Document:

PURCHASE AND SALE AGREEMENT

                          Dated as of November 29, 1999

                                      among

                        THE ORIGINATORS NAMED HEREIN,

                             IMO INDUSTRIES INC.

                                       and

                            IMO FUNDING COMPANY, LLC

                                TABLE OF CONTENTS

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                                                                            PAGE

                   ARTICLE IAGREEMENT TO PURCHASE AND SELL
1.1.  Agreement to Purchase and Sell      2
1.2.  Timing of Purchases     2
1.3.  Consideration for Purchases   3
1.4.  Purchase and Sale Termination Date  3
1.5.  Intention of the Parties      3

                   ARTICLE IICALCULATION OF PURCHASE PRICE
2.1.  Calculation of Purchase Price 3

                      ARTICLE IIIPAYMENT OF PURCHASE PRICE

3.1.  Initial Purchase Price Payment      4
3.2.  Subsequent Purchase Price Payments  4
3.3.  Settlement as to Specific Receivables     5
3.4.  Reconveyance of Receivables   6

                        ARTICLE IVCONDITIONS OF PURCHASES

4.1.  Conditions Precedent to Initial Purchase  6
4.2.  Certification as to Representations and Warranties    8
4.3.  Addition of Originators.      8

          ARTICLE VREPRESENTATIONS AND WARRANTIES OF THE ORIGINATORS
5.1.  Organization and Good Standing      9
5.2.  Due Qualification 9
5.3.  Power and Authority; Due Authorization    9
5.4.  Valid Sale; Binding Obligations     9
5.5.  No Violation      9
5.6.  Proceedings 9
5.7.  Bulk Sales Act    10
5.8.  Government Approvals    10
5.9.  Financial Condition     10
5.10. Margin Regulations      10
5.11. Quality of Title  10
5.12. Accuracy of Information 11
5.13. Offices     11
5.14. Trade Names 11
5.15. Taxes 11
5.16. Licenses and Labor Controversies    11
5.17. Compliance with Applicable Laws     12
5.18. Reliance on Separate Legal Identity 12
5.19. Purchase Price    12
5.20. Certain Definitions     12

                    ARTICLE VICOVENANTS OF THE ORIGINATORS
6.1.  Affirmative Covenants   14
6.2.  Reporting Requirements  16
6.3.  Negative Covenants      16

  ARTICLE VIIADDITIONAL RIGHTS AND OBLIGATIONS INRESPECT OF THE RECEIVABLES
7.1.  Rights of the Company   17
7.2.  Responsibilities of The Originator  17
7.3.  Further Action Evidencing Purchases 18
7.4.  Application of Collections    18

               ARTICLE VIIIPURCHASE AND SALE TERMINATION EVENTS
8.1.  Purchase and Sale Termination Events      19
8.2.  Remedies    20

                            ARTICLE IXINDEMNIFICATION

9.1.  Indemnities by the Originator 20

                             ARTICLE XMISCELLANEOUS

10.1. Amendments, etc   22
10.2. Notices, etc      22
10.3. No Waiver; Cumulative Remedies      22
10.4. Binding Effect; Assignability 22
10.5. Governing Law     23
10.6. Costs, Expenses and Taxes     23
10.7. Submission to Jurisdiction    23
10.8. Waiver of Jury Trial    24
10.9. Captions and Cross References; Incorporation by Reference   24
10.10.      Execution in Counterparts     24
10.11.      Acknowledgment and Agreement  24
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                                    SCHEDULES

SCHEDULE 5.13     Office Locations
SCHEDULE 5.14     Trade Names

                                    EXHIBITS

EXHIBIT A         Form of Purchase Report
EXHIBIT B         Form of Company Note

EXHIBIT C         Form of Opinion of Originators' Counsel
EXHIBIT D         Form of Joinder Agreement
EXHIBIT E         Form of Originator Assignment Certificate
                           PURCHASE AND SALE AGREEMENT

      THIS  PURCHASE AND SALE  AGREEMENT (as amended,  supplemented  or modified
from time to time,  this  "Agreement"),  dated as of November 29, 1999, is among
IMO INDUSTRIES  INC., a Delaware  corporation  ("IMO"),  individually and as the
initial Servicer, WARREN PUMPS INC. ("Warren"), a Delaware corporation, (IMO and
Warren   collectively   referred  to  herein  as  the   "Originators"  and  each
individually  as an  "Originator"),  and IMO  FUNDING  COMPANY,  LLC, a Delaware
limited liability company (the "Company"), as purchaser.

                                   Definitions

      Unless  otherwise  indicated,  certain terms that are capitalized and used
throughout this Agreement are defined in Exhibit I to the  Receivables  Purchase
Agreement of even date herewith (as amended,  supplemented or otherwise modified
from time to time, the "Receivables Purchase Agreement"),  among the Company, as
Seller, IMO, as Servicer,  LIBERTY STREET FUNDING CORP. (the "Issuer"),  and THE
BANK OF NOVA SCOTIA, as Administrator (together with its successors and assigns,
the "Administrator").

                                   Background

      1.    The Company is a special purpose limited  liability  company,  all
of the membership interests of which are owned by IMO.

      2. In order to finance their respective  businesses,  the Originators wish
to sell certain Receivables and Related Rights from time to time to the Company,
and the Company is willing, on the terms and subject to the conditions set forth
herein, to purchase such Receivables and Related Rights from such Originators.

      3. The Company intends to sell, assign and transfer to Issuer,  all of its
right,  title and interest in and to all of the  Receivables  and Related Rights
pursuant to the Receivables Purchase Agreement in order to finance its purchases
of certain Receivables and Related Rights hereunder.

      NOW, THEREFORE, in consideration of the premises and the mutual agreements
herein contained, the parties hereto agree as follows:

I.                                    ARTICLE

                         AGREEMENT TO PURCHASE AND SELL

A.  Agreement to Purchase and Sell.  On the terms and subject to the  conditions
set forth in this Agreement  (including Article IV), and in consideration of the
Purchase Price, each Originator  agrees to sell to the Company,  and does hereby
sell to the Company,  and the Company  agrees to purchase from such  Originator,
and does hereby  purchase  from such  Originator,  without  recourse and without
regard to collectibility,  all of such Originator's right, title and interest in
and to:

1.                each  Receivable  of such  Originator  that  existed and was
owing to such  Originator  as of the close of such  Originator's  business  on
November 30, 1999 (the "Closing Date");

1.                each  Receivable  created or originated  by such  Originator
from the  close  of such  Originator's  business  on the  Closing  Date to and
including the Purchase and Sale Termination Date;

1.                all rights to, but not the  obligations  under,  all Related
Security;

1.                all monies  due or to become due with  respect to any of the
foregoing;

1.                all books and records related to any of the foregoing; and

1. all proceeds  thereof (as defined in the applicable UCC) received on or after
the date  hereof  including,  without  limitation,  all funds  which  either are
received by such  Originator,  the Company or the Servicer  from or on behalf of
the  Obligors in payment of any amounts  owed  (including,  without  limitation,
finance charges,  interest and all other charges) in respect of Receivables,  or
are applied to such amounts owed by the Obligors (including, without limitation,
insurance payments,  if any, that such Originator or the Servicer (if other than
such Originator)  applies in the ordinary course of its business to amounts owed
in respect of any Receivable).

All  purchases  hereunder  shall be made  without  recourse,  but  shall be made
pursuant to and in reliance upon the  representations,  warranties and covenants
of each  Originator  set  forth in this  Agreement  and each  other  Transaction
Document.  The Company's  foregoing  commitment to purchase such Receivables and
the proceeds and rights described in subsections (c) through (f) of this Section
1.1  (collectively,  the  "Related  Rights")  is  herein  called  the  "Purchase
Facility."

A.                Timing of Purchases.

1. Closing Date Purchases. Each Originator's entire right, title and interest in
(i) each  Receivable  that  existed and was owing to such  Originator  as of the
close of such  Originator's  business on the Closing Date,  and (ii) all Related
Rights with respect  thereto shall be deemed to have been sold to the Company on
the Closing Date.

1.                Regular  Purchases.  After the Closing Date, each Receivable
created or  originated  by each  Originator  and  described in Section  1.1(b)
hereof and all  Related  Rights  shall be  purchased  and owned by the Company
(without  any  further  action)  upon  the  creation  or  origination  of such
Receivable.

A.                Consideration  for  Purchases.  On the terms and  subject to
the  conditions  set forth in this  Agreement,  the Company agrees to make all
Purchase  Price  payments to the respective  Originators,  in accordance  with
Article III.

A. Purchase and Sale Termination  Date. The "Purchase and Sale Termination Date"
shall  be the  earlier  to  occur  of (a) the  date of the  termination  of this
Agreement pursuant to Section 8.2 and (b) the Payment Date immediately following
the day on which IMO shall have given notice to the Company that the Originators
desire to terminate this Agreement.

      As used  herein,  "Payment  Date" means (i) the Closing Date and (ii) each
Business Day thereafter that the Originators are open for business.

A. Intention of the Parties. It is the express intent of the parties hereto that
the transfers of the  Receivables  and Related Rights by each  Originator to the
Company,  as contemplated by this Agreement be, and be treated as, sales and not
as  loans  secured  by  the  Receivables   and  Related  Rights.   If,  however,
notwithstanding  the  intent of the  parties,  such  transfers  are deemed to be
loans,  such Originator  hereby grants  (effective as of the date hereof) to the
Company a first priority security  interest in all of such  Originator's  right,
title and interest in and to the Receivables and the Related Rights now existing
and hereafter created,  all monies due or to become due and all amounts received
with  respect  thereto,  and  all  proceeds  thereof,  to  secure  all  of  such
Originator's obligations hereunder.

I.                                    ARTICLE

                          CALCULATION OF PURCHASE PRICE

A.  Calculation of Purchase Price. Not later than ten days after the last day of
each Reporting Period (the "Servicer  Report Date"),  the Servicer shall deliver
to the Company,  the Administrator and each Originator a report in substantially
the form of Exhibit A (each such report being herein called a "Purchase Report")
with  respect to the matters set forth  therein and the  Company's  purchases of
Receivables from each Originator

1.                that are to be made on the Closing  Date (in the case of the
Purchase Report to be delivered on the Closing Date), or

1. that were made  during the period  commencing  on the  Servicer  Report  Date
immediately  preceding  such Servicer  Report Date to (but not  including)  such
Servicer Report Date (in the case of each subsequent Purchase Report).

The "Purchase Price" (to be paid to each Originator in accordance with the terms
of Article III) for the  Receivables  and the Related  Rights that are purchased
hereunder shall be determined in accordance with the following formula:

      PP    =     OB X FMVD

      where:

      PP          = Purchase  Price for each  Receivable  as  calculated  on the
                  relevant Payment Date.

                  OB    =     the Outstanding Balance of such Receivable.

                  FMVD  = Fair  Market  Value  Discount,  as  measured  on  such
                        Payment Date, which is equal to the quotient  (expressed
                        as  percentage) of (a) one divided by (b) the sum of (i)
                        one,  plus (ii) the  product  of (A) LIBOR  plus 1.5% on
                        such Payment Date, and (B) a fraction,  the numerator of
                        which is the Days' Sales  Outstanding  (calculated as of
                        the last day of the calendar  month next  preceding such
                        Payment Date) and the denominator of which is 365.

I.                                    ARTICLE

                            PAYMENT OF PURCHASE PRICE

A.                Initial  Purchase  Price  Payment.  On the terms and subject
to the  conditions set forth in this  Agreement,  the Company agrees to pay to
each  Originator the Purchase Price for the purchase of Receivables to be made
on the Closing  Date,  partially in cash in an amount agreed to by the Company
and such  Originator,  in the case of IMO partially in consideration of all of
the membership interest of the Company,  and partially by issuing a promissory
note in the form of Exhibit B to such  Originator  with an  initial  principal
balance equal to the remaining  Purchase Price (as such promissory note may be
amended,  supplemented,  indorsed  or  otherwise  modified  from time to time,
together with all  promissory  notes issued from time to time in  substitution
therefor or renewal  thereof in  accordance  with the  Transaction  Documents,
each a "Company Note").

A.                Subsequent  Purchase  Price  Payments.  On each Business Day
falling  after  the  Closing  Date and on or prior  to the  Purchase  and Sale
Termination  Date,  on the terms and  subject to the  conditions  set forth in
this  Agreement,  the Company shall pay to each  Originator the Purchase Price
for the  Receivables  sold by such  Originator to the Company on such Business
Day, in cash,  to the extent the Company has  received  funds  pursuant to the
Receivables  Purchase Agreement or otherwise has available cash (to the extent
such other  available cash may, in accordance  with the  Receivables  Purchase
Agreement,  be used to  purchase  Receivables),  and to the extent any of such
Purchase Price remains unpaid,  such remaining  portion of such Purchase Price
shall be paid by means of an automatic  increase to the outstanding  principal
amount of the Company Note issued to such Originator.

      Servicer shall make all appropriate record keeping entries with respect to
the Company Notes or otherwise to reflect the foregoing  payments and to reflect
adjustments  pursuant to Section 3.3,  and  Servicer's  books and records  shall
constitute  rebuttable  presumptive  evidence  of the  principal  amount  of and
accrued  interest on any Company Note at any time.  Furthermore,  Servicer shall
hold the Company  Notes for the  benefit of the  Originators,  and all  payments
under the  Company  Notes shall be made to the  Servicer  for the account of the
applicable payee thereof. Each Originator hereby irrevocably authorizes Servicer
to mark the Company  Notes  "CANCELLED"  and to return such Company Notes to the
Company upon the final payment  thereof after the occurrence of the Purchase and
Sale Termination Date.

A.                Settlement as to Specific Receivables and Dilution.

1. If on the day of purchase of any Receivable  from any  Originator  hereunder,
any of the representations or warranties of such Originator set forth in Section
5.4 or 5.11 is not true with  respect to such  Receivable  or as a result of any
action or inaction of such Originator, on any day any of such representations or
warranties  set forth in Section 5.4 or 5.11 is no longer  true with  respect to
such Receivable  (other than a  representation  or warranty set forth in Section
5.11(c) which is no longer true as a result of an Obligor's  payment  obligation
being stayed or discharged in bankruptcy),  then the Purchase Price with respect
to such  Receivable  shall be  reduced  by an  amount  equal to the  Outstanding
Balance of such Receivable and shall be accounted to such Originator as provided
in  subsection  (c) below;  provided,  that if the Company  thereafter  receives
payment on account  of  Collections  due with  respect to such  Receivable,  the
Company promptly shall deliver such funds to such Originator.

1. If, on any day, the Outstanding Balance of any Receivable purchased hereunder
is reduced or adjusted as a result of any defective, rejected, returned goods or
services,  or any  discount  or other  adjustment  made by any  Originator,  the
Company or the Servicer or any offset, setoff or dispute between such Originator
or the Servicer and an Obligor as indicated on the books of the Company (or, for
periods  prior to the  Closing  Date,  the books of such  Originator),  then the
Purchase Price with respect to such Receivable shall be reduced by the amount of
such net  reduction  and shall be  accounted to such  Originator  as provided in
subsection (c) below.

1. Any reduction in the Purchase Price of any Receivable  pursuant to subsection
(a) or (b) above  shall be applied as a credit  for the  account of the  Company
against the Purchase Price of Receivables  subsequently purchased by the Company
from such Originator hereunder;  provided,  however if there are no purchases of
Receivables  from  such  Originator  (or   insufficiently   large  purchases  of
Receivables)  to create a Purchase  Price  sufficient  to so apply  such  credit
against, the amount of such credit

a) shall be paid in cash to the Company by the  Originator in the manner and for
application as described in the following proviso, or b) shall be deemed to be a
payment  under,  and shall be deducted  from the  principal  amount  outstanding
under, the Company Note payable to such Originator to the extent permitted under
Section 1(m) of Exhibit IV of the Receivables Purchase Agreement;

provided,  further,  that at any time (y) when a Termination  Event or Unmatured
Termination Event exists under the Receivables  Purchase  Agreement or (z) on or
after the  Purchase  and Sale  Termination  Date,  the amount of any such credit
shall be paid by such  Originator  to the  Company  by  deposit  in  immediately
available  funds into the Collection  Account for application by Servicer to the
same extent as if Collections  of the  applicable  Receivable in such amount had
actually been received on such date.

1. Each Purchase Report (other than the Purchase Report delivered on the Closing
Date) shall include, in respect of the Receivables  previously generated by each
Originator,  a calculation of the aggregate  reductions  described in subsection
(a) or (b) relating to such Receivables since the last Purchase Report delivered
hereunder,  as indicated on the books of the Company (or, for such periods prior
to the Closing Date, the books of the Originator).

A.  Reconveyance  of  Receivables.  In the event that an Originator  has paid or
credited to the Company the full Outstanding  Balance of any Receivable pursuant
to Section 3.3, the Company shall reconvey such  Receivable to such  Originator,
without recourse and without  representation or warranty,  but free and clear of
all liens created by the Company.

I.                                    ARTICLE

                             CONDITIONS OF PURCHASES

A. Conditions  Precedent to Initial Purchase.  The initial purchase hereunder is
subject to the condition  precedent that the Company shall have received,  on or
before the Closing Date, the following,  each (unless otherwise indicated) dated
the Closing  Date,  and each in form,  substance  and date  satisfactory  to the
Company:

1.                A copy of the  resolutions of the Board of Directors of each
Originator  approving the Transaction  Documents to be delivered by it and the
transactions  contemplated  hereby and thereby,  certified by the Secretary or
Assistant Secretary of such Originator;

1. Good standing  certificates  for each  Originator  issued as of a recent date
acceptable  to Servicer by the  Secretary of State of the  jurisdiction  of such
Originator's  incorporation and the jurisdiction  where such Originator's  chief
executive office is located;

1. A  certificate  of the  Secretary or Assistant  Secretary of each  Originator
certifying  the names and true  signatures  of the officers  authorized  on such
Originator's behalf to sign the Transaction  Documents to be delivered by it (on
which  certificate  the Company and Servicer (if other than an  Originator)  may
conclusively  rely until such time as the Company and the Servicer shall receive
from such  Originator a revised  certificate  meeting the  requirements  of this
subsection (c));

1. The  articles of  incorporation  of each  Originator,  duly  certified by the
Secretary of State of the jurisdiction of such Originator's  incorporation as of
a recent date  acceptable  to Servicer,  together  with a copy of the by-laws of
such Originator,  each duly certified by the Secretary or an Assistant Secretary
of such Originator;

1. Copies of the proper  financing  statements  (Form UCC-1) that have been duly
executed and name each  Originator as the  seller/debtor  and the Company as the
purchaser/secured  party  (and  Issuer  as  assignee  of  the  Company)  of  the
Receivables  generated by such  Originator and Related Rights or other,  similar
instruments  or  documents,  as  may  be  necessary  or,  in  Servicer's  or the
Administrator's   opinion,   desirable   under   the  UCC  of  all   appropriate
jurisdictions or any comparable law of all appropriate  jurisdictions to perfect
the Company's  ownership interest in all Receivables and Related Rights in which
an ownership interest may be assigned to it hereunder;

1. A written  search  report  from a Person  satisfactory  to  Servicer  and the
Administrator   listing  all  effective  financing   statements  that  name  any
Originator  as debtor or  assignor  and that are filed in the  jurisdictions  in
which filings were made pursuant to the foregoing  subsection (e), together with
copies of such financing  statements (none of which,  except for those described
in the  foregoing  subsection  (e),  shall cover any  Receivable  or any Related
Right),  and tax and judgment lien search reports from a Person  satisfactory to
Servicer and the  Administrator  showing no evidence of such liens filed against
any Originator;

1.                Favorable  opinions  of counsel to the  Originators,  in the
forms of Exhibit C;

1. Evidence (i) of the execution and delivery by each of the parties  thereto of
each  of the  other  Transaction  Documents  to be  executed  and  delivered  in
connection  herewith  and (ii)  that  each of the  conditions  precedent  to the
execution,  delivery and effectiveness of such other  Transaction  Documents has
been satisfied to the Company's satisfaction; and

1. A certificate  from an officer of each Originator to the effect that Servicer
and  Originator  have  placed  on the most  recent,  and have  taken  all  steps
reasonably necessary to ensure that there shall be placed on subsequent, summary
master control data processing  reports the following legend (or the substantive
equivalent  thereof):  "THE  RECEIVABLES  DESCRIBED HEREIN HAVE BEEN SOLD TO IMO
FUNDING  COMPANY,  LLC,  PURSUANT TO A PURCHASE AND SALE AGREEMENT,  DATED AS OF
NOVEMBER 29, 1999, AMONG IMO INDUSTRIES INC., THE ORIGINATORS  NAMED THEREIN AND
IMO FUNDING  COMPANY,  LLC; AND AN INTEREST IN THE RECEIVABLES  DESCRIBED HEREIN
HAS BEEN GRANTED TO LIBERTY  STREET  FUNDING  CORP.,  PURSUANT TO A  RECEIVABLES
PURCHASE  AGREEMENT,  DATED AS OF NOVEMBER 29, 1999,  AMONG IMO INDUSTRIES INC.,
IMO FUNDING  COMPANY,  LLC,  LIBERTY STREET FUNDING CORP.,  AND THE BANK OF NOVA
SCOTIA, AS ADMINISTRATOR."

