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                          STRATEGIC ALLIANCE AGREEMENT

                                     BETWEEN


1. Instron Corporation, 100 Royall Street, Canton, Massachusetts 02021,
                                      - hereinafter called "Instron Corp." -

2. Instron Partners, 100 Royall Street, Canton, Massachusetts 02021, 
                                      - hereinafter called "IP" -

3. Instron GmbH, Industriestrasse 19, 67063 Ludwigshafen am Rhein,
                                      - hereinafter called "Instron GmbH" -

4. Instron Schenck Testing Systems GmbH, LandwehrstraBe 55, 65273 Darmstadt, 
                                      - hereinafter called "GmbH"

5. Instron Schenck Testing Systems, a Delaware general Partnership, 
                                      - hereinafter called "Partnership"

-  Instron Corp., IP and Instron GmbH are also jointly referred to as 
   "Instron" -

                                       AND

6. Carl Schenck AG, Landwehrstrasse 55, Darmstadt,
                                      -  hereinafter called "Schenck AG" -

7. Schenck Atis GmbH, Landwehrstrasse 55, Darmstadt,
                                      - hereinafter called "Schenck Atis" -

8. Schenck Pegasus Testing Inc., 535 Acorm Street, Deer Park, N. Y. 
   11729-3 69 8, USA,
                                      - hereinafter called "SPT" -

9. Schenck Fertigungs GmbH, Landwehrstrasse 55, Darmstadt,
                                      - hereinafter called "Schenck Fertigung" -

-  Schenck AG, Schenck Atis and SPT are also jointly referred to as "Schenck" -




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1.   CURRENT STATUS

     1.1  By notarial deed dated November 14, 1996 of the notary public Dr. P.
          Schmidt zur Nedden in Frankfurt/Main (A.Prot. 1996/574) (the "Deed
          1"), Instron Corporation ("Instron Corp."), Carl Schenck AG ("Schenck
          AG") and other parties have entered into a Joint Venture Agreement
          ("JVA") on the formation of a Joint Venture reflected in joint
          ownership of a German GmbH with the name Instron Schenck Testing
          Systems GmbH and a US partnership with the name Instron Schenck
          Testing Systems.

     1.2  By notarial deed dated November 14, 1996 of the notary public Dr. P.
          Schmidt zur Nedden in Frankfart/Main (A. Prot. 1996/573) Instron
          Corp., Schenck AG and other parties have entered into an Asset
          Purchase Agreement on the Sale of the Servohydraulic Machine Business
          from Schenck Atis to Instron Limited, a subsidiary of Instron Corp.

     1.3  Instron GmbH and IP desire to purchase the shares and interests of
          Schenck Atis and SPT in the GmbH and the Partnership irrespective of
          the terms of the JVA but subject to the terms and conditions contained
          herein. Simultaneously, the parties intend to terminate the JVA.

2.   SALE AND TRANSFER OF QUOTAS AND INTERESTS

     Instron GmbH and EP on the one hand and Schenck Atis and SPT on the other
     hand hereby enter into the Sale Agreement attached hereto as EXHIBIT 2,
     pursuant to which Schenck Atis and SPT sell to Instron GmbH and IP as of
     the date hereof and transfer to the Instron GmbH and IP, as of the
     Effective Date; all its interests in the GmbH and the Partnership, subject
     to the terms contained herein.

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3.   NAME LICENSE

     3.1  For a transition period of 3 years from the Effective Date Schenck AG,
          Schenck Atis and SPT hereby grant the GmbH and the Partnership the
          right to use the name and mark "Schenck" in accordance with past
          practice, whether as part of their corporate or trade name or for use
          as a logo or otherwise in connection with the company's business and
          products of structural testing, including in brochures, leaflets and
          otherwise as usual in the Business in accordance with past practices.
          The license shall be royalty-free, non-exclusive and shall not be
          transferable. The GmbH and Partnership shall not have a right to
          sublicense the license. Upon terminate of such license, GmbH and the
          Partnership shall cease using the licensed name and mark as part of
          its corporate names and in any newly printed brochures, leaflets or
          other materials; existing brochures, leaflets or other materials may
          be used for a period of 18 months from termination of the license set
          out herein.

     3.2  The GmbH and the Partnership shall have an option to renew the license
          by written notice to Schenck AG for two additional one year periods,
          in each case in consideration of a lump sum license fee of 100.000,-
          per year of extension. Such license fee shall be payable not later
          than three business days from beginning of the extension period for
          which such fee becomes due. The option must be exercised not less than
          two months before the expiration of the relevant license period.

     3.3  Prior to the date referred to in Sections 3.1 and 3.2, Schenck shall
          only be entitled to terminate the license for cause (aus wichtigem
          Grund) subject to a two months notice period, and not to the extent
          that the licensees have taken appropriate action to remedy the reason
          for termination, and only if the continuation of the license can not
          be reasonably requested from Schenck (die Fortsetzung der Lizenz ist
          nicht mehr zumutbar).

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     3.4  The GmbH and Partnership shall promptly notify Schenck in the event
          that it becomes aware of any third party infringements of Schencles
          name rights with respect to the term "Schenck".

