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Proc-Type: 2001,MIC-CLEAR
Originator-Name: webmaster@www.sec.gov
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<SEC-DOCUMENT>0000217346-02-000001.txt : 20020413
<SEC-HEADER>0000217346-02-000001.hdr.sgml : 20020413
ACCESSION NUMBER:		0000217346-02-000001
CONFORMED SUBMISSION TYPE:	8-K
PUBLIC DOCUMENT COUNT:		2
CONFORMED PERIOD OF REPORT:	20011220
ITEM INFORMATION:		Acquisition or disposition of assets
ITEM INFORMATION:		Financial statements and exhibits
FILED AS OF DATE:		20020104

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			TEXTRON INC
		CENTRAL INDEX KEY:			0000217346
		STANDARD INDUSTRIAL CLASSIFICATION:	AIRCRAFT & PARTS [3720]
		IRS NUMBER:				050315468
		STATE OF INCORPORATION:			DE
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		8-K
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	001-05480
		FILM NUMBER:		2502112

	BUSINESS ADDRESS:	
		STREET 1:		40 WESTMINSTER ST
		CITY:			PROVIDENCE
		STATE:			RI
		ZIP:			02903
		BUSINESS PHONE:		4014212800

	MAIL ADDRESS:	
		STREET 1:		40 WESTMINSTER ST
		CITY:			PROVIDENCE
		STATE:			RI
		ZIP:			02903

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	AMERICAN TEXTRON INC
		DATE OF NAME CHANGE:	19710510
</SEC-HEADER>
<DOCUMENT>
<TYPE>8-K
<SEQUENCE>1
<FILENAME>eightk.htm
<DESCRIPTION>FINANCIALS/NOTES
<TEXT>
<html>

<head>
<title>SECURITIES AND EXCHANGE COMMISSION</title>
</head>

<body>

<b>
<p ALIGN="CENTER">&nbsp;</p>
<p ALIGN="CENTER">SECURITIES AND EXCHANGE COMMISSION</p>
</b>
<p ALIGN="CENTER">Washington, D.C. 20549</p>
<font SIZE="2">
<p ALIGN="CENTER">&nbsp;</p>
<p ALIGN="CENTER">_______________</p>
<p ALIGN="CENTER">&nbsp;</p>
</font><b><font SIZE="5">
<p ALIGN="CENTER">FORM 8&#45;K</p>
</font></b>
<p ALIGN="CENTER"><br>
<br>
CURRENT REPORT</p>
<p ALIGN="CENTER">PURSUANT TO SECTION 13 OR 15(d) OF<br>
THE SECURITIES EXCHANGE ACT OF 1934</p>
<p ALIGN="CENTER">&nbsp;</p>
<u>
<p ALIGN="CENTER">&#160;&#160;&#160;&#160;&#160;&#160;&#160;December
20, 2001&#160;&#160;&#160;&#160;&#160;&#160;&#160;</p>
</u>
<p ALIGN="CENTER">(Date of earliest event reported)</p>
<font SIZE="2">
<p ALIGN="CENTER"><br>
<br>
</font><b><font SIZE="5">TEXTRON INC.</p>
</font></b><font SIZE="2">
<p ALIGN="CENTER">&nbsp;</p>
</font>
<p ALIGN="CENTER">(Exact name of registrant as specified in its charter)</p>
<font SIZE="2">
<p ALIGN="CENTER"><br>
<br>
</p>
</font>
<div align="center">
  <center>
<table CELLSPACING="0" WIDTH="683">
  <tr>
    <td WIDTH="39%" VALIGN="TOP" HEIGHT="54"><u>
      <p ALIGN="CENTER">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Delaware&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;</u><br>
      (State or other jurisdiction of<br>
      incorporation or organization)</td>
    <td WIDTH="25%" VALIGN="TOP" HEIGHT="54"><u>
      <p ALIGN="CENTER">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;1&#45;5480&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;</u><br>
      (Commission File Number)</td>
    <td WIDTH="36%" VALIGN="TOP" HEIGHT="54"><u>
      <p ALIGN="CENTER">&#160;&#160;&#160;&#160;&#160;&#160;05&#45;0315468&#160;&#160;&#160;&#160;&#160;&#160;&#160;</u><br>
      (I.R.S. Employer<br>
      Identification No.)</td>
  </tr>
</table>
  </center>
</div>
<font SIZE="2">
<p ALIGN="CENTER">&nbsp;</p>
</font><u>
<p ALIGN="CENTER">40 Westminster Street, Providence, Rhode Island 02903<br>
</u>(Address of principal executive offices including zip code)</p>
<u>
<p ALIGN="CENTER">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;(401)
421&#45;2800&#160;&#160;&#160;&#160;&#160;&#160;&#160;<br>
</u>(Registrant&#39;s telephone number including area code)</p>
<p ALIGN="CENTER">&nbsp;</p>
<u>
<p ALIGN="CENTER">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;N/A&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;<br>
</u>(Former name or former address, if changed since last report)</p>
<p ALIGN="CENTER">&nbsp;</p>
<b>
<p>Item 2. Acquisition or Disposition of Assets</p>
</b>
<p>On December 20, 2001, Textron completed the sale of its Automotive Trim
business to Collins & Aikman Products Co. (&quot;C&A Products&quot;), a
subsidiary of Collins & Aikman Corporation (&quot;C&A
Corporation&quot;), pursuant to a Purchase Agreement (the &quot;Purchase
Agreement&quot;) by and among Textron, C&A Corporation and C&A Products.
Pursuant to the Purchase Agreement, Textron will receive $800 million in a
combination of $625 million in cash, a transfer of $88 million indebtedness and
$87 million in lease financing. In addition, Textron will receive preferred
shares of C&A Products with a face value of $326 million and 18 million
shares of C&A Corporation common stock. Textron will also retain a 50%
interest in an Italian joint venture, which Textron will have the right to sell
to C&A Products for $23.1 million at a future date.</p>
<p>The Purchase Agreement also includes a provision that entitles Textron Inc.
to an additional cash payment of up to $125 million to be calculated based on
C&A Corporation&#39;s operating results for the five year period ending
fiscal 2006.</p>
<p>The lease financing involves approximately $87 million of equipment used by
the Automotive Trim business that will be retained by Textron and leased back to
the business through Textron Financial Corporation.</p>
<p>A copy of the Purchase Agreement is filed as an exhibit hereto.</p>
<b>
<p>Item 7. Financial Statements and Exhibits</p>
</b>
<table CELLSPACING="0" CELLPADDING="1" WIDTH="862">
  <tr>
    <td WIDTH="38" VALIGN="TOP"><b>
      <p>(b)</b></td>
    <td WIDTH="816" VALIGN="TOP"><b>
      <p>Pro Forma Financial Information</b></td>
  </tr>
  <tr>
    <td WIDTH="38" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="816" VALIGN="TOP">
      <p>The following unaudited Pro Forma Condensed Consolidated Statement of
      Operations for the nine months ended September 29, 2001 and the fiscal
      year ended December 30, 2000 and the unaudited Pro Forma Condensed
      Consolidated Balance Sheet as of September 29, 2001 were prepared to
      illustrate the estimated effects of the sale. The unaudited Pro Forma
      Condensed Consolidated Statement of Operations for the year ended December
      30, 2000 and for the nine months ended September 29, 2001 have been
      prepared to give effect to the sale of the Automotive trim business as if
      it had occurred on January 2, 2000 and December 31, 2000, respectively.
      The unaudited Pro Forma Condensed Consolidated Balance Sheet as of
      September 29, 2001 has been prepared to give effect to the sale as if it
      had occurred on such date.</td>
  </tr>
  <tr>
    <td WIDTH="38" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="816" VALIGN="TOP">
      <p>The unaudited pro forma condensed consolidated financial statements
      have been presented for informational purposes only and do not purport to
      indicate what the Company&#39;s results of operations or financial
      position would have been if the transaction had in fact occurred on the
      dates indicated or to project the Company&#39;s results of operations
      for any future period or any future date. The unaudited pro forma
      adjustments are based upon available information and upon certain
      assumptions stated in the notes thereto that the Company believes are
      reasonable. The unaudited pro forma condensed financial statements should
      be read in conjunction with the consolidated financial statements of the
      Company and related notes included in the Company&#39;s fiscal 2000
      Annual Report.</td>
  </tr>
</table>
<b><font SIZE="2">
<p ALIGN="CENTER">TEXTRON INC.<br>
<a NAME="_Hlk528633953">Pro Forma Condensed Consolidated Balance Sheet</a> (unaudited)<br>
September 29, 2001</font></b><font SIZE="2"><br>
(Dollars in millions)</p>
</font>
<div align="left">
<table CELLSPACING="1" CELLPADDING="1" WIDTH="760" height="995">
  <tr>
    <td WIDTH="294" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="30"><font size="1">&nbsp;</font></td>
    <td WIDTH="90" VALIGN="TOP" COLSPAN="2" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="30"><font SIZE="1">
      <p ALIGN="CENTER"><br>
      Textron Inc.</font></td>
    <td WIDTH="11" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="30"><font size="1">&nbsp;</font></td>
    <td WIDTH="100" VALIGN="TOP" COLSPAN="2" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="30">
      <p ALIGN="CENTER"><font size="1">Automotive Trim Business <a NAME="_Hlk534695595" href="#notea">(A)</a></font></td>
    <td WIDTH="99" VALIGN="TOP" COLSPAN="2" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="30"><font SIZE="1">
      <p ALIGN="CENTER">Pro Forma<br>
      Adjustments</font></td>
    <td WIDTH="25" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="30"><font size="1">&nbsp;</font></td>
    <td WIDTH="97" VALIGN="TOP" COLSPAN="3" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="30"><font SIZE="1">
      <p ALIGN="CENTER">Adjusted<br>
      Pro Forma</font></td>
    <td WIDTH="10" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="30"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="292" VALIGN="TOP" height="16"><b><font SIZE="1">
      <p>Assets</font></b></td>
    <td WIDTH="88" VALIGN="TOP" COLSPAN="2" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="9" VALIGN="TOP" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="98" VALIGN="TOP" COLSPAN="2" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="97" VALIGN="TOP" COLSPAN="2" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="23" VALIGN="TOP" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="95" VALIGN="TOP" COLSPAN="3" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="8" VALIGN="TOP" height="16"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="292" VALIGN="TOP" height="16"><b><font SIZE="1">
      <p>Textron Manufacturing</font></b></td>
    <td WIDTH="88" VALIGN="TOP" COLSPAN="2" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="9" VALIGN="TOP" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="98" VALIGN="TOP" COLSPAN="2" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="97" VALIGN="TOP" COLSPAN="2" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="23" VALIGN="TOP" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="95" VALIGN="TOP" COLSPAN="3" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="8" VALIGN="TOP" height="16"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="292" VALIGN="TOP" height="16"><font SIZE="1">
      <p>Cash and cash equivalents</font></td>
    <td WIDTH="8" VALIGN="TOP" height="16"><font SIZE="1">
      <p ALIGN="RIGHT">$</font></td>
    <td WIDTH="74" VALIGN="TOP" height="16"><font SIZE="1">
      <p align="right" style="margin-right: 20">261</font></td>
    <td WIDTH="9" VALIGN="TOP" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="18" VALIGN="TOP" height="16"><font SIZE="1">
      <p ALIGN="RIGHT">$</font></td>
    <td WIDTH="74" VALIGN="TOP" height="16"><font SIZE="1">
      <p align="right" style="margin-right: 20">(36)</font></td>
      <center>
    <td WIDTH="11" VALIGN="TOP" height="16"><font SIZE="1">
      <p ALIGN="RIGHT">$</font></td>
      </center>
    <td WIDTH="80" VALIGN="TOP" height="16">
      <p align="right" style="margin-right: 20"><font size="1">343 (<a href="#noteb">B</a>)</font></td>
      <center>
    <td WIDTH="23" VALIGN="TOP" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="15" VALIGN="TOP" COLSPAN="2" height="16"><font SIZE="1">
      <p ALIGN="RIGHT">$</font></td>
      </center>
    <td WIDTH="74" VALIGN="TOP" height="16"><font SIZE="1">
      <p align="right" style="margin-right: 20">568&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
      <center>
    <td WIDTH="8" VALIGN="TOP" height="16"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="292" VALIGN="TOP" height="16"><font SIZE="1">
      <p>Commercial and U.S. government receivables, net</font></td>
    <td WIDTH="88" VALIGN="TOP" COLSPAN="2" align="right" height="16"><font SIZE="1">
      <p style="margin-right: 20">1,500</font></td>
    <td WIDTH="9" VALIGN="TOP" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="98" VALIGN="TOP" COLSPAN="2" align="right" height="16"><font SIZE="1">
      <p style="margin-right: 20">(237)</font></td>
    <td WIDTH="97" VALIGN="TOP" COLSPAN="2" align="right" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
      </td>
    <td WIDTH="23" VALIGN="TOP" align="right" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
      </td>
    <td WIDTH="95" VALIGN="TOP" COLSPAN="3" align="right" height="16"><font SIZE="1">
      <p style="margin-right: 20">1,263</font></td>
    <td WIDTH="8" VALIGN="TOP" height="16"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="292" VALIGN="TOP" height="16"><font SIZE="1">
      <p>Inventories</font></td>
    <td WIDTH="88" VALIGN="TOP" COLSPAN="2" align="right" height="16"><font SIZE="1">
      <p style="margin-right: 20">2,018</font></td>
    <td WIDTH="9" VALIGN="TOP" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="98" VALIGN="TOP" COLSPAN="2" align="right" height="16"><font SIZE="1">
      <p style="margin-right: 20">(43)</font></td>
    <td WIDTH="97" VALIGN="TOP" COLSPAN="2" align="right" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
      </td>
    <td WIDTH="23" VALIGN="TOP" align="right" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
      </td>
    <td WIDTH="95" VALIGN="TOP" COLSPAN="3" align="right" height="16"><font SIZE="1">
      <p style="margin-right: 20">1,975</font></td>
    <td WIDTH="8" VALIGN="TOP" height="16"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="292" VALIGN="TOP" height="16"><font SIZE="1">
      <p>Other current assets</font></td>
    <td WIDTH="88" VALIGN="TOP" COLSPAN="2" align="right" height="16"><font SIZE="1">
      <p style="margin-right: 20">443</font></td>
    <td WIDTH="9" VALIGN="TOP" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="98" VALIGN="TOP" COLSPAN="2" align="right" height="16"><font SIZE="1">
      <p style="margin-right: 20">(43)</font></td>
    <td WIDTH="97" VALIGN="TOP" COLSPAN="2" align="right" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
      </td>
    <td WIDTH="23" VALIGN="TOP" align="right" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
      </td>
    <td WIDTH="95" VALIGN="TOP" COLSPAN="3" align="right" height="16"><font SIZE="1">
      <p style="margin-right: 20">400</font></td>
    <td WIDTH="8" VALIGN="TOP" height="16"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="294" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="16"><font SIZE="1">
      <p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Total
      current assets</font></td>
    <td WIDTH="90" VALIGN="TOP" COLSPAN="2" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="16"><font SIZE="1">
      <p style="margin-right: 20">4,222</font></td>
    <td WIDTH="11" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="100" VALIGN="TOP" COLSPAN="2" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="16"><font SIZE="1">
      <p style="margin-right: 20">(359)</font></td>
    <td WIDTH="99" VALIGN="TOP" COLSPAN="2" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="16"><font SIZE="1">
      <p style="margin-right: 40">343</font></td>
    <td WIDTH="25" VALIGN="TOP" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
      </td>
    <td WIDTH="97" VALIGN="TOP" COLSPAN="3" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="16"><font SIZE="1">
      <p style="margin-right: 20">4,206</font></td>
    <td WIDTH="10" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="16"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="292" VALIGN="TOP" height="16"><font SIZE="1">
      <p>Property, plant, and equipment, net</font></td>
    <td WIDTH="88" VALIGN="TOP" COLSPAN="2" align="right" height="16"><font SIZE="1">
      <p style="margin-right: 20">2,560</font></td>
    <td WIDTH="9" VALIGN="TOP" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="98" VALIGN="TOP" COLSPAN="2" align="right" height="16"><font SIZE="1">
      <p style="margin-right: 20">(483)</font></td>
    <td WIDTH="97" VALIGN="TOP" COLSPAN="2" align="right" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
      </td>
    <td WIDTH="23" VALIGN="TOP" align="right" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
      </td>
    <td WIDTH="95" VALIGN="TOP" COLSPAN="3" align="right" height="16"><font SIZE="1">
      <p style="margin-right: 20">2,077</font></td>
    <td WIDTH="8" VALIGN="TOP" height="16"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="292" VALIGN="TOP" height="16"><font SIZE="1">
      <p>Intangibles, net</font></td>
    <td WIDTH="88" VALIGN="TOP" COLSPAN="2" align="right" height="16"><font SIZE="1">
      <p style="margin-right: 20">2,183</font></td>
    <td WIDTH="9" VALIGN="TOP" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="98" VALIGN="TOP" COLSPAN="2" align="right" height="16"><font SIZE="1">
      <p style="margin-right: 20">(184)</font></td>
    <td WIDTH="97" VALIGN="TOP" COLSPAN="2" align="right" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
      </td>
    <td WIDTH="23" VALIGN="TOP" align="right" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
      </td>
    <td WIDTH="95" VALIGN="TOP" COLSPAN="3" align="right" height="16"><font SIZE="1">
      <p style="margin-right: 20">1,999</font></td>
    <td WIDTH="8" VALIGN="TOP" height="16"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="292" VALIGN="TOP" height="16"><font SIZE="1">
      <p>Other assets</font></td>
    <td WIDTH="88" VALIGN="TOP" COLSPAN="2" align="right" height="16"><font SIZE="1">
      <p style="margin-right: 20">1,548</font></td>
    <td WIDTH="9" VALIGN="TOP" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="98" VALIGN="TOP" COLSPAN="2" align="right" height="16"><font SIZE="1">
      <p style="margin-right: 20">(113)</font></td>
    <td WIDTH="97" VALIGN="TOP" COLSPAN="2" align="right" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp; 278 (<a href="#notec">C</a>)</font></td>
    <td WIDTH="23" VALIGN="TOP" align="right" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
      </td>
    <td WIDTH="95" VALIGN="TOP" COLSPAN="3" align="right" height="16"><font SIZE="1">
      <p style="margin-right: 20">1,713</font></td>
    <td WIDTH="8" VALIGN="TOP" height="16"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="294" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="16"><font SIZE="1">
      <p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Total
      Textron Manufacturing assets</font></td>
    <td WIDTH="90" VALIGN="TOP" COLSPAN="2" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="16"><font SIZE="1">
      <p style="margin-right: 20">10,513</font></td>
    <td WIDTH="11" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="100" VALIGN="TOP" COLSPAN="2" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="16"><font SIZE="1">
      <p style="margin-right: 20">(1,139)</font></td>
    <td WIDTH="99" VALIGN="TOP" COLSPAN="2" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="16"><font SIZE="1">
      <p style="margin-right: 40">621</font></td>
    <td WIDTH="25" VALIGN="TOP" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
      </td>
    <td WIDTH="97" VALIGN="TOP" COLSPAN="3" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="16"><font SIZE="1">
      <p style="margin-right: 20">9,995</font></td>
    <td WIDTH="10" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="16"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="292" VALIGN="TOP" height="16"><b><font SIZE="1">
      <p>Textron Finance</font></b></td>
    <td WIDTH="88" VALIGN="TOP" COLSPAN="2" align="right" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
    </td>
    <td WIDTH="9" VALIGN="TOP" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="98" VALIGN="TOP" COLSPAN="2" align="right" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
    </td>
    <td WIDTH="97" VALIGN="TOP" COLSPAN="2" align="right" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
    </td>
    <td WIDTH="23" VALIGN="TOP" align="right" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
    </td>
    <td WIDTH="95" VALIGN="TOP" COLSPAN="3" align="right" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
    </td>
    <td WIDTH="8" VALIGN="TOP" height="16"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="292" VALIGN="TOP" height="16"><font SIZE="1">
      <p>Cash</font></td>
    <td WIDTH="88" VALIGN="TOP" COLSPAN="2" align="right" height="16"><font SIZE="1">
      <p style="margin-right: 20">38</font></td>
    <td WIDTH="9" VALIGN="TOP" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="98" VALIGN="TOP" COLSPAN="2" align="right" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
      </td>
    <td WIDTH="97" VALIGN="TOP" COLSPAN="2" align="right" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
      </td>
    <td WIDTH="23" VALIGN="TOP" align="right" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
      </td>
    <td WIDTH="95" VALIGN="TOP" COLSPAN="3" align="right" height="16"><font SIZE="1">
      <p style="margin-right: 20">38</font></td>
    <td WIDTH="8" VALIGN="TOP" height="16"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="292" VALIGN="TOP" height="16"><font SIZE="1">
      <p>Finance receivables, net</font></td>
    <td WIDTH="88" VALIGN="TOP" COLSPAN="2" align="right" height="16"><font SIZE="1">
      <p style="margin-right: 20">5,780</font></td>
    <td WIDTH="9" VALIGN="TOP" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="98" VALIGN="TOP" COLSPAN="2" align="right" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
      </td>
    <td WIDTH="97" VALIGN="TOP" COLSPAN="2" align="right" height="16">
      <p style="margin-right: 20"><font size="1">87 (<a href="#noted">D</a>)</font></td>
    <td WIDTH="23" VALIGN="TOP" align="right" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
      </td>
    <td WIDTH="95" VALIGN="TOP" COLSPAN="3" align="right" height="16"><font SIZE="1">
      <p style="margin-right: 20">5,867</font></td>
    <td WIDTH="8" VALIGN="TOP" height="16"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="292" VALIGN="TOP" height="16"><font SIZE="1">
      <p>Other assets</font></td>
    <td WIDTH="88" VALIGN="TOP" COLSPAN="2" align="right" height="16"><font SIZE="1">
      <p style="margin-right: 20">807</font></td>
    <td WIDTH="9" VALIGN="TOP" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="98" VALIGN="TOP" COLSPAN="2" align="right" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
      </td>
    <td WIDTH="97" VALIGN="TOP" COLSPAN="2" align="right" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
      </td>
    <td WIDTH="23" VALIGN="TOP" align="right" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
      </td>
    <td WIDTH="95" VALIGN="TOP" COLSPAN="3" align="right" height="16"><font SIZE="1">
      <p style="margin-right: 20">807</font></td>
    <td WIDTH="8" VALIGN="TOP" height="16"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="294" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="16"><font SIZE="1">
      <p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Total
      Textron Finance assets</font></td>
    <td WIDTH="90" VALIGN="TOP" COLSPAN="2" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="16"><font SIZE="1">
      <p style="margin-right: 20">6,625</font></td>
    <td WIDTH="11" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="100" VALIGN="TOP" COLSPAN="2" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
      </td>
    <td WIDTH="99" VALIGN="TOP" COLSPAN="2" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="16"><font SIZE="1">
      <p style="margin-right: 40">87</font></td>
    <td WIDTH="25" VALIGN="TOP" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
      </td>
    <td WIDTH="97" VALIGN="TOP" COLSPAN="3" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="16"><font SIZE="1">
      <p style="margin-right: 20">6,712</font></td>
    <td WIDTH="10" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="16"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="294" VALIGN="TOP" style="border-bottom-style: solid" height="18"><font SIZE="1">
      <p><a NAME="_Hlk515095305">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Total
      assets</a></font></td>
    <td WIDTH="10" VALIGN="TOP" style="border-bottom-style: solid" height="18"><font SIZE="1">
      <p ALIGN="RIGHT">$</font></td>
    <td WIDTH="76" VALIGN="TOP" style="border-bottom-style: solid" height="18"><font SIZE="1">
      <p align="right" style="margin-right: 20">17,138</font></td>
    <td WIDTH="11" VALIGN="TOP" style="border-bottom-style: solid" height="18"><font size="1">&nbsp;</font></td>
    <td WIDTH="20" VALIGN="TOP" style="border-bottom-style: solid" height="18"><font SIZE="1">
      <p ALIGN="RIGHT">$</font></td>
    </center>
    <td WIDTH="76" VALIGN="TOP" style="border-bottom-style: solid" height="18"><font SIZE="1">
      <p align="right" style="margin-right: 20">(1,139)</font></td>
      <center>
    <td WIDTH="13" VALIGN="TOP" style="border-bottom-style: solid" height="18"><font SIZE="1">
      <p ALIGN="RIGHT">$</font></td>
      </center>
    <td WIDTH="82" VALIGN="TOP" style="border-bottom-style: solid" height="18"><font SIZE="1">
      <p align="right" style="margin-right: 40">708</font></td>
      <center>
    <td WIDTH="25" VALIGN="TOP" style="border-bottom-style: solid" height="18"><font size="1">&nbsp;</font></td>
    <td WIDTH="17" VALIGN="TOP" COLSPAN="2" style="border-bottom-style: solid" height="18"><font SIZE="1">
      <p ALIGN="RIGHT">$</font></td>
      </center>
    <td WIDTH="76" VALIGN="TOP" style="border-bottom-style: solid" height="18"><font SIZE="1">
      <p align="right" style="margin-right: 20">16,707&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
      <center>
    <td WIDTH="10" VALIGN="TOP" style="border-bottom-style: solid" height="18"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="292" VALIGN="TOP" height="16"><b><font SIZE="1">
      <p>Liabilities and shareholders&#39; equity</font></b></td>
    <td WIDTH="88" VALIGN="TOP" COLSPAN="2" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="9" VALIGN="TOP" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="98" VALIGN="TOP" COLSPAN="2" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="97" VALIGN="TOP" COLSPAN="2" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="23" VALIGN="TOP" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="95" VALIGN="TOP" COLSPAN="3" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="8" VALIGN="TOP" height="16"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="292" VALIGN="TOP" height="16"><b><font SIZE="1">
      <p>Liabilities</font></b></td>
    <td WIDTH="88" VALIGN="TOP" COLSPAN="2" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="9" VALIGN="TOP" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="98" VALIGN="TOP" COLSPAN="2" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="97" VALIGN="TOP" COLSPAN="2" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="23" VALIGN="TOP" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="95" VALIGN="TOP" COLSPAN="3" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="8" VALIGN="TOP" height="16"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="292" VALIGN="TOP" height="16"><b><font SIZE="1">
