AGREEMENT FOR THE PURCHASE AND SALE OF ASSETS


  THIS  AGREEMENT  is made as of this 8th day of August,  1996,  by and  between
Dahlstrom  Industries,  Inc.,  an  Illinois  corporation  located at 9508 Winona
Avenue, Schiller Park, Illinois 60176 ("Seller"),  and Formtek, Inc., a Delaware
corporation  with offices located at 260 North Elm Street,  Westfield,  MA 01085
("Purchaser").

                                   RECITALS

A. Seller is the owner of certain assets  including  real  property,  machinery,
equipment,  and other tangible personal  property,  inventory,  work-in-process,
rights under agreements,  accounts or notes receivable,  intellectual  property,
permits,  goodwill and other books, records,  information and materials required
or  appropriate  for the  continued  operation  of that  certain  business  that
manufactures   and   sells   machinery   and   equipment   for   roll   forming,
cutting-to-length,  and wing forming, Gripall material handling, automated metal
fabricating  systems  and the repair and  service  parts  related  thereof  (the
"Dahlstrom Business").

B.  Seller  desires  and  intends to sell and  transfer  the assets and  certain
liabilities associated with the Dahlstrom Business of Seller to Purchaser at the
price and on the terms and conditions hereinafter set forth.

C.  Purchaser  desires  and intends to  purchase  the assets and assume  certain
liabilities of Seller associated with the Dahlstrom Business at the price and on
the terms and conditions hereinafter set forth.

                           AGREEMENTS

NOW,  THEREFORE,  in  consideration  of the terms  hereof,  the parties  hereto,
intending to be legally bound hereby, agree as follows:

1.  Purchase and Sale of Assets

    1.1 The Assets. Upon the closing of the transactions contemplated under this
Agreement  on August 30,  1996,  or such other  date as  mutually  agreed by the
parties (the "Closing Date"), and subject to the terms and conditions  contained
in this Agreement,  Seller shall sell, transfer,  convey,  assign and deliver to
Purchaser,  and Purchaser shall purchase,  acquire and accept from Seller,  free
and clear of all liens,  encumbrances,  restrictions  and adverse charges of any
nature whatsoever, except as may be permitted by Section 7.7, all of the assets,
rights, interests,  properties and goodwill of every nature whatsoever, tangible
or  intangible  and  wheresoever  situated,  required  or  appropriate  for  the
continued  operation of the Dahlstrom  Business which is further  defined as the
manufacture,  application,  design, development,  engineering,  distribution and
sale of various  models and types of machinery  and  equipment  for the feeding,
straightening,   forming,  bending,  notching,   welding,  stacking,  and  other
activities  involved  in  automated  fabricating  systems,  and  the  parts  and
accessories  related  thereto set forth by model number in Schedule 1.1 attached
hereto.   The  assets,   rights,   interests,   properties  and  goodwill  sold,
transferred,  conveyed,  assigned and delivered by Seller to Purchaser hereunder
(collectively,  the  "Assets")  shall  include,  but shall not be limited to the
following:

         1.1.1 Machinery & Equipment.  All of the machinery,  equipment,  office
equipment,  furniture,  furnishings,  fixtures,  jigs, dies, tooling,  patterns,
tooling fixtures,  trucks, motor vehicles and all other fixed tangible assets of
Seller used in the  Dahlstrom  Business  identified in Schedule  1.1.1  attached
hereto (the "Machinery & Equipment"),  together with any rights of Seller to all
warranties,   if  any,  and  to  the  extent   assignable,   received  from  the
manufacturers and sellers of such items;

         1.1.2  Inventory.  All saleable,  usable,  undamaged,  non-obsolete and
non-slow-moving inventory of Seller relating to the Dahlstrom Business including
raw  materials,  work-in-process,  and finished  goods (the  "Inventory")  to be
physically  counted by the  parties  on August  30,  1996,  (and  thereafter  as
necessary  until the count is  completed),  listed,  valued and attached to this
Agreement thereafter as Schedule 1.1.2;

         1.1.3  Material  Agreements.  Subject  to  required  consents  by third
parties,  all right, title and interest of Seller in, to and under those certain
executory contracts (including the right to the return of any and all deposits),
contract  rights  and  agreements  including  sales  purchase  orders to provide
equipment,  repair  parts  and  services  to  the  customers  of  Seller,  sales
representative  agreements,  leases of personal property,  licenses, service and
maintenance agreements,  vendor purchase orders, and other agreements related to
the ownership or operation of the Dahlstrom  Business  expressly  identified and
listed by Purchaser and copies of which  agreements  are attached as exhibits in
Schedule 1.1.3 attached hereto (the "Material Agreements");

         1.1.4  Intellectual   Property.   All  patents,   patent  applications,
trademarks,  trademark applications,  service marks, tradenames,  copyrights and
copyright applications,  and licenses with respect to any of the foregoing,  all
inventions,  inventor's notes,  discoveries,  trade secrets, ideas,  proprietary
processes and formulae,  whether  patentable or not,  improvements,  engineering
drawings,  computer-assisted  design and manufacturing  data, bills of material,
designs and  specifications  (including  design choices),  computer software and
laboratory  certifications,  proprietary  and trade  rights and data,  ideas and
know-how,  whether patentable or not, and all shop rights,  manufacturing  data,
licenses, and other intellectual property and all correspondence related thereto
of Seller that are used or could be used in the Dahlstrom Business (all of which
are hereinafter collectively referred to as the "Intellectual Property");

         1.1.5     Receivables.  All cash, accounts or notes
receivable, prepaid expenses and contract rights of Seller as of
the Closing Date, including those identified in Schedule 1.1.5
attached hereto (the "Receivables");



<PAGE>


         1.1.6     Real Property.  The improved real estate commonly
known as 9508 Winona Avenue, Schiller Park, Illinois and legally
described as set forth in Schedule 1.1.6 attached hereto (the
"Real Property");

         1.1.7 Permits.  All of Seller's right, title and interest in and to any
and all permits,  licenses,  authorizations,  certifications,  consents, orders,
registrations and approvals of any federal,  state or local governmental  entity
or certifying or regulatory agency or authority  required of Seller or otherwise
necessary or advisable for the operation of the Dahlstrom  Business as set forth
on Schedule  1.1.7  attached  hereto (the  "Permits") to the extent the same are
transferable or assignable to Purchaser;

         1.1.8 Books and Records.  All of Seller's right,  title and interest in
or to all books of  account,  records,  files and  invoices,  including  but not
limited to technical and scientific literature, all invoice files kept by serial
number,  model or customer and  correspondence  related thereto,  all production
data,  testing  data,  equipment   maintenance  data,  employee  files,  payroll
information system, accounting records,  inventory records,  purchasing records,
engineering records,  sales and sales promotional data,  advertising  materials,
customer lists and customer  data,  cost and pricing  information,  supplier and
vendor lists,  installation  and maintenance  manuals,  business  plans,  supply
reference  catalogs and any other records and data used in  connection  with the
Dahlstrom Business (whether in computer  software,  data or any other form) (the
"Books  and  Records")  other  than the  corporate  minute  book and  records of
shareholder and director action by Seller; and

         1.1.9     Goodwill.  The goodwill associated with the
Dahlstrom Business (the "Goodwill").

    1.2 Conveyance of Assets.  The sale,  transfer,  conveyance,  assignment and
delivery  of the  Assets  provided  for in this  Article  1 shall be made by the
following  documentation  as  appropriate  (i) a duly  executed  bill  of  sale,
evidencing the warranty  provisions of this Agreement,  and substantially in the
form of Exhibit 1.2A attached hereto (the "Bill of Sale"),  (ii) a duly executed
statutory warranty deed transferring the Real Property substantially in the form
of Exhibit  1.2B  attached  hereto  (the  "Deed")  and (iii) such other good and
sufficient  instruments  of  conveyance  and  transfer  as shall  be  reasonably
necessary  to vest in  Purchaser as of the Closing Date full title to the Assets
being sold, transferred, conveyed, assigned and delivered hereunder.

    1.3 Off-Site Assets. All tangible Assets held at any location other than the
facility  of  Seller  are  described  at the  Closing  Date will be set forth in
Schedule 1.3 attached to this  Agreement at Closing  which  schedule  includes a
description of each of such assets, its type, the name and address of the vendor
or  customer  holding  such  assets  and,  if such asset is held  pursuant to an
agreement,  a copy or description of such agreement is attached as an exhibit to
the schedule.

2.  Excluded Assets.  The assets excluded from this Agreement
(the "Excluded Assets") are set forth in Schedule 2.0 attached
hereto ("Excluded Assets").

3.  Purchase Price

    3.1  Purchase  Price.  The  purchase  price  payable  to Seller  under  this
Agreement for the Assets by Purchaser shall be Two Million One Hundred  Thousand
and 00/100 Dollars  ($2,100,000.00)  (the "Purchase Price"),  subject to the net
worth adjustment set forth in Section 3.2 of this Agreement.

    3.2 Net Worth  Adjustment  of Purchase  Price.  The Purchase  Price shall be
adjusted  dollar-for-dollar  for any reduction in, or increase in, the net worth
of Seller between (i) the net worth amount of One Million Six Hundred  Sixty-six
Thousand Four Hundred  Forty-three and 00/100ths  Dollars  ($1,666,443.00)  (the
"Net Worth  Target")  and (ii) the net worth of Seller as at the Closing Date as
determined in accordance  with the  principles set forth  hereinafter  (the "Net
Worth Determination").

         3.2.1 Within 20 days after the Closing  Date, or such other time period
as agreed by the parties,  Purchaser  and Seller shall use their best efforts to
value the  physical  count of the  Inventory to be taken  immediately  after the
Closing  Date.  Within  thirty (30) days after the Closing  Date,  Purchaser and
Seller  shall work  together  making such  personnel  and records  available  as
necessary  to complete a balance  sheet for Seller as at the Closing Date and to
finalize the Net Worth Determination in good faith at their earliest convenience
based  upon the  principles  and  standards  set  forth in  Section  3.2.2,  the
representations  and warranties set forth in Sections 7.4, 7.5, 7.12 and 7.15 of
the Agreement and the  covenants of Seller set forth in Sections  10.4,  10.5.2,
10.6, 10.10 and 22.8 of this Agreement.  The final Net Worth  Determination  and
the  calculation  of the  adjustments  to the  Purchase  Price,  subject to such
offsets  by  Purchaser  against  amounts  payable by Seller to  Purchaser  under
Article 16 hereof,  if any, shall be set forth in a memorandum of  understanding
prepared and executed by the  authorized  representative  of each of the parties
and  delivered  to the Escrow  Agent (as  defined  below)  (the  "Memorandum  of
Understanding")  who  then  shall  make  the  appropriate   disbursements.   Any
additional   amount  due  and  owing  to  Seller   pursuant  to  the  Net  Worth
Determination  shall  be paid in cash by  wire  transfer  or  other  immediately
available  funds to Seller within ten (10) business days of the execution of the
Memorandum of Understanding.

