Document:

STOCK PURCHASE AGREEMENT

         This Stock Purchase Agreement (this "Agreement") is dated May__ , 1999,
between ISG Resources, Inc., a Utah corporation ("Purchaser"),  and William __ .
Leslie,  an  individual   residing  in  the  state  of  Montana  and  __________
(individually a "Seller" and collectively the "Sellers").

                                    RECITALS

         The Sellers own and desire to sell to Purchaser,  and Purchaser desires
to  purchase  from the  Sellers,  all of the  issued and  outstanding  shares of
capital  stock  of  Mineral  Specialties,   Inc.  (the  "Company"),   a  Montana
corporation.

         The  authorized  capital  stock of the Company is referred to herein as
the "Purchased Stock."

         Unless otherwise defined in this Agreement,  the capitalized terms used
in this Agreement have the meanings given in Article VIII below.

         In  consideration  of the mutual  covenants  and  agreements  set forth
herein,  and  for  other  good  and  valuable  consideration,  the  receipt  and
sufficiency  of which are  hereby  acknowledged,  the  parties  hereto  agree as
follows:

                                    ARTICLE I

1        SALE OF PURCHASED STOCK; CLOSING

         1.1 Purchase and Sale. At the Closing,  on the terms and conditions set
forth in this Agreement,  the Sellers will sell to Purchaser, and Purchaser will
purchase from the Sellers, the Purchased Stock.

         1.2      Purchase Price and Additional Purchase Price.

                  1.2.1  The  purchase  price  (the  "Purchase  Price")  for the
Purchased  Stock is $__________  in cash,  subject to adjustment as set forth in
Section 1.2.2 below.

                  1.2.2  Additionally,  the  Purchaser  shall  pay the  Seller a
royalty  of  five  percent  (5%)  (the  "Additional   Purchase  Price")  of  the
Purchaser's  sales of fly ash generated at the Colstrip  facility should the ash
generated at that  facility  become  marketable.  The royalty will be calculated
using  the  F.O.B.  plant  price,  less any  processing  costs  incurred  by the
Purchaser and less any payments  made by the Purchaser to the utility,  and will
be paid for a period of five (5) years from the date on which such sales begin.

                  1.2.3 The Purchase Price will increase dollar for dollar equal
to the amount of increase in the Company's net book value (the "Net Book Value")
(defined as total assets less liabilities)  during the period ___________ to the
Closing Date . To determine whether an adjustment is appropriate,  Sellers shall
(within  thirty days of the Closing Date) provide the Purchaser  with  financial
statements of the Company  indicating  the Net Book Value as of the Closing Date
(the "Sellers' Calculation").  If Purchaser (within thirty days of receiving the
Sellers' Calculation")  disagrees with the Sellers' Calculation,  then Purchaser
will  promptly  engage an  independent  accounting  firm to review the financial
condition of the Company as of the Closing in  accordance  with GAAP, on a basis
consistent with the Financial Statements.  Within forty-five (45) days after the
matter is referred to the accounting  firm, the accounting firm will prepare and
deliver a report to all  parties  which will  detail  whether a  Purchase  Price
adjustment is  necessary.  The report will be final and binding on both parties,
absent fraud or clear error.

         1.3 Closing.  The Closing (the  "Closing")  of the purchase and sale of
the Purchased Stock will take place at the offices of __________________ , or at
such other place as Purchaser and the Sellers  shall  mutually  agree,  at 10:00
A.M.  local time,  on the latest to occur of the  following  dates (the "Closing
Date"):

                  1.3.1 June ___ , 1999;

                  1.3.2  Two  days  after  the  date  on  which  all  conditions
precedent to the closing specified herein are satisfied;

                  1.3.3 Two days after the receipt by  Purchaser  or Seller of a
written termination of the waiting period issued by the Federal Trade Commission
or the United  States  Department of Justice  pursuant to the  Hart-Scott-Rodino
Antitrust Improvements Act of 1976, as amended ("HSR"), or the expiration of the
waiting period described therein; or

                  1.3.4 Such other date as the parties shall agree upon.

         1.4 Payment of Purchase Price.  At the Closing,  Purchaser will pay the
Purchase  Price to the Sellers by wire  transfer to such  account as the Sellers
may direct by written  notice  delivered  to  Purchaser  by the Sellers at least
three (3) Business  Days before the Closing  Date.  Simultaneously,  the Sellers
will sell and  convey to  Purchaser  the  Purchased  Stock free and clear of all
Liens, by delivering to Purchaser a stock certificate, registered in the name of
Purchaser,  representing the Purchased Stock. At the Closing,  the parties shall
also deliver the opinions, certificates, contracts, documents and instruments to
be delivered pursuant to this Agreement.

         1.5 Post Closing  Payment.  If the  Purchaser  agrees with the Seller's
Calculation,  then  within  twenty  (20) days  after  delivery  of the  Sellers'
Calculation, the Purchaser will deliver to the Sellers cash in the amount of the
adjustment  specified  therein.  If the  Purchaser  disagrees  with the Sellers'
Calculation,  within  twenty  (20)  days  after  delivery  of the  report by the
independent  accounting  firm referred to in Section  1.2.2,  the Purchaser will
deliver to the Sellers  cash in the amount of the  adjustment  specified  in the
report, if any, absent fraud or clear error.

                                   ARTICLE II

2        REPRESENTATIONS AND WARRANTIES OF THE SELLERS

         The Sellers,  to their best knowledge,  hereby represent and warrant to
Purchaser as follows:

         2.1 Organization and  Qualification.  The Company is a corporation duly
organized,  validly existing and in good standing under the laws of the state of
Montana and has full  corporate  power and  authority to conduct its business as
and to the  extent  now  conducted  and to own,  use and lease its  Assets.  The
Company is duly  qualified,  licensed or admitted to do business  and is in good
standing  in each  jurisdiction  in which the  ownership,  use or leasing of its
Assets,  or the  conduct or nature of its  business,  makes such  qualification,
licensing or admission  necessary,  except for such failures to be so qualified,
licensed  or  admitted  and  in  good  standing  which,  individually  or in the
aggregate,  (i) are not having and could not be  reasonably  expected  to have a
material  adverse  effect on the  business or  condition of the Company and (ii)
could  not be  reasonably  expected  to have a  material  adverse  effect on the
validity or  enforceability of this Agreement or any other agreement to which it
is a party or on the  ability  of the  Sellers or the  Company to perform  their
obligations  hereunder or  thereunder.  The Sellers have  delivered to Purchaser
true and complete  copies of the  certificate or articles of  incorporation  and
by-laws  (or other  comparable  corporate  charter  documents)  of the  Company,
including all amendments thereto effected through the Closing Date.

         2.2 Capital Stock. The Purchased Stock consists of the following number
of shares of capital stock:

            ___ shares of common stock, par value $___  per share,
            and ______ shares of preferred stock, par value $____ per share

The Purchased  Stock  constitutes  all of the issued and  outstanding  shares of
capital stock of the Company.  The shares of Purchased Stock are validly issued,
fully paid and nonassessable,  issued in compliance with all applicable Laws and
no additional shares of capital stock have been reserved for issuance. There are
no  outstanding  Options with respect to the stock of the Company or agreements,
arrangements or understandings to issue Options with respect to the Company, nor
are there any preemptive rights or agreements, arrangements or understandings to
issue  preemptive  rights  with  respect to the  issuance or sale of the capital
stock of the Company. The Sellers are the record and beneficial owners of all of
the shares of  Purchased  Stock,  free and clear of all Liens.  The  delivery to
Purchaser of the certificates  representing the Purchased Stock will transfer to
Purchaser  good and valid title to all shares of the Purchased  Stock,  free and
clear of all Liens,  and  restrictions  and after such  transfer  the  Purchased
Stock,  in the hands of  Purchaser,  will have  been  duly  authorized,  validly
issued, fully paid and nonassessable.  From and after the Closing, no Seller nor
any other Person (other than the Purchaser) will have any rights whatsoever with
respect to the Purchased Stock or to any other securities of the Company.

         2.3  Authority  Relative  to This  Agreement.  The  Sellers  have  full
authority to enter into this Agreement,  to perform their obligations  hereunder
and to consummate the transactions  contemplated hereby. This Agreement has been
duly and validly  executed  and  delivered  by the Sellers and  constitutes  the
legal, valid and binding obligations of the Sellers, enforceable against them in
accordance with its terms.

         2.4  Subsidiaries;  Company;  Business.  Section 2.4 of the  Disclosure
Schedule  lists all lines of business in which the Company is  participating  or
engaged or has participated or engaged in the preceding three years. The name of
each director and officer of the Company, and the position with the Company held
by each, are listed in Section 2.4 of the Disclosure Schedule. The Company holds
no equity, partnership, joint venture or other interest in any Person.

         2.5 No  Conflicts.  The  execution  and delivery by the Sellers of this
Agreement does not, and the consummation of the transactions contemplated hereby
will not:

                  2.5.1  conflict with or result in a violation or breach of any
of the terms,  conditions  or  provisions  of the  certificate  or  articles  of
incorporation or by-laws (or other comparable  corporate  charter  documents) of
the Company;

                  2.5.2  subject  to  obtaining  the  consents,   approvals  and
actions,  making the filings  and giving the notices  referred to in Section 2.6
below or disclosed in Section 2.6 of the Disclosure  Schedule,  if any, conflict
with or result in a violation  or breach of any term or provision of any Laws or
Order  applicable  to any of the  Sellers  or to the  Company,  or any of  their
Assets; or

                  2.5.3  except as  disclosed  in Section 2.5 of the  Disclosure
Schedule,  (i)  conflict  with or  result in a  violation  or  breach  of,  (ii)
constitute  (with or without  notice or lapse of time or both) a default  under,
(iii) require any of the Sellers or the Company to obtain any consent,  approval
or action of,  make any filing with or give any notice to any Person as a result
or under  the  terms  of,  (iv)  result  in or give to any  Person  any right of
termination,  cancellation,  acceleration or modification in or with respect to,
(v) result in or give to any  Person any  additional  rights or  entitlement  to
increased,  additional,  accelerated or guaranteed payments under, or (f) result
in the creation or  imposition of any Lien upon the Company or any of its Assets
under,  any  Contract or License to which any of the Sellers or the Company is a
party or by which  any of  their  respective  Assets  is bound  except  for such
conflicts,   violations,   breaches,  defaults,  consents,  approvals,  actions,
filings, notices,  terminations,  cancellations,  accelerations,  modifications,
additional  rights  or  entitlements  or  Liens  that,  individually  or in  the
aggregate,  (A) are not having and could not be  reasonably  expected  to have a
material  adverse  effect on the business or  condition of the Company,  and (B)
could  not be  reasonably  expected  to have a  material  adverse  effect on the
validity or  enforceability  of this  Agreement  or on the ability of any of the
Sellers or the Company to perform its obligations hereunder.

         2.6 Governmental Approvals and Filings.  Except as disclosed in Section
2.6 of the  Disclosure  Schedule,  and other than filings with the Federal Trade
Commission  and the United  States  Department of Justice under HSR, no consent,
approval or action of, filing with or notice to any  Governmental  or Regulatory
Authority  on the part of the Sellers or the  Company is required in  connection
with  the  execution,   delivery  and  performance  of  this  Agreement  or  the
consummation of transactions contemplated herein.

         2.7 Books and Records.  The minute books and other  similar  records of
the Company to be provided to Purchaser upon execution of this Agreement contain
a true and complete record, in all material respects, of all action taken by the
stockholders,  the board of directors and  committees of the boards of directors
(or other similar governing entities) of the Company.

         2.8  Financial  Statements.  The  Sellers  have  caused the  Company to
furnish to Purchaser  true and complete  copies of (i) the  unaudited  financial
statements of the Company as of December 31, 1998 and (ii)  unaudited  financial
statements  of the Company for the period  January 1, 1999 through May 31, 1998,
along with the related  statements of operations and cash flows,  accompanied by
the opinions thereon of ____________ , independent certified public accountants,
together with the notes thereto, certified by the chief financial officer of the
Company.  All of these  statements,  opinions,  etc.  (collectively  referred to
herein  as the  "Financial  Statements")  are in  accordance  with the Books and
Records of the Company and fairly and accurately  present the financial position
of the Company as of the dates thereof,  for the periods covered thereby and the
results of  operations  and cash flows of the  Company for the periods set forth
therein,  all in conformity with GAAP, except as specifically noted in the notes
thereto.  Further,  the Sellers  represent  and warrant  that, as of the Closing
Date,  the Net Book Value of the Company shall be at least equal to the Net Book
Value of the Company as of December 31, 1998.

         2.9 Absence of Changes. Since December 31, 1998, there has not been any
material  adverse change or any event or  development,  which,  individually  or
together  with other such events,  could  reasonably  be expected to result in a
material  adverse  change,  in the  business or  condition  of the  Company.  In
addition,  except as  expressly  contemplated  hereby and except as disclosed in
Section 2.9 of the  Disclosure  Schedule,  there has not occurred since December
31, 1998:

                  2.9.1  any  declaration,  setting  aside  or  payment  of  any
dividend or other  distribution in respect of the capital stock (or other equity
interests)  of the  Company or any direct or  indirect  redemption,  purchase or
other  acquisition  by the Company of any such  capital  stock (or other  equity
interests) of the Company;

                  2.9.2 any authorization,  issuance,  sale or other disposition
by the Company of any shares of its capital  stock (or other equity  interests),
or any  modification  or amendment of any right of any holder of any outstanding
shares of capital stock (or other equity interests) of the Company;

                  2.9.3 (i) any increase in salary,  rate of commissions or rate
of  consulting  fees of any  employee or  consultant  of the  Company;  (ii) any
payment  of  consideration  of  any  nature   whatsoever   (other  than  salary,
commissions  or  consulting  fees  paid to any  employee  or  consultant  of the
Company) to any officer,  director,  stockholder,  employee or consultant of the
Company; (iii) any establishment or modification of (A) targets, goals, pools or
similar provisions under any Benefit Plan, employment contract or other employee
compensation  arrangement or (B) salary ranges,  increase  guidelines or similar
provisions in respect of any Benefit Plan, employment contract or other employee
compensation  arrangement;  or (iv)  any  adoption,  entering  into,  amendment,
modification or termination (partial or complete) of any Benefit Plan;

                  2.9.4 (i)  incurrences by the Company of  Indebtedness or (ii)
any  voluntary  purchase,  cancellation,   prepayment  or  complete  or  partial
discharge  in advance of a scheduled  payment date with respect to, or waiver of
any right of the Company under, any Indebtedness of or owing to the Company;

                  2.9.5 any physical damage,  destruction or other casualty loss
(whether or not covered by insurance) affecting any of the Assets of the Company
in an aggregate amount exceeding $10,000;

                  2.9.6 any write-off or write-down of or any  determination  to
write off or write down any of the Assets of the Company;

                  2.9.7 any purchase of any Assets of any Person or  disposition
of, or incurrence of a Lien on, any Company Assets,  other than  acquisitions or
dispositions  of  inventory  in the  ordinary  course of business by the Company
consistent with past practice;

                  2.9.8 any entering into, amendment, modification,  termination
(partial or  complete)  or granting of a waiver under or giving any consent with
respect to (i) any  Contract  which is required (or had it been in effect on the
date hereof would have been required) to be disclosed in the Disclosure Schedule
pursuant to Section 2.18.1,  (ii) any License held by the Company,  or (iii) any
intellectual property rights owned by the Company;

                  2.9.9 any capital expenditures or commitments for additions to
property,  plant or equipment of the Company  constituting  capital assets in an
aggregate amount exceeding $10,000;

                  2.9.10 any commencement,  termination or change by the Company
of any line of business;

                  2.9.11  any  transaction  by  the  Company  with  any  of  its
officers,  directors,  stockholders  or  Affiliates,  other than  pursuant  to a
Contract  or  arrangement  in effect  on  December  31,  1998 and  disclosed  to
Purchaser pursuant to Section 2.18.1.8 or other than pursuant to any Contract of
employment and listed pursuant to Section 2.18.1 of the Disclosure Schedule;

                  2.9.12 any  entering  into of an  agreement to do or engage in
any of the foregoing,  including without  limitation with respect to any merger,
sale of  substantially  all assets or other business  combination  not otherwise
restricted by the foregoing paragraphs; or

                  2.9.13 any change in the  accounting  methods or procedures of
the Company or any other  transaction  involving or  development  affecting  the
Company outside the ordinary course of business.

         2.10 No  Undisclosed  Liabilities.  Except  as  reflected  or  reserved
against in the  December  31,  1998  balance  sheet  included  in the  Financial
Statements  or as  disclosed  in Section 2.10 of the  Disclosure  Schedule,  the
Company  has no  Liabilities,  nor are  there  any  Liabilities  relating  to or
affecting the Company or any of its Assets.

         2.11     Taxes.

                  2.11.1  Except as disclosed in Section 2.11 of the  Disclosure
Schedule,  all Tax Returns required to have been filed by or with respect to the
Company with any Taxing Authority have been duly and timely filed, and each such
Tax Return correctly and completely reflects the income,  franchise or other Tax
liability and all other information required to be reported thereon. The Company
is not and has never been a member of any  affiliated,  combined,  consolidated,
unitary or similar  group with respect to the filing of tax returns or otherwise
with respect to any Taxing Authority.  All Taxes owed by the Company (whether or
not shown on any Tax Return) have been paid. All monies  required to be withheld
by the Company from employees, independent contractors, creditors or other third
parties for Taxes have been  collected or  withheld,  and either duly and timely
paid to the  appropriate  Taxing  Authority  or (if not yet due for payment) set
aside in accounts for such purposes.  The Company has no liability for Taxes for
any Person other than the Company (i) solely as a present or former  member of a
consolidated group, (ii) as a transferee or successor, (iii) by Contract or (iv)
otherwise.

                  2.11.2  The  provisions  for  current  Taxes in the  Financial
Statements  are  sufficient for the payments of all accrued and unpaid Taxes not
yet due and  payable  as of their  dates,  whether  or not  disputed.  As of the
Closing Date, such  provisions,  as adjusted for the passage of time through the
Closing Date, will be sufficient for the  then-accrued  and unpaid Taxes not yet
due and payable of the Company.

                  2.11.3 The Company is not a party to any agreement  extending,
or having the effect of extending,  the time within which to file any Tax Return
or the period of  assessment  or  collection  of any Taxes.  The Company has not
received any written  ruling of a Taxing  Authority  related to Taxes or entered
into any written and legally binding agreement with a Taxing Authority  relating
to Taxes.

                  2.11.4 No Taxing  Authority is now asserting or threatening to
assert  against the Company any  deficiency,  claim or liability for  additional
Taxes or any adjustment of Taxes,  and there is no reasonable basis for any such
assertion of which any of the Sellers or the Company is or reasonably  should be
aware.  No issues have been raised in any  examination  by any Taxing  Authority
with  respect to the  Company  which,  by  application  of  similar  principles,
reasonably  could be expected to result in a proposed  deficiency  for any other
period not so examined.  The federal income Tax Returns of the Company  disclose
(in  accordance  with Section  6662(d)(2)(B)  of the Code) all  positions  taken
therein that could give rise to a substantial  understatement  of federal income
Tax within the  meaning of section  6662(d) of the Code.  No claim has ever been
made by any Taxing  Authority  in a  jurisdiction  in which the Company does not
file Tax Returns that it is or may be subject to taxation by that  jurisdiction.
Schedule 2.11 of the  Disclosure  Schedule lists all federal,  state,  local and
foreign  income Tax  Returns  filed by or with  respect to the  Company  for all
taxable  periods  ended on or after  December  31,  1998,  indicates  those  Tax
Returns,  if any, that have been audited,  and indicates  those Tax Returns that
currently  are the subject of audit.  The Sellers  have  delivered  to Purchaser
complete and correct copies of all federal,  state, local and foreign income Tax
Returns  filed  by or with  respect  to,  and all Tax  examination  reports  and
statements of deficiencies  assessed  against or agreed to by, the Company since
December 31, 1996. There are no Liens for Taxes upon the Assets of the Company.

                  2.11.5  Except as disclosed in Section 2.11 of the  Disclosure
Schedule,  the Company is not (i) a party to or bound by any  obligations  under
any tax sharing, tax indemnity or similar agreement or arrangement, (ii) subject
to any election under sections  338(e) or 341(f) of the Code or the  regulations
thereunder,  (iii) required to make, or reasonably expects that it might have to
make, any adjustment under section 481 of the Code (or any comparable  provision
of state,  local or foreign law) by reason of a change in  accounting  method or
otherwise,  (iv)  subject to any  agreement  or  arrangement  that could  result
separately or in the aggregate in the payment of any "excess parachute payments"
within  the  meaning of  section  280G of the Code,  (v) and at no time has ever
been, a "United States real property holding  corporation" within the meaning of
section  897(c)(2) of the Code,  (vi) a party to any "safe harbor lease" that is
subject to the provisions of section  168(f)(8) of the Internal  Revenue Code as
in effect  prior to the Tax  Reform Act of 1986 or to any  "long-term  contract"
within  the  meaning  of  section  460 of the  Code,  (vii) a party to any joint
venture,  partnership or other  arrangement that is treated as a partnership for
federal  income Tax  purposes,  or (viii) nor has it ever been,  a member of any
affiliated,  consolidated,  combined,  unitary  or  similar  group  for  any Tax
purpose.

         2.12     Legal Proceedings.

                  2.12.1  Except as disclosed in Section 2.12 of the  Disclosure
Schedule (with paragraph references corresponding to those set forth below):

                           2.12.1.1 there are no actions or proceedings  pending
or, to the knowledge of the Sellers or the Company, threatened against, relating
to or affecting the Company,  or any of its Assets which (A) could reasonably be
expected  to  result  in the  issuance  of an Order  restraining,  enjoining  or
otherwise prohibiting or making illegal any of the transactions  contemplated by
this  Agreement or  otherwise  result in a material  diminution  of the benefits
contemplated by this Agreement to Purchaser,  or (B) if determined  adversely to
the Company,  could  reasonably  be expected to result in (x) any  injunction or
other  equitable  relief  against  the  Company,  or (y) Losses by the  Company,
individually or in the aggregate with Losses in respect of other such actions or
proceedings, exceeding $10,000;

                           2.12.1.2 there are no facts or circumstances known to
the Sellers or to the Company that could  reasonably be expected to give rise to
any action or  proceeding  that would be  required to be  disclosed  pursuant to
clause 2.12.1.1 above;

                           2.12.1.3  neither  the  Sellers  nor the  Company has
received notice, or is aware of any Orders or lawsuits  outstanding  against the
Company; and

                           2.12.1.4  neither  the  Sellers  nor the  Company has
received notice or is aware of any defects,  dangerous or substandard conditions
in  the  products  or  materials  manufactured,  sold,  distributed,  or  to  be
manufactured, sold or distributed by the Company that could cause bodily injury,
sickness,  disease,  death,  or damage to property,  or result in loss of use of
property,  or any claim,  suit, demand for arbitration or notice seeking damages
for bodily injury,  sickness,  disease, death, or damage to property, or loss of
use or property.

                  2.12.2 Prior to the execution of this  Agreement,  the Sellers
and the  Company  have  delivered  all  responses  of counsel for the Company to
auditors' requests for information  regarding actions or proceedings  pending or
threatened  against,  relating to or  affecting  the  Company  during the period
commencing January 1, 1995. Section 2.12.2 of the Disclosure Schedule sets forth
all actions or  proceedings  relating to or affecting  the Company or its Assets
during the period commencing January 1, 1995 prior to the date hereof.

         2.13  Compliance  with Laws and Orders.  Except as disclosed in Section
2.13 of the  Disclosure  Schedule,  neither  the  Sellers  nor the  Company  has
received at any time since January 1, 1995 any notice that the Company is or has
been at any time since such date, in violation of or in default  under,  any Law
or Order applicable to the Company or any of its Assets.  In furtherance and not
limitation  of the  foregoing,  neither the Sellers nor the Company has violated
any  federal or state  securities  law in  connection  with the  offer,  sale or
purchase of any securities.