A.  Certification as to  Representations  and Warranties.  Each  Originator,  by
accepting  the  Purchase  Price  related to each  purchase of  Receivables  (and
Related Rights) generated by such Originator,  shall be deemed to have certified
that the  representations  and  warranties  contained  in Article V are true and
correct on and as of such day,  with the same effect as though made on and as of
such day.

A.            Addition  of  Originators.  Additional  Persons  may be added as
Originators hereunder,  with the consent of the Company and the Administrator,
in its  reasonable  discretion,  provided  that the following  conditions  are
satisfied on or before the date of such addition:

a) IMO shall have given the  Administrator  and the Company at least thirty days
prior written notice of such proposed  addition and the identity of the proposed
additional  Originator and shall have provided such  information with respect to
the receivables of such additional  Originator as the  Administrator  shall have
reasonably requested;

a) such proposed additional Originator has executed and delivered to the Company
and the Administrator an agreement  substantially in the form attached hereto as
Exhibit D (each, a "Joinder Agreement");

a)                such  proposed  additional  Originator  has delivered to the
Company  and the  Administrator  each of the  documents  with  respect to such
Originator described in Section 4.1;

a) unless the Receivables  intended to be sold by such Originator to the Company
hereunder are Receivables,  the related  underlying goods of which, are and will
continue to be generated by an already existing  Originator,  the  Administrator
shall have  received a written  statement  from each of Moody's  and  Standard &
Poors  confirming  that the  addition  of such  Originator  will not result in a
downgrade or withdrawal of the current ratings of the Notes; and

a)                the  Purchase  and  Sale  Termination  Date  shall  not have
occurred.

I.                                    ARTICLE

              REPRESENTATIONS AND WARRANTIES OF THE ORIGINATORS

      In order to induce the  Company to enter into this  Agreement  and to make
purchases  hereunder,  each Originator,  hereby makes with respect to itself the
representations and warranties set forth in this Article V.

A.  Organization and Good Standing.  Such Originator has been duly organized and
is validly  existing as a  corporation  in good  standing  under the laws of the
state of its  incorporation,  with  corporate  power  and  authority  to own its
properties and to conduct its business as such  properties  are presently  owned
and such business is presently conducted.

A.                Due  Qualification.  Such  Originator  is duly  licensed  or
qualified  to do business  as a foreign  corporation  in good  standing in the
jurisdiction  where its chief executive office and principal place of business
are located and in all other  jurisdictions in which the ownership or lease of
its  property  or the  conduct of its  business  requires  such  licensing  or
qualification,  in either case,  except where the failure to be so licensed or
qualified could not reasonably be expected to have a Material Adverse Effect.

A. Power and Authority; Due Authorization. Such Originator has (a) all necessary
corporate  power,  authority  and legal  right (i) to execute and  deliver,  and
perform its obligations under, each Transaction Document to which it is a party,
and (ii) to generate,  own, sell,  contribute and assign Receivables and Related
Rights on the terms and subject to the conditions  herein and therein  provided;
and (b) duly authorized such execution and delivery and such sale and assignment
and the performance of such obligations by all necessary corporate action.

A.                Valid Sale; Binding  Obligations.  Each sale, of Receivables
and Related Rights made by such  Originator  pursuant to this Agreement  shall
constitute  a valid sale,  transfer,  and  assignment  thereof to the Company,
enforceable  against  creditors of, and purchasers from, such Originator;  and
this Agreement  constitutes,  and each other Transaction Document to be signed
by such  Originator,  when duly executed and  delivered,  will  constitute,  a
legal,  valid, and binding obligation of such Originator,  enforceable against
such  Originator  in  accordance  with  its  terms;  except  in  each  case as
enforceability may be limited by bankruptcy,  insolvency,  reorganization,  or
other similar laws affecting the  enforcement of creditors'  rights  generally
and  by  general   principles   of   equity,   regardless   of  whether   such
enforceability is considered in a proceeding in equity or at law.

A.                No  Violation.   The   consummation   of  the   transactions
contemplated  by this  Agreement and the other  Transaction  Documents and the
fulfillment of the terms hereof or thereof will not (a) conflict with,  result
in any breach of any of the terms and  provisions  of, or constitute  (with or
without   notice  or  lapse  of  time  or  both)  a  default  under  (i)  such
Originator's  certificate of incorporation or by-laws,  or (ii) any indenture,
loan agreement,  mortgage,  deed of trust, or other agreement or instrument to
which it is a party or by which it is bound,  (b)  result in the  creation  or
imposition  of any Adverse  Claim upon any of its  properties  pursuant to the
terms of any such  indenture,  loan  agreement,  mortgage,  deed of trust,  or
other agreement or instrument,  other than the Transaction  Documents,  or (c)
violate any law or any order,  rule,  or  regulation  applicable  to it of any
court or of any  federal,  state or foreign  regulatory  body,  administrative
agency, or other governmental  instrumentality  having jurisdiction over it or
any of its properties.

A.                Proceedings.   There   is  no   litigation   or,   to   such
Originator's  knowledge,  any proceeding or investigation,  pending before any
court,  regulatory body, arbitrator,  administrative agency, or other tribunal
or   governmental   instrumentality   (a)  asserting  the  invalidity  of  any
Transaction  Document,  (b)  seeking to prevent  the sale of  Receivables  and
Related  Rights  to the  Company  or  the  consummation  of  any of the  other
transactions  contemplated  by any  Transaction  Document,  or (c) seeking any
determination  or ruling that could  reasonably be expected to have a Material
Adverse Effect.

A.                Bulk  Sales  Act.   No   transaction   contemplated   hereby
requires compliance with any bulk sales act or similar law.

A.                Government  Approvals.  Except  for  the  filing  of the UCC
financing  statements  referred  to in Article  IV, all of which,  at the time
required in Article  IV,  shall have been duly made and shall be in full force
and effect,  no authorization or approval or other action by, and no notice to
or filing with, any governmental  authority or regulatory body is required for
such  Originator's due execution,  delivery and performance of any Transaction
Document to which it is a party, as seller.
B.                Financial Condition.

1. On the date  hereof,  and on the  date of each  sale of  Receivables  by each
Originator  to the Company  (both before and after giving  effect to such sale),
such Originator is and shall be Solvent.

1. The consolidated  balance sheets of IMO and its consolidated  subsidiaries as
of  December  31, 1998 and the related  statements  of income and  shareholders'
equity of IMO and its  consolidated  subsidiaries for the fiscal year then ended
certified by IMO's independent accountants,  copies of which have been furnished
to the Company,  present fairly the consolidated  financial  position of IMO and
its  consolidated  subsidiaries  for  the  period  ended  on such  date,  all in
accordance with generally accepted accounting  principles  consistently applied;
and since such date no event has occurred that has had, or is reasonably  likely
to have, a Material Adverse Effect.

A.                Margin  Regulations.  No use of any funds  acquired  by such
Originator  under this  Agreement  will  conflict  with or  contravene  any of
Regulations  T, U and X  promulgated  by the Board of Governors of the Federal
Reserve System from time to time.

A.                Quality of Title.

1. Each Receivable (together with the Related Rights) which is to be sold to the
Company hereunder is or shall be owned by such Originator, free and clear of any
Adverse Claim. Whenever the Company makes a purchase,  hereunder,  it shall have
acquired a valid and perfected ownership interest (free and clear of any Adverse
Claim) in all  Receivables  generated  by such  Originator  and all  Collections
related thereto,  and in such Originator's  entire right,  title and interest in
and to the other Related Rights with respect thereto.

1. No  effective  financing  statement  or other  instrument  similar  in effect
covering any Receivable generated by such Originator or any right related to any
such  Receivable is on file in any recording  office except such as may be filed
in favor of the Company or the  Originators,  as the case may be, in  accordance
with this Agreement or in favor of the Issuer in accordance with the Receivables
Purchase Agreement.

2.                Unless  otherwise  identified  to the Company in the related
Purchase  Report,  each  Receivable  purchased  hereunder  is on the  date  of
purchase an Eligible Receivable.

A. Accuracy of Information.  No factual written  information  furnished or to be
furnished  in  writing by such  Originator,  to the  Company,  the Issuer or the
Administrator for purposes of or in connection with any Transaction  Document or
any  transaction  contemplated  hereby or thereby is, and no other such  factual
written information  hereafter  furnished (and prepared) by such Originator,  to
the Company, the Issuer, or the Administrator  pursuant to or in connection with
any Transaction  Document,  taken as a whole, will be inaccurate in any material
respect as of the date it was furnished or (except as otherwise disclosed to the
Company at or prior to such time) as of the date as of which such information is
dated or  certified,  or shall  contain  any  material  misstatement  of fact or
omitted  or will  omit  to  state  any  material  fact  necessary  to make  such
information, in the light of the circumstances under which any statement therein
was made, not materially  misleading on the date as of which such information is
dated or certified.

A.                Offices.  Such Originator's  principal place of business and
chief  executive  office  is  located  at the  address  set forth  under  such
Originator's  signature  hereto,  and the offices where such Originator  keeps
all its books, records and documents  evidencing the Receivables,  the related
Contracts and all other agreements  related to such Receivables are located at
the  addresses  specified  on  Schedule  5.13  (or at  such  other  locations,
notified to the Servicer and the  Administrator  in  accordance  with Section
6.1(f),  in  jurisdictions  where all action  required by Section 7.3 has been
taken and completed).

A.                Trade Names.

1.                Except as disclosed  on  Schedule 5.14(a),  such  Originator
does not use any trade name other than its actual corporate name.

1. From and after the date that fell five (5) years before the date hereof, such
Originator has not been known by any legal name other than its corporate name as
of the date hereof,  nor has such  Originator  been the subject of any merger or
other  corporate  reorganization,  except in each case as  disclosed on Schedule
5.14(b).

A.                Taxes.  Such  Originator  has filed all material tax returns
and  reports  required  by law to have been filed by it and has paid all taxes
and governmental  charges thereby shown to be owing, except any such taxes and
charges  which are not yet  delinquent  or are being  diligently  contested in
good faith by  appropriate  proceedings  and for which  adequate  reserves  in
accordance with generally accepted  accounting  principles shall have been set
aside on its books.

A.                Licenses and Labor Controversies.

1. Such Originator has not failed to obtain any licenses, permits, franchises or
other governmental  authorizations  necessary to the ownership of its properties
or to the conduct of its business, which violation or failure to obtain would be
reasonably likely to have a Material Adverse Effect; and

1.                There  are  no  labor  controversies  pending  against  such
Originator  that  have  had (or are  reasonably  likely  to  have) a  Material
Adverse Effect.

A.  Compliance with  Applicable  Laws. Such Originator is in compliance,  in all
material  respects,  with the  requirements of (i) all applicable  laws,  rules,
regulations,  and orders of all  governmental  authorities  (including,  without
limitation,  Regulation Z, laws, rules and regulations  relating to usury, truth
in  lending,   fair  credit  billing,   fair  credit  reporting,   equal  credit
opportunity,  fair debt collection  practices and privacy and all other consumer
laws  applicable  to the  Receivables  and related  Contracts)  (excluding  with
respect to environmental  matters which are covered by clause (ii)), and (ii) to
the best of its knowledge, all applicable environmental laws, rules, regulations
and orders of all governmental authorities.

A.                Reliance on Separate  Legal  Identity.  Such  Originator  is
aware that the Issuer and the  Administrator are entering into the Transaction
Documents to which they are parties in reliance  upon the  Company's  identity
as a legal entity separate from such Originator.

A.                Purchase  Price.  The purchase  price payable by the Company
to such  Originator  hereunder  is  intended  by  such  Originator  (and  such
Originator  understands  that it is intended by the Company) to be  consistent
with the terms that would be obtained in an arm's length sale.

A.                Certain  Definitions.  With respect to this  Agreement,  the
terms "Material Adverse Effect" and "Solvent" are defined as follows:

            "Material  Adverse  Effect"  means,  with  respect  to any  event or
circumstance, a material adverse effect on:

            (i)   the  business,   assets,  or  financial   condition  of  any
      Originator and its subsidiaries, taken as a whole;

            (ii) the  ability of any  Originator  or the  Servicer  (if it is an
      Originator) to perform its respective  obligations  under the  Receivables
      Purchase  Agreement  or any other  Transaction  Document  to which it is a
      party or the performance of any such obligations;

            (iii) the validity or enforceability  of the Receivables  Purchase
      Agreement or any other Transaction Document;

            (iv)  with  respect  to  this  Agreement,  the  status,   existence,
      perfection,  priority  or  enforceability  of  Company's  interest  in the
      Receivables or Related Rights; or

            (v)   the validity or enforceability of the Receivables.

            "Solvent" means, with respect to any Person at any time, a condition
under which:

            (i) the fair value and present fair saleable  value of such Person's
      total assets is, on the date of determination,  greater than such Person's
      total liabilities  (including contingent and unliquidated  liabilities) at
      such time;

            (ii)  such  Person is and shall  continue to be able to pay all of
      its liabilities as such liabilities mature; and

            (iii) such  Person does not have  unreasonably  small  capital  with
      which to engage in its current and in its anticipated business.

For purposes of this definition:

            (A) the amount of a Person's contingent or unliquidated  liabilities
      at any time  shall be that  amount  which,  in light of all the  facts and
      circumstances then existing, represents the amount which can reasonably be
      expected to become an actual or matured liability;

            (B) the "fair  value" of an asset  shall be the amount  which may be
      realized  within a reasonable  time either  through  collection or sale of
      such asset at its regular market value;

            (C) the "regular market value" of an asset shall be the amount which
      a capable and diligent business person could obtain for such asset from an
      interested  buyer who is willing to  purchase  such asset  under  ordinary
      selling conditions; and

            (D) the "present fair  saleable  value" of an asset means the amount
      which can be obtained if such asset is sold with reasonable  promptness in
      an arm's length transaction in an existing and not theoretical market.

      5.21.  Year 2000 Problem.  Such  Originator  reasonably  believes that all
internal  computer  operations  that  are  material  to  its  and  each  of  its
Subsidiaries business operations will be able to perform properly date sensitive
functions  for all dates  before,  on and after  January 1, 2000,  except to the
extent  that a  failure  to do so could not  reasonably  be  expected  to have a
Material Adverse Effect.

I.                                    ARTICLE

                          COVENANTS OF THE ORIGINATORS

A.                Affirmative   Covenants.   From  the  date  hereof until the
first day following the Purchase and Sale  Termination  Date,  each Originator
(and IMO as to clause  (h)) will,  unless the  Company  and the  Administrator
shall otherwise consent in writing:
1.                Compliance with Laws,  Etc. Comply in all material  respects
with all applicable laws, rules,  regulations and orders, including those with
respect to the  Receivables  generated  by it and the  related  Contracts  and
other agreements related thereto.

1.  Preservation  of Corporate  Existence.  Preserve and maintain its  corporate
existence,  rights,  franchises  and  privileges  in  the  jurisdiction  of  its
incorporation,  and qualify and remain  qualified in good  standing as a foreign
corporation in each jurisdiction where the failure to preserve and maintain such
existence, rights, franchises,  privileges and qualification could reasonably be
expected to have a Material Adverse Effect.

1. Receivables Review. At any time and from time to time during regular business
hours,  upon  reasonable  prior notice  (unless a Purchase and Sale  Termination
Event or Unmatured  Purchase and Sale Termination Event shall exist), (i) permit
the  Company  and/or  the   Administrator,   or  their   respective   agents  or
representatives,  (A) to examine, to audit and make copies of and abstracts from
all books, records and documents (including, without limitation,  computer tapes
and  disks) in the power,  possession  or under the  control of such  Originator
relating to the Receivables and Related Rights,  including,  without limitation,
the  Contracts  and other  agreements  related  thereto,  and (B) to visit  such
Originator's  offices and properties for the purpose of examining such materials
described in the foregoing  clause (A) and  discussing  matters  relating to the
Receivables and Related Rights or such Originator's  performance  hereunder with
any of the  officers or employees of such  Originator  having  knowledge of such
matters; and (ii) without limiting the provisions of clause (i) next above, from
time  to  time  on  request  of  the  Administrator,   permit  certified  public
accountants  or other  auditors  acceptable  to the  Administrator  to conduct a
review of its books and  records  with  respect to the  Receivables  and Related
Rights.  Unless a Purchase and Sale Termination Event or Unmatured  Purchase and
Sale  Termination  Event shall exist,  each Originator shall only be responsible
for the cost of one examination  described in clause (i) or clause (ii) above in
any twelve-month period.

1.                Keeping  of  Records  and  Books  of  Account.  Maintain  an
ability to recreate  records  evidencing  the  Receivables in the event of the
destruction of the originals thereof.

1.  Performance  and Compliance with  Receivables and Contracts.  At its expense
timely and fully  perform and comply with all  provisions,  covenants  and other
promises required to be observed by it under the related Contracts and all other
agreements related to the Receivables and Related Rights.

1. Location of Records. Keep its principal place of business and chief executive
office,  and the  offices  where it keeps its records  concerning  or related to
Receivables and Related Rights,  at the address(es)  referred to in Section 5.13
or, upon 30 days' prior written notice to the Company and the Administrator,  at
such other locations in  jurisdictions  where all action required by Section 7.3
shall have been taken and completed.