         3.2.2 For purposes of the Net Worth Determination under this Agreement,
the following shall apply:

                (A) The  actual  assets  and  liabilities  of  Seller  shall  be
calculated  as at  the  Closing  Date  in  accordance  with  generally  accepted
accounting principles ("GAAP")  consistently applied,  except to the extent that
other provisions of this Section 3.2 provide otherwise;

               (B) The Real  Property,  Intellectual  Property  and  Machinery &
Equipment  by  agreement  of the parties  shall be valued at One  Million  Seven
Hundred  Twenty-five  Thousand Four Hundred  Eighty-Two  and  00/100ths  Dollars
($1,725,482.00);

                (C) The Inventory as counted at the Closing Date shall be valued
as set forth in Section 7.15 of this Agreement;
                 (D)  The value of the Receivables shall be valued as
set forth in Section 7.12 of this Agreement; and

                 (E) The liabilities of Seller shall be those that are expressly
assumed by Purchaser pursuant to Article 5 of this Agreement.

    3.3 Payment of Purchase Price. On the Closing Date,  Purchaser shall deliver
in cash by wire transfer or other immediately  available funds (a) to Seller the
amount  of  One  Million   Three   Hundred   Thousand  and   00/100ths   Dollars
($1,300,000.00) and (b) to Escrow Agent the amount of Three Hundred Thousand and
00/100ths  Dollars  ($300,000.00)  (the  "Short-Term  Escrow Amount") and (c) to
Escrow  Agent  the  amount  of  Five  Hundred  Thousand  and  00/100ths  Dollars
($500,000.00) (the "Long-term Escrow Amount").

    3.4 Escrow and Disbursement  Agreements.  The Short-Term Escrow Amount shall
be received,  held and  disbursed  according to the terms and  conditions  of an
escrow and  disbursement  agreement  substantially  in the form of Exhibit  3.4A
attached hereto (the "Short-term Escrow Agreement") among Seller,  Purchaser and
Chicago Title  Insurance  Company (the "Escrow  Agent").  The  Long-term  Escrow
Amount  shall be  received,  held  and  disbursed  according  to the  terms  and
conditions of an escrow and disbursement agreement  substantially in the form of
Exhibit 3.4B attached hereto (the "Long-term  Escrow  Agreement")  among Seller,
Purchaser and Escrow Agent.

4.  Allocation of Purchase  Price.  The Purchase Price shall be allocated by the
parties  hereto  among the  Assets as set forth in a  memorandum  of  allocation
delivered  on the Closing  Date  substantially  in the form  attached  hereto as
Exhibit 4.0 (the "Memorandum of Allocation").  Notwithstanding any allocation by
the parties,  Purchaser has agreed to purchase and Seller has agreed to sell the
Assets, and the allocation is not intended and shall not be deemed to constitute
an  agreement  between  the  parties to  transfer  less than all of the  Assets.
Furthermore,  such  allocation has been made solely to ascribe fair value to the
Assets and any benefits  deriving  therefrom  shall not inure to any other third
party.

5.  Assumption of Liabilities

    Upon the Closing  Date,  Purchaser  shall assume or discharge  the following
liabilities of Seller:

    5.1  Assumed Liabilities.  Those trade accounts payables,
customer deposits, that certain secured bank debt and other
obligations of Seller as specifically set forth by Purchaser in
Schedule 5.1 attached hereto as they exist as of the Closing
Date; and

     5.2 Assumption of Material  Agreements.  The obligations and liabilities of
Seller with respect to the  assignment  to Purchaser of the Material  Agreements
described in Section 1.1.3 and listed on Schedule 1.1.3.



<PAGE>


     5.3 Limits on  Assumption.  Except for the  assumptions  or  discharges  of
liabilities  described in Sections 5.1 and 5.2,  Purchaser  shall not assume (a)
other  liabilities,  obligations  and  commitments  of Seller,  whether fixed or
contingent,  legal or equitable, mature or inchoate, written or oral, express or
implied, known or unknown, including, but not limited to those related to taxes,
employment  practices,  employee  benefits  and  pensions,  implied  warranties,
products  or  professional  liability,  and  environmental,  health  and  safety
obligations  all as related to, arising from or in connection with the Dahlstrom
Business  for  products  manufactured  and  services  performed on or before the
Closing Date and (b) those  liabilities,  obligations  and commitments of Seller
that arise after the Closing Date, and the indemnification  provisions contained
in Article 16 of this Agreement  shall apply to any liability of Seller which is
not assumed by Purchaser and which is asserted or claimed by any person  against
Purchaser.

     5.4  Assignment of Contracts and Rights.  Notwithstanding  anything in this
Agreement to the contrary,  this Agreement  shall not constitute an agreement to
assign any particular Material Agreement or any claim, contract, license, lease,
commitment,  sales  order,  purchase  order or any claim or right or any benefit
arising thereunder or resulting  therefrom if the agreement to assign or attempt
to assign,  without  the consent of a third  party,  would  constitute  a breach
thereof  or in any way  adversely  affect  the  rights  of  Purchaser  or Seller
thereunder.  Until  such  consent is  obtained,  or if an  attempted  assignment
thereof would be ineffective or would affect the rights of Seller  thereunder so
that the  Purchaser  would not in fact  receive all such rights,  Purchaser  and
Seller will cooperate with each other in any arrangement designed to provide for
Purchaser  the  benefits  of,  and to permit  Purchaser  to  assume,  insofar as
expressly set forth herein, the stated liabilities under the particular Material
Agreement(s)  including  enforcement  at the  request  and  expense  and for the
benefit  of  Purchaser  of any and all  rights of Seller  against a third  party
thereto arising out of the breach or cancellation thereof by such third party or
otherwise.  Any transfer or assignment to Purchaser by Seller of any property or
property  rights or any contract or agreement which shall require the consent or
approval of any third party  shall be made  subject to such  consent or approval
being obtained.

6.  Covenant Against Competition

    6.1 Covenant Not to Compete. Seller covenants and agrees that neither it nor
its  affiliates  shall at any time within the three (3) year period  immediately
following the Closing Date (a) compete,  directly or indirectly,  with Purchaser
or (b)  have any  ownership  interest  in any  firm,  corporation,  partnership,
proprietorship  or  other  business  that  engages  with  third  parties  in the
activities now engaged in and in the territory served by the Dahlstrom Business,
so long as Purchaser or any affiliate or successor  thereof,  remains engaged in
the Dahlstrom  Business;  provided,  however,  that Seller may own,  directly or
indirectly,  solely  as an  investment,  securities,  or any  entity  which  are
publicly  traded if Seller does not,  directly or  indirectly,  own five percent
(5%) or more of any class of securities of any such competitive entity.

    6.2 Remedies.  Without waiving the Purchaser's  rights to monetary  damages,
all parties to this  Agreement  acknowledge  that the breach of the  obligations
contained in this Article 6 would result in substantial but indeterminable  harm
to  Purchaser,  that the  restraints  imposed are  reasonable,  that there is no
adequate  remedy at law for a breach  of such  obligations,  and that  therefore
injunctive  relief,   specific  performance  or  other  equitable  remedies  are
appropriate  to enforce the  obligations  undertaken  in this  Article 6. In the
event that a court finds that the term, territory, or scope of this Article 6 is
too  broad  to be  enforceable,  Seller  and  Purchaser  further  agree  that  a
reformation  of the  terms  of this  Article  6 is  appropriate  and  should  be
undertaken  by the  court in order to  protect  the  value of the  Assets  being
conveyed  pursuant to this Agreement as a going concern,  and to provide for the
enforceability  of the  obligations  contained  in this Article 6 to the fullest
extent allowed by law and equity.

7.  Representations and Warranties of Seller

    Seller  represents  and  warrants to  Purchaser  as of the  Closing  Date as
follows:

    7.1 Corporate  Existence.  Seller is a corporation  duly organized,  validly
existing  and in good  standing  under  the laws of the State of  Illinois,  and
Seller knows of no violation of the  requirement  for good standing in any other
jurisdiction  in which it is required to be qualified to carry on the  Dahlstrom
Business.  Seller  has  full  corporate  power  and  authority  to  carry on the
Dahlstrom Business as now being conducted.

    7.2 Due  Authorization and  Enforceability.  Seller has full corporate power
and authority to execute and deliver this  Agreement  and the Bill of Sale,  the
Deed, the Short-term  Escrow  Agreement,  the Long-term  Escrow  Agreement,  the
Memorandum of Allocation, the Noncompetition Agreement, and the other documents,
instruments  and agreements to which it is a party that are to be delivered upon
the Closing Date (collectively, the "Related Agreements"), and to consummate the
transactions contemplated hereby and thereby. The execution and delivery of this
Agreement  and the  Related  Agreements  by Seller and the  consummation  of the
transactions  contemplated  hereby and thereby has been duly  authorized  by all
necessary  corporate actions,  including votes of the directors of Seller and of
the  shareholders of Seller,  and no other corporate action or proceeding on the
part of Seller is  necessary  to authorize  the  execution  and delivery of this
Agreement  or the  Related  Agreements  or the  consummation  by  Seller  of the
transactions  contemplated  hereby or thereby.  This  Agreement  and the Related
Agreements have been duly executed and delivered by Seller, and are legal, valid
and binding  obligations of Seller enforceable against Seller in accordance with
their terms.

    7.3 No Conflicts.  Neither the  execution and delivery of this  Agreement or
the Related  Agreements nor the  consummation of the  transactions  contemplated
hereby or  thereby  will (i)  conflict  with or  violate  any  provision  of the
Articles of  Incorporation,  Bylaws or other Charter  documents of Seller,  (ii)
conflict with or violate any law,  rule,  regulation,  ordinance,  order,  writ,
injunction,  judgment or decree applicable to the Dahlstrom Business or by which
any of the Assets are bound or affected or (iii)  conflict with or result in any
breach of or  constitute  a default  (or an event  which with notice or lapse of
time or both  would  become a  default)  under,  or give to others any rights of
termination or  cancellation  of, or accelerate the  performance  required by or
maturity of, or result in the creation of any security interest, lien, charge or
encumbrance  on any of the Assets  pursuant to any of the terms,  conditions  or
provisions of, any note, bond, mortgage,  indenture, permit, license, franchise,
lease,  contract or other instrument or obligation to which Seller is a party or
by which any of the Assets are bound or affected;  except those Liens  permitted
by Section 7.7 of this  Agreement  and in the case of (ii) or (iii)  above,  for
such conflicts, violations, breaches, defaults, terminations,  cancellations and
accelerations  which in the aggregate will not have a material adverse effect on
the Dahlstrom Business.

    7.4 Financial  Statements.  Attached  hereto as Schedule 7.4 are the balance
sheets of Seller of the  fiscal  year ended  December  31,  1995,  and as of the
interim  period ended June 30, 1996,  and the related  statements  of income and
changes in financial position, for the respective fiscal year and interim period
then ended and the Financial  Condition  Summary dated July 10, 1996 (all of the
foregoing referred to above in this Section 7.4 are herein collectively referred
to as the "Seller Financial Statements"). The Seller Financial Statements fairly
present  the  assets,  liabilities  and  financial  position of Seller as of the
respective  dates set forth therein and the results of operations and changes in
financial position of Seller for the respective  periods set forth therein;  the
Seller  Financial  Statements have been prepared in each case in conformity with
generally accepted accounting  principles ("GAAP") applied on a consistent basis
throughout the periods involved.

    7.5 No Material Changes. Since December 31, 1995, to the date hereof, and at
the  Closing  Date,  (i)  there  have  been  no  changes  in the  Assets  or the
liabilities  (actual or  contingent) of Seller or in the nature and prospects of
the Dahlstrom  Business or its condition  (financial or otherwise) which have in
the aggregate  been material and adverse to the  Dahlstrom  Business,  and, (ii)
Seller has operated the Dahlstrom Business in the ordinary course and consistent
with past practice.