4.   OTHER AGREEMENTS

     4.1  The Contract Manufacturing and Supply Agreement between Schenck
          Fertigung and GmbH dated as of November 17, 1996 attached to the JVA
          as EXHIBIT 11.2.1 (the CMSA 1") and the Contract Manufacturing and
          Supply Agreement dated as of November 17, 1996 between Schenck Pegasus
          and the Partnership attached to the JVA as EXHIBIT 11.2.2 (the CMSA
          2") will be continued. Effective as of the Effective Date, Section
          4.1.2 of the CMSA 1 and Sec. 4.1 of the CMSA 2 will be amended to read
          as follows:

          "The price to be paid for Components delivered hereunder on or after
          September 27, 1998 shall be the price quoted by the supplying party
          which price shall be the price quoted by the supplying party, but
          which price shall not exceed 110% of the sum of the Manufacturing Cost
          plus the Other Cost of the Components."

     Sec. 4.1.2 of the CMSA I shall further be amended by the following 
     language:

          "Capitalized terms used herein and not defined herein shall have the
          meaning ascribed to them in the Contract Manufacturing and Supply
          Agreement of November 17, 1996 between Schenck Pegasus Corporation and
          Instron Schenck Testing Systems."

     4.2  The lease agreement between Schenck. Immobilien & Service GmbH
          (formerly: Schenck GmbH + Co. Immobilien & Service KG and GmbH)
          attached to the JVA as EXHIBIT 10.1, as amended on March 31, 1998,
          shall be further amended as follows:

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         (i)   Instron Wolpert GmbH ("Wolpert") will become a party to the lease
               agreement. 

         (ii)  Wolpert will lease the space at the Schenck premises in
               Darmstadt, Landwehrstrasse 55, marked in EXHIBIT 4.2 (1) hereto.

         (iii) The lease payment for such space will be as set out in EXHIBIT
               4.2 (iv) (2) hereto.

          Instron Corp and Schenck AG will cause QmbH, Wolpert and Schenck
          Immobilien & Service GmbH to amend the lease agreement accordingly
          effective as of October 1, 1998.

     4.3  The Support Services Agreement between Schenck AG and GmbH of November
          14, 1996 attached to the JVA as EXHIBIT 11.1.1 shall be continued.

     4.4  The License Agreement between the Partnership, Schenck Pegasus, and
          Schenck AG dated as of November 17, 1996 attached to the JVA as
          EXHIBIT 15 shall be continued.

     4.5  Effective as of the Effective Date all other Agreements attached to
          the JVA shall be terminated. These are the following agreements:

         (i)   Research and Development Agreement between Schenck AG and GmbH
               and the Partnership dated as of November 14, 1996

         (ii)  After Sales Service Agreement between Schenck AG and GmbH and the
               Partnership dated as of November 17, 1996

         (iii) Finder's Fee and Commission Sales Agreement between Schenck AG
               and GmbH and the Partnership dated as of November 17, 1996

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         (iv)  Preferred Supplier and Joint Sales Agreement between GmbH and the
               Partnership and Schenck AG dated as of November 17, 1996

         (v)   Support Services Agreement between Schenck Pegasus and the
               Partnership dated as of November 14, 1996

         (vi)  Finder's Fee Agreement between Instron Limited and Schenck AG
               dated as of November 17, 1996

     4.6  The parties agree that Schenck and its affiliates, GmbH, the
          Partnership and Instron Corp. and its affiliates are hereby released
          from any and all obligations and liabilities arising under, out of or
          in connection with the agreements terminated pursuant to Section 4.5.

5.   TERMINATION OF JVA AND RELEASE

     5.1  The parties agree that the JVA is terminated and that both Schenck and
          its affiliates and Instron Corp. and its affiliates are hereby
          released from any and all obligations and liabilities arising under,
          out of or in connection with the JVA, except for (i) obligations and
          liabilities under those agreements which will be continued pursuant to
          Section 4 hereof and (ii) obligations and liabilities under Section 32
          and 34 of the JVA.

     5.2  Schenck AG will ensure, and will cause its affiliates to ensure, that
          any board members of GmbH, the Partnership or any of their
          subsidiaries appointed by Schenck AG or any of its affiliates, or
          elected upon their proposal for election by Schenck AG or any of its
          affiliates, will resign on or immediately after the Effective Date.
          Instron Corp. will cause these board members to be discharged
          (entlastet) by appropriate corporate action without undue delay
          thereafter.

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5.3               Instron Corp. will, and will cause its affiliates to, grant
                  Schenck AG and its affiliates reasonable access to the books
                  and records of GmbH and the Partnership to the extent
                  reasonably required by the Schenck AG and its affiliates (i)
                  in order to be able to comply with reporting obligations
                  imposed by applicable law or (ii) in connection with tax or
                  similar audits of the party requesting access. Schenck AG
                  will, and will cause its affiliates to, grant GmbH, the
                  Partnership, Instron. Corp. and its affiliates reasonable
                  access to the books and records of Schenck AG and its
                  affiliates to the extent reasonably required by GmbH, the
                  Partnership, Instron Corp. and its affiliates (i) in order to
                  be able to comply with reporting obligations imposed by
                  applicable law or (ii) in connection with tax or similar
                  audits of the party requesting access.