      <p>Textron Manufacturing</font></b></td>
    <td WIDTH="88" VALIGN="TOP" COLSPAN="2" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="9" VALIGN="TOP" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="98" VALIGN="TOP" COLSPAN="2" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="97" VALIGN="TOP" COLSPAN="2" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="23" VALIGN="TOP" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="95" VALIGN="TOP" COLSPAN="3" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="8" VALIGN="TOP" height="16"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="292" VALIGN="TOP" height="16"><font SIZE="1">
      <p>Current portion of long&#45;term debt and short&#45;term debt</font></td>
    <td WIDTH="8" VALIGN="TOP" height="16"><font SIZE="1">
      <p ALIGN="RIGHT">$</font></td>
    <td WIDTH="74" VALIGN="TOP" height="16"><font SIZE="1">
      <p align="right" style="margin-right: 20">1,353</font></td>
    <td WIDTH="9" VALIGN="TOP" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="18" VALIGN="TOP" height="16"><font SIZE="1">
      <p>$</font></td>
    </center>
    <td WIDTH="74" VALIGN="TOP" height="16"><font SIZE="1">
      <p align="right" style="margin-right: 20">(44)</font></td>
      <center>
    <td WIDTH="11" VALIGN="TOP" height="16"><font SIZE="1">
      <p ALIGN="RIGHT">$</font></td>
      </center>
    <td WIDTH="80" VALIGN="TOP" height="16">
      <p align="right" style="margin-right: 20"><font size="1">(404) (<a href="#notee">E</a>)</font></td>
      <center>
    <td WIDTH="23" VALIGN="TOP" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="15" VALIGN="TOP" COLSPAN="2" height="16"><font SIZE="1">
      <p ALIGN="RIGHT">$</font></td>
      </center>
    <td WIDTH="74" VALIGN="TOP" height="16"><font SIZE="1">
      <p align="right" style="margin-right: 20">905&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
      <center>
    <td WIDTH="8" VALIGN="TOP" height="16"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="292" VALIGN="TOP" height="16"><font SIZE="1">
      <p>Accounts payable and accrued liabilities</font></td>
    <td WIDTH="88" VALIGN="TOP" COLSPAN="2" align="right" height="16"><font SIZE="1">
      <p style="margin-right: 20">2,583</font></td>
    <td WIDTH="9" VALIGN="TOP" align="right" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="98" VALIGN="TOP" COLSPAN="2" align="right" height="16"><font SIZE="1">
      <p style="margin-right: 20">(374)</font></td>
    <td WIDTH="97" VALIGN="TOP" COLSPAN="2" align="right" height="16">
      <p style="margin-right: 20"><font size="1">196 (<a href="#notef">F</a>)</font></td>
    <td WIDTH="23" VALIGN="TOP" align="right" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
      </td>
    <td WIDTH="95" VALIGN="TOP" COLSPAN="3" align="right" height="16"><font SIZE="1">
      <p style="margin-right: 20">2,405</font></td>
    <td WIDTH="8" VALIGN="TOP" height="16"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="294" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="16"><font SIZE="1">
      <p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Total
      current liabilities</font></td>
    <td WIDTH="90" VALIGN="TOP" COLSPAN="2" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="16"><font SIZE="1">
      <p style="margin-right: 20">3,936</font></td>
    <td WIDTH="11" VALIGN="TOP" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="100" VALIGN="TOP" COLSPAN="2" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="16"><font SIZE="1">
      <p style="margin-right: 20">(418)</font></td>
    <td WIDTH="99" VALIGN="TOP" COLSPAN="2" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="16"><font SIZE="1">
      <p style="margin-right: 30">(208)&nbsp;&nbsp;</font></td>
    <td WIDTH="25" VALIGN="TOP" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
      </td>
    <td WIDTH="97" VALIGN="TOP" COLSPAN="3" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="16"><font SIZE="1">
      <p style="margin-right: 20">3,310</font></td>
    <td WIDTH="10" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="16"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="292" VALIGN="TOP" height="16"><font SIZE="1">
      <p>Other liabilities</font></td>
    <td WIDTH="88" VALIGN="TOP" COLSPAN="2" align="right" height="16"><font SIZE="1">
      <p style="margin-right: 20">1,876</font></td>
    <td WIDTH="9" VALIGN="TOP" align="right" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="98" VALIGN="TOP" COLSPAN="2" align="right" height="16"><font SIZE="1">
      <p style="margin-right: 20">(144)</font></td>
    <td WIDTH="97" VALIGN="TOP" COLSPAN="2" align="right" height="16">
      <p style="margin-right: 20"><font size="1">33 (<a href="#noteg">G</a>)&nbsp;</font></td>
    <td WIDTH="23" VALIGN="TOP" align="right" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
      </td>
    <td WIDTH="95" VALIGN="TOP" COLSPAN="3" align="right" height="16"><font SIZE="1">
      <p style="margin-right: 20">1,765</font></td>
    <td WIDTH="8" VALIGN="TOP" height="16"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="292" VALIGN="TOP" height="16"><font SIZE="1">
      <p>Long&#45;term debt</font></td>
    <td WIDTH="88" VALIGN="TOP" COLSPAN="2" align="right" height="16"><font SIZE="1">
      <p style="margin-right: 20">1,475</font></td>
    <td WIDTH="9" VALIGN="TOP" align="right" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="98" VALIGN="TOP" COLSPAN="2" align="right" height="16"><font SIZE="1">
      <p style="margin-right: 20">(5)</font></td>
    <td WIDTH="97" VALIGN="TOP" COLSPAN="2" align="right" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
      </td>
    <td WIDTH="23" VALIGN="TOP" align="right" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
      </td>
    <td WIDTH="95" VALIGN="TOP" COLSPAN="3" align="right" height="16"><font SIZE="1">
      <p style="margin-right: 20">1,470</font></td>
    <td WIDTH="8" VALIGN="TOP" height="16"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="294" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="16"><font SIZE="1">
      <p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Total
      Textron Manufacturing liabilities</font></td>
    <td WIDTH="90" VALIGN="TOP" COLSPAN="2" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="16"><font SIZE="1">
      <p style="margin-right: 20">7,287</font></td>
    <td WIDTH="11" VALIGN="TOP" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="100" VALIGN="TOP" COLSPAN="2" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="16"><font SIZE="1">
      <p style="margin-right: 20">(567)</font></td>
    <td WIDTH="99" VALIGN="TOP" COLSPAN="2" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="16"><font SIZE="1">
      <p style="margin-right: 20">(175)</font></td>
    <td WIDTH="25" VALIGN="TOP" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
      </td>
    <td WIDTH="97" VALIGN="TOP" COLSPAN="3" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="16"><font SIZE="1">
      <p style="margin-right: 20">6,545</font></td>
    <td WIDTH="10" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="16"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="292" VALIGN="TOP" height="16"><b><font SIZE="1">
      <p>Textron Finance</font></b></td>
    <td WIDTH="88" VALIGN="TOP" COLSPAN="2" align="right" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
    </td>
    <td WIDTH="9" VALIGN="TOP" align="right" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="98" VALIGN="TOP" COLSPAN="2" align="right" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
    </td>
    <td WIDTH="97" VALIGN="TOP" COLSPAN="2" align="right" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
    </td>
    <td WIDTH="23" VALIGN="TOP" align="right" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
    </td>
    <td WIDTH="95" VALIGN="TOP" COLSPAN="3" align="right" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
    </td>
    <td WIDTH="8" VALIGN="TOP" height="16"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="292" VALIGN="TOP" height="16"><font SIZE="1">
      <p>Other liabilities</font></td>
    <td WIDTH="88" VALIGN="TOP" COLSPAN="2" align="right" height="16"><font SIZE="1">
      <p style="margin-right: 20">722</font></td>
    <td WIDTH="9" VALIGN="TOP" align="right" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="98" VALIGN="TOP" COLSPAN="2" align="right" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
      </td>
    <td WIDTH="97" VALIGN="TOP" COLSPAN="2" align="right" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
      </td>
    <td WIDTH="23" VALIGN="TOP" align="right" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
      </td>
    <td WIDTH="95" VALIGN="TOP" COLSPAN="3" align="right" height="16"><font SIZE="1">
      <p style="margin-right: 20">722</font></td>
    <td WIDTH="8" VALIGN="TOP" height="16"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="292" VALIGN="TOP" height="16"><font SIZE="1">
      <p>Debt</font></td>
    <td WIDTH="88" VALIGN="TOP" COLSPAN="2" align="right" height="16"><font SIZE="1">
      <p style="margin-right: 20">4,886</font></td>
    <td WIDTH="9" VALIGN="TOP" align="right" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="98" VALIGN="TOP" COLSPAN="2" align="right" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
      </td>
    <td WIDTH="97" VALIGN="TOP" COLSPAN="2" align="right" height="16">
      <p style="margin-right: 20"><font size="1">77 (<a href="#noted">D</a>)</font></td>
    <td WIDTH="23" VALIGN="TOP" align="right" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
      </td>
    <td WIDTH="95" VALIGN="TOP" COLSPAN="3" align="right" height="16"><font SIZE="1">
      <p style="margin-right: 20">4,963</font></td>
    <td WIDTH="8" VALIGN="TOP" height="16"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="294" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="16"><font SIZE="1">
      <p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Total
      Textron Finance liabilities</font></td>
    <td WIDTH="90" VALIGN="TOP" COLSPAN="2" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="16"><font SIZE="1">
      <p style="margin-right: 20">5,608</font></td>
    <td WIDTH="11" VALIGN="TOP" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="100" VALIGN="TOP" COLSPAN="2" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
      </td>
    <td WIDTH="99" VALIGN="TOP" COLSPAN="2" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="16"><font SIZE="1">
      <p style="margin-right: 40">77</font></td>
    <td WIDTH="25" VALIGN="TOP" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
      </td>
    <td WIDTH="97" VALIGN="TOP" COLSPAN="3" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="16"><font SIZE="1">
      <p style="margin-right: 20">5,685</font></td>
    <td WIDTH="10" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="16"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="294" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1" height="15"><font SIZE="1">
      <p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Total
      liabilities</font></td>
    <td WIDTH="90" VALIGN="TOP" COLSPAN="2" align="right" style="border-bottom-style: solid; border-bottom-width: 1" height="15"><font SIZE="1">
      <p style="margin-right: 20">12,895</font></td>
    <td WIDTH="11" VALIGN="TOP" align="right" style="border-bottom-style: solid; border-bottom-width: 1" height="15"><font size="1">&nbsp;</font></td>
    <td WIDTH="100" VALIGN="TOP" COLSPAN="2" align="right" style="border-bottom-style: solid; border-bottom-width: 1" height="15"><font SIZE="1">
      <p style="margin-right: 20">(567)</font></td>
    <td WIDTH="99" VALIGN="TOP" COLSPAN="2" align="right" style="border-bottom-style: solid; border-bottom-width: 1" height="15"><font SIZE="1">
      <p style="margin-right: 40">(98)</font></td>
    <td WIDTH="25" VALIGN="TOP" align="right" style="border-bottom-style: solid; border-bottom-width: 1" height="15">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
      </td>
    <td WIDTH="97" VALIGN="TOP" COLSPAN="3" align="right" style="border-bottom-style: solid; border-bottom-width: 1" height="15"><font SIZE="1">
      <p style="margin-right: 20">12,230</font></td>
    <td WIDTH="10" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1" height="15"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="292" VALIGN="TOP" height="41"><b><font SIZE="1">
      <p>Textron Finance &#45; mandatorily redeemable preferred<br>
      &#160;&#160;&#160;&#160;&#160;securities of Finance
      subsidiary holding debentures</font></b></td>
    <td WIDTH="88" VALIGN="TOP" COLSPAN="2" align="right" height="41"><font SIZE="1">
      <p style="margin-right: 20"><br>
      28</font></td>
    <td WIDTH="9" VALIGN="TOP" align="right" height="41"><font size="1">&nbsp;</font></td>
    <td WIDTH="98" VALIGN="TOP" COLSPAN="2" align="right" height="41">
      <p style="margin-right: 20"></p>
      </td>
    <td WIDTH="97" VALIGN="TOP" COLSPAN="2" align="right" height="41"><font SIZE="1">
      <p style="margin-right: 20"><br>
      </font></td>
    <td WIDTH="23" VALIGN="TOP" align="right" height="41">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
      </td>
    <td WIDTH="95" VALIGN="TOP" COLSPAN="3" align="right" height="41"><font SIZE="1">
      <p style="margin-right: 20"><br>
      28</font></td>
    <td WIDTH="8" VALIGN="TOP" height="41"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="294" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="44"><b><font SIZE="1">
      <p>Textron &#45; obligated mandatorily redeemable<br>
      &#160;&#160;&#160;&#160;&#160;preferred securities of
      subsidiary trust holding<br>
      &#160;&#160;&#160;&#160;&#160;solely Textron junior
      subordinated debt securities</font></b></td>
    <td WIDTH="90" VALIGN="TOP" COLSPAN="2" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="44"><font SIZE="1">
      <p style="margin-right: 20"><br>
      <br>
      485</font></td>
    <td WIDTH="11" VALIGN="TOP" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="44"><font size="1">&nbsp;</font></td>
    <td WIDTH="100" VALIGN="TOP" COLSPAN="2" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="44">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
      </td>
    <td WIDTH="99" VALIGN="TOP" COLSPAN="2" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="44"><font SIZE="1">
      <p style="margin-right: 20"><br>
      <br>
      </font></td>
    <td WIDTH="25" VALIGN="TOP" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="44">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
      </td>
    <td WIDTH="97" VALIGN="TOP" COLSPAN="3" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="44"><font SIZE="1">
      <p style="margin-right: 20"><br>
      <br>
      485</font></td>
    <td WIDTH="10" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" height="44"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="292" VALIGN="TOP" height="15"><b><font SIZE="1">
      <p>Shareholders&#39; equity</font></b></td>
    <td WIDTH="88" VALIGN="TOP" COLSPAN="2" align="right" height="15">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
    </td>
    <td WIDTH="9" VALIGN="TOP" align="right" height="15"><font size="1">&nbsp;</font></td>
    <td WIDTH="98" VALIGN="TOP" COLSPAN="2" align="right" height="15">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
    </td>
    <td WIDTH="97" VALIGN="TOP" COLSPAN="2" align="right" height="15">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
    </td>
    <td WIDTH="23" VALIGN="TOP" align="right" height="15">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
    </td>
    <td WIDTH="95" VALIGN="TOP" COLSPAN="3" align="right" height="15">
      <p style="margin-right: 20" align="right"><font size="1">&nbsp;</font></p>
    </td>
    <td WIDTH="8" VALIGN="TOP" height="15"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="292" VALIGN="TOP" height="16"><font SIZE="1">
      <p>Capital stock:</font></td>
    <td WIDTH="88" VALIGN="TOP" COLSPAN="2" align="right" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
    </td>
    <td WIDTH="9" VALIGN="TOP" align="right" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="98" VALIGN="TOP" COLSPAN="2" align="right" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
    </td>
    <td WIDTH="97" VALIGN="TOP" COLSPAN="2" align="right" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
    </td>
    <td WIDTH="23" VALIGN="TOP" align="right" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
    </td>
    <td WIDTH="95" VALIGN="TOP" COLSPAN="3" align="right" height="16">
      <p style="margin-right: 20" align="right"><font size="1">&nbsp;</font></p>
    </td>
    <td WIDTH="8" VALIGN="TOP" height="16"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="292" VALIGN="TOP" height="16"><font SIZE="1">
      <p>&#160;&#160;&#160;&#160;&#160;Preferred stock</font></td>
    <td WIDTH="88" VALIGN="TOP" COLSPAN="2" align="right" height="16"><font SIZE="1">
      <p style="margin-right: 20">11</font></td>
    <td WIDTH="9" VALIGN="TOP" align="right" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="98" VALIGN="TOP" COLSPAN="2" align="right" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
      </td>
    <td WIDTH="97" VALIGN="TOP" COLSPAN="2" align="right" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
      </td>
    <td WIDTH="23" VALIGN="TOP" align="right" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
      </td>
    <td WIDTH="95" VALIGN="TOP" COLSPAN="3" align="right" height="16"><font SIZE="1">
      <p style="margin-right: 20" align="right">11</font></td>
    <td WIDTH="8" VALIGN="TOP" height="16"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="292" VALIGN="TOP" height="16"><font SIZE="1">
      <p>&#160;&#160;&#160;&#160;&#160;Common stock</font></td>
    <td WIDTH="88" VALIGN="TOP" COLSPAN="2" align="right" height="16"><font SIZE="1">
      <p style="margin-right: 20">25</font></td>
    <td WIDTH="9" VALIGN="TOP" align="right" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="98" VALIGN="TOP" COLSPAN="2" align="right" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
      </td>
    <td WIDTH="97" VALIGN="TOP" COLSPAN="2" align="right" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
      </td>
    <td WIDTH="23" VALIGN="TOP" align="right" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
      </td>
    <td WIDTH="95" VALIGN="TOP" COLSPAN="3" align="right" height="16"><font SIZE="1">
      <p style="margin-right: 20" align="right">25</font></td>
    <td WIDTH="8" VALIGN="TOP" height="16"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="292" VALIGN="TOP" height="16"><font SIZE="1">
      <p>Capital surplus</font></td>
    <td WIDTH="88" VALIGN="TOP" COLSPAN="2" align="right" height="16"><font SIZE="1">
      <p style="margin-right: 20">1,059</font></td>
    <td WIDTH="9" VALIGN="TOP" align="right" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="98" VALIGN="TOP" COLSPAN="2" align="right" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
      </td>
    <td WIDTH="97" VALIGN="TOP" COLSPAN="2" align="right" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
      </td>
    <td WIDTH="23" VALIGN="TOP" align="right" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
      </td>
    <td WIDTH="95" VALIGN="TOP" COLSPAN="3" align="right" height="16"><font SIZE="1">
      <p style="margin-right: 20" align="right">1,059</font></td>
    <td WIDTH="8" VALIGN="TOP" height="16"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="292" VALIGN="TOP" height="16"><font SIZE="1">
      <p>Retained earnings</font></td>
    <td WIDTH="88" VALIGN="TOP" COLSPAN="2" align="right" height="16"><font SIZE="1">
      <p style="margin-right: 20">5,618</font></td>
    <td WIDTH="9" VALIGN="TOP" align="right" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="98" VALIGN="TOP" COLSPAN="2" align="right" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
      </td>
    <td WIDTH="97" VALIGN="TOP" COLSPAN="2" align="right" height="16">
      <p style="margin-right: 20"><font size="1">242 (<a href="#noteh">H</a>)</font></td>
    <td WIDTH="23" VALIGN="TOP" align="right" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
      </td>
    <td WIDTH="95" VALIGN="TOP" COLSPAN="3" align="right" height="16"><font SIZE="1">
      <p style="margin-right: 20" align="right">5,860</font></td>
    <td WIDTH="8" VALIGN="TOP" height="16"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="294" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1" height="15"><font SIZE="1">
      <p>Accumulated other comprehensive loss</font></td>
    <td WIDTH="90" VALIGN="TOP" COLSPAN="2" align="right" style="border-bottom-style: solid; border-bottom-width: 1" height="15"><font SIZE="1">
      <p style="margin-right: 20">(214)</font></td>
    <td WIDTH="11" VALIGN="TOP" align="right" style="border-bottom-style: solid; border-bottom-width: 1" height="15"><font size="1">&nbsp;</font></td>
    <td WIDTH="100" VALIGN="TOP" COLSPAN="2" align="right" style="border-bottom-style: solid; border-bottom-width: 1" height="15">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
      </td>
    <td WIDTH="99" VALIGN="TOP" COLSPAN="2" align="right" style="border-bottom-style: solid; border-bottom-width: 1" height="15">
      <p style="margin-right: 20"><font size="1">(8) (<a href="#noteh">H</a>)</font></td>
    <td WIDTH="25" VALIGN="TOP" align="right" style="border-bottom-style: solid; border-bottom-width: 1" height="15">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
      </td>
    <td WIDTH="97" VALIGN="TOP" COLSPAN="3" align="right" style="border-bottom-style: solid; border-bottom-width: 1" height="15"><font SIZE="1">
      <p style="margin-right: 20" align="right">(222)</font></td>
    <td WIDTH="10" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1" height="15"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="292" VALIGN="TOP" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="88" VALIGN="TOP" COLSPAN="2" align="right" height="16"><font SIZE="1">
      <p style="margin-right: 20">6,499</font></td>
    <td WIDTH="9" VALIGN="TOP" align="right" height="16"><font size="1">&nbsp;</font></td>
    <td WIDTH="98" VALIGN="TOP" COLSPAN="2" align="right" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
    </td>
    <td WIDTH="97" VALIGN="TOP" COLSPAN="2" align="right" height="16"><font SIZE="1">
      <p style="margin-right: 40">234</font></td>
    <td WIDTH="23" VALIGN="TOP" align="right" height="16">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
    </td>
    <td WIDTH="95" VALIGN="TOP" COLSPAN="3" align="right" height="16"><font SIZE="1">
      <p style="margin-right: 20" align="right">6,733</font></td>
    <td WIDTH="8" VALIGN="TOP" height="16"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="294" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1" height="15"><font SIZE="1">
      <p>&#160;&#160;&#160;&#160;&#160;Less cost of treasury
      shares</font></td>
    <td WIDTH="90" VALIGN="TOP" COLSPAN="2" align="right" style="border-bottom-style: solid; border-bottom-width: 1" height="15"><font SIZE="1">
      <p style="margin-right: 20">2,769</font></td>
    <td WIDTH="11" VALIGN="TOP" align="right" style="border-bottom-style: solid; border-bottom-width: 1" height="15"><font size="1">&nbsp;</font></td>
    <td WIDTH="100" VALIGN="TOP" COLSPAN="2" align="right" style="border-bottom-style: solid; border-bottom-width: 1" height="15">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
      </td>
    <td WIDTH="99" VALIGN="TOP" COLSPAN="2" align="right" style="border-bottom-style: solid; border-bottom-width: 1" height="15">
      <p style="margin-right: 40"><font size="1">&nbsp;</font></p>
      </td>
    <td WIDTH="25" VALIGN="TOP" align="right" style="border-bottom-style: solid; border-bottom-width: 1" height="15">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
      </td>
    <td WIDTH="97" VALIGN="TOP" COLSPAN="3" align="right" style="border-bottom-style: solid; border-bottom-width: 1" height="15"><font SIZE="1">
      <p style="margin-right: 20" align="right">2,769</font></td>
    <td WIDTH="10" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1" height="15"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="292" VALIGN="TOP" HEIGHT="21"><font SIZE="1">
      <p>&#160;&#160;&#160;&#160;&#160;Total
      shareholders&#39; equity</font></td>
    <td WIDTH="88" VALIGN="TOP" COLSPAN="2" HEIGHT="21" align="right"><font SIZE="1">
      <p style="margin-right: 20">3,730</font></td>
    <td WIDTH="9" VALIGN="TOP" HEIGHT="21" align="right">
      <p></p>
    </td>
    <td WIDTH="98" VALIGN="TOP" COLSPAN="2" HEIGHT="21" align="right">
      <p style="margin-right: 20"></p>
    </td>
    <td WIDTH="97" VALIGN="TOP" COLSPAN="2" HEIGHT="21" align="right"><font SIZE="1">
      <p style="margin-right: 40">234</font></td>
    <td WIDTH="23" VALIGN="TOP" HEIGHT="21" align="right">
      <p style="margin-right: 20"></p>
    </td>
    <td WIDTH="95" VALIGN="TOP" COLSPAN="3" HEIGHT="21" align="right"><font SIZE="1">
      <p style="margin-right: 20" align="right">3,964</font></td>
    <td WIDTH="8" VALIGN="TOP" HEIGHT="21">
      <p></p>
    </td>
  </tr>
  <tr>
    <td WIDTH="294" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1" height="15"><font SIZE="1">
      <p>&#160;&#160;&#160;&#160;&#160;Total liabilities and
      shareholders&#39; equity</font></td>
    <td WIDTH="10" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1" height="15"><font SIZE="1">
      <p ALIGN="RIGHT">$</font></td>
    <td WIDTH="76" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1" height="15"><font SIZE="1">
      <p align="right" style="margin-right: 20">17,138</font></td>
    <td WIDTH="11" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1" height="15"><font size="1">&nbsp;</font></td>
    <td WIDTH="20" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1" height="15"><font SIZE="1">
      <p>$</font></td>
    </center>
    <td WIDTH="76" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1" height="15"><font SIZE="1">
      <p align="right" style="margin-right: 20">(567)</font></td>
      <center>
    <td WIDTH="13" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1" height="15"><font SIZE="1">
      <p ALIGN="RIGHT">$</font></td>
      </center>
    <td WIDTH="82" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1" height="15"><font SIZE="1">
      <p align="right" style="margin-right: 40">136</font></td>
      <center>
    <td WIDTH="25" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1" height="15"><font size="1">&nbsp;</font></td>
    <td WIDTH="17" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1" height="15"><font SIZE="1">