    7.6 All Necessary  Assets.  The Assets (including the Machinery & Equipment,
Inventory,  Material  Agreements,   Intellectual  Property,   Receivables,  Real
Property,  Permits,  Books and Records and  Goodwill)  being sold,  transferred,
conveyed,  assigned and delivered by Seller under this Agreement  constitute all
of the assets used by Seller in the conduct of the Dahlstrom Business.

    7.7 Title to Assets.  Seller  warrants  that Seller has good and  marketable
title  to  the  Assets  transferred  hereunder  and,  upon  consummation  of the
transactions contemplated by this Agreement, including execution and delivery of
the Bill of Sale,  the Deed or other  instruments  of transfer,  Purchaser  will
acquire title to the Assets,  free and clear of all mortgages,  pledges,  liens,
security  interests,  assignments,  conditional sales agreements,  encumbrances,
claims  or  charges  of any kind  ("Liens"),  except  for (i) Liens  created  by
Purchaser and, (ii) Liens set forth on Schedule 7.7 which Purchaser shall assume
at the Closing Date. At the Closing Date,  none of the Assets will be subject to
any commitment or other  arrangement for its sale or use by third parties except
under Material Agreements disclosed in Schedule 1.1.3.

    7.8 Condition of Assets.  The  Machinery & Equipment  included in the Assets
set forth in Schedule 1.1.1 are in good operating condition and repair, ordinary
wear and tear  excepted,  and are reasonably  satisfactory  for the purposes for
which the Assets are being  used,  and are capable of being used to carry on the
Dahlstrom Business.

    7.9 Compliance  with Laws.  The operation of the Dahlstrom  Business and the
use of the Assets  comply in all material  respects  with all  applicable  laws,
ordinances, rules, decrees, orders and regulations,  including federal and state
and local environmental laws and rules and laws related to employment, benefits,
and pensions (collectively the "Laws"), except for such failures to comply which
in the  aggregate  will not have a  material  adverse  effect  on the  Assets or
Dahlstrom  Business.  Seller  has  obtained  all  necessary  permits,  licenses,
certificates,  exemptions,  orders  and  approvals  and has filed  all  required
notices with federal,  state and local governmental  bodies that are required by
applicable  law for the use of the Assets and in order to conduct the  Dahlstrom
Business as  presently  conducted,  all of which are valid and  effective on the
date of this  Agreement and will be valid at the Closing Date, and all payments,
fees and costs thereof have been paid in full to the date of this  Agreement and
will be paid in full at the Closing Date.  Seller has not received notice of any
violations of any Laws or regulations or any covenants or contracts with respect
to the Dahlstrom  Business or any of the Assets, and to Seller's  knowledge,  no
such notice of violations is pending or has been threatened.

    7.10 Absence of  Litigation.  There are no  judgments  or other  judicial or
administrative  orders outstanding against Seller, nor is there any action, suit
or  proceeding  at  law  or in  equity  or  by or  before  any  governmental  or
administrative  instrumentality or other agency now pending or, to the knowledge
of Seller, threatened against or affecting Seller, the Assets or any of Seller's
property or rights which, if adversely  determined,  might materially impair the
right or  ability  of Seller  to carry on the  Dahlstrom  Business  as it is now
conducted  or as proposed  to be  conducted  by  Purchaser  or would  materially
adversely affect the financial condition of Seller. A true, correct and complete
list of all  suits  or  proceedings  at  law,  in  equity  or by or  before  any
governmental  or  administrative  instrumentality  or  other  agency  and  other
litigation  (whether  material or not) pending or threatened  against Seller, or
settled  within the last five (5) years is  attached  hereto as  Schedule  7.10.
Seller is not in default in any material  respect under any applicable  statute,
rule,  order,  certificate or regulation of any  governmental  authority  having
jurisdiction  over it. Seller has  conducted  the  Dahlstrom  Business in such a
manner so that there have been no  breaches  of express  warranty on the part of
Seller.

    7.11 Material Agreements. Schedule 1.1.3 is an accurate and complete list of
all of Seller's  Material  Agreements  of any kind as to which the rights and/or
obligations of which are being assumed or discharged by Purchaser.  There are no
other  Material  Agreements  being  assumed by  Purchaser.  Each of the Material
Agreements is valid and effective in accordance with its terms. True and correct
copies of the  Material  Agreements  have been  supplied to Purchaser by Seller,
appropriately   identified  in  order  that  such  Material  Agreements  can  be
identified and attached in Schedule  1.1.3. At the Closing Date, all consents to
the  assumptions of the  obligations  of Seller by Purchaser  under the Material
Agreements  will have been  obtained  by Seller.  All other  executory  contract
rights or obligations of Seller related to the Dahlstrom Business, not listed on
Schedule  1.1.3 and  therefore  not being  assumed by  Purchaser,  are listed in
Schedule 7.11. No party to any of the Material Agreements  (including Seller) is
in material default  thereunder and no event has occurred which with the passage
of time or the giving of notice or both  would  constitute  a  material  default
under any of the Material Agreements.


    7.12  Receivables.  The Receivables  being conveyed  hereunder and listed in
Schedule 1.1.5, will, at the Closing Date, be owned by Seller, free and clear of
all  claims,  encumbrances,  credits,  backcharges,  counterclaims,  setoffs and
deductions,  and are not subject to additional  requirements  of  performance by
Seller,  and such  Receivables  have not been billed or collected  for a greater
percentage  of the  work  done or  materials  supplied  than has  actually  been
performed or supplied by Seller.  At the Closing Date Seller and Purchaser shall
establish  a  reasonable  reserve  for bad debts  against  the  Receivables  for
purposes of the Net Worth Determination. Seller guarantees to Purchaser that the
Receivables shall be collected by Purchaser.

    7.13 Intellectual Property.  Seller owns or possesses and will have conveyed
to Purchaser at the Closing Date all Intellectual Property used in the Dahlstrom
Business,  and the  Intellectual  Property  does not, to the best  knowledge  of
Seller,  infringe  any patent or other  rights  owned by others,  nor has Seller
received any notice of conflict thereof with the asserted rights of others.

    7.14 Related Party Agreements.  No affiliate,  officer or director of Seller
or any related person has, directly or indirectly,  entered into any transaction
with Seller relating to the Dahlstrom Business.  For purposes of this Agreement,
the term  "related  person"  shall mean and  include  any person  related to any
affiliate,  officer  or  director  of  Seller  by blood or by  marriage,  or any
corporation,  partnership,  proprietorship,  trust or other  entity in which any
officer or  director of Seller (or any spouse,  ancestor  or  descendant  of the
same) has more than a five percent (5%) legal or beneficial interest.

    7.15 Inventory.  The Inventory of Seller included in the Assets (whether raw
materials, purchased components,  manufactured parts, work-in-process,  finished
goods or other) does not contain any damaged, defective, slow-moving (defined as
more than a two years'  supply of items used in new Dahlstrom  machine  products
and as more than a five  years'  supply of items  sold as  repair  parts,  under
normal  conditions of sale) or obsolete items which are not currently  usable or
saleable in the ordinary course of the Dahlstrom Business.

           (a)  Raw materials and purchased components shall be
valued individually at the lower of acquisition costs or market
value in accordance with GAAP consistently applied.  Acquisition
costs  shall be  determined  on an  item-by-item,  FIFO  basis.  Work-in-process
consisting of manufactured parts, sub-assemblies and equipment in the process of
being  assembled  and finished  goods shall be valued at the sum of the value of
the raw  material  and  purchased  components,  the direct labor and the factory
burden  applicable to said items as further set forth herein:  (i) raw materials
and purchased  components  shall be valued at the lower of acquisition  costs or
market value in accordance  with GAAP  consistently  applied,  (ii) direct labor
shall be valued at $13.93 per hour of direct labor  determined by Seller's labor
collection  system,  and (iii) factory burden shall be valued at $19.04 per hour
of direct labor  adjusted to eliminate any costs  inconsistent  with GAAP in the
calculation of burden.

            (b) The  value  at  which  the  Inventory  is  shown  on the  Seller
Financial  Statements  has been  determined  in  accordance  with  the  standard
valuation policy of Seller, consistently applied and in accordance with GAAP.

           (c) All items of  Inventory on hand at the  Schiller  Park,  Illinois
facility of Seller that are included in the physical counts at the Closing Date,
but not yet set forth or reflected in Seller's  accounts payable reported in the
Seller  Financial  Statements,  shall be disclosed to Purchaser on Schedule 7.15
attached hereto.

    7.16 Taxes.  With  respect to the  Dahlstrom  Business  and the Assets being
conveyed under this Agreement,  Seller has filed all federal,  state, county and
local tax returns, including information returns, which it is required by law to
file and has paid all income,  payroll,  withholding,  gross  receipts,  excise,
business  and  occupation,  sales,  use or other  taxes,  assessments  and other
governmental  charges due in respect of such returns,  except to the extent that
any such  taxes  are being  contested  in good  faith  and as to which  adequate
reserves have been set aside and Seller has accrued all taxes not yet due. Since
December 31, 1995,  Seller has not incurred any taxes other than taxes  incurred
in the  ordinary  course of  business,  and all such  taxes  are fully  reserved
against on the books of Seller.  Seller is not  delinquent in the payment of any
amount of taxes, and there are no Liens for any taxes upon the Assets of Seller,
except  Liens for current  taxes not yet due that are fully  reserved for on the
Seller Financial Statements and will be paid at the Closing Date. All taxes that
Seller was or is required by law to withhold or collect, have been and are being
withheld  or  collected  by it and have  been or are  being  held by it for such
payment.  All tax  returns  required  to be filed by or on behalf of Seller have
been prepared and filed in accordance  with all applicable  laws or requirements
and accurately reflect the taxable income (or other measure of tax) of the party
filing  the  tax  returns.  All  such  tax  returns,   estimates,   reports  and
declarations  are complete  and  accurate and disclose all taxes  required to be
paid for the periods  covered  thereby.  True and complete copies of federal and
state  income or  franchise  tax  returns of Seller  for the  fiscal  year ended
December 31, 1995 have been  delivered to  Purchaser.  No audit,  action,  suit,
investigation,  claim,  assessment or  examination  with respect to taxes is now
pending or  currently  in  progress  with  respect to Seller and, to the best of
Seller's knowledge, there is no basis therefor. Seller has not received from the
Internal Revenue Service or from any other tax authority of any state,  foreign,
county,  local,  or other  jurisdiction  a notice of  underpayment  of taxes,  a
proposed  assessment of taxes, a proposed  adjustment to any tax return filed or
other deficiency that has not been paid.

    7.17  No  Misrepresentation  or  Material   Non-disclosures.   Neither  this
Agreement nor the Related  Agreements,  nor any other  document,  certificate or
statement  furnished  to Purchaser in  connection  herewith  contains any untrue
statement  of a material  fact or omits to state a material  fact  necessary  in
order to make the statements  contained herein or therein not misleading.  There
is no fact known to Seller which materially  adversely  affects or in the future
may (so far as can now be foreseen)  materially  adversely  affect the Dahlstrom
Business or the Assets which has not been set forth in this Agreement.

