGT for review prior to the date hereof.

                  (c) As of the date  hereof,  except as  disclosed  on  Section
3.11(c) of the Company Disclosure  Schedule,  (i) all material payments required
to be made by or under any Company  Benefit  Plan,  any related  trusts,  or any
collective  bargaining  agreement  have  been  made;  (ii) the  Company  and its
subsidiaries have performed all material obligations required to be performed by
them under any Company  Benefit Plan;  (iii) the Company Benefit Plans have been
administered  in material  compliance  with their terms and the  requirements of
ERISA,  the Code and other  applicable  laws; (iv) there are no actions,  suits,
arbitrations  or claims (other than routine  claims for benefit)  pending or, to
the  knowledge of the Company,  threatened  with respect to any Company  Benefit
Plan; and (v) the Company and its subsidiaries  have no liability as a result of
any  "prohibited  transaction"  (as  defined in Section 406 of ERISA and Section
4975 of the Code) for any excise tax or civil penalty.

                  (d)      Except as disclosed on Section 3.11(d) of the Company
            Disclosure Schedule, none of the Company Benefit Plans is subject to
Title IV of ERISA.

                  (e)  Except as set forth on  Section  3.11(e)  of the  Company
Disclosure  Schedule,  the Company and its  subsidiaries  have not  incurred any
unsatisfied  withdrawal  liability  with  respect to any  multiemployer  plan as
defined in Section 4001(a)(3) of ERISA.

                  (f) Section  3.11(f) of the Company  Disclosure  Schedule sets
forth a list of all  "employee  pension  plans," as  defined on Section  3(2) of
ERISA,  maintained  by the  Company or any of its  subsidiaries  on any trade or
business  (whether or not  incorporated)  which are under control,  or which are
treated as a single employer, with the Company under Section 414(b), (c), (m) or
(o)  of  the  Code  (an  "ERISA  Affiliate"),  or  to  which  the  Company,  its
Subsidiaries  or any ERISA  Affiliate  contributed or is obligated to contribute
thereunder ("Company Pension Plans").  Except as set forth on Section 3.11(f) of
the Company Disclosure Schedule,  each of the Pension Plans which is intended to
be "qualified"  within the meaning of Section 401(a) and 401(k),  if applicable,
and 501(a) of the Code has been determined by the Internal Revenue Service to be
so  "qualified"  and, to the  knowledge of the  Company,  there is no fact which
would adversely affect the qualified status of any such Company Pension Plan.

                  (g)  Except as set forth on  Section  3.11(g)  of the  Company
Disclosure  Schedule,  neither the execution and delivery of this  Agreement nor
the consummation of the transactions  contemplated hereby will (i) result in any
payment becoming due, or increase the amount of compensation due, to any current
or former employee of the Company or any of its subsidiaries;  (ii) increase any
benefits  otherwise  payable under any Company  Benefit Plan; or (iii) result in
the acceleration of the time of payment or vesting of any such benefits.

                  (h) If and to the extent  applicable,  no Company Benefit Plan
has or has  incurred an  accumulated  funding  deficiency  within the meaning of
Section  302 of ERISA or  Section  412 of the  Code,  nor has any  waiver of the
minimum  funding  standards  of Section 302 of ERISA and Section 412 of the Code
been  requested  of or granted by the IRS with  respect to any  Company  Benefit
Plan,  nor has any lien in favor of any such plan arisen under Section 412(n) of
the Code or Section 302(f) of ERISA.  Except as indicated on Schedule 3.11(h) of
the Company Disclosure  Schedule,  no Company Benefit Plan is self funded by the
Company.  Except as  disclosed  on Schedule  3.11(h) of the  Company  Disclosure
Schedule,  with respect to any insurance policy  providing  funding for benefits
under any Company  Benefit  Plan,  there is no  liability  of the Company in the
nature of a retroactive  rate  adjustment,  loss sharing  arrangement,  or other
actual or  contingent  liability,  and there will be no such  liability  arising
wholly or  partially  out of events  occurring  prior to the  execution  of this
Agreement,  nor would there be any such liability if the Company  cancelled such
policy as of the date hereof.

            SECTION 3.12. Environmental Matters. (a) As used in this Agreement:

                  (1) "Environmental Law" means any applicable federal, state or
local  law,  statute,  code,  ordinance,   policy,  rule,  regulation  or  other
governmental  requirement from any U.S. or foreign  jurisdiction  concerning the
Release (as defined herein), handling,  storage,  processing,  transportation or
other  use of any solid  waste,  industrial  waste or  Hazardous  Substance  (as
defined  herein)  including,   by  way  of  example  but  not  limitation,   the
Comprehensive Environmental Response,  Compensation and Liability Act (43 U.S.C.
ss. 9601 et seq.),  the Hazardous  Materials  Transportation  Act (49 U.S.C. ss.
1801 et seq.), the Resource Conservation and Recovery Act (42 U.S.C. ss. 6901 et
seq.),  the Clean Water Act (33 U.S.C.  ss. 1251 et seq.), the Clean Air Act (33
U.S.C. ss. 2601 et seq.),  the Toxic Substances  Control Act (15 U.S.C. ss. 2601
et seq.), the Federal  Insecticide,  Fungicide and Rodenticide Act (7 U.S.C. ss.
136 et seq.) and the  Occupational  Safety and Health Act (29 U.S.C.  ss. 651 et
seq.), as such laws have been amended, and the regulations  promulgated pursuant
thereto,  and any  applicable  and  analogous  state or local  statutes,  codes,
policies  or  related   requirements   of   governmental   entities  of  foreign
jurisdictions.

                  (2)  "Environmental  Claim"  means any  allegation,  notice of
violation,  action, claim, lien, demand, order,  injunction,  judgment,  decree,
ruling,  assessment or arbitration award or directive (conditional or otherwise)
by any court,  arbitrator  or  governmental  entity or any  person for  personal
injury (including sickness,  disease or death),  tangible or intangible property
damage,  diminution in value,  damage to the  environment or natural  resources,
nuisance, pollution,  contamination or other adverse effects on the environment,
or for fines,  penalties or  restrictions  resulting  from or based upon (a) the
existence,  or the  continuation  of the  existence,  of a  Release  (including,
without limitation,  sudden or non-sudden accidental or non-accidental  Release)
of, or exposure to, any Hazardous Substance, odor, audible noise or any solid or
industrial  waste;  (b) the  transportation,  storage,  treatment or disposal of
solid waste,  industrial waste or Hazardous  Substances,  in connection with the
past or present  operations of the Company,  any of its  subsidiaries  or any of
their  respective  predecessors  or assigns;  or (c) the  violation,  or alleged
violation, of any Environmental Laws, orders, injunctions,  judgments,  decrees,
rulings,  assessments,  arbitration  awards,  Environmental  Permits or rulings,
orders or decisions of any court  arbitrator  or Government  Entity  relating to
environmental matters.

                  (3)  "Environmental   Permit"  means  any  permit,   approval,
authorization,    license,   variance,    registration,    permit   application,
notification,  program  development and  implementation,  or permission required
under any applicable Environmental Law.

                  (4) "Hazardous  Substance"  means any  substance,  material or
waste  which is  regulated  under  any  Environmental  Law or by any  applicable
governmental  entity,  governmental  entity  in the  jurisdictions  in which the
Company or any  subsidiary or any of their  respective  predecessors  or assigns
conducts or has conducted  business,  or the United States,  including,  without
limitation,  any material or substance which is defined as a "hazardous  waste,"
"hazardous  material,"  "hazardous  substance,"  "extremely  hazardous waste" or
"restricted  hazardous  waste," "subject waste,"  "contaminant,"  "toxic waste,"
"toxic substance" or "residual waste'" under any Environmental  Law,  including,
but not limited to,  radioactive  materials,  petroleum  products,  asbestos and
polychlorinated biphenyls.

                  (5)  "Property"   means  any  land,   facility  or  operations
currently or  previously  owned,  leased,  subleased  or  otherwise  used by the
Company,  any of its  subsidiaries  or any of their  respective  predecessors or
assigns.

                  (6)  "Release"   means  any   intentional  or   unintentional,
continuous or intermittent release, spill, emission,  seepage, leaking, pumping,
uncontrolled loss, injection, deposit, disposal, discharge,  dispersal, leaching
or migration into the environment,  or any building surface, or onto or from any
Property of any  Hazardous  Substance,  including  the movement of any Hazardous
Substance through or in the air, soil, surface water, ground water or otherwise.

                  (7) "Remedial  Action" means all actions,  including,  without
limitation, any capital expenditures,  required or voluntarily undertaken to (i)
clean up, remove,  treat, or in any other way address any Hazardous Substance or
any other  material  required  pursuant to  applicable  Environmental  Law; (ii)
prevent the Release or threat of Release, or minimize the further Release of any
Hazardous  Substance  or any other  material  required  pursuant  to  applicable
Environmental  Law, (iii) perform  pre-remedial  studies and  investigations  or
post-remedial  monitoring and care including the conduct of risk assessments and
negotiation with applicable  governmental entities regarding Hazardous Substance
or any other material required pursuant to applicable Environmental Law; or (iv)
bring the Properties into compliance with all applicable  Environmental Laws and
Environmental Permits.

                  (b)  Except as  disclosed  in Section  3.12(b) of the  Company
Disclosure Schedule,  the Company and each of its subsidiaries,  with respect to
its use of and  operations  at each  Property,  is in compliance in all respects
with all  applicable  Environmental  Laws,  except where the failure to so be in
compliance would not, individually or in the aggregate,  have a Material Adverse
Effect on the Company.

                  (c)  Except as  disclosed  in Section  3.12(c) of the  Company
Disclosure  Schedule or as disclosed in any Company SEC document  filed with the
SEC prior to the date hereof, as of the date hereof, neither the Company nor any
of its  subsidiaries or any of their  respective  predecessors  has received any
written  communication  form a court,  arbitrator or governmental  entity or any
other person that alleges that the Company or any such subsidiary or predecessor
is  not in  compliance,  in  any  respect,  with  any  Environmental  Law or has
liability   thereunder,   except,  in  each  case  it  is  reasonably  unlikely,
individually  or in the  aggregate,  to have a  Material  Adverse  Effect on the
Company.

                  (d)  Except as  disclosed  in Section  3.12(d) of the  Company
Disclosure Schedule,  none of the operations or Properties of the Company or any
of its  subsidiaries or any of their  respective  predecessors or assigns is the
subject of investigation by any governmental  entity whether U.S., State,  local
or foreign,  respecting (A)  Environmental  Laws, (B) Remedial Action or (C) any
Environmental  Claim  arising  from a  Release  or  otherwise  of any  Hazardous
Substance or any other substance regulated under any Environmental Law, which in
each case  would,  individually  or in the  aggregate,  have a Material  Adverse
Effect on the Company.

                  (e)  Except as  disclosed  in Section  3.12(e) of the  Company
Disclosure  Schedule,  the Company,  each of its  subsidiaries  and any of their
respective  predecessors  have filed all notices  required to be filed under all
Environmental  Laws  reporting  any Release,  except where  failure to file such
notices would not,  individually  or in the aggregate,  have a Material  Adverse
Effect on the Company.

                  (f)  Except as  disclosed  in Section  3.12(f) of the  Company
Disclosure  Schedule,  or as  disclosed  in any Company SEC Report,  neither the
Company nor any of its subsidiaries has any contingent  liabilities with respect
to its business or that of its  predecessors  in  connection  with any Hazardous
Substance or  Environmental  Law that would,  individually  or in the aggregate,
have a Material Adverse Effect on the Company.

                  (g)  Except as  disclosed  in Section  3.12(g) of the  Company
Disclosure  Schedule,  or as disclosed in any Company SEC Report, as of the date
hereof,  underground  storage tanks are not located on or under any Property and
there have been no Releases of Hazardous Substances on, in or under any Property
or other real property for which the Company or any of its subsidiaries would be
responsible or potentially  responsible  and that would have a Material  Adverse
Effect on the Company.

                  (h)  Except as  disclosed  in Section  3.12(h) of the  Company
Disclosure  Schedule,  or as  disclosed in any Company SEC Report filed with the
SEC prior to the date hereof, neither the Company nor any of its subsidiaries or
any of their respective predecessors is subject to any judicial,  administrative
or arbitral actions, suits,  proceedings (public or private),  written claims or
governmental  proceedings  alleging the  violation of any  Environmental  Law or
Environmental  Permit  that  is  reasonably  likely,   individually  or  in  the
aggregate, to have a Material Adverse Effect on the Company.

                  (i)  Except as  disclosed  in Section  3.12(i) of the  Company
Disclosure Schedule,  or as disclosed in any Company SEC Document filed with the
SEC prior to the date hereof, neither the Company nor any of its subsidiaries or
any of their respective predecessors or assigns, as a result of their respective
past and current operations, has caused or permitted any Hazardous Substances to
remain  or be  disposed  of,  either  on or under  any  Property  or on any real
property not permitted to accept, store or dispose of such Hazardous Substances,
that would,  individually or in the aggregate, have a Material Adverse Effect on
the Company.

                  SECTION 3.13. Tax Matters. Except as disclosed on Section 3.13
of the Company Disclosure Schedule:

                  (a)  The  Company  and  each  of its  subsidiaries,  and  each
affiliated  group  (within the meaning of Section 1504 of the Code) of which the
Company or any of its subsidiaries is or has ever been a member, has (or, by the
Closing Date,  will have) timely filed with the appropriate  taxing  authorities
all federal  income tax returns and all other  material  tax returns and reports
required to be filed by it through the  Closing  Date.  All such tax returns are
(or will be) complete and correct in all material respects. Except to the extent
adequately  reserved for in  accordance  with GAAP,  the Company and each of its
subsidiaries  has (or, by the Closing Date,  will have) paid (or the Company has
paid on its  subsidiaries'  behalf)  all taxes  due in  respect  of the  taxable
periods  covered by such tax  returns.  The most recent  consolidated  financial
statements  contained in the Company SEC Reports reflect an adequate  reserve in
accordance  with GAAP for all taxes payable by the Company and its  subsidiaries
for all taxable periods and portions  thereof through the date of such financial
statements. The Company has previously made available or delivered to AGT copies
of all income and  franchise  tax  returns  filed by the Company and each of its
subsidiaries  for their taxable years ended in 1995, 1996 and 1997. For purposes
of this  Agreement,  "tax" or  "taxes"  shall  mean all  taxes,  charges,  fees,
imposts, levies, gaming or other assessments, including, without limitation, all
net income,  gross  receipts,  capital,  sales,  use, ad valorem,  value  added,
transfer,  franchise,  profits, inventory, capital stock, license,  withholding,
payroll, employment,  social security,  unemployment,  excise, severance, stamp,
occupation,  property and estimated taxes, customs duties, fees, assessments and
charges of any kind  whatsoever,  together with any interest and any  penalties,
fines,  additions to tax or additional  amounts imposed by any taxing  authority
(domestic or foreign) and shall include any joint and/or transferee liability in
respect of taxes or any liability in respect of taxes  imposed by contract,  tax
sharing  agreement,  tax  indemnity  agreement  or any similar  agreement.  "Tax
returns"  shall mean any  report,  return,  document,  declaration  or any other
information  or filing  required  to be  supplied  to any  taxing  authority  or
jurisdiction  (foreign or domestic)  with respect to taxes,  including,  without
limitation,  information  returns,  any document with respect to or accompanying
payments or estimated taxes, or with respect to or accompanying requests for the
extension of time in which to file any such report, return document, declaration
or other information.