         2.14 Benefit  Plans;  ERISA.  All Benefit Plans relating to the Company
are  listed  in  Section  2.14 of the  Disclosure  Schedule,  and  copies of all
documentation  relating  to such  Benefit  Plans  have  been  delivered  or made
available to  Purchaser  (including  copies of written  Benefit  Plans,  written
descriptions of oral Benefit Plans, summary plan descriptions, trust agreements,
the  three  most  recent  annual  returns,  employee  communications,   and  IRS
determination  letters).  Except as disclosed in Section 2.14 of the  Disclosure
Schedule:

                  2.14.1 each  Benefit  Plan,  and the  administration  thereof,
complies, and has at all times complied, with the requirements of all applicable
Law,  including  ERISA and the Code,  and each Benefit Plan  intended to qualify
under  section  401(a) of the Code has at all times since its  adoption  been so
qualified,  and each trust  which forms a part of any such plan has at all times
since its adoption been tax-exempt under section 501(a) of the Code;

                  2.14.2 no Benefit Plan has incurred any  "accumulated  funding
deficiency"  within the  meaning of section  302 of ERISA or section  412 of the
Code;

                  2.14.3 no direct,  contingent or secondary  liability has been
incurred or is expected to be incurred by the Company under Title IV of ERISA to
any party with  respect to any Benefit  Plan,  or with respect to any other Plan
presently or heretofore maintained or contributed to by any ERISA affiliate;

                  2.14.4 the "amount of unfunded benefit liabilities" within the
meaning of section 4001(a)(18) of ERISA does not exceed zero with respect to any
Benefit Plan subject to Title IV of ERISA;

                  2.14.5 no  "reportable  event"  (within the meaning of section
4043 of  ERISA)  has  occurred  with  respect  to any  Benefit  Plan or any Plan
maintained by an ERISA affiliate since the effective date of said section 4043;

                  2.14.6 no  Benefit  Plan is a  multiemployer  plan  within the
meaning of section 3(37) of ERISA;

                  2.14.7  Neither  the  Company  nor  any  ERISA  affiliate  has
incurred any  liability  for any Tax imposed under section 4971 through 4980B of
the Code or civil liability under section 502(i) or (l) of ERISA;

                  2.14.8 no benefit under any Benefit Plan,  including,  without
limitation,  any  severance or  parachute  payment  plan or  agreement,  will be
established  or  become  accelerated,   vested  or  payable  by  reason  of  any
transaction contemplated under this Agreement;

                  2.14.9 no Tax has been incurred  under section 511 of the Code
with respect to any Benefit  Plan (or trust or other  funding  vehicle  pursuant
thereto);

                  2.14.10  no  Benefit  Plan  provides  health or death  benefit
coverage beyond the termination of an employee's employment,  except as required
by Part 6 of Subtitle B of Title I of ERISA or section  4980B of the Code or any
state laws requiring  continuation of benefits coverage following termination of
employment;

                  2.14.11 no suit, actions or other litigation (excluding claims
for  benefits  incurred in the  ordinary  course of plan  activities)  have been
brought or, to the knowledge of any Seller or the Company, threatened against or
with respect to any Benefit Plan and there are not facts or circumstances  known
to any the Sellers or the Company that could reasonably be expected to give rise
to any such suit, action or other litigation; and

                  2.14.12 all  contributions to Benefit Plans that were required
to be made under such Benefit  Plans have been made,  and all  benefits  accrued
under any unfunded Benefit Plan have been paid, accrued or otherwise  adequately
reserved in accordance  with GAAP, all of which accruals under unfunded  Benefit
Plans are as  disclosed  in Section  2.14 of the  Disclosure  Schedule,  and the
Company has performed all material  obligations  required to be performed  under
all Benefit Plans.

         2.15     Real Property.

                  2.15.1 Section 2.15.1 of the  Disclosure  Schedule  contains a
true and correct list of (i) each parcel of real property owned (the "Owned Real
Property") by the Company, (ii) each parcel of real property leased or subleased
or otherwise  occupied by the Company as tenant or  subtenant  (the "Leased Real
Property";  together with the Owned Real Property, the "Real Property") together
with a true and correct  list of all such  leases,  subleases  or other  similar
agreements and any amendments,  modifications  or extensions  thereto (the "Real
Property  Leases"),  and (iii) all Liens  relating to or affecting any parcel of
Real Property, in each case identifying the owner, lessor and lessee thereof.

                  2.15.2 The Company has good and marketable  title to its Owned
Real Property, free and clear of all Liens, other than as specifically listed in
Section 2.15.2 of the Disclosure Schedule.

                  2.15.3  Subject to the terms of its leases,  the Company has a
valid and subsisting leasehold estate in and the right to quiet enjoyment to the
Leased Real Property for the full term of the lease thereof.  Each Real Property
Lease is a legal,  valid and binding  agreement,  enforceable in accordance with
its terms, of the Company and of each other Person that is a party thereto,  and
except as set forth in Section 2.15.3 of the Disclosure  Schedule,  there is no,
and neither the Sellers nor the Company,  has  knowledge of any, or has received
any,  notice of any default (or any  condition or event  which,  after notice or
lapse of time or both, would constitute a default)  thereunder.  The Company has
not assigned,  sublet,  transferred,  hypothecated or otherwise  disposed of its
interest in any Real Property  Lease.  No penalties are accrued and unpaid under
any Real Property Lease.

                  2.15.4  The  Sellers  shall  deliver  to  Purchaser  upon  the
execution of this Agreement true and complete  copies of all (i) title policies,
mortgages,  deeds of trust, deeds,  leases,  easements,  restrictive  covenants,
certificates of occupancy,  and similar  documents,  and all amendments  thereto
concerning  the Owned Real Property,  and (ii) Real Property  Leases and, to the
extent reasonably  available,  all other documents  referred to in clause (i) of
this paragraph with respect to the Leased Real Property.

                  2.15.5 Except as disclosed in Section 2.15.5 of the Disclosure
Schedule,  the improvements on the Real Property are in good operating condition
and in a state of good maintenance and repair,  ordinary wear and tear excepted,
are adequate and  suitable for the purposes for which they are  presently  being
used and, to the knowledge of each of the Sellers and of the Company,  there are
no condemnation or appropriation  proceedings pending or threatened against Real
Property or the improvements thereon.

                  2.15.6  Neither the Sellers nor the Company has any  knowledge
of any claim, action or proceeding, actual or threatened, against the Company or
the Real  Property by any Person which would  materially  affect the future use,
occupancy or value of the Real Property or any part thereof.

         2.16 Tangible  Personal  Property.  The Company is in possession of and
has good and marketable  title to, or has valid leasehold  interests in or valid
rights under contract to use, all tangible personal property used in the conduct
of its  business,  including  all tangible  personal  property  reflected on the
Financial  Statements and tangible personal property acquired since December 31,
1998 other than property  disposed of since such date in the ordinary  course of
business consistent with past practice and the terms of this Agreement. All such
tangible  personal  property  is free and clear of all  Liens,  other than Liens
disclosed in Section  2.16 of the  Disclosure  Schedule,  and, as of the Closing
Date,  is adequate  and  suitable for the conduct by the Company of the business
presently conducted by it, and is in good working order and condition,  ordinary
wear and tear excepted,  and its use complies in all material  respects with all
applicable Laws.

         2.17 Intellectual Property Rights. The Company has interests in or uses
only the  intellectual  property  described  in Section  2.17 of the  Disclosure
Schedule. The Company either has all right, title and interest in or a valid and
binding  license  to use  such  intellectual  property.  No  other  intellectual
property is used in or  necessary to the conduct of the business of the Company.
All  registrations,   pending  applications,   registered  rights  and  executed
agreements  related to  intellectual  property are listed in Section 2.17 of the
Disclosure Schedule.  Except as disclosed therein, (i) the Company has the right
to use the intellectual  property described  therein,  (ii) all registrations on
behalf of the  Company  with and  applications  to  Governmental  or  Regulatory
Authorities in respect of such intellectual property are valid and in full force
and effect and are not subject to the payment of any Taxes or  maintenance  fees
or the taking of any other actions by the Company to maintain  their validity or
effectiveness,  (iii)  all  copyrightable  materials  used  by the  Company  are
works-for-hire  and are owned by the Company,  (iv) there are no restrictions on
the direct or indirect transfer of any License, or any interest therein, held by
the  Company in respect  of such  intellectual  property,  (v) the  Sellers  has
delivered,  or has caused the  Company to  deliver,  to  Purchaser  prior to the
execution  of  this  Agreement  documentation  with  respect  to any  invention,
process,  design, computer program or other know-how or trade secret included in
such  intellectual  property,  which  documentation is accurate and complete and
sufficient  in detail and  content  to  identify  and  explain  such  invention,
process,  design,  computer program or other know-how or trade secret,  (vi) the
Sellers and the Company have taken reasonable  security  measures to protect the
secrecy,  confidentiality  and value of their trade  secrets,  (vii) neither the
Sellers nor the Company is or has  received any notice that it is in default (or
with the giving of notice or lapse of time or both,  would be in default)  under
any License to use such intellectual property and (viii) neither the Sellers nor
the Company has any knowledge that such intellectual property is being infringed
by any other  Person.  To the  knowledge  of the  Sellers and the  Company,  the
Company is not  infringing  any  intellectual  property  of any  Person,  and no
litigation is pending and no claim has been made or, to the knowledge of any the
Sellers or of the Company, has been threatened to such effect.

         2.18     Contracts.

                  2.18.1  Section  2.18.1  of  the  Disclosure   Schedule  (with
paragraph references corresponding to those set forth below) contains a true and
complete list of each of the following Contracts or other arrangements (true and
complete  copies,  or,  if  none,   reasonably  complete  and  accurate  written
descriptions of which,  together with all amendments and supplements thereto and
all waivers of any terms thereof,  have been delivered to Purchaser prior to the
execution of this Agreement), to which the Company is a party or by which any of
its Assets is bound.

                           2.18.1.1 (A) all Contracts  (excluding Benefit Plans)
providing  for  a  commitment  of  employment  or  consultation  services  for a
specified or unspecified  term, the name,  position and rate of  compensation of
each  Person  party to such a  Contract  and the  expiration  date of each  such
Contract;  and  (B)  any  written  or  unwritten  representations,  commitments,
promises,  communications  or courses of conduct  involving an obligation of the
Company to make payments  (with or without  notice,  passage of time or both) to
any  Person  in  connection  with,  or as a  consequence  of,  the  transactions
contemplated  hereby or to any  employee,  other than with  respect to salary or
incentive  compensation  payments in the ordinary course of business  consistent
with past practice;

                           2.18.1.2 all Contracts with any Person containing any
provision  or covenant  prohibiting  or  limiting  the ability of the Company to
engage in any  business  activity or compete with any Person or  prohibiting  or
limiting the ability of any Person to compete with the Company or prohibiting or
limiting disclosure of confidential or proprietary information;

                           2.18.1.3    all    partnership,     joint    venture,
shareholders' or other similar Contracts with any Person;

                           2.18.1.4 all Contracts  relating to  Indebtedness  of
the Company;

                           2.18.1.5 all Contracts with independent  contractors,
distributors,   dealers,  manufacturers'  representatives,   sales  agencies  or
franchisees;

                           2.18.1.6 all guarantees of any  Indebtedness or other
obligations of the Company or any third Person;

                           2.18.1.7  all   Contracts   relating  to  the  future
disposition  or  acquisition  of  any  Assets,   other  than   dispositions   or
acquisitions  in the ordinary  course of business  consistent with past practice
and the provisions of this Agreement;

                           2.18.1.8 all  Contracts  between or among the Company
and any of the Sellers, any current or former officer, director,  stockholder or
Affiliate  of the  Company  or of any such  officer,  director,  stockholder  or
Affiliate, on the other hand, other than Contracts disclosed pursuant to Section
2.18.1.8;

                           2.18.1.9 all  collective  bargaining or similar labor
Contracts;

                           2.18.1.10  all  Contracts  that (A) limit or  contain
restrictions  on the ability of the Company to declare or pay  dividends  on, to
make any other  distribution  in respect of or to issue or  purchase,  redeem or
otherwise acquire its capital stock, to incur  Indebtedness,  to incur or suffer
to exist any Lien,  to  purchase  or sell any  Assets or to change  the lines of
business,  (B) require the Company to  maintain  specified  financial  ratios or
levels of net worth or other  indicia of financial  condition or (C) require the
Company to maintain insurance in certain amounts or with certain coverages; and

                           2.18.1.11  all  other  Contracts,  including  but not
limited to  Contracts  with  customers,  that  involve the payment or  potential
payment,  pursuant  to the terms of any such  Contract,  by or to the Company of
more than  $10,000  and all powers of attorney  and  comparable  delegations  of
authority.

                  2.18.2  Each  Contract  required  to be  disclosed  in Section
2.18.1 of the Disclosure  Schedule is in full force and effect and constitutes a
legal, valid and binding agreement, enforceable in accordance with its terms, of
each party thereto;  and except as disclosed in Section 2.18.2 of the Disclosure
Schedule,  neither the Company nor, to the  knowledge  of any the  Sellers,  any
other party to such Contract is, or has received notice that it is, in violation
or breach of or default under any such Contract (or with notice or lapse of time
or both, would be violation or breach of or default under any such Contract).

                  2.18.3 Except as disclosed in Section 2.18.3 of the Disclosure
Schedule,  the Company is not a party to or bound by any Contract  that has been
or could reasonably be expected to be, individually or in the aggregate with any
other such  Contracts,  materially  adverse to the  business or condition of the
Company.

                  2.18.4 To the extent any of the  guaranties for the benefit of
the Company or any of its Assets are not integrated with Contracts  disclosed in
Section 2.18.1 to the Disclosure  Schedule,  each such guaranty is in full force
and effect and constitutes a legal, valid and binding agreement,  enforceable in
accordance  with its terms,  or each party  thereto;  and neither the  guarantor
thereunder  nor,  to the  knowledge  of the  Sellers or the Company or any other
party to such  guaranty is, or has  received  notice that it is, in violation or
breach of or default under any such guaranty (or with notice or lapse of time or
both, would be in violation or breach of default under any such guaranty).

         2.19 Licenses.  Section 2.19 of the Disclosure Schedule contains a true
and  complete  list of all  Licenses  used in and  material  to the  business or
operations  of the  Company,  setting  forth the  owner,  the  function  and the
expiration and renewal date of each.  Prior to the execution of this  Agreement,
the Sellers or the Company have delivered to Purchaser true and complete  copies
of all such  Licenses.  Except as disclosed  in Section  2.19 of the  Disclosure
Schedule:

                  2.19.1 the Company owns or validly holds all Licenses that are
material to its respective business or operations;

                  2.19.2 each license  listed in Section 2.19 of the  Disclosure
Schedule is valid, binding and in full force and effect;

                  2.19.3 neither the Sellers nor the Company is, or has received
any notice  that it is in default (or with the giving of notice of lapse of time
or both, would be in default) under any such License; and

                  2.19.4 the  transactions  contemplated  in this Agreement will
not violate any such License or give any other party thereto rights to terminate
the License or change the terms thereof.

         2.20 Insurance. Section 2.20 of the Disclosure Schedule contains a true
and complete list  (including the names of the insurers,  the  expiration  dates
thereof,  the period of time  covered  thereby  and a brief  description  of the
interests insured thereby) of all liability,  property,  workers'  compensation,
directors' and officers'  liability and other  insurance  policies  currently in
effect that  insure the  business,  operations  or  employees  of the Company or
affect or relate to the ownership,  use or operation of any of the Assets of the
Company and that (i) have been issued to the  Company,  or (ii) have been issued
to any Person  (other than the  Company)  for the benefit of the  Company.  Each
policy  listed in Section 2.20 of the  Disclosure  Schedule is valid and binding
and in full force and effect,  all premiums due  thereunder  have been paid when
due and  neither  the  Sellers nor the Company or the Person to whom such policy
has been  issued has  received  any notice of  cancellation  or  termination  in
respect of any such policy or is in default thereunder, and the Company does not
know of any reason or state of facts that could lead to the cancellation of such
policies.  The  insurance  policies  listed in  Section  2.20 of the  Disclosure
Schedule (i) in light of the business,  operations and Assets of the Company are
in amounts and have  coverages  that are  reasonable  and  customary for Persons
engaged in such businesses and operations and having such Assets and (ii) are in
amounts and have coverages as required by any Contract to which the Company is a
party.  Section 2.20 of the  Disclosure  Schedule  contains a list of all claims
made under any  insurance  policies  covering the Company since January 1, 1995.
Neither the Sellers nor the Company have received  notice that any insurer under
any policy  referred to in this Section is denying  liability  with respect to a
claim  thereunder  or defending  under a  reservation  of rights  clause.  Since
January 1, 1995, the Company has maintained, in light of its business, location,
operations and Assets, at all times, without interruption appropriate insurance,
in scope and amount of coverages.

         2.21 Affiliate Transactions. Except for the Shareholder Debt, (i) there
are no  Liabilities  between  the  Company  and any  current or former  officer,
director,  stockholder,  Affiliate  of the Company or any  Affiliate of any such
officer,  director,  stockholder  or  Affiliate,  and (ii) the Company  does not
provide or cause to be provided any assets,  services or  facilities to any such
current or former officer, director, stockholder or Affiliate.

         2.22  Employees;  Labor  Relations.  The  Company is not engaged in any
unfair labor practice.  There is (i) no unfair labor practice  complaint pending
or, to the  knowledge  of the  Sellers or the  Company,  threatened  against the
Company before the National Labor Relations Board or comparable or similar state
agency,  and no  grievance  or  arbitration  proceeding  arising  out  of  under
collective  bargaining  agreements  is so pending  or, to the  knowledge  of the
Sellers or of the Company, threatened against the Company, (ii) no strike, labor
dispute, slowdown or stoppage pending or, to the knowledge of the Sellers or the
Company,  threatened  against  the  Company,  and (iii) no union  representation
question  exists  with  respect  to the  employees  of the  Company  or,  to the
knowledge of the Sellers or the Company,  no union  organization  activities are
taking place.

         2.23     Environmental Matters.

                  2.23.1  The  Company  has  obtained  and holds  all  necessary
Environmental Permits.

                  2.23.2 Except as disclosed in Section 2.23.2 of the Disclosure
Schedule,  to the best  knowledge  of the  Sellers  with no duty of  independent
investigation:

                           2.23.2.1  The  Company is, and at all times has been,
in full  compliance  with, and has not been and is not in violation of or liable
under, any Environmental  Law. Neither the Sellers nor the Company has any basis
to expect, nor has any of them or any other Person for whose conduct they may be
held to be responsible  received,  any actual or threatened  Order,  notice,  or
other  communication from (A) any Governmental Body or private citizen acting in
the public  interest,  or (B) the  current  or prior  owner or  operator  of any
Facilities,  of any actual or potential  violation or failure to comply with any
Environmental  Law, or of any actual or  threatened  obligation  to undertake or
bear the cost of any Environmental,  Health, and Safety Liabilities with respect
to any of the  Facilities  or any  other  properties  or assets  (whether  real,
personal, or mixed) in which the Company has had an interest, or with respect to
any  property or Facility at or to which  Hazardous  Materials  were  generated,
manufactured,  refined, transferred, imported, used, or processed by the Company
or any other Person for whose  conduct they are or may be held  responsible,  or
from which Hazardous Materials have been transported,  treated, stored, handled,
transferred, disposed, recycled, or received.

                           2.23.2.2 There are no pending or, to the knowledge of
the  Sellers  or  the  Company,  threatened  claims,   encumbrances,   or  other
restrictions of any nature, resulting from any Environmental, Health, and Safety
Liabilities or arising under or pursuant to any Environmental  Law, with respect
to or  affecting  any of the  Facilities  or any  other  properties  and  assets
(whether  real,  personal,  or mixed) in which the Sellers or the Company has or
had an interest.

                           2.23.2.3  Neither  the  Sellers  nor the  Company has
knowledge of or any basis to expect, nor has any of them or any other Person for
whose  conduct  they  are or may be  held  responsible  received  any  citation,
directive,  inquiry,  notice, Order,  summons,  warning, or other communications
that relates to Hazardous Activity, Hazardous Materials, or any alleged, actual,
or potential  violation or failure to comply with any  Environmental  Law, or of
any  Environmental,  Health,  and Safety  Liabilities with respect to any of the
Facilities  or any other  Assets in which the Company had an  interest,  or with
respect to any Facility to which Hazardous  Materials  generated,  manufactured,
refined, transferred,  imported, used, or processed by the Sellers, the Company,
or any other Person for whose conduct it or they are or may be held responsible,
have  been  transported,   treated,  stored,  handled,  transferred,   disposed,
recycled, or received.

                           2.23.2.4 Neither the Company nor any other Person for
whose conduct it may be held responsible,  has any  Environmental,  Health,  and
Safety  Liabilities  with respect to the Facilities or with respect to any other
Assets  (whether  real,  personal,  or  mixed)  in  which  the  Company  (or any
predecessor thereof), has or had an interest, or at any property geologically or
hydrologically adjoining the Facilities or any such Assets.

                  2.23.3 There are no Hazardous  Materials  present on or in the
Environment at the Facilities or at any geologically or hydrologically adjoining
property,  including  any  Hazardous  Materials  contained in barrels,  above or
underground storage tanks, landfills,  land deposits,  dumps, equipment (whether
moveable or fixed) or other  containers,  either  temporary  or  permanent,  and
deposited or located in land, water,  sumps, or any other part of the Facilities
or such  adjoining  property,  or  incorporated  into any  structure  therein or
thereon.  Neither the Company nor any other  Person for whose  conduct it may be
held responsible,  or any other Person, has permitted or conducted,  or is aware
of, any Hazardous Activity conducted with respect to the Facilities or any other
properties or assets (whether real, personal,  or mixed) in which the Sellers or
the Company has or had an interest except in full compliance with all applicable
Environmental Laws.

                  2.23.4  There has been no Release or, to the  knowledge of the
Sellers or of the Company,  any threat of Release of any Hazardous  Materials at
or from the Facilities or at any other locations  where any Hazardous  Materials
were generated, manufactured, refined, transferred, produced, imported, used, or
processed  from or by the  Facilities,  or from or by any other  properties  and
assets  (whether  real,  personal,  or mixed) in which the Company has or had an
interest, or any geologically or hydrologically adjoining property.

                  2.23.5  The  Sellers  has  delivered  to  Purchaser  true  and
complete  copies and  results of any  reports,  studies,  analyses,  tests,  and
monitoring  possessed or initiated by the Sellers or the Company  pertaining  to
Hazardous Materials or Hazardous Activities in, on, or under the Facilities,  or
concerning  compliance by the Sellers, the Company or any other Person for whose
conduct it or they are or may be held responsible, with Environmental Laws.

                  2.23.6  There are no Liens  arising  under or  pursuant to any
Environmental  Law on any Owned Real  Property or Leased Real Property and there
are no facts, circumstances,  or conditions that could reasonably be expected to
restrict, encumber, or result in the imposition of special conditions that could
reasonably  be expected to restrict,  encumber,  or result in the  imposition of
special  conditions under any  Environmental  Law with respect to the ownership,
occupancy, development, use, or transferability of any Real Property.

                  2.23.7 There are no (i) underground  storage tanks,  active or
abandoned, (ii) polychlorinated biphenyl containing equipment, or (iii) asbestos
containing material, at any Real Property.

                  2.23.8  There  have  been  no  environmental   investigations,
studies, audits, tests, reviews or other analyses conducted by, on behalf of, or
which are in the  possession  of the Sellers or the Company  with respect to any
Asset of, or property that is adjacent to an Asset of the Company which have not
been delivered to Purchaser prior to execution of this Agreement.

         2.24  Substantial  Customers  and  Suppliers.  Section  2.24.1  of  the
Disclosure  Schedule lists the ten (10) largest  customers of the Company on the
basis of  revenues  for goods sold or  services  provided  for the twelve  month
period ending December 31, 1998. Section 2.24.2 of the Disclosure Schedule lists
the ten (10)  largest  suppliers of the Company on the basis of cost of goods or
services  purchased  during the twelve  month period  ending  December 31, 1998.
Except as  disclosed  in  Section  2.24.3  of the  Disclosure  Schedule,  to the
knowledge  of the  Sellers  and the  Company,  no such  customer  or supplier is
insolvent or threatened with bankruptcy or insolvency.