    7.18  No  Defective  Products.   The  products  of  the  Dahlstrom  Business
previously manufactured and sold by Seller have, where necessary, been qualified
under and comply in all respects with the  specifications  and  requirements  of
applicable rating and compliance  agencies and safety standards and contain,  to
the best of Seller's knowledge,  no defects that will result in damage or injury
to person or property or in epidemic failure of the products.

    7.19 Employment  Activity.  To the best of Seller's knowledge,  Seller is in
compliance with all applicable laws respecting employment, employment practices,
employment benefits,  non-discrimination in employment and employment practices,
and  conditions  of employment  and payment of wages,  and is not engaged in any
unfair labor  practice.  There is no employment  discrimination  or unfair labor
practice  charge or complaint  against  Seller pending before the National Labor
Relations  Board,  the  Equal  Employment  Opportunity  Commission  or any other
federal,  state or local governmental agency arising out of Seller's activities,
and Seller has no  knowledge of any facts or  information  which would give rise
thereto;  there is no labor strike or labor  disturbance  pending or  threatened
against Seller nor is any grievance currently being asserted; and Seller has not
experienced a work stoppage or other material labor difficulties.

    7.20    Employee Benefit Plans

            (a) Set forth in  Schedule  7.20(A) is a true and  complete  list of
each "employee pension benefit plan" (as such term is defined in Section 3(2) of
the  Employee  Retirement  Income  Security  Act of  1974,  as  amended  and the
regulations  promulgated  thereunder ("ERISA")) maintained by Seller or an ERISA
Affiliate (as defined in Section 7.20(e) below), or with respect to which Seller
or an ERISA  Affiliate  is or will be  required  to make any  payment,  or which
provides or will provide  benefits to present or prior employees of Seller or an
ERISA  Affiliate  due to such  employment  (the "Pension  Plans").  Set forth in
Schedule  7.20(A) is a true and complete list of each "employee  welfare benefit
plan" (as such term is defined in Section 3(1) of ERISA)  maintained  by Seller,
or with respect to which  Seller is or will be required to make any payment,  or
which provides or will provide  benefits to present or prior employees of Seller
due to such  employment  (the  "Welfare  Plans") (the Pension  Plans and Welfare
Plans together being the "ERISA  Benefit  Plans").  Neither Seller nor any ERISA
Affiliate  (i) maintains or has  maintained,  or (ii) is or was required to make
any payment with respect to, any "employee  pension  benefit plan" (as such term
is defined in Section  3(2) of ERISA) ever  subject to Section 302 of ERISA.  No
ERISA  Benefit Plan or prior Pension Plan is or was a  "multiemployer  plan" (as
such term is defined in Section 3(37) of ERISA).

            (b) Other than those plans and programs listed in Schedule  7.20(A),
Schedule  7.20(B) is a true and complete  list of each of the following to which
Seller is a party or with respect to which it is or will be required to make any
payments (the "Non-ERISA Commitments"):

              (i)   each   retirement,   savings,   profit   sharing,   deferred
compensation,   severance,   stock  ownership,  stock  purchase,  stock  option,
performance, bonus, incentive, vacation or holiday pay, hospitalization or other
medical,  disability,  life or other  insurance,  or other  welfare,  benefit or
fringe benefit plan,  policy,  trust,  understanding or arrangement of any kind,
whether written or oral; and

              (ii)  each  employee  collective  bargaining  agreement  and  each
agreement,  understanding  or arrangement of any kind,  whether written or oral,
with or for the benefit of any present or prior officer,  director,  employee or
consultant  (including,  without  limitation,  each  employment,   compensation,
deferred compensation,  severance or consulting agreement or arrangement and any
agreement  or  arrangement  associated  with a change in  ownership  of Seller).
Seller has delivered to Purchaser correct and complete copies of (i) all written
Non-ERISA  Commitments and (ii) all insurance and annuity policies and contracts
and other documents relevant to any Non-ERISA Commitment.  Schedule 7.20(B) also
contains a complete and accurate description of all oral Non-ERISA Commitments.

            (c) Seller has  delivered  to  Purchaser  with respect to each ERISA
Benefit Plan  correct and complete  copies,  where  applicable,  of (i) all plan
documents and amendments  thereto,  trust agreements and amendments  thereto and
insurance  and annuity  contracts and  policies,  (ii) the current  summary plan
description,  (iii) the Annual  Reports (IRS Form 5500 series) and  accompanying
schedules,  as filed, for the most recently completed three plan years for which
such  reports  have  been  filed,  (iv) the  financial  statements  for the most
recently  completed  three  plan  years  for  which  such  statements  have been
prepared,  (v) the most  recent  determination  letter  issued  by the  Internal
Revenue  Service and the  application  submitted with respect to such letter and
(vi) all correspondence  with the Internal Revenue Service,  Department of Labor
and Pension Benefit Guaranty Corporation concerning any controversy.

            (d) Each  Pension  Plan which is intended to qualify  under  Section
401(a) of the Code is so qualified  under the Code as amended to the date hereof
and no  circumstance  exists  which  might  cause  such  plan to cease  being so
qualified.  With respect to each ERISA Benefit Plan, (i) there is no pending or,
to the best knowledge of Seller,  threatened  claim,  (ii) all contributions and
premiums  due have been made on a timely  basis and are  deductible  by  Seller,
(iii) no "prohibited  transaction"  described in Section 406 of ERISA or Section
4975 of the Code has occurred,  and (iv) Seller has no potential liability under
ERISA or the Code. Each of the ERISA Benefit Plans (i) has been  administered in
accordance  with its terms and (ii) complies in form, and has been  administered
in accordance,  with the requirements of ERISA and, where applicable,  the Code.
No  liability  has  been  asserted  (whether  or not  such  liability  is  being
litigated)  against  Seller or any  affiliate of Seller in  connection  with any
"employee pension benefit plan" (as defined in Section 3(2) of ERISA), including
but not limited to, any  withdrawal  liability  (as described in Section 4201 of
ERISA) with respect to any  multiemployer  plan (as defined in Section  3(37) of
ERISA). There are no reserves,  assets, surplus or prepaid premiums with respect
to any Welfare  Plan.  Seller and each ERISA  Affiliate  has  complied  with the
health care requirements of Part 6 of Title I of ERISA. Seller has no obligation
to provide health or death  benefits to its prior  employees or any other person
other than while an employee of Seller,  except as specifically required by Part
6 of Title I of ERISA. The consummation of the transactions contemplated by this
Agreement  will  not (i)  entitle  any  individual  to  severance  pay,  or (ii)
accelerate the time of payment,  vesting or increase the amount of  compensation
due to any such  individual.  Seller  has not taken any action or failed to take
any action which will subject Seller or has subjected  Seller to liability under
the Worker Adjustment and Retraining Notification Act of 1988.

            (e) For purposes of the Agreement,  "ERISA  Affiliate" means (i) any
corporation  which at any time on or before the Closing  Date is or was a member
of the same  controlled  group of  corporations  (within  the meaning of Section
414(b) of the Code) as Seller; (ii) any partnership,  trade or business (whether
or not  incorporated)  which at any time on or before the Closing Date is or was
under common control (within meaning of Section 414(c) of the Code) with Seller;
and (iii) any entity which at any time on or before the Closing Date is or was a
member of the same  affiliated  service  group  (within  the  meaning of Section
414(m) of the Code) as either Seller, any corporation described in clause (i) or
any partnership, trade or business described in clause (ii).

    7.21 No Indebtedness.  Seller does not have any outstanding  indebtedness to
any person or entity,  except for such  indebtedness as is set forth on Schedule
7.21 attached  hereto,  and except for indebtedness  being expressly  assumed by
Purchaser  under  Article  5  of  this  Agreement,   the  lenders  of  any  such
indebtedness have consented to the transfer of the Assets to Purchaser hereunder
free and clear of all Liens. For purposes of the Agreement, "Indebtedness" shall
mean all items which in  accordance  with GAAP would be included in  determining
total liabilities secured by any Lien on property owned or acquired,  whether or
not such a  liability  shall have been  assumed,  liabilities  in respect of all
leases,   whether  capitalized  or  operating,   and  guarantees,   indemnities,
endorsements  (other than for collection in the ordinary course of business) and
other  contingent  obligations,  whether  secured  or  not  in  respect  to  the
obligations of other persons or entities.

    7.22  Representations Regarding Transfer of Real Property.

         (a) There are no persons  other than Seller in  possession or occupancy
of the Real  Property  or any part  thereof,  nor are there any persons who have
possessory rights in respect to the Property or any part thereof.

         (b) Seller is not a foreign corporation,  foreign partnership,  foreign
trust or foreign estate (as those terms are defined in the Internal Revenue Code
and Income Tax Regulations).

         (c) There are no  claims,  causes  of  action  or other  litigation  or
proceedings by or against Seller pending or, to the best of Seller's  knowledge,
threatened  in writing to Seller in respect to the ownership or operation of the
Real  Property  or  any  part  thereof  (including  disputes  with  governmental
authorities,   utilities,  contractors,   adjoining  land  owners)  which  would
adversely affect the Real Property after the Closing.

         (d) To the best of  Seller's  knowledge,  Seller has not  received  any
notice of any fire, health, safety, building, pollution,  environmental,  zoning
or other violations of law in respect to the Real Property,  which have not been
fully and completely corrected.

         (e) To the best of Seller's knowledge,  there is no existing,  pending,
contemplated,  or threatened in writing to Seller,  (i) condemnation of any part
of the Real Property, or (ii) widening,  change of grade or limitation or use of
streets  abutting  the  Real  Property  except  for  anything  which  is  public
information.

         (f) There are not any contracts,  agreements, leases, licenses, written
or oral,  to which  Seller is a party or otherwise  bound,  other than as may be
expressly set forth herein,  which  Purchaser,  upon becoming  owner of the Real
Property,  will be  required  to assume or pay or to which  Purchaser  may, as a
consequence of entering into or closing this Agreement,  may become bound except
under Schedule 1.1.3 of this Agreement.

         (g) There are no judgments  affecting the Real Property that are unpaid
or unsatisfied  of record;  the Real Property is not in the hands of a receiver;
no application for any such  receivership is pending;  no petition in bankruptcy
has been filed by or against Seller, and there are no actions,  proceedings,  or
investigations  pending or, to the best of  Seller's  knowledge,  threatened  in
writing to Seller against or affecting Seller or the Real Property, and no basis
known to Seller for the same,  which,  if decided  adversely,  would  affect the
Seller's ability to carry out the transaction contemplated by this Agreement.

         (h) Seller has not received  written  notice of violation of applicable
Environmental Laws (as defined below) with respect to the Real Property from any
governmental  agency having authority which have not been cured or remediated in
compliance with applicable Environmental Laws.

         (i) Upon  repayment  of the  secured  loans made to Seller by  American
National  Bank,  Seller has the right to good and marketable fee simple title to
the Real Property  subject to no liens,  encumbrances,  mortgages,  assignments,
pledges, easements, equities, options, claims and rights of others of any nature
whatsoever, except for the following:

            (i)         Taxes and assessments not due and payable as
at the Closing Date;

            (ii) Zoning regulations and building code requirements,  ordinances,
and  restrictions  of record,  adopted by the government or municipal  authority
having proper jurisdiction thereof, and any amendments thereto, now in force and
effect, which relate to the Real Property; and

            (iii) The public  utility  easements,  private and public  roads and
highways, and covenants and restrictions of record.