                  (b) No material deficiencies for any taxes have been proposed,
asserted or assessed  against the Company or any of its  subsidiaries  that have
not been fully paid or  adequately  provided  for in the  appropriate  financial
statements  of the Company and its  subsidiaries,  no State where the Company or
one of its  subsidiaries  does not file an income or  franchise  tax  return has
asserted in writing during the preceding five years that such corporation should
be so  filing,  no  requests  for  waivers  of the time to assess  any taxes are
pending, and no power of attorney with respect to any taxes has been executed or
filed with any taxing authority.  No material issues relating to taxes have been
raised in writing by the relevant taxing authority during any presently  pending
audit or examination.  The federal income tax returns of the Company and each of
its  subsidiaries  consolidated in such tax returns have been reviewed or passed
upon by the Internal Revenue Service for all years through March 31, 1994.

                  (c) No  material  Liens for taxes  exist  with  respect to any
assets or  properties  of the  Company  or any of its  subsidiaries,  except for
statutory liens for taxes not yet due.

                  (d) None of the Company or any of its  subsidiaries is a party
to or is bound by any tax sharing agreement, tax indemnity obligation or similar
agreement,  arrangement or practice with respect to taxes (including any advance
pricing  agreement,  closing agreement or other agreement relating to taxes with
any taxing  authority)  (other  than any such tax  sharing  agreement  among the
Company  and its  subsidiaries  as set forth in Section  3.13(d) of the  Company
Disclosure Schedule).

                  (e) None of the Company or any of its  subsidiaries has taken,
agreed to take or will take any  action  that  would  prevent  the  Merger  from
constituting a reorganization  qualifying under the provisions of Section 368(a)
of the Code.

                  (f) Neither the Company nor any of its  subsidiaries has made,
will make,  is  obligated  to make or is party to any  employment,  severance or
termination  agreement,  other compensation  arrangement or Company Benefit Plan
currently  in effect which  provides  for the making of any payment  (whether in
cash or property or the vesting of  property)  that would not be  deductible  by
reason of Sections 280G or 162(m) of the Code.

                  (g) The  Company  and its  subsidiaries  have  complied in all
material  respects with all applicable laws,  rules and regulations  relating to
the payment and withholding of taxes.

                  (h) No  federal,  state,  local  or  foreign  audits  or other
administrative  proceedings  or  court  proceedings  are  presently  pending  or
threatened in writing with regard to any federal income or material state, local
or foreign taxes or tax returns of the Company or its  subsidiaries  and neither
the Company nor any of its  subsidiaries  has  received a written  notice of any
pending audit or proceeding.

                  (i) Neither the Company nor any of its subsidiaries has agreed
to or is required to make any adjustment under Section 481(a) of the Code.

                  (j) Neither the  Company nor any of its  subsidiaries  has (i)
with regard to any assets or property  held or acquired by any of them,  filed a
consent  to the  application  of  Section  341(f)  of the Code 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
or any of its  subsidiaries,  (ii) executed or entered into a closing  agreement
pursuant to Section 7121 of the Code or any similar provision of state, local or
foreign  law  or  (iii)   received  or  filed  any   requests   for  rulings  or
determinations in respect of any taxes within the last five years.

                  (k)  No   property   owned  by  the  Company  or  any  of  its
subsidiaries  (i) is  property  required to be treated as being owned by another
Person pursuant to the provisions of Section  168(f)(8) of the Internal  Revenue
Code of 1954, as amended and in effect immediately prior to the enactment of the
Tax Reform Act of 1986; (ii)  constitutes  "tax exempt use property"  within the
meaning of Section  168(h)(1) of the Code; or (iii) is "tax exempt bond financed
property" within the meaning of Section 168(g) of the Code.

                  (l)  The  Company  and  each  of  its   subsidiaries  are  not
currently,  have not been  within  the last  five  years  and do not  anticipate
becoming a "United States real property  holding  company" within the meaning of
Section 897(c) of the Code.

                  (m)  The Company is not a foreign person within the meaning of
Section 1445(b)(2) of the Code.

                  (n)  No subsidiary of the Company owns any Shares.

                  SECTION 3.14.  Intellectual Property.

                  (a)  Except  as set  forth  in  Section  3.14  of the  Company
Disclosure  Schedule,  the Company or one of its subsidiaries  owns or possesses
(and will own or possess as of the Effective Time) all right, title and interest
in and to, or a valid and  enforceable  license or other right to use all of the
Intellectual  Property (as defined  below),  and all of the right,  benefits and
privileges associated therewith, that is material to the conduct of the business
of the Company and its subsidiaries as currently  conducted (and as conducted as
of the Effective Time). To the knowledge of the Company, neither the Company nor
any of its subsidiaries has infringed, misappropriated or otherwise violated any
Intellectual  Property of any other person. To the knowledge of the Company,  no
person is materially  infringing  upon any  Intellectual  Property  right of the
Company or any of its subsidiaries.

                  (b) The term "Intellectual Property" means all patents, patent
applications and patent  disclosures;  all inventions (whether or not patentable
and whether or not reduced to practice);  all trademarks,  service marks,  trade
dress,  trade  names  and  corporate  names  and  all  the  goodwill  associated
therewith;  all mask works; all registered and unregistered statutory and common
law  copyrights;  all  registrations,  applications  and renewals for any of the
compositions,  know-how,  manufacturing and production processes and techniques,
research  information,  drawings,  specifications,  design plans,  improvements,
proposals,  technical and computer data,  documentation and software,  financial
proposals,  technical and computer data,  documentation and software,  financial
business  and  marketing   plans,   customer  and  supplier  lists  and  related
proprietary information, marketing materials and all other proprietary rights.

                  SECTION 3.15. Opinion of Financial Advisor.  Donaldson, Lufkin
& Jenrette  Securities Corp. (the "Company Financial  Advisor") has delivered to
the Company Board its opinion,  dated the date of this Agreement,  to the effect
that, as of such date, the Merger Consideration is fair to the holders of Shares
from a  financial  point of view,  and such  opinion has not been  withdrawn  or
modified.

                  SECTION 3.16. Brokers. No broker,  finder or investment banker
(other  than the Company  Financial  Advisor,  a true and correct  copy of whose
engagement  agreement  has been  provided to AGT) is entitled to any  brokerage,
finder's or other fee or commission or expense  reimbursement in connection with
the transactions  contemplated by this Agreement based upon arrangements made by
and on behalf of the Company or any of its affiliates.

                  SECTION 3.17.  Material Contracts.

                  (a) The Company has delivered or otherwise  made  available to
AGT true,  correct and complete  copies of all contracts and agreements (and all
amendments,  modifications and supplements thereto and all side letters to which
the Company is a party  affecting the  obligations  of any party  thereunder) to
which the Company or any of its  subsidiaries  is a party or by which any of its
properties or assets are bound that are material to the business,  properties or
assets of the Company and its subsidiaries taken as a whole, including,  without
limitation,  (I) contracts or agreements with any supplier or customer,  in each
case  which  could  result  in the  payment  or  receipt  of monies in excess of
$2,500,000 in any calendar year period;  (II) to the extent any of the following
are, individually or in the aggregate,  material to the business,  properties or
assets  of  the  Company  and  its  subsidiaries  taken  as a  whole,  all:  (i)
employment,  product  design  or  development,  personal  services,  consulting,
non-competition,  severance or  indemnification  contracts  (including,  without
limitation,  any contract to which the Company or any of its  subsidiaries  is a
party  involving  employees  of the  Company or any of its  subsidiaries);  (ii)
licensing,  merchandising or distribution agreements; (iii) contracts granting a
right of first refusal or first  negotiation;  (iv) partnership or joint venture
agreements; (v) agreements for the acquisition, sale, lease or other disposition
of  material  properties  or  assets  of  the  Company  or its  subsidiaries  or
predecessors  (by  merger,  purchase  or sale of assets  or stock or  otherwise)
entered  into since  April 1, 1995 and (vi)  contracts  or  agreements  with any
Governmental  Entity and (III) all  commitments and agreements to enter into any
of the  foregoing  items in (I) or (II) above  (collectively,  together with any
such  contracts  entered  into  in  accordance  with  Section  5.1  hereof,  the
"Contracts").

                  (b)  Each  of  the  Contracts  is  valid  and  enforceable  in
accordance  with  its  terms,  subject  to  applicable  bankruptcy,  insolvency,
fraudulent  conveyance,  reorganization,  moratorium  and similar laws affecting
creditors' rights and remedies generally, and subject, as to enforceability,  to
general principles of equity, including principles of commercial reasonableness,
good faith and fair dealing  (regardless  of whether  enforcement is sought in a
proceeding  at law or in equity),  and there is no default under any Contract so
listed either by the Company or, to the  knowledge of the Company,  by any other
party  thereto,  and no event  has  occurred  that with the lapse of time or the
giving of notice or both would  constitute a default  thereunder  by the Company
or, to the knowledge of the Company,  any other party, in any such case in which
such default or event would have a Material Adverse Effect on the Company.

                  (c) No party to any such  Contract  has  given  notice  to the
Company of or made a claim  against  the Company  with  respect to any breach or
default thereunder,  in any such case in which such breach or default would have
a Material Adverse Effect on the Company.

                  SECTION 3.18.  Labor  Matters.  Except as set forth in Section
3.18 of the  Company  Disclosure  Schedule,  neither  the Company nor any of its
subsidiaries is a party to or bound by any employment,  severance  compensation,
labor or  collective  bargaining  agreement  pertaining to any current or former
directors,  officers,  employees  or  consultants  of the  Company or any of its
subsidiaries.  No labor organization or group of employees of the Company or any
of its  subsidiaries  has made a  pending  written  demand  for  recognition  or
certification.

                  SECTION 3.19.  Insurance.  Except as set forth in Section 3.19
of the Company Disclosure Schedule, each of the Company and its subsidiaries is,
and has  been  continuously  since  April  1,  1996,  insured  with  financially
responsible  insurers in such  amounts and against  such risks and losses as are
customary for companies  conducting the business as conducted by the Company and
its subsidiaries during such time period. Except as set forth in Section 3.19 of
the Company  Disclosure  Schedule,  since April 1, 1996, neither the Company nor
any of its subsidiaries has received notice of cancellation or termination (or a
denial of coverage) with respect to any material insurance policy of the Company
or its subsidiaries.  The insurance policies of the Company and its subsidiaries
are valid and enforceable policies.

                  SECTION 3.20.  Customers.  Except as set forth in Section 3.20
of the  Company  Disclosure  Schedule,  no  customer  from which the Company has
received  revenues of at least  $2,500,000 in any of the past three fiscal years
has:  (a)  threatened  within the last  twelve  months to  terminate,  or to the
knowledge  of the  Company,  intends  to  cancel  or  otherwise  terminate,  the
relationship  of such person with the Company or any of its  subsidiaries or (b)
has during the last twelve months decreased  materially or threatened in writing
to  decrease  or limit  materially  its usage or  purchase  of the  services  or
products of the Company or any of its subsidiaries,  or, to the knowledge of the
Company,  intends to modify  materially its relationship with the Company or any
of its subsidiaries.


                                    ARTICLE 4

                         REPRESENTATIONS AND WARRANTIES
                             OF AGT AND ACQUISITION

                  AGT  and  Acquisition  hereby  represent  and  warrant  to the
Company as follows:

                  SECTION 4.1.  Organization and Qualification.

                  (a) AGT is a corporation duly organized,  validly existing and
in good standing  under the laws of the  jurisdiction  of its  incorporation  or
organization  and has all requisite  corporate power and authority to own, lease
and  operate  its  properties  and to  carry  on  its  businesses  as now  being
conducted,  except  where the failure to be so  organized,  existing and in good
standing or to have such power and authority  would not have a Material  Adverse
Effect on AGT.

                  (b)  Except as set forth in Section  4.1(b) of the  Disclosure
Schedule  previously  delivered  by AGT  to the  Company  (the  "AGT  Disclosure
Schedule"),  AGT has no subsidiaries  and does not own,  directly or indirectly,
beneficially or of record,  any shares of capital stock or other security of any
other entity or any other investment in any other entity.

                  (c) AGT is duly  qualified or licensed and in good standing to
do business in each jurisdiction in which the property owned, leased or operated
by it or the nature of the business  conducted by it makes such qualification or
licensing  necessary,  except in such  jurisdictions  where the failure to be so
duly  qualified or licensed and in good standing  would not have or constitute a
Material Adverse Effect on AGT.

                  (d) AGT has heretofore made available to the Company  accurate
and  complete  copies  of the  Certificates  of  Incorporation  and  Bylaws,  as
currently in effect, of AGT and Acquisition.

                  SECTION 4.2.  Capitalization of AGT and its Subsidiaries.

                  (a)  The  authorized  capital  stock  of AGT  consists  of (i)
40,000,000  shares of AGT Common  Stock,  of which,  as of  December  31,  1997,
17,836,383  shares were issued and  outstanding,  and (ii) 10,000,000  shares of
preferred  stock, no par value, no shares of which were issued and  outstanding.
All of the issued and  outstanding  shares of AGT Common Stock have been validly
issued,  and are fully paid,  nonassessable and free of preemptive rights. As of
December  31,  1997,  2,209,200  shares of AGT Common  Stock were  reserved  for
issuance  and issuable  upon or otherwise  deliverable  in  connection  with the
exercise of outstanding options.  Except as described in the AGT SEC Reports (as
defined in Section  4.4(a)) and except as set forth in Section 4.2(a) of the AGT
Disclosure  Schedule  since  December 31, 1997, no shares of AGT's capital stock
have been issued other than  pursuant to stock  options  already in existence on
such date,  and no stock options have been  granted.  Except (i) as described in
the AGT SEC Reports and (ii) as set forth above,  as of the date  hereof,  there
are  outstanding  (A) no shares of capital  stock or other voting  securities of
AGT,  (B)  no  securities  of  AGT  or  its  subsidiaries  convertible  into  or
exchangeable  for shares of capital  stock or voting  securities  of AGT, (C) no
options  or  other  rights  to  acquire  from  AGT or its  subsidiaries,  and no
obligations  of AGT or its  subsidiaries  to issue,  any capital  stock,  voting
securities or securities  convertible  into or exchangeable for capital stock or
voting  securities  of AGT,  and (D) no  equity  equivalents,  interests  in the
ownership  or  earnings  of AGT or its  subsidiaries  or  other  similar  rights
(including stock appreciation rights)  (collectively,  "AGT Securities").  There
are no outstanding  obligations of AGT or any of its subsidiaries to repurchase,
redeem or otherwise  acquire any AGT Securities.  Except as set forth in the AGT
SEC  Reports,  there  are no  stockholder  agreements,  voting  trusts  or other
agreements  or  understandings  to which  AGT is a party or to which it is bound
relating to the voting of any shares of capital stock of AGT.