         2.25  Accounts  Receivable.  Except as set forth in Section 2.25 of the
Disclosure Schedule,  the accounts and notes receivable of the Company reflected
on the balance sheets included in the Financial  Statements for the period ended
December 31, 1998, and all accounts and notes receivable  arising  subsequent to
such date, (i) arose from bona fide sales transactions in the ordinary course of
business  consistent with past practice and are payable on ordinary trade terms,
(ii)  are  legal,  valid  and  binding  obligations  of the  respective  debtors
enforceable in accordance with their respective terms,  (iii) are not subject to
any valid set-off or counterclaim,  (iv) do not represent  obligations for goods
sold on consignment,  on approval or on a sale-or-return basis or subject to any
other repurchase or return arrangements,  and (v) are not subject of any Actions
or  Proceedings  brought  by or on behalf of the  Company.  Section  2.25 of the
Disclosure  Schedule sets forth (x) a description  of any security  arrangements
and collateral  securing the repayment or other  satisfaction  of receivables of
the Company and (y) all  jurisdictions in which the records relating to accounts
and notes receivable are located.

         2.26 Other Negotiations; Brokers. Neither the Sellers, nor the Company,
nor any of their  respective  Affiliates (nor any investment  banker,  financial
advisor,  attorney,  accountant or other Person  retained by or acting for or on
behalf of the Sellers or the Company or any such Affiliate) has entered into any
agreement or had any discussions  with any third party regarding any transaction
involving  the  Company  which could  result in the  Company,  Purchaser  or its
stockholders,  or any officer, director,  employee, agent or Affiliate of any of
them,  being  subject to any claim for liability to said third party as a result
of entering into this Agreement or consummating  the  transactions  contemplated
hereby or  thereby.  No agent,  broker,  finder,  investment  banker,  financial
advisor  or  other  Person  will be  entitled  to any fee,  commission  or other
compensation in connection with the transactions  contemplated by this Agreement
on the basis of any act or statement made by the Sellers,  the Company or any of
their  respective  Affiliates,  or any  investment  banker,  financial  advisor,
attorney,  accountant or other Person  retained by or acting for or on behalf of
the Sellers, the Company, or any such Affiliate.

         2.27 Holding Company Act and Investment Company Act Status. The Company
is not a  "holding  company"  or a "public  utility  company"  as such terms are
defined in the Public  Utility  Company Act of 1935, as amended.  The Company is
not an "investment company" or a company "controlled" by an "investment company"
within the meaning of the Investment Company Act of 1940, as amended.

         2.28  Bank  and  Brokerage  Accounts.  Section  2.28 of the  Disclosure
Schedule  sets  forth  (a) a list  of the  names  and  locations  of all  banks,
securities brokers and other financial  institutions at which the Company has an
account or safe deposit box or maintains a banking, custodial,  trading or other
similar  relationship;  and (b) a true and complete list and description of each
such account,  box and relationship,  indicating in each case the account number
and the names of all persons having signatory power and respect thereto.

         2.29 Exemption from  Registration.  The offer and sale of the Purchased
Stock  made  pursuant  to  this  Agreement  are  exempt  from  the  registration
requirements of the Securities Act. Neither any the Sellers, nor the Company nor
any  Person  authorized  to act on  behalf  of any  of  the  foregoing  has,  in
connection with the offering of the Purchased Stock,  engaged in (i) any form of
general  solicitation or general advertising (as those terms are used within the
meaning of Rule 501(c) under the Securities  Act),  (ii) any action  involving a
public  offering  within the meaning of section 4(2) of the  Securities  Act, or
(iii) any action that would require the registration under the Securities Act of
the offering and sale of the Purchased  Stock pursuant to this Agreement or that
would violate applicable state securities or "blue sky" laws.

         2.30 Disclosure.  The representations and warranties  contained in this
Agreement,  and the statements  contained in the  Disclosure  Schedule or in the
certificates,  lists and other writings  furnished to Purchaser  pursuant to any
provision of this  Agreement  (including the Financial  Statements),  when taken
together,  do not contain  any untrue  statement  of a material  fact or omit to
state a  material  fact  necessary  in order to make the  statements  herein and
therein,  in the light of the  circumstances  under  which they were  made,  not
misleading.

         2.31 Survival of Representations, Warranties, Covenants and Agreements.
Even though the Purchaser may investigate the affairs of the Company and attempt
to confirm the accuracy of the  representations  and  warranties of the Sellers,
the  Purchaser,  nonetheless,  shall  have  the  right  to rely  fully  upon the
representations,  warranties,  covenants and agreements of the Sellers contained
in  this  Agreement.  All  such  representations,   warranties,   covenants  and
agreements will survive the Closing.

                                   ARTICLE III

3        REPRESENTATIONS AND WARRANTIES OF PURCHASER

         Purchaser,  to its  best  knowledge,  represents  and  warrants  to the
Sellers as follows:

         3.1  Organization  and  Qualification.  Purchaser is a corporation duly
organized,  validly existing and in good standing under the laws of the state of
its  incorporation.  Purchaser  is duly  qualified,  licensed  or admitted to do
business and is in good standing in each  jurisdiction  in which the  ownership,
use or leasing of its Assets,  or the conduct or nature of its  business,  makes
such qualification,  licensing or admission necessary,  except for such failures
to  be  so  qualified,   licensed  or  admitted  and  in  good  standing  which,
individually  or in the  aggregate,  could not be reasonably  expected to have a
material adverse effect on the validity or  enforceability  of this Agreement or
on the ability of Purchaser to perform its obligations hereunder or thereunder.

         3.2 Authority Relative to this Agreement.  Purchaser has full corporate
power and authority to enter into this Agreement and to perform its  obligations
hereunder and to consummate the transactions contemplated hereby. The execution,
delivery and performance of this Agreement by Purchaser and the  consummation by
Purchaser  of the  transactions  contemplated  hereby have been duly and validly
approved by its board of directors  and no other  corporate  proceedings  on the
part of Purchaser or its  stockholders are necessary to authorize the execution,
delivery and performance of this Agreement by Purchaser and the  consummation by
Purchaser of the transactions  contemplated hereby. This Agreement has been duly
and validly  executed and delivered by Purchaser and constitutes a legal,  valid
and binding obligation of Purchaser  enforceable against Purchaser in accordance
with its terms.

         3.3 No  Conflicts.  The  execution  and  delivery by  Purchaser of this
Agreement does not, and the  performance by Purchaser of its  obligations  under
this Agreement and the consummation of the transactions  contemplated hereby, do
not and will not:

                  3.3.1  conflict or result in a  violation  or breach of any of
the terms,  conditions or  provisions of the  certificate  of  incorporation  or
by-laws of Purchaser;

                  3.3.2  subject  to  obtaining  the  consents,   approvals  and
actions,  making the filings and giving the notices  disclosed in Section 3.4 of
the  Disclosure  Schedule,  if any,  conflict  with or result in a violation  or
breach of any term or provision of any Law or Order  applicable  to Purchaser or
its Assets and Properties; or

                  3.3.3 except as disclosed in Section  3.3.3 of the  Disclosure
Schedule,  (i)  conflict  with or  result in a  violation  or  breach  of,  (ii)
constitute (with or without notice or lapse of time or both) a default under, or
(iii) require  Purchaser to obtain any consent,  approval or action of, make any
filing  with or give any  notice to any Person as a result or under the terms of
any Contract or License to which Purchaser is a party, or by which it is bound.

         3.4 Governmental Approvals and Filings.  Except as disclosed in Section
3.4 of the  Disclosure  Schedule,  other than  filings  with the  Federal  Trade
Commission  and the United  States  Department of Justice under HSR, no consent,
approval or action of, filing with or notice to any  Governmental  or Regulatory
Authority on the part of Purchaser is required in connection with the execution,
delivery  and  performance  of this  Agreement  to  which  it is a party  or the
consummation of the transactions contemplated herein.

         3.5 Legal Proceedings.  There are no Actions or Proceedings pending or,
to the  knowledge of  Purchaser,  threatened  against,  relating to or affecting
Purchaser or any of its Assets which (i) could  reasonably be expected to result
in the issuance of an Order restraining,  enjoining or otherwise  prohibiting or
making illegal the consummation of any of the transactions  contemplated by this
Agreement,  or  (ii)  could  reasonably  be  expected,  individually  or in  the
aggregate  with other such Actions or  Proceedings,  to have a material  adverse
effect on the business or condition of Purchaser.

         3.6 Brokers. No agent,  broker,  finder,  investment banker,  financial
advisor or other similar Person will be entitled to any fee, commission or other
compensation  in connection  with any of the  transactions  contemplated by this
Agreement on the basis of any act or statement made by Purchaser.

         3.7 Purchase for  Investment.  The Purchased  Stock will be acquired by
Purchaser for its own account for the purpose of investment  and not with a view
to the  resale  or  distribution  of all or any part of the  Purchased  Stock in
violation of the Securities Act.

         3.8 Survival of Representations,  Warranties, Covenants and Agreements.
Even though the Sellers may investigate the affairs of the Purchaser and confirm
the accuracy of the representations and warranties of the Purchaser contained in
this  Agreement,  the Sellers,  nonetheless,  shall have the right to rely fully
upon the representations,  warranties, covenants and agreements of the Purchaser
contained in this Agreement. All such representations, warranties, covenants and
agreements will survive the Closing.

                                   ARTICLE IV

4        COVENANTS BY THE SELLERS

         4.1      Noncompetition; Non Solicitation.

                  4.1.1 For a period of five (5) years  from the  Closing  Date,
each of the Sellers,  alone or in conjunction with any other Person, or directly
or indirectly through their present or future  Affiliates,  will not directly or
indirectly own, manage,  operate, join, have a financial interest in, control or
participate  in the  ownership,  management,  operation or control of, or use or
permit his name to be used in connection with, or be otherwise  connected in any
manner with any  business  or  enterprise  engaged in the  design,  development,
manufacture,  distribution  or sale of any  products,  or the  provision  of any
services,   which  the  Company  was   designing,   developing,   manufacturing,
distributing,  selling or providing at any time prior to and up to and including
the Closing Date  anywhere in the State of Montana,  provided that the foregoing
restriction shall not be construed to prohibit the ownership,  in the aggregate,
of not more than two percent (2%) of any class of securities of any  corporation
which is engaged in any of the businesses or enterprises described above, having
a class of  securities  registered  pursuant to the  Securities  Exchange Act of
1934, as amended,  which  securities are publicly owned and regularly  traded on
any national exchange or in the over-the-counter market.

                  4.1.2 For a period of five (5) years  from the  Closing  Date,
the Sellers  shall not  directly or  indirectly,  or through an  Affiliate,  (i)
influence any individual who was an employee or consultant of the Company at any
time, to terminate his or her  employment  or consulting  relationship  with the
Company,  (ii)  interfere  in any  other  way  with  the  employment,  or  other
relationship,  of any  employee or  consultant  of the Company or (iii) cause or
attempt to cause or  participate  in any way in any  discussion  or  negotiation
concerning  (x) any  client,  customer  or  supplier  of the  Company or (y) any
prospective  client,  customer  or  supplier  of the  Company  from  engaging in
business with the Company.

                  4.1.3 The Sellers agree that  Purchaser's  remedies at law for
any breach or threat of breach by it of any of the  provisions  of this  Section
4.1 will be  inadequate,  and that,  in  addition  to any other  remedy to which
Purchaser may be entitled at law or in equity,  Purchaser shall be entitled to a
temporary or permanent injunction or injunctions or temporary restraining orders
or orders to prevent  breaches  of the  provisions  of this  Section  4.1 and to
enforce  specifically the terms and provisions  hereof, in each case without the
need to post any security or bond.  Nothing herein  contained shall be construed
as  prohibiting  Purchaser  from  pursuing,  in  addition,  any  other  remedies
available to it for such breach or threatened  breach. A waiver by the Purchaser
of any breach of any  provision  hereof  shall not operate or be  construed as a
waiver  of a  breach  of  any  other  provisions  of  this  Agreement  or of any
subsequent breach thereof.

                  4.1.4 The parties hereto consider the  restrictions  contained
in this Section 4.1 hereof to be reasonable  for the purpose of  preserving  the
goodwill,  proprietary  rights and going concern value of the Company,  but if a
final judicial  determination  is made by a court having  jurisdiction  that the
time or territory or any other  restriction  contained in this Section 4.1 is an
unenforceable  restriction  on the Sellers'  activities,  the provisions of this
Section 4.1 shall not be rendered  void but shall be deemed  amended to apply as
to such  maximum time and  territory  and to such other extent as such court may
judicially determine or indicate to be reasonable.  Alternatively,  if the court
referred to above finds that any  restriction  contained  in this Section 4.1 or
any remedy  provided  herein is  unenforceable,  and such  restriction or remedy
cannot be amended so as to make it  enforceable,  such finding  shall not affect
the  enforceability  of any of the other  restrictions  contained therein or the
availability of any other remedy. The provisions of this Section 4.1 shall in no
respect  limit  or  otherwise  affect  the  Sellers's  obligations  under  other
agreements with the Company.

         4.2 Regulatory and Other Approvals.  The Sellers shall, and shall cause
the Company to, (a) take all necessary or desirable steps and proceed diligently
and in good faith and use its best  efforts,  as  promptly  as  practicable,  to
obtain all  consents,  approvals  or actions of, to make all filings with and to
give all notices to, Governmental or Regulatory  Authorities or any other Person
required to consummate the transactions  contemplated hereby and those described
in Sections  2.5 and 2.6 of the  Disclosure  Schedule,  (b)  provide  such other
information and communications to such Governmental or Regulatory Authorities or
other Persons as Purchaser or such  Governmental  or Regulatory  Authorities  or
other  Persons  may  reasonably  request and (c)  cooperate  with  Purchaser  as
promptly as  practicable  in obtaining  all  consents,  approvals or actions of,
making all filings with and giving all notices to,  Governmental  or  Regulatory
Authorities   or  other  Persons   required  of  Purchaser  to  consummate   the
transactions  contemplated  hereby. the Sellers will provide prompt notification
to Purchaser when any such consent,  approval, action, filing or notice referred
to in clause (a) above is obtained,  taken,  made or given,  as applicable,  and
will advise  Purchaser  of any  communications  (and,  unless  precluded by Law,
provide  copies  of any  such  communications  that  are in  writing)  with  any
Governmental  or  Regulatory  Authority  or other  Person  regarding  any of the
transactions contemplated by this Agreement.

         4.3      Investigation by Purchaser.

                  4.3.1 From the date of this Agreement  until the date on which
either Party provides the other Party with written notice that this Agreement is
terminated (the "Termination Date"), or until the Closing, whichever is earlier,
the  Sellers  will afford  Purchaser's  accountants,  and their  representatives
access to certain contracts, books and records, and all other documents and data
of the Company, other than formulas and manufacturing procedural instructions of
the Company  and  certain  other  documents  and data that the Sellers  will not
disclose until Closing,  such as certain of the vendors of the Company or prices
paid  for  certain  products  connected  with  certain  formulas,  manufacturing
processes,   bagging  operations  and  acrylic  stucco  division  processes  and
operations, as well as employee files and records. Sellers will advise Purchaser
what is not being disclosed as Purchaser's investigation proceeds.

                  4.3.2 From the date of this  Agreement  until the  Termination
Date,  or until the  Closing,  whichever  is earlier,  the  Sellers  will afford
Purchaser,  its employees,  agents and  representatives  full and free access to
certain books and records of the Company as provided in Section 4.3.1 hereof. To
the extent  that any such  books and  records  are not  furnished  to  Purchaser
immediately, the same shall nevertheless be furnished to Purchaser at a mutually
agreeable  time,  not  later  than  one  day  prior  to the  Closing.  Purchaser
acknowledges  that certain of the books and records are highly  confidential and
their  disclosure will not be made except as provided herein due to the Sellers'
confidentiality and proprietary concerns.  Sellers will advise Purchaser what is
not being disclosed as Purchaser's  investigation proceeds. In any event, if any
of this highly confidential information is disclosed to Purchaser prior to or at
the Closing, Purchaser shall have the option to terminate this Agreement, at its
sole discretion,  if the highly  confidential  information  discloses any matter
which leads Purchaser to the conclusion that it should not close the transaction
contemplated herein.

                                    ARTICLE V

5        CLOSING CONDITIONS

         5.1 Condition to the  Obligations of the Purchaser.  The obligations of
Purchaser  hereunder  to  purchase  the  Purchased  Stock  are  subject  to  the
fulfillment,  at or prior to the Closing, of the following  conditions precedent
(any or all of which may be waived in whole or in part by  Purchaser in its sole
discretion):

                  5.1.1   Representations   and   Warranties.    Each   of   the
representations  and warranties  made by the Sellers in this Agreement  shall be
true and correct in all material  respects as of the date of this  Agreement and
on and as of the Closing  Date as though each such  representation  and warranty
was made on and as of the Closing Date.

                  5.1.2  Performance.  The  Sellers  shall  have  performed  and
complied with each agreement, covenant and obligation required by this Agreement
to be so performed or complied with by them at or before the Closing.

                  5.1.3 Orders and Laws. There shall not be pending,  threatened
or in effect on the  Closing  Date any Order or Law  restraining,  enjoining  or
otherwise  prohibiting  or  making  illegal  the  consummation  of  any  of  the
transactions  contemplated  by this  Agreement  or  which  could  reasonably  be
expected to  otherwise  result in a material  diminution  of the benefits of the
transactions contemplated by this Agreement to Purchaser.

                  5.1.4  Regulatory   Consents  and  Approvals.   All  consents,
approvals  and  actions of,  filings  with and  notices to any  Governmental  or
Regulatory  Authority  necessary to permit  Purchaser and the Sellers to perform
their  obligations  under this  Agreement  and to  consummate  the  transactions
contemplated hereby (i) shall have been duly obtained, made or given, (ii) shall
be in form and substance reasonably  satisfactory to Purchaser,  (iii) shall not
impose any limitations or  restrictions on Purchaser,  (iv) shall not be subject
to the satisfaction of any condition that has not been satisfied or waived,  and
(v) shall be in full force and effect,  and all  terminations  or expirations of
waiting periods imposed by any  Governmental or Regulatory  Authority  necessary
for the consummation  for the transactions  contemplated by this Agreement shall
have occurred.

                  5.1.5  Third  Party   Consents.   Any  consents  (or  waivers)
identified in Section 2.5 of the Disclosure Schedule, and all other consents (or
waivers) to the  performance  by the  Purchaser  of its  obligations  under this
Agreement,  or to the consummation for the transactions  contemplated  hereby as
are required  under any Contract or License to which the Purchaser is a party or
by which any of its  Assets  are bound and where the  failure to obtain any such
consent (or in lieu thereof waiver) could  reasonably be expected,  individually
or in the aggregate with other such failures, to materially adversely affect the
Purchaser or the  business or condition of the Company or otherwise  result in a
material  diminution of the benefits of the  transactions  contemplated  by this
Agreement to the Purchaser in its sole discretion, (i) shall have been obtained,
(ii) shall be in form and  substance  satisfactory  to the Purchaser in its sole
discretion, (iii) shall not be subject to the satisfaction of any condition that
has not been satisfied or waived and (iv) shall be in full force and effect.

                  5.1.6  Purchaser's  Investigation.  Purchaser  shall  not have
discovered,  as a result of its investigation and review pursuant to Section 4.3
hereof,  any  condition  (financial  or  otherwise)  relating  in any way to the
Company, its Assets,  business or prospects,  that convinces  Purchaser,  in its
sole discretion, that it is not advisable to complete the Closing.

                  5.1.7 Sellers' Certificates.  The Sellers shall have delivered
to  Purchaser  (i)  certificates,  dated the  Closing  Date and  executed  by an
executive officer of the Company, substantially in the form and to the effect of
Exhibit B hereto and (ii)  certificates,  dated the Closing Date and executed by
the chief financial officer of the Company, substantially in the form of Exhibit
C hereto.

                  5.1.8  Resignations  of Officers  and  Directors.  The Sellers
shall have delivered to Purchaser the  resignations of all current  officers and
directors of the Company, effective as of the Closing Date.

                  5.1.9  Opinion of Counsel.  Purchaser  shall have received the
opinion of ________________ , Esquire, counsel to the Company in connection with
this  Agreement,  dated the Closing Date,  substantially  in the form and to the
effect  of  Exhibit D  hereto,  and to such  further  effect  as  Purchaser  may
reasonably request.

                  5.1.10 Disclosure  Schedule.  The Sellers shall have delivered
to Purchaser a copy of the Disclosure Schedule,  updated and current through the
Closing Date.

                  5.1.11 Good  Standing  Certificates.  The  Sellers  shall have
delivered  to  Purchaser   (i)  copies  of  the   certificate   or  articles  of
incorporation (or other comparable  corporate charter documents),  including all
amendments thereto of the Company certified by the applicable Secretary of State
or  other  appropriate   governmental  official,   (ii)  certificates  from  the
applicable Secretary of State or other appropriate  governmental official to the
effect that the Company is in good  standing in such  jurisdiction,  listing all
charter  documents  of the Company on file and  attesting  to its payment of all
franchise or similar Taxes, and (iii)  certificates  from the Secretary of State
or other  appropriate  official  in each  jurisdiction  in which the  Company is
qualified  or  admitted  to do  business  to the effect that the Company is duly
qualified or admitted in good standing in such jurisdiction.

                  5.1.12 Receipt of Purchased Stock.  Certificates  representing
the Purchased Stock shall have been  transferred to Purchaser in accordance with
the terms of this Agreement.

                  5.1.13  Payment  of   Indebtedness.   Purchaser  must  receive
evidence  satisfactory to Purchaser that upon payment of the Purchase Price, (i)
all  Shareholder  Debt will be cancelled or otherwise paid in full, and be of no
further force and effect,  (ii) all other Indebtedness owing by the Company will
be  retired,  released or repaid,  and (iii) the Company has been  conditionally
released from all obligations it has in respect of (i) and (ii) above.

                  5.1.14  No  Adverse  Change.  There  shall  have  occurred  no
material  adverse  change in the business or  condition  of the Company  between
December 31, 1998 and the Closing Date.

                  5.1.15 Inventory.  The silos and tanks at the Corette facility
being  filled with  marketable  fly ash to within 80% of capacity at the time of
the Closing; and

                  5.1.16 Contract Extension.  The Sellers shall obtain, prior to
the  Closing,  an executed  extension of the  contracts  between the Company and
Montana Power & Light and the Company and Montana Dakota Utilities (collectively
the  "Contracts").  The  Contracts  must be extended for a period of at least an
additional  five (5) years,  preferably ten (10),  with  substantially  the same
terms  and  conditions  as  those  in  existence  as of the  execution  of  this
Agreement.  The Montana Power & Light  contract shall provide for a term of five
(5) years from the date that the ash generated at the Colstrip  facility becomes
marketable.

         5.2 Conditions to the  Obligations of the Sellers.  The  obligations of
the Sellers  hereunder to sell the Purchased  Stock to the Purchaser are subject
to the  fulfillment,  at or prior to the Closing,  of the  following  conditions
precedent  (any or all of which may be waived in whole or in part by the Sellers
in theirs sole discretion):

                  5.2.1   Representations   and   Warranties.    Each   of   the
representations and warranties made by Purchaser in this Agreement shall be true
and correct in all material respects as of the date of this Agreement and on and
as of the Closing Date as though each such  representation and warranty was made
on and as of the Closing Date.

                  5.2.2 Performance. Purchaser shall have performed and complied
with, in all material respects, each agreement, covenant and obligation required
by this  Agreement to be so performed or complied with by Purchaser at or before
the Closing.

                  5.2.3 Orders and Laws. There shall not be pending,  threatened
or in effect on the Closing  Date any Orders or Laws  restraining,  enjoining or
otherwise  prohibiting  or  making  illegal  the  consummation  of  any  of  the
transactions contemplated by this Agreement.