         (j) No work has been  performed on the Real  Property  which could give
rise to a mechanics or construction lien which has not been paid.

         (k) Seller has no  knowledge  of either  having  committed or failed to
commit any acts which would cause a title  exception  to be noted by a competent
title  insurance  company and which would render the title of Seller in the Real
Property unmarketable.

         (l) Seller has no  knowledge  of any  structural  defects in any of the
improvements situated on the Real Property,  nor any defects in the plumbing and
electrical  systems,  or the heating and air  conditioning  systems  which might
reasonably be expected to impair the sales value or the Purchaser's intended use
of the Real Property as an office and manufacturing facility.



<PAGE>


         (m) there are no fence disputes,  boundary disputes,  water disputes or
drainage  disputes  affecting  the Real  Property,  and the Real Property is not
located in a hazardous  flood zone or, to the best of Seller's  knowledge,  in a
"wetland" or "transition area" as defined in the Environmental Laws.

    7.23  Environmental  Matters.  Seller has all permits,  licenses,  and other
authorizations  which are  required as of the date of this  Agreement  and which
will be required  as of the  Closing  Date for the  operation  of the  Dahlstrom
Business under federal,  state, local and foreign laws relating to pollution and
protection  of the  environment,  including,  without  limitation,  the Resource
Conservation and Recovery Act, 42 U.S.C. 6901, et seq., as amended ("RCRA"), the
Comprehensive Environmental Response,  Compensation and Liability Act, 42 U.S.C.
9601, et seq., as
amended  ("CERCLA"),  the Clean Air Act,  42 U.S.C.  7401,  et seq.,  as amended
("CAA"),  the Clean  Water  Act,  33 U.S.C.  1251,  et seq.  ("CWA"),  the Toxic
Substance  Control  Act,  15  U.S.C.  2601,  et seq.  ("TSCA"),  and  any  other
applicable federal,  state or local laws,  statutes,  ordinances and regulations
relating  to the  physical or  environmental  condition  of property  and to the
maintenance,  record-keeping  and  disposition  of  any  underground  tanks  and
relating  to  emissions,   discharges,   releases  or  threatened  releases,  of
pollutants,  contaminants, petroleum oils, chemicals or industrial, hazardous or
toxic materials or waste into the environment  (including,  without  limitation,
ambient water, surface water, groundwater, land surface or subsurface strata) or
otherwise relating to the manufacture, processing, distribution, use, treatment,
storage, disposal, transport or handling of pollutants,  contaminants, petroleum
oils,  chemicals  or  industrial,  hazardous  toxic  materials  or  waste or any
regulation,  order, decree or judgment issued, entered,  promulgated or approved
thereunder  (the  "Environmental  Laws").  With  respect  to the  conduct of its
business,  its  operations,  its  properties,  and its use of owned  and  leased
properties,  Seller is in compliance in all material respects with all terms and
conditions of the required permits,  licenses and authorizations necessary under
the Environmental  Laws, and is also in compliance in all material respects with
all  other  limitations,   restrictions,  conditions,  standards,  prohibitions,
requirements,   obligations,   schedules   and   timetables   contained  in  the
Environmental Laws as in effect on the date hereof. There is no pending civil or
criminal  litigation,  notice of violation or administrative  proceeding arising
out of the business or activities of Seller or any affiliates, including without
limitation any pending  litigation,  notice or proceeding relating in any way to
the  Environmental  Laws (including  notices,  demands,  letters or claims under
RCRA, CERCLA,  CAA, CWA, TSCA and similar foreign,  state and local laws). There
is  no  threatened  civil  or  criminal  litigation,   notice  of  violation  or
administrative  action  arising  out  of  the  business  activities  of  Seller,
including without limitation,  any threatened  litigation,  notice or proceeding
relating in any way to the  Environmental  Laws. Seller is not aware of any past
or present events, conditions,  circumstances,  practices,  incidents or actions
which may give rise to any legal  liability,  or otherwise form the basis of any
claim, action, suit,  proceeding,  hearing or investigation against or involving
Seller  arising out of any violation or alleged  violation of the  Environmental
Laws or any  circumstances  which could reasonably be expected to interfere with
or prevent  continued  compliance with the  Environmental  Laws in effect on the
date hereof or the Closing Date. To the best of Seller's knowledge, no hazardous
substances,  pollutants,  petroleum oils or fraction,  contaminants or hazardous
waste including, but not limited to, asbestos, "PCB's" and urea formaldehyde are
contained  in or have been,  from any source  whatsoever,  generated,  released,
spilled,  stored or deposited  over,  beneath or on the Schiller Park,  Illinois
facility of Seller, or on adjoining  properties,  by Seller,  or, to the best of
Seller's knowledge, any other person.

    7.24 Approvals and Consents.  No consent,  authorization  or approval of, or
waiver or exemption by, or filing with any other person or entity is required in
connection  with the  execution,  delivery or  performance  of this Agreement by
Seller or the consummation by Seller of the transactions contemplated hereby.

    7.25  Insurance.  Attached hereto as Schedule 7.25 is a complete and correct
list of all  policies  of  insurance  of which  Seller is the owner,  insured or
beneficiary,  or covering  the  Dahlstrom  Business or any of the Assets for any
policy period after January 1, 1993. Such Schedule indicates for each policy the
carrier,  policy  number or  numbers,  names of all insured  parties  thereunder
(including  the named insured and additional  insured  parties,  if any),  risks
insured,  the amounts of coverage,  deductibles and  retentions,  if any and any
pending claims thereunder.  All premiums under such policies for periods through
the date hereof have been paid and  through  the Closing  Date will be paid.  No
notice of  cancellation  or non-renewal  with respect to or  disallowance of any
claim under,  or increase of the premium for any such insurance  policy has been
received by Seller.

    7.26 Other  Intangibles.  The vendor and customer lists of Seller related to
the Dahlstrom Business attached hereto as Schedule 7.26 are true and complete as
of  the  Closing  Date;  and  the  engineering  drawings,   bills  of  material,
manufacturing  data and other intangibles  conveyed to Purchaser as described in
Section  1.1.7 of this  Agreement  are all of such items  used in the  Dahlstrom
Business that are in the possession of Seller. There exists no actual or, to the
knowledge of Seller, threatened termination, cancellation or material limitation
of, or material  modification  in, the business  relationship of Seller with any
customer or supplier.

    7.27 Warranties.  Set forth on Schedule 7.27 attached hereto are the express
warranty terms and  disclaimers  for all forms of warranties  given (or extended
warranties  sold) by Seller during the ten-year period prior to the Closing Date
with respect to the  Dahlstrom  Business  for product  sold or services  related
thereto provided by Seller. Seller, in operating the Dahlstrom Business, has not
sold any parts or equipment or performed any services related thereto which fail
to comply  with any  express  or  implied  warranties  or  guarantees  of Seller
applicable to such parts or equipment or services related thereto.

8.  Representations and Warranties of Purchaser

    Purchaser  represents  and  warrants  to  Seller as of the  Closing  Date as
follows:

    8.1  Corporate Existence.  Purchaser is a corporation organized  and 
existing in good standing under the laws of the State of Delaware.  Purchaser 
has full power and authority to own its assets and to carry on its business as 
and where such business is now conducted.



<PAGE>


    8.2 Due  Authorization  and  Enforceability.  Purchaser  has full  power and
authority to execute and deliver this  Agreement  and the Related  Agreements to
which it is a party, and to consummate the transactions  contemplated hereby and
thereby. The execution and delivery of this Agreement and the Related Agreements
to which it is a party, by Purchaser of the transactions contemplated hereby and
thereby have been duly authorized by all necessary corporate action and no other
action or  proceeding  on the part of Purchaser  is  necessary to authorize  the
execution and delivery by Purchaser of this  Agreement or Related  Agreements to
which  it is a  party  or the  consummation  by  Purchaser  of the  transactions
contemplated  hereby or thereby.  This  Agreement and the Related  Agreements to
which  Purchaser is a party have been duly  executed and  delivered by Purchaser
and this Agreement and the Related  Agreements to which Purchaser is a party are
legal, valid and binding obligations of Purchaser, enforceable against Purchaser
in accordance with their terms.

    8.3 No Conflicts.  Neither the  execution and delivery of this  Agreement or
the Related  Agreements to which Purchaser is a party,  nor the  consummation of
the  transactions  contemplated  hereby or  thereby  will (i)  conflict  with or
violate any provision of the Articles of Incorporation,  Bylaws or other Charter
documents of Purchaser, (ii) conflict with or violate any law, rule, regulation,
ordinance,  order, writ, injunction,  judgment or decree applicable to Purchaser
or by which any of its  properties  or assets  are  bound or  affected  or (iii)
conflict  with or result in any breach of or  constitute  a default (or an event
which with  notice or lapse of time or both would  become a default)  under,  or
give to others any rights or  termination or  cancellation  of, or result in the
creation of any lien, charge or encumbrance on any of their assets or properties
pursuant to any of the terms,  conditions,  or  provisions  of, any note,  bond,
mortgage,  indenture,  permit, license, franchise agreement, lease, contract, or
other  instrument or obligation to which Purchaser is a party or by which any of
Purchaser's  properties or assets are bound or affected;  except, in the case of
(ii) and  (iii)  above,  for such  conflicts,  violations,  breaches,  defaults,
terminations,  cancellations and  accelerations  which in the aggregate will not
have a material  adverse  effect on the ability of Purchaser to  consummate  the
transactions  contemplated by this Agreement and the Related Agreements to which
it is a party.

9.  Survival of Representations and Warranties.  The representations and 
warranties made in this Agreement or pursuant hereto shall survive the execution
and delivery of this Agreement and the conclusion and closing of the 
transactions contemplated hereby.

10. Covenants

    10.1 Retention of Records.  Purchaser  hereby covenants that for a period of
five (5) years following the Closing Date, Purchaser will retain, at Purchaser's
sole expense,  the Books and Records of Seller  relating to the operation of the
Dahlstrom Business prior to the Closing Date. During such period, Purchaser will
afford to Seller,  its counsel and  accountants,  during normal  business hours,
reasonable access to such books, records and other data, to the extent that such
access may  reasonably be required to facilitate  the  preparation  by Seller of
such tax returns as they may be required to file with  respect to Seller and the
investigation,  litigation and final disposition of any claims which may be made
against Seller. Following the expiration of such five (5) year period, Purchaser
may dispose of any such books, records and other data; provided,  however,  that
before  disposing of any such  materials it will first notify  Seller and permit
Seller at its sole expense, to remove such materials.

    10.2 Further Actions.  Upon the terms and subject to the conditions  hereof,
each of the parties hereto agrees to use its best efforts or take or cause to be
taken all action and to do or cause to be done all things necessary,  proper and
advisable to consummate the  transactions  contemplated by this  Agreement,  the
Related Agreements and other documents necessary to close this transaction,  and
shall use its best  efforts  to  obtain  all  necessary  waivers,  consents  and
approvals and to effect all necessary  registrations  and filings.  In addition,
Seller  covenants  and agrees  that it will take all  actions  and  execute  and
deliver all documents, instruments, and agreements necessary to assist Purchaser
in the removal of all Liens,  assuming  Purchaser has satisfied its  obligations
pursuant to its assumption of Seller's  liabilities as set forth in Article 5 of
this Agreement.