      <p ALIGN="RIGHT">$</font></td>
      </center>
    <td WIDTH="76" VALIGN="TOP" COLSPAN="2" style="border-top-style: solid; border-top-width: 1" height="15"><font SIZE="1">
      <p align="right" style="margin-right: 20">16,707</font></td>
      <center>
    <td WIDTH="10" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1" height="15"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="294" VALIGN="TOP" style="border-top-style: solid; border-bottom-style: solid" height="22"><font SIZE="1">
      <p>Common shares outstanding</font></td>
    <td WIDTH="90" VALIGN="TOP" COLSPAN="2" align="right" style="border-top-style: solid; border-bottom-style: solid" height="22"><font SIZE="1">
      <p style="margin-right: 20">141,227,000</font></td>
    <td WIDTH="11" VALIGN="TOP" align="right" style="border-top-style: solid; border-bottom-style: solid" height="22"><font size="1">&nbsp;</font></td>
    <td WIDTH="100" VALIGN="TOP" COLSPAN="2" align="right" style="border-top-style: solid; border-bottom-style: solid" height="22"><font size="1">&nbsp;</font></td>
    <td WIDTH="99" VALIGN="TOP" COLSPAN="2" align="right" style="border-top-style: solid; border-bottom-style: solid" height="22"><font size="1">&nbsp;</font></td>
    <td WIDTH="25" VALIGN="TOP" align="right" style="border-top-style: solid; border-bottom-style: solid" height="22"><font size="1">&nbsp;</font></td>
    <td WIDTH="97" VALIGN="TOP" COLSPAN="3" align="right" style="border-top-style: solid; border-bottom-style: solid" height="22"><font SIZE="1">
      <p align="RIGHT" style="margin-right: 20">141,227,000</font></td>
    <td WIDTH="10" VALIGN="TOP" style="border-top-style: solid; border-bottom-style: solid" height="22"><font size="1">&nbsp;</font></td>
  </tr>
</table>
      </center>
    </div>
<i><font SIZE="2">
<blockquote>
  <blockquote>
<p>See notes to pro forma condensed consolidated financial statements.</p>
  </blockquote>
</blockquote>
</font></i><b>
<p ALIGN="CENTER">TEXTRON INC.<br>
Pro Forma Condensed Consolidated Statement of Operations (unaudited)<br>
or the Year Ended December 30, 2000</b><br>
(Dollars in millions, except per share amounts)<br>
</p>
<div align="center">
  <center>
<table CELLSPACING="1" CELLPADDING="1" WIDTH="728">
  <tr>
    <td WIDTH="238" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1"><font size="1">&nbsp;</font></td>
    <td WIDTH="103" VALIGN="TOP" colspan="2" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
      <p align="center"><font size="1"><br>
      <br>
      Textron Inc.</font></td>
    <td WIDTH="89" VALIGN="TOP" colspan="2" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1"><font size="1"><br>
      Automotive Trim<br>
      Business (<a href="#notea">A</a>)</font></td>
    <td WIDTH="95" VALIGN="TOP" colspan="2" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
      <p align="center"><font size="1"><br>
      Pro Forma<br>
      Adjustments</font></td>
    <td WIDTH="89" VALIGN="TOP" colspan="2" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
      <p align="center"><font size="1"><br>
      Adjusted Pro Forma</font></td>
    <td WIDTH="38" VALIGN="TOP"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="238" VALIGN="TOP"><b><font SIZE="1">
      <p>Revenues</font></b></td>
    <td WIDTH="9" VALIGN="TOP"><font size="1">&nbsp;</font></td>
    <td WIDTH="82" VALIGN="TOP"><font size="1">&nbsp;</font></td>
    <td WIDTH="9" VALIGN="TOP"><font size="1">&nbsp;</font></td>
    <td WIDTH="68" VALIGN="TOP"><font size="1">&nbsp;</font></td>
    <td WIDTH="6" VALIGN="TOP"><font size="1">&nbsp;</font></td>
    <td WIDTH="77" VALIGN="TOP"><font size="1">&nbsp;</font></td>
    <td WIDTH="10" VALIGN="TOP"><font size="1">&nbsp;</font></td>
    <td WIDTH="67" VALIGN="TOP"><font size="1">&nbsp;</font></td>
    <td WIDTH="38" VALIGN="TOP"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="238" VALIGN="TOP"><font SIZE="1">
      <p>Manufacturing revenues</font></td>
    <td WIDTH="9" VALIGN="TOP" align="right"><font SIZE="1">
      <p ALIGN="RIGHT">$</font></td>
    <td WIDTH="82" VALIGN="TOP" align="right"><font SIZE="1">
      <p style="margin-right: 5">12,399</font></td>
    <td WIDTH="9" VALIGN="TOP" align="right"><font SIZE="1">
      <p ALIGN="RIGHT">$</font></td>
    <td WIDTH="68" VALIGN="TOP" align="right"><font SIZE="1">
      <p style="margin-right: 10">(1,842)</font></td>
    <td WIDTH="6" VALIGN="TOP" align="right"><font SIZE="1">
      <p ALIGN="RIGHT">$</font></td>
    <td WIDTH="77" VALIGN="TOP" align="right">
      <p style="margin-right: 10"><font size="1">&nbsp;</font></td>
    <td WIDTH="10" VALIGN="TOP" align="right"><font SIZE="1">
      <p ALIGN="RIGHT">$</font></td>
    <td WIDTH="67" VALIGN="TOP" align="right"><font SIZE="1">
      <p style="margin-right: 10">10,557</font></td>
    <td WIDTH="38" VALIGN="TOP"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="238" VALIGN="TOP"><font SIZE="1">
      <p>Finance revenues</font></td>
    <td WIDTH="9" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="82" VALIGN="TOP" align="right"><font SIZE="1">
      <p style="margin-right: 5">691</font></td>
    <td WIDTH="9" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="68" VALIGN="TOP" align="right">
      <p style="margin-right: 10"><font size="1">&nbsp;</font></p>
    </td>
    <td WIDTH="6" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="77" VALIGN="TOP" align="right">
      <p style="margin-right: 10"><font size="1">8 (<a href="#notei">I</a>)</font></td>
    <td WIDTH="10" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="67" VALIGN="TOP" align="right"><font SIZE="1">
      <p style="margin-right: 10">699</font></td>
    <td WIDTH="38" VALIGN="TOP"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="238" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1"><font SIZE="1">
      <p>&#160;&#160;&#160;&#160;&#160;Total revenues</font></td>
    <td WIDTH="9" VALIGN="TOP" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1"><font size="1">&nbsp;</font></td>
    <td WIDTH="82" VALIGN="TOP" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1"><font SIZE="1">
      <p style="margin-right: 5">13,090</font></td>
    <td WIDTH="9" VALIGN="TOP" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1"><font size="1">&nbsp;</font></td>
    <td WIDTH="68" VALIGN="TOP" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1"><font SIZE="1">
      <p style="margin-right: 10">(1,842)</font></td>
    <td WIDTH="6" VALIGN="TOP" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1"><font size="1">&nbsp;</font></td>
    <td WIDTH="77" VALIGN="TOP" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
      <p style="margin-right: 25"><font size="1">8</font></td>
    <td WIDTH="10" VALIGN="TOP" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1"><font size="1">&nbsp;</font></td>
    <td WIDTH="67" VALIGN="TOP" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1"><font SIZE="1">
      <p style="margin-right: 10">11,256</font></td>
    <td WIDTH="38" VALIGN="TOP"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="238" VALIGN="TOP"><b><font SIZE="1">
      <p>Costs and expenses</font></b></td>
    <td WIDTH="9" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="82" VALIGN="TOP" align="right">
      <p style="margin-right: 5"><font size="1">&nbsp;</font></p>
    </td>
    <td WIDTH="9" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="68" VALIGN="TOP" align="right">
      <p style="margin-right: 10"><font size="1">&nbsp;</font></p>
    </td>
    <td WIDTH="6" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="77" VALIGN="TOP" align="right">
      <p style="margin-right: 10"><font size="1">&nbsp;</font></p>
    </td>
    <td WIDTH="10" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="67" VALIGN="TOP" align="right">
      <p style="margin-right: 10"><font size="1">&nbsp;</font></p>
    </td>
    <td WIDTH="38" VALIGN="TOP"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="238" VALIGN="TOP"><font SIZE="1">
      <p>Cost of sales</font></td>
    <td WIDTH="9" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="82" VALIGN="TOP" align="right"><font SIZE="1">
      <p style="margin-right: 5">10,065</font></td>
    <td WIDTH="9" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="68" VALIGN="TOP" align="right"><font SIZE="1">
      <p style="margin-right: 10">(1,602)</font></td>
    <td WIDTH="6" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="77" VALIGN="TOP" align="right">
    </td>
    <td WIDTH="10" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="67" VALIGN="TOP" align="right"><font SIZE="1">
      <p style="margin-right: 10">8,463</font></td>
    <td WIDTH="38" VALIGN="TOP"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="238" VALIGN="TOP"><font SIZE="1">
      <p>Selling and administrative</font></td>
    <td WIDTH="9" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="82" VALIGN="TOP" align="right"><font SIZE="1">
      <p style="margin-right: 5">1,445</font></td>
    <td WIDTH="9" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="68" VALIGN="TOP" align="right"><font SIZE="1">
      <p style="margin-right: 10">(84)</font></td>
    <td WIDTH="6" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="77" VALIGN="TOP" align="right">
      <p style="margin-right: 0"><font size="1">&nbsp;(12) (<a href="#notej">J</a>)&nbsp;</font></p>
    </td>
    <td WIDTH="10" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="67" VALIGN="TOP" align="right"><font SIZE="1">
      <p style="margin-right: 10">1,349</font></td>
    <td WIDTH="38" VALIGN="TOP"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="238" VALIGN="TOP"><font SIZE="1">
      <p>Interest, net</font></td>
    <td WIDTH="9" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="82" VALIGN="TOP" align="right"><font SIZE="1">
      <p style="margin-right: 5">486</font></td>
    <td WIDTH="9" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="68" VALIGN="TOP" align="right">
      <p style="margin-right: 10"><font size="1">&nbsp;</font></p>
    </td>
    <td WIDTH="6" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="77" VALIGN="TOP" align="right">
      <p style="margin-right: 0"><font size="1">(24) (<a href="#notek">K</a>)</font></td>
    <td WIDTH="10" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="67" VALIGN="TOP" align="right"><font SIZE="1">
      <p style="margin-right: 10">462</font></td>
    <td WIDTH="38" VALIGN="TOP"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="238" VALIGN="TOP"><font SIZE="1">
      <p>Special charges, net</font></td>
    <td WIDTH="9" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="82" VALIGN="TOP" align="right"><font SIZE="1">
      <p style="margin-right: 5">483</font></td>
    <td WIDTH="9" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="68" VALIGN="TOP" align="right"><font SIZE="1">
      <p style="margin-right: 10">(27)</font></td>
    <td WIDTH="6" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="77" VALIGN="TOP" align="right">
      <p style="margin-right: 10"><font size="1">&nbsp;</font></p>
    </td>
    <td WIDTH="10" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="67" VALIGN="TOP" align="right"><font SIZE="1">
      <p style="margin-right: 10">456</font></td>
    <td WIDTH="38" VALIGN="TOP"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="238" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1"><font SIZE="1">
      <p>&#160;&#160;&#160;&#160;&#160;Total costs and
      expenses</font></td>
    <td WIDTH="9" VALIGN="TOP" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1"><font size="1">&nbsp;</font></td>
    <td WIDTH="82" VALIGN="TOP" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1"><font SIZE="1">
      <p style="margin-right: 5">12,479</font></td>
    <td WIDTH="9" VALIGN="TOP" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1"><font size="1">&nbsp;</font></td>
    <td WIDTH="68" VALIGN="TOP" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1"><font SIZE="1">
      <p style="margin-right: 10">(1,713)</font></td>
    <td WIDTH="6" VALIGN="TOP" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1"><font size="1">&nbsp;</font></td>
    <td WIDTH="77" VALIGN="TOP" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1"><font SIZE="1">
      <p style="margin-right: 10">(36)&nbsp;&nbsp;&nbsp;</font></td>
    <td WIDTH="10" VALIGN="TOP" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1"><font size="1">&nbsp;</font></td>
    <td WIDTH="67" VALIGN="TOP" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1"><font SIZE="1">
      <p style="margin-right: 10">10,730</font></td>
    <td WIDTH="38" VALIGN="TOP"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="238" VALIGN="TOP"><font SIZE="1">
      <p>Income from&nbsp; continuing operations before income<br>
      &nbsp;&nbsp;&nbsp;&nbsp; taxes&#160;and distributions on
      preferred securities of<br>
      &#160;&#160;&#160;&#160;&#160;subsidiary trusts</font></td>
    <td WIDTH="9" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="82" VALIGN="TOP" align="right"><font SIZE="1">
      <p style="margin-right: 5"><br>
      <br>
      611</font></td>
    <td WIDTH="9" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="68" VALIGN="TOP" align="right"><font SIZE="1">
      <p style="margin-right: 10"><br>
      <br>
      (129)</font></td>
    <td WIDTH="6" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="77" VALIGN="TOP" align="right"><font SIZE="1">
      <p style="margin-right: 10"><br>
      <br>
      44&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
    <td WIDTH="10" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="67" VALIGN="TOP" align="right"><font SIZE="1">
      <p style="margin-right: 10"><br>
      <br>
      526</font></td>
    <td WIDTH="38" VALIGN="TOP"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="238" VALIGN="TOP"><font SIZE="1">
      <p>Provision for income taxes</font></td>
    <td WIDTH="9" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="82" VALIGN="TOP" align="right"><font SIZE="1">
      <p style="margin-right: 5">(308)</font></td>
    <td WIDTH="9" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="68" VALIGN="TOP" align="right"><font SIZE="1">
      <p style="margin-right: 10">60</font></td>
    <td WIDTH="6" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="77" VALIGN="TOP" align="right">
      <p style="margin-right: 0"><font size="1">(16) (<a href="#notel">L</a>)</font></td>
    <td WIDTH="10" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="67" VALIGN="TOP" align="right"><font SIZE="1">
      <p style="margin-right: 10">(264)</font></td>
    <td WIDTH="38" VALIGN="TOP"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="238" VALIGN="TOP"><font SIZE="1">
      <p>Distribution on preferred securities of<br>
      &#160;&#160;&#160;&#160;&#160;subsidiary trusts, net
      of income taxes</font></td>
    <td WIDTH="9" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="82" VALIGN="TOP" align="right"><font SIZE="1">
      <p style="margin-right: 5"><br>
      (26)</font></td>
    <td WIDTH="9" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="68" VALIGN="TOP" align="right"><font SIZE="1">
      <p style="margin-right: 10"><br>
      </font></td>
    <td WIDTH="6" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="77" VALIGN="TOP" align="right"><font SIZE="1">
      <p style="margin-right: 10"><br>
      </font></td>
    <td WIDTH="10" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="67" VALIGN="TOP" align="right"><font SIZE="1">
      <p style="margin-right: 10"><br>
      (26)</font></td>
    <td WIDTH="38" VALIGN="TOP"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="238" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid"><font SIZE="1">
      <p>Income from continuing continuing operations</font></td>
    <td WIDTH="9" VALIGN="TOP" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid"><font SIZE="1">
      <p ALIGN="RIGHT">$</font></td>
    <td WIDTH="82" VALIGN="TOP" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid"><font SIZE="1">
      <p style="margin-right: 5">277</font></td>
    <td WIDTH="9" VALIGN="TOP" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid"><font SIZE="1">
      <p ALIGN="RIGHT">$</font></td>
    <td WIDTH="68" VALIGN="TOP" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid"><font SIZE="1">
      <p style="margin-right: 10">(69)</font></td>
    <td WIDTH="6" VALIGN="TOP" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid"><font SIZE="1">
      <p ALIGN="RIGHT">$</font></td>
    <td WIDTH="77" VALIGN="TOP" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid"><font SIZE="1">
      <p style="margin-right: 10">28&nbsp;&nbsp;&nbsp;</font></td>
    <td WIDTH="10" VALIGN="TOP" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid"><font SIZE="1">
      <p ALIGN="RIGHT">$</font></td>
    <td WIDTH="67" VALIGN="TOP" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid"><font SIZE="1">
      <p style="margin-right: 10">236</font></td>
    <td WIDTH="38" VALIGN="TOP"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="238" VALIGN="TOP"><font SIZE="1">
      <p>Income from continuing operations per common<br>
      &nbsp;&nbsp;&nbsp;&nbsp; share:</font></td>
    <td WIDTH="9" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="82" VALIGN="TOP" align="right">
      <p style="margin-right: 5"><font size="1">&nbsp;</font></p>
    </td>
    <td WIDTH="9" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="68" VALIGN="TOP" align="right">
      <p style="margin-right: 10"><font size="1">&nbsp;</font></p>
    </td>
    <td WIDTH="6" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="77" VALIGN="TOP" align="right">
      <p style="margin-right: 10"><font size="1">&nbsp;</font></p>
    </td>
    <td WIDTH="10" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="67" VALIGN="TOP" align="right">
      <p style="margin-right: 10"><font size="1">&nbsp;</font></p>
    </td>
    <td WIDTH="38" VALIGN="TOP"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="238" VALIGN="TOP"><font SIZE="1">
      <p>&#160;&#160;&#160;&#160;&nbsp;&nbsp;&nbsp;&nbsp; &#160;Basic</font></td>
    <td WIDTH="9" VALIGN="TOP" align="right"><font SIZE="1">
      <p ALIGN="RIGHT">$</font></td>
    <td WIDTH="82" VALIGN="TOP" align="right"><font SIZE="1">
      <p style="margin-right: 5">1.92</font></td>
    <td WIDTH="9" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="68" VALIGN="TOP" align="right">
      <p style="margin-right: 10"><font size="1">&nbsp;</font></p>
      </td>
    <td WIDTH="6" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="77" VALIGN="TOP" align="right">
      <p style="margin-right: 10"><font size="1">&nbsp;</font></p>
      </td>
    <td WIDTH="10" VALIGN="TOP" align="right"><font SIZE="1">
      <p ALIGN="RIGHT">$</font></td>
    <td WIDTH="67" VALIGN="TOP" align="right"><font SIZE="1">
      <p style="margin-right: 10">1.67</font></td>
    <td WIDTH="38" VALIGN="TOP"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="238" VALIGN="TOP" style="border-bottom-style: solid"><font SIZE="1">
      <p>&#160;&#160;&#160;&#160;&nbsp;&nbsp;&nbsp;&nbsp; &#160;Diluted</font></td>
    <td WIDTH="9" VALIGN="TOP" align="right" style="border-bottom-style: solid"><font SIZE="1">
      <p ALIGN="RIGHT">$</font></td>
    <td WIDTH="82" VALIGN="TOP" align="right" style="border-bottom-style: solid"><font SIZE="1">
      <p style="margin-right: 5">1.90</font></td>
    <td WIDTH="9" VALIGN="TOP" align="right" style="border-bottom-style: solid"><font size="1">&nbsp;</font></td>
    <td WIDTH="68" VALIGN="TOP" align="right" style="border-bottom-style: solid"><font size="1">&nbsp;</font></td>
    <td WIDTH="6" VALIGN="TOP" align="right" style="border-bottom-style: solid"><font size="1">&nbsp;</font></td>
    <td WIDTH="77" VALIGN="TOP" align="right" style="border-bottom-style: solid">
      <p style="margin-right: 10"><font size="1">&nbsp;</font></p>
      </td>
    <td WIDTH="10" VALIGN="TOP" align="right" style="border-bottom-style: solid"><font SIZE="1">
      <p ALIGN="RIGHT">$</font></td>
    <td WIDTH="67" VALIGN="TOP" align="right" style="border-bottom-style: solid"><font SIZE="1">
      <p style="margin-right: 10">1.64</font></td>
    <td WIDTH="38" VALIGN="TOP"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="238" VALIGN="TOP"><font SIZE="1">
      <p>Average shares outstanding:</font></td>
    <td WIDTH="9" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="82" VALIGN="TOP" align="right">
      <p style="margin-right: 5"><font size="1">&nbsp;</font></p>
    </td>
    <td WIDTH="9" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="68" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="6" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="77" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="10" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="67" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="38" VALIGN="TOP"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="238" VALIGN="TOP"><font SIZE="1">
      <p>&#160;&#160;&#160;&#160;&#160;Basic</font></td>
    <td WIDTH="9" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="82" VALIGN="TOP" align="right"><font SIZE="1">
      <p>143,923,000</font></td>
    <td WIDTH="9" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="68" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="6" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="77" VALIGN="TOP" align="right">
      <p ALIGN="JUSTIFY"><font size="1">(2,336,000) (<a href="#notem">M</a>)</font></td>
    <td WIDTH="10" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="67" VALIGN="TOP" align="right"><font SIZE="1">
      <p ALIGN="JUSTIFY">141,587,000</font></td>
    <td WIDTH="38" VALIGN="TOP"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="238" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1"><font SIZE="1">
      <p>&#160;&#160;&#160;&#160;&#160;Diluted</font></td>
    <td WIDTH="9" VALIGN="TOP" align="right" style="border-bottom-style: solid; border-bottom-width: 1"><font size="1">&nbsp;</font></td>
    <td WIDTH="82" VALIGN="TOP" align="right" style="border-bottom-style: solid; border-bottom-width: 1"><font SIZE="1">
      <p>146,150,000</font></td>
    <td WIDTH="9" VALIGN="TOP" align="right" style="border-bottom-style: solid; border-bottom-width: 1"><font size="1">&nbsp;</font></td>
    <td WIDTH="68" VALIGN="TOP" align="right" style="border-bottom-style: solid; border-bottom-width: 1"><font size="1">&nbsp;</font></td>
    <td WIDTH="6" VALIGN="TOP" align="right" style="border-bottom-style: solid; border-bottom-width: 1"><font size="1">&nbsp;</font></td>
    <td WIDTH="77" VALIGN="TOP" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
      <p ALIGN="JUSTIFY"><font size="1">(2,336,000) (<a href="#notem">M</a>)</font></td>
    <td WIDTH="10" VALIGN="TOP" align="right" style="border-bottom-style: solid; border-bottom-width: 1"><font size="1">&nbsp;</font></td>
    <td WIDTH="67" VALIGN="TOP" align="right" style="border-bottom-style: solid; border-bottom-width: 1"><font SIZE="1">
      <p ALIGN="JUSTIFY">143,814,000</font></td>
    <td WIDTH="38" VALIGN="TOP"><font size="1">&nbsp;</font></td>
  </tr>
</table>
      </center>
    </div>
<i>
<blockquote>
  <blockquote>
<p><font size="1">See notes to the pro forma condensed consolidated financial statements.</font></p>
  </blockquote>
</blockquote>
<font SIZE="1">
<p>&nbsp;</p>
</font></i><font SIZE="3">
<p ALIGN="JUSTIFY">&nbsp;</p>
</font><b>
<p ALIGN="CENTER">TEXTRON INC.<br>
<a NAME="_Hlk528633917">Pro Forma Condensed Consolidated Statement of Operations</a>
(unaudited)<br>
For the Nine Months Ended September 29, 2001</b><br>
(Dollars in millions, except per share amounts)
</p>
    <div align="center">
      <center>
<table CELLSPACING="1" CELLPADDING="1" WIDTH="690">
  <tr>
    <td WIDTH="37%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1"><font size="1">&nbsp;</font></td>
    <td WIDTH="17%" VALIGN="TOP" COLSPAN="2" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
      <p ALIGN="CENTER"><font size="1"><br>
      <br>
      Textron Inc.</font></td>
    <td WIDTH="14%" VALIGN="TOP" COLSPAN="2" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
      <p><font size="1"><br>
      Automotive Trim Business (<a href="#notea">A</a>)</font></td>
    <td WIDTH="16%" VALIGN="TOP" COLSPAN="2" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
      <p ALIGN="CENTER"><font size="1"><br>
      Pro Forma Adjustments</font></td>
    <td WIDTH="16%" VALIGN="TOP" COLSPAN="2" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
      <p ALIGN="CENTER"><font size="1"><br>
      <br>
      Adjusted Pro Forma</font></td>
    <td WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="37%" VALIGN="TOP"><b>
      <p><font size="1">Revenues</font></b></td>
    <td WIDTH="3%" VALIGN="TOP"><font size="1">&nbsp;</font></td>
    <td WIDTH="14%" VALIGN="TOP"><font size="1">&nbsp;</font></td>
    <td WIDTH="3%" VALIGN="TOP"><font size="1">&nbsp;</font></td>
    <td WIDTH="11%" VALIGN="TOP"><font size="1">&nbsp;</font></td>
    <td WIDTH="3%" VALIGN="TOP"><font size="1">&nbsp;</font></td>
    <td WIDTH="13%" VALIGN="TOP"><font size="1">&nbsp;</font></td>
    <td WIDTH="1%" VALIGN="TOP"><font size="1">&nbsp;</font></td>
    <td WIDTH="14%" VALIGN="TOP"><font size="1">&nbsp;</font></td>
    <td WIDTH="2%" VALIGN="TOP"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="37%" VALIGN="TOP">
      <p><font size="1">Manufacturing revenues</font></td>
    <td WIDTH="3%" VALIGN="TOP" align="right">
      <p ALIGN="RIGHT"><font size="1">$</font></td>
    <td WIDTH="14%" VALIGN="TOP" align="right">
      <p style="margin-right: 20"><font size="1">8,625</font></td>
    <td WIDTH="3%" VALIGN="TOP" align="right">
      <p ALIGN="RIGHT"><font size="1">$</font></td>
    <td WIDTH="11%" VALIGN="TOP" align="right">
      <p style="margin-right: 20"><font size="1">(1,200)</font></td>
    <td WIDTH="3%" VALIGN="TOP" align="right">
      <p><font size="1">$</font></td>
    <td WIDTH="13%" VALIGN="TOP" align="right">
    </td>
    <td WIDTH="1%" VALIGN="TOP" align="right">
      <p ALIGN="RIGHT"><font size="1">$</font></td>
    <td WIDTH="14%" VALIGN="TOP" align="right">
      <p style="margin-right: 20"><font size="1">7,425</font></td>
    <td WIDTH="2%" VALIGN="TOP"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="37%" VALIGN="TOP">
      <p><font size="1">Finance revenues</font></td>
    <td WIDTH="3%" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="14%" VALIGN="TOP" align="right">
      <p style="margin-right: 20"><font size="1">513</font></td>
    <td WIDTH="3%" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="11%" VALIGN="TOP" align="right">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
    </td>
    <td WIDTH="3%" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="13%" VALIGN="TOP" align="right">
      <p><font size="1">6 (<a href="#notei">I</a>)&nbsp;&nbsp;&nbsp; &nbsp;&nbsp;&nbsp;</font></td>
    <td WIDTH="1%" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="14%" VALIGN="TOP" align="right">