                  5.2.4  Regulatory   Consents  and  Approvals.   All  consents,
approvals  and  actions of,  filings  with and  notices to any  Governmental  or
Regulatory  Authority  necessary to permit  Purchaser and the Sellers to perform
their  obligations  under this  Agreement  and to  consummate  the  transactions
contemplated hereby (i) shall have been duly obtained, made or given, (ii) shall
not be subject to the  satisfaction or any condition that has not been satisfied
or waived,  and (iii) shall be in full force and effect, and all terminations or
expirations  of  waiting  periods  imposed  by any  Governmental  or  Regulatory
Authority  necessary for the  consummation of the  transactions  contemplated by
this Agreement shall have occurred.

                  5.2.5 Officers'  Certificates.  Purchaser shall have delivered
to the  Sellers  a  certificate,  dated the  Closing  Date and  executed  by the
president or vice-president or other officer of Purchaser,  substantially in the
form and to the effect of Exhibit E hereto.

                                   ARTICLE VI

6        TERMINATION

         6.1 Termination Events. This Agreement may, by notice given prior to or
at the Closing, be terminated:

                  6.1.1 by Purchaser  or by the Sellers if a material  breach of
any provision of this  Agreement has been  committed by the other party and such
breach has not been waived;

                  6.1.2 (i) by Purchaser if any of the conditions in Section 5.1
has not been  satisfied  as of the  Closing  Date or if  satisfaction  of such a
condition is or becomes  impossible (other than through the failure of Purchaser
to comply with its  obligations  under this  Agreement)  and  Purchaser  has not
waived such condition on or before the Closing Date, or (ii) by the Sellers,  if
any of the  conditions  in Section 5.2 has not been  satisfied as of the Closing
Date or if satisfaction of such a condition is or becomes impossible (other than
through the failure of the  Sellers to comply  with his  obligations  under this
Agreement)  and the  Sellers  has not  waived  such  condition  on or before the
Closing Date;

                  6.1.3    by mutual consent of Purchaser and the Sellers; or

                  6.1.4 by  Purchaser  or by the  Sellers if the Closing has not
occurred  (other than through the failure of any party seeking to terminate this
Agreement  to comply  fully with its  obligations  under this  Agreement)  on or
before February 28, 1999, or such later date as the parties may agree upon.

         6.2 Effect of  Termination.  Each party's  right of  termination  under
Section 6.1 is in addition to any other rights it may have under this  Agreement
or otherwise, and the exercise of a right of termination will not be an election
of  remedies.  If this  Agreement  is  terminated  pursuant to Section  6.1, all
further  obligations of the parties under this Agreement will terminate,  except
that the  obligations in this Section and in Sections 9.3, 9.4, 9.13 and Article
X will survive;  provided,  however,  that if this  Agreement is terminated by a
party  because of a breach of the Agreement by the other party or because one or
more  of the  conditions  to the  terminating  party's  obligations  under  this
Agreement is not  satisfied as a result of the other  party's  failure to comply
with its  obligations  under this Agreement,  the  terminating  party's right to
pursue all legal remedies  (including  specific  performance)  will survive such
termination unimpaired.

                  6.2.1 If this  Agreement is  terminated,  and the  transaction
contemplated  herein is not  consummated,  Purchaser shall not employ any of the
employees  identified in Section  5.1.16  above,  or any of the employees of the
Company  who are  specifically  identified  to the  Purchaser  in writing by the
Company  within ten (10) days  following  cancellation  or  termination  of this
Agreement,  for a period of five (5) years following cancellation or termination
of this  Agreement.  The foregoing  shall  likewise  apply to all subsidiary and
related companies owned or controlled, directly or indirectly, by the Purchaser.

                                   ARTICLE VII

7        INDEMNIFICATION; TAX MATTERS

         7.1      Indemnification.

                  7.1.1 The Sellers will  indemnify  the Company,  the Purchaser
and their respective stockholders and the officers, directors, employees, agents
and  Affiliates  of each of them in respect  of, and hold each of them  harmless
from and against,  any and all Losses suffered,  incurred or sustained by any of
them or to which any of them becomes  subject,  resulting  from,  arising out of
relating to any  misrepresentation or breach of warranty or nonfulfillment of or
failure  to  perform  any  covenant  or  agreement  on the  part of the  Sellers
contained in this Agreement  (including,  without  limitation,  any  certificate
delivered in connection herewith or therewith).

                  7.1.2  Purchaser will indemnify the Sellers in respect of, and
hold him harmless  from and against,  any and all Losses  suffered,  incurred or
sustained by him or to which he becomes subject,  resulting from, arising out of
or relating to any  misrepresentation or breach of warranty or nonfulfillment of
or  failure  to perform  any  covenant  or  agreement  on the part of  Purchaser
contained in this Agreement  (including,  without  limitation,  any  certificate
delivered in connection herewith or therewith).

         7.2 Method of Asserting Claims.  All claims for  indemnification by any
Indemnified Party under Section 7.1 will be asserted and resolved as follows:

                  7.2.1 In order for an Indemnified  Party to be entitled to any
indemnification  provided for under Section 7.1 in respect of, arising out of or
involving  a claim or demand  made by any Person  not a party to this  Agreement
against the Indemnified  Party (a "Third Party Claim"),  the  Indemnified  Party
shall deliver a Claim Notice to the Indemnifying Party promptly after receipt by
such Indemnified  Party of written notice of the Third Party Claim;  _provided_,
that  failure to give such  Claim  Notice  shall not affect the  indemnification
provided  hereunder except to the extent the Indemnifying  Party shall have been
actually prejudiced as a result of such failure.

                  7.2.2 If a Third  Party Claim is made  against an  Indemnified
Party,  the  Indemnifying  Party shall be entitled to participate in the defense
thereof  and,  if it so  chooses,  to assume the defense  thereof  with  counsel
selected  by  the   Indemnifying   Party,   which  counsel  must  be  reasonably
satisfactory to the Indemnified Party. Should the Indemnifying Party so elect to
assume the defense of a Third Party Claim, the  Indemnifying  Party shall not be
liable to the Indemnified Party for legal expenses  subsequently incurred by the
Indemnified Party in connection with the defense thereof,  but shall continue to
pay for any expenses of investigation or any Loss suffered.  If the Indemnifying
Party  assumes  such  defense,  the  Indemnified  Party  shall have the right to
participate in the defense  thereof and to employ  counsel,  at its own expense,
separate  from  the  counsel  employed  by the  Indemnifying  Party.  If (i) the
Indemnifying  Party  shall not assume the  defense of a Third  Party  claim with
counsel  satisfactory to the Indemnified  Party within five Business Days of any
Claim  Notice,  or (ii) legal  counsel for the  Indemnified  Party  notifies the
Indemnifying  Party that  there are or may be legal  defenses  available  to the
Indemnifying  Party or to other Indemnified  Parties which are different from or
additional  to  those  available  to  the  Indemnified  Party,   which,  if  the
Indemnified Party and the Indemnifying  Party were to be represented by the same
counsel,  would  constitute a conflict of interest for such counsel or prejudice
prosecution of the defenses available to such Indemnified Party, or (iii) if the
Indemnifying  Party shall  assume the defense of a Third Party Claim and fail to
diligently prosecute such defense, then in each such case the Indemnified Party,
by notice to the Indemnifying  Party, may employ its own counsel and control the
defense of the Third Party Claim and the Indemnifying  Party shall be liable for
the  reasonable  fees,  charges  and  disbursements  of counsel  employed by the
Indemnified  Party, and the Indemnified  Party shall be promptly  reimbursed for
any such fees,  charges and  disbursements,  as and when  incurred.  Whether the
Indemnifying  Party or the  Indemnified  Party  control the defense of any Third
Party Claim,  the parties hereto shall  cooperate in the defense  thereof.  Such
cooperation  shall  include the  retention  and  provision to the counsel of the
controlling  party of records and information  which are reasonably  relevant to
such Third Party Claim, and making employees  available on a mutually convenient
basis to provide additional information and explanation or any material provided
hereunder. The Indemnifying Party shall have the right to settle,  compromise or
discharge a Third  Party  Claim  (other than any such Third Party Claim in which
criminal  conduct is alleged)  without the  Indemnified  Party's consent if such
settlement, compromise or discharge (i) constitutes a complete and unconditional
discharge and release of the Indemnified  Party, and (ii) provides for no relief
other than the payment of monetary damage and such monetary  damages are paid in
full by the Indemnifying Party.

                  7.2.3 In the event any  Indemnified  Party should have a claim
under Section 7.1 against any  Indemnifying  Party that does not involve a Third
Party Claim, the Indemnified Party shall promptly deliver an Indemnity Notice to
the  Indemnifying  Party.  The  failure  by any  Indemnified  Party  to give the
Indemnity  Notice shall not impair such party's rights  hereunder  except to the
extent  that an  Indemnifying  Party  demonstrates  that it has been  prejudiced
thereby.  If the Indemnifying  Party notifies the Indemnified Party that it does
not dispute the claim described in such Indemnity  Notice or fails to notify the
Indemnified  Party  within the Dispute  Period  whether the  Indemnifying  Party
disputes the claim  described in such Indemnity  Notice,  the Loss in the amount
specified in the Indemnity Notice will be conclusively deemed a liability of the
Indemnifying  Party under Section 7.1 and the  Indemnifying  Party shall pay the
amount of such Loss to the  Indemnified  Party on  demand.  If the  Indemnifying
Party has  timely  disputed  its  liability  with  respect  to such  claim,  the
Indemnifying  Party and the  Indemnified  Party  will  proceed  in good faith to
negotiate a resolution of such dispute, and if not resolved through negotiations
within thirty (30) days, such dispute shall be resolved as provided in Article X
hereof.

         7.3      Allocation of Tax Liability.

                  7.3.1 In the case of Taxes  with  respect to or payable by the
Company with  respect to a period that  includes but does not end on the Closing
Date,  the  allocation  of such Taxes  between  the  Pre-Closing  Period and the
Post-Closing  Period  shall be made on the basis of an  interim  closing  of the
books of the Company as of the close of business  on the  Closing  Date.  In the
case of (i)  franchise  Taxes based on  capitalization,  debt or shares of stock
authorized,  issued  or  outstanding  and (ii) _ad  valorem_  Taxes,  in  either
situation  attributable  to any taxable period that includes but does not end on
the Closing  Date,  the portion of such Taxes  attributable  to the  Pre-Closing
Period  shall  be the  amount  of such  Taxes  for the  entire  taxable  period,
multiplied  by a fraction  the  numerator of which is the number of days in such
taxable  period ending on and including the Closing Date and the  denominator of
which is the entire number of days in such taxable period;  _provided_,  that if
any Company  Asset is sold or otherwise  transferred  prior to the Closing Date,
then _ad valorem_ Taxes pertaining to such property,  asset or other right shall
be attributed entirely to the Pre-Closing Period.

                  7.3.2 Except to the extent a reserve for Taxes is reflected on
the Financial Statements, the Sellers shall be responsible for and pay and shall
indemnify  and hold  harmless  Purchaser and the Company with respect to (i) any
and all Taxes imposed on any of the Company,  or for which the Company is liable
with respect to any periods  ending on or before the Closing  Date;  _provided_,
that in the case of any  adjustment  to any item of loss or expense for any such
years, which gives rise to corresponding and offsetting items of loss or expense
in subsequent years the benefit of which is or will be actually  realized by the
Company (other than upon liquidation of the Company)  including by reason of any
increase in a net operating loss, the Sellers's  obligations shall be limited to
the  amount of  interest  (computed  at the  appropriate  statutory  rates)  and
penalties  actually paid to the appropriate taxing authorities by the Company as
a result of such timing  differences in the case of audit  adjustments,  or at a
rate of eight  percent  (8%) per  annum in the case of other  adjustments,  (ii)
without  duplication  (subject to the same proviso),  all Taxes arising out of a
breach of the  representations,  warranties or covenants contained herein, (iii)
any Tax liability  resulting  from any ongoing state audits that exceed,  in the
aggregate, any reserve therefore set forth on the Financial Statements, and (iv)
any reasonable out-of-pocket costs or expenses with respect to Taxes indemnified
hereunder.

                  7.3.3 From and after the Closing Date,  Purchaser  shall cause
the Company to prepare, or cause to be prepared,  and shall file, or cause to be
filed,  all reports and returns of the Company  required to be filed.  Purchaser
shall  cause the Company to pay the  appropriate  taxing  authorities  the Taxes
shown to be due and payable on all Tax  Returns of the  Company  filed after the
Closing Date, concurrent with the filing of such Tax Returns. Tax Returns of the
Company for a period ending on or before the Closing Date shall be prepared on a
basis  consistent with the Tax Returns filed by the Company for previous taxable
periods, subject to the requirements of applicable law.

         7.4      Tax Contests.

                  7.4.1 If any Taxing  Authority or other  Person  asserts a Tax
Claim,  then the party  hereto  first  receiving  notice of such Tax Claim shall
promptly provide written notice thereof to the other parties hereto. Such notice
shall  specify  in  reasonable  detail  the  basis  for such Tax Claim and shall
include a copy of any relevant correspondence received from the Taxing Authority
or other Person.

                  7.4.2  If,  within 30  calendar  days  after  any the  Sellers
receives or  delivers,  as the case may be,  notice of a Tax Claim,  the Sellers
provide to the Purchaser an Election  Notice,  then subject to the provisions of
this  Section 7.4, the Sellers  shall defend or  prosecute,  at their sole cost,
expense  and  risk,  such  Tax  Claim  by  all  appropriate  proceedings,  which
proceedings  shall  defended or prosecuted  diligently by the Sellers to a Final
Determination;  provided,  that the Sellers shall not, without the prior written
consent of the Company,  enter into any  compromise  or  settlement  of such Tax
Claim that would  result in any Tax  detriment  to the  Company.  So long as the
Sellers are defending or  prosecuting a Tax Claim,  with respect to the Company,
the Company shall provide or cause to be provided to the Sellers any information
reasonably  requested  by the  Sellers  relating  to such Tax  Claim,  and shall
otherwise cooperate with the Sellers and their  representatives in good faith in
order to  contest  effectively  such Tax Claim.  the  Sellers  shall  inform the
Company of all  developments  and events relating to such Tax Claim  (including,
without  limitation,  providing to the Company  copies of all written  materials
relating  to such Tax Claim) and the Company or its  authorized  representatives
shall  be  entitled,  at the  expense  of the  Company,  to  attend,  but not to
participate in or control, all conferences, meetings and proceedings relating to
such Tax Claim.

                  7.4.3 If, with respect to any Tax Claim,  the Sellers fails to
deliver an Election  Notice to the Company within the period provided in Section
7.4.2 or, after  delivery of such  Election  Notice to the Company,  the Sellers
fail diligently to defend or prosecute such Tax Claim to a Final  Determination,
then the  Company  shall  at any time  thereafter  have the  right  (but not the
obligation)  to defend or prosecute,  at the sole cost,  expense and risk of the
Sellers,  such Tax Claim. The Company shall have full control of such defense or
prosecution  and  such  proceedings,  including  any  settlement  or  compromise
thereof. If requested by the Company,  the Sellers shall cooperate in good faith
with  the  Company  and its  authorized  representatives  in  order  to  contest
effectively  such Tax Claim.  the Sellers may attend,  but not participate in or
control,  any defense,  prosecution,  settlement  or compromise of any Tax Claim
controlled by the Company  pursuant to this Section 7.4.3,  and shall bear their
own costs and expenses with respect  thereto.  In the case of any Tax Claim that
is defended or prosecuted  by the Company  pursuant to this Section  7.4.3,  the
Company shall,  from time to time, be entitled to receive current  payments from
the  Sellers  with  respect to costs and  expenses  incurred  by the  Company in
connection  with such defense or  prosecution  (including,  without  limitation,
reasonable  attorneys',   accountants'  and  experts'  fees  and  disbursements,
settlement costs, court costs and any other costs or expenses for investigating,
defending or prosecuting such Tax Claim, and any Taxes imposed on the Company as
a result of receiving a payment  from the Sellers  pursuant to this Section 7.4)
(collectively "Associated Costs").

                  7.4.4  In the  case  of any Tax  Claim  that  is  defended  or
prosecuted to a Final Determination by the Sellers pursuant to this Section 7.4,
the  Sellers  shall  pay to the  appropriate  Tax  Indemnitees,  in  immediately
available  funds,  the full amount of any Tax arising or resulting from such Tax
Claim within five Business Days after such Final  Determination.  In the case of
any Tax Claim that is defended or  prosecuted  to a Final  Determination  by the
Company  pursuant to the terms of this Section 7.4, the Sellers shall pay to the
appropriate Tax Indemnitee,  in immediately  available funds, the full amount of
any Tax arising or resulting  from such Tax Claim,  together with any Associated
Costs that have not theretofore been paid by the Sellers to the Company,  within
five Business Days after such Final Determination.  In the case of any Tax Claim
not  covered  by the two  preceding  sentences,  the  Sellers  shall  pay to the
Company,  in immediately  available funds, the full amount of any Tax arising or
resulting from such Tax Claim  (calculated  after taking into account any actual
reduction  in the current  liability  for Taxes of such Tax  Indemnitee  for Tax
arising out of or resulting from such payment or such Tax Claim),  together with
any Associated  Costs that have not theretofore  been paid by the Sellers to the
Company,  at least five Business Days before the date payment of such Tax is due
from any Tax Indemnitee.

                  7.4.5  Notwithstanding  anything contained in this Article VII
to the  contrary,  the rights of the Sellers under this Section 7.4 to defend or
prosecute,  or to control the defense or prosecution  of, any Tax Claim shall be
no greater than those rights that the Company would have to defend or prosecute,
or to control the defense or prosecution of, such Tax Claim.

         7.5  Cooperation  Regarding Tax Matters.  Each party hereto shall,  and
shall cause its  subsidiaries  and  Affiliates  to, provide to the other parties
hereto  and  the  Company  such  cooperation  and  information  as any  of  them
reasonably  may  request  related to the filing of any Tax  Return,  amended Tax
Return or claim for  refund,  determining  a  liability  for Taxes or a right to
refund of Taxes or in  conducting  any audit or other  proceeding  in respect of
Taxes.  Such cooperation and information  shall include  providing copies of all
relevant portions of relevant Tax Returns,  together with relevant  accompanying
schedules,  workpapers  and  relevant  documents  relating  to  rulings or other
determinations  by  Taxing  Authorities  and  relevant  records  concerning  the
ownership  and Tax basis of  property,  which any such party may  possess.  Each
party shall make its  employees  reasonably  available on a mutually  convenient
basis at its cost to provide  explanation  of any  documents or  information  so
provided.  Subject to the preceding  sentence,  each party  required to file Tax
Returns  pursuant  to this  Article  VII shall bear all costs of filing such Tax
Returns.

         7.6  Payment of  Transfer  Taxes and Fees.  the  Sellers  shall pay all
sales,  use,  transfer,  stamp,  documentary  or similar  Taxes  imposed upon or
arising out of or in connection with the transactions  effected pursuant to this
Agreement,  and shall indemnify,  defend,  and hold harmless the Purchaser,  the
Company and their  Affiliates with respect to such Taxes. the Sellers shall file
all  necessary  documentation  and Tax  Returns  with  respect to such Taxes and
provide to Purchaser copies of all such Tax Returns.

         7.7      Other Tax Covenants.

                  7.7.1 Without the prior written consent of Purchaser,  neither
the Sellers nor any  Affiliate  of any the Sellers  shall,  to the extent it may
affect or relate to the  Company,  make or change any tax  election,  change any
annual tax accounting period, adopt or change any method of tax accounting, file
any amended Tax Return, enter into any method of tax accounting,  enter into any
closing  agreement,  settle any Tax Claim,  assessment  or proposed  assessment,
surrender any right to claim a Tax refund, consent to any extension or waiver of
the limitation  period applicable to any Tax Claim or assessment or take or omit
to take any other action,  if any such action or omission  would have the effect
of increasing any post-closing Tax Liability of the Purchaser, of the Company or
any Affiliate of Purchaser.

                  7.7.2  Without  the  prior  written  consent  of the  Sellers,
neither  the  Purchaser  nor the Company  shall,  to the extent it may affect or
relate to the  Company,  make or change any tax  election,  file any amended Tax
Return,  enter into any closing Agreement,  settle any Tax claim,  assessment or
proposed assessment,  surrender any right to claim a Tax refund,  consent to any
extension  or waiver of the  limitation  period  applicable  to any Tax claim or
assessment  or take or omit to take any  other  action,  if any such  action  or
omission would affect a Pre-Closing  Tax Period,  unless  required by applicable
law.

                  7.7.3 So long as any books,  records and files retained by the
Sellers or and his  Affiliates  relating  to the  business of the Company or the
books,  records and files delivered to the control of the Purchaser  pursuant to
this  Agreement to the extent they relate to the operations of the Company prior
to the Closing Date,  remain in existence and are available,  each party (at its
own  expense)  shall  have the right upon  prior  notice to inspect  and to make
copies of the same at any time during business hours for any proper purpose. The
Purchaser and the Sellers and their  respective  Affiliates shall use reasonable
efforts not to destroy or allow the  destruction of any such books,  records and
files without first providing 60 days' written notice of intention to destroy to
the other, and allowing such other party to take possession of such records.

         7.8  Conflict.  In the event of a conflict  between the  provisions  of
Sections  7.3 through 7.7 of this  Article VII and any other  provision  of this
Agreement, such provisions of this Article VII shall control.

                                  ARTICLE VIII

8        DEFINITIONS

         8.1 Definitions. As used in this Agreement, the following defined terms
shall have the meanings indicated below:

                  "Actions or Proceedings" means any action,  suit,  proceeding,
arbitration or Governmental or Regulatory Authority investigation or audit.

                  "Affiliate"  means,  as applied to any  Person,  (a) any other
Person directly or indirectly owning,  owned by,  controlling,  controlled by or
under common  control with,  that Person,  (b) any director,  partner,  officer,
agent, employee or relative of such Person. For the purposes of this definition,
"control"  (including  with  correlative  meanings,   the  terms  "controlling",
"controlled  by",  and "under  common  control  with") as applied to any Person,
means the  possession,  directly or indirectly,  of the power to direct or cause
the direction of the management and policies of that Person.

                  "Agreement"  means this Purchase  Agreement,  the Exhibits and
the Disclosure Schedule and the certificates  delivered in connection  herewith,
as the  same may be  amended  from  time to time in  accordance  with the  terms
hereof.

                  "Assets"  of any Person  means all assets  and  properties  of
every kind,  nature,  character and  description,  including  goodwill and other
tangibles,  operated,  owned or leased by such Person,  including  cash and cash
equivalents,   investments,   accounts  and  notes  receivable,  chattel  paper,
documents,   instruments,   real  estate,   equipment,   inventory,   goods  and
intellectual property.

                  "Associated  Costs" has the meaning  ascribed to it in Section
7.4.3.

                  "Benefit Plan" means any Plan, existing at the Closing Date or
prior thereto,  established or to which contributions have at any time been made
by the Company or under which any employee,  former  employee or director of the
Company or any beneficiary  thereof is covered,  is eligible for coverage or has
benefit rights.

                  "Books and Records" means all files,  documents,  instruments,
papers,  books  and  records  relating  to  the  Company,   including  financial
statements,  Tax Returns and related work papers and letters  from  accountants,
budgets, pricing guidelines,  ledgers,  journals,  deeds, title policies, minute
books,  stock  certificates  and  books,  stock  transfer  ledgers,   Contracts,
Licenses,  customer  lists,  computer  files and programs,  retrieval  programs,
operating data and plans and environmental studies and plans.

                  "Claim Notice" means written notification  pursuant to Section
7.2.1 of a Third Party Claim as to which  indemnity  under Section 7.1 is sought
by an Indemnified Party.

                  "Closing" and "Closing Date" have the meaning ascribed to them
in Section 1.3.

                  "Code"  means the Internal  Revenue Code of 1986,  as amended,
and the rules and regulations promulgated thereunder.