    10.3 Press  Releases.  Purchaser  and Seller  will  consult  with each other
before issuing any press release or otherwise making any public  statements with
respect to this Agreement or the transactions  contemplated hereby and shall not
issue any such press  release or make any such  public  statement  prior to such
consultation,  except as may be required by law or any listing  agreement with a
national  securities  exchange.  It is contemplated  that the parties will issue
press  releases to announce  the  execution of this  Agreement  and the expected
Closing.  Notwithstanding the foregoing,  Seller shall,  simultaneously with the
Closing,  notify its employees and creditors of the sale of assets  contemplated
by  this  Agreement,   specifically   noting  that  Purchaser  is  not  assuming
liabilities beyond those described in this Agreement.

    10.4 Receipt of Funds.  After the Closing Date, each of Purchaser and Seller
shall segregate any monies or other amounts paid to either of them in respect of
receivables  or assets  that  belong to the other  party,  and each party  shall
promptly  pay over and remit to the  other  party any such  monies  and  amounts
weekly  after  receipt  thereof.  Each of  Purchaser  and Seller  shall take all
reasonable  actions,  including the giving of timely  notices to assure that the
covenants set forth in this Section 10.4 are faithfully and timely fulfilled.

    10.5 Employees

         10.5.1 Potential Employees. Effective as of the Closing Date, Purchaser
or an affiliate of Purchaser may offer  employment to any of Seller's  personnel
now working  full-time  at the  Schiller  Park,  Illinois  facility of Seller (a
"Potential Employee"). Any Potential Employee who accepts an offer of employment
and who commences  employment  with Purchaser upon the terms of such offer on or
after the Closing Date is an "Accepting  Employee".  Seller shall be responsible
and  liable  for  any  required  notification  and  payments  under  the  Worker
Adjustment and Retraining Notification Act of 1988.

         10.5.2  Benefits.  Purchaser  will not  assume  or have any  liability,
responsibility  or obligation  under any of the Pension Plans,  Welfare Plans or
Non-ERISA  Commitments of Seller.  Seller will be responsible and liable for and
discharge  at or prior to Closing  all  obligations  to, for or on behalf of all
Potential  Employees  under any  Pension  Plans,  Welfare  Plans  and  Non-ERISA
Commitments,  including,  without limitation, if applicable, the cost of accrued
and unpaid wages, unpaid bonuses, stock options, severance pay, accrued personal
days,  unpaid  holidays,  and sick leave,  the cost of  retirement  benefits and
pensions,  the cost of  payroll  taxes,  including  FICA,  Federal  Unemployment
Insurance,  State Unemployment Insurance and Federal and State withholding,  and
the cost of health  insurance,  dental  insurance,  disability  insurance,  life
insurance  and the like for events  prior to and  including  the  Closing  Date.
Seller also will be responsible and liable for the costs of  administration  and
compliance  with the  Consolidated  Omnibus  Budget  Reconciliation  Act of 1985
("COBRA") for any qualifying  event or as required under applicable state law or
similar group health contribution  coverage benefits under federal and state law
(collectively  such costs and those set forth in the sentence prior hereto shall
be defined as "Separation Benefits").

         10.5.3 Eligibility of Accepting Employees.  For purposes of eligibility
for  employment  plans,   programs  and  for  vacation  during  employment  with
Purchaser,  Purchaser's  policies or those of its  affiliates  as set forth from
time to time  hereafter  shall be applied  in  accordance  with their  terms and
conditions to all Accepting  Employees.  The service of Accepting Employees with
Seller prior to the Closing Date shall be recognized for purposes of eligibility
for  participation  in Purchaser's  401(k) plan,  vacation accrued in accordance
with and subject to the terms and conditions of  Purchaser's or its  affiliates'
applicable  vacation  policies as stated from time to time and other  applicable
employment benefits plans and programs.

         10.5.4 Claims of Accepting Employees. Seller hereby agrees to indemnify
and hold harmless Purchaser,  its agents, officers or directors,  employees, and
affiliates  against any  liabilities,  costs or expenses  (including  reasonable
attorneys'  fees)  resulting  from claims made by any Potential  Employees,  any
prior  employees of Seller and/or any applicants for employment  with Seller for
Separation  Benefits.  Subject to the accuracy of the  representations of Seller
contained  herein,  Purchaser  hereby  agrees to indemnify  Seller,  its agents,
officers, directors,  employees and subsidiaries against any liabilities,  costs
or expenses including reasonable  attorney's fees) resulting from claims made by
any Accepting Employees relating to acts and omissions of Purchaser with respect
to the  employment of such  Accepting  Employees by Purchaser  after the Closing
Date.

    10.6 Discharge of  Liabilities.  Seller will pay and discharge in due course
after the Closing Date,  and hold  Purchaser  harmless  from,  all  liabilities,
obligations  and taxes of Seller  relating to and arising from the ownership and
operation of the Assets and the  Dahlstrom  Business  prior to and including the
Closing  Date,  (whether  unrecorded  accounts  payable,   accrued  liabilities,
customer  deposits  or other  obligations),  that are not  expressly  assumed by
Purchaser  pursuant  to the  terms  of  Article  5 of this  Agreement,  it being
understood  that  Purchaser is assuming no  liabilities or obligations of Seller
other than those expressly set forth in Article 5 of this  Agreement.  If Seller
fails to pay and  discharge any such  liabilities  and, in the case of bona fide
disputes  regarding  such  liabilities,  fails  to  disclose  to  Purchaser  the
existence of and all facts relating to such bona fide  disputes,  Purchaser may,
without having any duty,  pay or discharge such  liabilities of Seller and apply
for  reimbursement  from the Escrow  Agent,  offset such  amounts  paid from any
obligation  of Seller to  Purchaser  or use the  indemnification  provisions  of
Article 16 of this Agreement.

    10.7  Products  Liability  Claims.  Seller  hereby  covenants  to defend and
undertake any and all obligations and liabilities  under any claims for products
liability, failure to warn, breach of warranty, sales misrepresentation or other
related claims arising from loss and injury to person and/or property  occurring
prior to and including the Closing Date due to the alleged acts and omissions of
Seller. Seller will maintain in force policies of insurance in sufficient limits
to meet the above  obligation.  The Long-term Esrow Amount shall be available to
meet the obligations of Seller hereunder.

    10.8  Name Change.  Immediately after the Closing Date, Seller shall change
its name sufficiently so as not to use "Dahlstrom" or any variant thereof.

    10.9 IRPTA Disclosure  Document.  Purchaser and Seller  acknowledge that the
purpose of the Illinois Responsible Property Transfer Act ("IRPTA") is to ensure
that the parties to the  transaction  contemplated  hereby are made aware of the
existing  environmental   liabilities  associated  with  the  ownership  of  the
Property,  as well as the past use and  environmental  status  of the  Property.
Purchaser and Seller hereby waive the thirty (30) day IRPTA Disclosure  Document
delivery  period and agree that the Disclosure  Document  required by IRPTA (the
"IRPTA  Document")  will be prepared by Seller and will be provided to Purchaser
by Seller on or before the Closing Date.

    10.10  Real  Property  Apportionment.  The  general  real  estate  taxes and
assessments,  water and sewer charges, utility bills, prepaid charges,  payments
and accrued expenses  relating to the Real Property,  and any leases,  licenses,
occupancy  certificates,  and any and  all  other  items  relating  thereto  not
specifically  mentioned  which  are  customarily   apportioned  in  real  estate
transactions  of this kind (the  "Proratable  Items") shall be apportioned as of
the Closing Date. The net amount of any such apportionment  shall be added to or
deducted  from,  as the case may be, the amount due Seller on the  Closing  Date
with respect to the Real Property.  If on the Closing Date,  real property taxes
for the then current fiscal period are not known, the apportionment of such real
property taxes shall be made on the basis of 100% of the real property taxes for
the  immediately  preceding  fiscal  tax  period for which such taxes are known.
Seller  and  Purchaser  hereby  agree to adjust the  apportionment  of such real
property taxes when the actual bills  therefor are issued.  If the real property
taxes which are to be apportioned shall thereafter be reduced by abatement,  the
amount of such abatement,  less the reasonable cost of obtaining the same, shall
be  apportioned  between  the  parties,  provided  that  neither  party shall be
obligated   to   institute   or   prosecute   proceedings   for  an   abatement.
Notwithstanding  anything to the contrary contained herein, Seller and Purchaser
acknowledge  that Seller shall be responsible for the Proratable  Items relating
to periods on or before the  Closing  Date  regardless  of when such  Proratable
Items shall become due and payable,  and Purchaser  shall be responsible for all
such Proratable Items relating to periods after the Closing Date.

    10.11  Material  Changes in  Operations.  Seller  shall  refrain,  except as
otherwise  allowed in this  Agreement or approved in advance by Purchaser,  from
(i) making any  purchases,  sales or  transfers  of any Assets other than in the
ordinary  course of business;  (ii) entering  into any contracts or  commitments
other than in the  ordinary  course of  business;  (iii)  mortgaging,  pledging,
subjecting  to lien or  otherwise  encumbering  any Asset;  (iv)  granting a pay
raise,  price increase or decrease or making any change in the  compensation  or
benefits  payable to  employees,  agents or sales  representatives  of Seller or
making any bonus payment or arrangement , or (v) violating any federal, state or
local laws with respect to the operation of the Dahlstrom Business or the use of
the Assets.  Seller shall use its best efforts to pay all  liabilities and taxes
in a timely  manner,  to preserve the  Dahlstrom  Business  intact,  to keep the
services of the present  officers and key employees and to preserve the goodwill
of all suppliers,  customers,  sales  representatives and others having material
business  relations with Seller.  Except with Purchaser's prior written consent,
which will not be unreasonably withheld,  Seller shall not allow the coverage of
any of the  liability  or property  insurance  of the  Dahlstrom  Business to be
diminished  in any material  respect.  Seller will exercise all due diligence in
safeguarding  and  maintaining  secure  all of the Books and  Records of Seller.
Seller shall not on behalf of itself or its shareholders  enter into,  engage in
or  initiate  any   negotiations   or   discussions   regarding  (i)  a  merger,
consolidation,  reorganization,  restructuring  or  similar  transaction  of  or
regarding  Seller or (ii) the sale,  directly or indirectly,  of any of Seller's
capital stock or rights related thereto or the Assets. Seller shall refrain from
declaring, setting aside, paying or making any dividend or other distribution or
payment whether in cash,  stock or property with respect to any capital stock of
Seller or other rights in respect of or related thereto.

    10.12  Access to  Information.  Seller shall  furnish to  Purchaser  and its
representatives  full access at all reasonable  times to the employees,  Assets,
agents,  affiliates and Books and Records of Seller and shall  promptly  furnish
all information with respect to the Dahlstrom  Business as Purchaser  reasonably
requests from time to time.

    10.13 Real Property and Asset Matters

         10.13.1 Environmental  Covenants.  Seller agrees to allow Purchaser and
its  representatives  and  agents  upon  prior  notice  to  conduct  a  Phase  I
Environmental  Audit  (the  "Audit")  of all  aspects  of the  operation  of the
Dahlstrom  Business and the condition of the Real Property,  including,  without
limitation,  historical and present operations,  waste disposal practices at the
Real Property, permit status and compliance,  prospective viability of continued
operation of the Dahlstrom  Business in compliance with the Environmental  Laws,
and groundwater, air emission and soil evaluation.  Seller will cooperate in all
aspects  of  the  Audit  and  allow   complete   access  by  Purchaser  and  its
representatives  and agents to the Real Property and all information  requested.
Seller shall allow  Purchaser  and its  representatives  and agents to take such
samples of soil, wastewater effluent, subsurface water, air emissions and solids
as Purchaser  deems necessary to complete the Audit.  Purchaser  agrees to leave
the Real  Property  in the same  condition  as  prior  to the  Audit  and not to
materially disturb the operations of Seller in the conduct of the Audit.