5.4               Any claims relating to legal defects (Rechtsmangel) which GmbH
                  and the Partnership may have against Schenck AG or any of its
                  affiliates under Sections 7.3 and 7.4 of the German Schenck
                  Contribution Agreement and the U.S. Schenck Contribution
                  Agreement (as defined in the JVA) and any mutual claims under
                  Section 3.2 of the German Schenck Contribution Agreement and
                  under Section 3.3 of the U.S. Schenck Contribution Agreement
                  shall remain unaffected.

6.   EFFECTIVE DATE

     The Effective Date within the meaning of this Agreement shall be September
     27, 1998.

7.   COSTS AND FEES

     7.1  The fees for the notarization of this Agreement shall be born equally
          by Schenck AG and Instron Corporation.

     7.2  Each party shall bear its own professional advisers' fees and other
          costs.



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8.   MISCELLANEOUS

     8.1  Amendments and modifications of this Agreement (including this clause)
          must be made in written or in notarial form, if such form is required.

     8.2  All notices and other notifications pursuant to or in connection with
          this Agreement must be made in writing and must be hand delivered or
          sent by registered mail or by telecopy (with a confirmation copy to
          follow by mail) to the following address(es) or to the addresses which
          the respective party shall notify to the other in writing:

          to any Instron party:
          Instron Corporation
          100 Royall Street
          Canton, MA 02021
          U.S.A.

          Attn.: John Barrett
          Fax No.: (001) 781-821-2487

          To any Schenck party:
          Carl Schenck AG
          Landwehrstrasse 55
          D-64293 Darmstadt
          Federal Republic of Germany

          Attn.: Legal Department
          Fax No.: 06151-32 39 05

          With copy to:
          Schenck Corporation
          535 Acorn Street
          Deer Park, NY 11729-3698

          Attn.: Blaise Sarcone
          Fax No.: (001) 516-242-4308


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     8.3  The partial or total invalidity of, or the impossibility to perform,
          individual provisions of this Agreement shall not impair the validity
          of the other provisions of the Agreement. The parties undertake to
          replace a provision that is or has become invalid in whole or in part
          by a valid provision, the economic result of which comes as close as
          possible to that, of the invalid provision. In the event that the
          Agreement does not deal with certain issues or certain provisions are
          impossible to be performed, the same procedure shall apply.

     8.4  The parties undertake to take all actions and make declarations that
          are necessary and suitable to achieve the consummation of this
          Agreement. This shall apply in, particular to declarations to the
          Commercial Registers and the financial authorities.

     8.5  Headings are inserted for convenience only, are not part of this
          Agreement and shall not modify the content of any provisions of this
          Agreement.

     8.6  Rights and obligations arising from this Agreement shall not be
          assignable by any party without prior written consent of the other
          party.

     8.7  As from the date on which the CMSA 1 terminates this Agreement shall
          no longer be referred to as the "Strategic Alliance Agreement" but
          only as the "Umbrella Agreement".

     8.8  This Agreement shall be governed by the laws of the Federal Republic
          of Germany (with the exception of the provisions relating to the
          conflict of laws).

     8.9  The courts of Frankfurt am Main shall have exclusive jurisdiction with
          respect to all disputes arising out of or in connection with this
          Agreement.



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INSTRON CORPORATION

By: /s/ John Barrett                              
    ---------------------------------
    John Barrett, Treasurer

INSTRON PARTNERS

By: /s/ John Barrett                              
    ---------------------------------
    John Barrett, Treasurer

INSTRON GMBH

By: /s/ John Barrett                              
    ---------------------------------
    John Barrett, Treasurer

INSTRON SCHENCK TESTING SYSTEMS GMBH

By: /s/ John Barrett                              
    ---------------------------------
    John Barrett, Treasurer

INSTRON SCHENCK TESTING SYSTEMS

By: /s/ John Barrett                              
    ---------------------------------
    John Barrett, Treasurer

CARL SCHENCK AG

By: /s/ Jan Wittstock                          By: /s/ Andreas Birk          
    ---------------------------------              -----------------------------


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    Jan Wittstock, Financial Director              Legal Counsel to Schenck

SCHENCK ATIS GMBH

By: /s/      Jan Wittstock                     By:      /s/ Andreas Birk
    ---------------------------------              -----------------------------
    Jan Wittstock, Financial Director              Legal Counsel to Schenck

SCHENCK PEGASUS TESTING INC.

By: /s/    Jan Wittstock                       By: /s/     Andreas Birk      
    ---------------------------------              -----------------------------
    Jan Wittstock, Financial Director              Legal Counsel to Schenck

SCHENCK FERTIGUNGS GMBH

By: /s/    Jan Wittstock                       By: /s/     Andreas Birk      
    ---------------------------------              -----------------------------
    Jan Wittstock, Financial Director              Legal Counsel to Schenck




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