                  "Company" has the meaning  ascribed to it in the first recital
of this Agreement (and shall include all  predecessors  and  subsidiaries of the
Company).

                  "Contract"   means   any   agreement,   lease,   evidence   of
indebtedness, mortgage, indenture, security agreement or other contract (whether
written or oral).

                  "Disclosure   Schedule"  means  the  schedules   delivered  to
Purchaser  by or on behalf of the Company  and the  Sellers,  and the  schedules
delivered  by or on behalf of  Purchaser,  containing  all lists,  descriptions,
exceptions  and other  information  and materials as are required to be included
therein pursuant to this Agreement.

                  "Dispute  Period" means the period ending thirty (30) calendar
days following  receipt by an Indemnifying  Party of either a Claim Notice or an
Indemnity Notice.

                  "Election  Notice"  means a  written  notice  provided  by the
Sellers in respect of a Tax Claim to the effect that (i) the Sellers acknowledge
their indemnity  obligation  under this Agreement with respect to such Tax Claim
and (ii) the Sellers elect to contest, and to control the defense or prosecution
of, such Tax Claim at their sole risk and sole cost and expense.

                  "Environment"  means  all  air,  surface  water,  groundwater,
drinking water supply,  stream sediments,  or land, including soil, land surface
or subsurface  strata,  all fish,  wildlife,  biota and all other  environmental
medium or natural resources.

                  "Environmental, Health and Safety Liabilities" means any cost,
damages, expense, liability, obligation, or other responsibility arising from or
under any Environmental Law or Occupational Safety and Health Law and consisting
of or relating to (i) any environmental,  health or safety matters or conditions
(including on-site or off-site  contamination,  occupational  safety and health,
and  regulation  of chemical  substances or  products);  (ii) fines,  penalties,
judgments,  awards, settlements,  legal or administrative proceedings,  damages,
losses,  claims,  demands and response,  investigative,  remedial, or inspection
costs and expenses arising under  Environmental  Law or Occupational  Safety and
Health  Law;  (iii)  financial   responsibility   under   Environmental  Law  or
Occupational  Safety and Health Law for  clean-up  costs or  corrective  action,
including  any  investigation,   clean-up,   removal,   containment,   or  other
remediation or response actions  required by  Environmental  Law or Occupational
Safety  and  Health Law  (whether  or not such  clean-up  has been  required  or
requested  by any  governmental  body or any other  Person)  and for any natural
resource damages; or (iv) any other compliance,  corrective,  investigative,  or
remedial  measures required under  Environmental Law or Occupational  Safety and
Health Law. The terms "removal,"  "remedial," and "response  action" include the
types of  activities  covered by the United States  Comprehensive  Environmental
Response,  Compensation,  and Liability Act, 42 U.S.C.  Section 9601 et seq., as
amended (CERCLA).

                  "Environmental  Law"  means  all  federal,  state,  local  and
foreign  environmental,  health and safety  laws,  common law  orders,  decrees,
judgments,  codes  and  ordinances  and all rules  and  regulations  promulgated
thereunder,  civil or criminal,  including, without limitation, Laws relating to
emissions,  discharges,  releases or threatened releases of Hazardous Materials,
pollutants,   contaminants,   chemicals,  or  industrial,   toxic  or  hazardous
substances  or  wastes  into  the  Environment  or  otherwise  relating  to  the
manufacture,   processing,  distribution,  use,  treatment,  storage,  disposal,
transport  or  handling  of  Hazardous  Materials,   pollutants,   contaminants,
chemicals, or industrial, solid, toxic or hazardous substances or wastes.

                  "Environmental  Permit"  means  any  federal,   state,  local,
provincial, or foreign permits, licenses,  approvals,  consent or authorizations
required by any Governmental or Regulatory Authority under or in connection with
any Environmental Law and includes any and all orders, consent orders or binding
agreements  issued or entered into by a  Governmental  or  Regulatory  Authority
under any applicable Environmental Law.

                  "ERISA" means the Employee  Retirement  Income Security Act of
1974, as amended, and the rules and regulations promulgated thereunder.

                  "Facilities"  means any real  property,  leaseholds,  or other
interests  currently  or  formerly  owned or  operated  by the  Company  and any
buildings,  plants, structures or equipment (including motor vehicles, tank cars
and rolling stock) currently or formerly owned or operated by the Company.

                  "Final Determination" means (i) a decision,  judgment,  decree
or other Order by any court of competent jurisdiction, which decision, judgment,
decree or other  Order has become  final after all  allowable  appeals by either
party to the action have been  exhausted or the time for filing such appeals has
expired, (ii) a closing agreement entered into under Section 7121 of the Code or
any other settlement agreement entered into in connection with an administrative
or judicial  proceeding,  (iii) the expiration of the time for instituting  suit
with  respect to a claimed  deficiency  or (iv) the  expiration  of the time for
instituting a claim for refund,  or if such a claim was filed, the expiration of
the time for instituting suit with respect thereto.

                  "Financial  Statements"  has  the  meaning  ascribed  to it in
Section 2.8.

                  "GAAP" means generally accepted  accounting  principles of the
United States, consistently applied.

                  "Governmental  or  Regulatory   Authority"  means  any  court,
tribunal,   arbitrator,   authority,  agency,  commission,   official  or  other
instrumentality  of the United  States,  any foreign  country or any domestic or
foreign state, county, city or other political subdivision.

                  "Hazardous  Activity"  means  the  distribution,   generation,
handling,  importing,   management,   manufacturing,   processing,   production,
refinement,  Release,  storage,  transfer,  transportation,  treatment,  or  use
(including any withdrawal or other use of  groundwater)  of Hazardous  Materials
in, on,  under,  about,  or from the  Facilities  or any part  thereof  into the
Environment, and any other act, business, operation, or thing that increases the
danger,  or risk of danger,  or poses an unreasonable risk of harm to persons or
property  on or off  the  Facilities,  or  that  may  affect  the  value  of the
Facilities or the Company.

                  "Hazardous  Material"  means (i) any  petroleum  or  petroleum
products,  radioactive  materials,  asbestos in any form that is or could become
friable,  urea  formaldehyde foam insulation and transformers or other equipment
that contain  dielectric fluid containing  levels of  polychlorinated  biphenyls
(PCBs);  (ii) any  chemicals,  materials,  substances or wastes which are now or
hereafter  become  defined  as or  included  in  the  definition  of  "hazardous
substances,"  "hazardous wastes," "hazardous  materials,"  "extremely  hazardous
wastes,"  "restricted  hazardous wastes," "toxic substances," "toxic pollutants"
or words of similar  import,  under any  Environmental  Law; and (iii) any other
chemical,  material,  substance or waste,  exposure to which is now or hereafter
prohibited, limited or regulated by any Governmental or Regulatory Authority.

                  "Indebtedness"  of any Person  means all  obligations  of such
Person (i) for borrowed  money,  (ii) evidenced by notes,  bonds,  debentures or
similar instruments,  (iii) for the deferred purchase price of goods or services
(other  than trade  payables  or accruals  incurred  in the  ordinary  course of
business),  (iv) under capital leases, (v) long term debt and (vi) in the nature
of guarantees of the  obligations  described in clauses (i) through (v) above of
any other Person.

                  "Indemnified Party" means any Person claiming  indemnification
under any provision of Article VII.

                  "Indemnifying Party" means any Person against whom a claim for
indemnification is being asserted under any provision of Article VII.

                  "Indemnity  Notice"  means  written  notification  pursuant to
Section  7.2.3 of a claim for  indemnity  under  Article  VII by an  Indemnified
Party,  specifying  the nature of and basis for such  claim,  together  with the
amount  or,  if  not  then  reasonably  ascertainable,   the  estimated  amount,
determined in good faith, of such claim.

                  "Laws"   means  all  laws,   statutes,   rules,   regulations,
ordinances  and other  pronouncements  having  the  effect of law of the  United
States,  any foreign country or any domestic or foreign state,  county,  city or
other political subdivision or of any Governmental or Regulatory Authority.

                  "Leased  Real  Property"  has the  meaning  ascribed  to it in
Section 2.15.

                  "Liabilities"  means all  Indebtedness,  obligations and other
liabilities (or contingencies that have not yet become  liabilities) of a Person
(whether absolute, accrued, contingent (or based upon any contingency), known or
unknown, fixed or otherwise, or whether due or to become due).

                  "Licenses"  means  all  licenses,  permits,   certificates  of
authority,  authorizations,  approvals,  registrations,  franchises  and similar
consents granted or issued by any Governmental or Regulatory Authority.

                  "Liens"  means  any  mortgage,  pledge,  assessment,  security
interest,  lease,  lien, adverse claim, levy, charge or other encumbrance of any
kind,  or any  conditional  sale  Contract,  title  retention  Contract or other
Contract to give any of the foregoing.

                  "Loss"  means any and all  damages,  fines,  fees,  penalties,
deficiencies,  diminution in value of investment, losses and expenses, including
without limitation, interest, reasonable expenses of investigation, court costs,
reasonable  fees and expenses of  attorneys,  accountants  and other  experts or
other expenses of litigation or other  proceedings  or of any claim,  default or
assessment  (such fees and  expenses to include all fees and  expenses,  such as
fees  and  expenses  of  attorneys,   incurred  in   connection   with  (i)  the
investigation  or  defense  of any  Third  Party  Claims  or (ii)  asserting  or
disputing  any  rights  under  this  Agreement   against  any  party  hereto  or
otherwise).

                  "Occupational Safety and Health Law" means any Law designed to
provide safe and healthful working conditions and to reduce  occupational safety
and health hazards, and any program,  whether governmental or private (including
those   promulgated  or  sponsored  by  industry   associations   and  insurance
companies), designed to provide safe and healthful working conditions.

                  "Option" with respect to any Person means any security, right,
subscription,  warrant,  option,  "phantom"  stock right or other  Contract that
gives the right to (i) purchase or otherwise  receive or be issued any shares of
capital  stock or other  equity  interests of such Person or any security of any
kind  convertible  into or exchangeable or exercisable for any shares of capital
stock or other equity interests of such Person,  or (ii) receive any benefits or
rights  similar  to those  enjoyed  by or  accruing  to the  holder of shares of
capital  stock or other  equity  interests  of such  Person,  including  without
limitation,  any rights to  participate  in the  equity,  income or  election of
directors or officers of such Person.

                  "Order"  means  any  writ,  judgment,  decree,  injunction  or
similar order of any  Governmental  or  Regulatory  Authority (in each such case
whether preliminary or final).

                  "Owned  Real  Property"  has  the  meaning  ascribed  to it in
Section 2.15.

                  "Person"  means  any  natural  person,  corporation,   general
partnership,  limited  partnership,  limited  liability  company or partnership,
proprietorship,  other  business  organization,  trust,  union,  association  or
Governmental or Regulatory Authority.

                  "Plan" means any bonus, compensation, pension, profit sharing,
retirement,  stock purchase or cafeteria,  life, health,  accident,  disability,
workmen's  compensation  or  other  insurance,  severance,  separation  or other
employee  benefit plan,  practice,  policy or arrangement  of any kind,  whether
written or oral, or whether for the benefit of a single  individual or more than
one individual including, but not limited to, any "employee benefit plan" within
the meaning of Section 3(3) of ERISA.

                  "Post-Closing  Period"  means any  taxable  period or  portion
thereof  beginning  after the Closing  Date.  If a taxable  period  begins on or
before the Closing Date and ends after the Closing Date, then the portion of the
taxable  period  that  begins  on the  day  following  the  Closing  Date  shall
constitute a Post-Closing Period.

                  "Pre-Closing  Period"  means any  taxable  period  or  portion
thereof that is not a Post-Closing Period.

                  "Purchase  Price" has the  meaning  ascribed  to it in Section
1.2.

                  "Purchased  Stock" has the meaning ascribed to it on the first
page of this Agreement.

                  "Purchaser"  has  the  meaning  ascribed  to it in  the  first
paragraph of this Agreement.

                  "Real  Property"  has the  meaning  ascribed  to it in Section
2.15.

                  "Real  Property  Leases"  has the  meaning  ascribed  to it in
Section 2.15.

                  "Release"  means  any  spilling,  leaking,  pumping,  pouring,
emitting,  emptying,  discharging,  injecting,  escaping,  leaching, dumping, or
disposing of a Hazardous Material into the Environment.

                  "Securities Act" means the Securities Act of 1933, as amended,
and the rules and regulations thereunder.

                  "Seller" and the "Sellers"  have the meaning  ascribed to them
on the first page of this Agreement.

                  "Subsidiary"   means  any  Person  in  which  another  Person,
directly or indirectly through  Subsidiaries or otherwise,  beneficially owns at
least  fifty  percent  (50%) of either  the  equity  interest  in, or the voting
control of, such Person,  whether or not existing on the date hereof. Unless the
context  otherwise  requires  a  different   interpretation,   references  to  a
"Subsidiary" mean a Subsidiary of the Company.

                  "Tax" or "Taxes"  means all federal,  state,  local or foreign
net or gross income, gross receipts, net proceeds, sales, use, ad valorem, value
added,  franchise,   withholding,   payroll,   employment,   excise,   property,
alternative  or  add-on  minimum,  environmental  or other  taxes,  assessments,
duties,  fees,  levies or other  governmental  charges of any  nature  whatever,
whether disputed or not, together with any interest, penalties, additions to tax
or additional amounts with respect thereto.

                  "Tax  Claim"  means any  written  claim with  respect to Taxes
attributable to a Pre-Closing  Period made by any Taxing Authority or any Person
that,  if  pursued  successfully,  could  serve  as the  basis  for a claim  for
indemnification,  under this  Agreement,  of  Purchaser,  the  Company and other
Indemnified Parties specified in Section 7.1 of this Agreement.

                  "Tax  Indemnitee"  means the Company,  the Purchaser and their
respective stockholders,  officers, directors,  employees, agents and Affiliates
of each of them (other than the Sellers).

                  "Tax  Returns"  means  any  returns,   reports  or  statements
(including  any  information  returns)  required  to be filed for  purposes of a
particular Tax.

                  "Taxing  Authority"  means  any  governmental  agency,  board,
bureau,  body,  department or authority of any United States  federal,  state or
local jurisdiction or any foreign jurisdiction, having or purporting to exercise
jurisdiction with respect to any Tax.

                  "Third Party Claim" has the meaning  ascribed to it in Section
7.2.

         8.2      Interpretation of Agreement.

                  8.2.1 Unless the context of this Agreement otherwise requires,
(i) words of any gender include each other gender; (ii) words using the singular
or plural number also include the plural or singular number, respectively; (iii)
the terms "hereof,"  "herein," "hereby" and derivative or similar words refer to
this  entire  Agreement;  (iv) the terms  "Article"  or  "Section"  refer to the
specified  Article or Section of this Agreement;  (v) the word  "including" does
not imply any limitation to the item or matter  mentioned;  and (vi) the phrases
"ordinary course of business" and "ordinary  course of business  consistent with
past practice" refer to the business and practice of the Company. All accounting
terms used herein and not expressly defined herein shall have the meanings given
to them under GAAP.

                  8.2.2 When used herein,  the phrase "to the  knowledge of" any
Person,  "to the best knowledge of" any Person or any similar phrase,  means (i)
with respect to any Person who is an  individual,  the actual  knowledge of such
Person,  (ii) with  respect to any other  Person,  the actual  knowledge  of the
directors,  officers,  managers, and other similar Persons in a similar position
or having  similar  powers and duties,  and (iii) in the case of each of (i) and
(ii), the knowledge of facts that such individuals  should have after reasonable
inquiry.

                                   ARTICLE IX

9        MISCELLANEOUS

         9.1 Notices. All notices,  requests and other communications  hereunder
must be in writing and will be deemed to have been duly given only if  delivered
personally  or mailed by prepaid  first class  certified  mail,  return  receipt
requested,  or  sent  by  prepaid  courier,  to the  parties  at  the  following
addresses:

If to Purchaser, to:

ISG Resources, Inc.
136 East South Temple, Suite 1300
Salt Lake City, UT 84111
Attn.:  Sr. Vice President and General Counsel

If to the Sellers, to:

Mr. William ___. Leslie
_________________
_________________
_________________

All such  notices,  requests  and  other  communications  will (i) if  delivered
personally  to the  address as provided in this  Section,  be deemed  given upon
delivery, (ii) if delivered by mail in the manner described above to the address
as provided in this Section,  be deemed given upon receipt and (iv) if delivered
by courier to the address as provided  for in this  Section,  be deemed given on
the earlier of the second  Business Day  following the date sent by such courier
or upon  receipt.  Any party from time to time may  change its  address or other
information for the purpose of notices to that party by giving notice specifying
such change to the other party hereto.

         9.2 Entire Agreement.  This Agreement  supersedes all prior discussions
and agreements between the parties with respect to the subject matter hereof and
thereof and contains the sole and entire  agreement  between the parties  hereto
with respect to the subject matter hereof and thereof.

         9.3 Expenses.  Except as otherwise expressly provided in this Agreement
(including  without  limitation as provided in Article VII), each party will pay
its own costs and expenses  incurred in connection with this Agreement,  and the
transactions contemplated hereby and thereby;  _provided_,  the Sellers will pay
all expenses  relating  hereto of the Company  incurred in respect of the period
prior to the Closing.

         9.4  Confidentiality.  Purchaser  and the  Sellers  will hold in strict
confidence  from any Person (other than its Affiliates or  representatives)  all
documents  and  information  concerning  the  other  party  hereto or any of its
Affiliates furnished to it by or on behalf of the other party in connection with
this Agreement or the transactions contemplated hereby, except to the extent the
disclosing  party can  demonstrate  that such documents or  information  was (a)
previously  known by the party receiving such documents or  information,  (b) in
the public domain  (either prior to or after the furnishing of such documents or
information  hereunder)  through no fault of such  receiving  party or (c) later
acquired by the receiving  party from another  source if the receiving  party is
not aware that such source is under an  obligation  to another  party  hereto to
keep  such   documents   and   information   confidential.   Such   covenant  of
confidentiality will remain in effect unless a party is compelled to disclose by
judicial or administrative  process  (including in connection with obtaining the
necessary  approvals of this Agreement and the transactions  contemplated hereby
of Governmental or Regulatory Authorities) or by other requirements of Law.

         9.5  Set-Off.  If from time to time and at any time any party  shall be
entitled (as either agreed upon by the parties or finally adjudicated in a court
of competent jurisdiction) to be paid any amount under the provisions of Section
7.1,  such party  shall be  entitled,  if it so elects,  to set off such  amount
against any amounts owing to the other party.

         9.6 Further Assurances;  Post-Closing Cooperation.  At any time or from
time to time  after the  Closing,  the  Sellers  shall  execute  and  deliver to
Purchaser  such other  documents  and  instruments,  provide such  materials and
information  and take such other actions as Purchaser may reasonably  request to
consummate  the  transactions  contemplated  by this  Agreement and otherwise to
cause each the  Sellers to fulfill its  obligations  under this  Agreement.  The
Sellers shall also,  for a reasonable  period of time (not to exceed ninety (90)
days),  cooperate  with  Purchaser by continuing to provide any welfare  benefit
plan, payroll services plan, operational service, or other service of any nature
being  provided  to the  Company by the Sellers or any  business  entity  owned,
managed or controlled, in any manner, by the Sellers. All of such services shall
be provided at cost, plus ten percent (10%).

         9.7 Waiver.  Any term or condition of this  Agreement  may be waived at
any time by the party  that is  entitled  to the  benefit  thereof,  but no such
waiver shall be effective unless set forth in a written instrument duly executed
by or on behalf of the party  waiving such term or  condition.  No waiver by any
party of any term or condition of this Agreement,  in any one or more instances,
shall be deemed to be or  construed as a waiver of the same or any other term or
condition of this Agreement on any future occasion.  All remedies,  either under
this  Agreement  or by Law or otherwise  afforded,  will be  cumulative  and not
alternative.

         9.8 Amendment. This Agreement may be amended,  supplemented or modified
only by a written  instrument  duly  executed  by or on  behalf  of the  parties
hereto.

         9.9 No Third  Party  Beneficiary.  The  terms  and  provisions  of this
Agreement  are  intended  solely for the benefit of each party  hereto and their
respective  successors or permitted assigns,  and it is not the intention of the
parties to confer  third-party  beneficiary  rights, and this Agreement does not
confer any such rights,  upon any other Person other than any Person entitled to
indemnity under Article VII.

         9.10 No  Assignment;  Binding  Effect.  Neither this  Agreement nor any
right,  interest or obligation hereunder may be assigned (by operation of law or
otherwise)  by either  party  without  the prior  written  consent  of the other
party(ies)  and any  attempt  to do so will be void.  Subject  to the  preceding
sentence,  this  Agreement  is  binding  upon,  inures to the  benefit of and is
enforceable by the parties hereto and their respective successors and assigns.

         9.11  Headings.  The headings used in this Agreement have been inserted
for  convenience  of  reference  only and do not define or limit the  provisions
hereof.

         9.12 Invalid Provisions.  If any provision of this Agreement is held to
be illegal, invalid or unenforceable under any present or future Law, and if the
rights or  obligations  of any party  hereto  under this  Agreement  will not be
materially  and adversely  affected  thereby,  (a) such  provision will be fully
severable, (b) this Agreement will be construed and enforced as if such illegal,
invalid or  unenforceable  provision had never comprised a part hereof,  (c) the
remaining  provisions of this Agreement will remain in full force and effect and
will not be affected by the illegal,  invalid or  unenforceable  provision or by
its severance herefrom and (d) in lieu of such illegal, invalid or unenforceable
provision,  there  will be added  automatically  as a part of this  Agreement  a
legal,  valid and  enforceable  provision  as similar in terms to such  illegal,
invalid or unenforceable provision as may be possible.

         9.13 Governing  Law. This Agreement  shall be governed by and construed
in  accordance  with the domestic laws of the State of Montana,  without  giving
effect to any  choice of law or  conflict  of law  provision  or rule that would
cause the  application of the laws of any  jurisdiction  other than the State of
Montana.

         9.14 Limited Recourse.  Regardless of anything in this Agreement to the
contrary,  (i)  obligations  and  liabilities  of Purchaser  hereunder  shall be
without  recourse to any  stockholder of Purchaser or any of such  stockholder's
Affiliates, directors, employees, officers or agents and shall be limited to the
assets of such party and (ii) the  stockholders  of Purchaser  have made no (and
shall not be deemed to have made any)  representations,  warranties or covenants
(express or implied)  under or in  connection  with this  Agreement or any other
Operative Agreement.

         9.15  Counterparts.  This  Agreement  may be  executed in any number of
counterparts,  each of  which  will be  deemed  an  original,  but all of  which
together will constitute one and the same instrument.

                                    ARTICLE X

10       MEDIATION

         In the event there is a dispute under this  Agreement,  the disagreeing
parties  shall meet with one another  and  diligently  attempt to resolve  their
disagreements. If they are unable to do so, then upon request of either party to
the dispute made within  twenty (20) days of the failure of  negotiations,  they
will mediate the dispute,  utilizing an impartial mediator pursuant to the rules
of  the  American  Arbitration   Association  ("AAA")  or  any  other  reputable
organization that sponsors  mediation.  If, after thirty (30) days the mediation
is not  successful,  or if no mediation has been elected,  then any party to the
dispute  may file a legal  action  in any  court of  competent  jurisdiction  to
resolve the dispute.

         IN WITNESS WHEREOF,  the parties have executed this Agreement as of the
date set forth on the first page hereof.

                                                             PURCHASER

                                                             ISG RESOURCES, INC.

                                                              _______________
                                                              By: ___________
                                                              Its: __________

                                                              SELLERS

                                                              WILLIAM __. LESLIE

                                                              ________________
                                                              William __. Leslie

<PAGE>

                                    EXHIBIT B

                              Officer's Certificate

         I, the  undersigned,  the President of Mineral  Specialties,  Inc. (the
"Company"), a Montana corporation, do hereby certify that:

1. This  Certificate is being delivered at the Closing today pursuant to Section
__ of the Stock Purchase Agreement (the "Agreement") dated May __, 1999, between
ISG Resources, Inc., a Utah corporation  ("Purchaser"),  and William __. Leslie,
an  individual  residing in the state of  Montana.  Unless  otherwise  indicated
herein,  capitalized terms used in this Certificate shall have the same meanings
given to them in the Agreement.