         10.13.2  Maintenance of Real  Property.  Seller shall maintain the Real
Property in the same manner that Seller has been  maintaining the Real Property.
Seller shall use its best efforts to maintain all permits and consents necessary
to the operation of the Dahlstrom Business and to maintain the Real Property. If
the  Real  Property  is  in a  municipality  that  has  ordinances  requiring  a
Certificate  of  Occupancy  or  other  inspection  certificate  before  the Real
Property

<PAGE>


may be used by  Purchaser,  Seller shall make any and all  required  repairs and
alterations,  at its expense, to maintain or obtain a current certificate by the
Closing Date.

         10.13.3 Destruction of Assets. In the event of damage or destruction of
any of the Assets prior to the Closing Date, then, at Purchaser's election,  the
damaged  or  destroyed  Assets  shall be  excluded  from this  Agreement  with a
corresponding  reduction in Purchase  Price,  or Purchaser  shall be entitled to
receive the insurance  proceeds  payable in respect of such Assets in lieu of or
together  with such Assets,  in which event the Purchase  Price shall remain the
same.  In the event the Assets are  damaged  or  destroyed  by reason of fire or
other casualty to such an extent that the  operations of the Dahlstrom  Business
are  substantially  impaired,  then  Purchaser may, by written notice to Seller,
terminate this  Agreement.  The Closing may be delayed to determine  whether the
Assets  have  been  substantially   impaired.   Seller  shall  notify  Purchaser
immediately in the event of any damage or destruction to the Assets.

11.  Closing

    11.1 Closing. The closing of the transaction  contemplated by this Agreement
(the "Closing") shall be held on the 30th day of August, 1996 or such other date
as mutually agreed by the parties,  at the offices of Barasa & Larkin,  105 West
Madison, 22nd Floor, Chicago,  Illinois at 10 a.m., local time, or at such other
time and place as the parties may agree.

    11.2 Closing Events.  At the Closing upon the Closing  Date:

            11.2.1  Purchaser, Seller and Escrow Agent shall execute the 
Short-term Escrow Agreement and the Long-term Escrow Agreement.

            11.2.2  Seller shall  execute and deliver to  Purchaser  the Bill of
Sale and any other documents of transfer regarding personal property.

            11.2.3  Seller  shall  provide  to  Purchaser  any and all  required
written consents to Purchaser's assumption of the Material Agreements.

            11.2.4 Purchaser shall execute and deliver to Seller the Certificate
of  Assumption,  in the  form  attached  hereto  as  Exhibit  11.2.4  for  those
liabilities  of  Seller  assumed  by  Purchaser  pursuant  to  Article 5 of this
Agreement.

            11.2.5  Purchaser  shall have  received a written legal opinion from
counsel to Seller and Seller shall have  received a written  legal  opinion from
counsel to Purchaser  substantially  in the respective  forms attached hereto as
Exhibit 11.2.5.

            11.2.6  Purchaser  shall have  received  from  Seller a  certificate
signed by the Chairman  and  President  of Seller that the  representations  and
warranties of Seller are true as of the Closing Date,  and that all covenants to
be performed by Seller by the Closing Date have been performed.

            11.2.7  The parties shall complete and execute the Memorandum of 
Allocation.

            11.2.8  Seller shall obtain from its secured and judgment  creditors
and lenders and deliver to Purchaser such lien releases,  terminations and other
documents  necessary to assure Purchaser to its satisfaction that the Assets are
being  transferred by Seller to Purchaser under this Agreement free and clear of
all liens and encumbrances.

            11.2.9 Mr. Harold A.  Williamson  shall have executed a Limited-Term
Employment  Agreement and Messrs.  James F.  Williamson and Burton Lowther shall
have  executed  Employment  Agreements  in  form  and  substance  acceptable  to
Purchaser.

            11.2.10  Seller shall deliver to Purchaser a fully
executed IRPTA Document.

            11.2.11  Seller  shall  deliver  to  Purchaser  a  release  from the
Illinois  Department of Revenue of claims against Seller under Section 902(d) of
the  Illinois  Income  Tax  Act  and  Section  5(j)  of the  Illinois  Retailers
Occupation Tax Act.

            11.2.12  Seller shall  execute and deliver to Purchaser the Deed and
all other  documents,  certificates,  statements,  declarations  and  affidavits
necessary or generally  delivered  for the transfer of real estate like the Real
Property, including without limitation, the Title Commitment and Title Policy.

            11.2.13  Purchaser  shall  pay the  Purchase  Price as set  forth in
Section 3.3 of this Agreement.

12.  Conditions to  Purchaser's  Obligation  to  Complete  Closing

    The  obligation  of  Purchaser to purchase and pay for the Assets at Closing
shall be subject to the satisfaction,  prior to or concurrently with the Closing
Date, of each of the following express  conditions  precedent,  unless waived by
Purchaser:

    12.1  Consents and  Releases.  Seller shall have  obtained and  delivered to
Purchaser  (based upon  Purchaser's  assumption  thereof)  any and all  required
consents to the  assignment  of the Material  Agreements,  the lien and judgment
releases and terminations of security  interests  described in Section 11.2.8 of
this Agreement so that the Assets may be transferred by Seller to Purchaser free
and clear of all liens and  encumbrances,  and a release from  Hoganson  Venture
Group, Inc. regarding its fee.

    12.2  Governmental Approvals.  Purchaser and Seller shall have obtained all
requisite government approvals, if any, for their participation in the 
transactions contemplated under this Agreement.

    12.3 Accuracy of  Representations.  The  representations  and  warranties of
Seller shall be true and correct in all material  respects at the Closing  Date,
and Seller shall have complied with all covenants set forth in this Agreement.

    12.4 Closing Documents  Delivered.  Seller shall have executed and delivered
the  documents,  certificates,  instruments  and  agreements  and  done the acts
required of Seller in connection  with the Closing as described in Section 11 of
this Agreement.

    12.5 No Prohibition.  No order, statute, rule, regulation,  executive order,
injunction,  stay, decree or restraining order shall have been enacted, entered,
promulgated or enforced by any court or competent  jurisdiction  or governmental
or regulatory  authority or  instrumentality  that prohibits the consummation of
the transactions contemplated hereby.

    12.6  Bankruptcy.  Seller  shall  not  be  the  subject  of a  petition  for
reorganization or liquidation under the Federal  bankruptcy laws, or under state
insolvency  laws,  nor shall an  assignment  for the benefit of creditors or any
similar protective proceeding or act or event of bankruptcy have occurred.

    12.7 Real Property Fulfillments.  Purchaser shall have received prior to the
Closing Date a title  report  indicating  that,  upon the payment of the secured
loans made by  American  National  Bank to Seller,  Seller  will obtain good and
marketable  title to the Real Property and any title defects noted in such title
report shall have been cured in full by Seller.  The survey of the Real Property
previously  provided by Seller to Purchaser  shall have been certified as of the
Closing Date to be accurate by the surveyor.  Purchaser is reasonably  satisfied
with the results of the Phase I Environmental Audit. No uninsured casualty shall
have occurred with respect to the Real Property. No damage or destruction of the
Assets to the extent  that the  operation  of the  Dahlstrom  Business  has been
substantially impaired shall have occurred.

    12.8  Non-Fulfillment  Date.  In the event that one or more of the foregoing
conditions  in this  Article 12 is not  fulfilled  by the date of  September  30
,1996, Purchaser may, upon notice to Seller on or prior to Closing, elect either
(i) to waive the  condition  and  proceed to  Closing;  or (ii)  terminate  this
Agreement  without  any further  liability  on the part of either of the parties
except that the foregoing shall not relieve either of the parties from liability
for damages actually incurred as a result of breach of this Agreement.

13.  Conditions to Seller's obligation to Complete the Closing

    The  obligation of Seller to sell and convey the Assets at the Closing shall
be subject to the satisfaction,  prior to or concurrently with the Closing Date,
of each of the following express conditions precedent:

    13.1 Government Approvals.  Purchaser and Seller have obtained all requisite
government approvals, if any, for their participation in transactions 
contemplated under this Agreement.

    13.2 Accuracy of  Representations.  The  representations  and  warranties of
Purchaser  shall be true and  correct in all  material  respects  at the Closing
Date, and for Purchaser  shall have complied with all of its covenants set forth
in this Agreement.



<PAGE>


    13.3  Closing  Documents  Delivered.   Purchaser  shall  have  executed  and
delivered the documents,  certificates,  instruments and agreements and done the
acts  required of Purchaser  in  connection  with the  Closing,  as described in
Section 11 of this Agreement.

    13.4 No Prohibition.  No order, statute, rule, regulation,  executive order,
injunction, stay, decree or restraining order, shall have been enacted, entered,
promulgated or enforced by any court or competent  jurisdiction  or governmental
or regulatory  authority or  instrumentality  that prohibits the consummation of
the transactions contemplated hereby.

14.     [Intentionally left blank.]

15.  Amendment and Waiver

    15.1  Amendment.  This Agreement may be amended only by a writing executed
by the authorized representatives of Purchaser and Seller.

    15.2  Waiver.  Any party  hereto  may (a)  agree to extend  the time for the
performance of any of the obligations or other acts of the other parties hereto,
(b) waive any  inaccuracies  in the  representations  and  warranties  contained
herein or in any document delivered pursuant hereto or (c) waive compliance with
any of the agreements or conditions  contained herein. Any agreement on the part
of the party  hereto to any such  extension or waiver shall be valid only if set
forth in an instrument in writing  signed by the  authorized  representative  of
such party.

16. Indemnification

    16.1  Purchaser  Indemnification.  Purchaser  hereby agrees to indemnify and
hold Seller  harmless,  from and against  any and all loss,  liability  (whether
known or unknown, actual or contingent,  legal or equitable, mature or inchoate,
as  guarantor  or  principal  obligor,  howsoever  arising),  claim,  damage and
expense,  including,  but not limited to, reasonable attorneys' fees and amounts
reasonably expended in settlement of litigation,  pending or threatened, arising
out of or relating  to: (i) any  liabilities  or  obligations  of the  Dahlstrom
Business which were expressly  assumed by Purchaser under this  Agreement;  (ii)
any  material  misrepresentation  or  material  breach  of  any  of  Purchaser's
representations  and  warranties  set  forth in this  Agreement;  or  (iii)  any
material  breach of any of  Purchaser's  covenants  or  obligations  under  this
Agreement.

    16.2 Seller  Indemnification.  Seller  hereby  agrees to indemnify  and hold
Purchaser  harmless from and against any and all loss,  liability (whether known
or  unknown,  actual or  contingent,  legal or  equitable,  mature or  inchoate,
howsoever arising), damage and expense,  including but not limited to reasonable
attorneys'  fees and amounts  reasonably  expended in settlement of  litigation,
pending or threatened,  arising out of or relating to: (i) any  liabilities  and
obligations  of Seller not expressly  assumed by Purchaser  under the Agreement;
(ii) any  material  misrepresentation  or  material  breach  of any of  Seller's
representations  and  warranties  set  forth in this  Agreement;  or  (iii)  any
material  breach  of  any  of  Seller's  covenants  or  obligations  under  this
Agreement.