                  (b) All of the outstanding capital stock of AGT's subsidiaries
(including Acquisition) is owned by AGT, directly or indirectly,  free and clear
of any Lien or any other limitation or restriction (including any restriction on
the right to vote or sell the same,  except  as may be  provided  as a matter of
law).  There are no securities of AGT or its  subsidiaries  convertible  into or
exchangeable  for,  no  options  or  other  rights  to  acquire  from AGT or its
subsidiaries,  and no other contract,  understanding,  arrangement or obligation
(whether or not  contingent)  providing  for the  issuance or sale,  directly or
indirectly,  of any capital stock or other ownership  interests in, or any other
securities  of, any  subsidiary  of AGT.  There are no  outstanding  contractual
obligations  of AGT or its  subsidiaries  to  repurchase,  redeem  or  otherwise
acquire any outstanding shares of capital stock or other ownership  interests in
any subsidiary of AGT.

                  SECTION 4.3. Authority Relative to this Agreement.

                  (a) Each of AGT and  Acquisition  has all necessary  corporate
power and authority to execute and deliver this  Agreement and to consummate the
transactions  contemplated  hereby. The execution and delivery of this Agreement
and the consummation of the transactions  contemplated hereby have been duly and
validly  authorized  by the Boards of  Directors  of AGT (the "AGT  Board")  and
Acquisition  and by AGT as the sole  stockholder  of  Acquisition,  and no other
corporate  proceedings  on the  part  of AGT or  Acquisition  are  necessary  to
authorize this Agreement or to consummate the transactions  contemplated  hereby
(other than, with respect to the issuance of AGT Common Stock as required by the
terms of this Agreement (the "Share Issuance"), the approval and adoption of the
Share  Issuance  by the  holders  of a majority  of the total  votes cast on the
approval and adoption of the Share Issuance at the meeting of AGT's stockholders
called for such purpose).  This Agreement has been duly and validly executed and
delivered by each of AGT and  Acquisition  and  constitutes  a valid,  legal and
binding  agreement of each of AGT and Acquisition,  enforceable  against each of
AGT and  Acquisition  in  accordance  with  its  terms,  subject  to  applicable
bankruptcy,  insolvency, fraudulent conveyance,  reorganization,  moratorium and
similar laws affecting creditors' rights and remedies generally, and subject, as
to  enforceability,  to general  principles of equity,  including  principles of
commercial  reasonableness,  good faith and fair dealing  (regardless of whether
enforcement is sought in a proceeding at law or in equity).

                  (b) The AGT Board has,  by  unanimous  vote of those  present,
duly and validly approved,  and taken all corporate actions required to be taken
by the AGT Board for the consummation of, the transactions  contemplated hereby,
including the Merger,  and resolved to recommend  that the  stockholders  of AGT
approve and adopt the Share  Issuance.  The action of the AGT Board in approving
this Agreement and the transactions  contemplated hereby,  including the Merger,
is  sufficient  to render  inapplicable  to the  Merger and this  Agreement  the
provisions  of Section 203 of the DGCL and, to the knowledge of AGT, no Delaware
or other State takeover statute or similar statute or regulation  applies to the
Merger, this Agreement or any of the transactions contemplated hereby.

                  SECTION 4.4.  SEC Reports; Financial Statements.

                  (a) AGT has filed all required  forms,  reports and  documents
with the SEC since April 16,  1996,  each of which has  complied in all material
respects with all applicable requirements of the Securities Act and the Exchange
Act,  each as in effect on the dates such  forms,  reports  and  documents  were
filed. AGT has heretofore made available to the Company,  in the form filed with
the SEC (including any amendments thereto),  (i) its Annual Reports on Form 10-K
for the  fiscal  year  ended  December  31,  1996,  (ii)  all  definitive  proxy
statements  relating  to AGT's  meetings  of  stockholders  (whether  annual  or
special) held since April 16, 1996 and (iii) all other  reports or  registration
statements  filed  by AGT  with the SEC  since  April  16,  1996  (the  "AGT SEC
Reports").  None  of  such  forms,  reports  or  documents,  including,  without
limitation,  any financial  statements or schedules  included or incorporated by
reference  therein,  contained,  when filed,  any untrue statement of a material
fact or omitted to state a material fact  required to be stated or  incorporated
by reference  therein or necessary in order to make the statements  therein,  in
light of the  circumstances  under  which they were made,  not  misleading.  The
consolidated  financial  statements  of AGT  included  in the  AGT  SEC  Reports
complied  as to  form  in  all  material  respects  with  applicable  accounting
requirements  and the published  rules and  regulations  of the SEC with respect
thereto and fairly  presented,  in conformity  with GAAP applied on a consistent
basis  (except  as may be  indicated  in the notes  thereto),  the  consolidated
financial  position  of AGT and its  consolidated  subsidiaries  as of the dates
thereof and their  consolidated  results of operations  and changes in financial
position  for the  periods  then ended  (subject,  in the case of the  unaudited
interim financial statements, to normal year-end adjustments).  Since January 1,
1997, except as set forth in the AGT SEC Reports, there has not been any change,
or any application or request for any change,  by AGT or any of its subsidiaries
in accounting  principles,  methods or policies for financial  accounting or tax
purposes (subject, in the case of the unaudited interim financial statements, to
normal year-end adjustments).

                  (b)  AGT  has  heretofore  made  available  to the  Company  a
complete and correct copy of any material  amendments  or  modifications,  which
have  not yet  been  filed  with  the SEC,  to  agreements,  documents  or other
instruments  which previously had been filed by AGT with the SEC pursuant to the
Exchange Act.

                  SECTION 4.5.  Information  Supplied.  None of the  information
supplied or to be supplied by AGT or  Acquisition  in writing for  inclusion  or
incorporation  by  reference  in (i) the S-4 will,  at the time the S-4 is filed
with the SEC and at the time it  becomes  effective  under the  Securities  Act,
contain any untrue  statement  of a material  fact or omit to state any material
fact required to be stated therein or necessary to make the  statements  therein
not  misleading and (ii) the Joint Proxy  Statement  will, at the date mailed to
stockholders  of the  Company  and  AGT  and at the  times  of the  meetings  of
stockholders  of the Company and AGT to be held in  connection  with the Merger,
contain any untrue  statement  of a material  fact or omit to state any material
fact required to be stated  therein or necessary in order to make the statements
therein,  in  light  of  the  circumstances  under  which  they  are  made,  not
misleading.  If at any time prior to the Effective  Time, any event with respect
to AGT, its officers and directors or any of its subsidiaries should occur which
is required to be described in an amendment  of, or a supplement  to, the S-4 or
the Joint  Proxy  Statement,  AGT shall  promptly so advise the Company and such
event shall be so described, and such amendment or supplement (which the Company
and AGT shall have a reasonable  opportunity  to review) shall be promptly filed
with the SEC. The S-4 will comply as to form in all material  respects  with the
provisions of the Securities Act and the rules and regulations  thereunder.  The
Joint Proxy  Statement will comply as to form in all material  respects with the
provisions of the Exchange Act and the rules and regulations thereunder.

                  SECTION 4.6. Consents and Approvals; No Violations. Except for
filings,  permits,  authorizations,  consents  and  approvals as may be required
under,  and other  applicable  requirements of, the Securities Act, the Exchange
Act, state  securities or blue sky laws, the HSR Act, the filing and recordation
of the  Certificate of Merger as required by the DGCL and as otherwise set forth
in Section 4.6 of the AGT Disclosure Schedule,  no filing with or notice to, and
no permit,  authorization,  consent or approval of, any  Governmental  Entity is
necessary for the execution and delivery by AGT or Acquisition of this Agreement
or the  consummation  by AGT or  Acquisition  of the  transactions  contemplated
hereby,  except  where the  failure  to  obtain  such  permits,  authorizations,
consents or approvals or to make such filings or give such notice would not have
or constitute a Material  Adverse Effect on AGT.  Except as set forth in Section
4.6  of the  AGT  Disclosure  Schedule,  neither  the  execution,  delivery  and
performance of this Agreement by AGT or Acquisition nor the  consummation by AGT
or Acquisition of the transactions contemplated hereby will (i) conflict with or
result in any breach of any provision of the respective  certificate or articles
of  incorporation  or  bylaws  (or  similar  governing   documents)  of  AGT  or
Acquisition or any of AGT's  subsidiaries,  (ii) result in a violation or breach
of,  or  constitute  (with or  without  due  notice  or lapse of time or both) a
default (or give rise to any right of  termination,  amendment,  cancellation or
acceleration or Lien) under,  any of the terms,  conditions or provisions of any
note, bond, mortgage,  indenture,  lease, license, contract,  agreement or other
instrument  or  obligation  to  which  AGT  or   Acquisition  or  any  of  AGT's
subsidiaries  is a party  or by  which  any of them or any of  their  respective
properties or assets may be bound or (iii) violate any order, writ,  injunction,
decree, law, statute, rule or regulation applicable to AGT or Acquisition or any
of AGT's subsidiaries or any of their respective properties or assets, except in
the case of (ii) for  violations,  breaches or defaults  which would not have or
constitute a Material Adverse Effect on AGT.

                  SECTION 4.7. No Default. None of AGT or its subsidiaries is in
default or violation (and no event has occurred which with or without due notice
or the lapse of time or both would  constitute  a default or  violation)  of any
term, condition or provision of (i) its certificate or articles of incorporation
or bylaws (or  similar  governing  documents),  (ii) any note,  bond,  mortgage,
indenture, lease, license, contract, agreement or other instrument or obligation
to which AGT or any of its  subsidiaries  is now a party or by which any of them
or any of their respective properties or assets may be bound or (iii) any order,
writ,  injunction,  decree, law, statute,  rule or regulation applicable to AGT,
its subsidiaries or any of their respective  properties or assets, except in the
case of (ii) or (iii) for violations,  breaches or defaults which would not have
or constitute a Material Adverse Effect on AGT.

                  SECTION 4.8. No Undisclosed  Liabilities;  Absence of Changes.
Except as and to the extent  publicly  disclosed  by AGT in the AGT SEC  Reports
filed prior to the date of this Agreement, or as set forth in Section 4.8 of the
AGT  Disclosure  Schedule,  since  January  1,  1997,  (a)  neither  AGT nor its
subsidiaries has incurred any liabilities or obligations of any nature,  whether
or not accrued,  contingent  or  otherwise,  and whether due or to become due or
asserted or unasserted,  which would have a Material  Adverse Effect on AGT, (b)
AGT has  conducted  its business in the  ordinary  course  consistent  with past
practices,  (c) AGT has not paid any dividend or  distribution in respect of, or
redeemed or repurchased any AGT Securities,  (d) other than consistent with past
practices,  AGT has not entered into or  consummated  any  transaction  with any
officer,  director  or  affiliate  of AGT or any  person  known  by AGT to be an
affiliate of any of them and (e) AGT has not changed its methods of accounting.

                  SECTION 4.9.  Litigation.  Except as publicly disclosed by AGT
in the AGT  SEC  Reports  or  disclosed  in  Section  4.9 of the AGT  Disclosure
Schedule,  there is no suit, claim, action,  proceeding or investigation pending
or, to the knowledge of AGT,  threatened  against AGT or any of its subsidiaries
or any of their respective properties or assets which (a) individually or in the
aggregate,  would have or  constitute  a Material  Adverse  Effect on AGT or (b)
questions  the  validity of this  Agreement  or any action to be taken by AGT in
connection with the  consummation  of the  transactions  contemplated  hereby or
could otherwise prevent or materially delay the consummation of the transactions
contemplated by this Agreement.  Except as publicly  disclosed by AGT in the AGT
SEC  Reports,  none of AGT or its  subsidiaries  is subject  to any  outstanding
order, writ,  injunction or decree which would have a Material Adverse Effect on
AGT.

                  SECTION  4.10.  Compliance  with  Applicable  Law.  Except  as
publicly disclosed by AGT in the AGT SEC Reports,  AGT and its subsidiaries hold
all  permits,  licenses,  variances,  exemptions,  orders and  approvals  of all
Governmental  Entities  necessary  for the lawful  conduct  of their  respective
businesses  (the "AGT  Permits"),  except  for  failures  to hold such  permits,
licenses,  variances,  exemptions,  orders and approvals  which would not have a
Material  Adverse Effect on AGT. Except as publicly  disclosed by AGT in the AGT
SEC Reports,  AGT and its  subsidiaries  are in compliance with the terms of the
AGT  Permits,  except  where the failure so to comply  could not  reasonably  be
expected to have a Material Adverse Effect on AGT. Except as publicly  disclosed
by AGT in the AGT SEC Reports,  the businesses of AGT and its  subsidiaries  are
not being  conducted  in violation of any law,  ordinance or  regulation  of any
Governmental  Entity except that no  representation  or warranty is made in this
Section 4.10 with respect to  Environmental  Laws and except for  violations  or
possible  violations  which  would not have a  Material  Adverse  Effect on AGT.
Except as publicly  disclosed  by AGT in the AGT SEC Reports or as  disclosed in
Section 4.10 of the AGT Disclosure  Schedule,  no investigation or review by any
Governmental  Entity with respect to AGT or its  subsidiaries  is pending or, to
the  knowledge  of  AGT,  threatened,  nor to the  knowledge  of  AGT,  has  any
Governmental  Entity  indicated an intention to conduct the same, other than, in
each case,  those the outcome of which would not have a Material  Adverse Effect
on AGT.

                  SECTION 4.11.  Employee Plans.

                  (a) Section  4.11(a) of the AGT Disclosure  Schedule lists all
"employee  benefit plans," as defined in Section 3(3) of the ERISA and all other
employee  benefit  plans  or other  benefit  arrangements,  including  executive
compensation,   directors'  benefit,  bonus  or  other  incentive  compensation,
severance and deferred  compensation plans and practices which AGT or any of its
subsidiaries  maintains,  is a party to, contributes to or has any obligation to
or liability for (each an "AGT Benefit Plan" and collectively,  the "AGT Benefit
Plans").

                  (b) True,  correct and complete copies or descriptions of each
AGT  Benefit  Plan  (and,  where  applicable,   the  most  recent  summary  plan
description,  actuarial report,  determination letter, most recent Form 5500 and
trust agreement) have been made available to the Company for review prior to the
date hereof.