2.  Attached  hereto as  Exhibit  __-1 is a  correct  and  complete  copy of the
Certificate of Incorporation of the Company, as in effect on the date hereof.

3. Attached hereto as Exhibit __-2 is a correct and complete copy of the By-Laws
of the Company, as in effect on the date hereof.

4.  Attached  hereto  Exhibit  __-3  is a  correct  and  complete  copy  of  the
Certificates of Good Standing of the Company, as in effect on the date hereof.

5.  Attached  hereto  Exhibit __-4 is a correct and complete list of the persons
that have been duly elected (or appointed), qualified and acting as officers and
directors of the Company (to and including  the date  hereof),  each holding the
respective  offices set forth opposite their names; and the signatures set forth
opposite their names on Exhibit -4 are the genuine signatures of such persons.

         IN WITNESS WHEREOF,  the undersigned has duly executed this Certificate
as of the date hereof.

                                            ____________________
                                            By:_________________
                                            President, Mineral Specialties, Inc.

<PAGE>

                                    EXHIBIT C

                      Chief Financial Officer's Certificate

         I, the undersigned, the Chief Financial Officer of Mineral Specialties,
Inc. (the "Company"), a Montana corporation, do hereby certify that:

1. This  Certificate is being delivered at the Closing today pursuant to Section
__ of the Stock Purchase Agreement (the "Agreement") dated May __, 1999, between
ISG Resources, Inc., a Utah corporation  ("Purchaser"),  and William __. Leslie,
an  individual  residing in the state of  Montana.  Unless  otherwise  indicated
herein,  capitalized terms used in this Certificate shall have the same meanings
given to them in the Agreement.

2. I am familiar with the Company's finances and capitalization.

3. The Company has provided  the  Purchaser  with the  Financial  Statements  as
provided in the Agreement.

4. The Financial Statements accurately present the Company's financial condition
and  operations  as of and through  the  respective  dates and  periods  therein
delineated, and the results of the Company's operations and changes in financial
position for the periods then ended,  and have been prepared in accordance  with
GAAP, applied on a consistent basis.

5. As of the Closing Date, no material adverse change in the financial condition
or operations of the Company will have occurred from that shown on the Financial
Statements.

6. The  Company's  authorized  capital  stock  consists  of ___ shares of common
stock, all of which are outstanding and owned by the Seller.

7.  There  are  no  outstanding   options,   warrants,   calls,   subscriptions,
commitments, agreements or other rights to purchase or dispose of Company common
stock or other  securities  which are, or may at any time be,  convertible  into
stock or other securities in the Company.

         IN WITNESS WHEREOF,  the undersigned has duly executed this Certificate
as of the date hereof.

                                       _____________________
                                    By:_____________________
                                    CFO, Mineral Specialties, Inc.

<PAGE>

                                    EXHIBIT D

                               Opinion of Counsel

                             On Counsel's Letterhead

ISG Resources, Inc.
136 East South Temple, Suite 1300
Salt Lake City, Utah  84111

Dear Sirs:

         I have acted as counsel to  _______________  (herein  collectively  the
"Sellers") and Mineral Specialties, Inc., a Montana corporation (the "Company"),
in  connection  with  the  Stock  Purchase  Agreement  dated  May  ,  1999  (the
"Agreement") between ISG Resources, Inc., a Utah corporation ("Purchaser"),  and
the Sellers.  This is the opinion contemplated by section ____ of the Agreement.
All  capitalized  terms  used  in  this  opinion  without  definition  have  the
respective  meanings  give to them in the  Agreement  or the Accord  referred to
below.

         This  Opinion  Letter  is  governed  by,  and shall be  interpreted  in
accordance  with,  the Legal Opinion Accord (the "Accord") of the ABA Section of
Business  Law  (1991).  As  a  consequence,   it  is  subject  to  a  number  of
qualifications,  exceptions,  definitions,  limitations  on  coverage  and other
limitations,  all as more particularly described in the Accord, and this Opinion
Letter should be read in conjunction therewith.  The General qualifications,  as
defined in the Accord,  apply to all of the  opinions  set forth in this Opinion
Letter.

         Based on the foregoing, our opinion is as follows:

         1. The Agreement is enforceable against the Sellers.

         2. The authorized  capital stock of the company  consists of ___ shares
of  common  stock,  all  of  which  are  outstanding.  Sellers  own  all  of the
outstanding stock of record free and clear of all adverse claims. As a result of
the delivery of  certificates to Purchaser and the payment to Sellers being made
at the Closing, Purchaser is acquiring ownership of all of the outstanding stock
of the company, free and clear of all adverse claims.

         3. The Company is a corporation duly organized, validly existing and in
good standing under the laws of Montana, with full corporate power and authority
to own its properties and to engage in their business as presently  conducted or
contemplated. All of the outstanding shares of capital stock of the Company have
been authorized and validly issued and are paid and  nonassessable  and were not
issued in violation of the preemptive rights or any person.

         4.  Neither  the  execution  and  delivery  of the  Agreement  nor  the
consummation of any or all of the transactions contemplated by the Agreement (a)
breaches or  constitutes  a default  (or an event that,  with notice or lapse of
time or both,  would  constitute a default) under any agreement or commitment to
which the Sellers are parties or (b) violates any statute,  law,  regulation  or
rule, or any judgement, decree or order of any court applicable to the Sellers.

         5.  Neither  the  execution  and  delivery  of the  Agreement  nor  the
consummation of any or all of the transactions contemplated by the agreement (a)
violates any  provision of the  certificate  of  incorporation  or bylaws of the
company,  (b) breaches or constitutes a default (or any event that,  with notice
or lapse of time or both,  would  constitute a default) under, or results in the
termination  of,  or  accelerates  the  performance   required  by,  or  excuses
performance  by any  person  of any of its  obligations  under,  or  causes  the
acceleration  of the maturity of any debt or obligation  pursuant to, or results
in the creation or imposition of any encumbrance  upon any property or assets of
the Company under any agreement or commitment to which the Company is a party or
by which any of the  properties  or assets of the  Company are  subject,  or (c)
violates any statute, law, regulation, or rule, or any judgement decree or order
of any court applicable to the Company.

         6. No consent, approval or authorization of, or declaration,  filing or
registration  with,  any  governmental  body is required in connection  with the
execution,  delivery and performance of the Agreement or the consummation of any
of the transactions contemplated by the Agreement.

         I hereby confirm to you that,  with the exception of the insured claims
reflected on the  Disclosure  Statement,  if any,  there are no  proceedings  or
actions  by or  before  any  court  or  governmental  body  pending  or  overtly
threatened  against or involving the Company or that questions or challenges the
validity  of the  Agreement  or any action  taken or to be taken by the  Company
pursuant to the Agreement or in connection with the transactions contemplated by
the Agreement,  and the Company is not subject to any judgement  order or decree
having prospective effect.

                                           Very truly yours,

<PAGE>

                                    EXHIBIT E

                        Purchaser's Officers' Certificate

  Purchaser shall have delivered to the Sellers a certificate, dated the Closing
Date and  executed  by the  president  or  vice-president  or other  officer  of
Purchaser, substantially in the form and to the effect of Exhibit E hereto.

         I,  the  undersigned,   the  ________  of  ISG  Resources,   Inc.  (the
"Company"), a Utah corporation, do hereby certify that:

1. This  Certificate is being delivered at the Closing today pursuant to Section
__ of the Stock Purchase Agreement (the "Agreement") dated May __, 1999, between
ISG Resources, Inc., a Utah corporation  ("Purchaser"),  and William __. Leslie,
an  individual  residing in the state of  Montana.  Unless  otherwise  indicated
herein,  capitalized terms used in this Certificate shall have the same meanings
given to them in the Agreement.

2. Attached hereto as Exhibit __-1 is a true copy of the Board Resolution of the
Company with respect to the Agreement.

         IN WITNESS WHEREOF,  the undersigned has duly executed this Certificate
as of the date hereof.

                                            ___________________
                                            By: _______________
                                            ________, ISG Resources, Inc.DON'S BUILDING SUPPLY L.L.P.

                     (A Texas Limited Liability Partnership)

                             PARTNERSHIP REGULATIONS

<PAGE>

                                                  TABLE OF CONTENTS

                                                                           Page

ARTICLE I         DEFINITIONS..................................................1

    1.1  Definitions...........................................................1

ARTICLE II        FORMATION OF THE COMPANY.....................................3

    2.1  Name and Formation....................................................3
    2.2  Principal Place of Business...........................................4
    2.3  Principal Office......................................................4
    2.4  Term..................................................................4
    2.5  Purposes and Powers...................................................4

ARTICLE III   MANAGEMENT.......................................................4

    3.1  Management by Board of Directors......................................4
    3.2  Board of Directors....................................................5
    3.3  Officers..............................................................6
    3.4  Committees of the Board of Directors..................................9

ARTICLE IV  INDEMNIFICATION...................................................10

    4.1  Liability of Director or Officer of the Company for Certain Acts.....10
    4.2  Indemnification of Director, Officer and Partners of the Company.....10

ARTICLE V         MEETINGS OF BOARD OF DIRECTORS..............................12

    5.1  Meetings.............................................................12
    5.2  Place of Meetings....................................................12
    5.3  Notice of Meetings...................................................12
    5.4  Meetings of All Directors............................................12
    5.5  Quorum...............................................................12
    5.6  Manner of Acting.....................................................12
    5.7  Action by Directors Without a Meeting................................13
    5.8  Waiver of Notice.....................................................13
    5.9  Conduct of Meetings..................................................13

ARTICLE VI   CONTRIBUTIONS TO CAPITAL AND CAPITAL ACCOUNTS....................13

    6.1  Capital Contributions................................................13
    6.2  Units................................................................13
    6.3  Withdrawal or Reduction of Partners' Contributions to Capital........14
    6.4  Liability of Partners................................................14
    6.5  Deficit Capital Accounts.............................................14

ARTICLE VII   ALLOCATIONS, DISTRIBUTIONS, ELECTIONS

                  AND REPORTS.................................................14

    7.1  Allocations of Profits and Losses....................................14
    7.2  Distributions........................................................14
    7.3  Tax Withholdings.....................................................16
    7.4  Limitation Upon Distributions........................................16
    7.5  Accounting Principles................................................16
    7.6  Records and Reports..................................................17
    7.7  Returns and Other Elections..........................................17

ARTICLE VIII  TRANSFERABILITY.................................................17

    8.1  Restrictions on Transfer of Interests in the Company.................17
    8.2  Assignees............................................................18
    8.3  Substituted and Additional Partners..................................18
    8.4  Continuing Liability of Partners.....................................19

ARTICLE IX    DISSOLUTION AND TERMINATION.....................................19

    9.1  Dissolution..........................................................19
    9.2  Distribution of Assets Upon Dissolution..............................20

ARTICLE X         MEETINGS OF PARTNERS........................................20

    10.1 Place and Manner of Meetings.........................................20
    10.2 Special Meetings of Partners.........................................20
    10.3 Notice of Meetings of Partners.......................................20
    10.4 Quorum...............................................................20
    10.5 Registered Partners..................................................21
    10.6 Proxies..............................................................21
    10.7 Conduct of Meetings..................................................21
    10.8 Fixing Record Dates for Matters Other than Consents to Actions.......21
    10.9 Fixed Record Dates for Consents to Action............................21
    10.10Actions Without a Meeting............................................22
    10.11Nature of Partnership Interest.......................................22

ARTICLE XI    MISCELLANEOUS PROVISIONS........................................22

    11.1 Notices..............................................................22
    11.2 Waiver of Notice.....................................................22
    11.3 Application of Texas Law.............................................23
    11.4 No Action for Partition..............................................23
    11.5 Headings and Sections................................................23
    11.6 Amendment of Partnership Agreement and Partnership Regulations.......23
    11.7 Registered Limited Liability Partnership.............................23
    11.8 Resignation..........................................................23
    11.9 Numbers and Gender...................................................23
    11.10Binding Effect.......................................................24
    11.11Counterparts.........................................................24

ATTACHMENT:

SCHEDULE A -    Names and Units Owned of the Partners

<PAGE>

                             PARTNERSHIP REGULATIONS

                                       OF

                          DON'S BUILDING SUPPLY L.L.P.

         These  Partnership  Regulations  are hereby adopted as the  Partnership
Regulations  of  DON'S  BUILDING  SUPPLY  L.L.P.,  a  Texas  limited   liability
partnership (the "Company"),  and are hereby confirmed and approved for good and
valuable consideration.

                                 R E C I T A L S

A.   The Predecessor Entity, as hereinafter  defined,  was organized on November
     9, 1981.

B.   The Company  was  created as general  partnership  by a  conversion  of the
     Predecessor Entity into the Company on December 31, 1998.

C.   The Partnership Agreement of the Company was executed on December 31, 1998.

D.   On  December  31,  1998 the  Company  registered  as a  registered  limited
     liability partnership.

E.   The  Partnership   Agreement   contemplates  the  adoption  of  Partnership
     Regulations  that  would  have  the  effect  of  amending  the  Partnership
     Agreement  to  provide  detailed  provisions  as to  the  agreement  of the
     Partners regarding the ownership and operation of the Company.

                              R E G U L A T I O N S

                                    ARTICLE I
                                   DEFINITIONS

         I.1  Definitions.   The  following  terms  used  in  these  Partnership
Regulations  shall  have the  following  meanings  (unless  otherwise  expressly
provided herein):

                  (a) "Act" shall mean the Texas Revised Partnership Act, as the
same may be amended from time to
time.

                  (b) "Partnership Agreement" has the meaning given that term in
Section 2.1 hereof.

                  (c)  "Board  of  Directors"  means  the  committee  designated
pursuant to Article III.

                  (d) "Capital Account" means, with respect to any Partner,  the
account maintained for such Partner in a manner consistent with the requirements
of the  Act,  recognizing  that  distributions  to the  Partners  are to be made
without regard to Capital Accounts.

                  (e)  "Capital  Contribution"  means  any  contribution  to the
capital of the Company in cash or property by a Partner whenever made.

                  (f)  "Code"  means  the  Internal  Revenue  Code of  1986,  as
amended.

                  (g) "Company"  means DON'S  BUILDING  SUPPLY  L.L.P.,  a Texas
limited liability partnership.

                  (h) "Director" means a Manager designated  pursuant to Section
3.1(b) hereto.

                  (i) "Disposition" means any sale, transfer, encumbrance, gift,
donation,  assignment,  pledge,  hypothecation  or  other  disposition,  whether
voluntary  or  involuntary  and whether  during a Partner's  lifetime or upon or
after his or her death, including without limitation, any partition of community
property and any  Disposition  by operation of law, by court order,  by judicial
process or by foreclosure, levy or attachment.

                  (j) "Fiscal Year" means the Company's fiscal year, which shall
be the calendar year.

                  (k) "Losses"  means,  for each Fiscal Year,  the net losses of
the Company  determined in accordance  with accounting  principles  consistently
applied from year to year employed under the accrual method of accounting and as
reported,  separately  or in the  aggregate,  as  appropriate,  on the Company's
information tax return filed for federal income tax purposes.

                  (l) "Majority" means, with respect to any referenced groups of
members of the Board of Directors or any committee, a combination of any of such
persons  constituting  more than fifty  percent of the number of such persons of
such referenced group who are then elected and qualified.

                  (m)  "Majority  in  Interest"  means,   with  respect  to  the
Partners,  a  combination  of such Persons (one or more) holding more than fifty
percent of the issued and outstanding Units.

                  (n)  "Partner"  means each Person  designated  as a Partner on
Schedule A,  attached  hereto and hereby made a part  hereof,  any  successor or
successors to all or any part of any such Person's  interest in the Company,  or
any additional  Partner  admitted as a Partner of the Company in accordance with
Article  VIII,  each in the capacity as a Partner of the  Company,  but does not
include any who has ceased to be a Partner of the Company.  "Partners" means all
such Persons collectively in their capacity as Partners of the Company.

                  (o) "Partnership Interest" means the percentage of partnership
interest in the Company held by a Partner,  which  percentage  shall be equal to
the Unitholding Percentage of such Partner.

                  (p) "Permitted  Disposition"  means any of the following kinds
of Dispositions:

                           (i) A Disposition of the community  property or other
interest  in all or any part of the  interests  in the  Company  of a  Partner's
spouse, upon the death of such spouse, to the surviving Partner;

                           (ii) A Disposition of the community property or other
interest  in all or any part of the  interests  in the  Company  of a  Partner's
spouse  to such  Partner  in  connection  with the  termination  of the  marital
relationship of the Partner and the Partner's spouse;

                           (iii) A Disposition made pursuant to and as permitted
by the terms of these Partnership Regulations.

                  (q) "Person" shall have the meaning given that term in Section
1.01(14) of the Act.

                  (r) "Predecessor  Entity" means Don's Building Supply, Inc., a
Texas  corporation  that was  converted  into  the  Company  (the  "Conversion")
effective on December 31, 1998.

                  (s) "Profits"  means, for each Fiscal Year, the net income and
net gains of the Company  determined in accordance  with  accounting  principles
consistently  applied  from  year  to  year as  reported,  separately  or in the
aggregate,  as  appropriate,  on the Company's  information tax return filed for
federal income tax purposes.

                  (t)   "Partnership   Regulations"   means  these   Partnership
Regulations  of the Company as  originally  adopted and as amended  from time to
time.

                  (u) "Unitholding Percentage" of a Partner means the percentage
that the Units held by such Partner bears to the aggregate  number of issued and
outstanding Units.

                  (v)  "Units"  means the  units of  ownership  in the  Company,
denominated as Units of Partnership Interest of the Company.

                                   ARTICLE II
                            FORMATION OF THE COMPANY

         II.1 Name and  Formation.  The name of the  Company  is Don's  Building
Supply  L.L.P.  The  Partnership  Agreement  of the  Company  (the  "Partnership
Agreement") was executed on December 31, 1998.

         II.2 Principal  Place of Business.  The principal  place of business of
the Company  within the State of Texas shall be Dallas,  Texas.  The Company may
locate its  place(s) of  business  and  registered  office at any other place or
places  as the  Board of  Directors  may from  time to time  deem  necessary  or
advisable.

         II.3 Principal Office.  The Company's initial principal office shall be
at 2327 Langford, Dallas, Texas 75208.

         II.4 Term.  The term of  existence of the Company  shall be  perpetual,
unless the Company is earlier dissolved in accordance with either the provisions
of the Partnership Agreement, these Partnership Regulations or the Act.

         II.5 Purposes and Powers.

                  (a) The purposes and  character of the business of the Company
shall be to accomplish any or all lawful business for which  partnerships may be
organized under the Act.

                  (b) The  Company  shall  have  any and all  powers  which  are
necessary, proper, advisable, convenient, or desirable to carry out the purposes
and business of the Company,  to the extent the same may be legally exercised by
partnerships under the Act. The Company shall carry out the foregoing activities
pursuant  to the  arrangements  set forth in the  Partnership  Agreement  of the
Company and these Partnership Regulations.

                                   ARTICLE III
                                   MANAGEMENT

         III.1    Management by Board of Directors.

                  (a) General.  The business and affairs of the Company shall be
managed by a committee to be known as the Board of Directors.

                  (b) Duties and  Obligations.  Subject  to  Section  4.1,  each
person  serving on the Board of Directors (a  "Director")  and/or as officers of
the Company  shall  exercise  such  person's  business  judgment in managing the
business, operations and affairs of the Company.

                  (c) No Authority  of Partners or  Directors  to Bind  Company.
Unless  authorized  to do so by the  Partnership  Agreement,  these  Partnership
Regulations or the Board of Directors, no Partner,  Director,  agent or employee
of the Company shall have any power or authority to bind the Company in any way.

                  (d) Voting by the Units.  Actions to be taken by the  Partners
shall be approved by Partners holding a majority of the Units.

         III.2    Board of Directors.

                  (a) Management. Any decisions to be made by the Partners under
the Act, the Partnership  Agreement or these  Partnership  Regulations  shall be
made by the Board of Directors unless specifically provided otherwise.

                  (b)  Decisions  Reserved  to  Partners.   Notwithstanding  the
provisions of Section 3.2(a) or any other provisions herein to the contrary, the
Board of Directors may not cause the Company to do any of the following  actions
without the agreement of the Partners holding at least a majority of the Units:

                           (i) the merger or  consolidation  of the Company with
and into any corporation,  limited  liability company or other entity, or of any
corporation,  limited  liability  company  or  other  entity  with  and into the
Company, or the participation of the Company in any exchange of interests;

                           (ii) the  conversion of the Company into another form
of entity;

                           (iii) the  liquidation or dissolution of the Company;
and

                           (iv) the delegation to an agent of the Company of the
power to take any of the actions referred to in the foregoing clauses.

                  (c) Designation  and Election of Directors.  The initial Board
of Directors shall consist of those  individuals  designated as the directors in
the Partnership Agreement.  Thereafter,  the Board of Directors shall be elected
by majority vote of the Partners.  Each of the members of the Board of Directors
shall serve until his or her  resignation or death or until his or her successor
shall be elected as provided herein.  Each Director elected shall have one vote.
Except as  provided  in Section  3.2(b),  the  Directors  shall in all  respects
relating to the Company represent and act on behalf of the Partners.

                  (d)      General.

                           (i) Resignation.  Any Director may resign at any time
by giving notice to the other  members of the Board of  Directors.  A Director's
resignation  shall take effect at the time  specified in the notice and,  unless
otherwise  specified  therein,  the acceptance of such resignation  shall not be
necessary to make it effective.

                           (ii) Vacancies. Any vacancy occurring in the Board of
Directors shall be filled by
majority vote of the Partners.

                           (iii)  Meetings.  Meetings of the Board of  Directors
shall be held in accordance with Article V.

                           (iv)  Reimbursement.  The Directors shall be entitled
to receive such compensation as shall be determined by the Directors,  and shall
be entitled to reimbursement for reasonable "out-of-pocket" expenses incurred in
connection with their services to the Company.

                           (v) Indemnification.  The Company shall indemnify the
Directors to the extent set forth in Article IV.

         III.3    Officers.

                  (a)  Election  of  Officers.  The  members  of  the  Board  of
Directors,  at their first meeting, shall elect such officers as the Board shall
choose to elect.  No  officers  need be a Partner  or a resident  of Texas.  The
Directors may elect or appoint such other officers and agents as they shall deem
necessary,  who shall be appointed for such terms and shall exercise such powers
and perform such duties as shall be determined from time to time by the Board of
Directors. Any two or more offices may be held by the same Person.

                           (i) Each  officer of the  Company  shall hold  office
until his or her successor is chosen and is qualified in such officer's stead or
until the death, resignation or removal from office of such officer.

                           (ii) Any  vacancy  in any  office  because  of death,
resignation,  removal or otherwise may be filled by such person as is elected or
appointed by a majority vote of the Board of Directors.

                           (iii) The  compensation  of all  officers  and agents
shall be fixed by the Board of Directors or by a committee  formed and appointed
by the  Board  of  Directors,  as  allowed  pursuant  to  Section  3.4 of  these
Partnership Regulations.