1.                Credit  and  Collection  Policies.  Comply  in all  material
respects  with  its  Credit  and  Collection  Policy  in  connection  with the
Receivables and the related Contracts.
2.                Separate  Corporate  Existence  of the  Company.  Take  such
actions as shall be required in order that:

a) the Company's  operating expenses (other than certain  organization  expenses
and  expenses  incurred in  connection  with the  preparation,  negotiation  and
delivery  of the  Transaction  Documents)  will  not be  paid  by IMO  and  such
Originator;

a)                the   Company's   books  and  records  will  be   maintained
separately from those of IMO and such Originator;

a) all financial  statements of IMO and such Originator that are consolidated to
include the Company will contain  detailed notes clearly stating that (A) all of
the Company's assets are owned by the Company, and (B) the Company is a separate
entity with creditors who have received interests in the Company's assets;

a)                IMO and such  Originator  will  strictly  observe  corporate
formalities in its dealing with the Company;

a) Except  as  otherwise  provided  in the  Receivables  Purchase  Agreement  in
connection with the servicing of Receivables,  IMO and such Originator shall not
commingle its funds with any funds of the Company;

a) IMO and such  Originator  will maintain arm's length  relationships  with the
Company, and IMO and such Originator will be compensated at market rates for any
services it renders or otherwise furnishes to the Company; and

a) IMO and such  Originator  will not be,  and will not hold  itself  out to be,
responsible  for the debts of the Company or the decisions or actions in respect
of the daily business and affairs of the Company.

1. Post  Office  Boxes.  Within 30 days  after the date  hereof,  deliver to the
Administrator a certificate from an authorized officer of such Originator to the
effect  that (i) the name of the  renter of all post  office  boxes  into  which
Collections may from time to time be mailed have been changed to the name of the
Company (unless such post office boxes are in the name of the relevant  Lock-Box
Banks) and (ii) all relevant  postmasters  have been  notified  that each of the
Servicer and the  Administrator are authorized to collect mail delivered to such
post office boxes (unless such post office boxes are in the name of the relevant
Lock-Box Bank).

A.                Reporting  Requirements.  From the  date  hereof  until  the
first day following the Purchase and Sale  Termination  Date,  each Originator
shall,  unless the  Administrator  and the Company shall otherwise  consent in
writing, furnish to the Company and the Administrator:

1. Proceedings.  Promptly after such Originator has knowledge  thereof,  written
notice to the Company and the  Administrator of (i) all pending  proceedings and
investigations of the type described in Section 5.6 not previously  disclosed to
the Company and/or the Administrator and (ii) all material adverse  developments
that have  occurred with respect to any  previously  disclosed  proceedings  and
investigations.

1.  Other.  Promptly,  from time to time,  such  other  information,  documents,
records  or reports  respecting  the  Receivables,  the  Related  Rights or such
Originator's  performance  hereunder that the Company or the  Administrator  may
from time to time  reasonably  request in order to protect the  interests of the
Company,  the Issuer, the Administrator or any other Affected Person under or as
contemplated by the Transaction Documents.

A.                Negative  Covenants.  From the date  hereof  until  the date
following  the Purchase and Sale  Termination  Date,  each  Originator  agrees
that,  unless the  Administrator  and the Company shall  otherwise  consent in
writing (which consent shall not be unreasonably withheld), it shall not:

1.  Sales,  Liens,  Etc.  Except as  otherwise  provided  herein or in any other
Transaction  Document,  sell,  assign  (by  operation  of law or  otherwise)  or
otherwise  dispose  of, or create or suffer to exist any  Adverse  Claim upon or
with respect to, any  Receivable  or related  Contract,  Collections  or Related
Security,  or any  interest  therein,  or assign any right to receive  income in
respect thereof.

1.  Extension  or  Amendment of  Receivables.  Except as otherwise  permitted in
Section 4.2(a) of the Receivables  Purchase  Agreement or in accordance with the
Credit and Collection Policy, extend, amend or otherwise modify the terms of any
Receivable in any material respect,  or amend,  modify or waive, in any material
respect,  any term or condition of any Contract  related  thereto (which term or
condition relates to payments under, or the enforcement of, such Contract).

1. Change in Business or Credit and  Collection  Policy.  Make any change in the
character of its business or materially alter its Credit and Collection  Policy,
which  change  would,  in either  case,  materially  change the credit  standing
required of particular Obligors or potential Obligors or impair, in any material
respect, the collectibility of the Receivables generated by it.

1.  Receivables Not to be Evidenced by Promissory  Notes or Chattel Paper.  Take
any action to cause or permit any Receivable generated by it to become evidenced
by any "instrument" or "chattel paper" (as defined in the applicable UCC) unless
such "instrument" or "chattel paper" shall be delivered to the Company (which in
turn shall deliver the same to the Issuer (or the Administrator on its behalf)).

1. Mergers,  Acquisitions,  Sales, etc. Merge or consolidate with another Person
(except  pursuant to a merger or  consolidation  involving such Originator where
such Originator is the surviving  corporation),  or convey,  transfer,  lease or
otherwise  dispose of  (whether in one or in a series of  transactions),  all or
substantially all of its assets (whether now owned or hereafter acquired), other
than pursuant to this Agreement.

1. Lock-Box Banks. Make any changes in its instructions to any Obligor regarding
Collections  or add or terminate  any Lock-Box Bank unless the  requirements  of
Section 1(i) of Exhibit IV to the Receivables Purchase Agreement have been met.

1.                Accounting for  Purchases.  Account for or treat (whether in
financial  statements or otherwise) the  transactions  contemplated  hereby in
any manner  other than as sales of the  Receivables  and  Related  Security by
such Originator to the Company.

1. Transaction Documents. Enter into, execute, deliver or otherwise become bound
by any  agreement,  instrument,  document or other  arrangement  (other than the
Credit  Agreement)  that  restricts  the  right  of such  Originator  to  amend,
supplement,  amend and restate or otherwise modify, or to extend or renew, or to
waive any right under, this Agreement or any other Transaction Documents.

I.                                    ARTICLE

                      ADDITIONAL RIGHTS AND OBLIGATIONS IN

                           RESPECT OF THE RECEIVABLES

A. Rights of the Company.  Each Originator  hereby  authorizes the Company,  the
Servicer and the Administrator or their respective designees to take any and all
steps in such  Originator's  name  necessary or desirable,  in their  respective
determination,  to collect  all amounts  due under any and all  Receivables  and
Related Rights, including, without limitation,  endorsing such Originator's name
on checks and other  instruments  representing  Collections  and enforcing  such
Receivables  and the provisions of the related  Contracts  that concern  payment
and/or enforcement of rights to payment.

A.                Responsibilities  of The Originator.  Anything herein to the
contrary notwithstanding:

1.  Each  Originator  agrees to (A)  direct,  and  hereby  grants to each of the
Company  and  the  Administrator  the  authority  to  direct,  all  Obligors  of
Receivables  originated by such Originator to make payments of such  Receivables
directly  to a Lock-Box  Account at a Lock-Box  Bank,  and (B) to  transfer  any
Collections  that it receives  directly,  to the Servicer (for deposit to such a
Lock-Box  Account) within one Business Day of receipt  thereof,  and agrees that
all such Collections shall be deemed to be received in trust for the Company.

1. Each Originator shall perform its obligations hereunder,  and the exercise by
the Company or its  designee  of its rights  hereunder  shall not  relieve  such
Originator from such obligations.

1. None of the Company, the Servicer, the Issuer or the Administrator shall have
any  obligation  or  liability  to any  Obligor or any other  third  Person with
respect to any  Receivables,  Contracts  related  thereto  or any other  related
agreements, nor shall the Company, the Servicer, the Issuer or the Administrator
be obligated to perform any of the obligations of any Originator thereunder.

1. Each  Originator  hereby  grants to  Administrator  an  irrevocable  power of
attorney, with full power of substitution,  coupled with an interest, to take in
the name of such  Originator  all  steps  necessary  or  advisable  to  indorse,
negotiate or otherwise realize on any writing or other right of any kind held or
transmitted  by such  Originator  or  transmitted  or  received  by the  Company
(whether or not from such  Originator)  in  connection  with any  Receivable  or
Related Right.

A. Further Action Evidencing Purchases. Each Originator agrees that from time to
time,  at its  expense,  it  will  promptly  execute  and  deliver  all  further
instruments  and documents,  and take all further action that the Company or the
Servicer  may  reasonably  request  in order to  perfect,  protect or more fully
evidence the  Receivables  (and the Related  Rights)  purchased  by, the Company
hereunder,  or to enable the  Company to  exercise  or enforce any of its rights
hereunder  or  under  any  other  Transaction  Document.  Without  limiting  the
generality of the foregoing,  upon the request of the Company,  each  Originator
will:

1.                execute and file such financing or continuation  statements,
or amendments  thereto or assignments  thereof,  and such other instruments or
notices, as may be necessary or appropriate; and

1.                mark the summary  master  control  data  processing  records
with the legend set forth in Section 4.1(i).

Each  Originator  hereby  authorizes  the Company or its designee to file one or
more  financing  or  continuation   statements,   and  amendments   thereto  and
assignments thereof,  relative to all or any of the Receivables (and the Related
Rights)  now  existing  or  hereafter  generated  by  such  Originator.  If such
Originator  fails to perform any of its  agreements  or  obligations  under this
Agreement, the Company or its designee may (but shall not be required to) itself
perform, or cause performance of, such agreement or obligation, and the expenses
of the Company or its designee incurred in connection therewith shall be payable
by such non-performing Originator as provided in Section 9.1.

A.  Application  of  Collections.  Any  payment  by an Obligor in respect of any
indebtedness owed by it to any Originator shall,  except as otherwise  specified
by such  Obligor or otherwise  required by contract or law and unless  otherwise
instructed  by  the  Company  or  the  Administrator,  be  applied  first,  as a
Collection of any  Receivables of such Obligor,  in the order of the age of such
Receivables,  starting with the oldest of such  Receivables,  and second, to any
other indebtedness of such Obligor.

I.                                    ARTICLE

                      PURCHASE AND SALE TERMINATION EVENTS

A.                Purchase   and  Sale   Termination   Events.   Each  of  the
following   events  or  occurrences   described  in  this  Section  8.1  shall
constitute a "Purchase and Sale Termination Event":

1.                The Facility Termination Date shall have occurred; or

1.                Any Originator  shall fail to make any payment or deposit to
be made by it hereunder when due and such failure shall remain  unremedied for
two Business Days after written notice; or

1. Any  representation  or warranty made or deemed to be made by any  Originator
(or any of its officers) under or in connection  with this Agreement,  any other
Transaction  Document  or any other  information  or report  delivered  pursuant
hereto or thereto  shall prove to have been false or  incorrect  in any material
respect when made or deemed made (other than with respect to any  Receivable for
which the Purchase  Price has been reduced and accounted for pursuant to Section
3.3); or

1.                Any  Originator  shall  fail to  perform  or  observe in any
material  respect any material  agreement  contained in any of Sections 6.1(h)
or 6.3; or

1. Any Originator  shall fail to perform or observe in any material  respect any
other term,  covenant or agreement contained in this Agreement on its part to be
performed or observed and such failure shall remain  unremedied  for thirty (30)
days after written  notice  thereof  shall have been given by the Servicer,  the
Administrator or the Company to such Originator; or

a) Any Originator or any of its  subsidiaries  shall generally not pay its debts
as such debts  become due, or shall  admit in writing its  inability  to pay its
debts  generally,  or  shall  make a  general  assignment  for  the  benefit  of
creditors;  or any proceeding  shall be instituted by or against such Originator
or any of its subsidiaries seeking to adjudicate it a bankrupt or insolvent,  or
seeking  liquidation,  winding  up,  reorganization,   arrangement,  adjustment,
protection,  relief, or composition of it or its debts under any law relating to
bankruptcy,  insolvency or reorganization  or relief of debtors,  or seeking the
entry of an order for relief or the appointment of a receiver, trustee, or other
similar  official for it or for all or any substantial part of its property and,
in the case of any such proceeding  instituted against it (but not instituted by
it), such  proceeding  shall remain  undismissed  or unstayed for a period of 60
days;  or any  Originator  or any of its  subsidiaries  shall take any corporate
action to  authorize  any of the  actions  set forth in clause (i) above in this
Section 8.1(f); or

1. The Internal  Revenue  Service  shall,  or shall  indicate  its  intention in
writing to any  Originator to, file notice of a lien asserting a claim or claims
pursuant to the Code with regard to any of the assets of any Originator,  or the
Pension Benefit Guaranty  Corporation  shall, or shall indicate its intention in
writing to such  Originator  or an ERISA  Affiliate  to, either file notice of a
lien  asserting  a claim  pursuant  to ERISA  with  regard to any assets of such
Originator or an ERISA Affiliate or terminate any benefit plan that has unfunded
benefit liabilities.

A.                Remedies.
a) Optional Termination.  Upon the occurrence of a Purchase and Sale Termination
Event,  the Company shall have the option by notice to the  Originators  (with a
copy to the  Administrator) to declare the Purchase and Sale Termination Date to
have occurred.

a) Remedies  Cumulative.  Upon any termination of the Purchase Facility pursuant
to this Section 8.2, the Company shall have, in addition to all other rights and
remedies  under this  Agreement  or  otherwise,  all other  rights and  remedies
provided  under the UCC of each  applicable  jurisdiction  and other  applicable
laws, which rights shall be cumulative.

I.                                    ARTICLE

                                 INDEMNIFICATION

A. Indemnities by the  Originators.  Without limiting any other rights which the
Company may have hereunder or under applicable law, each  Originator,  severally
and itself alone,  and IMO jointly and  severally  with each  Originator  hereby
agrees to indemnify  the Company and each of its assigns,  officers,  directors,
employees and agents (each of the foregoing Persons being individually  called a
"Purchase and Sale Indemnified  Party"),  forthwith on demand,  from and against
any and all damages,  losses, claims,  judgments,  liabilities and related costs
and expenses, including reasonable attorneys' fees and disbursements (all of the
foregoing being  collectively  called "Purchase and Sale  Indemnified  Amounts")
awarded  against or incurred by any of them arising out of or as a result of the
following:

1.                the  transfer  by  such  Originator  of an  interest  in any
Receivable or Related Right to any Person other than the Company;

1. the breach of any representation or warranty made by such Originator under or
in connection  with this  Agreement or any other  Transaction  Document,  or any
information or report  delivered by such  Originator  pursuant hereto or thereto
which  shall have been false or  incorrect  in any  respect  when made or deemed
made;

1.                the   failure  by  such   Originator   to  comply  with  any
applicable  law,  rule or  regulation  with respect to any  Receivable  or the
related  Contract,  or the  nonconformity  of any  Receivable  or the  related
Contract with any such applicable law, rule or regulation;

1.                the  failure to vest and  maintain  vested in the Company an
ownership  interest in the  Receivables  generated by such  Originator and the
Related Rights free and clear of any Adverse Claim;

1. the failure of such  Originator to file with respect to itself,  or any delay
by such Originator in filing,  financing statements or other similar instruments
or documents under the UCC of any applicable  jurisdiction  or other  applicable
laws with respect to any Receivables or purported  Receivables generated by such
Originator or any Related Rights,  whether at the time of any purchase or at any
subsequent time;

1. any  dispute,  claim,  offset or defense  (other  than  discharge  or stay in
bankruptcy)  of the  Obligor  to the  payment  of any  Receivable  or  purported
Receivable  generated  by such  Originator  (including,  without  limitation,  a
defense  based on such  Receivable  or the related  Contract  not being a legal,
valid  and  binding  obligation  of  such  Obligor  enforceable  against  it  in
accordance  with its  terms),  or any other  claim  resulting  from the goods or
services  related  to any such  Receivable  or the  furnishing  of or failure to
furnish such goods or services;

1.                any product  liability claim arising out of or in connection
with goods or services that are the subject of any Receivable;

1.                any  litigation,  proceeding or  investigation  against such
Originator;

1. any tax or governmental  fee or charge (other than any tax excluded  pursuant
to the proviso  below),  all  interest  and  penalties  thereon or with  respect
thereto, and all out-of-pocket costs and expenses, including the reasonable fees
and expenses of counsel in defending against the same, which may arise by reason
of the purchase or ownership of the  Receivables or any Related Right  connected
with any such Receivables; and

1.                any  failure of such  Originator  to  perform  its duties or
obligations  in accordance  with the provisions of this Agreement or any other
Transaction Document;

excluding,  however,  (i)  Purchase and Sale  Indemnified  Amounts to the extent
resulting from gross negligence or willful  misconduct on the part of a Purchase
and Sale Indemnified  Party,  (ii) any  indemnification  which has the effect of
recourse for  non-payment  or late payment of the  Receivables to any indemnitor
due to credit  reasons,  (iii) any tax based upon or  measured  by net income or
gross receipts,  and (iv) any  withholding  taxes imposed as a result of amounts
paid or payable to such  Purchase and Sale  Indemnified  Party  pursuant to this
Agreement.

      If for any reason the  indemnification  provided above in this Section 9.1
is unavailable to a Purchase and Sale  Indemnified  Party or is  insufficient to
hold  such  Purchase  and Sale  Indemnified  Party  harmless,  then  each of the
Originators, severally and for itself alone, and IMO, jointly and severally with
each  Originator,  shall  contribute  (subject to the provisions in this Section
9.1) to the amount paid or payable by such Purchase and Sale  Indemnified  Party
as a result of such loss,  claim,  damage or  liability  to the  maximum  extent
permitted under applicable law.

I.                                    ARTICLE

                                  MISCELLANEOUS

A.                Amendments, etc.

1. The provisions of this  Agreement may from time to time be amended,  modified
or waived, if such amendment, modification or waiver is in writing and consented
to by the Company, IMO the Administrator and the Originators (with respect to an
amendment) or by the Company (with respect to a waiver or consent by it).

1. No failure or delay on the part of the Company,  Servicer,  any Originator or
any third party  beneficiary  in exercising any power or right  hereunder  shall
operate as a waiver  thereof,  nor shall any single or partial  exercise  of any
such  power or right  preclude  any other or  further  exercise  thereof  or the
exercise of any other power or right. No notice to or demand on the Company, the
Servicer, or any Originator in any case shall entitle it to any notice or demand
in similar or other  circumstances.  No waiver or approval by the Company or the
Servicer under this Agreement  shall,  except as may otherwise be stated in such
waiver or approval,  be  applicable  to  subsequent  transactions.  No waiver or
approval under this Agreement shall require any similar or dissimilar  waiver or
approval thereafter to be granted hereunder.

A.  Notices,  etc. All notices and other  communications  provided for hereunder
shall,  unless  otherwise  stated  herein,  be in writing  (including  facsimile
communication)  and shall be  personally  delivered  or sent by express  mail or
courier or by certified mail, postage-prepaid,  or by facsimile, to the intended
party at the address or facsimile  number of such party set forth under its name
on the signature  pages hereof or at such other  address or facsimile  number as
shall be  designated  by such  party in a written  notice  to the other  parties
hereto.  All  such  notices  and  communications  shall  be  effective,  (i)  if
personally  delivered or sent by express mail or courier or if sent by certified
mail, when received,  and (ii) if transmitted by facsimile,  when sent,  receipt
confirmed by telephone or electronic means.

A.                No  Waiver;   Cumulative   Remedies.   The  remedies  herein
provided are cumulative and not exclusive of any remedies provided by law.

A. Binding Effect; Assignability. This Agreement shall be binding upon and inure
to the  benefit  of  the  Company  and  each  Originator  and  their  respective
successors  and permitted  assigns;  provided,  however,  that no Originator may
assign  its rights  hereunder  or any  interest  herein or  delegate  its duties
hereunder   without   the  prior   written   consent  of  the  Company  and  the
Administrator.  This  Agreement  shall  create  and  constitute  the  continuing
obligations of the parties hereto in accordance with its terms, and shall remain
in full force and effect until the date after the Purchase and Sale  Termination
Date on which the Originators  have received payment in full for all Receivables
and Related  Rights  purchased  pursuant  to Section 1.1 hereof.  The rights and
remedies with respect to any breach of any  representation  and warranty made by
any  Originator  pursuant  to  Article  V and the  indemnification  and  payment
provisions of Article IX and Section 10.6 shall be continuing  and shall survive
any termination of this Agreement.