      <p style="margin-right: 20"><font size="1">519</font></td>
    <td WIDTH="2%" VALIGN="TOP"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="37%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
      <p><font size="1">&#160;&#160;&#160;&#160;&#160;Total revenues</font></td>
    <td WIDTH="3%" VALIGN="TOP" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1"><font size="1">&nbsp;</font></td>
    <td WIDTH="14%" VALIGN="TOP" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
      <p style="margin-right: 20"><font size="1">9,138</font></td>
    <td WIDTH="3%" VALIGN="TOP" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1"><font size="1">&nbsp;</font></td>
    <td WIDTH="11%" VALIGN="TOP" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
      <p style="margin-right: 20"><font size="1">(1,200)</font></td>
    <td WIDTH="3%" VALIGN="TOP" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1"><font size="1">&nbsp;</font></td>
    <td WIDTH="13%" VALIGN="TOP" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
      <p><font size="1">6&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
    <td WIDTH="1%" VALIGN="TOP" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1"><font size="1">&nbsp;</font></td>
    <td WIDTH="14%" VALIGN="TOP" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
      <p style="margin-right: 20"><font size="1">7,944</font></td>
    <td WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="37%" VALIGN="TOP"><b>
      <p><font size="1">Costs and expenses</font></b></td>
    <td WIDTH="3%" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="14%" VALIGN="TOP" align="right">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
    </td>
    <td WIDTH="3%" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="11%" VALIGN="TOP" align="right">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
    </td>
    <td WIDTH="3%" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="13%" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="1%" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="14%" VALIGN="TOP" align="right">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
    </td>
    <td WIDTH="2%" VALIGN="TOP"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="37%" VALIGN="TOP">
      <p><font size="1">Cost of sales</font></td>
    <td WIDTH="3%" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="14%" VALIGN="TOP" align="right">
      <p style="margin-right: 20"><font size="1">7,262</font></td>
    <td WIDTH="3%" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="11%" VALIGN="TOP" align="right">
      <p style="margin-right: 20"><font size="1">(1,077)</font></td>
    <td WIDTH="3%" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="13%" VALIGN="TOP" align="right">
      <p><font size="1">10&nbsp;(<a href="#notej">J</a>)&nbsp;&nbsp;&nbsp;&nbsp;
      &nbsp;&nbsp;</font></td>
    <td WIDTH="1%" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="14%" VALIGN="TOP" align="right">
      <p style="margin-right: 20"><font size="1">6,195</font></td>
    <td WIDTH="2%" VALIGN="TOP"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="37%" VALIGN="TOP">
      <p><font size="1">Selling and administrative</font></td>
    <td WIDTH="3%" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="14%" VALIGN="TOP" align="right">
      <p style="margin-right: 20"><font size="1">1,124</font></td>
    <td WIDTH="3%" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="11%" VALIGN="TOP" align="right">
      <p style="margin-right: 20"><font size="1">(57)</font></td>
    <td WIDTH="3%" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="13%" VALIGN="TOP" align="right">
      <p><font size="1">(9)&nbsp;(<a href="#notej">J</a>)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
    <td WIDTH="1%" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="14%" VALIGN="TOP" align="right">
      <p style="margin-right: 20"><font size="1">1,058</font></td>
    <td WIDTH="2%" VALIGN="TOP"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="37%" VALIGN="TOP">
      <p><font size="1">Interest, net</font></td>
    <td WIDTH="3%" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="14%" VALIGN="TOP" align="right">
      <p style="margin-right: 20"><font size="1">340</font></td>
    <td WIDTH="3%" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="11%" VALIGN="TOP" align="right">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
    </td>
    <td WIDTH="3%" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="13%" VALIGN="TOP" align="right">
      <p><font size="1">(18)&nbsp; (<a href="#notek">K</a>)&nbsp; &nbsp;</font></td>
    <td WIDTH="1%" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="14%" VALIGN="TOP" align="right">
      <p style="margin-right: 20"><font size="1">322</font></td>
    <td WIDTH="2%" VALIGN="TOP"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="37%" VALIGN="TOP">
      <p><font size="1">Special charges, net</font></td>
    <td WIDTH="3%" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="14%" VALIGN="TOP" align="right">
      <p style="margin-right: 20"><font size="1">415</font></td>
    <td WIDTH="3%" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="11%" VALIGN="TOP" align="right">
      <p style="margin-right: 20"><font size="1">(9)</font></td>
    <td WIDTH="3%" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="13%" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="1%" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="14%" VALIGN="TOP" align="right">
      <p style="margin-right: 20"><font size="1">406</font></td>
    <td WIDTH="2%" VALIGN="TOP"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="37%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
      <p><font size="1">&#160;&#160;&#160;&#160;&#160;Total costs and
      expenses</font></td>
    <td WIDTH="3%" VALIGN="TOP" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1"><font size="1">&nbsp;</font></td>
    <td WIDTH="14%" VALIGN="TOP" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
      <p style="margin-right: 20"><font size="1">9,141</font></td>
    <td WIDTH="3%" VALIGN="TOP" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1"><font size="1">&nbsp;</font></td>
    <td WIDTH="11%" VALIGN="TOP" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
      <p style="margin-right: 20"><font size="1">(1,143)</font></td>
    <td WIDTH="3%" VALIGN="TOP" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1"><font size="1">&nbsp;</font></td>
    <td WIDTH="13%" VALIGN="TOP" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
      <p><font size="1">(17)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
    <td WIDTH="1%" VALIGN="TOP" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1"><font size="1">&nbsp;</font></td>
    <td WIDTH="14%" VALIGN="TOP" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
      <p style="margin-right: 20"><font size="1">7,981</font></td>
    <td WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="37%" VALIGN="TOP">
      <p><font size="1">Loss from continuing operations before income<br>
      &nbsp;&nbsp;&nbsp;&nbsp; taxes&#160;and distributions on
      preferred securities of<br>
      &#160;&#160;&#160;&#160;&#160;subsidiary trusts</font></td>
    <td WIDTH="3%" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="14%" VALIGN="TOP" align="right">
      <p style="margin-right: 20"><font size="1"><br>
      <br>
      (3)</font></td>
    <td WIDTH="3%" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="11%" VALIGN="TOP" align="right">
      <p style="margin-right: 20"><font size="1"><br>
      <br>
      (57)</font></td>
    <td WIDTH="3%" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="13%" VALIGN="TOP" align="right">
      <p><font size="1"><br>
      <br>
      23&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
    <td WIDTH="1%" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="14%" VALIGN="TOP" align="right">
      <p style="margin-right: 20"><font size="1"><br>
      <br>
      (37)</font></td>
    <td WIDTH="2%" VALIGN="TOP"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="37%" VALIGN="TOP">
      <p><font size="1">Provision for income taxes</font></td>
    <td WIDTH="3%" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="14%" VALIGN="TOP" align="right">
      <p style="margin-right: 20"><font size="1">(69)</font></td>
    <td WIDTH="3%" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="11%" VALIGN="TOP" align="right">
      <p style="margin-right: 20"><font size="1">21</font></td>
    <td WIDTH="3%" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="13%" VALIGN="TOP" align="right">
      <p><font size="1">(8) (<a href="#notel">L</a>)&nbsp;&nbsp;&nbsp;</font></td>
    <td WIDTH="1%" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="14%" VALIGN="TOP" align="right">
      <p style="margin-right: 20"><font size="1">(56)</font></td>
    <td WIDTH="2%" VALIGN="TOP"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="37%" VALIGN="TOP">
      <p><font size="1">Distribution on preferred securities of<br>
      &#160;&#160;&#160;&#160;&#160;subsidiary trusts, net
      of income taxes</font></td>
    <td WIDTH="3%" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="14%" VALIGN="TOP" align="right">
      <p style="margin-right: 20"><font size="1"><br>
      (19)</font></td>
    <td WIDTH="3%" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="11%" VALIGN="TOP" align="right">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
    </td>
    <td WIDTH="3%" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="13%" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="1%" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="14%" VALIGN="TOP" align="right">
      <p style="margin-right: 20"><font size="1"><br>
      (19)</font></td>
    <td WIDTH="2%" VALIGN="TOP"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="37%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid">
      <p><font size="1">Net loss</font></td>
    <td WIDTH="3%" VALIGN="TOP" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid">
      <p ALIGN="RIGHT"><font size="1">$</font></td>
    <td WIDTH="14%" VALIGN="TOP" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid">
      <p style="margin-right: 20"><font size="1">(91)</font></td>
    <td WIDTH="3%" VALIGN="TOP" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid">
      <p ALIGN="RIGHT"><font size="1">$</font></td>
    <td WIDTH="11%" VALIGN="TOP" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid">
      <p style="margin-right: 20"><font size="1">(36)</font></td>
    <td WIDTH="3%" VALIGN="TOP" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid">
      <p><font size="1">$</font></td>
    <td WIDTH="13%" VALIGN="TOP" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid">
      <p style="margin-right: 20"><font size="1">15&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
    <td WIDTH="1%" VALIGN="TOP" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid"><font size="1">&nbsp;</font></td>
    <td WIDTH="14%" VALIGN="TOP" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid">
      <p style="margin-right: 20"><font size="1">(112)</font></td>
    <td WIDTH="2%" VALIGN="TOP" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="37%" VALIGN="TOP">
      <p><font size="1">Net loss per common share:</font></td>
    <td WIDTH="3%" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="14%" VALIGN="TOP" align="right">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
    </td>
    <td WIDTH="3%" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="11%" VALIGN="TOP" align="right">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
    </td>
    <td WIDTH="3%" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="13%" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="1%" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="14%" VALIGN="TOP" align="right">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
    </td>
    <td WIDTH="2%" VALIGN="TOP"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="37%" VALIGN="TOP" style="border-bottom-style: solid">
      <p><font size="1">&#160;&#160;&#160;&#160;&#160;Basic and diluted</font></td>
    <td WIDTH="3%" VALIGN="TOP" align="right" style="border-bottom-style: solid">
      <p ALIGN="RIGHT"><font size="1">$</font></td>
    <td WIDTH="14%" VALIGN="TOP" align="right" style="border-bottom-style: solid">
      <p style="margin-right: 20"><font size="1">(.65)</font></td>
    <td WIDTH="3%" VALIGN="TOP" align="right" style="border-bottom-style: solid">
      <p ALIGN="RIGHT"><font size="1">$</font></td>
    <td WIDTH="11%" VALIGN="TOP" align="right" style="border-bottom-style: solid">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
    </td>
    <td WIDTH="3%" VALIGN="TOP" align="right" style="border-bottom-style: solid">
      <p><font size="1">$</font></td>
    <td WIDTH="13%" VALIGN="TOP" align="right" style="border-bottom-style: solid"><font size="1">&nbsp;</font></td>
    <td WIDTH="1%" VALIGN="TOP" align="right" style="border-bottom-style: solid">
      <p ALIGN="RIGHT"><font size="1">$</font></td>
    <td WIDTH="14%" VALIGN="TOP" align="right" style="border-bottom-style: solid">
      <p style="margin-right: 20"><font size="1">(.81)</font></td>
    <td WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="37%" VALIGN="TOP">
      <p><font size="1">Average shares outstanding:</font></td>
    <td WIDTH="3%" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="14%" VALIGN="TOP" align="right">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
    </td>
    <td WIDTH="3%" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="11%" VALIGN="TOP" align="right">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
    </td>
    <td WIDTH="3%" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="13%" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="1%" VALIGN="TOP" align="right"><font size="1">&nbsp;</font></td>
    <td WIDTH="14%" VALIGN="TOP" align="right">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
    </td>
    <td WIDTH="2%" VALIGN="TOP"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="37%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1">
      <p><font size="1">&#160;&#160;&#160;&#160;&#160;Basic and diluted</font></td>
    <td WIDTH="3%" VALIGN="TOP" align="right" style="border-bottom-style: solid; border-bottom-width: 1"><font size="1">&nbsp;</font></td>
    <td WIDTH="14%" VALIGN="TOP" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
      <p style="margin-right: 20"><font size="1">140,985,000</font></td>
    <td WIDTH="3%" VALIGN="TOP" align="right" style="border-bottom-style: solid; border-bottom-width: 1"><font size="1">&nbsp;</font></td>
    <td WIDTH="11%" VALIGN="TOP" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
      <p style="margin-right: 20"><font size="1">&nbsp;</font></p>
    </td>
    <td WIDTH="3%" VALIGN="TOP" align="right" style="border-bottom-style: solid; border-bottom-width: 1"><font size="1">&nbsp;</font></td>
    <td WIDTH="13%" VALIGN="TOP" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
      <p><font size="1">(2,281,000) (<a href="#notem">M</a>)</font></td>
    <td WIDTH="1%" VALIGN="TOP" align="right" style="border-bottom-style: solid; border-bottom-width: 1"><font size="1">&nbsp;</font></td>
    <td WIDTH="14%" VALIGN="TOP" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
      <p style="margin-right: 20"><font size="1">138,704,000</font></td>
    <td WIDTH="2%" VALIGN="TOP" style="border-bottom-style: solid; border-bottom-width: 1"><font size="1">&nbsp;</font></td>
  </tr>
</table>
      </center>
    </div>
<font SIZE="1">
<i>
<blockquote>
  <blockquote>
    <blockquote>
<p>See notes to the pro forma condensed consolidated financial statements.</p>
    </blockquote>
  </blockquote>
</blockquote>
</i></font>
<p ALIGN="CENTER">&nbsp;</p>
<b>
<p ALIGN="CENTER">TEXTRON INC.<br>
Notes to the Pro Forma Condensed Consolidated Financial Statements<br>
(unaudited)</p>
</b>
<p ALIGN="CENTER">&nbsp;</p>
<b>
<p>Note 1 &#160;&#160;&#160;&#160;&#160;Pro Forma
Adjustments</p>
<blockquote>
  <blockquote>
  </b>
  <p><a NAME="_Hlk534696116"></a><a NAME="notea">A</a>.&#160;&#160;&#160;&#160;&#160;To
  eliminate the carrying value of the assets and liabilities and the operating
  results of the Automotive Trim business.</p>
  <p><a NAME="_Hlk534696331"></a><a NAME="_Hlk534697533"></a><a NAME="noteb">B</a>.&#160;&#160;&#160;&#160;&#160;To
  record cash proceeds from the sale including financing by TFC (see <a href="#noted">D</a>
  below), net of cash used to repurchase debt.</p>
  <p><a NAME="_Hlk534696370"></a><a NAME="notec">C</a>.&#160;&#160;&#160;&#160;&#160;To
  record (1) an investment of $237 million for the receipt of preferred shares
  of C&A Products valued at fair value ($147 million) and 18 million shares
  of C&A Corporation common stock valued at a cost of $5 per share ($90
  million); (2) an investment of $15 million for the 50% retained interest in
  Textron Automotive Holdings Italy S.r.l.; and (3) a $26 million deferred tax
  asset.</p>
  <p><a NAME="_Hlk534696405"></a><a NAME="noted">D</a>.&#160;&#160;&#160;&#160;&#160;To
  record $77 million in debt financing by Textron Finance which was utilized to
  acquire equipment from the Automotive Trim business. This equipment was then
  leased back to the Automotive Trim business resulting in an $87 million finance receivable.</p>
  <p><a NAME="_Hlk534696430"></a><a NAME="notee">E</a>.&#160;&#160;&#160;&#160;&#160;To
  record the use of proceeds to pay down outstanding debt.</p>
  <p><a NAME="_Hlk534696459"></a><a NAME="notef">F</a>.&#160;&#160;&#160;&#160;&#160;To
  record accrual for $56 million in transaction costs and $140 million in taxes.</p>
  <p><a NAME="_Hlk534696485"></a><a NAME="noteg">G</a>.&#160;&#160;&#160;&#160;&#160;To
  record obligations retained by Textron Inc.</p>
  <p><a NAME="_Hlk534696694"></a><a NAME="noteh">H</a>.&#160;&#160;&#160;&#160;&#160;To
  record the after&#45;tax gain on the sale and eliminate the $8 million
  cumulative translation adjustment for Textron&#39;s investment in the net
  assets sold.</p>
  <p><a name="notei">I</a>.&#160;&#160;&#160;&#160;&#160;To
  record financing income for the equipment lease.</p>
  <p><a name="notej">J</a>.&#160;&#160;&#160;&#160;&#160;To record other income
  and expenses related to retained operations and assets.</p>
  <p><a name="notek">K</a>.&#160;&#160;&#160;&#160;&#160;To
  record a reduction in interest expense of $22 million for the nine months
  ended September 29, 2001 and $29 million for the year ended December 30, 2000
  due to a $453 million reduction in outstanding debt at an average interest
  rate of 6.5%. This reduction is offset by additional interest expense of $4 million
  for the nine months ended September 29, 2001 and $5 million for the year ended
  December 30, 2000 on the $77 million in debt at Textron Finance.</p>
  <p><a name="notel">L</a>.&#160;&#160;&#160;&#160;&#160;To
  record the income tax impact for the adjustments in footnote (I) through (K).</p>
  <p><a name="notem">M</a>.&#160;&#160;&#160;&#160;&#160;To
  record the use of proceeds to buy back approximately four million shares of
  the Company&#39;s common stock pro rata over the first nine months of the
  respective periods using the average monthly historical stock price.</p>
  <p>&nbsp;</p>
  <p>&nbsp;</p>
</blockquote>
</blockquote>
<table CELLSPACING="0" CELLPADDING="1" WIDTH="819">
  <tr>
    <td WIDTH="42" VALIGN="TOP"><b>
      <p ALIGN="JUSTIFY">(c)</b></td>
    <td WIDTH="93" VALIGN="TOP"><b><u>
      <p ALIGN="CENTER">Exhibit No.</u></b></td>
    <td WIDTH="672" VALIGN="TOP"><b><u>
      <p ALIGN="CENTER">Exhibit</u></b></td>
  </tr>
  <tr>
    <td WIDTH="42" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="93" VALIGN="TOP">
      <p ALIGN="CENTER">2.1</td>
    <td WIDTH="672" VALIGN="TOP">
      <p>Purchase Agreement dated as of August 7, 2001, as amended and restated
      as of November&#160;30, 2001, by and among Textron Inc., Collins &
      Aikman Corporation and Collins & Aikman Products Co., including
      Exhibit 1 (Certificate of Designation of the Series A Redeemable Preferred
      Stock, the Series B Redeemable Preferred Stock and the Series C Redeemable
      Preferred Stock) and Exhibit 7 (Asset Purchase Agreement dated as of
      August 7, 2001, as amended and restated November&#160;30, 2001, by and
      between Textron Automotive Exteriors Inc. and JPS Automotive, Inc.).</td>
  </tr>
</table>
<p>NOTE: The Table of Contents of the Purchase Agreement listed as Exhibit 2.1
contains a list briefly identifying the contents of all omitted schedules and
exhibits. Textron will supplementally furnish a copy of any omitted schedule or
exhibit to the Commission upon request.</p>
<p>&nbsp;</p>
<p ALIGN="CENTER">SIGNATURES</p>
<p>Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.</p>
<table CELLSPACING="1" CELLPADDING="1" WIDTH="823">
  <tr>
    <td WIDTH="372" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="398" VALIGN="TOP">
      <p>TEXTRON INC.<br>
      (Registrant)</td>
    <td WIDTH="33" VALIGN="TOP">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="372" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="398" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="33" VALIGN="TOP">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="372" VALIGN="TOP"><u>
      <p>Date: January 4, 2002</u></td>
    <td WIDTH="398" VALIGN="TOP">
      <p style="border-bottom-style: solid; border-bottom-width: 1">/s/ R. L. Yates</td>
    <td WIDTH="33" VALIGN="TOP">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="372" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="398" VALIGN="TOP">
      <p>Name:&#160;&#160;&#160;R. L. Yates<br>
      Title:&#160;&#160;&#160;&#160;&#160;Vice President and
      Controller<br>
      &#160;&#160;&#160;&#160;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; &#160;(principal accounting
      officer)</td>
    <td WIDTH="33" VALIGN="TOP">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="372" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="398" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="33" VALIGN="TOP">&nbsp;</td>
  </tr>
</table>
<p>&nbsp;</p>
<p>&nbsp;</p>
<p ALIGN="CENTER">&nbsp;</p>
<p ALIGN="CENTER">INDEX TO EXHIBITS</p>
<table CELLSPACING="0" CELLPADDING="1" WIDTH="818">
  <tr>
    <td WIDTH="93" VALIGN="TOP"><u>
      <p ALIGN="CENTER">Exhibit No.</u></td>
    <td WIDTH="717" VALIGN="TOP"><u>
      <p ALIGN="CENTER">Exhibit</u></td>
  </tr>
  <tr>
    <td WIDTH="93" VALIGN="TOP">
      <p align="center">2.1</td>
    <td WIDTH="717" VALIGN="TOP">
      <p>Purchase Agreement dated as of August 7, 2001, as amended and restated
      as of November&#160;30, 2001, by and among Textron Inc., Collins &
      Aikman Corporation and Collins & Aikman Products Co., including
      Exhibit 1 (Certificate of Designation of the Series A Redeemable Preferred
      Stock, the Series B Redeemable Preferred Stock and the Series C Redeemable
      Preferred Stock) and Exhibit 7 (Asset Purchase Agreement dated as of
      August 7, 2001, as amended and restated November&#160;30, 2001, by and
      between Textron Automotive Exteriors Inc. and JPS Automotive, Inc.).</td>
  </tr>
</table>
<p>NOTE: The Table of Contents of the Purchase Agreements listed in Exhibit 2.1
contains a list briefly identifying the contents of all omitted schedules and
exhibits. Textron will supplementally furnish a copy of any omitted schedule or
exhibit to the Commission upon request</p>

</body>

</html>

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-2.1
<SEQUENCE>3
<FILENAME>two-one.htm
<DESCRIPTION>PURCHASE AGREEMENT
<TEXT>
<html>

<head>
<title>Exhibit 2</title>
</head>

<body>

<b>
<p ALIGN="RIGHT">Exhibit 2.1</p>
<p ALIGN="RIGHT">&nbsp;</p>
<p ALIGN="RIGHT">EXECUTION COPY</p>
<u>
</u>
<p ALIGN="CENTER">&nbsp;</p>
<p ALIGN="CENTER">&nbsp;</p>
<p ALIGN="CENTER">PURCHASE AGREEMENT</p>
<p ALIGN="CENTER">&nbsp;</p>
<p ALIGN="CENTER">by and among</p>
<p ALIGN="CENTER">&nbsp;</p>
<p ALIGN="CENTER">TEXTRON INC.</p>
<p ALIGN="CENTER">&nbsp;</p>
<p ALIGN="CENTER">COLLINS & AIKMAN CORPORATION</p>
<p ALIGN="CENTER">&nbsp;</p>
<p ALIGN="CENTER">and</p>
<p ALIGN="CENTER">&nbsp;</p>
<p ALIGN="CENTER">COLLINS & AIKMAN PRODUCTS CO.</p>
<p ALIGN="CENTER">&nbsp;</p>
<p ALIGN="CENTER">&nbsp;</p>
<p ALIGN="CENTER">August 7, 2001</p>
<p ALIGN="CENTER">&nbsp;</p>
<p ALIGN="CENTER">as amended and restated</p>
<p ALIGN="CENTER">&nbsp;</p>
<p ALIGN="CENTER">as of</p>
<p ALIGN="CENTER">&nbsp;</p>
<p ALIGN="CENTER">November 30, 2001</p>
</b><u>
<p>&nbsp;</p>
</u>
<p ALIGN="CENTER">TABLE OF CONTENTS</p>
<p ALIGN="CENTER">&nbsp;</p>
<p align="center">ARTICLE I
<p ALIGN="CENTER">DEFINITIONS; EFFECTIVENESS OF AMENDMENT</p>
<div align="center">
  <center>
<table CELLSPACING="0" CELLPADDING="1" WIDTH="600">
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>1.1</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Definitions.</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024457">1</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>1.2</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Effectiveness of Agreement</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024458">13</a></td>
  </tr>
</table>
  </center>
</div>
<p ALIGN="CENTER">&nbsp;</p>
<p ALIGN="CENTER">ARTICLE II</p>
<p ALIGN="CENTER">PURCHASE AND SALE OF SHARES</p>
<div align="center">
  <center>
<table CELLSPACING="1" CELLPADDING="1" WIDTH="600">
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>2.1</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Purchase and Sale of Shares</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024460">13</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>2.2</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Purchase and Sale of Assets</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024461">14</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>2.3</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Restructuring</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024462">15</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>2.4</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Purchase Price Adjustment</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024463">15</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>2.5</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Allocation of Consideration; Tax Filings.</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024464">17</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>2.6</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Closing</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024465">19</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>2.7</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Closing Obligations</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024466">20</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>2.8</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Earn&#45;Out</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024467">22</a></td>