                  (b) Authority and Duties. The officers of the Company,  if the
Board  chooses to elect one or more of such  officers,  shall have the authority
and shall exercise the powers and perform the duties  specified below and as may
be  additionally  specified  by the  Board of  Directors  or  these  Partnership
Regulations (and in all cases where the duties of any officer are not prescribed
by these Partnership  Regulations or the Board of Directors,  such officer shall
follow the orders and instructions of the President):

                           (i) President.  The President  shall preside over the
general and active management of the business of the Company,  and shall direct,
manage and  control the  business of the Company to the best of the  President's
ability.  The  President  shall  serve  until  resignation  or  dissolution  and
liquidation  of the Company or removal by the Board of Directors.  The President
shall,  subject to the  provisions  of Section  3.3(d),  have full and  complete
authority, power and discretion to make any and all decisions and do any and all
things that the President deems to be reasonably  required in furtherance of the
Company's  business  and  objectives.  Without  limiting the  generality  of the
foregoing,   the  President  or  such  subordinate  officer  designated  by  the
President,  or any officer duly  authorized by the Board of Directors shall have
the power and authority on behalf of the Company:

                                  (1) to purchase  liability and other insurance
to protect the Company's property and business;

                                  (2) to invest any  Company  funds  temporarily
(by way of example but not limitation) in time deposits, short-term governmental
obligations, commercial paper or other investments;

                                  (3)  to  employ  accountants,  legal  counsel,
managing  agents or other experts,  employees or agents to perform  services for
the Company and to compensate them from Company funds;

                                  (4) to negotiate  with employees and any labor
organization representing employees of the Company; and

                                  (5) to carry out all orders and resolutions of
the Board of Directors.

                           (ii)  Vice-Presidents.  The Vice  Presidents,  unless
otherwise  determined  by the  Board  of  Directors  shall,  in the  absence  or
disability  of the  President,  perform  the duties and have the  authority  and
exercise the powers of the  President.  The  Vice-Presidents  shall perform such
other duties and have such other  authority and powers as the Board of Directors
may from  time to time  prescribe  or as the  President  may  from  time to time
delegate.

                           (iii)  Secretary.  The  Secretary  shall  attend  all
meetings of the Board of  Directors  and  Partners  and record all votes and the
minutes  of all  proceedings  in a book to be kept for that  purpose  and  shall
perform like duties for any committee,  if requested.  The Secretary shall give,
or cause to be given,  notice of the  meetings  of the  Board of  Directors  and
Partners  where  such  notices  are  required  to be given by these  Partnership
Regulations.  The Secretary shall be under the supervision of the President, and
shall perform such other duties and have such other  authority and powers as the
Board of Directors may from time to time  prescribe or as the President may from
time to time delegate.

                           (iv) Treasurer.  The Treasurer shall have the custody
of the Company  funds and shall keep full and accurate  accounts of receipts and
disbursements  of the Company,  and shall deposit all monies and other  valuable
effects in the name and to the credit of the Company in such depositories as may
be designated by the Board of Directors.  The Treasurer shall disburse the funds
of the  Company  as may be  ordered  by the Board of  Directors,  taking  proper
vouchers for such disbursements,  and shall render to the President and Board of
Directors,  at the regular meetings of the Board of Directors,  or whenever they
may require it, an account of all transactions as Treasurer and of the financial
condition of the Company.  If required by the Board of Directors,  the Treasurer
shall give the Company a bond in such form, in such sum, and with such surety or
sureties as shall be  satisfactory  to the Board of  Directors  for the faithful
performance of the duties of the  Treasurer's  office and for the restoration to
the  Company,  in case of the  Treasurer's  death,  resignation,  retirement  or
removal from office, of all books, papers,  vouchers, money or other property of
whatever  kind  in the  Treasurer's  possession  or  under  his  or her  control
belonging to the Company. The Treasurer shall perform such other duties and have
such other  authority and powers as the Board of Directors may from time to time
prescribe or as the President may from time to time delegate.

                  (c)  Execution  of  Contracts.  Each of the  President or such
subordinate  officer or  officers  designated  by the  President  or any officer
designated  by the Board of  Directors  shall have the  authority  to execute on
behalf of the Company all  agreements,  instruments  and  documents,  including,
without  limitation,  checks,  drafts,  notes and other negotiable  instruments,
mortgages, deeds of trusts, security agreements, financing statements, documents
providing for the acquisition,  mortgage or disposition of the Company property,
assignments,  bills  of  sale,  leases,  partnership  agreements  and any  other
instruments  or documents  necessary to  effectuate  any actions which have been
approved by the  Partners or the Board of Directors  (if such  actions  require,
under the Act, the Partnership Agreement or these Partnership  Regulations,  the
approval of the Partners or the Board of Directors) or by the President (if such
actions  do not  require  under  the Act,  the  Partnership  Agreement  or these
Partnership Regulations the approval of the Partners or the Board of Directors).

                  (d)   Actions   Requiring   Board   of   Directors   Approval.
Notwithstanding  any  other  provision  of the  Partnership  Agreement  or these
Partnership  Regulations and in addition to any other actions  requiring Partner
or Board of Directors  approval as provided  herein or in the Act, the following
actions on behalf of the  Company  shall  require  the  approval of the Board of
Directors:

                           (i) the sale, lease, transfer or other disposition of
all or a material part of the Company's assets or business;

                           (ii) any  increase or decrease in the  capitalization
of the Company;

                           (iii) any  acquisition  by the  Company of the stock,
assets or business of another  corporation  or entity or any  investment  by the
Company of  corporate  funds in another  corporation  or entity,  including  the
creation of any subsidiary;

                           (iv) the admission of any new Partner to the Company;

                           (v) the  lending of Company  funds to any  Partner or
any affiliate of any Partner;

                           (vi) any guarantee by the Company of any indebtedness
or other obligation of any kind of any Partner or any affiliate of a Partner;

                           (vii)   the  entry   into,   or  any   amendment   or
modification or cancellation  of, a management,  service,  or other agreement or
contract between the Company and a Partner or its affiliates;

                           (viii) the making of a material  tax  election  under
the Code applicable to the Company unless  specifically  allowed pursuant to the
terms of these Partnership Regulations;

                           (ix) the confession of a judgment by the Company; (x)
the filing of bankruptcy by the Company;

                           (xi) the offering of any  securities  or  Partnership
Interests to third parties by the Company.

                           (xii) the incurrence of any  indebtedness,  making of
any contract (or any material amendment to any contract formerly approved in the
Company's  annual  budget or by the Board of  Directors),  making of any capital
expenditure  or  investment,  the  disposal  or pledge of  Company  property  or
settlement of any claim or litigation in an amount in excess of $5,000;

                           (xiii) the  appointment  or removal of any officer of
the Company;

                           (xiv)  the  acquisition,  expansion  or  disposal  of
facilities of the Company;

                           (xv) any other  agreement  which would  substantially
affect the operation of the Company.

Notwithstanding  the  preceding  provisions  of  this  subparagraph  (d)  to the
contrary,  the  approval of the Board of  Directors  shall not be required  with
respect to any of the actions listed above if such actions have been approved in
writing by Partners holding a majority of the Units.

                  (e)      General.

                           (i)  Removal.  Any officer may be removed at any time
by a  majority  vote  of  the  Board  of  Directors  whenever  in the  Board  of
Directors's  best  judgment  the best  interests  of the Company  will be served
thereby,  but such removal will be without  prejudice to the contract rights, if
any, of the person so removed.  Election or  appointment of an officer shall not
in itself create contract rights.

                           (ii) Resignation. Any officer may resign at any time,
subject to the rights or obligations  under any existing  contracts  between the
officer and the Company,  by giving written notice to the President or the Board
of Directors.  An officer's  resignation shall take effect at the time specified
in the notice, and unless otherwise  specified  therein,  the acceptance of such
resignation shall not be necessary to make it effective.

                           (iii)  Vacancies.  A vacancy in any  office,  however
occurring,  may be filled by the  Board of  Directors  as  provided  in  Section
3.3(a)(ii) for the unexpired portion of the term.

                           (iv) Indemnification. The Company shall indemnify the
Directors, officers, and Partners to the extent set forth in Article IV.

         III.4 Committees of the Board of Directors.  The Board of Directors may
designate  one or more  committees,  each of which shall be  comprised of one or
more of its members,  and may  designate one or more of its members as alternate
members of any committee,  who may,  subject to any  limitations  imposed by the
Board of Directors,  replace  absent or  disqualified  members at any meeting of
that  committee.  Any such  committee,  to the extent provided in the resolution
establishing  it, shall have and may exercise all of the  authority  that may be
exercised  by the  Board of  Directors.  Regular  and  special  meetings  of any
committee may be held on such dates, at such times and upon such notice (if any)
as shall be provided in the  resolution  establishing  such committee or, if not
addressed  in such  resolution,  as may be  determined  by the  members  of such
committee. The Board of Directors may dissolve any committee at any time.

                                   ARTICLE IV
                                 INDEMNIFICATION

         IV.1  Liability of Director or Officer of the Company for Certain Acts.
Each Director and officer of the Company shall  exercise such person's  business
judgment in managing the business, operations and affairs of the Company. Absent
fraud,  deceit,  gross  negligence,  willful  misconduct  or a wrongful  taking,
neither a Director nor an officer of the Company shall be liable or obligated to
the  Partners or to the Company  for any  mistake of fact or  judgment,  for the
doing of any act, or for the failure to do any act in  conducting  the business,
operations  and affairs of the Company  which may cause or result in any loss or
damage to the  Company or its  Partners.  No  Director or officer of the Company
guarantees the return of the Partners' capital contributions or a profit for the
Partners  from the  operations  of the  Company.  No  Director or officer of the
Company shall be responsible to any Partner  because of a loss of such Partner's
investment,  unless the loss shall  have been the  result of the  Director's  or
officer's fraud,  deceit,  gross  negligence,  willful  misconduct or a wrongful
taking.  Neither the  Directors nor officers of the Company shall be jointly and
severally liable for fraud,  deceit,  gross  negligence,  willful  misconduct or
wrongful taking, but each such person shall only be liable for such person's own
actions and omissions.

         IV.2  Indemnification of Director, Officer and Partners of the Company.

                  (a) Right to Indemnification.  The Company shall indemnify, to
the  fullest  extent   permitted  by  law  (including   without   limitation  in
circumstances  in which, in the absence of this Section 4.2(a),  indemnification
would  be  discretionary  under  the  laws of Texas or  limited  or  subject  to
particular  standards  of conduct  under such laws) each  Director,  officer and
Partner of the Company  against all costs,  expenses  and  liability,  including
reasonable  attorneys' fees,  incurred in connection  with,  relating to or as a
result of any action, suit or proceeding to which a Director, officer or Partner
of the Company may be involved or made a party by reason of being or having been
a Director,  officer or Partner of the Company, or while a Director,  officer or
Partner of the  Company,  is or was  serving at the  request of the Company as a
manager, director,  officer, partner, trustee,  employee,  fiduciary or agent of
any other  domestic  or  foreign  limited  liability  partnership,  corporation,
partnership,  joint  venture,  trust,  employee  benefit plan or other entity or
enterprise.

                  (b) Advancement of Expenses.  In the event of any action, suit
or proceeding in which a Director, officer or Partner of the Company is involved
or which  may give  rise to a right of  indemnification  under  Section  4.2(a),
following written request to the Company by the Director,  officer or Partner of
the Company, the Company shall pay to such Director,  officer or Partner, to the
fullest extent permitted by law (including  without  limitation in circumstances
in which, in the absence of this Section  4.2(b),  advancement of expenses would
be  discretionary  under the laws of Texas or limited  or subject to  particular
standards of conduct under such laws), amounts to cover expenses incurred by the
Director, officer or Partner in, relating to or as a result of such action, suit
or proceeding in advance of its final disposition.

                  (c)  Settlements.  The Company  shall not be liable under this
Section 4.2 for any amounts paid in settlement of any action, suit or proceeding
effected  without the approval of the Board of Directors.  The Company shall not
settle  any  action,  suit or  proceeding  in any manner  that would  impose any
penalty or limitation on a Director,  officer or Partner of the Company  without
the  Director,  officer  or  Partner's  written  consent.  Consent to a proposed
settlement of any action, suit or proceeding shall not be unreasonably  withheld
by the Board of Directors.

                  (d) Liability Insurance. The Company may purchase and maintain
insurance  on behalf of any person who is or was a Director,  officer or Partner
of the  Company  or who is or was  serving at the  request  of the  Company as a
manager, director,  officer, partner, trustee,  employee,  fiduciary or agent of
any  other  domestic  or  foreign   limited   partnership,   limited   liability
partnership,  corporation,  partnership,  joint venture, trust, employee benefit
plan or other entity or enterprise  against any liability  asserted  against and
incurred by a Director,  officer or Partner of the Company in any such  capacity
or arising out of a Director,  officer or Partner's  status as such,  whether or
not the  Company  would have the power to  indemnify  such person  against  such
liability  under the  provisions  of this  Section.  Any such  insurance  may be
procured  from any  insurance  company  designated  by the  Board of  Directors,
whether  such  insurance  company is formed under the laws of Texas or any other
jurisdiction of the United States or elsewhere.

                  (e) Other Rights and Remedies.  The rights to  indemnification
and advancement of expenses provided in this Section shall be in addition to any
other rights a Director, officer or Partner of the Company may have or hereafter
acquire  under any law,  provision of the  Partnership  Agreement,  any other or
further  provision  of  these  Partnership  Regulations,  vote of the  Board  of
Directors,  agreement or otherwise.  The Company shall have the right, but shall
not be obligated,  to indemnify or advance  expenses to any employee or agent of
the Company in accordance with and to the fullest extent permitted by law.

                  (f)  Applicability and Effect.  The rights to  indemnification
and advancement of expenses provided in this Section shall be applicable to acts
or omissions that occurred prior to the adoption of this Section, shall continue
as to any  Director,  officer or Partner of the  Company  during the period such
Director, officer or Partner serves in any one or more of the capacities covered
by this Section,  shall continue thereafter so long as the Director,  officer or
Partner may be subject to any possible  action,  suit or proceeding by reason of
the fact that the Director,  officer or Partner served in any one or more of the
capacities covered by this Section, and shall inure to the benefit of the estate
and personal  Directors of each such person.  Any repeal or modification of this
Section or of any  provision  hereof shall not affect any rights or  obligations
then existing.  All rights to indemnification under this Section shall be deemed
to be provided by a contract  between the Company and each Director,  officer or
Partner of the Company.

                  (g)  Limitation on Partners'  Liability.  The  indemnification
provided for in this  Section  shall in no event cause the Partners to incur any
liability,  nor shall it result in any  liability  of the  Partners to any third
party.

                                    ARTICLE V
                         MEETINGS OF BOARD OF DIRECTORS

         V.1 Meetings.  Meetings of the Board of Directors may be called for any
purpose,  unless otherwise prescribed by statute, by the President or any of the
Directors.

         V.2 Place of Meetings.  The Directors  may designate any place,  either
within or outside the State of Texas,  as the place of meeting for meetings.  If
no designation  is made,  the place of meeting shall be the principal  office of
the Company in the State of Texas. Directors may participate in such meetings by
means of conference telephone and similar  communications  equipment by means of
which  all  Persons  participating  in the  meeting  can hear  each  other,  and
participation  in a meeting as  provided  herein  shall  constitute  presence in
person at such meeting,  except where a Person  participates  in the meeting for
the express  purpose of  objecting  to the  transaction  of any  business on the
ground that the meeting is not lawfully called or convened.

         V.3 Notice of  Meetings.  The Chairman of the Board of  Directors,  the
President  or the  Person(s)  calling the meeting  shall  cause  written  notice
stating  the place,  day and hour of the  meeting  and, in the case of a special
meeting,  the purpose for which the meeting is called to be  delivered  not less
than two (2) days before the date of the meeting,  either personally or by mail,
to each Director entitled to vote at such meeting.  If mailed, such notice shall
be deemed to be given two  business  days  following  when it  deposited  in the
United  States  mail,  addressed  to the  Director at such  Director's  business
address as set forth in the records of the Company,  with postage prepaid.  If a
meeting is adjourned to another  place or time,  notice need not be given of the
adjourned  meeting if the time and place thereof are announced at the meeting at
which the adjournment is taken.

         V.4 Meetings of All  Directors.  If all of the Directors  shall meet at
any time and place,  either within or outside of the State of Texas, and consent
to the holding of a meeting at such time and place,  such meeting shall be valid
without call or notice, and any action taken at such meeting shall be lawful.

         V.5 Quorum.  A quorum  shall  consist of a majority  of the  Directors;
provided that in the event of a quorum not being present,  such meeting shall be
adjourned  to a date one (1) day after the date of such  meeting but at the same
time and location and any Directors  then in attendance  shall be deemed to be a
quorum.

         V.6 Manner of Acting. If a quorum is present,  the majority vote of the
Directors  entitled  to  vote  on the  subject  matter  shall  be the act of the
Partners.

         V.7 Action by Directors Without a Meeting. Action required or permitted
to be taken at a meeting of the Board of  Directors or the Board of Managers may
be taken without a meeting if the action is evidenced by written consents signed
by all Directors or Managers entitled to vote.

         V.8 Waiver of Notice.  When any notice is  required  to be given to any
Director,  a waiver  thereof in writing  signed by the person  entitled  to such
notice,  whether  before,  at,  or  after  the  time  stated  therein,  shall be
equivalent to the giving of such notice. By attending a meeting, a Director: (a)
waives  objection to lack of notice or defective  notice of such meeting  unless
the  Director,  at the  beginning of the meeting,  objects to the holding of the
meeting or the transaction of business at the meeting,  and (b) waives objection
to consideration  at such meeting of a particular  matter not within the purpose
or purposes  described in the notice of such meeting unless the Director objects
to considering the matter when it is presented.

         V.9 Conduct of Meetings.  All meetings of the Board of Directors  shall
be presided  over by the chairman of the  meeting,  who shall be a member of the
Board of Directors.  The chairman of any meeting of the Board of Directors shall
determine the order of business and the procedure at the meeting, including such
regulation  of the manner of voting and the  conduct  of  discussion  as seem in
order to him or her.

                                   ARTICLE VI
                  CONTRIBUTIONS TO CAPITAL AND CAPITAL ACCOUNTS

         VI.1     Capital Contributions.

                  (a) As a result of the Conversion, each Partner contributed to
the capital of the Company his proportionate interest in the assets and business
of the Predecessor Entity. As a result of the Conversion,  each Partner received
his or her Partnership  interest and the Units described on Schedule A, attached
hereto.

                  (b) If the  Board  of  Directors  determines  that  additional
capital  contributions are needed to carry out the purposes of the Company,  the
Board of  Directors  may  request  that the  Partners  make  additional  cash or
property Capital Contributions to the Company to purchase additional Units to be
issued by the  Company.  No Partner  shall be  required  to make any  additional
Capital Contribution without the written consent of all the Partners.

                  (c)  No  Partner   shall  be  paid  interest  on  any  Capital
Contribution to the Company.

         VI.2     Units.

                  (a)  Each   Partner's   interest  in  the  Company   shall  be
represented by units of Partnership  Interest  denoted as Units. The Units owned
by the Partners in the Company immediately after the Conversion are set forth on
the attached  Schedule A. Subject to the  provisions of Section 8.3,  additional
Partners  shall  receive the number of Units  determined  by the  Partners.  The
number of Units issued to an additional  Partner,  and the Capital  Contribution
required for the issuance of such Units,  shall be within the sole discretion of
the Partners.

                  (b) The  Board  of  Directors,  in its  discretion,  shall  be
empowered  to determine  the form of any stock  certificate  that will  evidence
Units of the Company.

         VI.3     Withdrawal or Reduction of Partners' Contributions to Capital.

                  (a) A Partner shall not receive out of the Company's  property
any  part of his or her  Capital  Contributions  until  all  liabilities  of the
Company,  except  the  liabilities  to  Partners  on  account  of their  Capital
Contributions,  have  been  paid  or  there  remains  property  of  the  Company
sufficient to pay such liabilities.

                  (b) No  Partner  shall have the right to  withdraw  all or any
part of his or her Capital Contribution, except as may be otherwise specifically
provided  in these  Partnership  Regulations.  Under  circumstances  involving a
return of any Capital Contributions,  no Partner shall have the right to receive
property other than cash.

                  (c) No Partner  shall have  priority  over any other  Partner,
either as to the return of Capital  Contributions  or as to  Profits,  Losses or
distributions;  provided  that  this  subsection  shall  not  apply to loans (as
distinguished  from  Capital  Contributions)  which a  Partner  has  made to the
Company.

         VI.4  Liability of Partners.  No Partner shall be liable for the debts,
liabilities  or  obligations  of the  Company.  No Partner  shall be required to
contribute any funds to the capital of the Company,  or to loan any funds to the
Company.

         VI.5 Deficit  Capital  Accounts.  No Partner will be required to pay to
the Company,  to any other  Partner,  or to any third party any deficit  balance
which may exist from time to time in the Partner's Capital Account.

                                   ARTICLE VII
                ALLOCATIONS, DISTRIBUTIONS, ELECTIONS AND REPORTS

         VII.1 Allocations of Profits and Losses.  The Profits and Losses of the
Company for each Fiscal Year shall be allocated among the Partners in accordance
with the rules applicable to S corporations for federal income tax purposes. Any
credit  available for federal income tax purposes  shall be allocated  among the
Partners in the same manner.

         VII.2  Distributions.  All  distributions  of  any  nature  whatsoever,
including, without limitation, partial returns of capital, profit distributions,
refinancing proceeds and liquidating distributions,  shall be made solely to the
Partners,  in proportion to their  respective  Units and without regard to their
Capital Account balances, so that, with respect to each such distribution,  each
Partner  or other  holder  of Units  will  receive  an equal  dollar  amount  of
distribution per Unit held as of the record date of such distribution.  Anything
in the Partnership  Agreement or these  Partnership  Regulations to the contrary
notwithstanding, each Unit shall confer upon the holder thereof identical rights
to distribution and liquidation  proceeds from the Company.  Distributions shall
be made if approved by the Board of Directors;  provided,  however,  anything in
these Partnership Regulations to the contrary  notwithstanding,  the Partnership
shall make the Minimum  Distributions,  as hereinafter  defined, to the Partners
each year in order to provide  the funds for the  Partners  to pay the  federal,
estate and local income taxes imposed on the income of the Partnership allocated
to the Partners.

                  (a)  The  "Minimum  Distributions"  for a year  shall  be such
distributions  to  Partners  or other  holders of Units so that each  Partner or
other  holder  of Units  will  receive  at least  the  amount  of his or her Tax
Distribution Amount, as hereinafter defined, for such year.

                  (b) To carry out the  obligation  to  distribute  the  Minimum
Distributions,  Net  Operating  Cash  Flow,  as  hereinafter  defined,  shall be
distributed  to the Partners or other  holders of Units in  accordance  with the
provisions  of  this  Section  7.2 at  least  a  reasonable  period  before  the
respective  Partners  or  other  holders  of Units  are  required  to pay  their
estimated and final  federal,  state and local income taxes on the income of the
Partnership  allocated to the Partners or other  holders of Units.  The Board of
Directors,  in its  discretion,  may  authorize the  distribution  of additional
amounts of Net  Operating  Cash Flow to the Partners or other  holders of Units.
Notwithstanding the foregoing, no distribution of the Net Operating Cash Flow of
the Partnership  shall be made if and to the extent that, after the distribution
is made, the liabilities of the  Partnership  shall exceed the fair market value
of the assets of the Partnership.

                  (c) For  purposes  of making the  Minimum  Distributions,  Net
Operating  Cash Flow for each  calendar  year or other  taxable  period shall be
distributed among the Partners or other holders of Units so that each Partner or
other  holder of Units  receives an equal amount per Unit held until the Minimum
Distributions  have been made;  i.e.,  each Partner or other holder of Units has
received at least such party's Tax Distribution Amount.

                           (i) The "Tax  Distribution  Amount"  of a Partner  or
other holder of Units for a year shall be an amount equal to the greater of: (1)
the combined  federal and state  income tax on the amount of such party's  Total
Taxable Income, as hereinafter  defined, for such period, which combined federal
and state income tax shall be  calculated  using the highest  combined tax rates
for  individuals  under  federal  and state law after  taking  into  account any
deductibility of such taxes on any other tax return; or (2) the combined federal
alternative minimum tax (as imposed by Sections 55 through 59 of the Code or the
subsequent  equivalent of such provisions) on the amount of such party's federal
alternative  minimum  taxable income and state income tax on the amount of state
taxable income or state  alternative  minimum taxable  income,  as applicable to
individuals, on the amount of such party's Total Taxable Income for such period,
which  combined  federal  alternative  minimum tax and state income tax shall be
calculated using the highest combined federal  alternative  minimum tax rate and
either  state  alternative  minimum  tax rates or state  income  tax  rates,  as
applicable to individuals,  after taking into account any  deductibility of such
taxes on any other tax return.