A.                Governing  Law.  THIS  AGREEMENT  SHALL BE GOVERNED  BY, AND
CONSTRUED IN ACCORDANCE  WITH,  THE INTERNAL LAWS, AND NOT THE CONFLICT OF LAW
PRINCIPLES,  OF THE STATE OF NEW YORK EXCEPT TO THE EXTENT  THAT THE  VALIDITY
OR PERFECTION OF A SECURITY INTEREST OR REMEDIES HEREUNDER,  IN RESPECT OF ANY
PARTICULAR  COLLATERAL ARE GOVERNED BY THE LAWS OF A  JURISDICTION  OTHER THAN
THE STATE OF NEW YORK.

A.                Costs,  Expenses and Taxes.  In addition to the  obligations
of the Originators under Article IX, each Originator agrees to pay on demand:

1.                all  reasonable  costs and expenses in  connection  with the
enforcement of this Agreement and the other Transaction Documents; and

1. all stamp and  other  similar  taxes and fees  payable  or  determined  to be
payable in connection with the execution, delivery, filing and recording of this
Agreement  or the other  Transaction  Documents,  and agrees to  indemnify  each
Purchase and Sale  Indemnified  Party against any liabilities with respect to or
resulting from any delay in paying or omission to pay such taxes and fees.

A. Submission to Jurisdiction.  EACH PARTY HERETO HEREBY IRREVOCABLY (a) SUBMITS
TO THE  NON-EXCLUSIVE  JURISDICTION  OF ANY COURT OF THE STATE OF NEW YORK OR OF
THE UNITED  STATES FOR THE  SOUTHERN  DISTRICT  OF NEW YORK,  OVER ANY ACTION OR
PROCEEDING  ARISING OUT OF OR RELATING TO ANY TRANSACTION  DOCUMENT;  (b) AGREES
THAT ALL  CLAIMS  IN  RESPECT  OF SUCH  ACTION  OR  PROCEEDING  MAY BE HEARD AND
DETERMINED  IN SUCH STATE OR UNITED STATES  FEDERAL  COURT;  (c) WAIVES,  TO THE
FULLEST EXTENT IT MAY EFFECTIVELY DO SO UNDER  APPLICABLE LAW, THE DEFENSE OF AN
INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR PROCEEDING; (d) CONSENTS
TO THE SERVICE OF ANY AND ALL PROCESS IN ANY SUCH  ACTION OR  PROCEEDING  BY THE
MAILING OF COPIES OF SUCH  PROCESS TO SUCH  PERSON AT ITS ADDRESS  SPECIFIED  IN
SECTION 10.2; AND (e) TO THE EXTENT ALLOWED BY LAW,  AGREES THAT A NONAPPEALABLE
FINAL  JUDGMENT IN ANY SUCH ACTION OR PROCEEDING  SHALL BE CONCLUSIVE AND MAY BE
ENFORCED IN OTHER  JURISDICTIONS  BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER
PROVIDED BY LAW.  NOTHING IN THIS SECTION 10.7 SHALL AFFECT THE COMPANY'S  RIGHT
TO SERVE  LEGAL  PROCESS IN ANY OTHER  MANNER  PERMITTED  BY LAW OR TO BRING ANY
ACTION OR PROCEEDING  AGAINST THE ORIGINATOR OR ITS  RESPECTIVE  PROPERTY IN THE
COURTS OF ANY OTHER JURISDICTIONS.

A. Waiver of Jury Trial. EACH PARTY HERETO EXPRESSLY WAIVES ANY RIGHT TO A TRIAL
BY JURY IN ANY ACTION OR  PROCEEDING  TO ENFORCE OR DEFEND ANY RIGHTS UNDER THIS
AGREEMENT, ANY OTHER TRANSACTION DOCUMENT, OR UNDER ANY AMENDMENT, INSTRUMENT OR
DOCUMENT  DELIVERED  OR WHICH  MAY IN THE  FUTURE  BE  DELIVERED  IN  CONNECTION
HEREWITH  OR ARISING  FROM ANY  RELATIONSHIP  EXISTING IN  CONNECTION  WITH THIS
AGREEMENT OR ANY OTHER TRANSACTION DOCUMENT,  AND AGREES THAT ANY SUCH ACTION OR
PROCEEDING SHALL BE TRIED BEFORE A COURT AND NOT BEFORE A JURY.

A.  Captions  and Cross  References;  Incorporation  by  Reference.  The various
captions  (including,  without  limitation,  the  table  of  contents)  in  this
Agreement are included for convenience  only and shall not affect the meaning or
interpretation of any provision of this Agreement.  References in this Agreement
to any  underscored  Section or Exhibit  are to such  Section or Exhibit of this
Agreement,  as the case may be. The Exhibits  hereto are hereby  incorporated by
reference into and made a part of this Agreement.

A.                Execution in  Counterparts.  This  Agreement may be executed
in any number of  counterparts  and by  different  parties  hereto in separate
counterparts,  each of  which  when  so  executed  shall  be  deemed  to be an
original and all of which when taken  together  shall  constitute  one and the
same Agreement.

A. Acknowledgment and Agreement.  By execution below, each Originator  expressly
acknowledges and agrees that all of the Company's  rights,  title, and interests
in, to, and under this Agreement  shall be assigned by the Company to the Issuer
pursuant to the Receivables Purchase Agreement,  and such Originator consents to
all such  assignments.  Each of the parties hereto  acknowledges and agrees that
the Administrator and the Issuer are third party  beneficiaries of the rights of
the Company arising hereunder and under the other Transaction Documents to which
such Originator is a party.

                           Purchase and Sale Agreement

     IN WITNESS  WHEREOF,  the parties have caused this Agreement to be executed
by their respective officers thereunto duly
authorized, as of the date first above written.

                                 IMO FUNDING COMPANY, LLC

                                 By: ___________________________________
                                 Name:   John A. Young
                                 Title:     Vice President

                                 9211 Forest Hill Avenue
                                 Suite 109
                                 Richmond, Virginia 23235
                                 Attention: John A. Young
                                 Telephone: (804) 327-5673
                                 Facsimile:   (804) 327-5688

                                 IMO INDUSTRIES INC., as initial Servicer

                                 By: ____________________________________
                                 Name:   John A. Young
                                 Title:     Vice President

                                 997 Lenox Drive

                                    Suite 111

                                 Lawrenceville, New Jersey 08648
                                 Attention:    Thomas M. O'Brien
                                 Telephone:  (609) 896-7627
                                 Facsimile:    (609) 896-7633
                                 ORIGINATORS:

                                 IMO INDUSTRIES INC., as an Originator

                                 By: ___________________________________
                                 Name: _________________________________
                                 Title: __________________________________

                                 997 Lenox Drive

                                    Suite 111

                                 Lawrenceville, New Jersey 08648
                                 Attention:    Thomas M. O'Brien
                                 Telephone:  (609) 896-7627
                                 Facsimile:    (609) 896-7633

                                 WARREN PUMPS INC., as an Originator

                                 By: ___________________________________
                                 Name: _________________________________
                                 Title: __________________________________

                                 82 Bridges Avenue
                                 Warren, Massachusetts 01083-0959
                                 Attention: Gary A. Young
                                 Telephone: (413) 436-7711 (x200)
                                 Facsimile:   (413) 436-5605

                                  SCHEDULE 5.13

                                OFFICE LOCATIONS

Imo Industries Inc.

Principal Place of Business and Chief Executive Office:

997 Lenox Drive
Suite 111

Lawrenceville, New Jersey 08648

Additional Offices:

3900 Westinghouse Boulevard
Charlotte, NC 28373
Mecklenburg County

506 South Bickett Boulevard
Louisburg, NC 27549
Franklin County

7970 U.S. 24 Dixie Highway
Florence, KY 41042

13517 Pumice Street
Norwalk, CA

3750 East Market St.
York, PA 17402
York County

1710 Airport Road
Monroe, NC 28111-5020
Union County

479 Industrial Park Road
Columbia, KY 42728
Adair County

21 Clinton Street
Hudson, OH 44236-2899
Summit County

1579 Barber Road
Sarasota, FL 34240
Sarasota County

500 B. Edwards Avenue
New Orleans, LA 23279

9211 Forest Hill Avenue
Suite 109
Richmond, Virginia 23235

12600 SE 38th Street
Suite 230
Bellevue, Washington 98006

Warren Pumps Inc.

Principal Place of Business and Chief Executive Office:

82 Bridges Avenue
Warren, Massachusetts 01083-0959

Additional Offices:

1710 Airport Road
Monroe, NC 28111-5020
Union County

                                SCHEDULE 5.14(a)

                                   TRADE NAMES

Imo Industries Inc.

Boston Gear
Morse Controls
Imo Pump
Fincor
Colfax Pump Group

Colfax Power Transmission

Warren Pumps Inc.

Warren
Colfax Pump Group

                                SCHEDULE 5.14(b)

             PREVIOUS NAMES, MERGERS OR CORPORATE REORGANIZATION

Imo Industries Inc.

None

Warren Pumps Inc.

None

                                    EXHIBIT A

                             FORM OF PURCHASE REPORT

                                    EXHIBIT B

                              FORM OF COMPANY NOTE

                                    EXHIBIT C

                   FORM OF OPINION OF ORIGINATOR'S COUNSEL

                                    EXHIBIT D

                            FORM OF JOINDER AGREEMENT

                                    EXHIBIT E

                  FORM OF ORIGINATOR ASSIGNMENT CERTIFICATESTOCK PURCHASE AGREEMENT

                                 by and between

                                   Echlin Inc.

                                       and

                               Imo Industries Inc.

                          Dated as of October 13, 1999

                                TABLE OF CONTENTS

                                                 Page

ARTICLE I

  DEFINITIONS                                                1

ARTICLE II  SALE AND PURCHASE OF SHARES                1
2.1   Sale and Purchase of Shares                      1
2.2   Purchase Price                                   2
2.3   Purchase Price Adjustment                        2

ARTICLE III

  CLOSING AND DELIVERIES                                     4

  3.1       Closing                                          4
  3.2.      Deliveries by Seller                                   4
  3.3       Deliveries by Buyer                                    6

ARTICLE IV

  REPRESENTATIONS AND WARRANTIES OF SELLER       6

  4.1       Organization and Standing                              6
  4.2       Authorization, Validity and Effect                     6
  4.3       Capitalization                                   6
  4.4       Title                                            7
  4.5       No Conflict; Required Filings and Consents             7
  4.6       Financial Statements                             7
  4.7       Taxes                                            8
  4.8       Properties, Assets and Leases                    8
  4.9       Employee Benefit Plans                           9
  4.10      Company Contracts                               10
  4.11      Legal Proceedings                               11
  4.12      Year 2000 Compliance                            11
  4.13      Compliance with Laws                            11
  4.14      Environmental Matters                           11
  4.15      Intellectual Property                                 12
  4.16      No Brokers                                      12
  4.17      Company Employees                         12
  4.18      Bank Accounts                                   12

ARTICLE V

  REPRESENTATIONS AND WARRANTIES OF BUYER       13

  5.1       Investment Intent                               13
  5.2       Organization and Standing                             13
  5.3       Authorization, Validity and Effect                    13
  5.4       No Conflict; Required Filings and Consents            13
  5.5       Legal Proceedings                               14
  5.6       No Brokers                                      14
5.7   Buyer's Financing                               14
  5.8       Financial Information                           14
  5.9       No Reliance                                     14

ARTICLE VI

  COVENANTS AND AGREEMENTS                            15

  6.1       Interim Operations of the Company               15
  6.2       Reasonable Access; Confidentiality              16
  6.3       Filings; Other Action                           16
  6.4       Publicity                                       16
  6.5       Records                                         17
  6.6       Tax Matters                                     17
  6.7       Allocation Matters                                    18
  6.8       NAPA Business Practices                         19
  6.9       Non-Competition                                 19
  6.10      Accounts Receivable                             20

ARTICLE VII

  CONDITIONS TO CLOSING                               20

  7.1       Conditions to Obligations of Seller and Buyer         20
  7.2       Conditions to Obligation of Seller                    20
  7.3       Conditions to Obligation of Buyer                     21

ARTICLE VIII

  SURVIVAL AND INDEMNIFICATION                        22

  8.1       Survival Periods                                22
  8.2       Indemnification                                 22
  8.3       Indemnification Amounts                         23
  8.4       Claims                                          23
  8.5       Exclusive Remedy                                24
  8.6       Tax and Insurance                               24

ARTICLE IX

  EMPLOYEE BENEFIT MATTERS                            25

  9.1       Employment                                      25
  9.2       Compensation and Employee Benefits              25
  9.3       WARN Act and Severance                          26

ARTICLE X

  TERMINATION OF AGREEMENT                            27

  10.1      Termination                                     27
  10.2      Effect of Termination                           27

ARTICLE XI

  MISCELLANEOUS AND GENERAL                           28

  11.1      Expenses                                        28
  11.2      Successors and Assigns                          28
  11.3      No Third Party Beneficiaries                    28
  11.4      Notices                                         28
  11.5      Complete Agreement                              30
  11.6      Captions; References                            30
  11.7      Amendment                                       30
  11.8      Waiver                                          30
  11.9      Governing Law                                   30
  11.10     Severability                                          30
  11.11     Further Assurances                                    30
  11.12     Disclosure Schedule Supplements                 31
  11.13     Mutual Drafting                                 31
  11.14     Counterparts                                          31

                                    Exhibits

Exhibit A               Current Competitors
Exhibit B               Current Customers

Exhibit C               Employee Retention Incentive Agreements
Exhibit D               Freight Agreement
Exhibit E               Litchfield Facility Lease
Exhibit F               Specified Accounting Principles
Exhibit G               Supply Agreement
Exhibit H               Transitional Services Agreement
Exhibit I               Trucking Agreement

                                    Schedules

Schedule 4.5                  Conflicts, Filings and Liens; Approvals
Schedule 4.6                  Financial Statements
Schedule 4.7                  Taxes
Schedule 4.8(a)         Liens
Schedule 4.8(b)         Real Property
Schedule 4.8(c)         Personal Property Leases
Schedule 4.8(d)         Material Equipment
Schedule 4.9                  Company Benefit Arrangements
Schedule 4.10           Company Contracts
Schedule 4.11           Legal Proceedings
Schedule 4.13           Compliance with Laws
Schedule 4.14           Environmental Matters
Schedule 4.15           Intellectual Property
Schedule 4.17           Employees
Schedule 4.18           Bank Accounts
Schedule 5.4(b)         Buyer's Conflicts; Filings and Consents; Approvals
Schedule 5.5                  Legal Proceedings
Schedule 6.1                  Interim Operations of the Company
Schedule 9.1                  List of Certain Continuing Employees

                            STOCK PURCHASE AGREEMENT

          THIS  STOCK  PURCHASE  AGREEMENT  (this  "Agreement"),  dated  as of
October 13.  1999,  by and between  Echlin  Inc.,  a  Connecticut  corporation
("Seller"), and IMO Industries, Inc., a Delaware corporation ("Buyer").

                                    RECITALS:

          A.      Automotive  Controls  Corp.,  a wholly owned  subsidiary  of
    Seller (the "Shareholder"),  is the beneficial and record owner of all the
    issued and  outstanding  shares (the "Shares") of common stock,  par value
    of $1.00 per share, of Sierra  International Inc., an Illinois corporation
    (the "Company").

          B.            Seller  desires  Shareholder  to  sell to  Buyer,  and
    Buyer  desires to purchase  from  Shareholder,  all of the Shares upon the
    terms set forth in this Agreement.

          NOW,  THEREFORE,  in consideration of the foregoing and the respective
    representations,  warranties, covenants and agreements set forth herein, and
    subject  to the terms and  conditions  set forth  herein,  Seller  and Buyer
    hereby agree as follows:

                                    ARTICLE I

                                   DEFINITIONS

          See Appendix A for a list of the definitions used in this Agreement.

                                   ARTICLE II

                           DATE AND PURCHASE OF SHARES

          2.1 Sale and Purchase of Shares.  Subject to the terms and  conditions
    of this Agreement,  at the Closing (a) Seller shall cause the Shareholder to
    sell,  assign and  transfer all of the Shares to Buyer free and clear of any
    and all Liens  except  any  created  by or through  Buyer,  (b) Buyer  shall
    purchase all of the Shares,  (c) Seller  shall  deliver to Buyer one or more
    stock  certificates  representing the Shares with duly executed stock powers
    attached in proper form for transfer to Buyer or its designee, and (d) Buyer
    shall pay and  deliver to Seller the  Purchase  Price as provided in Section
    2.2 below.

          2.2 Purchase Price. In full  consideration  for the Shares and subject
    to adjustment  pursuant to Section 2.3 below,  Buyer shall (a) pay to Seller
    at the Closing by wire transfer of immediately available funds to an account
    designated by Seller prior to the Closing an aggregate  amount of cash equal
    to $34,000,000  (the "Purchase  Price") and (b) assume those  obligations of
    Dana  Corporation,  a  Virginia  corporation  ("Dana")  under  the  Employee
    Retention Incentive Agreements to be assumed pursuant to Section 7.2(d).

          2.3           Purchase Price Adjustment

                (a) As used herein,  the term "Closing Net Working Assets" means
    the aggregate of the sum of the value of the net trade  accounts  receivable
    and the value of the net inventory  less the value of the net trade accounts
    payable of the Company as of the close of  business on the date  immediately
    preceding  the Closing Date and as such values are  determined in accordance
    with the  Specified  Accounting  Principles  and  reflected in the Final Net
    Working Assets Statement.

                (b) Within forty five (45) days after the Closing  Date,  Seller
    shall  prepare and  deliver to Buyer a statement  of the Closing Net Working
    Assets of the Company,  together with footnotes (collectively,  the "Closing
    Net Working Assets Statement"). Seller shall prepare the Closing Net Working
    Assets Statement in accordance with the Specified Accounting  Principles and
    the net  inventory  value to be reflected on the Closing Net Working  Assets
    Statement is to be based on a physical inventory to be commenced by Buyer on
    the Closing  Date and to be conducted by Buyer in the presence and under the
    supervision of Seller's Accountants.  Buyer shall promptly deliver to Seller
    the results of the inventory count and shall grant Seller's Accountants such
    access to the Company's  facilities and the results of the physical count as
    Seller  reasonably  requires  to prepare  the  Closing  Net  Working  Assets
    Statement.

                (c)  Buyer  shall   allow   Seller  and   Seller's   independent
    accountants ("Seller's Accountants") access to the business,  books, records
    and  personnel  of the  Company  and the work  papers,  if any,  of  Buyer's
    independent accountants ("Buyer's Accountants"),  prepared subsequent to the
    date hereof which are relevant to the Closing Net Working Assets  Statement,
    and shall  cooperate  and direct its personnel  and Buyer's  Accountants  to
    cooperate with Seller and Seller's Accountants to facilitate preparation and
    delivery of the Closing Net Working Assets  Statement and in connection with
    the resolution of any disputes with respect thereto and the determination of
    the Final  Net  Working  Assets  Statement.  Buyer and its  representatives,
    including Buyer's  Accountants,  will be entitled to review all work papers,
    if any, of Seller's  Accountants prepared subsequent to the date hereof, and
    to obtain access to the books and records of Seller or its Affiliates to the
    extent  necessary  for  Buyer to  review  the  Closing  Net  Working  Assets
    Statement and to resolve any disputes concerning the same.