                  (c) As of the date  hereof,  except as  disclosed  on  Section
4.11(c) of the AGT Disclosure Schedule, (i) all material payments required to be
made by or under any AGT Benefit Plan,  any related  trusts,  or any  collective
bargaining  agreement  have  been  made;  (ii)  AGT  and its  subsidiaries  have
performed  all material  obligations  required to be performed by them under any
AGT Benefit Plan; (iii) the AGT Benefit Plans have been administered in material
compliance with their terms and the  requirements  of ERISA,  the Code and other
applicable laws; (iv) there are no actions, suits, arbitrations or claims (other
than routine claims for benefit) pending or, to the knowledge of AGT, threatened
with respect to any AGT Benefit Plan; and (v) AGT and its  subsidiaries  have no
liability as a result of any "prohibited transaction" (as defined in Section 406
of ERISA and Section 4975 of the Code) for any excise tax or civil penalty.

                  (d)  Except  as  disclosed on  Section 4.11(d) of the  AGT
Disclosure  Schedule,  none of the AGT  Benefit  Plans is subject to Title IV of
ERISA.
                  (e)  Except  as set  forth  on  Section  4.11(e)  of  the  AGT
Disclosure Schedule,  AGT and its subsidiaries have not incurred any unsatisfied
withdrawal  liability  with  respect  to any  multiemployer  plan as  defined in
Section 4001(a)(3) of ERISA.

                  (f) Section 4.11(f) of the AGT Disclosure  Schedule sets forth
a list of all  "employee  pension  plans," as defined on Section  3(2) of ERISA,
maintained by AGT or any of its  subsidiaries on any trade or business  (whether
or not incorporated)  which are under control,  or which are treated as a single
employer,  with AGT under Section  414(b),  (c), (m) or (o) of the Code (an "AGT
ERISA Affiliate"),  or to which AGT, its Subsidiaries or any AGT ERISA Affiliate
contributed  or is obligated to contribute  thereunder  ("AGT  Pension  Plans").
Except as set forth on Section 4.11(f) of the AGT Disclosure  Schedule,  each of
the AGT Pension Plans which is intended to be "qualified"  within the meaning of
Section  401(a)  and  401(k),  if  applicable,  and  501(a) of the Code has been
determined  by the Internal  Revenue  Service to be so  "qualified"  and, to the
knowledge of AGT,  there is no fact which would  adversely  affect the qualified
status of any such AGT Pension Plan.

                  (g)  Except  as set  forth  on  Section  4.11(g)  of  the  AGT
Disclosure  Schedule,  neither the execution and delivery of this  Agreement nor
the consummation of the transactions  contemplated hereby will (i) result in any
payment becoming due, or increase the amount of compensation due, to any current
or former employee of AGT or any of its subsidiaries; (ii) increase any benefits
otherwise   payable  under  any  AGT  Benefit  Plan;  or  (iii)  result  in  the
acceleration of the time of payment or vesting of any such benefits.

                  (h) If and to the extent  applicable,  no AGT Benefit Plan has
or has incurred an accumulated  funding deficiency within the meaning of Section
302 of ERISA or  Section  412 of the Code,  nor has any  waiver  of the  minimum
funding  standards  of  Section  302 of ERISA and  Section  412 of the Code been
requested of or granted by the IRS with respect to any AGT Benefit Plan, nor has
any lien in favor of any such plan arisen  under  Section  412(n) of the Code or
Section  302(f) of ERISA.  Except as  indicated  on Schedule  4.11(h) of the AGT
Disclosure  Schedule,  no AGT  Benefit  Plan is self  funded  by AGT.  Except as
disclosed on Schedule  4.11(h) of the AGT Disclosure  Schedule,  with respect to
any insurance policy providing  funding for benefits under any AGT Benefit Plan,
there is no liability  of AGT in the nature of a  retroactive  rate  adjustment,
loss sharing arrangement or other actual or contingent liability, and there will
be no such liability  arising wholly or partially out of events  occurring prior
to the execution of this Agreement, nor would there be any such liability if AGT
cancelled such policy as of the date hereof.

                  SECTION 4.12.  Environmental  Matters. (a) Except as disclosed
in  Section  4.12(a)  of the  AGT  Disclosure  Schedule,  AGT  and  each  of its
subsidiaries,  with respect to its use of and operations at each Property, is in
compliance in all respects with all applicable  Environmental Laws, except where
the failure to so be in compliance would not,  individually or in the aggregate,
have a Material Adverse Effect on AGT.

                  (b)  Except  as  disclosed  in  Section  4.12(b)  of  the  AGT
Disclosure  Schedule or as disclosed in any AGT SEC document  filed with the SEC
prior to the date  hereof,  as of the date  hereof,  neither  AGT nor any of its
subsidiaries or any of their  respective  predecessors  has received any written
communication  form a court,  arbitrator  or  governmental  entity  or any other
person that alleges that AGT or any such  subsidiary  or  predecessor  is not in
compliance,  in any  respect,  with  any  Environmental  Law  or  has  liability
thereunder,  except, in each case it is reasonably unlikely,  individually or in
the aggregate, to have a Material Adverse Effect on AGT.

                  (c)  Except  as  disclosed  in  Section  4.12(c)  of  the  AGT
Disclosure  Schedule,  none of the operations or Properties of AGT or any of its
subsidiaries or any of their  respective  predecessors or assigns is the subject
of  investigation  by any  governmental  entity  whether U.S.,  State,  local or
foreign,  respecting  (A)  Environmental  Laws,  (B) Remedial  Action or (C) any
Environmental  Claim  arising  from a  Release  or  otherwise  of any  Hazardous
Substance or any other substance regulated under any Environmental Law, which in
each case  would,  individually  or in the  aggregate,  have a Material  Adverse
Effect on AGT.

                  (d)  Except  as  disclosed  in  Section  4.12(d)  of  the  AGT
Disclosure  Schedule,  AGT, each of its subsidiaries and any of their respective
predecessors have filed all notices required to be filed under all Environmental
Laws reporting any Release, except where failure to file such notices would not,
individually or in the aggregate, have a Material Adverse Effect on AGT.

                  (e)  Except  as  disclosed  in  Section  4.12(e)  of  the  AGT
Disclosure Schedule, or as disclosed in any AGT SEC Report,  neither AGT nor any
of its subsidiaries has any contingent  liabilities with respect to its business
or that of its  predecessors  in  connection  with any  Hazardous  Substance  or
Environmental Law that would,  individually or in the aggregate, have a Material
Adverse Effect on AGT.

                  (f)  Except  as  disclosed  in  Section  4.12(f)  of  the  AGT
Disclosure  Schedule,  or as  disclosed  in any AGT SEC  Report,  as of the date
hereof,  underground  storage tanks are not located on or under any Property and
there have been no Releases of Hazardous Substances on, in or under any Property
or  other  real  property  for  which  AGT or any of its  subsidiaries  would be
responsible or potentially  responsible  and that would have a Material  Adverse
Effect on AGT.

                  (g)  Except  as  disclosed  in  Section  4.12(g)  of  the  AGT
Disclosure  Schedule,  or as  disclosed in any AGT SEC Report filed with the SEC
prior to the date  hereof,  neither  AGT nor any of its  subsidiaries  or any of
their  respective  predecessors  is subject to any judicial,  administrative  or
arbitral  actions,  suits,  proceedings  (public or private),  written claims or
governmental  proceedings  alleging the  violation of any  Environmental  Law or
Environmental  Permit  that  is  reasonably  likely,   individually  or  in  the
aggregate, to have a Material Adverse Effect on AGT.

                  (h)  Except  as  disclosed  in  Section  4.12(h)  of  the  AGT
Disclosure Schedule,  or as disclosed in any AGT SEC Document filed with the SEC
prior to the date  hereof,  neither  AGT nor any of its  subsidiaries  or any of
their respective  predecessors or assigns,  as a result of their respective past
and current  operations,  has caused or permitted  any  Hazardous  Substances to
remain  or be  disposed  of,  either  on or under  any  Property  or on any real
property not permitted to accept, store or dispose of such Hazardous Substances,
that would,  individually or in the aggregate, have a Material Adverse Effect on
AGT.

                  SECTION 4.13. Tax Matters. Except as disclosed on Section 4.13
of the AGT Disclosure Schedule:

                  (a) AGT and  each of its  subsidiaries,  and  each  affiliated
group  (within the  meaning of Section  1504 of the Code) of which AGT or any of
its  subsidiaries  is or has ever been a member,  has (or, by the Closing  Date,
will have)  timely filed with the  appropriate  taxing  authorities  all federal
income tax returns and all other material tax returns and reports required to be
filed by it through  the  Closing  Date.  All such tax  returns are (or will be)
complete and correct in all material  respects.  Except to the extent adequately
reserved for in accordance with GAAP, AGT and each of its  subsidiaries has (or,
by the  Closing  Date,  will  have)  paid (or AGT has paid on its  subsidiaries'
behalf)  all taxes due in respect  of the  taxable  periods  covered by such tax
returns. The most recent consolidated  financial statements contained in AGT SEC
Reports  reflect  an  adequate  reserve  in  accordance  with GAAP for all taxes
payable by AGT and its subsidiaries for all taxable periods and portions thereof
through the date of such  financial  statements.  AGT has made  available to the
Company  copies of all income and franchise tax returns filed by AGT and each of
its subsidiaries for their taxable years ended in 1995, 1996 and 1997.

                  (b) No material deficiencies for any taxes have been proposed,
asserted or assessed against AGT or any of its  subsidiaries  that have not been
fully paid or adequately provided for in the appropriate financial statements of
AGT and its subsidiaries, no State where AGT or one of its subsidiaries does not
file an income or  franchise  tax return  has  asserted  in  writing  during the
preceding five years that such corporation  should be so filing, no requests for
waivers of the time to assess any taxes are  pending,  and no power of  attorney
with respect to any taxes has been executed or filed with any taxing  authority.
No material issues relating to taxes have been raised in writing by the relevant
taxing authority during any presently pending audit or examination.  The federal
income tax returns of AGT and each of its subsidiaries  consolidated in such tax
returns have not been reviewed or passed upon by the Internal Revenue Service.

                  (c) No  material  Liens for taxes  exist  with  respect to any
assets or  properties  of AGT or any of its  subsidiaries,  except for statutory
liens for taxes not yet due.

                  (d) None of AGT or any of its subsidiaries is a party to or is
bound  by any  tax  sharing  agreement,  tax  indemnity  obligation  or  similar
agreement,  arrangement or practice with respect to taxes (including any advance
pricing  agreement,  closing agreement or other agreement relating to taxes with
any taxing  authority)  (other than any such tax sharing agreement among AGT and
its  subsidiaries  as  set  forth  in  Section  4.13(d)  of the  AGT  Disclosure
Schedule).

                  (e) None of AGT or any of its subsidiaries  has taken,  agreed
to take or will take any action that would prevent the Merger from  constituting
a reorganization qualifying under the provisions of Section 368(a) of the Code.

                  (f) Neither  AGT nor any of its  subsidiaries  has made,  will
make,  is  obligated  to  make  or is  party  to any  employment,  severance  or
termination  agreement,  other  compensation  arrangement  or AGT  Benefit  Plan
currently  in effect which  provides  for the making of any payment  (whether in
cash or property or the vesting of  property)  that would not be  deductible  by
reason of Sections 280G or 162(m) of the Code.

                  (g) AGT and its  subsidiaries  have  complied in all  material
respects with all applicable laws, rules and regulations relating to the payment
and withholding of taxes.

                  (h) No  federal,  state,  local  or  foreign  audits  or other
administrative  proceedings  or  court  proceedings  are  presently  pending  or
threatened in writing with regard to any federal income or material state, local
or foreign taxes or tax returns of AGT or its  subsidiaries  and neither AGT nor
any of its  subsidiaries  has received a written  notice of any pending audit or
proceeding.

                  (i) Neither AGT  nor any of its subsidiaries has agreed to or
is required to make any adjustment under Section 481(a) of the Code.

                  (j) Neither  AGT  nor  any of its  subsidiaries  has (i)  with
regard to any  assets  or  property  held or  acquired  by any of them,  filed a
consent  to the  application  of  Section  341(f)  of the Code 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 AGT or any
of its subsidiaries,  (ii) executed or entered into a closing agreement pursuant
to Section 7121 of the Code or any similar provision of state,  local or foreign
law or (iii)  received or filed any  requests for rulings or  determinations  in
respect of any taxes within the last five years.

                  (k) No property owned by AGT or any of its subsidiaries (i) is
property required to be treated as being owned by another Person pursuant to the
provisions of Section 168(f)(8) of the Internal Revenue Code of 1954, as amended
and in effect  immediately prior to the enactment of the Tax Reform Act of 1986;
(ii)  constitutes  "tax  exempt  use  property"  within  the  meaning of Section
168(h)(1) of the Code;  or (iii) is "tax exempt bond financed  property"  within
the meaning of Section 168(g) of the Code.

                  (l) AGT and each of its subsidiaries  are not currently,  have
not been  within  the last five years and do not  anticipate  becoming a "United
States real property  holding  company"  within the meaning of Section 897(c) of
the Code.

                  (m) AGT is not a foreign  person within the meaning of Section
1445(b)(2) of the Code.

                  SECTION 4.14.  Intellectual  Property.  Except as set forth in
Section 4.14 of the AGT Disclosure Schedule, AGT or one of its subsidiaries owns
or possesses (and will own or possess as of the Effective Time) all right, title
and interest in and to, or a valid and enforceable license or other right to use
all of the  Intellectual  Property  (as  defined  below),  and all of the right,
benefits and privileges associated therewith, that is material to the conduct of
the  business  of AGT  and  its  subsidiaries  as  currently  conducted  (and as
conducted as of the Effective  Time).  To the knowledge of AGT,  neither AGT nor
any of its subsidiaries has infringed, misappropriated or otherwise violated any
Intellectual Property of any other person. To the knowledge of AGT, no person is
materially  infringing upon any Intellectual Property right of AGT or any of its
subsidiaries.

                  SECTION 4.15.  Material Contracts.

                  (a) AGT has made  available to the Company  true,  correct and
complete   copies  of  all  contracts  and  agreements   (and  all   amendments,
modifications  and  supplements  thereto and all side  letters to which AGT is a
party affecting the obligations of any party  thereunder) to which AGT or any of
its  subsidiaries  is a party or by which any of its  properties  or assets  are
bound that are  material to the  business,  properties  or assets of AGT and its
subsidiaries taken as a whole, including,  without limitation,  (I) contracts or
agreements with any supplier or customer, in each case which could result in the
payment  or  receipt  of monies in excess of  $2,500,000  in any  calendar  year
period;  (II) to the extent any of the  following  are,  individually  or in the
aggregate,  material  to the  business,  properties  or  assets  of AGT  and its
subsidiaries  taken  as  a  whole,  all:  (i)  employment,   product  design  or
development,  personal  services,  consulting,  non-competition,   severance  or
indemnification contracts (including,  without limitation, any contract to which
AGT or any of its  subsidiaries is a party involving  employees of AGT or any of
its  subsidiaries);  (ii) licensing,  merchandising or distribution  agreements;
(iii)  contracts  granting a right of first refusal or first  negotiation;  (iv)
partnership or joint venture  agreements;  (v)  agreements for the  acquisition,
sale, lease or other disposition of material  properties or assets of AGT or its
subsidiaries or predecessors (by merger,  purchase or sale of assets or stock or
otherwise)  entered into since April 16, 1996 and (vi)  contracts or  agreements
with any  Governmental  Entity and (III) all commitments and agreements to enter
into any of the  foregoing  items in (I) or (II) above  (collectively,  together
with any such contracts entered into in accordance with Section 5.1 hereof,  the
"AGT Contracts").