                           (ii)  In  the  event  Net  Operating   Cash  Flow  is
insufficient to distribute the Minimum Distributions for a year, such deficiency
shall be satisfied in the first subsequent calendar year that Net Operating Cash
Flow is available.

                           (iii) For purposes of this Agreement,  "Total Taxable
Income" means the net amount of taxable income of the Partnership allocated to a
Partner or other holder of Units for such period,  including without  limitation
the  allocation  to such party of all items of  income,  gains,  deductions  and
losses  required to be  separately  stated and  allocated  among the Partners or
other holders of Units for income tax purposes.

                           (iv)  In  the  event  that a  self-employment  tax or
similar  tax is imposed on a Partner or other  holder of Units based in whole or
in part on such party's  allocable  share of  Partnership  net income,  such tax
shall be deemed to constitute an income tax and the tax rate  applicable to such
self-employment or similar tax (taking into account the  deductibility,  if any,
of such  self-employment  or similar tax) shall be added to, and treated as such
constituent  part of, the income tax rate (and, if applicable,  the  alternative
minimum tax rate) of the applicable tax jurisdiction.

                  (d) "Net  Operating  Cash  Flow"  shall be  determined  in the
discretion  of the Board of Directors,  but generally  shall mean the gross cash
proceeds from  Partnership  operations less the portion thereof  required to pay
Partnership expenses less any reserves established by the Board of Directors for
direct operating expenses, taxes, maintenance,  insurance, capital expenditures,
repairs and other items deemed  reasonable  and necessary for the  Partnership's
business operations.  In addition, Net Operating Cash Flow shall include any net
cash proceeds  received from the sale,  financing or  refinancing of Partnership
assets.

         VII.3 Tax  Withholdings.  To the extent  the  Company  is  required  by
federal,  state  or  local  law or any tax  treaty  to  withhold  or to make tax
payments on behalf of or with respect to any Partner, the Company shall withhold
such  amounts  and make such tax  payments  as so  required.  The amount of such
payments shall constitute an advance by the Company to such Partner and shall be
repaid to the Company by reducing  the amount of the current or next  succeeding
distribution  or  distributions  which  would  otherwise  have been made to such
Partner or, if such  distributions  are not sufficient  for that purpose,  by so
reducing the proceeds of  liquidation  otherwise  payable to such Partner or, if
such proceeds are insufficient, such Partner shall pay to the Company the amount
of such insufficiency.

         VII.4  Limitation  Upon  Distributions.  The  Company  may  not  make a
distribution to its Partners to the extent that, immediately after giving effect
to the distribution,  all liabilities of the Company,  other than liabilities to
Partners with respect to their  interests and liabilities for which the recourse
of creditors is limited to  specified  property of the Company,  exceed the fair
value of the Company's  assets,  except that the fair value of the property that
is subject to the liability for which  recourse of creditors is limited shall be
included  in the  Company  assets  only to the extent that the fair value of the
property exceeds that liability.

         VII.5  Accounting  Principles.  The net income of the Company  shall be
determined  in accordance  with  accounting  principles  applied on a consistent
basis and  adequate  for the  Company  business  as  determined  by the Board of
Directors.

         VII.6 Records and Reports. At the expense of the Company,  the Board of
Directors shall maintain records and accounts of all operations and expenditures
of the Company.  At a minimum,  the Company shall keep at its principal place of
business the following records:

                  (a) A current list that states:

                           (i) The name and mailing address of each Partner; and

                           (ii) The Units owned by each Partner;

                  (b)  Copies of the  federal,  state and local  information  or
income tax returns for each of the Company's six most recent tax years;

                  (c) A copy of the Partnership  Agreement and these Partnership
Regulations,  all amendments or  restatements,  executed copies of any powers of
attorney, and copies of any document that creates, in the manner provided by the
Partnership  Agreement or these  Partnership  Regulations,  classes or groups of
Partners;

                  (d) Correct and  complete  books and records of account of the
Company; and

                  (e) Any other books,  records or documents required by the Act
or other applicable law.

         VII.7 Returns and Other  Elections.  The Board of Directors shall cause
the preparation and timely filing of all tax returns required to be filed by the
Company  pursuant to the Code and all other tax  returns  deemed  necessary  and
required in each jurisdiction in which the Company does business. Copies of such
returns, or pertinent information therefrom,  shall be furnished to the Partners
within a  reasonable  time  after  the end of each  Fiscal  Year of the  Company
considering  any  extensions  of time for filing  that may be  obtained by or on
behalf of the Company.  All elections  permitted to be made by the Company under
federal or state laws shall be made by an officer of the Company  authorized  to
do so by the Board of Directors.

                                  ARTICLE VIII
                                 TRANSFERABILITY

         VIII.1   Restrictions on Transfer of Interests in the Company.

                  (a) A Partner shall not attempt to transfer nor make or suffer
any Disposition of all or any part of his Units,  except in accordance with this
Article VIII.

                  (b) Notwithstanding anything to the contrary contained herein,
unless all of the Partners  shall consent in writing or unless such  Disposition
constitutes a Permitted  Disposition  under Section 1.1(p)(i) or (ii) hereof, no
Partner shall make or suffer any Disposition of all or any portion of his or her
Units to any person other than a Permitted Transferee, as hereinafter defined. A
Partner shall be entitled to sell,  transfer or assign all or any portion of his
or her Units to one or more Permitted  Transferees without obtaining the consent
of any other Partner. For purposes of these Partnership Regulations,  "Permitted
Transferee"  means and includes (i) an individual  who is already a Partner,  or
(ii) an individual who is a child of a Partner.

                  (c) The  Partners  agree that the holding and  disposition  of
their  respective  Units shall be subject to and  governed by all  existing  and
effective  agreements in effect  immediately prior to the Conversion,  with such
agreements  being  applied to the Units with the same effect as such  agreements
were  applicable to the  outstanding  shares of capital stock of the Predecessor
Entity.

         VIII.2   Assignees.

                  (a) The  Company  shall  not  recognize  for any  purpose  any
purported  sale,  assignment  or  transfer  of all or any portion of a Partner's
Units  unless the  assigning  Partner  complies  with all of the  provisions  of
Article  VIII,  all costs of such  assignment  have  been paid by the  assigning
Partner and there is filed with the Company a written and dated  notification of
such  sale,   assignment  or  transfer,   in  satisfactory  form,  executed  and
acknowledged  by both the seller,  assignor  or  transferor  and the  purchaser,
assignee or transferee and such  notification  (i) contains the agreement by the
purchaser, assignee or transferee to be bound by all the terms and provisions of
these Partnership  Regulations and (ii) represents that such sale, assignment or
transfer  was  made in  accordance  with all  applicable  securities  laws,  the
Partnership Agreement and these Partnership  Regulations  (including suitability
standards) and Section 8.1(b) hereof. Any sale,  assignment or transfer shall be
recognized  by the  Company  as  effective  on  the  date  of  receipt  of  such
notification by the Company.

                  (b) Unless an assignee  becomes a Partner in  accordance  with
the  provisions  set forth below,  such assignee shall not be entitled to any of
the  rights  granted  to a Partner  hereunder,  other  than the right to receive
allocations  of income,  gain,  loss,  deduction,  credit and similar  items and
distributions to which the assignor would otherwise be entitled.

                  (c) Any Partner  who  assigns  all his or her  interest in the
Company shall cease to be a Partner, except that, unless and until a substituted
Partner has been admitted into the Company,  such assigning Partner shall retain
the statutory rights of an assignor of a Partner's interest under the Act.

                  (d) A person who is the assignee of all or any fraction of the
interest of a Partner, but does not become a substituted Partner, and desires to
make a  further  assignment  of  such  interest,  shall  be  subject  to all the
provisions  of this  Article  and  Article IX to the same extent and in the same
manner as any Partner desiring to make an assignment of his or her interest.

         VIII.3   Substituted and Additional Partners.

                  (a) With the written  consent of all  Partners,  each  Partner
shall have the right to  substitute  in his or her place a purchaser,  assignee,
transferee,  donee,  heir, legatee or other recipient (a "Transferee") of all or
any portion of the Units held by such Partner,  provided that such substitution,
and  admittance to the Company as a substituted  Partner,  shall be effective at
such time as the Transferee satisfies the conditions set forth in Section 8.2(a)
hereof.

                  (b) Any person may, subject to the terms and conditions of the
Partnership  Agreement and these Partnership  Regulations,  become an additional
Partner  in the  Company  by the  issuance  by the  Company  of new Units in the
Company for such  consideration and upon such terms as the Partners,  by written
consent  of all of  the  Partners,  shall  determine.  In  order  to  become  an
additional Partner, a person shall be required to enter into a written agreement
with the  Company in which  such  person (i) agrees to be bound by all the terms
and provisions of the Partnership  Agreement and these Partnership  Regulations,
and (ii) agrees to the capital contribution(s) to be made to the Company by such
person  and such  other  terms  and  conditions  as shall be  determined  by the
Company.

                  (c) No person shall become a substituted or additional Partner
until such person has satisfied the requirements of this Article VIII; provided,
however, that for the purpose of allocating Profits, Losses and distributions, a
person shall be treated as having become, and as appearing in the records of the
Company as, a Partner, as the case may be, on such date as the sale,  assignment
or transfer of Units to such person was  recognized  by the Company  pursuant to
Section 8.2.

         VIII.4 Continuing  Liability of Partners.  No assignment or transfer of
an interest in the Company as provided  herein,  shall  relieve the assigning or
transferring  Partner from any personal liability for outstanding  indebtedness,
liabilities,  liens and  obligations  relating to the  Company or the  Company's
assets which may exist and for which such Partner has any  liability on the date
of such assignment or transfer.

                                   ARTICLE IX
                           DISSOLUTION AND TERMINATION

         IX.1     Dissolution.

                  (a) The  Company  shall  be  dissolved  upon the  election  to
dissolve the Company by a Majority in Interest of the Partners.

                  (b) Upon dissolution of the Company,  the business and affairs
of the  Company  shall  terminate,  and  the  assets  of the  Company  shall  be
liquidated under this Article IX.

                  (c)  Dissolution  of the Company  shall be effective as of the
day on which the event occurs  giving rise to the  dissolution,  but the Company
shall not terminate until there has been a winding up of the Company's  business
and affairs,  and the assets of the Company have been distributed as provided in
Section 9.2.

                  (d) Upon  dissolution  of the Company,  the Board of Directors
may cause any part or all of the assets of the Company to be sold in such manner
as the Board of Directors shall determine in an effort to obtain the best prices
for such assets;  provided,  however, that the Board of Directors may distribute
assets of the Company in kind to the Partners to the extent practicable.

                  (e) The Company shall not dissolve  upon the death,  insanity,
retirement, resignation,  withdrawal, expulsion, bankruptcy, legal incapacity or
dissolution  of  any  Partner,  or  the  occurrence  of any  other  event  which
terminates the continued status of any Partner as a partner in the Partnership.

         IX.2  Distribution  of Assets Upon  Dissolution.  In settling  accounts
after  dissolution,  the assets of the  Company  shall be paid in the  following
order:

                  (a) First, to creditors,  in the order of priority as provided
by law,  except  those to Partners  of the  Company on account of their  Capital
Contributions; and

                  (b) Second,  to the Partners in respect of their  interests in
capital and accumulated  earnings,  by making  distributions  to the Partners or
their assignees in proportion to the issued and outstanding Units.

                                    ARTICLE X
                              MEETINGS OF PARTNERS

         X.1 Place and Manner of Meetings. All meetings of the Partners shall be
held at the  principal  office of the Company or at such other  place  within or
without the State of Texas as may be determined by a Majority in Interest of the
Partners  and set forth in the  respective  notice or  waivers of notice of such
meeting.  Partners  may  participate  in such  meetings  by means of  conference
telephone  and similar  communications  equipment  by means of which all Persons
participating in the meeting can hear each other, and participation in a meeting
as provided herein shall constitute waiver of notice of the same and presence in
person at such meeting,  except where a Person  participates  in the meeting for
the express  purpose of  objecting  to the  transaction  of any  business on the
ground that the meeting is not lawfully called or convened.

         X.2 Special Meetings of Partners.  Special meetings of the Partners may
be  called  by the  holders  of not less than  twenty  percent  (20%) of all the
Partnership  Interests.  Business  transacted at all special  meetings  shall be
confined to the purpose stated in the notice;  provided  however that the notice
of special  meetings may state that the meeting may consider the  transaction of
such other business as may properly come before the meeting.

         X.3 Notice of Meetings of Partners.  Written or printed  notice stating
the place, day and hour of the meeting and, in the case of special meetings, the
purpose or purposes for which the meeting is called, shall be delivered not less
than ten (10) nor more than  sixty  (60) days  before  the date of the  meeting,
either  personally or by mail, by or at the discretion of the Person calling the
meeting, to each Partner of record entitled to vote at such meeting.

         X.4  Quorum.  A  Majority  in  Interest  of the  Partners  present at a
meeting, in person or by proxy, shall constitute a quorum at all meetings of the
Partners, except as otherwise provided by law or the Partnership Agreement. Once
a quorum is present at the meeting of the Partners,  the  subsequent  withdrawal
from the  meeting of any  Partner  prior to  adjournment  or the  refusal of any
Partner to vote shall not affect the  presence of a quorum at the  meeting.  If,
however,  such quorum shall not be present at any meeting of the  Partners,  the
Partners  entitled to vote at such  meeting  shall have the power to adjourn the
meeting  from  time to time,  without  notice  other  than  announcement  at the
meeting,  until the holders of the  requisite  amount of  Partnership  Interests
shall be present or  represented.  At any  meeting  of the  Partners  at which a
quorum is present,  the vote of the holders of a Majority in Interest of all the
Partners  present,  in  person or by  proxy,  shall be the act of the  Partners,
unless  the  vote of a  greater  number  is  required  by law,  the  Partnership
Agreement or these Partnership  Regulations.  Any vote may be taken viva voce or
by show of hands unless someone entitled to vote objects,  in which case written
ballots shall be used.

         X.5  Registered  Partners.  The Company  shall be entitled to treat the
holder of record of any Partnership  Interest as the holder of such  Partnership
Interest for all purposes,  and accordingly  shall not be bound to recognize any
equitable or other claim to or interest in such Partnership Interest on the part
of any other  Person,  whether or not it shall have  express or other  notice of
such  claim  or  interest,  except  as  expressly  provided  by the  Partnership
Agreement, these Partnership Regulations or the laws of Texas.

         X.6 Proxies.  A Partner may vote either in person or by proxy  executed
in writing by the Partner. A telegram, telex, cablegram, or similar transmission
by  the  Partner,  or  a  photographic,   photostatic,   facsimile,  or  similar
reproduction  of a writing  executed by the  Partner  shall be treated as having
been executed in writing for purposes of this Section.

         X.7 Conduct of Meetings. All meetings of the Partners shall be presided
over by the  chairman of the  meeting,  who shall be a Partner  designated  by a
Majority in Interest of the  Partners.  The  chairman of any meeting of Partners
shall  determine  the  order  of  business  and the  procedure  at the  meeting,
including such  regulation of the manner of voting and the conduct of discussion
as seem in order to him or her.

         X.8 Fixing Record Dates for Matters Other than Consents to Actions. The
Partners  may fix in  advance  a record  date  for the  purpose  of  determining
Partners  entitled to notice of or to vote at a meeting of the  Partners  (other
than determining  Partners entitled to consent to action by Partners proposed to
be taken without a meeting of Partners), the record date to be not less than ten
(10) nor more than sixty (60) days prior to said meeting.  In the absence of any
action by the Partners,  the date upon which the notice of the meeting is mailed
shall be the record date.

         X.9 Fixed  Record  Dates for  Consents to Action.  Unless a record date
shall have previously  been fixed or determined  pursuant to Section 5.9 hereof,
whenever  action by  Partners  is  proposed  to be taken by  consent  in writing
without a meeting of Partners, if provided for by these Partnership Regulations,
the Partners may fix a record date for purposes of determining Partners entitled
to consent to that action, which record date shall not precede, and shall not be
more than ten (10) days  after,  the date upon which the  resolution  fixing the
record date as adopted by the Partners.  If no record date has been fixed by the
Partners  and the prior  action by the  Partners is not required by the Act, the
record date for  determining  Partners  entitled to consent to action in writing
without a  meeting  shall be the first  date on which a signed  written  consent
setting  forth the action  taken or  proposed  to be taken is  delivered  to the
Company by delivery to its registered  office,  its principal place of business,
or a Partner of the Company having custody of the books in which  proceedings of
meetings of Partners are recorded.  Delivery shall be by hand or by certified or
registered mail, return receipt requested.  Delivery to the Company's  principal
place of business shall be addressed to any Partner of the Company. If no record
date has been fixed by the Partners and prior action of the Partners is required
by statute,  the record  date for  determining  Partners  entitled to consent to
action in writing  without a meeting  shall be at the close of  business  on the
date on which the Partners adopt a resolution taking such prior action.

         X.10 Actions  Without a Meeting.  Any action  required by the Act to be
taken at a  meeting  of the  Partners,  or any  action  which  may be taken at a
meeting of the Partners,  may be taken without a meeting,  without prior notice,
and  without a vote,  if a consent or consents  in  writing,  setting  forth the
actions  setting  forth the  action so taken,  shall be signed by the  holder or
holders of  Partnership  Interests  having not less than the minimum  percentage
share of Partnership  Interests that would be necessary to take such action at a
meeting at which the holders of all of Partnership Interests entitled to vote on
the action  were  present  and voted.  Every  written  consent  pursuant to this
Section shall be signed,  dated,  and  delivered in the manner  required by, and
shall become effective at the time and remain effective for the period specified
by, the Act. A telegram, telex, cablegram, or similar transmission by a Partner,
or a photographic,  photostatic, facsimile, or similar reproduction of a writing
signed by a Partner  shall be regarded as signed by the Partner for  purposes of
this Section.  Prompt  notice of the taking of any action by Partners  without a
meeting by less than unanimous  written consent shall be given to those Partners
who do not consent in writing to the action.

         X.11 Nature of Partnership Interest. A Partnership Interest is personal
property. A Partner shall have no interest in specific property of the Company.

                                   ARTICLE XI
                            MISCELLANEOUS PROVISIONS

        XI.1 Notices. Any notice, demand or communication  required or permitted
to be given by any provision of the Partnership  Agreement or these  Partnership
Regulations  shall be deemed to have been  sufficiently  given or served for all
purposes if delivered  personally  to the party or to an officer of the party to
whom the same is directed or, if sent by registered or certified  mail,  postage
and charges prepaid,  addressed to the Partner's and/or Company's  address as it
appears in the Company's records,  as appropriate.  Except as otherwise provided
herein,  any such notice shall be deemed to be given three  business  days after
the date on which the same was  deposited in a regularly  maintained  receptacle
for the deposit of United States mail, addressed and sent as aforesaid.

        XI.2 Waiver of Notice.  Whenever,  by statute, the Partnership Agreement
or these Partnership Regulations, notice is required to be given to any Partner,
a waiver  thereof in writing  signed by the Person or Persons  entitled  to such
notice,  whether  before  or after  the time  stated  in such  notice,  shall be
equivalent  to the giving of such notice.  Attendance  of a Partner at a meeting
shall  constitute  a waiver of notice of such  meeting,  except  where a Partner
attends the meeting for the express  purpose of objecting to the  transaction of
any business on the ground that the meeting is not lawfully called or convened.

        XI.3  Application  of Texas Law.  The  Partnership  Agreement  and these
Partnership  Regulations and the application or interpretation  hereof, shall be
governed  exclusively by the laws of the State of Texas,  and  specifically  the
Act,  provided  that the  provisions  of the  Partnership  Agreement  and  these
Partnership  Regulations  shall override the provisions of the Act to the extent
allowed by law.

        XI.4  No  Action  for  Partition.  No  Partner  shall  have any right to
maintain any action for partition with respect to the property of the Company.

        XI.5   Headings  and  Sections.   The  headings  in  these   Partnership
Regulations  are  inserted  for  convenience  only and are in no way intended to
describe,  interpret,  define,  or limit  the  scope,  extent or intent of these
Partnership  Regulations or any provision  hereof.  Unless the context  requires
otherwise,  all  references  in these  Partnership  Regulations  to  Sections or
Articles  shall be deemed to mean and refer to  Sections  or  Articles  of these
Partnership Regulations.

        XI.6 Amendment of  Partnership  Agreement and  Partnership  Regulations.
These Partnership  Regulations amend the Partnership  Agreement.  In case of any
conflict between the provisions of the Partnership  Agreement and the provisions
of  these   Partnership   Regulations,   the  provisions  of  these  Partnership
Regulations  shall  control.  Except as otherwise  expressly  set forth in these
Partnership  Regulations,  the  Partnership  Agreement  of the Company and these
Partnership  Regulations may be amended,  supplemented or restated only upon the
written  approval of a majority of the  Partners,  or in the  alternative,  upon
written  approval  by a  majority  of the  members  of the  Board of  Directors.
Notwithstanding  the foregoing,  any amendment to the  Partnership  Agreement or
these Partnership Regulations which either (i) changes the allocation of Profits
and  Losses  to  an  allocation   that  is  not  in  proportion  to  Unitholding
Percentages,  or (ii) causes any Partner to be  personally  liable for the debts
and/or  obligations of the Partnership shall require the written consent of each
affected Partner.

        XI.7  Registered  Limited  Liability  Partnership.  The  Partnership has
registered as a registered  limited  liability  partnership  pursuant to Section
3.08 of the Act. The officers and directors of the  Partnership  shall cause the
Partnership  to make such filings,  pay such filing fees and otherwise  take any
other  reasonable  measures as necessary or appropriate to maintain and continue
the status of the Partnership as a registered limited liability partnership.

        XI.8  Resignation.  Any  officer or agent of the  Company  may resign by
giving  written  notice to any remaining  Partner.  The  resignation  shall take
effect at the time specified therein.  Unless otherwise  specified therein,  the
acceptance of such resignation shall not be necessary to make it effective.

        XI.9 Numbers and Gender.  Where the context so indicates,  the masculine
shall  include  feminine and neuter,  and the neuter shall include the masculine
and feminine, the singular shall include the plural.

        XI.10  Binding  Effect.  Except  as  herein  otherwise  provided  to the
contrary,  these Partnership  Regulations shall be binding upon and inure to the
benefit of the  Partners,  their  distributees,  heirs,  legal  representatives,
executors, administrators, successors and permitted assigns.

        XI.11  Counterparts.  These  Partnership  Regulations may be executed in
multiple counterparts,  each of which shall be deemed to be an original, but all
of such counterparts shall constitute the same Partnership Regulations.

        These Partnership  Regulations were duly adopted by written agreement of
the Partners to be effective from and after December 31, 1998.

_______________                                      ____________________
Victoria Smith                                       Charlie A. Meador

Date Signed:                                         Date Signed:

_______________                                      ____________________
Stephen Smith                                        Charlie E. Meador

Date Signed:                                         Date Signed:

_______________                                      ____________________
Deanna R. Smith                                      Blake A. Meador

Date Signed:                                         Date Signed:

<PAGE>

                      Attachment to Partnership Regulations
                          of Don's Building Supply LLP

                                   SCHEDULE A

                              NAMES AND UNITS OWNED
                                 OF THE PARTNERS

-------------------------------------- -------------------- ------------------

                  Name                      Units Owned
-------------------------------------- -------------------- ------------------
        Deanna R. Smith                         2
-------------------------------------- -------------------- ------------------
        Stephen and Victoria Smith            48
-------------------------------------- -------------------- ------------------
        Charlie E. Meador                       2
-------------------------------------- -------------------- ------------------
        Blake A. Meador                         2
-------------------------------------- -------------------- ------------------
        Charlie A. Meador                     66
-------------------------------------- -------------------- ------------------
        TOTAL                                120
-------------------------------------- -------------------- ------------------

-------------------------------------- -------------------- ------------------

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00006-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00006-of-00352.parquet"}]]