                (d) The Closing Net Working Assets Statement delivered by Seller
    to  Buyer  will be the  Final  Net  Working  Assets  Statement  and  will be
    conclusive and binding on the parties  unless Buyer,  within the thirty (30)
    day period  after the  delivery to Buyer of the  Closing Net Working  Assets
    Statement, notifies Seller in writing that Buyer disputes any of the amounts
    set forth  therein,  specifying  the  nature of each  dispute  and the basis
    therefor (the "Dispute Notice");  provided, that Buyer may deliver a Dispute
    Notice only if Buyer  reasonably  believes  the  Closing Net Working  Assets
    Statement  contains   mathematical  errors  or  has  not  been  prepared  in
    accordance  with  the  Specific  Accounting  Policies.  Failure  by Buyer to
    dispute the amounts  reflected in the Closing Net Working  Assets  Statement
    within such thirty (30) day period will be deemed an acquiescence thereto by
    Buyer. The parties shall attempt in good faith to reach agreement  resolving
    all of the disputes set forth in the Dispute  Notice within thirty (30) days
    alter the Dispute Notice is delivered by Buyer to Seller, in which event the
    Closing Net Working Assets Statement,  as amended to the extent necessary to
    reflect the resolution of all such  disputes,  will be the Final Net Working
    Assets  Statement and will be conclusive and binding on the parties.  If the
    parties  are  unable  to  resolve  any or all of such  disputes  within  the
    aforesaid  thirty (30) day  period,  the parties  will,  promptly  after the
    expiration  of such  time  period,  submit  for  resolution  all  unresolved
    disputes  to  Ernst &  Young,  as an  arbiter  (the  "Designated  Accounting
    Arbitrator")  for resolution.  Promptly,  but no later than thirty (30) days
    after its acceptance of its appointment as Designated Accounting Arbitrator,
    the  Designated  Accounting  Arbitrator  shall  determine,  based  solely on
    presentation by Buyer and Seller, and not by independent review, those items
    in dispute on the Closing Net Working  Assets  Statement  and shall render a
    written  report  as to the  resolution  of each  dispute  and the  resulting
    calculation  of the Final Net Working  Assets  Statement and the Closing Net
    Working  Assets.  In resolving any disputed item, the Designated  Accounting
    Arbitrator  may not assign a value to such item  greater  than the  greatest
    value for such item claimed by either party or less than the smallest  value
    for such item claimed by either party. The Designated  Accounting Arbitrator
    will  have  exclusive  jurisdiction  over,  and  resort  to  the  Designated
    Accounting  Arbitrator  as provided in this  paragraph  (d) will be the sole
    recourse and remedy of, the parties  against one another or any other person
    (including Seller's Accountants or Buyer's Accountants) with respect to, any
    disputes  arising out of or  relating  to the  Closing  Net  Working  Assets
    Statement and/or the Final Net Working Assets Statement;  and the Designated
    Accounting Arbitrator's  determination will be conclusive and binding on the
    parties and will be enforceable in a court of law.

                (e)  Seller   shall  pay  the  fees  and  expenses  of  Seller's
    Accountants.  Buyer shall pay the fees and expenses of Buyer's  Accountants.
    Buyer and Seller shall share equally the fees and expenses of the Designated
    Accounting Arbitrator.

                (f)  As  used  herein,   the  term  "Final  Net  Working  Assets
    Statement"  means (i) the Closing Net Working Assets Statement if no Dispute
    Notice is given by Buyer within the time period set forth in Section  2.3(d)
    or (ii) if the Dispute  Notice is timely given and all of the disputed items
    are resolved by mutual  agreement  of the  parties,  the Closing Net Working
    Assets Statement,  as amended,  if necessary,  to reflect such resolution of
    all disputes,  or (iii) if any or all of the disputed items are submitted to
    the Designated Accounting Arbitrator for resolution, the Closing Net Working
    Assets Statement, as amended, if necessary, to reflect any resolution of any
    disputes by mutual  agreement of the parties and the resolution of all other
    disputes by the Designated Accounting Arbitrator.

                (g) If the Closing Net Working Assets exceeds $18,871,000, Buyer
    shall pay to Seller the amount of such  excess.  If the  Closing Net Working
    Assets is less than  $18,871,000,  Seller shall pay Buyer the amount of such
    difference.  Any  payments  made by  Buyer  or  Seller,  as the case may be,
    pursuant to this Section 2.3(g) will be made together with interest  thereon
    from the Closing Date to the date of payment at a rate of eight percent (8%)
    per annum within  thirty (30)  Business  Days of the date on which the Final
    Net Working  Assets  Statement is determined by wire transfer of immediately
    available funds to the account designated by the payee;  provided,  however,
    that,  if payment is not made within such thirty  Business  Day period,  the
    applicable  rate of interest is to be eleven percent (11%) per annum for the
    period from the day  following  such date  through the date such  payment is
    made.

                                   ARTICLE III

                             CLOSING AND DELIVERIES

          3.1 Closing. The closing of the transactions  contemplated hereby (the
    "Closing")  is to take place at the offices of Jones,  Day,  Reavis & Pogue,
    North Point,  901 Lakeside  Avenue,  Cleveland,  Ohio 44114,  at 10:00 a.m.,
    local time on the first Business Day following the satisfaction or waiver of
    each of the conditions set forth in Article VII (other than those conditions
    that are to be satisfied at the  Closing),  or on such other date or at such
    other time and place as the parties  mutually agree in writing (the "Closing
    Date").  All  proceedings  to be taken and all  documents to be executed and
    delivered  by all parties at the  Closing  will be deemed to have been taken
    and executed  simultaneously  and no proceedings will be deemed to have been
    taken nor  documents  executed  or  delivered  until  all have  been  taken,
    executed and delivered.

          3.2     Deliveries by Seller.  At the Closing,  Seller shall deliver
    or cause to be delivered to Buyer the following items:

                (a)  One  or  more   certificates   representing  the  Shares,
    accompanied by duly executed stock powers in proper form for transfer;

                (b)  The Articles of Incorporation  of the Company,  certified
    as of the most recent  practicable  date by the  Secretary of State of the
    State of Illinois;

                (c) A  Certificate  of the  Secretary  of State of the  State of
    Illinois as to the good standing as of the most recent  practicable  date of
    the Company in Illinois and a  certificate  of good  standing as of the most
    recent practicable date from the appropriate  Governmental Authority in each
    state where the Company is qualified to do business;

                (d)  A certificate  of the  Secretary of Seller  certifying as
    to  the  resolutions  authorizing  this  Agreement  and  the  transactions
    contemplated hereby;

                (e)  The  Supply  Agreement  duly  executed  by Seller and the
    Company;

                (f)  The Freight  Agreement  duly  executed by Echlin  Freight
    Group and the Company;

                (g)  The Trucking  Agreement  duly  executed by DTF  Trucking,
    Inc. and the Company;

                (h)  The  Transitional  Services  Agreement  duly  executed by
    Seller and the Company;

                (j)  The  original  corporate  record  books and stock  record
    book of the Company;

                (k)  The  certificate  from  Seller  referred  to  in  Section
7.3(c); and

                (l)  Written resignations of each director of the Company.

Notwithstanding  the  foregoing,  Seller shall have an  obligation to deliver at
Closing only those agreements referred to in clauses (e) - (h) above which Buyer
has advised  Seller in writing  prior to October 27, 1999 that Buyer  desires to
have Seller deliver.

      3.3       Deliveries by Buyer. At the Closing, Buyer shall deliver or
cause to be delivered to Seller the following items:

                (a)  The Purchase Price,  paid by wire transfer of immediately
    available funds in accordance with Section 2.2(a);

                (b)  The  certificate  of an officer of Buyer  referred  to in
    Section 7.2(c); and

                (c) A certificate of the Secretary of Buyer certifying as to the
    By-laws of Buyer and the  resolutions  authorizing  this  Agreement  and the
    transactions contemplated hereby.

                                   ARTICLE IV

                   REPRESENTATIONS AND WARRANTIES OF SELLER

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

          4.1 Organization and Standing. The Company is duly organized,  validly
    existing  and in  good  standing  under  the  laws  of its  jurisdiction  of
    incorporation.  The Company is duly  qualified  to do  business  and in good
    standing in the jurisdictions in which the character of the properties owned
    or leased by it or in which the conduct of its business requires it to be so
    qualified.

          4.2 Authorization, Validity and Effect. Seller has all requisite power
    and authority to enter into and perform its obligations under this Agreement
    and all agreements and documents  contemplated hereby and to consummate the;
    transactions  contemplated  hereby and thereby,  and this Agreement and such
    other  agreements  and  documents  have been,  or will be, duly executed and
    delivered  by Seller  pursuant to all  necessary  authorization  and are, or
    will, when delivered,  be the legal, valid and binding obligation of Seller,
    enforceable  against Seller in accordance with its terms,  except as limited
    by (a)  applicable  bankruptcy,  reorganization,  insolvency,  moratorium or
    other similar laws affecting the enforcement of creditors'  rights generally
    from time to time in effect and (b) the  availability of equitable  remedies
    (regardless of whether  enforceability  is considered in a proceeding at law
    or in equity).

          4.3  Capitalization.  The  authorized  capital  stock  of the  Company
    consists of 10,000 shares of common stock,  par value of $1.00 per share, of
    which,  only the Shares are  issued and  outstanding.  All of the Shares are
    duly  and   validly   issued  and   outstanding   and  are  fully  paid  and
    nonassessable.  There are no  authorized  or  outstanding  Options  or other
    agreements  under which the Company  may be  obligated  to issue or sell any
    shares of capital stock or any other securities of the Company.

          4.4 Title.  The Shareholder (a) is the record and beneficial  owner of
    all of the  Shares  and (b) has valid  title to all of the  Shares  free and
    clear of all Liens.  Upon the consummation of the transactions  contemplated
    by this  Agreement in accordance  with the terms hereof,  Buyer will acquire
    valid title to the Shares,  free and clear of all Liens except those created
    by or through Buyer.

          4.5     No Conflict; Required Filings and Consents.

                (a) Neither the  execution  and  delivery of this  Agreement  by
    Seller,  nor the  consummation  by Seller of the  transactions  contemplated
    herein, nor compliance by Seller with any of the provisions hereof, will (i)
    conflict  with or  result  in a breach  of any  provision  of the  Company's
    Articles of Incorporation or By-laws, (ii) except as set forth in Schedule 4
    5,  constitute  or result in the breach of any term,  condition or provision
    of, or constitute a default under, or give rise to any right of termination,
    cancellation or  acceleration  with respect to, or result in the creation or
    imposition of any Lien upon any property or assets of the Company,  pursuant
    to any note, bond, mortgage,  indenture,  license, agreement, lease or other
    instrument  or obligation to which the Company is a party or by which any of
    its properties or assets may be subject,  or (iii) subject to receipt of the
    requisite  approvals  referred  to in  Schedule 4 5 violate any Order or Law
    applicable to the Company or any of its properties or assets.

                (b) Other than (i) those required under the HSR. Act and (ii) as
    set forth in Schedule  4.5, no notice to,  filing  with,  authorization  of,
    exemption by or Consent of any Person or Governmental Authority is necessary
    for the  consummation  by Seller of the  transactions  contemplated  in this
    Agreement.

          4.6           Financial Statements.

                (a) The Company has prepared and furnished to Buyer and included
    in Schedule 4.6, the unaudited  balance  sheets of the Company as of the end
    of the fiscal years ending August 31, 1997 and 1998, the end of the calendar
    year ending December 31, 1998, and the unaudited consolidated  statements of
    income for such periods.  The Company has furnished to Buyer and included in
    Schedule 4.6 the  unaudited  balance sheet of the Company for the six months
    ended June 30, 1999 (the "June Balance Sheet), and the unaudited  statements
    of  income  for such  period.  All of the  financial  statements  (i) are in
    accordance with the books and records of the Company, (ii) present fairly in
    all  material  respects  the  financial  position  of the  Company as of the
    respective  dates and the results of operations for the  respective  periods
    indicated,  and  (iii)  have  been  prepared  in all  material  respects  in
    accordance  with GAAP applied on a basis  consistent  with prior  accounting
    periods  except they contain none of the footnotes  required by GAAP and the
    June Balance Sheet reflects no year-end adjustments.

                (b) Except as reflected in the June  Balance  Sheet,  as of June
    30, 1999,  there  existed no  liabilities  (whether  contingent or absolute,
    matured or unmatured,  known or unknown) of the Company. Except as described
    in Schedule 4.6,  since June 30, 1999,  (i) the Company has not incurred any
    liabilities (whether contingent or absolute,  matured or unmatured, known or
    unknown) other than in the ordinary course of business  consistent with past
    practice and (ii) no change or event has  occurred  which has had a Material
    Adverse Effect on the Company.

                (c) The projected  unaudited  balance sheet of the Company as of
    November 30, 1999 has been  delivered to Buyer solely to provide  Buyer with
    an  understanding  of the cyclical  nature of the Business and the basis for
    the adjustment to the Purchase Price under Section 2.3(g).

          4.7           Taxes.

                (a) The Company  has filed all Tax Returns  required to be filed
    by it, paid or made in the June Balance  Sheet  adequate  provision  for the
    payment of all Taxes  shown on such  returns to be owed by it, and no claims
    for  additional  Taxes for any prior  fiscal  years  are  pending  except as
    disclosed in Schedule 4.7. The Company is not a party to any pending Action,
    nor,  to  Seller's  Knowledge,  is  any  such  Action  threatened,   by  any
    Governmental Authority for the assessment or collection of Taxes.

                (b)  The  Company  is a  member  of the  Selling  Consolidated
    group as defined in  Treasury  Reg.ss. 1.338(h)(10)-1(c)(3)  and Seller is
    eligible to make an election under IRCss.338(h)(10).

          4.8     Properties, Assets and Leases.

                (a) Except as  disclosed on Schedule 4 8(a) the Company has good
    and valid title to all of the  properties  and assets  reflected in the June
    Balance Sheet,  free and clear of all Liens except for (i) those  properties
    and assets which have been sold in the ordinary course since the date hereof
    and (ii) such  imperfections or irregularities  of title,  Liens or defaults
    that do not affect the use thereof and statutory Liens securing payments not
    yet due.

                (b) Schedule 4.8(b) contains a complete and accurate description
    in all material respects of all the Real Property and the Company's interest
    therein.  The Real  Property  listed on Schedule  4.8(b)  comprises all real
    property interests used in the conduct of the business and operations of the
    Company as  conducted as of the date  hereof.  The Company has  delivered to
    Buyer  true  and  complete  copies  of all  leases  pertaining  to the  Real
    Property.  Subject to the terms of the Litchfleld  Facility Lease,  all Real
    Property  (including  the  improvements  thereon)  (i) is  available  and is
    adequate for immediate use in the conduct of the business and  operations of
    the  Company  as  currently  conducted  and (ii)  complies  in all  material
    respects with all applicable building or zoning codes and regulations of any
    Governmental Authority having jurisdiction.

                (c)  Schedule  4.8(c)  contains a complete  list of all  vehicle
    leases and  subleases  and all leases and  subleases  pursuant  to which the
    Company leases personal  property that require the payment of $5,000 or more
    per year.  Except as set forth in Schedule 4 8(c),( i) all leases  listed on
    Schedule  4.8(c) and (ii) all leases  pertaining to Real Property are valid,
    binding and enforceable in accordance with their terms, except as limited by
    any applicable bankruptcy,  reorganization,  insolvency, moratorium or other
    similar laws affecting the enforcement of creditors' rights generally and to
    general principles of equity (whether or not considered in a court of law or
    equity), and are in full force and effect. There are no existing defaults by
    the Company  under such leases.  The Company has not received  notice of the
    occurrence of, nor to Seller's Knowledge has there occurred, any event which
    (whether  with  or  without  notice,  lapse  of  time  or the  happening  or
    occurrence of any other event) would  constitute a default under such leases
    by any party thereto.

                (d)  Schedule  4 8(d)  is an  accurate  list  of all  machinery,
    equipment and other tangible  personal  property,  including motor vehicles,
    which are owned by the  Company,  used in the  conduct of its  business  and
    having  a net book  value  in  excess  of  $10,000  as of  August  31,  1999
    (collectively, the "Material Equipment"').  Except as otherwise specified in
    Schedule 4.8(d), to Seller's Knowledge,  all Material Equipment:  is, in all
    material respects,  in good repair and working order and is adequate for the
    conduct of the  Company's  business as  currently  conducted.  Except as set
    forth in Schedule 4 8(d) hereto, no Person, other than the Company, owns any
    equipment  or other  tangible  property  or  assets on the  premises  of the
    Company that is necessary to the operation of the business of the Company.

          4.9 Employee Benefit Plans.  Each "employee  benefit plan", as defined
    in Section  3(3) of ERISA,  maintained,  contributed  to or  required  to be
    contributed to by the Company for the benefit of current, former and retired
    employees (the "Company ERISA Plans") and each other plan, contract, program
    or arrangement  maintained,  contributed to or required to be contributed to
    by the Company for the benefit of current, former and retired employees (the
    "Company Benefit  Arrangements")  complies in all material respects with its
    terms and all applicable Laws, including ERISA, and no "reportable event" or
    "prohibited transaction" (as such terms are defined in ERISA) or termination
    has occurred with respect to any Company ERISA Plan under circumstances that
    present a risk of any material  liability to the Company.  The Company ERISA
    Plans and the  Company  Benefit  Arrangements  are listed on  Schedule  4.9.
    Copies or  descriptions  of each  Company  ERISA  Plan and  Company  Benefit
    Arrangement  have been made  available to Buyer for review prior to the date
    hereof.  The Company has no obligation to provide  medical or life insurance
    coverage to retired  employees  under the Company  ERISA Plans,  the Company
    Benefit  Arrangements or any other plan or agreement.  No Company ERISA Plan
    is a  "multi-employer  plan" as defined in  Section  3(37) of ERISA,  and no
    Company ERISA Plan promises or provides post-retirement medical benefit.

          4.10    Company Contracts.  Set forth in Schedule 4.10 is a list, as
    of the date hereof, of the following agreements (the "Company Contracts"):

                (a) Each  agreement  to which the  Company is a party  requiring
    payment in excess of $50,000 per year except  those that are  terminable  at
    the option of the Company upon less than thirty (30) days notice;

                (b) Each  agreement  covering the lease,  purchase or service of
    tangible  personal  property  to  which  the  Company  is a party  requiring
    payments in excess of $l0,000 per year;

                (c) Each  agreement to which the Company is a party with respect
    to indebtedness for money borrowed, including letters of credit, guaranties,
    indentures, swaps and similar agreements;

                (d)  Each   management,   consulting,   employment,   severance,
    collective  bargaining or similar agreement,  and each employment,  to which
    the Company is a party;

                (e)  Each  agreement with any  manufacturer's  representative,
    distributor or sales agent; and

                (f)  Each  agreement  between  the  Company  and Seller or its
    Affiliates.

    Each  of  the  Company  Contracts  is  valid,  binding  and  enforceable  in
    accordance with its terms,  except as limited by any applicable  bankruptcy,
    reorganization,  insolvency,  moratorium or other similar laws affecting the
    enforcement  of creditors'  rights  generally  and to general  principles of
    equity  (whether or not considered in a court of law or equity),  and are in
    full  force and  effect.  There are no  existing  material  defaults  by the
    Company  under any of the Company  Contracts.  No event has  occurred  which
    (whether  with  or  without  notice,  lapse  of  time  or the  happening  or
    occurrence of any other event) would constitute a material default under any
    of the Company Contracts by any party thereto.