                  (b) Each of the AGT  Contracts  is valid  and  enforceable  in
accordance  with  its  terms,  subject  to  applicable  bankruptcy,  insolvency,
fraudulent  conveyance,  reorganization,  moratorium  and similar laws affecting
creditors' rights and remedies generally, and subject, as to enforceability,  to
general principles of equity, including principles of commercial reasonableness,
good faith and fair dealing  (regardless  of whether  enforcement is sought in a
proceeding at law or in equity),  and there is no default under any AGT Contract
so listed either by AGT or, to the knowledge of AGT, by any other party thereto,
and no event has occurred that with the lapse of time or the giving of notice or
both would  constitute a default  thereunder by AGT or, to the knowledge of AGT,
any other  party,  in any such case in which such  default or event would have a
Material Adverse Effect on AGT.

                  (c) No party to any such AGT  Contract has given notice to AGT
of or made a claim against AGT with respect to any breach or default thereunder,
in any such case in which such breach or default  would have a Material  Adverse
Effect on AGT.

                  SECTION 4.16.  Labor  Matters.  Except as set forth in Section
4.16 of the AGT Disclosure Schedule,  neither AGT nor any of its subsidiaries is
a  party  to or  bound  by any  employment,  severance  compensation,  labor  or
collective  bargaining  agreement pertaining to any current or former directors,
senior executive officers or general managers of AGT or any of its subsidiaries.
No labor  organization  or group of employees of AGT or any of its  subsidiaries
has made a pending written demand for recognition or certification.

                  SECTION 4.17.  Insurance.  Except as set forth in Section 4.17
of the AGT Disclosure  Schedule,  each of AGT and its subsidiaries,  is, and has
been continuously since April 16, 1996 or as to those  subsidiaries  acquired by
AGT  subsequent  to April 16, 1996,  since  becoming a  subsidiary  insured with
financially  responsible  insurers in such  amounts  and against  such risks and
losses as are customary for  companies  conducting  the business as conducted by
AGT and its subsidiaries during such time period. Except as set forth in Section
4.17 of the  AGT  Disclosure  Schedule,  since  April  16,  1996 or as to  those
subsidiaries  acquired by AGT  subsequent  to April 16, 1996,  since  becoming a
subsidiary,  neither  AGT nor any of its  subsidiaries  has  received  notice of
cancellation  or  termination  (or a denial of  coverage)  with  respect  to any
material insurance policy of AGT or its subsidiaries.  The insurance policies of
AGT and its subsidiaries are valid and enforceable policies.

                  SECTION 4.18.  Customers.  Except as set forth in Section 4.18
of the AGT Disclosure Schedule, no customer from which AGT has received revenues
of at least $2,500,000 in any of the past three fiscal years has: (a) threatened
within the last twelve months to terminate,  or to the knowledge of AGT, intends
to cancel or otherwise  terminate,  the  relationship of such person with AGT or
any of its  subsidiaries  or (b) has during  the last  twelve  months  decreased
materially or threatened in writing to decrease or limit materially its usage or
purchase of the services or products of AGT or any of its  subsidiaries,  or, to
the knowledge of AGT, intends to modify  materially its relationship with AGT or
any of its subsidiaries.

                  SECTION  4.19.  No Prior  Activities.  Except for  obligations
incurred in connection with its incorporation or organization or the negotiation
and  consummation of this Agreement and the  transactions  contemplated  hereby,
Acquisition has neither  incurred any obligation or liability nor engaged in any
business  or  activity  of any  type or kind  whatsoever  or  entered  into  any
agreement or arrangement with any person or entity.

                  SECTION 4.20. Opinion of Financial Advisor.  Goldman,  Sachs &
Co. (the "AGT  Financial  Advisor")  has delivered to the AGT Board its opinion,
dated the date of this  Agreement,  to the effect  that,  as of such  date,  the
Merger Consideration is fair to the holders of AGT Common Stock from a financial
point of view, and such opinion has not been withdrawn or modified.

                  SECTION 4.21. Brokers. No broker,  finder or investment banker
(other than  Goldman,  Sachs & Co.) is entitled  to any  brokerage,  finder's or
other fee or commission in connection with the transactions contemplated by this
Agreement based upon arrangements made by and on behalf of AGT or Acquisition or
any of their affiliates.

                  SECTION 4.22. Ownership of Company Common Stock.  AGT does not
own any shares of Company Common Stock.


                                    ARTICLE 5

                                    COVENANTS

                  SECTION 5.1.  Conduct of Business.  Except as  contemplated by
this  Agreement,  during the period from the date hereof to the Effective  Time,
each of the  Company  and AGT  will,  and will  cause  each of their  respective
subsidiaries  to,  conduct its  operations  in the  ordinary  course of business
consistent with past practice and, to the extent consistent  therewith,  with no
less  diligence  and  effort  than  would  be  applied  in the  absence  of this
Agreement,  seek to preserve intact its current business organizations,  seek to
keep  available  the service of its current  officers and  employees and seek to
preserve its relationships with customers,  suppliers and others having business
dealings  with it to the end  that  goodwill  and  ongoing  businesses  shall be
unimpaired  at the  Effective  Time.  Without  limiting  the  generality  of the
foregoing,  and except as otherwise expressly provided in this Agreement,  prior
to the Effective Time, neither the Company, nor AGT, nor any of their respective
subsidiaries will, without the prior written consent of the other, which consent
shall not be unreasonably withheld:

                  (a) amend its  certificate  or  articles of  incorporation  or
bylaws (or other similar  governing  instrument),  except as may be necessary to
effectuate the transactions contemplated hereby;

                  (b) other than in connection  with a Business  Acquisition (as
hereinafter defined),  authorize for issuance,  issue, sell, deliver or agree or
commit to issue,  sell or deliver  (whether  through the issuance or granting of
options, warrants, commitments,  subscriptions, rights to purchase or otherwise)
any stock of any class or any other securities or equity equivalents (including,
without limitation,  any stock options or stock appreciation rights), except for
the issuance of options by AGT to employees of AGT and its  subsidiaries  in the
ordinary  course of business  and the issuance or sale of shares of common stock
by the Company or AGT pursuant to outstanding  options granted prior to the date
hereof;

                  (c) 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, make any other actual,  constructive or deemed distribution in respect of
any shares of its capital stock or otherwise  make any payments to  stockholders
in their capacity as such, or redeem or otherwise  acquire any of its securities
or any securities of any of its subsidiaries;

                  (d) other  than in  connection  with a  Business  Acquisition,
adopt  a  plan  of  complete  or  partial  liquidation,   dissolution,   merger,
consolidation,  restructuring,  recapitalization or other  reorganization of the
Company, AGT or any of their respective subsidiaries (other than the Merger);

                  (e) other  than in  connection  with a  Business  Acquisition,
alter through merger, liquidation, reorganization, restructuring or in any other
fashion the corporate structure or ownership of any subsidiary;

                  (f) except as may be  required  by law or as  contemplated  by
this Agreement, and other than in connection with a Business Acquisition,  enter
into,  adopt or amend or  terminate  any bonus,  profit  sharing,  compensation,
severance,  termination,  stock option,  stock  appreciation  right,  restricted
stock,  performance unit, stock equivalent,  stock purchase agreement,  pension,
retirement,  deferred  compensation,  employment,  severance  or other  employee
benefit agreement, trust, plan, fund, award or other arrangement for the benefit
or welfare of any director, officer or employee in any manner, or (except as set
forth in Section 5.1(f) of the Company Disclosure  Schedule or Section 5.1(f) of
the AGT  Disclosure  Schedule  and except for normal  increases  in the ordinary
course of business consistent with past practice that, in the aggregate,  do not
result in a material increase in benefits or compensation expense to the Company
or AGT, as the case may be, and as required under existing  agreements or in the
ordinary course of business generally consistent with past practice) increase in
any manner the  compensation  or fringe  benefits  of any  director,  officer or
employee  or pay any  benefit not  required  by any plan and  arrangement  as in
effect as of the date hereof  (including,  without  limitation,  the granting of
stock appreciation rights or performance units);

                  (g) except as may be  required  as a result of a change in law
or in generally  accepted  accounting  principles,  change any of the accounting
principles or practices used by it;

                  (h)  revalue  in any  material  respect  any  of  its  assets,
including,   without  limitation,   writing  down  the  value  of  inventory  or
writing-off  notes or accounts  receivable  other than in the ordinary course of
business;

                  (i) make or revoke any tax  election  or settle or  compromise
any tax liability  material to the Company and its  subsidiaries  or AGT and its
subsidiaries,  as the case may be, taken as a whole or change (or make a request
to any  taxing  authority  to  change)  any  material  aspect  of its  method of
accounting for tax purposes;

                  (j) pay, discharge or satisfy any material claims, liabilities
or  obligations  (absolute,  accrued,  asserted  or  unasserted,  contingent  or
otherwise),  other than the payment,  discharge or  satisfaction in the ordinary
course  of  business  of  liabilities  reflected  or  reserved  against  in,  or
contemplated by, the consolidated financial statements (or the notes thereto) of
the Company and its  subsidiaries or AGT and its  subsidiaries,  as the case may
be,  or  incurred  in the  ordinary  course  of  business  consistent  with past
practice;

                  (k)  settle or  compromise  any  pending or  threatened  suit,
action or claim relating to the transactions contemplated hereby; or

                  (l) other  than in  connection  with a  Business  Acquisition,
take,  propose to take,  or agree in writing or  otherwise  to take,  any of the
actions  described in Sections  5.1(a)  through 5.1(k) or any action which would
make  any  of the  representations  or  warranties  of the  Company  or AGT  and
Acquisition  contained  in this  Agreement  untrue or  incorrect in any material
respect.

In addition,  prior to the  Effective  Time,  neither the Company nor any of its
subsidiaries will, without the prior written consent of AGT, which consent shall
not be unreasonably withheld:

                  (m)  enter  into or  modify in any  material  respect  (i) any
agreement which, if in effect on the date hereof,  would have been a Contract or
(ii) any  employment,  consulting,  non-competition  or  severance  agreement as
disclosed in Section 3.18 of the Company Disclosure Schedule.

In  addition,  prior  to  the  Effective  Time,  neither  the  Company  nor  its
subsidiaries will, without the prior written consent of AGT:

                  (n) (i) incur or assume any  long-term or  short-term  debt or
issue any debt securities  except for borrowings  under existing lines of credit
in the  ordinary  course of business  and in amounts not material to the Company
and its  subsidiaries,  taken as a whole;  (ii)  assume,  guarantee,  endorse or
otherwise  become  liable or  responsible  (whether  directly,  contingently  or
otherwise) for the obligations of any other person except in the ordinary course
of business  consistent  with past  practice  and in amounts not material to the
Company and its  subsidiaries,  taken as a whole,  and except for obligations of
wholly  owned   subsidiaries;   (iii)  make  any  loans,   advances  or  capital
contributions  to, or  investments  in, any other  person  (other than to wholly
owned subsidiaries of the Company or customary loans or advances to employees in
the ordinary course of business consistent with past practice and in amounts not
material  to the  maker of such  loan or  advance);  (iv)  pledge  or  otherwise
encumber  shares of capital  stock of the  Company or its  subsidiaries;  or (v)
mortgage or pledge any of its material assets, tangible or intangible, or create
or suffer to exist any material Lien thereupon;

                  (o) acquire,  sell, lease or dispose of any assets outside the
ordinary course of business or any assets which in the aggregate are material to
the Company and its subsidiaries, taken as a whole, enter into any commitment or
transaction  outside the  ordinary  course of  business  or grant any  exclusive
distribution rights;

                  (p) (i) acquire (by merger,  consolidation  or  acquisition of
stock or assets) any corporation,  partnership or other business organization or
division thereof or any equity interest therein;  (ii) authorize any new capital
expenditure or expenditures which, individually, is in excess of $500,000 or, in
the  aggregate,  are in  excess  of $2.0  million;  provided,  that  none of the
foregoing shall limit any capital  expenditure already included in the Company's
fiscal 1998 capital expenditure budget provided to AGT prior to the date hereof;
or (iv) enter into or amend any contract,  agreement,  commitment or arrangement
providing for the taking of any action that would be prohibited hereunder; or

                  (q)take, propose  to take, or agree in writing or otherwise to
take, any of the actions described in Sections 5.1(n) through (p).

In addition, prior to the Effective Time, neither AGT nor its subsidiaries will,
other than in conjunction with this Merger, without the prior written consent of
the Company, which consent shall not be unreasonably witheld:

                  (r) enter into or modify in any material respect any agreement
which, if in effect on the date hereof, would have been an AGT Contract pursuant
to Section 4.15.

In addition, prior to the Effective Time, neither AGT nor its subsidiaries will,
other than in conjunction with this Merger, without the prior written consent of
the Company:

                  (s) (i) incur or assume any  long-term or  short-term  debt or
issue any debt securities  except for borrowings  under existing lines of credit
in the ordinary course of business,  borrowings in conjunction with Sections (t)
and (u) of this Section 5.1; (ii) assume, guarantee, endorse or otherwise become
liable or  responsible  (whether  directly,  contingently  or otherwise) for the
obligations  of any other  person  except  in the  ordinary  course of  business
consistent  with past  practice,  and except  for  obligations  of wholly  owned
subsidiaries;  (iii) make any loans,  advances or capital  contributions  to, or
investments in, any other person (other than to wholly owned subsidiaries of AGT
or customary  loans or advances to employees in the ordinary  course of business
consistent  with past  practice and in amounts not material to the maker of such
loan or advance);  (iv) pledge or otherwise  encumber shares of capital stock of
AGT or its  subsidiaries;  or (v) mortgage or pledge any of its material assets,
tangible  or  intangible,  or  create  or  suffer  to exist  any  material  Lien
thereupon;  provided,  however, that notwithstanding the foregoing provisions of
the  paragraph  (s),  AGT  shall be  permitted  to take any  action  under  this
paragraph (s), which without this proviso would otherwise  require the Company's
prior written consent,  without the prior written consent of the Company if such
actions in the aggregate are in an amount not in excess of $20,000,000;

                  (t) acquire,  sell, lease or dispose of any assets outside the
ordinary course of business in a transaction or series of transactions for which
AGT  would be  required  to amend the Form S-4 filed  with the SEC  pursuant  to
Section 5.2 below had the Form S-4 been filed on the date hereof, enter into any
commitment or transaction  outside the ordinary  course of business or grant any
exclusive distribution rights;

                  (u) (i) acquire (by merger,  consolidation,  or acquisition of
stock or assets) any corporation,  partnership or other business organization or
division  thereof or any equity interest therein for which AGT would be required
to amend the Form S-4 filed with the SEC  pursuant  to Section 5.2 below had the
Form  S-4  been  filed  on the  date  hereof;  (ii)  authorize  any new  capital
expenditure  or  expenditures  which,  in  the  aggregate,   are  in  excess  of
$3,000,000;  provided,  that  none of the  foregoing  shall  limit  any  capital
expenditure  already  included in AGT's fiscal 1998 capital  expenditure  budget
provided to the Company  prior to the date hereof;  or (iii) enter into or amend
any contract,  agreement,  commitment or arrangement providing for the taking of
any action that would be prohibited hereunder; or

                  (v)    take, propose to take, or agree in writing or otherwise
to take, any of the actions described in Sections 5.1(s) through (u).