    16.3 Procedure of Indemnification

         16.3.1 Neither  Purchaser nor Seller are required to take any action or
make any claim to any third person as a precondition of seeking  indemnification
from the other(s) hereunder.  The party seeking indemnification (the "Claimant")
shall promptly give notice to the indemnifying party or parties of any matter or
item which forms a basis for indemnification hereunder (a "Claim"). The Claimant
shall  afford  the   indemnifying   party  or  parties,   or  their   authorized
representatives,  the opportunity to defend,  discharge or compromise such Claim
and examine the books and records of the Claimant insofar as they relate to such
Claim and to copy or make  extracts  therefrom,  and will (at the expense of the
indemnifying  party)  provide full  cooperation  of itself and its employees and
agents  with  respect to such  Claim.  At an  indemnifying  party's  request and
expense,  the  Claimant  will assign any claims or rights which the Claimant may
have against any third party in an action against the third parties, and, at the
indemnifying  party's  expense,  the  Claimant  will  cooperate  fully  with the
indemnifying party in pursuing any such claim or right.

         16.3.2 The  indemnifying  party or parties may, within twenty (20) days
after the Claimant  has given  notice of the Claim,  give notice to the Claimant
that the indemnifying  party or parties intend to litigate or otherwise  attempt
to resolve the claim identified in the Claimant's notice.  Upon such notice from
the indemnifying party or parties to the Claimant: (i) the indemnifying party or
parties,  or any of them,  shall have the right,  at their sole cost and expense
and without  liability,  cost or expense,  to Claimant,  to  prosecute  any such
proceeding,  defend any such  Claim or  otherwise  attempt to resolve  the Claim
(including,  but not  limited to,  settling  such claim by paying all amounts in
settlement),  and (ii)  Claimant  shall  have the  right to  participate  at its
expense in the  defense of any such  Claim.  The  indemnifying  party or parties
shall keep the Claimant  appraised of all material  developments  in  connection
with any such Claim.

         16.3.3. So long as any indemnifying party shall continue  determination
that monies are payable by Claimant to a third person, the indemnifying party or
parties will not be obligated to pay to Claimant the monies so claimed.

         16.3.4  Notwithstanding the foregoing Section 16.3.3; if as a result of
any  Claim,  a judgment  is entered  against  Claimant  in a court of  competent
jurisdiction,  or a lien  attaches to any property or asset of Claimant,  or any
injunction,  order or decree is obtained in any court of competent  jurisdiction
which  materially  and adversely  affects or threatens to materially  affect the
assets, property,  business or operations of Claimant, Claimant will be entitled
to discharge,  compromise or settle such Claim in good faith without the consent
of the indemnifying party or parties.

         16.3.5 All  amounts  incurred or paid by the  Claimant  for which it is
entitled to indemnification by the indemnifying party or parties pursuant to the
terms and conditions of this Agreement shall be promptly reimbursed to it by the
indemnifying  party or  parties if not  reimbursed  within  thirty  (30) days of
written request therefor, Claimant shall have the right to offset from any other
amounts  it  owes  or may  owe to  the  indemnifying  party  or  parties.  It is
contemplated  by the parties to this  Agreement that prompt payment by Seller of
the agreed Claims of Purchaser shall be  accomplished,  insofar as possible,  by
application  and use of the  Short-term  Escrow Amount and the Long-term  Escrow
Amount.  In the event  Claimant  collects  or retains an amount in excess of the
amount  of claim or lien,  including  reasonable  costs and  expenses  including
attorneys'  fees,  Claimant shall return such funds to the  indemnifying  party.
Claimant  shall  cooperate in  accordance  with its best business  judgment,  in
attempting  to cause third  parties who are liable to it or to the  indemnifying
party,  to cause such third  parties to  reimburse  the  indemnifying  party for
payment made by it to Claimant;  and Claimant shall  subrogate the  indemnifying
party to Claimant's rights against third parties, with respect to claims paid by
the indemnifying party to Claimant.

    16.4 Exclusive  Remedy.  So long as the indemnifying  party is in compliance
with  this  Article  16,  the  remedies  provided  in this  Article  16 shall be
exclusive,  except for (a) remedies set forth  elsewhere in this Agreement (such
as  application  or use of the  Short-term  Escrow Amount and  Long-term  Escrow
Amount),  and (b)  specific  performance  or  injunctive  relief  which shall be
available  regardless of the provisions of this Article 16 so long as claims for
specific performance or injunctive relief are made within thirty-six (36) months
of the Closing Date.

    16.5 Limitation on Indemnities.  Notwithstanding  anything set forth in this
Agreement,  the aggregate  total amount of  indemnifications  required of Seller
under this  Article 16 shall not exceed the amount of the Purchase  Price.  This
limitation on indemnity shall not apply to claims of fraud.  The time limitation
set forth in Section 16.4 of this Agreement,  shall not apply to claims of fraud
or actions to enforce  Article 6, Sections 7.2, 7.7, 7.16, 8.2 and Article 19 of
this Agreement.

    16.6 Guarantee of Purchaser Obligations.  Mestek, Inc. shall guarantee the
obligations of Purchaser under this Agreement by the execution and delivery of 
a guarantee substantially in the form attached hereto as Exhibit 16.6 
(the "Mestek Guarantee").

17. Notices. Any notices or other communications required or permitted hereunder
or otherwise in connection  herewith  shall be in writing and shall be deemed to
have been duly  given  when  delivered  in person or  transmitted  by  facsimile
transmission  or on receipt after  dispatch by express,  registered or certified
mail, postage prepaid, addressed as follows:

              If to Seller:

              Dahlstrom Industries, Inc.
              c/o Laurence Barasa, Esq.
              Barasa & Larkin
              105 W. Madison, 22nd Floor
              Chicago, Illinois 60602



              If to Purchaser:

              Formtek, Inc.
              260 North Elm Street
              Westfield, Massachusetts 01085
              Attention:  R. Bruce Dewey,
              Senior Vice President


or such other  address as the person to whom notice is to be given has furnished
in writing to the other parties.

18.  Further Assurance -- After Closing

    18.1  Assurance  of  Seller.  At any time and from  time to time  after  the
Closing Date, at Purchaser's request and without further  consideration,  Seller
shall cooperate in good faith and promptly  execute and deliver all such further
instruments  or  documents  and perform such other and further acts as Purchaser
may  reasonably   request  is  in  order  to  fully  conclude  the  transactions
contemplated hereby.

    18.2 Delivery of Notices.  After the Closing Date, each party shall promptly
deliver  to the other  party any  notices,  correspondence  and other  documents
relating to the Assets being  conveyed  hereunder  and the  Dahlstrom  Business,
which are, from time to time, received by that party.

19.  Confidentiality

     19.1  Proprietary  information.   Purchaser  acknowledges  its  receipt  of
substantial  information from Seller concerning the Dahlstrom Business. All such
information is hereinafter called the "Proprietary Information".

     19.2 Nondisclosure. Seller acknowledges that it is now in possession of the
same  Proprietary  Information  concerning  the Dahlstrom as described  above in
Section  19.1.  Seller  agrees  to  keep  all  of  the  Proprietary  Information
confidential  after the Closing Date,  except such Proprietary  Information that
becomes public information without the fault of Seller.

20.  Entire  Agreement -- Binding  Effect.  This  Agreement  (together  with the
Exhibits and Schedules hereto,  the Related  Agreements and the other agreements
executed at the  Closing)  sets forth the entire  integrated  understanding  and
agreement  of  the  parties  with  respect  to the  subject  matter  hereof  and
supersedes all prior  agreements  whether written or verbal.  This Agreement may
not be modified,  amended or terminated except in a writing signed by all of the
parties hereto.

21. Assignment. No party to this Agreement shall have the right to assign any of
its rights and  obligations  hereunder  without the prior written consent of the
other parties hereto.  To the extent that such consent is given,  this Agreement
and all provisions  hereof shall be binding upon and inure to the benefit of the
parties hereto and their respective successors and assigns.

22.  Miscellaneous

    22.1 Expenses.  Except as otherwise  agreed herein,  each party hereto shall
bear its own  expenses  incurred  in  connection  with  this  Agreement  and the
consummation of the transactions contemplated hereby.

    22.2   Counterparts.   This  Agreement  may  be  executed  in  two  or  more
counterparts,  each of which shall be deemed to be an original  instrument,  but
all such counterparts together shall constitute one and the same instrument.

    22.3 Governing Law. This Agreement is being made in and shall be governed by
and construed and enforced in accordance  with the laws of the State of Illinois
and the  United  States  of  America,  except  for the  conflicts  laws of those
jurisdictions.

    22.4 No Third Party Rights.  This Agreement,  the Related Agreements and the
other  agreements  entered into at the Closing are solely for the benefit of the
parties hereto.  No third person shall acquire any rights or claims by reason of
or under this Agreement,  the Related Agreements or the other agreements entered
into at the Closing.

    22.5 Severability.  Should any terms,  provision or clause hereof, or of any
other agreement or document which is required by this  Agreement,  be held to be
invalid, such invalidity shall not affect or render invalid any other provisions
or clauses  hereof or thereof the  consideration  or  mutuality  of which can be
given effect  without such invalid  provision,  and all of which shall remain in
full force and effect.  If any provision of this  Agreement is so broad as to be
unenforceable,  such  provision  shall be  interpreted to be only so broad as is
enforceable under applicable law.

    22.6  Headings.  The headings to the sections of this Agreement are inserted
for  convenience  and reference only and are not intended to define or limit the
substance of any section.

    22.7 Singular and Plural.  Singular terms in this Agreement may be deemed to
include plural, and plural terms to include the singular.

    22.8  Brokerage  Fees.  Neither  Seller  nor  Purchaser,  nor  any of  their
officers,  directors or employees,  has incurred any liability for any brokerage
fees,  commissions,  finders'  fees or similar fees or expenses for which either
Seller or Purchaser may be liable,  except Seller has engaged  Hoganson  Venture
Group,  Inc. and its  principal  Kenneth B. Hoganson as its agent and broker and
hereby is liable and undertakes the  responsibility  for the payment of all fees
and costs  thereof,  absolving  and  indemnifying  Purchaser of any  obligations
therefor or related thereto.


     22.9 Exhibits and Schedules.  The exhibits and schedules referenced in this
Agreement and attached hereto shall be deemed to be a part of this Agreement and
are incorporated herein by this reference.

    IN WITNESS  WHEREOF,  the parties hereto have executed this Agreement  under
seal, with the intent that this be a sealed instrument,  on the date first above
written.

SELLER:                      DAHLSTROM INDUSTRIES, INC.
CORPORATE SEAL
ATTEST:

By: /s/ Burton Lowther                    By:/S/HAROLD A. WILLIAMSON
                                          Harold A. Williamson, Chairman
                                          and Chief Executive Officer

PURCHASER:                   FORMTEK, INC.
CORPORATE SEAL
ATTEST:

By: /s/ R.B. Dewey                        By:/S/STEPHEN M. SHEA
                                          Stephen M. Shea, Vice
                                          President-Finance