          4.11 Legal  Proceedings.  Except as set forth in Schedule 4 11,  there
    are no Actions instituted or pending,  or, to Seller's Knowledge  threatened
    or  anticipated,  against the Company or to which the Company is a party, or
    against any  property,  asset,  interest or right of the Company.  Except as
    disclosed  on  Schedule 4 11, the  Company is not  subject to any Order that
    would have a Material Adverse Effect on the Company.

          4.12 Year 2000  Compliance.  The Company  has adopted and  implemented
    commercially  reasonably  measures to investigate and correct any "year 2000
    problems" associated with the operation of the Company's business.

          4.13 Compliance  with Laws.  Except as set forth in Schedule 4.13, the
    Company:  (a) is in compliance with all Laws and Orders applicable to it and
    (b)  since  January  1,  1997,  has  received  no  written  notification  or
    communication from any Governmental Authority (i) asserting that the Company
    is not in compliance  with any Law or (ii)  threatening to revoke any Permit
    of any Governmental Authority.

          4.14    Environmental Matters. Except as set forth in Schedule 4.14:

                (a)  The  Company  has  complied  with  all  of  the  terms  and
    conditions  of all Permits which are required  under,  and has complied with
    all other limitations,  restrictions,  conditions, standards,  prohibitions,
    requirements,  obligations, schedules and timetables which are contained in,
    all federal, state and local Laws relating to pollution or protection of the
    environment,  including Laws relating to emissions,  discharges, releases or
    threatened releases of pollutants,  contaminants,  or any other materials or
    wastes  including  "hazardous  substances" as defined in 42 U.S.C. ss. 9601,
    petroleum  or any  constituent  thereof and any  hazardous or solid waste as
    defined in 42 U.S.C. ss. 6903 ("Hazardous Substances"") into the environment
    (including  ambient air, surface water,  ground water or lands) or otherwise
    regulating  the  manufacture,   processing,  distribution,  use,  treatment,
    storage,   disposal,   transport   or  handling  of   Hazardous   Substances
    (Environmental Laws").

                (b) Since  October 1, 1989,  the  Company has not  received  any
    written notice of a charge,  complaint,  action, suit, proceeding,  hearing,
    investigation, claim, demand or notice alleging any liability of the Company
    or any  failure  by  the  Company  to  comply  with  any  Environmental  Law
    ("Environmental  Claim") and any disputes resulting from any notice received
    prior to such date have been resolved.

          4.15    Intellectual Property.

                (a) Schedule  4.15 sets forth a complete and correct list of all
    patented or registered Intellectual Property and pending patent applications
    or other  applications for  registrations of Intellectual  Property owned or
    filed by or on behalf of the Company and any other Intellectual Property the
    Company currently uses in connection with its business.

                (b) Except as set forth on Schedule  4.15 (i) the  Company  owns
    and  possesses  all right,  title and  interest  in and to, or, to  Seller's
    Knowledge,  has a valid and  enforceable  license to use,  the  Intellectual
    Property  currently used in the operation of the Company's business and (ii)
    since  January 1, 1997,  the  Company  has not  received  any notices of any
    infringement or misappropriation  by, or conflict with, any third party with
    respect  to the  Intellectual  Property  or any third  party's  intellectual
    property rights and any disputes resulting from any notice received prior to
    such date have been resolved.

                (c)   "Intellectual   Property"   means  all   patents,   patent
    applications,   patent  licenses,  software  licenses,  know-how,  licenses,
    trademarks,   copyrights,   service  marks,   trademark   registrations  and
    applications,   copyright  registrations  and  applications,   service  mark
    registrations  and applications and all other intangible  property rights or
    technology owned or used by the Company in the operation of its businesses.

          4.16    No  Brokers.  Except for the  compensation  payable to W. Y.
    Campbell  &  Company  ("Campbell")  in  connection  with the  transactions
    contemplated by this Agreement,  which is to be paid by Seller, no broker,
    finder or  similar  agent has been  employed  by or on behalf of Seller or
    the  Company,  and no Person with which Seller or the Company have had any
    dealings or  communications of any kind other than Campbell is entitled to
    any  brokerage  commission,  finder's fee or any similar  compensation  in
    connection with this Agreement or the transactions contemplated hereby.

          4.17 Company  Employees.  Schedule  4.17 sets forth a complete list of
    all current employees of the Company and their annualized rates of pay as of
    September  1, 1999 and since  that date  there  have been no  changes in the
    annual rates of pay of any employees.  To Seller's  Knowledge and except for
    those efforts made in 1998 in  connection  with the tender offer for Seller,
    there  has  not  been  since  January  1,  1997  any  effort  by  any  labor
    organization to organize into a collective  bargaining unit any employees of
    the Company.

          4.18    Bank  Accounts.  Schedule  4.18 is an  accurate  list of all
    bank  accounts  maintained by the Company and the  authorized  signatories
    therefor.

                                    ARTICLE V

                   REPRESENTATIONS AND WARRANTIES OF BUYER

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

          5.1           Investment  Intent. The Shares are being purchased for
    its own  account  and not with the view to, or for  resale  in  connection
    with, any  distribution or public  offering  thereof within the meaning of
    the Securities Act of 1933.

          5.2 Organization and Standing.  Buyer is a corporation duly organized,
    validly  existing and in good standing under the laws of its jurisdiction of
    incorporation  and has the requisite  corporate  power and authority to own,
    operate and lease its  properties  and to carry on its business as presently
    being conducted.

          5.3  Authorization,  Validity  and  Effect  Buyer  has  the  requisite
    corporate  power and authority to execute and deliver this Agreement and all
    agreements and documents contemplated hereby to be executed and delivered by
    it, and to consummate the transactions  contemplated hereby and thereby. The
    execution  and  delivery of this  Agreement  and such other  agreements  and
    documents, and the consummation of the transactions  contemplated herein and
    therein,  have been duly and validly  authorized by all necessary  corporate
    action in  respect  thereof  on the part of Buyer.  This  Agreement  and all
    agreements  and  documents  contemplated  hereby  has been duly and  validly
    executed and delivered by Buyer and represents the legal,  valid and binding
    obligation of Buyer,  enforceable against Buyer in accordance with its terms
    except as limited by (a) applicable bankruptcy, reorganization,  insolvency,
    moratorium or other similar laws  affecting  the  enforcement  of creditors'
    rights  generally  from time to time in effect and (b) the  availability  of
    equitable remedies (regardless of whether  enforceability is considered in a
    proceeding at law or in equity).

          5.4   No Conflict;  Required Filings and Consents.

                (a) Neither the  execution  and  delivery of this  Agreement  by
    Buyer,  nor the  consummation  by  Buyer  of the  transactions  contemplated
    herein, nor compliance by Buyer with any of the provisions hereof,  will (i)
    conflict  with or result in a breach of any  provision  of the  Articles  of
    Incorporation  or By-laws or equivalent  organizational  documents of Buyer,
    (ii) constitute or result in the breach of any term,  condition or provision
    of, or constitute a default under, or give rise to any right of termination,
    cancellation or  acceleration  with respect to, or result in the creation or
    imposition of any Lien upon, any property or assets of Buyer or, pursuant to
    any note, bond,  mortgage,  indenture,  license,  agreement,  lease or other
    instrument or obligation to which it is a party or by which it or any of its
    properties or assets may be subject, and that would, in any such event, have
    a  Material  Adverse  Effect on Buyer,  or (iii)  subject  to receipt of the
    requisite  approvals referred to in Schedule 5.4(b), to the actual knowledge
    of the executive officers of Buyer ("Buyer's Knowledge"),  violate any Order
    or Law applicable to Buyer or any of its properties or assets,

                (b) Other than (i) notices  under the HSR Act, (ii) as set forth
    in Schedule  5.4(b) and (iii) where the  failure to give such  notice,  make
    such filing, or receive such  authorization,  exemption or Consent would not
    have a  Material  Adverse  Effect  on  Buyer,  no notice  to,  filing  with,
    authorization  of, or exemption by, or Consent of any Person or Governmental
    Authority is necessary  for the  consummation  by Buyer of the  transactions
    contemplated in this Agreement.

          5.5 Legal Proceedings.  Except as set forth in Schedule 5.5, there are
    no Actions  instituted  or  pending,  or to Buyer's  Knowledge,  threatened,
    against  Buyer,  or against  any of its  properties,  assets,  interests  or
    rights,  that  would  interfere  with  or  delay  the  consummation  of  the
    transactions  contemplated  by this  Agreement.  Buyer is not subject to any
    Order that would have a Material Adverse Effect on Buyer.

          5.6 No Brokers.  No broker,  finder or similar agent has been employed
    by or on  behalf  of  Buyer,  and no  Person  with  which  Buyer has had any
    dealings  or  communications  of any  kind  is  entitled  to  any  brokerage
    commission, finder's fee or any similar compensation in connection with this
    Agreement or the transactions contemplated hereby.

          5.7     Buyer's  Financing.  Buyer has sufficient funds available to
    consummate the transactions  contemplated  hereby and pay all related fees
    and expenses.

          5.8 Financial  Information.  Buyer has made available to Seller copies
    of  the  audited   consolidated   financial  statements  of  Buyer  and  its
    Subsidiaries  as of and for the  period  ended  December  31,  1997 and 1998
    accompanied by the reports thereon of Buyer's independent public accountants
    (the "Buyer  Financials").  Since  December  31, 1998,  no Material  Adverse
    Effect has occurred with respect to Buyer.

          5.9 No  Reliance.  The  purchase  of  the  Shares  by  Buyer  and  the
    consummation  of the  transactions  contemplated  hereunder by Buyer are not
    done in reliance  upon any  warranty or  representation  by, or  information
    from,  Seller  or the  Company  of any sort,  oral or  written,  except  the
    warranties  and  representations  specifically  set forth in this  Agreement
    (including  the  schedules  and  exhibits  hereto)  and in any  certificates
    required to be delivered to Buyer by Seller hereunder and thereunder.

                                   ARTICLE VI

                            COVENANTS AND AGREEMENTS

          6.1 Interim  Operation of the Company.  From the date hereof until the
    Closing  Date,  except  as  contemplated  by any  other  provision  of  this
    Agreement  or as set forth in  Schedule  6.1,  unless  Buyer has  previously
    consented in writing  thereto,  Seller shall cause the Company to operate in
    the ordinary course of business and Seller shall cause the Company not to:

                (a)  incur any indebtedness or issue any debt securities or
    assume, guarantee or endorse the obligations of any other Persons,:
    except for indebtedness incurred in the ordinary course of business
    consistent with past practice;

                (b)  except  in the  ordinary  course of  business  consistent
    with past practice, acquire or dispose of any material assets;

                (c) enter into any agreements,  commitments or contracts, except
    agreements, commitments or contracts made in the ordinary course of business
    consistent with past practice;

                (d) except in the ordinary  course of business  consistent  with
    past practice,  engage in any transactions with, or enter into any contracts
    or agreements with any Affiliates of the Company;

                (e) enter into, adopt, amend or terminate any agreement relating
    to the  compensation  or  severance  of any  employee  associated  with  the
    Company,  except to the extent required by Law, any existing  agreements and
    for the agreement with John Bender in the form delivered to Buyer on October
    12, 1999;

                (f)  make any  material  change to its  accounting  (including
    tax  accounting)  methods,  principles  or  practices,  except  as  may be
    required by GAAP;

                (g)  make any amendment to its Articles of Incorporation or
    By-laws;

                (h)  issue or sell any capital stock of the Company or split,
    combine or subdivide the capital stock of the Company; or

                (i)  agree to take any of the actions described in
    sub-clauses (a) through (h) above.

          6.2     Reasonable Access; Confidentiality

                (a) From the date hereof until the  Closing,  Seller shall cause
    the Company to give Buyer and its representatives  (including its attorneys,
    agents and lenders or other sources of financing), upon reasonable notice to
    the Company,  reasonable access to the assets,  properties,  books, records,
    agreements,  employees  and  commitments  of the Company and shall cause the
    Company  to  permit  Buyer to make  such  inspections  as it may  reasonably
    require and to furnish  Buyer  during such period with all such  information
    relating to the Company as Buyer may from time to time reasonably request.

                (b) Any information provided to or obtained by Buyer pursuant to
    paragraph (a) above is  "Information"  as defined under the  Confidentiality
    Agreement,  dated  July  16,  1999,  between  the  Company  and  Buyer  (the
    "Confidentiality Agreement'),, and is to be held by Buyer in accordance with
    and be subject to the terms of the Confidentiality Agreement.

                (c) Buyer  agrees to be bound by and comply with the  provisions
    set forth in the  Confidentiality  Agreement as if such  provisions were set
    forth  herein,  and  such  provisions  are  hereby  incorporated  herein  by
    reference.

          6.3  Filings;  Other  Action.  Subject  to the  terms  and  conditions
    provided  herein,  Seller and Buyer shall (a) promptly make their respective
    filings and  thereafter  make any other required  submissions  under the HSR
    Act; (b) use their  reasonable  best efforts to cooperate with each other in
    (i)  determining  which filings are required to be made prior to the Closing
    Date with,  and which  Consents  are  required to be  obtained  prior to the
    Closing Date from, Governmental Authorities in connection with the execution
    and delivery of this  Agreement  and the  consummation  of the  transactions
    contemplated  hereby  and (ii)  timely  making all such  filings  and timely
    seeking all such  Consents;  and (c) use their  reasonable  best  efforts to
    cause the conditions to each of Seller's and Buyer's  obligations  hereunder
    to be fulfilled.

          6.4  Publicity.  Seller  and Buyer  shall make a joint  press  release
    announcing the execution of this Agreement and the transactions contemplated
    hereby,  which is to be  acceptable  to each of Seller and Buyer;  provided,
    however,  that such press release and any other public  disclosure by Seller
    or Buyer of this Agreement or the transactions contemplated hereby is not to
    disclose the Purchase  Price unless such  disclosure  is required by Law. No
    other  publicity   release  or  announcement   concerning  the  transactions
    contemplated  hereby is to be issued by either  party  without  the  advance
    written consent of such other party, except any such release or announcement
    as may be required by applicable Law.

          6.5 Records.  With respect to the financial  books and records  (other
    than Tax records  which are provided for in Section 6.6) and minute books of
    the  Company  relating  to matters on or prior to the  Closing  Date,  for a
    period of ten years after the Closing Date,  neither  Seller nor Buyer shall
    cause or permit their  destruction  or disposal  without  first  offering to
    surrender them to Buyer or Seller as appropriate, and Seller and Buyer shall
    allow Buyer and Seller and his  representatives,  as appropriate,  access to
    such books and records during regular business hours.

          6.6     Tax Matters. From and after the Closing:

                (a) Seller and Buyer shall (i) each  provide the other and shall
    cause their respective  accountants to provide the other party's accountant,
    and Buyer shall cause the Company to provide Seller, with such assistance as
    may  reasonably  be  requested  by  any  of  them  in  connection  with  the
    preparation  of any  Tax  Return,  or the  conduct  of any  audit  or  other
    examination   by  any  taxing   authority  or  judicial  or   administrative
    proceedings  relating to liability  for Taxes;  (ii) each retain and provide
    the other and shall cause their respective  accountants to provide the other
    party's accountant,  and Buyer shall cause the Company to retain and provide
    Seller with, any records or other  information  that may be relevant to such
    Tax Return,  audit or examination,  proceeding or  determination;  and (iii)
    each  provide  the other with any final  determination  of any such audit or
    examination, proceeding or determination that affects any amount required to
    be shown on any Tax Return of the other for any period. Without limiting the
    generality of the foregoing, Buyer shall retain, and shall cause the Company
    to  retain,  and  Seller  shall  retain,  until the  applicable  statute  of
    limitations  (including  any  extensions)  have  expired,  copies of all Tax
    Returns,  supporting work schedules,  and other records or information  that
    may be  relevant to such  returns  for all Tax  periods or portions  thereof
    ending  before or  including  the Closing and shall not destroy or otherwise
    dispose of any such records  without first  providing the other party with a
    reasonable  opportunity  to review  and copy same at the cost of such  other
    party.

                (b)  Seller  shall  prepare  and file  income Tax  Returns  with
    respect to the Company for all periods  commencing prior to and ending on or
    before the Closing  Date.  Seller  shall pay all Taxes  described in Section
    8.2(a)(vi).  Buyer shall pay all Taxes of the  Company for all periods  that
    begin after the  Closing  Date,  and shall  prepare and file all Tax Returns
    with  respect to the Company for all  periods  commencing  after the Closing
    Date and ending thereafter.

                (c) Seller and Buyer shall each pay fifty  percent  (50%) of any
    state and local sales and stock transfer  taxes and all recording  costs and
    fees however styled or designated that are required to be paid in connection
    with the transfer of the Shares contemplated by this Agreement.

                (d) Seller and Buyer shall  provide to each other prompt  notice
    of, and as requested by the other party  reasonable  cooperation  in respect
    of, any audit or similar  investigation  or proceeding in which the Internal
    Revenue  Service or any other  Governmental  Authority  makes or proposes to
    make a Tax  adjustment to any Tax period of the Company  ending on or before
    the Closing Date.

                (e)  Buyer  and  Seller  shall  make a  timely,  effective,  and
    irrevocable  election  under  Section  338(h)(10)  of the Code and under any
    comparable  statutes in any other  jurisdiction with respect to the purchase
    of  the  Shares  of  the  Company  (collectively,  the  "Section  338(h)(10)
    Election"),  and  to  file  that  election  in  accordance  with  applicable
    regulations. The Section 338(h)(10) Election will allocate the modified ADSP
    (as that term is defined in Treasury Regulations Section  1.338(h)(10)-1(f))
    of the assets of the Company in  accordance  with the  Treasury  regulations
    promulgated  under Section  338(h)(l0).  Neither Buyer nor Seller nor any of
    their respective Affiliates shall take any action inconsistent with, or fail
    to take  any  action  necessary  for  the  validity  of the  ss.  338(h)(10)
    Election,  and shall utilize the asset values determined from the Allocation
    Agreement  (as  defined in Section  6.7) for the  purpose of all tax returns
    filed and shall not take any action inconsistent  therewith upon examination
    of any tax return,  in any refund claim, in any litigation,  or otherwise in
    respect to such returns.

          6.7  Allocation  Matters.  The parties shall use their best efforts to
    enter into an agreement  (the  "Allocation  Agreement")  as soon as possible
    after the final  determination of the purchase price allocating the Purchase
    Price among the assets and  liabilities of the Company.  Buyer shall deliver
    to Seller a proposed  Allocation  Agreement within sixty (60) days after the
    signing  of this  agreement.  If Seller  has not  objected  to the  proposed
    Allocation  Agreement within thirty (30) days after receipt,  such agreement
    shall be accepted and shall be the Allocation Agreement.

                If Seller  objects to  Buyer's  proposed  Allocation  Agreement.
    Seller  shall give Buyer  written  notice of the  objections  and Seller and
    Buyer shall use  reasonable  efforts to resolve the  differences.  If within
    thirty (30) days after the date on which  Seller has given  Buyer  notice of
    its objections,  the parties have not adopted the Allocation Agreement,  any
    dispute related thereto shall be referred to an independent  accounting firm
    selected by the parties and resolved  thirty (30) days after such  referral.
    The  independent  accounting  firm's  determination  shall be conclusive and
    binding upon Buyer and Seller and its Affiliates  except as provided  below.
    The costs,  expenses,  and fees of the independent  accounting firm shall be
    borne equally by the parties.