                  For purposes  hereof,  a "Business  Acquisition"  shall be any
acquisition by AGT or any of its  subsidiaries  of any assets,  capital stock or
operating businesses as may be approved by the Board of Directors of AGT and, if
required by this Section 5.1, by the Company .

                  SECTION 5.2. Preparation of S-4 and the Joint Proxy Statement.
AGT and the Company will, as promptly as  practicable,  jointly prepare and file
with  the SEC the  Joint  Proxy  Statement  in  connection  with the vote of the
stockholders  of the  Company  with  respect  to the  Merger and the vote of the
stockholders of AGT with respect to the Share Issuance. AGT will, as promptly as
practicable,  prepare and following receipt of notification from the SEC that it
has no further comments on the Joint Proxy Statement, file with the SEC the S-4,
containing the Joint Proxy  Statement and forms of proxy, in connection with the
registration under the Securities Act of the shares of AGT Common Stock issuable
upon conversion of the Shares and the other  transactions  contemplated  hereby.
AGT and the Company will, and will cause their  accountants  and lawyers to, use
all reasonable best efforts to have or cause the S-4 to be declared effective as
promptly  as  practicable,   including,   without   limitation,   causing  their
accountants  to deliver  necessary  or required  instruments  such as  opinions,
consents and certificates,  and will take any other action required or necessary
to be taken under  federal or state  securities  laws or otherwise in connection
with  the  registration  process.  Each  of AGT  and the  Company  will  use its
reasonable  best efforts to cause the Joint Proxy  Statement to be mailed to its
stockholders at the earliest  practicable  date after the  effectiveness  of the
S-4.

                  SECTION 5.3.  No Solicitation.

                  (a) Until the termination of this Agreement, the Company shall
not,  and  shall  not  permit  any  of  its  subsidiaries,  or any of its or its
subsidiaries'  officers,  directors,  employees,   representatives,   agents  or
affiliates  (including,  without  limitation,  any investment banker,  financial
advisor,  attorney,  accountant or other representative of the Company or any of
its subsidiaries),  to, directly or indirectly,  initiate,  solicit or knowingly
encourage (including by way of furnishing non-public information or assistance),
or take any other  action to  facilitate,  any  inquiries  or the  making of any
proposal  that  constitutes,  or may  reasonably  be  expected  to lead  to,  an
Acquisition  Proposal (as defined below),  or enter into or maintain or continue
discussions  or  negotiate  with any  person or entity  in  furtherance  of such
inquiries  or to obtain  an  Acquisition  Proposal  or agree to or  endorse  any
Acquisition Proposal,  or authorize or permit any of its officers,  directors or
employees  or any of  its  subsidiaries  or  any  investment  banker,  financial
advisor,  attorney,  accountant  or  other  representative  of it or  any of its
subsidiaries  to take any such  action;  provided,  however,  that this  Section
5.3(a) shall not prohibit the Company  from  furnishing  non-public  information
regarding the Company to, or entering into  discussions and  negotiations  with,
any person in response to an unsolicited written Acquisition  Proposal submitted
by such person if (i) the Company  Board  concludes in good faith,  after having
received the advice of its financial advisor, that such Acquisition Proposal, if
consummated,  could  result  in a  transaction  that  is more  favorable  from a
financial point of view to the Company's stockholders than the Merger, including
as part of the Company Board's determination, that, as to any cash consideration
to be  paid  pursuant  to such  Acquisition  Proposal,  the  person  making  the
Acquisition  Proposal has all requisite funds on hand or has provided  customary
financing  commitments  for the requisite  funds to consummate  the  Acquisition
Proposal,  (ii)  not  later  than 24  hours  after  receipt  of any  unsolicited
Acquisition  Proposal,  the  Company  gives AGT notice  (which  notice  shall be
provided  orally and in  writing  and shall  identify  the  person  making  such
Acquisition Proposal and set forth the material terms thereof) of the receipt of
such  Acquisition  Proposal  unless the Company Board  determines in good faith,
after having  received the advice of its legal counsel,  that giving such notice
is  inconsistent  with the Company  Board's  fiduciary  duties to the  Company's
stockholders under applicable law, (iii) prior to furnishing any such non-public
information to such Person, the Company enters into a confidentiality  agreement
with terms not materially less favorable to the Company than the Confidentiality
Agreement  (as  defined in Section  5.6(d))  and (iv) prior to  furnishing  such
non-public  information to such Person,  the Company  furnishes such  non-public
information to AGT to the extent such non-public  information has not previously
been furnished by the Company to AGT.  Notwithstanding  anything to the contrary
in this Agreement, the Company may give a copy of this Section 5.3 to any person
who inquires about submitting an unsolicited  Acquisition Proposal. For purposes
of this Agreement,  "Acquisition  Proposal" means any proposal  regarding any of
the  following  (other than the  transactions  contemplated  by this  Agreement)
involving the Company or any of its subsidiaries: (w) any merger, consolidation,
share  exchange,   recapitalization,   business  combination  or  other  similar
transaction;  (x) any sale, lease, exchange, mortgage, pledge, transfer or other
disposition  of 20  percent  or  more  of the  assets  of the  Company  and  its
subsidiaries,  taken as a whole,  in a single  transaction  or series of related
transactions;  (y) any tender offer or exchange offer that if consummated  would
result in any person beneficially owning more than 20 percent of the outstanding
shares of Company Common Stock or the filing of a registration  statement  under
the Securities Act in connection therewith;  or (z) any public announcement of a
proposal,  plan or  intention  to do any of the  foregoing  or any  agreement to
engage in any of the foregoing.

                  (b) Except as set forth in this  Section  5.3(b),  the Company
Board shall not (i) withdraw or modify,  or propose to withdraw or modify,  in a
manner  adverse to AGT,  the approval or  recommendation  of the Merger and this
Agreement by the Company Board, (ii) approve or recommend, or propose to approve
or recommend,  any Acquisition Proposal or (iii) cause the Company to enter into
any agreement (including, without limitation, any letter of intent) with respect
to any Acquisition Proposal (any of (i), (ii) or (iii),  "Withdraw");  provided,
however,  that nothing in this  Agreement  shall  prevent the Company Board from
withdrawing,  amending or modifying  its  recommendation  of the Merger and this
Agreement  if (i) an  unsolicited  bona fide  written  Acquisition  Proposal  is
submitted to the Company,  (ii) the Company Board concludes in good faith, after
having  received  the advice of its  independent  financial  advisor,  that such
Acquisition Proposal would result in a transaction that is more favorable from a
financial  point  of view to the  Company's  stockholders  than  the  Merger  (a
"Superior  Proposal") and (iii) the Company Board concludes in good faith, after
consultation  with  its  legal  counsel,  that  the  withdrawal,   amendment  or
modification of such  recommendation in connection with the Superior Proposal is
consistent with the fiduciary  obligations of the Company Board to the Company's
stockholders  under  applicable  law.  Nothing  herein shall prevent the Company
Board from recommending that its stockholders accept an unsolicited tender offer
or  exchange  offer  commenced  by a third party with  respect to the  Company's
Common  Stock  if (u)  such  tender  offer  or  exchange  offer  constitutes  an
Acquisition   Proposal,   (v)  the  Company  Board  shall  have   withdrawn  its
recommendation in favor of the Merger in accordance with and as permitted by the
preceding  sentence,  (w) the Company Board shall have  concluded in good faith,
after having  received  the advice of its  financial  advisor,  that such tender
offer or exchange offer is a Superior Proposal, (x) the Company Board shall have
concluded  in good  faith,  after  consultation  with  legal  counsel,  that the
recommendation  in favor of acceptance of such tender offer or exchange offer is
consistent with the fiduciary  obligations of the Company Board to the Company's
stockholders  under  applicable law, (y) the Company shall have given AGT notice
of the Company  Board's  intention  to Withdraw and (z) AGT does not make within
five days of AGT's  receipt of such  notice,  an offer which the Company  Board,
after consultation with its financial  advisors,  determines is superior to such
Superior Proposal. In addition, if the Company Withdraws,  it shall concurrently
pay, or cause to be paid, to AGT the fee required by Section 7.3(a) hereof.

                  SECTION 5.4. Letters of the Company's and AGT's Accountants.

                  (a) The Company shall use all reasonable best efforts to cause
to be  delivered  to AGT a letter of KPMG  Peat  Marwick  LLP (or its  successor
firm), the Company's independent auditors, dated a date within two business days
before the date on which the S-4 shall become effective and addressed to AGT, in
form and  substance  reasonably  satisfactory  to AGT and customary in scope and
substance for letters delivered by independent  public accountants in connection
with registration statements similar to the S-4.

                  (b) AGT shall use all  reasonable  best efforts to cause to be
delivered  to the  Company a letter of  Deloitte & Touche LLP (or its  successor
firm), AGT's independent auditors,  dated a date within two business days before
the date on which the S-4 shall become  effective  and addressed to the Company,
in form and substance  reasonably  satisfactory  to the Company and customary in
scope and substance for letters delivered by independent  public  accountants in
connection with registration statements similar to the S-4.

                  SECTION 5.5.  Meetings.  The Company and AGT each shall call a
meeting  of its  stockholders  to be held as  promptly  as  practicable  for the
purpose  of voting  upon this  Agreement  and the  Merger  (with  respect to the
Company)  and the Share  Issuance  (with  respect  to AGT).  Subject  to Section
5.3(b),  the Company agrees that its obligations  pursuant to the first sentence
of this Section 5.5 shall not be affected by the commencement,  public proposal,
public  disclosure or communication to the Company of any Acquisition  Proposal.
AGT  and the  Company  will,  through  their  respective  Boards  of  Directors,
recommend to their  respective  stockholders  approval of this Agreement and the
Merger (with  respect to the Company) and the Share  Issuance  (with  respect to
AGT),  subject  to the right of the  Company  Board to modify  or  withdraw  its
recommendation  pursuant to Section 5.3(b). The Company and AGT shall coordinate
and  cooperate  with  respect  to the  timing of such  meetings  and each of the
Company  and AGT shall use its best  efforts  to hold  such  meeting  as soon as
practicable after the date hereof.

                  SECTION 5.6.  Access to Information.

                  (a) Between the date hereof and the  Effective  Time,  each of
the  parties  hereto  will  give the other  party  hereto  and their  authorized
representatives  reasonable  access  to  all  its  employees,  plants,  offices,
warehouses and other facilities and to all its and its  subsidiaries'  books and
records,  will permit the other parties  hereto to make such  inspections as the
other  parties may  reasonably  require and will cause its officers and those of
its  subsidiaries to furnish the other parties with such financial and operating
data and other  information  with  respect its and its  subsidiaries'  business,
properties  and personnel as the other parties may from time to time  reasonably
request,  provided that no  investigation  pursuant to this Section 5.6(a) shall
affect or be deemed to modify any of the  representations  or warranties made by
any party hereto.

                  (b)  Between  the date  hereof  and the  Effective  Time,  the
Company shall furnish to AGT and Acquisition (i) within five business days after
the delivery thereof to management,  such monthly financial  statements and data
as are regularly prepared for distribution to Company management and (ii) at the
earliest time they are available, such quarterly and annual financial statements
as are prepared for the Company's SEC filings, which (in the case of this clause
(ii)), shall be in accordance with the books and records of the Company.

                  (c) Between the date hereof and the Effective  Time, AGT shall
furnish to the Company (i) within five business days after the delivery  thereof
to  management,  such monthly  financial  statements  and data as are  regularly
prepared for  distribution  to AGT management and (ii) at the earliest time they
are available,  such quarterly and annual  financial  statements as are prepared
for AGT's SEC  filings,  which (in the case of this  clause  (ii)),  shall be in
accordance with the books and records of AGT.

                  (d) Each of AGT and  Acquisition  will hold and will cause its
consultants  and advisors to hold in confidence  all  documents and  information
concerning the Company and its  subsidiaries  furnished to AGT or Acquisition in
connection  with the  transactions  contemplated by this Agreement to the extent
required by that  certain  confidentiality  agreement  entered  into between the
Company and AGT dated November 25, 1997 (the "Confidentiality Agreement").

                  SECTION 5.7. Additional  Agreements;  Reasonable Best Efforts.
Subject to the terms and conditions herein provided,  each of the parties hereto
agrees to use its  reasonable  best efforts to take,  or cause to be taken,  all
action, and to do, or cause to be done, all things reasonably necessary,  proper
or advisable  under  applicable  laws and  regulations  to  consummate  and make
effective the transactions  contemplated by this Agreement,  including,  without
limitation,  (i)  cooperation in the  preparation  and filing of the Joint Proxy
Statement  and the S-4, any filings that may be required  under the HSR Act, and
any  amendments to any thereof;  (ii)  cooperation  in  obtaining,  prior to the
Effective  Time,  the approval for quotation on the NASDAQ,  effective  upon the
official  notice of  issuance,  of the shares of AGT Common Stock into which the
Company Common Stock will be converted  pursuant to Article I hereof;  (iii) the
taking of all action  reasonably  necessary,  proper or  advisable to secure any
necessary  consents of all third parties and  Governmental  Entities,  including
those  relating to  existing  debt  obligations  of the  Company,  AGT and their
respective  subsidiaries;  (iv) contesting any legal proceeding  relating to the
Merger;  and (v) the  execution of any  additional  instruments,  including  the
Certificate  of Merger,  necessary to consummate the  transactions  contemplated
hereby.  Subject  to the  terms  and  conditions  of  this  Agreement,  AGT  and
Acquisition  agree to use all reasonable  efforts to cause the Effective Time to
occur as soon as  practicable  after the  shareholder  vote with  respect to the
Merger.  In case at any time  after the  Effective  Time any  further  action is
necessary to carry out the purposes of this  Agreement,  the proper officers and
directors of each party hereto shall take all such necessary action.