  </tr>
</table>
  </center>
</div>
<p ALIGN="CENTER">&nbsp;</p>
<p ALIGN="CENTER">ARTICLE III</p>
<p ALIGN="CENTER">REPRESENTATIONS AND WARRANTIES OF PARENT</p>
<div align="center">
  <center>
<table CELLSPACING="1" CELLPADDING="1" WIDTH="600">
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>3.1</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Corporate Organization, Qualification, Power and Authority.</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024469">25</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>3.2</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Stock of Subsidiaries</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024470">26</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>3.3</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Consents and Approvals; No Violations</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024471">26</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>3.4</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Financial Statements</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024472">27</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>3.5</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Absence of Certain Changes or Events</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024473">28</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>3.6</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>No Undisclosed Liabilities</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024474">29</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>3.7</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Litigation</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024475">30</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>3.8</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Taxes</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024476">30</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>3.9</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Employee Benefit Plans and Agreements</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024477">30</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>3.10</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Labor Matters</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024478">33</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>3.11</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Environmental Laws and Regulations</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024479">34</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>3.12</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Compliance with Laws</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024480">34</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>3.13</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Properties</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024481">34</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>3.14</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Material Contracts</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024482">35</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>3.15</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Intellectual Property</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024483">35</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>3.16</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Product Warranties; Recalls</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024484">36</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>3.17</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Brokers and Finders</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024485">37</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>3.18</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Customers and Suppliers</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024486">37</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>3.19</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Additional Representations and Warranties by Parent</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024487">37</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>3.20</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Indebtedness</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024488">38</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>3.21</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>R&D People.</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024489">38</a></td>
  </tr>
</table>
  </center>
</div>
<p ALIGN="CENTER">&nbsp;</p>
<p ALIGN="CENTER">ARTICLE IV</p>
<p ALIGN="CENTER">REPRESENTATIONS AND WARRANTIES OF HOLDINGS AND C&A
PRODUCTS</p>
<div align="center">
  <center>
<table CELLSPACING="1" CELLPADDING="1" WIDTH="600">
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>4.1</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Corporate Organization, Qualification, Power and Authority.</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024491">39</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>4.2</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Capitalization of Holdings and C&A Products</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024492">41</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>4.3</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Stock of Subsidiaries</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024493">42</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>4.4</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Valid Issuance of Stock</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024494">43</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>4.5</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Consents and Approvals; No Violations</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024495">43</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>4.6</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>SEC Filings; Financial Statements</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024496">43</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>4.7</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Absence of Certain Changes or Events</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024497">44</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>4.8</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>No Undisclosed Liabilities</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024498">44</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>4.9</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Litigation</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024499">44</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>4.10</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Financing</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024500">45</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>4.11</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Certain Agreements</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024501">45</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>4.12</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Brokers and Finders</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024502">45</a></td>
  </tr>
</table>
  </center>
</div>
<p ALIGN="CENTER">&nbsp;</p>
<p ALIGN="CENTER">ARTICLE V</p>
<p ALIGN="CENTER">COVENANTS RELATING TO CONDUCT OF BUSINESS AND OTHER AGREEMENTS</p>
<div align="center">
  <center>
<table CELLSPACING="1" CELLPADDING="1" WIDTH="600">
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>5.1</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Conduct of the Business</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024504">46</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>5.2</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Access to Information</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024505">49</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>5.3</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Competition Filings</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024506">49</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>5.4</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Consents and Reasonable Efforts</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024507">50</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>5.5</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Further Assurances</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024508">51</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>5.6</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Publicity.</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024509">52</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>5.7</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Employee Matters.</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024510">53</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>5.8</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Tax Matters</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024511">60</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>5.9</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Bison Financial Statements</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024512">70</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>5.10</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Observer Rights</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024513">71</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>5.11</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Non&#45;Competition</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024514">71</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>5.12</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Intercompany Transactions</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024515">72</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>5.13</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Additional Covenant of C&A and Holdings.</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024516">72</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>5.14</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Certain Pre&#45;Closing Restrictions</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024517">73</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>5.15</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Closing Date Indebtedness</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024518">73</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>5.16</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Tax Reporting</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024519">73</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>5.17</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>R&D Employees.</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024520">74</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>5.18</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>IRB</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024521">74</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>5.19</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>[Reserved.]</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024522">75</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>5.20</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Textron Automotive Holdings Italy</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024523">75</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>5.21</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Property Lease.</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024524">76</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>5.22</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Reduction in Workforce Charges.</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024525">77</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>5.23</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Board of Directors</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024526">78</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>5.24</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Financing Discussions</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024527">78</a></td>
  </tr>
</table>
  </center>
</div>
<p ALIGN="CENTER">&nbsp;</p>
<p ALIGN="CENTER">ARTICLE VI</p>
<p ALIGN="CENTER">CONDITIONS TO CONSUMMATION OF THE TRANSACTION</p>
<div align="center">
  <center>
<table CELLSPACING="1" CELLPADDING="1" WIDTH="600">
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>6.1</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Conditions to Each Party&#39;s Obligations to Complete the
      Transactions.</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024529">79</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>6.2</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Additional Conditions to the Obligation of Holdings and C&A
      Products</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024530">79</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>6.3</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Additional Conditions to the Obligation of Parent.</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024531">80</a></td>
  </tr>
</table>
  </center>
</div>
<p ALIGN="CENTER">&nbsp;</p>
<p ALIGN="CENTER">ARTICLE VII</p>
<p ALIGN="CENTER">TERMINATION</p>
<div align="center">
  <center>
<table CELLSPACING="1" CELLPADDING="1" WIDTH="600">
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>7.1</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Termination by Mutual Consent.</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024533">82</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>7.2</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Termination by Any Party.</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024534">82</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>7.3</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Termination by Parent</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024535">82</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>7.4</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Effect of Termination.</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024536">82</a></td>
  </tr>
</table>
  </center>
</div>
<p ALIGN="CENTER">&nbsp;</p>
<p ALIGN="CENTER">ARTICLE VIII</p>
<p ALIGN="CENTER">OBLIGATIONS AFTER CLOSING</p>
<div align="center">
  <center>
<table CELLSPACING="1" CELLPADDING="1" WIDTH="600">
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>8.1</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Survival of Representations, Warranties and Covenants; Indemnification.</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024538">83</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>8.2</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Environmental Indemnification</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024539">89</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>8.3</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Quota Purchase Agreement Indemnification</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024540">96</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>8.4</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Name Changes</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024541">96</a></td>
  </tr>
</table>
  </center>
</div>
<p ALIGN="CENTER">&nbsp;</p>
<p ALIGN="CENTER">ARTICLE IX</p>
<p ALIGN="CENTER">MISCELLANEOUS AND GENERAL</p>
<div align="center">
  <center>
<table CELLSPACING="1" CELLPADDING="1" WIDTH="600">
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>9.1</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Interpretation.</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024543">97</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>9.2</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Principle of Construction</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024544">97</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>9.3</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Payment of Expenses and Other Payments</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024545">97</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>9.4</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Amendment</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024546">98</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>9.5</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Waiver and Extension</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024547">98</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>9.6</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Counterparts</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024548">98</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>9.7</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Governing Law</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024549">98</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>9.8</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Notices</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024550">99</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>9.9</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Entire Agreement; Assignment.</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024551">100</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>9.10</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Parties in Interest</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024552">100</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>9.11</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Validity</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024553">100</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>9.12</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Captions</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024554">100</a></td>
  </tr>
  <tr>
    <td WIDTH="12%" VALIGN="TOP">
      <p>9.13</td>
    <td WIDTH="81%" VALIGN="TOP">
      <p>Transfer, Sales and Stamp Taxes</td>
    <td WIDTH="7%" VALIGN="TOP">
      <p><a HREF="#_Toc532024555">100</a></td>
  </tr>
</table>
  </center>
</div>
<p>&nbsp;</p>
<p style="margin-top: 0; margin-bottom: 0">
SCHEDULE A &#45; Directly Purchased Subsidiaries
<p style="margin-top: 0; margin-bottom: 0">SCHEDULE B &#45; Subsidiaries of the Directly Purchased Subsidiaries</p>
<p style="margin-top: 0; margin-bottom: 0">SCHEDULE C &#45; Restructuring</p>
<p style="margin-top: 0; margin-bottom: 0">SCHEDULE D &#45; Allocation of Purchase Price</p>
<p style="margin-top: 0; margin-bottom: 0">SCHEDULE E &#45; Subsidiaries of Holdings</p>
<p style="margin-top: 0; margin-bottom: 0">SCHEDULE F &#45; Acquiring Entities</p>
<p style="margin-top: 0; margin-bottom: 0">SCHEDULE G &#45; Earn&#45;Out</p>
<p style="margin-top: 0; margin-bottom: 0">SCHEDULE H &#45; First Quarter Restructuring Charges</p>
<p>EXHIBIT 1 &#45; Certificate of Designation</p>
<p style="margin-top: 0; margin-bottom: 0">EXHIBIT 2 &#45; Assignment and Assumption Agreement</p>
<p style="margin-top: 0; margin-bottom: 0">EXHIBIT 3A &#45; Intellimold License Agreement</p>
<p style="margin-top: 0; margin-bottom: 0">EXHIBIT 3B &#45; Retained IP &#45; License Agreement</p>
<p style="margin-top: 0; margin-bottom: 0">EXHIBIT 3C &#45; Licensed IP &#45; License Agreement</p>
<p style="margin-top: 0; margin-bottom: 0">EXHIBIT 4 &#45; Transition Agreement</p>
<p style="margin-top: 0; margin-bottom: 0">EXHIBIT 5 &#45; Preferred Stock Registration Rights Agreement</p>
<p style="margin-top: 0; margin-bottom: 0">EXHIBIT 6 &#45; Common Stock Registration Rights Agreement</p>
<p style="margin-top: 0; margin-bottom: 0">EXHIBIT 7 &#45; Asset Purchase Agreement</p>
<p style="margin-top: 0; margin-bottom: 0">EXHIBIT 8 &#45; Joint Venture and Shareholders Agreement</p>
<p style="margin-top: 0; margin-bottom: 0">EXHIBIT 9 &#45; Administrative Services Agreement</p>
<p style="margin-top: 0; margin-bottom: 0">EXHIBIT 10 &#45; License and Technical Assistance Agreement</p>
<p style="margin-top: 0; margin-bottom: 0">EXHIBIT 11 &#45; Engineering Services Agreement</p>
<p style="margin-top: 0; margin-bottom: 0">EXHIBIT 12 &#45; Equipment Lease Term Sheet</p>
<b>
<p ALIGN="CENTER">PURCHASE AGREEMENT</p>
</b>
<p>&nbsp;</p>
<p>PURCHASE AGREEMENT, dated as of August 7, 2001, as amended and restated as of
November 30, 2001 (the &quot;Agreement&quot;), by and between Textron Inc., a
Delaware corporation (&quot;Parent&quot;), Collins & Aikman Corporation, a
Delaware corporation (&quot;Holdings&quot;), and Collins & Aikman Products
Co., a Delaware corporation (&quot;C&A Products&quot;) and a wholly owned
subsidiary of Holdings.</p>
<p>WHEREAS, Parent desires to sell and C&A Products and certain of its
Subsidiaries desire to purchase the exterior and interior automotive trim
operations currently managed as a unit of Textron Automotive Company Inc.;</p>
<p>NOW, THEREFORE, in consideration of the mutual representations, warranties,
covenants and agreements set forth in this Agreement and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, Parent, Holdings and C&A Products, intending to be legally
bound, agree as follows:</p>
<p>&nbsp;</p>
<font COLOR="#ff0000">
<p ALIGN="CENTER">ARTICLE I<a NAME="_Toc503343057"></a><a NAME="_Toc503343302"></a></font><br>
<br>
<a NAME="_Toc503342956"></a><a NAME="_Toc503343906"></a><a NAME="_Toc503667888"></a><a NAME="_Toc503684819"></a><a NAME="_Toc504459510"></a><a NAME="_Toc505070773"></a><a NAME="_Toc505137369"></a><a NAME="_Toc505767615"></a><a NAME="_Toc506346185"></a><a NAME="_Toc506628502"></a><a NAME="_Toc506775312"></a><a NAME="_Toc507592178"></a><a NAME="_Toc508437251"></a><a NAME="_Toc508709199"></a><a NAME="_Toc514731985"></a><a NAME="_Toc514732723"></a><a NAME="_Toc516384233"></a><a NAME="_Toc516456555"></a><a NAME="_Toc516460915"></a><a NAME="_Toc516463331"></a><a NAME="_Toc516560516"></a><a NAME="_Toc518363211"></a><a NAME="_Toc518466791"></a><a NAME="_Toc518732994"></a><a NAME="_Toc518733438"></a><a NAME="_Toc519520808"></a><a NAME="_Toc519700982"></a><a NAME="_Toc520104829"></a><a NAME="_Toc520108683"></a><a NAME="_Toc520261491"></a><a NAME="_Toc520609420"></a><a NAME="_Toc521132917"></a><a NAME="_Toc521304939"></a><a NAME="_Toc521330716"></a><a NAME="_Toc521426428"></a><a NAME="_Toc521468827"></a><a NAME="_Toc52
1492877"></a><a NAME="_Toc529701212"></a><a NAME="_Toc529706150"></a><a NAME="_Toc529947339"></a><a NAME="_Toc530205059"></a><a NAME="_Toc530215665"></a><a NAME="_Toc530801223"></a><a NAME="_Toc531699817"></a><a NAME="_Toc531774205"></a><a NAME="_Toc531805619"></a><a NAME="_Toc532024456"></a><u>DEFINITIONS;
EFFECTIVENESS OF AMENDMENT</p>
</u>
<p ALIGN="CENTER">&nbsp;</p>
<u>
<p>&nbsp;</p>
</u><font COLOR="#ff0000">
<p>1.1 <a NAME="_Toc503342957"></a><a NAME="_Toc503343058"></a><a NAME="_Toc503343303"></a></font><a NAME="_Toc532024457"><u>Definitions</u>.</a>&nbsp;
For purposes of this Agreement, except as otherwise expressly provided or
unless the context clearly requires otherwise:</p>
<p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&quot;Actuary
Firm&quot; shall have the meaning ascribed to it in Section 5.7(c)(vii).</p>
<p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&quot;Adjustment
Schedule&quot; shall have the meaning ascribed to it in Section 2.5(a).</p>
<p>&quot;Affiliate&quot; of any Person shall mean any other Person that directly
or indirectly, through one or more intermediaries, controls, is controlled by,
or is under common control with, such first Person.</p>
<p>&quot;After&#45;Acquired Business&quot; shall have the meaning ascribed
to it in Section 5.11(b).</p>
<p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&quot;After
Tax Amount&quot; shall have the meaning ascribed to it in Section 5.8(g).</p>
<p>&quot;Agreement&quot; shall have the meaning ascribed to it in the preamble.</p>
<p>&quot;Allocation Dispute Notice&quot; shall have the meaning ascribed to it
in Section 2.5(b).</p>
<p>&quot;Antitrust Division&quot; shall have the meaning ascribed to it in
Section 5.3(a).</p>
<p>&quot;Balance Sheet Indebtedness&quot; shall mean Indebtedness of the type
referenced in clauses (a), (b) and (c) of the definition thereof (excluding any
Indebtedness related to the financing transactions specified in Section 5.21(a))
plus accrued interest on said Indebtedness in each case determined in accordance
with GAAP.</p>
<blockquote>
  <p>&quot;Bank&quot; shall have the meaning ascribed to it in
  Section&#160;4.10(a).</p>
</blockquote>
<p>&quot;Bison Plan&quot; shall have the meaning ascribed to it in Section
3.9(a).</p>
<p>&quot;Bison Properties&quot; shall mean all parcels of and interests in real
property owned in fee or leased by Parent or its Subsidiaries and used in the
Business as of the date hereof or the Closing Date.</p>
<p>&quot;Bison Subsidiaries&quot; shall have the meaning ascribed to it in
Section 2.3.</p>
<p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&quot;Brazilian
Entities&quot; shall have the meaning ascribed to it in Section 5.8(a)(i).</p>
<p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&quot;Business&quot;
shall mean the Textron exterior and interior automotive trim operations
currently managed as a unit of Textron Automotive Company Inc.</p>
<p>&quot;C&A Products&quot; shall have the meaning ascribed to it in the
preamble.</p>
<p>&quot;C&A Products&#39; Hourly Pension Plan&quot; shall have the
meaning ascribed to it in Section&#160;5.7(c)(iii).</p>
<p>&quot;C&A Products&#39; Salaried Pension Plan&quot; shall have the
meaning ascribed to it in Section&#160;5.7(c)(ii).</p>
<p>&quot;C&A Products&#39; Savings Plan&quot; shall have the meaning
ascribed to it in Section 5.7(d).</p>
<p>&quot;C&A Products&#39; Trustee&quot; shall have the meaning ascribed
to it in Section&#160;5.7(c)(iv).</p>
<p>&quot;Call Notice&quot; shall have the meaning ascribed to it in Section
5.20(d).</p>
<p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&quot;Certificate
of Designation&quot; shall have the meaning ascribed to it in Section 2.1(b).</p>
<p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&quot;Claim&quot;
shall have the meaning ascribed to it in Section 8.1(e).</p>
<p>&quot;Closing&quot; shall have the meaning ascribed to it in Section 2.6.</p>
<p>&quot;Closing Cash&quot; shall mean cash as shown on the Closing Financial
Statement; <u>provided</u>, <u>however</u>, that (i) cash of THI and its
Subsidiaries shall be excluded and (ii) with respect to Plascar Participacoes
Industriais S.A. and TATB, only 56.6% of the foregoing items shall constitute
Closing Cash. Closing Cash includes cash in any account in which cash has been
withheld or otherwise set aside for the benefit of an applicable Taxing
Authority to satisfy Taxes, provided that Holdings or C&A Products has
directly or indirectly received control over such account. (For avoidance of
doubt, outstanding checks and negative cash attributable to negative cash