                The value  assigned to the building and land located at 625 W.
    Columbian Blvd. (a.k.a. 1 Sierra Place), Litchfield, IL shall be $912,000.

                Buyer will  prepare IRS Form 8023 and deliver the form to Seller
    no later than sixty (60) days prior to its due date.  Seller will review and
    complete  Section F ("Seller's  Statement") of Form 8023, sign and return to
    Buyer no later than thirty (30) days prior to Form 8023's due date.

          6.8 NAPA Business Practices. For one year following the Closing, Buyer
    shall  cause the  Company to  continue  the  business  practices  (the "NAPA
    Business  Practices")  formerly  employed  by the  Company as a supplier  of
    products to NAPA,  including,  without limitation,  the following practices:
    (a) the Company  shall  continue to supply NAPA  products  requested by NAPA
    within  forty  eight (48) hours after the order has been  received,  (b) the
    Company shall accept returns of products  supplied by the Company to NAPA in
    an amount  not more than two  percentage  points  above the  average  amount
    expressed as a percentage  accepted by the Company in the fiscal years 1996,
    1997 and 1998,  and (c) for all invoices paid by NAPA within sixty (60) days
    of  shipment,  NAPA will be entitled  to take a 2% discount  off the invoice
    price.  Notwithstanding  the  foregoing,  if NAPA  amends  any of the  above
    described  practices or any other NAPA Business Practice,  Buyer shall cause
    the Company to negotiate in good faith with NAPA regarding such changes.

          6.9     Non-Competition.

                (a) For a period of two (2) years from the Closing Date,  Seller
    shall not and shall cause its Affiliates not to (i) acquire or invest in any
    business that competes with the Business within the Restricted Territory; or
    (ii) sell any Current  Products to any Current  Customers  or to any Current
    Competitors within the Restricted Territory.

                (b) The provisions of Section  6.9(a) do not prohibit  Seller or
    its  Affiliates  from (i)  acquiring  another  Person  engaged in activities
    prohibited by Section 6.9(a) if at the time of the  acquisition the business
    of the Person  acquired  otherwise  prohibited by Section 6.9(a)  represents
    less than 20% of such  Person's  consolidated  sales  for its most  recently
    completed  fiscal  year,  (ii)  acquiring  up to  five  percent  (5%) of the
    securities  of any  Person  which is  engaged in  activities  prohibited  by
    Section  6.9(a) if the  securities  of such  Person are listed on a national
    securities  exchange  or  the  NASDAQ  Automated  Quotation  System,   (iii)
    performing the obligations set forth in the Transitional Services Agreement,
    or (iv) engaging in any business  activity in which Seller or its Affiliates
    (other than the Company) are currently  engaged with any Person,  whether or
    not such Person is a Current Customer or a Current Competitor.

                (c) Seller  acknowledges  that its  failure to comply  with this
    Section 6.9 will  irreparably harm Buyer and Buyer will not have an adequate
    remedy  at  law in the  event  of  such  non-compliance.  Therefore,  Seller
    acknowledges  that  Buyer  will be  entitled  to  injunctive  relief  and/or
    specific performance, in addition to whatever other remedies it may have, at
    law or in equity,  against any acts of  non-compliance  by Seller under this
    Section 6.9.

          6.10 Accounts  Receivable.  If, following the Closing Date,  Seller or
    any of its  Affiliates  (other than the  Company)  receive  any  payments of
    accounts  receivable  relating to the  Company,  such  payments  will be the
    property of, and will be immediately forwarded and remitted to, the Company.

                                   ARTICLE VII

                              CONDITIONS TO CLOSING

          7.1  Conditions to  Obligations  of Seller and Buyer.  The  respective
    obligations of Seller and Buyer to consummate the transactions  contemplated
    by this Agreement shall be subject to the satisfaction or waiver at or prior
    to the Closing of each of the following conditions:

                (a) The waiting  period  applicable to the  consummation  of the
    transactions  contemplated  by this  Agreement  under the HSR Act shall have
    expired or been terminated.

                (b) None of the parties  hereto shall be subject to any Order of
    a court of competent  jurisdiction  that prohibits the  consummation  of the
    transactions  contemplated  by this  Agreement.  In the event any such Order
    shall have been issued, each party agrees to use its reasonable best efforts
    to have any such Order overturned or lifted.

          7.2  Conditions to Obligation of Seller.  The  obligation of Seller to
    consummate the transactions  contemplated by this Agreement shall be subject
    to the  satisfaction  or  waiver at or prior to the  Closing  of each of the
    following additional conditions:

                (a) The  representations,  warranties and any  certification  or
    instrument  delivered  pursuant to this Agreement of Buyer set forth in this
    Agreement  shall be true and correct in all  respects as of the Closing Date
    as though  made on and as of the  Closing  Date  (except to the extent  such
    representations and warranties speak as of an earlier date).

                (b)  Each  of  the  agreements  and  covenants  of  Buyer  to be
    performed and complied with by Buyer pursuant to this Agreement prior to the
    Closing  Date  shall  have  been duly  performed  and  complied  with in all
    material respects.

                (c) Buyer shall have delivered to Seller a certificate, dated as
    of the Closing Date and signed on its behalf by its chief executive  officer
    and  its  chief  financial  officer,  as to  the  satisfaction  by it of the
    conditions set forth in Sections 7.2(a) and 7.2(b).

                (d) Buyer shall have assumed all  obligations  of Dana under the
    Employee  Retention  Incentive  Agreements  other than those relating to the
    payment of the Retention Incentive Payments and the Divestiture  Payments as
    defined in the Employee Retention Incentive Agreements.

                (e)  The Company shall have assumed all obligations under the
    Clearwater Lease.

                (f) The Company shall have entered into a lease  agreement  with
    Hewlett Packard Company as described in Schedule 4.8(d)(ii).

                (g)  Buyer  shall  have  delivered  the  Purchase  Price and the
    documents required to be delivered by Buyer pursuant to Section 3.3.

          7.3  Conditions  to Obligation  of Buyer.  The  obligation of Buyer to
    consummate the transactions  contemplated by this Agreement shall be subject
    to the  satisfaction  or waiver at or prior to the Closing of the  following
    conditions:

                (a) The  representations  and  warranties of Seller set forth in
    this  Agreement  shall be true and correct in all respects as of the Closing
    Date as though made on and as of the Closing Date (except to the extent such
    representations and warranties speak as of an earlier date).

                (b)  Each  of the  agreements  and  covenants  of  Seller  to be
    performed and complied with by Seller  pursuant to this  Agreement  prior to
    the Closing Date shall have been duly  performed  and  complied  with in all
    material respects.

(c)   Seller shall have assigned its rights under the Clearwater  Lease to the
                     Company.

                (d) Seller shall have delivered to Buyer a certificate, dated as
    of the Closing Date, as to the  satisfaction by Seller of the conditions set
    forth in subsections 7.3(a) and 7.3(b).

                (e) Between the date of this  Agreement and the Closing Date, no
    change or event shall have occurred which has had a Material  Adverse Effect
    on the Company.

                (f) Seller shall have delivered to Buyer the documents  required
    to be delivered by Seller pursuant to Section 3.2.

                                  ARTICLE VIII

                          SURVIVAL AND INDEMNIFICATION

          8.1  Survival  Periods.  The  representations  and  warranties  of the
    parties contained in this Agreement will survive the Closing until 18 months
    from the Closing Date (the "Expiration Date");  provided,  however, that (i)
    the Expiration Date for any claims for indemnification  relating to a breach
    of the  representations  and warranties set forth in Section 4.7 (Taxes) and
    Section  4.9  (Employee  Benefit  Plans)  will  be  the  expiration  of  all
    applicable  periods  prescribed  under statutes of limitation and (ii) there
    will be no Expiration Date (other than the applicable statute of limitation)
    for the representations and warranties  contained in Section 4.3 and Section
    4.4. The  covenants and  agreements of the parties  hereto shall survive the
    Closing in accordance with their terms.  No party providing  indemnification
    pursuant to this  Article  VIII (an  "Indemnifying  Party") is  obligated to
    provide  such  indemnification  with  respect  to  the  representations  and
    warranties  to  the  other  party  (the  "Indemnified   Party")  unless  the
    Indemnified   Party  has   delivered   written   notice  of  its  claim  for
    indemnification  prior to the Expiration Date; provided,  however,  that any
    claim for indemnification for which a notice has been given on or before the
    Expiration  Date may continue to be asserted and  indemnified  against until
    finally resolved.

          8.2     Indemnification,  Subject  to the other  provisions  of this
    Article VIII, from and after the Closing,

                (a) Seller  shall  indemnify  and hold Buyer  harmless  from and
    against  any  costs or  expenses  (including  reasonable  attorneys'  fees),
    judgments,  fines,  losses,  claims and  damages  (collectively,  "Damages")
    resulting  from (i) any breach of any  representation  or  warranty  made by
    Seller in this  Agreement;  (ii) the  failure  to  perform  or breach of any
    covenant or agreement made by Seller under this Agreement; (iii) liabilities
    associated with Company ERISA Plans or Company Benefit Plans;  (iv) personal
    injury or property  damage  claims  arising  from or related to any products
    distributed  by the Company to the extent that the injury or damage to which
    such claims relate  occurred  prior to the Closing Date and resulted from or
    is alleged to have resulted from products sold or services  performed by the
    Company  prior  to the  Closing  Date;  (v) the  failure  of Dana to pay the
    employees of the Company who are party to the Employee  Retention  Incentive
    Agreements the Retention Incentive Payments and the Divestiture  Payments as
    defined  in the  Employee  Retention  Incentive  Agreements,  or (vi)  Taxes
    (including  income Taxes payable as a result of the  application of Treasury
    Regulation  ss.  1.1502-6)  attributable  to the Company (and its Affiliates
    included  with the Company in the filing of a  Consolidated  Tax Return) for
    tax  periods  ending  on or prior to the  Closing  Date  including  any gain
    recognized as a result of the Section  338(h)( 10) Election  provided for in
    Section 6.6(e).

                (b) Buyer  shall  indemnify  and hold Seller  harmless  from and
    against all Damages to the extent they are the result from (i) any breach of
    any  representation  or warranty  made by Buyer in this  Agreement  (ii) the
    failure to  perform or breach of any  covenant  or  agreement  made by Buyer
    under this Agreement or (iii) any Taxes for tax periods  beginning after the
    Closing Date.

                (c) For  the  avoidance  of  doubt,  the  Expiration  Date,  the
    Deductible   and  the  Cap  will  not  apply  to  Seller's   indemnification
    obligations  under  Section  8.2(a)(ii),  (iii),  (iv),  (v) or (vi) even if
    claims for  indemnification  under those  sections  might also be made under
    Section 8.2(a)(i).

          8.3  Indemnification  Amounts.  Notwithstanding  any  provision to the
    contrary  contained  in this  Agreement,  Seller  will not be  obligated  to
    indemnify Buyer for any Damages  resulting from a breach of a representation
    or  warranty   (other  than   Damages   resulting   from  a  breach  of  the
    representations or warranties contained in Section 4.3 and Section 4.4) made
    by  Seller  (a)  unless  and until the  amount of all such  Damages  exceeds
    $500,000 (the  "Deductible"),  in which event, Buyer may assert its right to
    indemnification  only  for  the  amount  of the  Damages  in  excess  of the
    Deductible  (subject  to clause (b)  below),  and (b) to the extent that the
    aggregate  amount of all such  payments for Damages to Buyer does not exceed
    $17,000,000 ("Cap").

          8.4     Claims.

                (a) If an  Indemnified  Party  intends  to seek  indemnification
    pursuant to this Article VIII, such Indemnified  Party shall promptly notify
    the  Indemnifying  Party in writing of such claim  describing  such claim in
    reasonable  detail;  provided,  that the failure to provide such notice will
    not affect the obligations of the  Indemnifying  Party unless it is actually
    prejudiced  thereby,  subject,  however,  to the time  periods  specified in
    Section 8.1 hereof.  If such claim involves a claim by a third party against
    the Indemnified  Party,  the  Indemnifying  Party will have thirty (30) days
    after receipt of such notice to decide  whether it will  undertake,  conduct
    and control, through counsel of its own choosing and at its own expense, the
    settlement or defense thereof,  and if it so decides,  the Indemnified Party
    shall  cooperate  with  it  in  connection  therewith;  provided,  that  the
    Indemnified  Party may  participate  in such  settlement or defense  through
    counsel  chosen by it; and provided  further,  that the fees and expenses of
    such  counsel are to be borne by the  Indemnified  Party.  The  Indemnifying
    Party  shall not,  without  the written  consent of the  Indemnified  Party,
    settle or  compromise  any action in any manner  that would  materially  and
    adversely affect the Indemnified  Party. If the Indemnifying  Party does not
    notify the  Indemnified  Party within  thirty (30) days after the receipt of
    the  Indemnified  Party's  notice of a claim of indemnity  hereunder that it
    elects to undertake the defense thereof, the Indemnified Party will have the
    right to contest, settle or compromise the claim but shall not thereby waive
    any right to indemnity  therefor pursuant to this Agreement.  As long as the
    Indemnifying  Party  is  contesting  any  such  claim  in  good  faith,  the
    Indemnified  Party shall not pay or settle any such  claim.  Notwithstanding
    the foregoing, the Indemnified Party has the right to pay or settle any such
    claim;  provided,  that the Indemnified Party has delivered the Indemnifying
    Party reasonable advance notice of any proposed settlement or payment.

                (b) The  Indemnified  Party shall cooperate fully in all aspects
    of any  investigation,  defense,  pretrial  activities,  trial,  compromise,
    settlement or discharge of any claim in respect of which indemnity is sought
    pursuant to Article  VIII,  including,  but not limited to, by providing the
    other party with reasonable  access to employees and officers  (including as
    witnesses) and other information.

          8.5 Exclusive Remedy. The  indemnification  provisions of this Article
    VIII are the  exclusive  remedy  following  the Closing for any  breaches or
    alleged breaches of any representation,  warranty or other provision of this
    Agreement or the transactions contemplated hereby and, without limitation on
    the  foregoing,  Buyer  hereby  waives  any and all  rights  that are or may
    otherwise be available to it at law or equity in respect of the purchase and
    sale of the Shares. Buyer has no right to set-off against any payments to be
    made by Buyer pursuant to this  Agreement or otherwise.  Each of the parties
    hereto,  on  behalf  of  itself  and  its  officers,  directors,  employees,
    shareholders, partners, affiliates, agents or representatives (collectively,
    such  party's   "Representatives")  agrees  not  to  bring  any  actions  or
    proceedings,  at law,  equity or  otherwise,  against any other party or its
    Representatives,  in respect of any  breaches  or  alleged  breaches  of any
    representation,  warranty  or  other  provision  of this  Agreement,  except
    pursuant to the express  provisions of this Article VIII. The parties hereby
    acknowledge  that no  party  has made any  representations  and  warranties,
    express  or  implied,   with  respect  to  this  Agreement  or  the  matters
    contemplated hereby, except as explicitly set forth in this Agreement.

          8.6 Tax and  Insurance.  The  amount  of any  Damages  suffered  by an
    Indemnified  Party is to be  reduced  by any net tax,  insurance  or:  other
    benefits  that such  party  receives  in  respect  of or as a result of such
    Damages or the facts or circumstances  relating thereto,  If any Damages for
    which  indemnification is provided hereunder are subsequently reduced by any
    net tax benefit, insurance payment or other recovery from a third party, the
    amount of such reduction is to be remitted to the Indemnifying Party.

                                   ARTICLE IX

                          EMPLOYEE AND BENEFIT MATTERS

          9.1  Employment.  Buyer shall cause the Company to continue to employ,
    on the terms  required  by this  Article  IX, for a period of six (6) months
    after the  Closing  Date all  individuals  who are  employed  by the Company
    immediately  prior to the Closing Date,  including those who are on lay-off,
    leave of  absence,  or  short-term  disability  as set forth on Schedule 9 1
    (collectively "Continuing Employees"),  provided that the foregoing,  except
    as otherwise required by the Employee Retention Incentive  Agreements,  does
    not require Buyer to cause the Company to continue to employ any  Continuing
    Employee  who  resigns  or  otherwise  voluntarily  terminates  his  or  her
    employment with the Company or who is terminated by the Company for cause.

          9.2            Compensation and Employee Benefits.

                (a) In General. Subject to the provisions of Section 9.2(c), for
    a period of six (6) months  after the  Closing  Date,  Buyer shall cause the
    Company  to provide  each  Continuing  Employee  compensation  and  employee
    benefits  which,  in the aggregate,  are  substantially  equivalent to those
    provided by Buyer to similarly situated  employees  immediately prior to the
    Closing  Date.  Subject to the  foregoing  and the other  provisions of this
    Article  IX  and  the  provisions  of  the  Employee   Retention   Incentive
    Agreements,  Buyer has the right to determine the  compensation and employee
    benefits of the Continuing Employees.

                (b) Service Credit.  For purposes of any employee  benefit plan,
    program or  arrangement  established  for or made  available  to  Continuing
    Employees by the Company or Buyer (the "Buyer Plans"), Buyer shall, or shall
    cause the Company to, credit such Continuing  Employees with service for all
    periods of service prior to the Closing Date with Seller, the Company or any
    Affiliate  of either  Seller or the Company  except that Buyer shall have no
    obligation  to give such  credit to John  Bender  for  purposes  of  Buyer's
    severance  plan.  Such service will be credited for purposes of  determining
    eligibility  for,  vesting in, and the amount of  benefits  under all of the
    Buyer Plans and for all other  purposes  for which  service is either  taken
    into  account or  recognized;  provided,  however,  such service need not be
    credited to the extent that it would  result in  duplication  of coverage or
    benefits.

                (c) Welfare  Benefit Plans.  Until the later of the Closing Date
    or December 31, 1999 ("Cut-Off  Date"),  Seller shall take such steps as are
    reasonably  required  in  order  to  provide  coverage  for  all  Continuing
    Employees and their respective  dependents under the Company ERISA Plans and
    Company  Benefit  Arrangements  which are welfare  benefit  plans within the
    meaning of Section 3(1) of ERISA (the "Seller Welfare  Plans").  Promptly on
    receipt of invoices  therefor in such detail as Seller is able reasonably to
    provide,  Buyer shall reimburse  Seller for all expenses  incurred by Seller
    and its  Affiliates in order for Seller and its  Affiliates to perform their
    obligations under the preceding sentence.  Coverage for Continuing Employees
    and  their  respective  dependents  under  the  Seller  Welfare  Plans  will
    terminate as of the Cut-Off Date. The Buyer Plans which are welfare  benefit
    plans  within the  meaning of Section  3(1) of ERISA (the  "Buyer's  Welfare
    Plans") shall provide coverage and benefits to Continuing Employees (and the
    eligible  dependents of the Continuing  Employees)  beginning on the Cut-off
    Date.  In addition,  no  pre-existing  condition,  limitation,  exclusion or
    waiting period  applicable with respect to any Buyer Welfare Plan will apply
    to any Continuing  Employee to the extent that such limitations,  exclusions
    or waiting periods exceed those in effect under the Seller Welfare Plans.

                (d)  Savings and Pension Plans.

                     (i) Effective as of the Closing  Date,  Seller will, at its
          expense,  cause all  Continuing  Employees  to become  fully vested in
          their  account   balances  under  the  Echlin  Incentive  and  Savings
          Investment Plan (the "Savings Plan") and their accrued  benefits under
          the Pension Plan for Echlin Inc. Employees (the "Pension Plan").