                  SECTION 5.8. Antitrust Reviews. Each party hereto will use all
reasonable  efforts (a) to file with the US Department of Justice and US Federal
Trade Commission, as soon as practicable after the date hereof, the Notification
and Report Form under the HSR Act and any  supplemental  information or material
requested  pursuant  to the HSR Act,  and (b) to comply  as soon as  practicable
after the date hereof with any other laws of any country and the European  Union
under  which any  consent,  authorization,  registration,  declaration  or other
action with  respect to the  transactions  contemplated  herein may be required.
Each party hereto shall furnish to the other such  information and assistance as
the other may  reasonably  request  in  connection  with any filing or other act
undertaken  in  compliance  with the HSR Act or other such laws,  and shall keep
each other timely  apprised of the status of any  communications  with,  and any
inquiries or requests for additional  information from, any Governmental  Entity
under the HSR Act or other such laws. Each of the Company and AGT shall take any
and  all  action  reasonably  necessary  to  prevent  the  entry  of any  order,
preliminary  or permanent  injunction,  or other legal  restraint or prohibition
preventing  consummation of the Merger or any related transactions  contemplated
by this Agreement, and to lift, mitigate or rescind the effect of any litigation
or  administrative   proceeding   adversely  affecting  this  Agreement  or  any
transactions contemplated herein.

                  SECTION 5.9. Public  Announcements.  Each of AGT,  Acquisition
and the Company will consult with one another  before  issuing any press release
or  otherwise  making any public  statements  with  respect to the  transactions
contemplated by this Agreement,  including,  without limitation, the Merger, and
shall not issue any such press release or make any such public  statement  prior
to  such  consultation,  except  as  may be  required  by  applicable  law or by
obligations  pursuant  to any  agreement  with  NASDAQ,  as  determined  by AGT,
Acquisition or the Company, as the case may be.

                  SECTION 5.10.   Indemnification;  Directors' and Officers'
                                  Insurance.

                  (a)  Indemnification.  From and after the Effective  Time, AGT
shall, to the fullest extent permitted by applicable law, indemnify,  defend and
hold  harmless each person who is now, or has been at any time prior to the date
hereof,  or who becomes  prior to the  Effective  Time,  a director,  officer or
employee of the parties hereto or any subsidiary  thereof (each an  "Indemnified
Party"  and,  collectively,  the  "Indemnified  Parties")  against  all  losses,
expenses (including reasonable attorneys' fees and expenses), claims, damages or
liabilities or, subject to the proviso of the next succeeding sentence,  amounts
paid in settlement, arising out of actions or omissions occurring at or prior to
the  Effective  Time and whether  asserted or claimed  prior to, at or after the
Effective Time that are in whole or in part (i) based on, or arising out of, the
fact that such person is or was a director, officer or employee of such party or
a subsidiary of such party or (ii) based on, arising out of or pertaining to the
transactions  contemplated  by this  Agreement.  In the event of any such  loss,
expense, claim, damage or liability (whether or not arising before the Effective
Time), (i) AGT shall pay the reasonable fees and expenses of counsel selected by
the Indemnified Parties, which counsel shall be reasonably  satisfactory to AGT,
promptly after  statements  therefor are received and otherwise  advance to such
Indemnified Party upon request  reimbursement of documented  expenses reasonably
incurred,  in either  case to the  extent  not  prohibited  by the DGCL and upon
receipt of any affirmation  and undertaking  required by the DGCL, (ii) AGT will
cooperate in the defense of any such matter and (iii) any determination required
to be made with respect to whether an Indemnified  Party's conduct complies with
the standards set forth under the DGCL and AGT's  articles of  incorporation  or
bylaws shall be made by independent  counsel mutually  acceptable to AGT and the
Indemnified  Party;  provided,  however,  that AGT shall  not be liable  for any
settlement  effected  without its written  consent  (which  consent shall not be
reasonably withheld). The Indemnified Parties as a group may retain only one law
firm with respect to each related  matter  except to the extent there is, in the
opinion  of counsel to an  Indemnified  Party,  under  applicable  standards  of
professional  conduct,  a conflict on any significant issue between positions of
any two or more Indemnified Parties.

                  (b)  Insurance.  For a period of six years after the Effective
Time,  AGT shall cause to be maintained in effect the policies of directors' and
officers' liability insurance maintained by the Company for the benefit of those
persons  who are  covered by such  policies  at the  Effective  Time (or AGT may
substitute  therefor  policies  of at least the same  coverage  with  respect to
matters  occurring  prior  to the  Effective  Time),  to the  extent  that  such
liability insurance can be maintained annually at a cost to AGT not greater than
150  percent of the premium for the current  Company  directors'  and  officers'
liability insurance;  provided that if such insurance cannot be so maintained or
obtained at such costs,  AGT shall  maintain or obtain as much of such insurance
as can be so  maintained  or  obtained  at a cost  equal to 150  percent  of the
current annual premiums of the Company for such insurance.

                  (c)  Successors.  In the event AGT or any of its successors or
assigns (i)  consolidates  with or merges into any other person and shall not be
the  continuing  or surviving  corporation  or entity or such  consolidation  or
merger or (ii) transfers all or  substantially  all of its properties and assets
to any person,  then and in either such case,  proper provision shall be made so
that the successors and assigns of AGT shall assume the  obligations  set for in
this Section 5.10.

                  (d)  Survival  of  Indemnification.   To  the  fullest  extent
permitted  by  law,   from  and  after  the  Effective   Time,   all  rights  to
indemnification  now existing in favor of the  employees,  agents,  directors or
officers of the Company and its subsidiaries with respect to their activities as
such prior to the  Effective  Time,  as  provided in the  Company's  articles of
incorporation or bylaws, in effect on the date thereof or otherwise in effect on
the date hereof,  shall survive the Merger and shall  continue in full force and
effect for a period of the lesser of six years from the  Effective  Time and the
expiration of the applicable statute of limitations.

                  (e) Benefit.  The provisions of this Section 5.10 are intended
to be for the benefit of, and shall be enforceable by, each  Indemnified  Party,
his or her heirs and his or her representatives.

                  SECTION 5.11.  Notification  of Certain  Matters.  The Company
shall give prompt notice to AGT and Acquisition,  and AGT and Acquisition  shall
give prompt notice to the Company, of (i) the occurrence or nonoccurrence of any
event the  occurrence  or  nonoccurrence  of which  would be likely to cause any
representation  or  warranty  contained  in  this  Agreement  to  be  untrue  or
inaccurate in any material  respect at or prior to the Effective  Time, (ii) any
material  failure of the  Company,  AGT or  Acquisition,  as the case may be, to
comply with or satisfy any covenant,  condition or agreement to be complied with
or  satisfied  by it  hereunder,  (iii) any  notice  of, or other  communication
relating  to, a default or event  which,  with  notice or lapse of time or both,
would become a default,  received by it or any of its subsidiaries subsequent to
the date of this Agreement and prior to the Effective  Time,  under any contract
or agreement  material to the  financial  condition,  properties,  businesses or
results of operations of it and its subsidiaries taken as a whole to which it or
any of its  subsidiaries  is a party or is  subject,  (iv) any  notice  or other
communication from any third party alleging that the consent of such third party
is or may be required in connection with the  transactions  contemplated by this
Agreement,  or (v) the  occurrence  of any Material  Adverse  Effect;  provided,
however, that the delivery of any notice pursuant to this Section 5.11 shall not
cure such breach or  non-compliance  or limit or  otherwise  affect the remedies
available hereunder to the party receiving such notice.

                  SECTION 5.12. Tax-Free Reorganization  Treatment. The Company,
Company Affiliates,  AGT and Acquisition shall execute and deliver to O'Sullivan
Graev & Karabell,  LLP, counsel to the Company,  and Weil, Gotshal & Manges LLP,
counsel to AGT, certificates containing customary representations  substantially
in the forms  agreed to by the parties on or prior to the date hereof (with such
changes as may be reasonably  requested by such law firms) at such time or times
as may be  reasonably  requested  by such law  firms in  connection  with  their
respective  deliveries  of  opinions,  pursuant  to  Sections  6.2(c) and 6.3(f)
hereof,  with  respect to the tax-free  reorganization  treatment of the Merger.
Prior to the Effective Time,  none of the Company,  Company  Affiliates,  AGT or
Acquisition  shall take or cause to be taken any action  which would cause to be
untrue (or fail to take or cause not to be taken any action which would cause to
be  untrue)  any  of  the   representations  in  such   previously-agreed   upon
certificates.

                  SECTION 5.13. Company Employee Benefits.  Through December 31,
1998, the employees of the Company shall continue to receive  employee  benefits
substantially  comparable in the  aggregate to those  provided for under Company
Benefit  Plans  (other than the plans being  terminated  as set forth on Scedule
5.14 of the  Company  Disclosure  Schedule)  provided by the Company on the date
prior to the Effective Time.

                  SECTION 5.14.  Certain  Payment of Deferred  Compensation  and
Bonuses. Notwithstanding anything to the contrary herein, the Company shall take
such action as necessary (i) to terminate the Company Benefit Plans as indicated
on Schedule 5.14 of the Company  Disclosure  Schedule and (ii) make the payments
required  to be made or  elected by the  Company  to be made  under all  Company
Benefit Plans as set forth on Schedule 5.14 of the Company  Disclosure  Schedule
on or immediately prior to the Effective Time.

                  SECTION  5.15.  Stock  Options.  The  Company  shall  take any
actions required under the terms of the Stock Option Plans,  including,  but not
limited to, obtaining any required  written  consents of the Option holders,  in
order to effectuate the provisions of Section 2.3 hereof.

                  SECTION 5.16.  SEC Filings.  Each of AGT and the Company shall
promptly  provide  the other party (or its  counsel)  with copies of all filings
made by the  other  party or any of its  subsidiaries  with the SEC or any other
state or federal  Governmental  Entity in connection with this Agreement and the
transactions contemplated hereby.

                  SECTION 5.17. Guarantee of Performance.  AGT hereby guarantees
the performance by Acquisition of its obligations under this Agreement.


                                    ARTICLE 6

                    CONDITIONS TO CONSUMMATION OF THE MERGER

                  SECTION 6.1.  Conditions to Each Party's Obligations to Effect
the Merger. The respective obligations of each party hereto to effect the Merger
are  subject  to the  satisfaction  at or  prior  to the  Effective  Time of the
following conditions:

                  (a) this Agreement shall have been approved and adopted by the
requisite vote of the  stockholders of the Company and, the Share Issuance shall
have been approved by the requisite vote of the stockholders of AGT;

                  (b) no statute,  rule,  regulation,  executive order,  decree,
ruling or injunction shall have been enacted,  entered,  promulgated or enforced
by any United States court or United States governmental authority and continued
in effect which prohibits,  restrains,  enjoins or restricts the consummation of
the Merger;

                  (c) any waiting period  applicable to the Merger under the HSR
Act shall have terminated or expired,  and any other  governmental or regulatory
notices or  approvals  required  with respect to the  transactions  contemplated
hereby shall have been either filed or received;

                  (d) the S-4 shall have become  effective  under the Securities
Act and shall not be the subject of any stop order or proceedings seeking a stop
order and AGT  shall  have  received  all state  securities  laws or "blue  sky"
permits and  authorizations  necessary  to issue  shares of AGT Common  Stock in
exchange for the Shares in the Merger;

                  (e)     the AGT Common Stock issuable in the Merger shall have
been  authorized for quotation on the NASDAQ,  upon official notice of issuance;
and

                  (f) the number of directors  of AGT shall have been  increased
by two, and the vacancies  created  thereby shall have been initially  filled by
Marne Obernauer,  Jr. and a designee to be determined jointly by the Company and
AGT.

                  SECTION 6.2. Conditions to the Obligations of the Company. The
obligation of the Company to effect the Merger is subject to the satisfaction at
or prior to the Effective Time of the following conditions:

                  (a) the  representations and warranties of AGT and Acquisition
contained in this Agreement or in any other document  delivered  pursuant hereto
shall be true and correct in all  material  respects at and as of the  Effective
Time with the same effect as if made at and as of the Effective Time, and at the
Closing AGT and Acquisition shall have delivered to the Company a certificate to
that effect;

                  (b)  each  of the  obligations  of AGT and  Acquisition  to be
performed  at or  before  the  Effective  Time  pursuant  to the  terms  of this
Agreement  shall have been duly performed in all material  respects at or before
the Effective Time and at the Closing AGT and  Acquisition  shall have delivered
to the Company a certificate to that effect;

                  (c) the opinion of O'Sullivan Graev & Karabell, LLP, dated the
Closing Date and addressed to the Company  substantially  to the effect that (i)
the Merger will be treated for federal  income tax purposes as a  reorganization
within the meaning of Section 368(a) of the Code; (ii) each of AGT,  Acquisition
and the  Company  will be a party to the  reorganization  within the  meaning of
Section  368(b) of the Code; and (iii) no gain or loss will be recognized by the
Company as a result of the Merger or by a stockholder of the Company as a result
of the Merger with respect to Shares  converted  into shares of AGT Common Stock
(other than with respect to the Per Share Cash Amount and cash  received in lieu
of fractional  shares of AGT Common  Stock),  shall have been delivered and such
opinion shall not have been  withdrawn or modified in any material  respect.  In
rendering such opinion, O'Sullivan Graev & Karabell, LLP shall have received and
may rely upon the representations  contained in the certificates  referred to in
Section 5.12; and

                  (d)  other  than a change in the  price of AGT  Common  Stock,
there shall have been no events,  changes or effects  with respect to AGT or its
subsidiaries which would have a Material Adverse Effect on AGT.

                  SECTION  6.3.   Conditions  to  the  Obligations  of  AGT  and
Acquisition.  The respective  obligations  of AGT and  Acquisition to effect the
Merger are subject to the  satisfaction at or prior to the Effective Time of the
following conditions:

                  (a)  the   representations   and  warranties  of  the  Company
contained in this Agreement or in any other document  delivered  pursuant hereto
shall be true and correct in all  material  respects at and as of the  Effective
Time with the same effect as if made at and as of the Effective Time, and at the
Closing the Company shall have delivered to AGT and Acquisition a certificate to
that effect;

                  (b) each of the  obligations of the Company to be performed at
or before the Effective Time pursuant to the terms of this Agreement  shall have
been duly performed in all material respects at or before the Effective Time and
at the  Closing  the  Company  shall have  delivered  to AGT and  Acquisition  a
certificate to that effect;

                  (c) the Dissenting  Shares shall  constitute not more than ten
percent (10%) of the Shares;

                  (d) the Company  shall have  delivered to AGT and  Acquisition
all consents or notices  necessary to effect valid  assignments of the contracts
listed on  Section  3.18 of the  Company  Disclosure  Schedule,  except  for the
contracts  indicated  thereon  with  an  asterisk,  all in  form  and  substance
reasonably acceptable to AGT;

                  (e) there shall have been no events,  changes or effects  with
respect to the Company or its  subsidiaries  which would have a Material Adverse
Effect on the Company;

                  (f) the  opinion  of Weil,  Gotshal  & Manges  LLP,  dated the
Closing  Date and  addressed  to AGT,  substantially  to the effect that (i) the
Merger  will be treated  for federal  income tax  purposes  as a  reorganization
within the meaning of Section 368(a) of the Code; (ii) each of AGT,  Acquisition
and the  Company  will be a party to the  reorganization  within the  meaning of
Section 368(b) of the Code; and (iii) no gain or loss will be recognized by AGT,
Acquisition or the Company as a result of the Merger,  shall have been delivered
and such  opinion  shall not have been  withdrawn  or modified  in any  material
respect.  In  rendering  such  opinion,  Weil,  Gotshal & Manges  LLP shall have
received and may rely upon the  representations  contained  in the  certificates
referred to in Section 5.12;

                  (g) employment agreements between Black Dot Graphics,  Inc., a
wholly-owned  subsidiary  of the  Company,  and each of Ettore G.  Nardulli  and
Howard A. Fiedler, each dated August 1, 1989, as amended, shall be in full force
and effect unless terminated due to death or disability (as defined therein).