balances will be taken into account when computing Closing Cash unless the item
is included in Balance Sheet Indebtedness or the computation of Working
Capital.)</p>
<p>&quot;Closing Date&quot; shall have the meaning ascribed to it in Section
2.6.</p>
<p>&quot;Closing Financial Statement&quot; shall have the meaning ascribed to it
in Section 2.4(a).</p>
<p>&quot;Code&quot; shall mean the Internal Revenue Code of 1986, as amended.</p>
<p>&quot;Commitment Letters&quot; shall have the meaning ascribed to it in
Section&#160;4.10(a).</p>
<p>&quot;Confidentiality Agreement&quot; shall mean the agreement dated as of
February 23, 2001 by and between Parent and Heartland Industrial Partners, L.P.</p>
<p>&quot;Consent&quot; shall mean any consent, approval, authorization,
clearance, exemption, waiver, or similar affirmation by, or filing with or
notification to, a Person pursuant to any Contract, Law, Order or Permit.</p>
<p>&quot;Contract&quot; shall mean any agreement, arrangement, commitment,
contract, indenture, instrument, lease or other obligation of any kind or
character that is binding on any Person or its capital stock, properties or
business.</p>
<p>&quot;Debt Commitment Letter&quot; shall have the meaning ascribed to it in
Section&#160;4.10(a).</p>
<p>&quot;December 30, 2000 Statement of Net Assets to be Sold&quot; shall have
the meaning ascribed to it in Section 3.4.</p>
<p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&quot;Default&quot;
shall mean (i) any breach or violation of or default under any Contract, Order
or Permit, (ii) any occurrence of any event that with the passage of time or the
giving of notice or both would constitute a breach or violation of or default
under any Contract, Order or Permit or (iii) any occurrence of any event that
with the passage of time or the giving of notice or both would give rise to any
right of termination, cancellation or acceleration under any Contract, Order or
Permit.</p>
<p>&nbsp;</p>
<p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&quot;Direct
Claim&quot; shall have the meaning ascribed to it in Section 8.1(e).</p>
<p>&quot;Directly Purchased Subsidiary&quot; shall mean the Subsidiaries of
Parent listed on Schedule A hereto.</p>
<p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&quot;Director
Termination Date&quot; means the date upon which Parent and its Affiliates cease
to continuously own from the date hereof through and including the date of
determination at least $25 million in Value of the Total Amount. &quot;Total
Amount&quot; means the sum of (1) the Value of the Holdings Common Stock issued
hereunder, (2) the Value of the Preferred Stock issued hereunder and (3) the
Value of the equity interests in THI retained by Parent and its Affiliates
hereunder. For the purposes of this definition, &quot;Value&quot; shall at all
times be determined by reference to the following assigned values, without
regard to subsequent changes in value or the agreements as to value set forth
herein: (1) $5.00 per share for the Holdings Common Stock; (2) $23.1 million for
the retained THI equity interests in aggregate; and (3) the initial liquidation
preference per share of a share of Preferred Stock.</p>
<p>&quot;Disclosure Schedule&quot; shall mean the Disclosure Schedule prepared
by Parent and delivered to Holdings and C&A Products concurrently with the
execution of this Agreement.</p>
<p>&quot;Dispute Notice&quot; shall have the meaning ascribed to it in Section
2.4(e).</p>
<p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&quot;E&Y&quot;
shall mean Ernst & Young LLP, independent accountants of Parent and the
Bison Subsidiaries.</p>
<p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&quot;Earn&#45;Out
Amount&quot; shall have the meaning ascribed to it in Section 2.8(a).</p>
<p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&quot;EBITDA&quot;
shall have the meaning ascribed to it in Section 2.8(a).</p>
<p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&quot;Employee
Agreement&quot; shall have the meaning ascribed to it in Section 5.7(f)(iii).</p>
<p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&quot;Employees&quot;
shall mean employees employed by a Bison Subsidiary on the Closing Date,
excluding employees of THI and its Subsidiaries.</p>
<p>&quot;Environmental Laws&quot; means the common law and all domestic and
foreign, federal, state and local Laws, relating to pollution or protection of
the environment, including employee health and safety and natural resource
damages, and including Laws relating to releases or threatened releases of
Hazardous Substances into the environment (including ambient air, indoor air,
surface water, groundwater, land, surface and subsurface strata).</p>
<p>&quot;Environmental Losses&quot; shall have the meaning ascribed to it in
Section 8.2(e).</p>
<p>&quot;Equity Commitment Letters&quot; shall have the meaning ascribed to it
in Section&#160;4.10(a).</p>
<p>&quot;Equity Consideration&quot; shall have the meaning ascribed to it in
Section&#160;3.19(a).</p>
<p>&quot;Equity Sources&quot; shall have the meaning ascribed to it in
Section&#160;4.10(a).</p>
<p>&quot;ERISA&quot; shall have the meaning ascribed to it in Section 3.9(a).</p>
<p>&quot;ERISA Affiliate&quot; shall have the meaning ascribed to it in Section
3.9(a).</p>
<p>&quot;FAS 87&quot; shall have the meaning ascribed to it in Section
5.7(c)(v).</p>
<p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&quot;Fair
Market Value&quot; shall have the meaning ascribed to it in Section 5.20(f).</p>
<p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&quot;Final
Allocation Schedule&quot; shall have the meaning ascribed to it in Section
2.5(c).</p>
<p>&quot;Financial Statements&quot; shall have the meaning ascribed to it in
Section 3.4.</p>
<p>&quot;Financing Agreements&quot; shall have the meaning ascribed to it in
Section&#160;5.5(b).</p>
<p>&quot;Foreign Competition Laws&quot; shall mean foreign statutes, ordinances,
rules, regulations, orders, decrees, administrative and judicial directives, and
other foreign laws, that are designed or intended to prohibit, restrict or
regulate actions having the purpose or effect of monopolization, lessening of
competition or restraint of trade or creating or strengthening a dominant
position.</p>
<p>&quot;Foreign Plan&quot; shall have the meaning ascribed to it in
Section&#160;3.9(l).</p>
<p>&quot;Former Employee&quot; shall mean any (a) person whose employment by a
Bison Subsidiary (other than THI and its Subsidiaries), or by Textron Automotive
Company Inc. if such person&#39;s entire salary was directly charged to the
Business, was terminated on or before the Closing Date (whether by retirement or
otherwise), excluding persons who were employed by Parent, a Non&#45;Bison
Subsidiary or any of their other Affiliates, as of the Closing Date and (b)
Employee who is on short&#45;term medical disability as of the Closing Date
and who thereafter becomes eligible for long&#45;term medical disability.</p>
<p>&quot;FTC&quot; shall have the meaning ascribed to it in Section 5.3(a).</p>
<p>&quot;GAAP&quot; shall mean United States generally accepted accounting
principles.</p>
<p>&quot;Governmental Authority&quot; shall mean any domestic or foreign agency,
authority, board, judicial body, commission, legislature, instrumentality or
office of any federal, state, county, district, municipal, city or other
government unit.</p>
<p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&quot;Guarantees&quot;
shall have the meaning ascribed to it in Section 5.4(b).</p>
<p>&quot;Hazardous Substances&quot; shall mean any chemical, material or
substance defined as or included in the definition of &quot;hazardous
substances&quot;, &quot;hazardous wastes&quot;, &quot;hazardous materials&quot;,
&quot;hazardous constituents&quot;, &quot;restricted hazardous materials&quot;,
&quot;extremely hazardous substances&quot;, &quot;toxic substances&quot;,
&quot;contaminants&quot;, &quot;pollutants&quot;, &quot;toxic pollutants&quot;,
or words of similar meaning and regulatory effect under any applicable
Environmental Law, including petroleum and asbestos.</p>
<p>&quot;Heartland&quot; means Heartland Industrial Partners, L.P. and its
Affiliates.</p>
<p>&quot;Holdings&quot; shall have the meaning ascribed to it in the preamble.</p>
<p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&quot;Holdings
Board&quot; shall have the meaning ascribed to it in Section 5.23(a).</p>
<p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&quot;Holdings
Common Stock&quot; shall have the meaning ascribed to it in Section 2.1(b).</p>
<p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&quot;Holdings
Indemnified Parties&quot; shall have the meaning ascribed to it in Section
8.1(b).</p>
<p>&quot;Holdings Material Adverse Effect&quot; shall mean any adverse change in
the business, properties, financial condition or results of operations of
Holdings or any of its Subsidiaries, which, individually or together with any
other such adverse change, is material to C&A and its Subsidiaries, taken as
a whole, other than any such effect attributable to or resulting from (i) the
public announcement of the transactions contemplated hereby or (ii) any adverse
change in general economic conditions or in conditions affecting the automotive
supplier industry generally.</p>
<p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&quot;Holdings
SEC Reports&quot; shall have the meaning ascribed to it in
Section&#160;4.7(a).</p>
<p>&quot;HSR Act&quot; shall have the meaning ascribed to it in Section 3.3(a).</p>
<p>&quot;Indemnified Party&quot; shall have the meaning ascribed to it in
Section 8.1(d)(iii).</p>
<p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&quot;Indemnifying
Party&quot; shall have the meaning ascribed to it in Section 8.1(d)(iii).</p>
<p>&quot;Indebtedness&quot; of any Person shall mean without duplication, (a)
all indebtedness of such Person for borrowed money or for the deferred purchase
price of property or services (other than current trade liabilities incurred in
the ordinary course of business), (b) any other indebtedness of such Person
which is evidenced by a note, bond, debenture or similar instrument, (c) all
capital lease obligations of such Person, (d) all obligations of such Person in
respect of bankers&#39; acceptances or letters of credit issued or created
for the account of such Person, (e) all obligations of others secured by (or for
which the holder of such obligation has an existing right, contingent or
otherwise, to be secured by) any Lien on any property owned or acquired by such
Person even though such Person has not assumed or otherwise become liable for
the payment thereof, (f) all obligations of such Person in respect of interest
rate and currency swap or hedge agreements and (g) all guarantees by such Person
of Indebtedness of others. The Indebtedness of any Person shall include the
Indebtedness of any partnership in which such Person is a general partner; <u>provided</u>
that, if the sole asset of such Person is its general partnership interest in
such partnership, the amount of such Indebtedness shall be deemed equal to the
value of such general partnership interest and the amount of any Indebtedness in
respect of any guarantee of such partnership Indebtedness shall be limited to
the same extent as such guarantee may be limited.</p>
<p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&quot;Independent
Accounting Firm&quot; shall have the meaning ascribed to it in Section 2.4(e).</p>
<p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;</p>
<p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&quot;Intellectual
Property&quot; means (a)&#160;all inventions and discoveries (whether
patentable or unpatentable and whether or not reduced to practice), all
improvements thereto, and all patents, patent applications and patent
disclosures, together with all re&#45;issuances, continuations,
continuations&#45;in&#45;part, revisions, extensions and reexaminations
thereof, (b)&#160;all trademarks and service marks, including all goodwill
associated therewith, and all applications, registrations and renewals in
connection therewith, (c)&#160;all copyrightable works, all copyrights and
all applications, registrations and renewals in connection therewith,
(d)&#160;all know&#45;how, trade secrets, technical information and
confidential business information (whether patentable or unpatentable and
whether or not reduced to practice), including, ideas, research and development,
formulas, compositions, manufacturing and production processes, techniques and
methods, technical data, designs, drawings, blue prints, patterns,
specifications, assembly procedures, test procedures, instruction manuals,
operation manuals, maintenance manuals, reliability data, quality control data,
customer and supplier lists, parts lists, pricing and cost information and
business and marketing plans and proposals, (e)&#160;all computer software
(excluding generally commercially available software licensed on standard terms)
used solely in the conduct of the Business (including data and related
documentation), (f)&#160;all other proprietary rights and (g)&#160;all
copies and tangible embodiments thereof (in whatever form or medium), in each
case necessary for the conduct of the Business as currently conducted.</p>
<p>&quot;Interest Rate&quot; shall mean 6.5% per year calculated on the basis of
a 365 day year and charged for the actual number of days elapsed.</p>
<p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&quot;Italian
JV Documents&quot; shall have the meaning ascribed to it in Section 5.20(b).</p>
<p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&quot;Italian
Opco&quot; shall have the meaning ascribed to it in Section 5.20(a).</p>
<p>&quot;Law&quot; shall mean any domestic or foreign federal, state or local
law, statute, ordinance, rule, regulation, and any other executive or
legislative proclamation.</p>
<p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&quot;Leasing
Documents&quot; shall have the meaning ascribed to it in Section 5.21(a).</p>
<p>&quot;Lien&quot; shall mean any mortgage, pledge, security interest,
attachment, encumbrance, lien or charge of any kind (including any agreement to
give any of the foregoing) or right of others of any similar nature; <u>provided</u>,
<u>however</u>, that the term &quot;Lien&quot; shall not include (i) statutory
liens for Taxes, which are not yet due and payable or are being contested in
good faith by appropriate proceedings, (ii) statutory or common law liens to
secure landlords, lessors or renters under leases or rental agreements confined
to the premises rented, (iii) deposits or pledges made in connection with, or to
secure payment of, worker&#39;s compensation, unemployment insurance, old
age pension or other social security programs mandated under applicable Laws,
(iv) statutory or common law liens in favor of carriers, warehousemen, mechanics
and materialmen to secure claims for labor, materials or supplies and other like
liens and (v) restrictions on transfer of securities imposed by applicable state
and federal securities Laws.</p>
<p>&quot;Litigation&quot; shall mean any suit, action, arbitration, cause of
action, claim, complaint, criminal prosecution, investigation, demand letter,
governmental or other administrative proceeding, whether at law or at equity,
before or by any domestic or foreign federal, state or local court, tribunal, or
agency or before any arbitrator.</p>
<p>&quot;Losses&quot; shall mean any and all actual losses, liabilities, costs
and expenses (including reasonable attorneys&#39; fees and costs of
investigation), after giving effect to any related Tax Benefit and Tax Detriment
and net of any reserves and amounts recovered from third parties, including
amounts recovered under insurance policies purchased by Parent or a Subsidiary
of Parent prior to the Closing Date, with respect to such Losses; <u>provided</u>,
that Losses shall not include any costs or expenses of any Indemnified Party
related to the time spent on any indemnified matter by employees or management
of the Indemnified Party.</p>
<p>&quot;Marelli Joint Venture Agreement&quot; shall have the meaning ascribed
to it in Section 5.20(b).</p>
<p>&quot;Material Adverse Effect&quot; shall mean any adverse change in the
business, properties, financial condition or results of operations of any of the
Bison Subsidiaries (after giving effect to the Restructuring), which,
individually or together with any other such adverse change, is material to the
Business, taken as a whole, other than any such effect attributable to or
resulting from (i) the public announcement of the transactions contemplated
hereby, (ii) any act or omission of Parent or any Bison Subsidiary taken with
the prior written consent of Holdings, (iii) actions taken by Parent or any
Bison Subsidiary at the specific written request of Holdings or (iv) any adverse
change in general economic conditions or in conditions affecting the tier one
automotive supplier industry generally.</p>
<p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&quot;Material
Breach&quot; shall have the meaning ascribed to it in Section 2.8(e).</p>
<p>&quot;Material Contract&quot; shall have the meaning ascribed to it in
Section 3.14(b).</p>
<p>&quot;Non&#45;Bison Subsidiary&quot; shall have the meaning ascribed to
it in Section 2.4(g).</p>
<p>&quot;Off&#45;Site Location&quot; shall have the meaning ascribed to it
in Section 8.2(e).</p>
<p>&quot;Order&quot; shall mean any decision or award, decree, injunction,
judgment, order, quasi&#45;judicial decision or award, ruling, or writ of
any domestic or foreign federal, state or local or other court, arbitrator (with
binding effect), tribunal, administrative agency or authority.</p>
<p>&#160;&#160;&#160;&#160;&#160;&quot;Ownership
Percentage&quot; shall have the meaning ascribed to it in Section 5.8(c)(iii).</p>
<p>&quot;Parent&quot; shall have the meaning ascribed to it in the preamble.</p>
<p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&quot;Parent
Entity&quot; shall mean (i) Parent and its Subsidiaries (other than the Bison
Subsidiaries), so long as such subsidiary remains an Affiliate of Parent, and
(ii) any Person who directly or indirectly acquires more than 50% of the voting
control of Parent as a result of a nonacquisitive reorganization such as a
merger pursuant to Section 251(g) of the Delaware General Corporation Law and
any Subsidiaries of such Person.</p>
<p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&quot;Parent
Indemnified Parties&quot; shall have the meaning ascribed to it in Section
8.1(c).</p>
<p>&quot;Parent Names&quot; shall have the meaning ascribed to it in Section
8.4.</p>
<p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&quot;Parent&#39;s
Hourly Master Pension Benefit&quot; shall have the meaning ascribed to it in
Section 5.7(c)(iii).</p>
<p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&quot;Parent&#39;s
Salaried Pension Benefit&quot; shall have the meaning ascribed to it in Section
5.7(c)(ii).</p>
<p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&quot;Parent&#39;s
Trustee&quot; shall have the meaning ascribed to it in Section 5.7(c)(iv).</p>
<p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&quot;Permali&quot;
shall have the meaning ascribed to it in Section 5.8(a)(i).</p>
<p>&quot;Permit&quot; shall mean, with respect to any Person, any domestic or
foreign federal, state or local governmental approval, authorization,
certificate, declaration, easement, filing, franchise, license, notice, permit,
variance, clearance, exemption or right to which such Person is a party or that
is or may be binding upon or inure to the benefit of such Person or its
securities, properties or business.</p>
<p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&quot;Person&quot;
shall mean any individual, corporation, partnership, limited liability company,
joint venture, trust, association, organization or other entity.</p>
<p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&quot;Preferred
Stock&quot; shall have the meaning ascribed to it in Section&#160;2.1(b).</p>
<p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&quot;Plascar&quot;
shall have the meaning assigned to it in Section 3.8(a).</p>
<p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&quot;Put
Notice&quot; shall have the meaning ascribed to it in Section 5.20(c).</p>
<p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&quot;Remediation&quot;
shall have the meaning ascribed to it in Section 8.2(e).</p>
<p>&quot;Remediation Standard&quot; shall have the meaning ascribed to it in
Section 8.2(e).</p>
<p>&quot;Representatives&quot; shall have the meaning ascribed to it in Section
5.2(a).</p>
<p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&quot;Requesting
Party&quot; shall have the meaning ascribed to it in Section 5.16(b).</p>
<p>&quot;Required Amount&quot; shall have the meaning ascribed to it in
Section&#160;4.10(a).</p>
<p>&quot;Required Financial Statements&quot; shall have the meaning ascribed to
it in Section&#160;5.9(b).</p>
<p>&quot;Requisite Regulatory Approvals&quot; shall have the meaning ascribed to
it in Section 3.3(a).</p>
<p>&quot;Restricted Field&quot; shall have the meaning ascribed to it in Section
5.11(a).</p>
<p>&quot;Restricted Portion&quot; shall have the meaning ascribed to it in
Section 5.11(b).</p>
<p>&quot;Restriction&quot; shall have the meaning ascribed to it in Section
8.2(b)(i).</p>
<p>&quot;Restructuring&quot; shall have the meaning ascribed to it in Section
2.3.</p>
<p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&quot;Retention
Payment&quot; shall have the meaning ascribed to it in Section 5.7(f)(iv).</p>
<p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&quot;Rosario&quot;
shall have the meaning ascribed to it in Section 5.8(a)(i).</p>
<p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&quot;SEC&quot;
shall have the meaning ascribed to it in Section&#160;4.6(a).</p>
<p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&quot;Securities
Act&quot; shall mean the Securities Act of 1933, as amended.</p>
<p>&quot;Series A Preferred Stock&quot; shall have the meaning ascribed to it in
Section&#160;2.1(b).</p>
<p>&quot;Series B Preferred Stock&quot; shall have the meaning ascribed to it in
Section&#160;2.1(b).</p>
<p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&quot;Series
C Preferred Stock&quot; shall have the meaning ascribed to it in Section 2.1(b).</p>
<p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&quot;Severance
Payment&quot; shall have the meaning ascribed to it in Section 5.7(f)(iii).</p>
<p>&nbsp;</p>
<p>&quot;Shares&quot; shall have the meaning ascribed to it in Section 2.1(a).</p>
<p>&quot;Stand&#45;Alone Pension Plans&quot; shall have the meaning ascribed
to it in Section 5.7(c)(i).</p>
<p>&quot;Straddle Period&quot; shall mean a taxable year or period beginning on
or before, and ending after, the Closing Date.</p>
<p>&quot;Subsidiary&quot; shall mean any corporation, partnership, limited
liability company, joint venture or other legal entity of which a Person, either
alone or together with any other Subsidiary, owns, directly or indirectly, more
than 50% of the stock or other equity interests of such corporation or other
legal entity.</p>
<p>&#160;&#160;&#160;&#160;&#160;&quot;TATB&quot; shall have
the meaning ascribed to it in Section 3.8(a).</p>
<p>&quot;Tax&quot; or &quot;Taxes&quot; shall mean all United States federal,
state, provincial, local, territorial and foreign income, profits, franchise,
license, capital, transfer, ad valorem, wage, severance, occupation, import,
custom, gross receipts, payroll, sales, employment, use, property, real estate,
excise, value added, estimated, stamp, alternative or add&#45;on minimum,
environmental, withholding and any other taxes, duties, assessments or
governmental charges of any kind whatsoever.</p>
<p>&quot;Tax Authority&quot; shall mean any domestic or foreign federal,
national, state, provincial, county or municipal or other local government, any
subdivision, agency, commission or authority thereof, or any
quasi&#45;governmental body exercising any taxing authority or any other
authority exercising Tax regulatory authority.</p>
<p>&#160;&#160;&#160;&#160;&#160;&quot;Tax Benefit&quot;
shall mean the amount of any refund, credit or reduction in otherwise required
Tax payments, including any interest payable thereon, actually realized, <u>provided</u>,
that, for these purposes, Tax items shall be taken into account in accordance
with the ordering principles of the Code or other applicable Law.</p>
<p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&quot;Tax
Detriment&quot; shall mean the amount of any increase in otherwise required Tax
payments, including any interest payable thereon, actually realized, <u>provided</u>,
that, for these purposes, Tax items shall be taken into account in accordance
with the ordering principles of the Code or other applicable Law.</p>
<p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&quot;Tax
Indemnitee&quot; shall have the meaning ascribed to it in Section 5.8(k)(i).</p>
<p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&quot;Tax
Indemnitor&quot; shall have the meaning ascribed to it in Section 5.8(k)(i).</p>
<p>&quot;Tax Return&quot; shall mean any return, report or similar statement
required to be filed with respect to any Tax (including any attached schedules),
including any information return, claim for refund, amended return or
declaration of estimated Tax.</p>
<p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&quot;Textron
Designee&quot; shall have the meaning ascribed to it in Section 5.23(a).</p>
<p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&quot;THI&quot;
shall have the meaning ascribed to it in Section 2.1(a).</p>
<p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&quot;THI
Shares&quot; shall have the meaning ascribed to it in Section 5.20(a).</p>
<p>&quot;Third Party&quot; shall have the meaning ascribed to it in Section
8.1(g)(i).</p>
<p>&quot;Third Party Claim&quot; shall have the meaning ascribed to it in
Section 8.1(e).</p>
<p>&quot;Transactions&quot; shall mean the actions set forth in Sections 2.1 and
2.2.</p>
<p>&quot;Transaction Agreements&quot; shall mean this Agreement, the Transition
Agreement attached hereto as Exhibit 4, the Assignment and Assumption Agreement
attached hereto as Exhibit 2, the License Agreements attached hereto as Exhibits
3A, 3B and 3C and the Registration Rights Agreements attached hereto as Exhibits
5 and 6, and the Asset Purchase Agreement attached hereto as Exhibit 7.</p>
<p>&quot;Transition Agreement&quot; shall mean the Transition Agreement, the
form of which is attached hereto as Exhibit 4.</p>
<p>&quot;Transferred Employee&quot; shall have the meaning ascribed to it in
Section 5.7(a).</p>
<p>&quot;Two&#45;Month Cash Amount&quot; shall have the meaning ascribed to
it in Section 2.4(c)(i).</p>
<p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&quot;U.S.