                     (ii) With  respect to each  Continuing  Employee who has an
          outstanding  loan under the  Savings  Plan,  Buyer  shall lend to such
          Continuing Employee, upon execution of a promissory note acceptable to
          Buyer, an amount sufficient to repay such outstanding loan.

          9.3 WARN Act and Severance.  Buyer shall not engage in a "mass layoff'
    or "plant  closing" as defined in the United  States Worker  Adjustment  and
    Retraining  Notification Act (the "WARN Act") without  furnishing the notice
    required by Section 3 of the WARN Act.  Buyer shall  defend,  indemnify  and
    hold harmless  Seller and its Affiliates  from any claims,  charges,  suits,
    demands,  damage,  or liability  arising out of or relating to noncompliance
    with the WARN Act from and after the Closing Date.

                                    ARTICLE X

                            TERMINATION OF AGREEMENT

          10.1  Termination.   Notwithstanding   any  other  provision  of  this
    Agreement, this Agreement may be terminated at any time prior to the Closing
    Date:

                (a)  by mutual written consent of Buyer and Seller;

                (b) by Buyer or Seller,  upon written notice to the other party,
    if the transactions contemplated by this Agreement have not been consummated
    on or prior to a date 3 months from the date of this Agreement (the "Outside
    Date"),  unless such  failure of  consummation  is due to the failure of the
    party  seeking  such  termination  to perform  or  observe  in all  material
    respects the covenants and agreements  hereof to be performed or observed by
    such party;

                (c) by Buyer or Seller,  upon written notice to the other party,
    if a Governmental  Authority of competent  jurisdiction  has issued an Order
    enjoining or otherwise  prohibiting  the  consummation  of the  transactions
    contemplated  by this  Agreement,  and  such  Order  has  become  final  and
    non-appealable;  provided, however, that the party seeking to terminate this
    Agreement  pursuant to this clause (c) has used its reasonable  best efforts
    to remove such Order;

                (d) by  Buyer  or  Seller,  if any  condition  to  such  party's
    obligation to consummate the transactions  contemplated  hereby has not been
    satisfied  as of the  Closing  Date or if  satisfaction  of  such  condition
    becomes  impossible  (other than through the failure of such party to comply
    with its or his  obligations  under this  Agreement) and the other party has
    not waived such condition on or before the Closing Date; or

                (e) by Seller  prior to  October  21,  1999 if  Dana's  Board of
    Directors does not approve this Agreement.

          10.2 Effect of Termination. The termination of this Agreement is to be
    effected  by  delivery of written  notice of such  termination  by the party
    terminating the Agreement to the other party. In the event of termination of
    this Agreement pursuant to Section 10,1, no party will have any liability or
    any  further  obligation  to any other  party,  except as  provided  in this
    Section 10,2 and except that nothing herein shall  release,  or be construed
    as  releasing,  any party  hereto from any  liability or damage to any other
    party  hereto  arising out of the  breaching  party's  willful and  material
    breach in the  performance  of any of its covenants,  agreements,  duties or
    obligations arising under this Agreement.  The obligations of the parties to
    this  Agreement  under  Sections  4.16,  5,6, 6,2 and 11.1 shall survive any
    termination of this Agreement.  If Seller terminates this Agreement pursuant
    to Section 10.1(e) and within one year after such termination  Seller or any
    of its Affiliates enters into any agreement  intended to result in a Control
    Transaction  with any Person  other  than  Buyer,  Dana or their  respective
    Affiliates,  then  promptly  upon the  closing of such  Control  Transaction
    Seller shall pay Buyer a fee of $3,000,000.

                                   ARTICLE XI

                            MISCELLANEOUS AND GENERAL

          11.1 Expenses.  Whether or not the  transactions  contemplated by this
    Agreement  are  consummated,  all costs and expenses  (including  all legal,
    accounting, broker, finder or investment banker fees) incurred in connection
    with this Agreement and the transactions  contemplated hereby are to be paid
    by the party incurring such expenses except as expressly provided herein and
    except  that the filing fee in  connection  with the HSR Act filing is to be
    shared equally by Seller and Buyer.

          11.2  Successors  and Assigns This Agreement is to be binding upon and
    inures to the benefit of the parties hereto and their respective  successors
    and permitted assigns, but is not assignable by any party hereto without the
    prior  written  consent of the other  parties  hereto except that Buyer may,
    upon written notice to Seller,  assign its rights  hereunder to an Affiliate
    of  Buyer,  but  no  such  assignment  shall  relieve  Buyer  of  any of its
    obligations hereunder.

          11.3 No Third Party Beneficiaries. Each party hereto intends that this
    Agreement does not benefit or create any legal or equitable right, remedy or
    claim in or on behalf of any Person other than the parties hereto,  and as a
    result this  Agreement and all of its  provisions and conditions are for the
    sole and  exclusive  benefit  of the  parties  to this  Agreement  and their
    successors and assigns.

          11.4 Notices. Any notice or other communication provided for herein or
    given hereunder to a party hereto will be sufficient if in writing, and sent
    by facsimile transmission  (electronically confirmed),  delivered in person,
    mailed by first class registered or certified mail, postage prepaid, or sent
    by  Federal  Express or other  overnight  courier  of  national  reputation.
    addressed as follows:

                If to Buyer:

                     John Young
                     Colfax Corporation
                     9211 Forest hill Avenue
                     Suite 109
                     Richmond, Virginia 23235
                     Fax: (804) 560-4076

                     with a copy to:

                     Thomas O'Brien
                     Colfax Corporation
                     997 Lenox Drive
                     Suite 111

                     Lawrenceville, New Jersey 08648
                     Fax: (609) 896-7633

                     and to:

                     Walter G. Lohr, Jr.
                     Hogan & Hartson L.L.P.
                     111 South Calvert Street
                     Suite 1600
                     Baltimore, Maryland 21202
                     Fax: (410) 539-6981

                If to Seller:

                     Echlin Inc.
                     c/o Dana Corporation
                     4500 Dorr Street
                     Toledo, Ohio 43697
                     Attn:    General Counsel
                     Fax: (419) 535-4790

                     with a copy to:

                     Jones, Day. Reavis & Pogue
                     North Point
                     901 Lakeside Avenue
                     Cleveland, Ohio 44114
                     Attn:    John P. Dunn, Esq.
                     Fax: (216)579-0212

    or to such other address with respect to a party as such party  notifies the
    other in writing as above provided.

          11.5 Complete Agreement. This Agreement and the exhibits and schedules
    hereto,  and the other  documents  delivered  by the  parties in  connection
    herewith, together with the Confidentiality Agreement,  contain the complete
    and exclusive  statement of the terms of the  agreement  between the parties
    hereto with respect to the transactions  contemplated hereby and thereby and
    supersede all prior agreements and understandings between the parties hereto
    with respect thereto.

          11.6 Captions;  References.  The captions  contained in this Agreement
    are  for  convenience  of  reference  only  and do not  form a part  of this
    Agreement. When a reference is made in this Agreement to a clause, a Section
    or an Article,  such reference will be to a clause,  a Section or Article of
    this Agreement unless otherwise indicated.

          11.7  Amendment.  This  Agreement may be amended or modified only by a
    written agreement duly executed by the parties to this Agreement.

          11.8 Waiver. At any time prior to the Closing Date, the parties hereto
    may (a) extend the time for the  performance  of any of the  obligations  or
    other  acts  of the  parties  hereto,  (b)  waive  any  inaccuracies  in the
    representations and warranties contained herein or in any document delivered
    pursuant  hereto,  or (c) waive  compliance  with any of the  agreements  or
    conditions  contained herein, to the extent permitted by applicable Law. Any
    agreement on the part of a party hereto to any such extension or waiver will
    be valid only if set forth in a writing signed on behalf of such party.

          11.9    Governing  Law.  This  Agreement  is to be governed  by, and
    construed and enforced in accordance  with, the laws of the State of Ohio,
    without regard to its rules of conflict of laws.

          11.10  Severability.  Any term or provision of this  Agreement that is
    invalid or unenforceable in any jurisdiction  will, as to that jurisdiction,
    be ineffective to the extent of such invalidity or unenforceability  without
    rendering  invalid or  unenforceable  the remaining  terms and provisions of
    this  Agreement or affecting  the validity or  enforceability  of any of the
    terms or  provisions  of this  Agreement in any other  jurisdiction.  If any
    provision  of  this  Agreement  is so  broad  as to  be  unenforceable,  the
    provision is to be interpreted to be only so broad as is enforceable.

          11.11 Further  Assurances.  Seller shall,  at the written  request and
    expense of Buyer,  at any time and from time to time  following the Closing,
    execute and deliver to Buyer all such further  instruments and take all such
    further  action as may be reasonably  necessary or  appropriate  in order to
    more effectively  sell,  assign,  transfer and convey to Buyer the Shares or
    otherwise to confirm or carry out the  provisions of this  Agreement.  Buyer
    shall,  and shall  cause the  Company  to, at any time and from time to time
    following  the  Closing  hereunder,  execute  and deliver to Seller all such
    further  instruments  and take all such further  action as may be reasonably
    necessary or  appropriate in order to confirm or carry out the provisions of
    this Agreement.

          11.12 Disclosure Schedule Supplements.  From time to time prior to the
    Closing,  Seller shall  promptly  supplement  or amend the Schedules to this
    Agreement (the "Disclosure  Schedules") with respect to any matter which, if
    existing,  occurring or known at the date of this Agreement, would have been
    required  to be set forth or  described  in the  Disclosure  Schedules.  The
    Disclosure  Schedules  will be deemed  amended by all such  supplements  and
    amendments for all purposes  except for purposes of determining  whether the
    conditions set forth in Section 7.3(a) have been satisfied.  Notwithstanding
    the  foregoing,  no such  supplement or amendment  will be effective for any
    purpose,  including  for  purposes  of  modifying,   altering,  limiting  or
    otherwise   affecting  the   representations,   warranties  and  indemnities
    contained  herein to the extent  that  Seller had  knowledge  of the matters
    stated therein as of the date hereof.

          11.13  Mutual  Drafting.  This  Agreement  is the  result of the joint
    efforts of Buyer and Seller,  and each provision  hereof has been subject to
    the mutual consultation,  negotiation and agreement of the parties and there
    is to be no  construction  against either party based on any  presumption of
    that party's involvement in the drafting thereof.

          11.14  Counterparts.  This  Agreement  may be  executed in two or more
    counterparts,  each of which is to be deemed an original but all of which is
    to constitute but one instrument.

                                   APPENDIX A

          "Actions" means any action, suit or legal,  administrative or arbitral
    proceeding or investigation before any Governmental Authority.

          "Affiliate"  means  with  respect  to any  Person,  any  Person  which
    directly or indirectly controls, is controlled by or is under common control
    with such Person.

          "Agreement"  has  the  meaning  set  forth  in the  preamble  to  this
    Agreement.

          "Business"  means the business of distributing the Current Products to
    the global marine and power equipment aftermarkets.

          "Business Day" means any day other than a Saturday, Sunday or a day on
    which banks in Illinois  are  authorized  or  obligated  by Law or executive
    order to close.

          "Buyer" has the meaning set forth in the  preamble to this  Agreement.
          "Buyer  Financials"  has the meaning set forth in Section 5.8.  "Buyer
          Plans" has the meaning set forth in Section  9.2(b).  "Buyer  Reports"
          has the meaning set forth in Section 5.8.  "Buyer's  Accountants"  has
          the meaning set forth in Section 2.3(c).  "Buyer's  Welfare Plans" has
          the meaning set forth in Section 9.2(c).  "Buyer's  Knowledge" has the
          meaning set forth in Section  5.4(a).  "Campbell"  has the meaning set
          forth in Section 4.16. "Cap" has the meaning set forth in 8.3(b).

          "Clearwater Lease" means the lease agreement, dated November 20, 1995,
    by and between New England Mutual Life Insurance Company and Seller.

          "Closing" has the meaning set forth in Section 3.1.

          "Closing Net Working  Assets  Statement"  has the meaning set forth in
    Section 2.3(b).

          "Closing Date" has the meaning set forth in Section 3.1.

          "Closing  Net  Working  Assets"  has the  meaning set forth in Section
    2.3(a).

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

          "Company" has the meaning set forth in the recitals of this Agreement.

          "Company  Benefit  Arrangements"  has the meaning set forth in Section
          4.9.  "Company  Contracts"  has the meaning set forth in Section 4.10.
          "Company  ERISA  Plans"  has the  meaning  set forth in  Section  4.9.
          "Confidentiality  Agreement"  has the  meaning  set  forth in  Section
          6.2(b).

          "Consents" means any consent, approval, authorization,  qualification,
          waiver  or  notification  of a  Governmental  Authority  or any  other
          Person.

          "Continuing Employees" has the moaning set forth in Section 9.1.

          "Control  Transaction"  means any  transaction  or  series of  related
    transactions  as a result of which any Person acquires from Seller or any of
    its  Affiliates the Shares,  substantially  all the assets of the Company or
    other assets or  securities  of the Company  sufficient  to give such Person
    control over the business of the Company.

          "Current Competitors" means those competitors of the Company set forth
    on Exhibit A.

          "Current  Customers"  means any Person  which  Seller  can  reasonably
    demonstrate  was a customer of the Company in the  six-(6)  months  prior to
    Closing.

          "Current  Products"  means those products of the Company listed in the
    most  recently  updated  product  catalogue of the Company as of the Closing
    Date.

          " Cut-off Date" has the meaning set forth in Section 9.2(c). "Damages"
          has the meaning set forth in Section  8.2.  "Dana" has the meaning set
          forth in  Section  2.2.  "Deductible"  has the  meaning  set  forth in
          Section 8.3.

          "Designated  Accounting  Arbitrator"  has the  meaning  set  forth  in
          Section 2.3(d).

           "Disclosure  Schedules"  has the meaning set forth in Section  11.12.
           "Dispute Notice" has the meaning set forth in Section 2.3(d).

          "Employee Retention Incentive Agreements" means the Employee Retention
    Incentive  Agreements by and between Dana and certain  management members of
    the Company set forth at Exhibit C.

          "Environmental Claim" has the meaning set forth in Section 4.14(a).

          "Expiration Date" has the meaning set forth in Section 8.1.

          "ERISA" means the Employee  Retirement Income Security Act of 1974, as
          amended.

          "Final Net  Working  Assets  Statement'  has the  meaning set forth in
    Section 2.3(f).

          "Freight   Agreement"   means  the  Echlin  Freight  Group  Membership
    Contract,  by and between Echlin Freight Group and the Company,  in the form
    set forth at Exhibit D.

          "GAAP" means United States generally accepted accounting principles.

          "Governmental   Authority"   means   any   government   or   political
    subdivision,  whether  federal,  state,  local or foreign,  or any agency or
    instrumentality  of any such  government  or political  subdivision,  or any
    federal, state, local or foreign court or arbitrator.

          "HSR Act" means the  Hart-Scott-Rodino  Antitrust  Improvements Act of
    1976, as amended, and the rules and regulations promulgated thereunder.

          "Indemnifying  Party" and  "Indemnified  Party" have the  meanings set
    forth in Section 8.1.

          "Intellectual Property" has the meaning set forth in Section 4.15(c).

          "June Balance Sheet" has the meaning set forth in Section 4.6.

          "Laws" means any law, statute,  code,  ordinance,  regulation or other
    legally enforceable requirement of any Governmental Authority.

          "Liens" means any mortgage,  lien, Option,  encumbrance,  restriction,
    pledge, adverse claim, interest, charge or other similar encumbrance.

          "Litchfield Facility Lease" means the Lease by and between Brake
    Parts Inc., as lessee, and the Company, as lessor, in the form of Exhibit
    E.

          "Material Adverse Effect" means, with respect to the Company or Buyer,
    a material adverse effect on the business,  assets, liabilities or financial
    condition  of such  party  and its  Subsidiaries,  if any,  taken as a whole
    (other  than  effects   which  result  from  changes  in  general   economic
    conditions).

          "Material Equipment" has the meaning set forth in Section 4.8(d).

          "NAPA Business Practices" has the meaning set forth in Section 6.8.

          "Option" means any option,  warrant, call, convertible or exchangeable
    security, subscription,  preemptive right or voting trust, or agreement, any
    agreement  restricting  sale or transfer,  or other  agreement or right of a
    similar nature.

          "Orders" means any order, judgment, ruling, injunction,  award, decree
    or writ of any Governmental Authority.

          "Outside Date" has the meaning set forth in Section 10.1(b).  "Pension
          Plan" has the meaning set forth in Section 9.2(d)(i).

          "Permits" means any license, permit,  authorization,  grant, approval,
    franchise, waiver, Consent,  qualification or similar document: or authority
    issued or granted by any Governmental Authority.

          "Person"  means  any  individual,  sole  proprietorship,  partnership,
    corporation,   limited  liability  company,  joint  venture,  unincorporated
    society or association, trust or other entity or Governmental Authority.

          "Purchase Price" has the meaning set forth in Section 2.2.

          "Real Property" means all of the Company's real property and interests
    in real property, leaseholds and subleaseholds, purchase options, easements,
    licenses,  rights  to  access,  rights  of  way,  all  buildings  and  other
    improvements thereon, and other real property interests used in the business
    or operations of the Company together with any additions thereto between the
    date of this Agreement and the Closing Date.

          "Representatives" has the meaning set forth in Section 8.5.

          "Restricted  Territory"  means the  geographic  area within a 100 mile
    radius of any and all of the Company  locations where the Company  maintains
    an office or a facility  during the two year  period  following  the date of
    this Agreement.

          "Savings Plan" has the meaning set forth in Section 9.2(d)(i).

          "SEC' has the meaning set forth in Section 5.8.

          "Section  338(h)(10)  Election"  has the  meaning set forth in Section
    6.6(e).

          "Seller" has the meaning set forth in the preamble to this Agreement.

          "Seller Welfare Plans" has the meaning set forth in Section 9.2 (c).

          "Seller's Accountants" has the meaning set forth in Section 2.3(c).

          "Seller's  Knowledge" means the actual knowledge of Ira Davis,  Robert
    Tobey or Ed Zak.

          "Shares" has the meaning set forth in the recitals of this Agreement.

          "Specified  Accounting  Principles"  means  the  Specified  Accounting
    Principles set forth in Exhibit E.

          "Subsidiaries"  means any Person of which at least a  majority  of the
    outstanding  shares or other equity  interests  having ordinary voting power
    for the election of directors or  comparable  managers of such Person are at
    the time owned,  directly or indirectly,  by such Person,  by one or more of
    its Subsidiaries, or by such Person and one or more of its Subsidiaries.

          "Supply  Agreement" means the Supply Agreement,  by and between Seller
    and the Company, in the form set forth at Exhibit G.

          "Tax or Taxes" means any domestic or foreign  federal,  state or local
    income, franchise, business, occupation,  sales/use,  manufacturer's excise,
    payroll, withholding, Federal Insurance Contributions Act and employment and
    unemployment taxes,  personal and real property taxes and all other taxes or
    charges (including all interest and penalties) measured,  assessed,  levied,
    imposed or collected by any Governmental Authority.

          "Tax Returns" means all Tax returns  (including  information  returns)
    and reports  that are or were  required to be filed by, or with  respect to,
    the Company or its income, properties or operations.

          "Transitional  Services  Agreement"  means the  Transitional  Services
    Agreement,  by and between Seller and the Company,  in the form set forth at
    Exhibit H.

          "Trucking Agreement" means the DTF Trucking Agreement,  by and between
    DTF Trucking, Inc. and the Company, in the form set forth at Exhibit I.

          "WARN Act" has the meaning set forth in Section 9.3.

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