                                    ARTICLE 7

                         TERMINATION; AMENDMENT; WAIVER

                  SECTION 7.1. Termination.  This Agreement may be terminated at
any time prior to the Effective Time:

                  (a) by  mutual  written consent of AGT, Acquisition  and the
Company;

                  (b) by AGT and  Acquisition  or the  Company if the Merger has
not been consummated by July 31, 1998, provided that no party may terminate this
Agreement pursuant to this Section 7.1(b) if such party's failure to fulfill any
of its  obligations  under this  Agreement  shall have been the reason  that the
Effective Time shall not have occurred on or before said date;

                  (c) by AGT and  Acquisition  or the Company if (i) the Company
shall  have  convened  a meeting  of its  stockholders  and failed to obtain the
requisite  vote to approve this  agreement  and the Merger,  (ii) AGT shall have
convened a meeting of its  stockholders  and failed to obtain the requisite vote
to approve the Share Issuance,  or (iii) the U.S.  Department of Justice or U.S.
Federal Trade  Commission shall have obtained or stated its intention in writing
to seek an order, preliminary or permanent injunction,  or other legal restraint
or prohibition preventing consummation of the Merger or any related transactions
contemplated by this Agreement.

                  (d) by the  Company  if (i) there  shall have been a breach of
any  representation  or warranty on the part of AGT or Acquisition  set forth in
this Agreement, or if any representation or warranty of AGT or Acquisition shall
have become untrue, in either case such that the conditions set forth in Section
6.2(a) would be  incapable of being  satisfied by July 31, 1998 (or as otherwise
extended),  (ii) there shall have been a breach by AGT or  Acquisition of any of
their  respective  covenants or agreements  hereunder  having or  constituting a
Material Adverse Effect on AGT or Acquisition, as the case may be, has not cured
such breach  within 15 days after  notice by the Company  thereof,  or (iii) the
Company enters into a definitive  agreement  relating to a Superior  Proposal in
accordance with Section 5.3(b),  so long as the Company is not then in breach of
its obligations  under Section 5.3 (provided that such termination  shall not be
effective until payment of the amount required under Section 7.3(a)); or

                  (e) by AGT and  Acquisition  if (i)  there  shall  have been a
breach of any representation or warranty on the part of the Company set forth in
this Agreement,  or if any  representation or warranty of the Company shall have
become  untrue,  in either  case such that the  conditions  set forth in Section
6.3(a) would be  incapable of being  satisfied by July 31, 1998 (or as otherwise
extended),  (ii) there shall have been a breach by the Company of its  covenants
or agreements  hereunder having or constituting a Material Adverse Effect on the
Company and the Company has not cured such breach within 15 days after notice by
AGT or  Acquisition  thereof or (iii) the Company  Board  shall have  withdrawn,
modified or changed its  approval or  recommendation  of this  Agreement  or the
Merger,  shall have  recommended to the Company's  stockholders  any Acquisition
Proposal  (other than the  Merger),  shall have failed to call,  give notice of,
convene or hold a stockholders'  meeting to vote upon the Merger,  or shall have
adopted any resolution to effect any of the foregoing, or the Company shall have
entered into a definitive agreement relating to a Superior Proposal.

                  SECTION  7.2.  Effect  of  Termination.  In the  event  of the
termination  of this  Agreement  pursuant to Section 7.1, this  Agreement  shall
forthwith  become void and have no effect,  without any liability on the part of
any party hereto or its affiliates,  directors, officers or shareholders,  other
than the provisions of this Section 7.2 and Sections 5.6(c) and 7.3, and nothing
contained in this  Section 7.2 shall  relieve any party from  liability  for any
breach of this Agreement prior to such termination.

                  SECTION 7.3.  Fees and Expenses.

                  (a)      In the event that this Agreement shall be terminated
pursuant to:

                           (i)     Sections 7.1(e)(i) or 7.1(e)(ii), and, within
twelve months  thereafter,  the Company enters into an agreement with respect to
any Acquisition Proposal (other than the Merger); or

                           (ii)     Sections 7.1(d)(iii) or 7.1(e)(iii),

                  then AGT and  Acquisition  would suffer direct and substantial
damages,  which  damages  cannot be determined  with  reasonable  certainty.  To
compensate AGT and  Acquisition  for such damages,  the Company shall pay to AGT
the amount of $13  million as  liquidated  damages and not a penalty as follows:
(i) in the case of a termination  under Sections  7.1(e)(i) or 7.1(e)(ii),  such
amount  shall be paid on the date the  Company  enters  into an  agreement  with
respect to any Acquisition  Proposal and (ii) in the case of a termination under
Section 7.1(d)(iii) or 7.1(e)(iii),  such amount shall be paid concurrently with
and, in the case of Section 7.1(d)(iii), as a precondition of, such termination.

                  (b)  Upon  the  termination  of  this  Agreement  pursuant  to
Sections 7.1(c)(i), 7.1(d)(iii), or 7.1(e)(iii), in addition to any amounts that
may otherwise be payable under Section 7.3(a),  the Company shall reimburse AGT,
Acquisition and their affiliates for all actual  documented  out-of-pocket  fees
and expenses,  not to exceed $3 million,  actually incurred by any of them or on
their  behalf  in  connection  with  the  Merger  and  the  consummation  of all
transactions contemplated by this Agreement (including, without limitation, fees
payable  to  investment   bankers,   counsel  to  any  of  the  foregoing,   and
accountants).  If AGT or  Acquisition  shall submit a request for  reimbursement
hereunder,  AGT or  Acquisition  will  provide  the  Company in due course  with
invoices or other reasonable evidence of such expenses upon request. The Company
shall in any event pay the amount (not to exceed $3 million)  within 10 business
days from when invoices are received by the Company.

                  (c) Upon the termination of this Agreement pursuant to Section
7.1(c)(ii),   AGT  shall  reimburse  the  Company  for  all  actual   documented
out-of-pocket fees and expenses, not to exceed $3 million,  actually incurred by
the Company or on its behalf in connection with the Merger and the  consummation
of  all  transactions   contemplated  by  this  Agreement  (including,   without
limitation, fees payable to investment bankers, counsel to any of the foregoing,
and  accountants).  If the  Company  shall  submit a request  for  reimbursement
hereunder,  the Company  will  provide AGT in due course with  invoices or other
reasonable  evidence of such expenses  upon request.  AGT shall in any event pay
the amount (not to exceed $3 million) within 10 business days from when invoices
are received by AGT.

                  (d) Except as specifically  provided in this Section 7.3, each
party shall bear its own  expenses in  connection  with this  Agreement  and the
transactions  contemplated  hereby.  The cost of printing  the S-4 and the Joint
Proxy Statement of filing any required  notification  under the HSR Act shall be
borne equally by the Company and AGT.

                  SECTION  7.4.  Amendment.  This  Agreement  may be  amended by
action taken by the  Company,  AGT and  Acquisition  at any time before or after
approval of the Merger by the  stockholders  of the Company and  stockholders of
AGT but, after any such approval,  no amendment shall be made which requires the
approval of such stockholders  under applicable law without such approval.  This
Agreement may not be amended except by an instrument in writing signed on behalf
of the parties hereto.

                  SECTION  7.5.  Extension;  Waiver.  At any  time  prior to the
Effective Time, each party hereto (for these purposes, AGT and Acquisition shall
together  be deemed one party and the Company  shall be deemed the other  party)
may (i) extend the time for the  performance of any of the  obligations or other
acts of the other party, (ii) waive any inaccuracies in the  representations and
warranties of the other party contained  herein or in any document,  certificate
or writing  delivered  pursuant  hereto or (iii) waive  compliance  by the other
party with any of the agreements or conditions  contained herein.  Any agreement
on the part of either  party  hereto to any such  extension  or waiver  shall be
valid only if set forth in an  instrument  in  writing  signed on behalf of such
party.  The failure of either party hereto to assert any of its rights hereunder
shall not constitute a waiver of such rights.


                                    ARTICLE 8

                                  MISCELLANEOUS

                  SECTION 8.1.  Nonsurvival of  Representations  and Warranties.
The  representations  and  warranties  made herein shall not survive  beyond the
Effective Time or a termination of this Agreement.

                  SECTION 8.2.  Entire Agreement; Assignment.  This Agreement:

                  (a) and the  Confidentially  Agreement  constitute  the entire
agreement  between the parties  hereto with respect to the subject matter hereof
and supersedes all other prior agreements and  understandings,  both written and
oral, between the parties with respect to the subject matter hereof; and

                  (b) shall not be assigned by  operation  of law or  otherwise;
provided,  however,  that  Acquisition  may  assign any or all of its rights and
obligations  under  this  Agreement  to  any  direct  or  indirect  wholly-owned
subsidiary  of AGT, but no such  assignment  shall  relieve  Acquisition  of its
obligations hereunder if such assignee does not perform such obligations.

                  SECTION 8.3. Notices. All notices,  requests,  claims, demands
and other  communications  hereunder shall be in writing and shall be given (and
shall be deemed to have been duly given upon receipt) by delivery in person,  by
cable, telegram, facsimile or telex, or by registered or certified mail (postage
prepaid, return receipt requested), to the other party as follows:

      if to AGT or                  Applied Graphics Technologies, Inc.
      to Acquisition to:            450 West 33rd Street
                                    New York, New York  10001
                                    Attention:        Martin D. Krall
                                                      Louis Salamone, Jr.
      with a copy to:               Weil, Gotshal & Manges LLP
                                    767 Fifth Avenue
                                    New York, NY  10153
                                    Attention:        Jeffrey J. Weinberg, Esq.
                                    Facsimile:        (212) 310-8007
      if to the Company to:         Devon Group, Inc.
                                    450 Park Avenue
                                    New York, New York  10022
                                    Attention:        Marne Obernauer, Jr.
      with a copy to:               O'Sullivan Graev & Karabell, LLP
                                    30 Rockefeller Plaza
                                    New York, NY  10112
                                    Attention:        Lawrence G. Graev, Esq.
                                    Facsimile:        (212) 408-2420

or to such  other  address  as the  person  to whom  notice  is  given  may have
previously furnished to the other in writing in the manner set forth above.

                  SECTION 8.4.  Governing Law. This Agreement  shall be governed
by and construed in accordance  with the laws of the State of Delaware,  without
regard to the principles of conflicts of law thereof.

                  SECTION 8.5.  Descriptive  Headings.  The descriptive headings
herein are inserted for convenience of reference only and are not intended to be
part of or to affect the meaning or interpretation of this Agreement.

                  SECTION 8.6.  Interpretive  Provisions;  Certain  Definitions.
Whenever  used  in  this  Agreement,  "to the  Company's  knowledge"  or "to the
knowledge of the Company"  shall mean the actual  knowledge of those persons who
are listed on Exhibit 1 and "to AGT's  knowledge"  or "to the  knowledge of AGT"
shall  mean the  actual  knowledge  of the  Persons  listed  on  Exhibit  2. The
inclusion  of any  information  on any schedule to this  Agreement  shall not be
deemed to be an admission or acknowledgement  by the Company,  in and of itself,
that such  information  is required to be listed on such Schedule or is material
to or outside  the  ordinary  course of the  business  of the  Company.  Nothing
contained  herein or in any of the exhibits or schedules hereto shall constitute
an admission of liability or an admission against the Company's interest.

                  SECTION 8.7.  Parties in  Interest.  This  Agreement  shall be
binding  upon and inure  solely to the  benefit  of each  party  hereto  and its
successors  and permitted  assigns,  and except as provided in Sections 5.10 and
8.2  nothing in this  Agreement,  express or  implied,  is  intended to or shall
confer  upon any other  person any  rights,  benefits  or remedies of any nature
whatsoever under or by reason of this Agreement.

                  SECTION 8.8.  Severability.  If any term or other provision of
this Agreement is invalid,  illegal or  unenforceable,  all other  provisions of
this Agreement  shall remain in full force and effect so long as the economic or
legal substance of the transactions  contemplated  hereby is not affected in any
manner materially adverse to any party.

                  SECTION  8.9.   Specific   Performance.   The  parties  hereto
acknowledge  that  irreparable  damage would result if this  Agreement  were not
specifically   enforced,   and  they  therefore  consent  that  the  rights  and
obligations  of the parties under this  Agreement may be enforced by a decree of
specific  performance issued by a court of competent  jurisdiction.  Such remedy
shall, however, not be exclusive and, shall be in addition to any other remedies
which any party may have under this Agreement or otherwise.

                  SECTION 8.10. Brokers. Except as otherwise provided in Section
7.3, the Company agrees to indemnify and hold harmless AGT and Acquisition,  and
AGT and Acquisition  agree to indemnify and hold harmless the Company,  from and
against any and all liability to which AGT and Acquisition,  on the one hand, or
the  Company,  on the other hand,  may be  subjected  by reason of any  brokers,
finder's  or  similar  fees  or  expenses  with  respect  to  the   transactions
contemplated  by this Agreement to the extent such similar fees and expenses are
attributable to any action undertaken by or on behalf of the Company,  or AGT or
Acquisition, as the case may be.

                  SECTION 8.11. Counterparts.  This Agreement may be executed in
one or more counterparts,  each of which shall be deemed to be an original,  but
all of which shall constitute one and the same agreement.



<PAGE>



                   IN WITNESS  WHEREOF,  each of the  parties  has  caused  this
Agreement  to be duly  executed on its behalf as of the day and year first above
written.
                                     APPLIED GRAPHICS TECHNOLOGIES, INC.


                                     By:
                                     Name:    Fred Drasner
                                     Title:   Chief Executive Officer


                                     AGT ACQUISITION CORP.


                                     By:
                                     Name:    Fred Drasner
                                     Title:   Chief Executive Officer


                                     DEVON GROUP, INC.


                                     By:
                                     Name:    Marne Obernauer, Jr.
                                     Title:   Chief Executive Officer




<PAGE>





                                                         Exhibit 1



Marne Obernauer, Jr.

Bruce K. Koch

Robert H. Donovan

Robert A. Frasco



<PAGE>


                                                   Exhibit 2



Fred Drasner

Martin D. Krall

Louis Salamone, Jr.



<PAGE>