Bison Subsidiary&quot; shall mean a Bison Subsidiary organized under the laws of
a state of the United States of America.</p>
<p>&quot;WARN Act&quot; shall have the meaning ascribed to it in Section
3.10(b).</p>
<p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&quot;Working
Capital&quot; shall mean (a) the sum of net accounts receivable, inventory and
other current assets, excluding cash and cash equivalents and income Tax assets,
minus (b) the sum of net accounts payable and other current liabilities,
excluding the current portion of Balance Sheet Indebtedness of the Bison
Subsidiaries, accrued interest and any liability for income Taxes. Working
Capital shall be computed without regard to (i) any changes in GAAP since
December 30, 2000 using the same accounting principles used in computing the
working capital set forth in Section 2.4(c) of the Disclosure Schedule, (ii) any
accounts payable associated with leases for equipment covered by the
transactions contemplated by Section 5.21 and (iii) any accounts payable
associated with payments to be made by Parent pursuant to Section 5.22.</p>
<font COLOR="#ff0000">
<p>1.2 </font><u><a NAME="_Toc532024458">Effectiveness of Agreement</a></p>
</u>
<p>. For the avoidance of doubt, this Agreement, as amended as of November 30,
2001, shall be deemed to be effective as of August 7, 2001, and any and all
references to &quot;the date of this Agreement&quot; and &quot;the date
hereof&quot; shall be deemed to refer to August 7, 2001.</p>
<font COLOR="#ff0000">
<p ALIGN="CENTER">ARTICLE II<a NAME="_Toc503343059"></a><a NAME="_Toc503343304"></a></font><br>
<br>
<a NAME="_Toc503342958"></a><a NAME="_Toc503343908"></a><a NAME="_Toc503667890"></a><a NAME="_Toc503684821"></a><a NAME="_Toc504459512"></a><a NAME="_Toc505070775"></a><a NAME="_Toc505137371"></a><a NAME="_Toc505767617"></a><a NAME="_Toc506346187"></a><a NAME="_Toc506628504"></a><a NAME="_Toc506775314"></a><a NAME="_Toc507592180"></a><a NAME="_Toc508437253"></a><a NAME="_Toc508709201"></a><a NAME="_Toc514731987"></a><a NAME="_Toc514732725"></a><a NAME="_Toc516384235"></a><a NAME="_Toc516456557"></a><a NAME="_Toc516460917"></a><a NAME="_Toc516463333"></a><a NAME="_Toc516560518"></a><a NAME="_Toc518363213"></a><a NAME="_Toc518466793"></a><a NAME="_Toc518732996"></a><a NAME="_Toc518733440"></a><a NAME="_Toc519520810"></a><a NAME="_Toc519700984"></a><a NAME="_Toc520104831"></a><a NAME="_Toc520108685"></a><a NAME="_Toc520261493"></a><a NAME="_Toc520609422"></a><a NAME="_Toc521132919"></a><a NAME="_Toc521304941"></a><a NAME="_Toc521330718"></a><a NAME="_Toc521426430"></a><a NAME="_Toc521468829"></a><a NAME="_Toc52
1492879"></a><a NAME="_Toc529701214"></a><a NAME="_Toc529706153"></a><a NAME="_Toc529947342"></a><a NAME="_Toc530205062"></a><a NAME="_Toc530215668"></a><a NAME="_Toc530801226"></a><a NAME="_Toc531699820"></a><a NAME="_Toc531805622"></a><a NAME="_Toc532024459">PURCHASE
AND SALE OF SHARES</a></p>
<p ALIGN="CENTER">&nbsp;</p>
<p>&nbsp;</p>
<font COLOR="#ff0000">
<p>2.1 <a NAME="_Toc503342959"></a><a NAME="_Toc503343060"></a><a NAME="_Toc503343305"></a></font><u><a NAME="_Toc532024460">Purchase
and Sale of Shares</a></p>
</u>
<p>.</p>
<p>(a) Subject to the terms and conditions of this Agreement, at the Closing,
Parent shall sell, transfer, convey, assign and deliver, or shall cause its
applicable Subsidiaries to sell, transfer, convey, assign and deliver, to the
entities specified on Schedule F hereto, and said entities shall purchase,
acquire and accept or cause its wholly owned Subsidiaries to purchase, acquire
and accept, from Parent or its applicable Subsidiaries, all of the issued and
outstanding shares of capital stock of the Directly Purchased Subsidiaries
(other than Textron Automotive Holdings Italy S.r.l. (&quot;THI&quot;) and
excluding directors&#39; qualifying shares) and 50% of the outstanding
shares of THI (collectively, the &quot;Shares&quot;), free and clear of all
Liens (without regard to subsections (i) through (iv) of the provision in the
definition of &quot;Liens&quot;) for 13,237 shares of Series A Preferred Stock,
and an amount of cash equal to six hundred sixty&#45;nine million one
hundred eighty thousand dollars ($669,180,000) minus (A) fifty eight million
seven hundred eighty thousand dollars ($58,780,000) and (B) the amount of any
additional sales proceeds resulting from the sale of additional equipment and/or
property pursuant to Section 5.21(a).</p>
<p>(b) Subject to the terms and conditions of this Agreement, at the Closing,
Parent shall cause its applicable Subsidiary to contribute all of the issued and
outstanding shares of capital stock of Textron Automotive Exteriors Inc., a
Delaware corporation and a wholly owned indirect Subsidiary of Parent, free and
clear of all Liens (without regard to subsections (i) through (iv) of the
provision in the definition of Liens), to C&A Products in exchange for (i)
169,463 shares of Series A1 Redeemable Preferred Stock, liquidation preference
$1,000 per share, of C&A Products (the &quot;Series A Preferred
Stock&quot;), (ii) 123,700 shares of Series B1 Redeemable Preferred Stock,
liquidation preference $1,000 per share, of C&A Products (the &quot;Series B
Preferred Stock&quot;), (iii)<b> </b>20,000 shares of Series C1 Redeemable
Preferred Stock, liquidation preference $1,000 per share, of C&A Products
(the &quot;Series C Preferred Stock&quot;), and (iv) eighteen million
(18,000,000) shares of common stock, par value $.01 per share, of Holdings (the
&quot;Holdings Common Stock&quot;). The relative rights, preferences and
limitations of the Series A Preferred Stock, Series B Preferred Stock and Series
C Preferred Stock (collectively, the &quot;Preferred Stock&quot;) will be as set
forth in the Certificate of Designation of C&A Products attached hereto as
Exhibit 1 (the &quot;Certificate of Designation&quot;). Parent, Holdings and
C&A Products hereby agree that the fair market value of the Preferred Stock
is equal to four hundred fifty dollars ($450) per share. It is acknowledged by
the parties hereto that under the terms of the Debt Commitment Letter, the
Preferred Stock may be required to be issued by Holdings.</p>
<font COLOR="#ff0000">
<p>2.2 </font><u><a NAME="_Toc532024461">Purchase and Sale of Assets</a></p>
</u>
<p>&nbsp;</p>
<p>(a) Parent shall cause one of its Subsidiaries to sell, transfer, convey,
assign and deliver to the entity specified on Schedule F all Intellectual
Property identified in Section C&#45;2 of the Disclosure Schedule which is,
as of the date hereof, owned and in the name of Textron Automotive Company Inc.,
a Delaware corporation, for a purchase price of fifteen million dollars
($15,000,000) payable in cash. (A list of the Intellectual Property being sold
pursuant to this section together with appropriate documents of transfer will be
provided to C&A Products or its designated Subsidiary at the Closing.)</p>
<p>(b) On the day prior to the Closing Date, certain assets currently owned by
Textron Automotive Exteriors Inc. shall be sold to JPS Automotive, Inc., a
Subsidiary of C&A Products, pursuant to an Asset Purchase Agreement
substantially in the form attached hereto as Exhibit 7. The parties agree that
the fair market value of the assets sold pursuant to said agreement is
eighty&#45;four million seven hundred thirty&#45;nine thousand nine
hundred seventy&#45;one dollars ($84,739,971).</p>
<font COLOR="#ff0000">
<p>2.3 <a NAME="_Toc503342960"></a><a NAME="_Toc503343061"></a><a NAME="_Toc503343306"></a></font><u><a NAME="_Toc532024462">Restructuring</a></p>
</u>
<p>. Prior to the Closing Date, Parent shall take such actions as may be
necessary or appropriate to (a) cause the Subsidiaries of the Directly Purchased
Subsidiaries to be those listed on Schedule B hereto and (b) effect the
transfers of the Subsidiaries, assets, liabilities, businesses and employees
listed on Schedule C hereto (such actions are collectively referred to as the
&quot;Restructuring&quot;). The Directly Purchased Subsidiaries together with
their Subsidiaries listed on Schedule B and Textron Automotive Exteriors Inc.
are collectively referred to herein as the &quot;Bison Subsidiaries.&quot;</p>
<font COLOR="#ff0000">
<p>2.4 <a NAME="_Toc503342962"></a><a NAME="_Toc503343063"></a><a NAME="_Toc503343308"></a></font><u><a NAME="_Toc532024463">Purchase
Price Adjustment</a></p>
</u>
<p>&nbsp;</p>
<p>(a) As soon as practicable, but in any event not more than 70 days after the
Closing Date, unless otherwise extended by the mutual agreement of Parent and
Holdings, Parent shall deliver to Holdings a statement of net assets to be sold
as of the Closing Date, including information necessary to determine the Working
Capital, Balance Sheet Indebtedness and Closing Cash at such date (but without
giving effect to the Closing and the transactions covered by the Asset Purchase
Agreement specified in Section 2.2(b)) (the &quot;Closing Financial
Statement&quot;), together with a report of E&Y thereon to the effect that
such statement fairly presents in all material respects the financial position
of the Bison Subsidiaries as of said date, and that such statement has been
prepared in accordance with GAAP applied on a basis consistent with the December
30, 2000 Statement of Net Assets to be Sold (including the elimination of the
corporate overhead items identified in Part B of Section 3.4 of the Disclosure
Schedule but except that M&C Advanced Processes is included in the Closing
Financial Statements), except (i) for any accounting changes mandated by
accounting regulators and (ii) as set forth in Part A of Section 3.4 of the
Disclosure Schedule. All costs and expenses incurred by Parent in connection
with the preparation and delivery of the Closing Financial Statement shall be
borne equally by Parent and Holdings.</p>
<p>(b) Subject to Section 2.4(e), if Working Capital plus Balance Sheet
Indebtedness on the Closing Date is less than negative one hundred eight million
nine hundred thousand dollars ($&#45;108,900,000), the difference between
Working Capital plus Balance Sheet Indebtedness and negative $108,900,000 shall
be paid by Parent to C&A Products. Subject to Section 2.4(e), if Working
Capital plus Balance Sheet Indebtedness on the Closing Date is more than
negative one hundred eight million nine hundred thousand dollars
($&#45;108,900,000), the difference between Working Capital plus Balance
Sheet Indebtedness and negative $108,900,000 shall be paid by C&A Products
to Parent. For the purposes of calculating the purchase price adjustment set
forth in this section, Balance Sheet Indebtedness shall be deemed to be a
negative number.</p>
<p>(c)</p>
<blockquote>
  <blockquote>
    <p>(i) Subject to Section 2.4(e), if the Closing Cash on the Closing Date is
    greater than zero, the difference between zero and the Closing Cash shall be
    paid by C&A Products to Parent. Subject to Section 2.4(e), if the
    Closing Cash on the Closing Date is less than zero, the difference between
    zero and the Closing Cash shall be paid by Parent to C&A Products. If
    the Closing Cash on the Closing Date of any Bison Subsidiary incorporated in
    a jurisdiction other than a state of the United States of America is greater
    than the sum of payments to employees and suppliers during the last two
    fiscal months ended prior to the Closing Date (the &quot;Two&#45;Month
    Cash Amount&quot;), then the amount payable to Parent pursuant to the first
    sentence of Section 2.4(c) shall be reduced by the amount of the Closing
    Cash on the Closing Date of the applicable Subsidiary which is in excess of
    the Two&#45;Month Cash Amount multiplied by the withholding Tax rate
    applicable to dividends paid by the applicable Bison Subsidiary; <u>provided</u>
    that during such two&#45;month period payments to employees and
    suppliers shall be made consistent with past practice.</p>
    <p>(ii)&#160;&#160;&#160;&#160;&#160;Subject to Section
    2.4(e), if the Closing has not occurred prior to the Capital Expenditure
    Date, C&A Products will pay Parent any amount by which capital
    expenditures for assets not recorded on the financial statements prior to
    the Capital Expenditure Date during the period beginning on the Capital
    Expenditure Date and ending on the Closing Date (excluding capital
    expenditures made by THI and its Subsidiaries) exceed depreciation
    attributable to the Business during that period (excluding depreciation
    attributable to THI and its Subsidiaries). No later than the delivery of the
    Closing Financial Statement, Parent shall deliver a certificate of its Chief
    Financial Officer certifying to the amount payable, if any, pursuant to this
    section. The term &quot;Capital Expenditure Date&quot; shall mean October 1,
    2001; <u>provided</u>, <u>however</u>, that if the financial statements
    required to be delivered to C&A Products pursuant to Section 5.9(a), are
    not delivered by August 31, 2001, the Capital Expenditure Date shall be
    extended by the number of days by which the deadline is not met.</p>
  </blockquote>
</blockquote>
<p>(d) Subject to Section 2.4(e), payments required pursuant to Section 2.4(b)
and 2.4(c)(i) shall be made within 60 days after the date of receipt by Holdings
of the Closing Financial Statement, and payments required pursuant to Section
2.4(c)(ii) shall be made 180 days after the Closing Date (or, if such day is not
a business day, on the next succeeding business day). Payments shall be made by
wire transfer of immediately available funds to one or more accounts specified
at least two business days prior to such date by the party who shall receive the
funds. Any such payment shall be made together with interest thereon at the
Interest Rate, payable for the period commencing on the Closing Date and ending
on the day immediately prior to the date such payment is made.</p>
<p>&nbsp;(e) Holdings may dispute any amounts used in the calculation of the purchase
price adjustment pursuant to Sections 2.4(b) or 2.4(c)(i) as reflected on the
Closing Financial Statement or the purchase price adjustment pursuant to Section
2.4(c)(ii) that involves a proposed adjustment with respect to any single item
of more than $50,000 but only to the extent that proposed adjustments exceeding
$50,000 exceed, in the aggregate, $500,000; <u>provided</u>, <u>however</u>,
that Holdings shall notify Parent in writing (the &quot;Dispute Notice&quot;) of
each disputed item, specifying the amount thereof in dispute and setting forth,
in reasonable detail, the basis for such dispute, within 45 days of
Holdings&#39; receipt of the Closing Financial Statement; <u>provided</u> <u>further</u>,
<u>however</u>, that if an account or item is recorded or treated in a manner
consistent with past practice and, if applicable, with the December 30, 2000
Statement of Net Assets to be Sold, then, provided that such recording or
treatment does not prevent the Closing Financial Statement from being in
accordance with GAAP,<b> </b>it must be accepted as correct by Holdings for
purposes of this Section 2.4. Holdings shall submit only one Dispute Notice
containing all disputed items. In the event of such a dispute, Holdings and
Parent shall attempt to reconcile their difference, and any resolution by them
as to any disputed amounts shall be final, binding and conclusive. If Holdings
and Parent are unable to reach a resolution with such effect within 30 days of
the receipt by Parent of the Dispute Notice, Holdings and Parent shall submit
the items remaining in dispute for resolution to the Independent Accounting Firm
which shall, within 30 days after submission, determine and report to the
parties upon such remaining disputed items, and such report shall be final,
binding and conclusive on the parties hereto. All costs and expenses of the
Independent Accounting Firm relating to the disputed items shall be allocated
between Parent and Holdings in the same proportion that the aggregate dollar
amount of the items unsuccessfully disputed by each party bears to the total
dollar amount of the items disputed under such notice. The term
&quot;Independent Accounting Firm&quot; shall mean Deloitte & Touche LLP or
such other firm as Holdings and Parent shall agree.</p>
<p>(f) Notwithstanding any dispute pursuant to Section 2.4(e) of any amounts
payable pursuant to this Section 2.4, the applicable party shall at the time
specified in Section 2.4 pay that portion of the amounts payable by it pursuant
to this Section 2.4 that are not subject at the time of such payment to any
dispute. Any amount payable following resolution of a matter specified in a
Dispute Notice shall be paid within five (5) business days following the
resolution thereof.</p>
<p>(g) During the periods in which (i) the Closing Financial Statement is being
prepared or (ii) any dispute is raised as contemplated by Section 2.4(e), Parent
and Holdings shall provide each other, including their Representatives, with
reasonable access, during normal business hours and without disruption to their
day&#45;to&#45;day business, to their respective books, records and
facilities pertaining to the Bison Subsidiaries and the Transactions to the
extent affecting the Bison Subsidiaries, including any consolidated or combined
returns, schedules, consolidated or combined work papers and other related
documents; <u>provided</u>, however, that with respect to consolidated,
combined, unitary or similar Tax Returns which include Parent (or any Subsidiary
of Parent, other than a Bison Subsidiary (a &quot;Non&#45;Bison
Subsidiary&quot;)) on the one hand and any of the Bison Subsidiaries on the
other hand, Holdings shall only have access to portions of such Tax Returns
relev<a NAME="_Toc503342963"></a><a NAME="_Toc503343064"></a><a NAME="_Toc503343309">ant
to the Bison Subsidiaries.</p>
<p>2.5 </a><a NAME="_Toc532024464"><u>Allocation of Consideration; Tax Filings</u>.</a></p>
<p>(a) The consideration attributable to the purchase of the Directly Purchased
Subsidiaries, including the sales proceeds resulting from the transactions
specified in Section 5.21 and the present value of the Earn&#45;Out Amount
specified in Section 2.8, shall be allocated among the Shares as set forth in
Schedule D hereto. Within 30 days after the determination of the adjustments
pursuant to Section 2.4 and any adjustments accounting for the sale proceeds
resulting from the transactions specified in Section 5.21, Parent shall deliver
to Holdings a schedule (the &quot;Adjustment Schedule&quot;) allocating said
adjustments among the Shares, and also accounting for any difference between the
Balance Sheet Indebtedness of the Bison Subsidiaries existing on the Closing
Date and $76,900,000, in a manner consistent with the allocation methodology
used in determining the allocation set forth in Schedule D.</p>
<p>(b) Holdings may dispute any allocation set forth on the Adjustment Schedule;
provided, however, that (i) Holdings shall not dispute any of the original
allocations set forth in Schedule D and (ii) Holdings shall notify Parent in
writing (the &quot;Allocation Dispute Notice&quot;) of each disputed item,
specifying the allocation in dispute and setting forth, in reasonable detail,
the basis for such dispute within 30 days of Holdings&#39; receipt of the
schedule. Holdings shall submit only one Allocation Dispute Notice containing
all disputed allocations. In the event of such a dispute, Holdings and Parent
shall attempt to reconcile their differences and any resolution by them as to
any disputed allocations shall be final, binding and conclusive. If Holdings and
Parent are unable to reach a resolution with such effect within 30 days of the
receipt by Parent of the Allocation Dispute Notice, Holdings and Parent shall
submit the items remaining in dispute for resolution to the Independent
Accounting Firm which shall, within 30 days after submission, determine and
report to the parties upon such remaining disputed allocations, and such report
shall be final, binding and conclusive on the parties hereto. All costs and
expenses of the Independent Accounting Firm relating to the disputed allocations
shall be borne equally by Parent and Holdings; provided, however, that if the
Independent Accounting Firm determines that the position asserted by one of the
parties in such dispute is substantially in error, then all such costs and
expenses shall be borne by the party so determined to be in error.</p>
<p>(c) Upon agreement of the parties with respect to the Adjustment Schedule, or
the completion of a report prepared by the Independent Accounting Firm pursuant
to Section 2.5(b), a schedule (the &quot;Final Allocation Schedule&quot;)
setting forth the allocation among the Shares as specified in Section 2.5(a) and
modified pursuant to Section 2.5(b) shall be prepared by the parties. Each of
Holdings and Parent shall (i) timely file with each relevant Tax Authority all
forms and Tax Returns required to be filed in connection with the allocation set
forth in the Final Allocation Schedule, (ii) be bound by such allocation for
purposes of determining Taxes, (iii) prepare and file, and cause their
respective Affiliates to prepare and file, their Tax Returns on a basis
consistent with such allocation, and (iv) not take any position, or cause their
respective Affiliates to take any position, inconsistent with such allocation on
any Tax Return, in any audit or proceeding before any Tax Authority or in any
report made for Tax purposes; provided, however, that, notwithstanding anything
in this Section 2.5 to the contrary, (i) the parties shall be permitted to take
a position inconsistent with that set forth in this Section 2.5 if required to
do so by a final and unappealable decision, judgment, decree or other order by
any court of competent jurisdiction, and (ii) with respect to any of the
transactions contemplated by this Agreement, Parent, Holdings or C&A
Products may pursue a pre&#45;filing agreement in accordance with Revenue
Procedure 2001&#45;22 (or any successor pronouncement), and upon the request
of the party pursuing a pre&#45;filing agreement the other parties shall
(and shall cause their respective Affiliates to) provide their reasonable
cooperation and assistance in obtaining any such pre&#45;filing agreement.</p>
<font COLOR="#ff0000">
<p>(d)</p>
<blockquote>
  <blockquote>
  </font>
  <p>(i) Parent, Holdings and C&A Products hereby agree to treat the
  transactions pursuant to Section 2.1(a) for Tax purposes as taxable sales of
  the Shares in exchange for the consideration set forth in Section 2.1(a)
  subject to the recognition of gains or losses, as the case may be, pursuant to
  Section 1001(c) of the Code.</p>
  <p>(ii) Parent, Holdings and C&A Products hereby agree to treat the
  transaction pursuant to Section 2.1(b) for Tax purposes as a transaction
  described in Section 351 of the Code.</p>
  <p>(iii) Parent, Holdings and C&A Products hereby agree to treat the
  transaction pursuant to Section 2.2(a) for Tax purposes as a taxable sale of
  the Intellectual Property in exchange for the consideration set forth in
  Section 2.2(a) subject to the recognition of gain or loss, as the case may be,
  pursuant to Section 1001(c) of the Code.</p>
  <p>(iv) Parent, Holdings and C&A Products hereby agree to treat the
  transaction pursuant to Section 2.2(b) for Tax purposes as a taxable sale of
  the assets described in the Asset Purchase Agreement in exchange for the
  consideration set forth in the Asset Purchase Agreement subject to the
  recognition of gain or loss, as the case may be, pursuant to Section 1001(c)
  of the Code.</p>
  <font FACE="Courier New">
  </blockquote>
</blockquote>
</font><font COLOR="#ff0000">
<p>2.6 </font><u><a NAME="_Toc532024465">Closing</a></p>
</u>
<p>.</p>
<p>(a) Parent shall as promptly as possible notify Holdings, and Holdings shall
as promptly as possible notify Parent, when the conditions set forth in Article
VI to such party&#39;s obligations to complete the Transactions have been
satisfied or waived. The closing of the Transactions (the &quot;Closing&quot;)
shall take place at the offices of Skadden, Arps, Slate, Meagher & Flom LLP,
Four Times Square, New York, New York at 10:00 a.m. New York time on the second
business day following the satisfaction or waiver of the conditions set forth in
Article VI, or at such other time, date and place as Parent and Holdings may
agree; <u>provided</u>, <u>however</u>, that the Closing Date shall not be
earlier than 45 days after the delivery of the financial statements required by
Sections 5.9(a)(i) and (ii), and <u>provided</u> further that, with respect to
the purchase and sale of the issued and outstanding shares of capital stock of
any Directly Purchased Subsidiary which is organized in a foreign jurisdiction,
at the request of Parent, Holdings shall agree to have the closing with respect
to the purchase and sale of such shares of capital stock take place in the
jurisdiction in which the Directly Purchased Subsidiary is organized. The date
on which the Closing occurs is referred to herein as the &quot;Closing
Date.&quot;</p>
<p>(b) Notwithstanding the foregoing, if the only conditions to Closing set
forth in Article VI that have not been satisfied or waived are the conditions
set forth in Section 6.2(g), Section 6.2(i) and Section 6.3(f), then the Closing
shall nevertheless proceed as set forth in Section 2.6(a), except that Parent
shall retain the shares of THI that otherwise were to be sold to Collins &
Aikman Automotive Systems Italy S.r.l. pursuant to Section 2.1(a), and the
amount of cash set forth therein shall be reduced by twenty&#45;two million
six hundred thousand dollars ($22,600,000). Parent shall as promptly as possible
notify Holdings, or Holdings shall as promptly as possible notify Parent, when
the condition set forth in Section 6.2(i) is satisfied or waived. The closing
with respect to the purchase and sale of the shares of THI shall take place at
the time and location set forth in Section 2.6(a).</p>
<p>2.7 <a NAME="_Toc503342964"></a><a NAME="_Toc503343065"></a><a NAME="_Toc503343310"></a><a NAME="_Toc532024466"><u>Closing
Obligations</u></a></p>
<p>(a) At the Closing, Parent shall deliver, or cause to be delivered, to
Holdings or C&A Products:</p>
<blockquote>
  <blockquote>
    <p>(i) certificates representing the Shares and all of the issued and
    outstanding shares of capital stock of Textron Automotive Exteriors Inc.
    duly endorsed (or accompanied by duly executed stock powers) for transfer to
    C&A Products or a designated Subsidiary or Subsidiaries of C&A
    Products or, if Parent&#39;s and its&#39; Subsidiaries&#39;
    ownership of the Directly Purchased Subsidiaries is not evidenced by share
    certificates, such other evidence of transfer to C&A Products or a
    designated Subsidiary or Subsidiaries of C&A Products consistent with
    the laws of the jurisdiction of organization of the applicable Directly
    Purchased Subsidiary;</p>
    <p>(ii) the Officer&#39;s Certificate described in Section 6.2(c);</p>
    <p>(iii) the resignation of any officer or director of any Bison Subsidiary
    who is an employee or director of Parent or a Non&#45;Bison Subsidiary;</p>
    <p>(iv) a certificate under Section 1445(b)(2) of the Code providing that
    Parent is not a foreign person, in form and substance reasonably
    satisfactory to Holdings;</p>
    <p>(v) a duly executed Assignment and Assumption Agreement and Transition
    Agreement substantially in the forms attached hereto as Exhibits 2 and 4
    respectively;</p>
    <p>(vi) duly executed License Agreements substantially in the forms attached
    hereto as Exhibits 3A, 3B and 3C;</p>
    <p>(vii) duly executed Registration Rights Agreements substantially in the
    forms attached hereto as Exhibits 5 and 6;</p>
    <p>(viii) duly executed documents to effect the sale and transfer of
    Intellectual Property required by Section 2.2(a);</p>
    <p>(ix) the Italian JV Documents substantially in the forms attached hereto
    as Exhibits 8 through 11 duly executed by each applicable Subsidiary of
    Parent (provided, that such documents shall only be required to be delivered
    at the Closing of the purchase and sale of the shares of THI); and</p>
    <p>(x) Leasing Documents duly executed by Textron Financial Corporation or
    one of its Affiliates.</p>
  </blockquote>
</blockquote>
<p>(b) At the Closing, Holdings and C&A Products shall deliver to Parent or
a designated Subsidiary of Parent:</p>
<blockquote>
  <blockquote>
    <p>(i) one or more certificates representing the number of shares of
    Holdings Common Stock specified in Section 2.1(b);</p>
    <p>(ii) certificates representing the Preferred Stock;</p>
    <p>(iii) the Officer&#39;s Certificate described in Section 6.3(c);</p>
    <p>(iv) a duly executed Assignment and Assumption Agreement and Transition
    Agreement substantially in the forms attached hereto as Exhibits 2 and 4
    respectively;</p>
    <p>(v) duly executed License Agreements substantially in the forms attached
    hereto as Exhibits 3A, 3B and 3C;</p>
    <p>(vi) duly executed Registration Rights Agreements substantially in the
    forms attached hereto as Exhibits 5 and 6;</p>
    <p>(vii) the cash amounts set forth in Sections 2.1 and 2.2 by wire transfer
    of immediately available funds to accounts designated by Parent in writing
    at least two business days prior to the Closing Date;</p>
    <p>(viii) the Italian JV Documents substantially in the forms attached
    hereto as Exhibits 8 through 11 duly executed by each applicable Subsidiary
    of C&A Products (provided, that such documents shall only be required to
    be delivered at the Closing of the purchase and sale of the shares of THI);
    and</p>
    <p>(ix) The guarantee required by Exhibit 12 duly executed by C&A
    Products.</p>
  </blockquote>
</blockquote>
<font COLOR="#ff0000">
<p>2.8 </font><u><a NAME="_Toc532024467">Earn&#45;Out</a></p>
</u>
<p>(a) If the aggregate EBITDA, as defined below, of Holdings for the five
fiscal years ending December 31, 2006 equals or exceeds two billion nine hundred
eight million dollars ($2,908,000,000), then C&A Products and/or any of its
Subsidiaries shall pay Parent and/or designated Subsidiaries of Parent the
earn&#45;out amount specified in Schedule G hereto (the
&quot;Earn&#45;Out Amount&quot;). Earn&#45;Out Amounts between the fixed
points including and in excess of three billion two hundred ninety seven million
dollars ($3,297,000,000) in the column on Schedule G entitled
&quot;5&#45;Year Cumulative EBITDA&quot; shall be determined by
interpolation. The term &quot;EBITDA&quot; shall mean (i) the Consolidated Cash
Flow, minus Projected Time Adjusted Acquisition Cash Flow (excluding any
Consolidated Cash Flow attributable to any Receivables Financing Subsidiary),
provided that (A) the term &quot;EBITDA&quot; shall be substituted for the term
&quot;Adjusted Consolidated Pro Forma Coverage Ratio&quot; in the applicable
definitions, (B) the term &quot;consolidated Subsidiary&quot; shall be
substituted for the term &quot;Restricted Subsidiary&quot; in the applicable
definitions, (C) any net income or loss described in section (vi) of the
definition of Consolidated Net Income shall be included in the calculation of
Consolidated Net Income and (D) lease payments, or the functional equivalent
thereof (including payments of principal and interest in connection with any
synthetic lease arrangement or similar financing arrangement), relating to the
equipment initially subject to the transaction described in Section 5.21 shall
be added to Consolidated Cash Flow to the extent such payments were deducted in
computing Consolidated Net Income, <u>plus</u> (ii) to the extent that it is not
included in the calculation of Consolidated Cash Flow pursuant to (i), (x) the
Consolidated Cash Flow minus Projected Time Adjusted Acquisition Cash Flow, but
substituting the term &quot;Textron Automotive Holdings Italy S.r.l.&quot; for
the term &quot;Company&quot; and deleting the term &quot;Restricted
Subsidiary&quot; in all applicable definitions, and (y) discounts and interest
relating to factoring. (Capitalized terms in the immediately preceding sentence
shall have the meaning ascribed to them in the Certificate of Designation.) All
claims to Earn&#45;Out Amounts are subordinate to any amounts due under the
financings described in the Debt Commitment Letter.</p>
<font FACE="Courier New">
<blockquote>
  <blockquote>
  </font>
  <p>(i) Within 120 days after the end of each of the five fiscal years ending
  on December 31, 2006, Holdings shall deliver to Parent audited financial
  statements of Holdings and its consolidated Subsidiaries, including a balance
  sheet as at the end of the applicable fiscal year and statements of income and
  cash flows for the respective twelve month period then ended. The financial
  statements shall be accompanied by a certificate signed by the President and
  the Chief Financial Officer of Holdings setting forth in reasonable detail the
  computation of EBITDA for the year then ended. Holdings shall promptly give
  Parent access to documents and other information reasonably requested by
  Parent for the purpose of assessing the accuracy of the EBITDA calculation.</p>
  <p>(ii) Within 60 days of any Asset Acquisition (as defined in the Certificate
  of Designation) occurring following the Closing Date and prior to December 31,
  2006, Holdings shall deliver a certificate of its Chief Financial Officer to
  Parent as to the related Certified Projections (as defined in the Certificate
  of Designation), prepared on the basis set forth in the Certificate of
  Designation, for the purpose of future calculations of EBITDA as set forth
  above.</p>
  <font FACE="Courier New">
  </blockquote>
</blockquote>
</font>
<p>(b) Parent may dispute the calculation of EBITDA (but not the applicable
Certified Projections) with respect to any year by delivering a notice to
Holdings within 45 days after receiving the EBITDA certification specified above
for the fiscal year ended December 31, 2006, which notice shall specify in
reasonable detail the basis for the dispute. If the parties are unable to
resolve the dispute within 30 days after delivery of the aforesaid notice, the
matter shall be submitted for resolution by the Independent Accounting Firm
which shall, within 30 days after submission, determine and report to the
parties upon the disputed items, and such report shall be final, binding and
conclusive on the parties hereto. All costs and expenses of the Independent
Accounting Firm shall be allocated between Parent and Holdings in the same
proportion that the aggregate dollar amount of the items unsuccessfully disputed
by each party bears to the total dollar amount of the items disputed under such
notice. Subject to Section 2.8(e), any amount payable to Parent shall be paid
within five (5) business days following the resolution of the dispute.</p>
<p>(c) Subject to Section 2.8(d) and completion of the dispute resolution
mechanism referred to in Section 2.8(b), the Earn&#45;Out Amount shall be
paid on or before 180 days after delivery of the financial statements and EBITDA
certification specified in Section 2.8(a) for the fiscal year ended December 31,
2006. The Earn&#45;Out Amount shall be paid in immediately available funds
by wire transfer to one or more accounts specified by Parent at least two
business days prior to the payment date.</p>
<p>(d) Holdings will use commercially reasonable efforts to negotiate debt
covenants in instruments governing Indebtedness of Holdings and its Subsidiaries
that are customary for companies with its credit ratings and credit statistics
and the type of financing involved. In the event that payment of the
Earn&#45;Out Amount would cause Holdings or any of its Subsidiaries to be in
breach of any agreement or instrument governing Indebtedness involving a
principal amount, individually or in the aggregate, of $5.0&#160;million or
more (a &quot;Material Breach&quot;), C&A Products (or, in the event the
issuer of the other series of Preferred Stock is Holdings, Holdings) will be
permitted to issue shares of Series B Preferred Stock or, if permitted by the
terms of Section 1(c) of the Certificate of Designation, another series of
Preferred Stock with terms identical to the Series B Preferred Stock, other than
that (a) it may be optionally redeemed at any time at a redemption price equal
to its Liquidation Preference, plus any accrued and unpaid dividends,
(b)&#160;it must be mandatorily redeemed as set forth below at a redemption
price equal to its Liquidation Preference, plus any accrued and unpaid dividends
and (c) it must be convertible from time to time at the option of the holder, in
whole or in part, into shares of Series B Preferred Stock, if such shares of
Series B Preferred Stock will be fungible with any outstanding shares of Series
B Preferred Stock from a Tax perspective, provided, that Preferred Stock will be
issued only to the extent necessary to avoid any such breach; <u>provided</u>, <u>further</u>,
<u>however</u>, that the terms requiring a mandatory redemption shall only be
required to be included in such Preferred Stock to the extent that doing so
itself would not cause a Material Breach. The Liquidation Preference and, if
applicable, related accrued and compounded dividends (all calculated as set
forth in the Certificate of Designation) of the shares of Preferred Stock issued
in lieu of payment of the Earn&#45;Out Amount will be equal to that of the
Earn&#45;Out Amount not paid in cash. Holdings and C&A Products hereby
agree that following the issuance of any Preferred Stock in lieu of payment of
the Earn&#45;Out Amount in cash, the issuer thereof is obligated, within 30
days following any date upon which it would be permitted to redeem all or any
portion of such Preferred Stock without causing a Material Breach, to do so,
whether in one instance or as permitted from time to time.</p>
<p>(e) For purposes of computing the amount of consideration attributable to the
purchase of the Directly Purchased Subsidiaries under Section 2.5, the present
value of the Earn&#45;Out Amount shall be thirty eight million dollars
($38,000,000). Within 45 days of the payment of the Earn&#45;Out Amount by
Holdings pursuant to this Section 2.8, Parent shall provide Holdings with an
accounting of the payment, for Tax purposes, setting forth the amount of the
payment that constitutes interest and the amount of the payment that constitutes
principal, computed in accordance with the principles of Section 483 of the Code
and the Treasury Regulations promulgated thereunder. Holdings may dispute any
portion of the accounting. In the event of such a dispute, Holdings and Parent
shall attempt to reconcile their differences in accordance with the dispute
resolution procedures set forth in Section 2.5(b). Each of Holdings and Parent
shall (i) timely file with each relevant Tax Authority all forms and Tax Returns
required to be filed in connection with such accounting, (ii) be bound by such
filings, (iii) prepare and file, and cause their respective Affiliates to
prepare and file, their Tax Returns on a basis consistent with such accounting
and (iv) not take any position, or cause their respective Affiliates to take any
position, inconsistent with such accounting on any Tax Return, in any audit or
proceeding before any Tax Authority or in any report made for Tax purposes, <u>provided</u>,
<u>however</u>, that, notwithstanding anything in this Section 2.8 to the
contrary, the parties shall be permitted to take a position inconsistent with
that set forth in this Section 2.8 if required to do so by a final and
unappealable decision, judgment, decree or other order by any court of competent
jurisdiction or Taxing Authority provided further however notwithstanding the
foregoing provisions of this Section&#160;2.8(e), if a party reasonably
expects that a failure to do so will subject that party to penalties, that party
is permitted to take positions inconsistent with that set forth in this
Section&#160;2.8.</p>
<font COLOR="#ff0000">
<p ALIGN="CENTER">ARTICLE III<a NAME="_Toc503343066"></a><a NAME="_Toc503343311"></a></font><br>
<br>
<a NAME="_Toc503342965"></a><a NAME="_Toc503343915"></a><a NAME="_Toc503667897"></a><a NAME="_Toc503684828"></a><a NAME="_Toc504459519"></a><a NAME="_Toc505070782"></a><a NAME="_Toc505137378"></a><a NAME="_Toc505767624"></a><a NAME="_Toc506346195"></a><a NAME="_Toc506628512"></a><a NAME="_Toc506775322"></a><a NAME="_Toc507592188"></a><a NAME="_Toc508437261"></a><a NAME="_Toc508709209"></a><a NAME="_Toc514731995"></a><a NAME="_Toc514732733"></a><a NAME="_Toc516456565"></a><a NAME="_Toc516460925"></a><a NAME="_Toc516463341"></a><a NAME="_Toc516560526"></a><a NAME="_Toc518363221"></a><a NAME="_Toc518466801"></a><a NAME="_Toc518733004"></a><a NAME="_Toc518733448"></a><a NAME="_Toc519520818"></a><a NAME="_Toc519700992"></a><a NAME="_Toc520104839"></a><a NAME="_Toc520108693"></a><a NAME="_Toc520261501"></a><a NAME="_Toc520609430"></a><a NAME="_Toc521132927"></a><a NAME="_Toc521304949"></a><a NAME="_Toc521330726"></a><a NAME="_Toc521426438"></a><a NAME="_Toc521468837"></a><a NAME="_Toc521492887"></a><a NAME="_Toc52
9701223"></a><a NAME="_Toc529706162"></a><a NAME="_Toc529947351"></a><a NAME="_Toc530205071"></a><a NAME="_Toc530215677"></a><a NAME="_Toc530801235"></a><a NAME="_Toc531699829"></a><a NAME="_Toc531774217"></a><a NAME="_Toc531805631"></a><a NAME="_Toc532024468">REPRESENTATIONS
AND WARRANTIES<br>
OF PARENT</a></p>
<p ALIGN="CENTER">&nbsp;</p>
<p>&nbsp;</p>
<p>Parent represents and warrants to Holdings and C&A Products, subject to
the exceptions set forth in the Disclosure Schedule (which exceptions shall
specifically identify a Section to which such exception relates, it being
understood and agreed that each such exception shall be deemed to be disclosed
both under such Section and any other Section to which such disclosure on its
face relates), that:</p>
<font COLOR="#ff0000">
<p>3.1 <a NAME="_Toc503342966"></a><a NAME="_Toc503343067"></a><a NAME="_Toc503343312"></a></font><a NAME="_Toc532024469"><u>Corporate
Organization, Qualification, Power and Authority</u>.</a></p>
<p>&nbsp;</p>
<p>(a) Parent and each of the Bison Subsidiaries is a corporation duly
organized, validly existing and in good standing (where applicable) under the
Laws of its jurisdiction of incorporation. Each of the Bison Subsidiaries is
qualified and in good standing (where applicable) as a foreign corporation in
each jurisdiction where the properties owned, leased or operated, or the
business conducted, by it requires such qualification, except where any failure
to be so qualified or be in good standing would not, individually or in the
aggregate, be reasonably likely to have a Material Adverse Effect. Each of the
Bison Subsidiaries has all requisite corporate power and corporate authority and
all necessary Permits to own, lease and operate its properties and to carry on
its business as it is now being conducted, except where any failure to have such
power and authority or Permits would not, individually or in the aggregate, be
reasonably likely to have a Material Adverse Effect. Parent has or will have
made available to Holdings prior to the Closing complete and correct copies of
the articles of organization or articles of or certificates of incorporation, as
the case may be, and by&#45;laws or other equivalent organizational
documents of it and each Bison Subsidiary as in effect as of the date hereof.</p>
<p>(b) Parent and its Subsidiaries have the requisite corporate power and
corporate authority to execute and deliver the Transaction Agreements (to the
extent each is a party thereto) and to consummate the transactions contemplated
thereby. The Transaction Agreements and the consummation by Parent and said
Subsidiaries of the transactions contemplated thereby have been duly and validly
authorized by the Boards of Directors of Parent and Textron Automotive Company
Inc., and the general partner of Textron Innovations L.P. (to the extent each is
a party thereto), and no other corporate proceeding on the part of Parent or its
Subsidiaries is necessary to authorize the Transaction Agreements or to
consummate the transactions contemplated thereby. On the Closing Date, Parent
and the Subsidiaries of Parent will have the requisite corporate power and
corporate authority to execute and deliver the Italian JV Documents and the
Leasing Documents (to the extent each is a party thereto). This Agreement has
been duly and validly executed and delivered by Parent and, assuming this
Agreement constitutes the valid and binding agreement of Holdings and C&A
Products, constitutes the valid and binding agreement of Parent, enforceable
against Parent in accordance with its terms, except as such enforcement may be
limited by (a) applicable bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium or other similar Laws now or hereinafter in effect
relating to or affecting creditors&#39; rights generally and (b) general
principles of equity (regardless of whether enforceability is considered in a
proceeding in equity or at law). When executed and delivered to Holdings and
C&A Products at the Closing, the Transaction Agreements (other than this
Agreement), the Italian JV Documents and the Leasing Documents will be duly and
validly executed and delivered by Parent and its Subsidiaries (to the extent
each is a party thereto) and, assuming such agreements constitute the valid and
binding agreements of the other parties thereto, constitute the valid and
binding agreements of Parent and its Subsidiaries (to the extent each is a party
thereto), enforceable against Parent and said Subsidiaries, in accordance with
their terms, except as such enforcement may be limited by (a) applicable
bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium or other
similar Laws now or hereinafter in effect relating to or affecting
creditors&#39; rights generally and (b) general principles of equity
(regardless of whether enforceability is considered in a proceeding in equity or
at law).</p>
<font COLOR="#ff0000">
<p>3.2 <a NAME="_Toc503342967"></a><a NAME="_Toc503343068"></a><a NAME="_Toc503343313"></a></font><u><a NAME="_Toc532024470">Stock
of Subsidiaries</a></p>
</u>
<p>.</p>
<p>(a) Schedule B to this Agreement identifies each entity that will be a
Subsidiary of the Directly Purchased Subsidiaries on the Closing Date. As of the
Closing Date, the Directly Purchased Subsidiaries will not own, directly or
indirectly, any equity interests in any other Person.</p>
<p>(b) All of the shares of capital stock of the Directly Purchased
Subsidiaries, except for any directors&#39; qualifying shares, are owned by
Parent or one or more of its Subsidiaries free and clear of all Liens (without
regard to subsections (i) through (iv) of the proviso in the definition of
&quot;Liens&quot;), and have been duly authorized, validly issued and are fully
paid and nonassessable and were not issued in violation of any preemptive or
similar rights. Except for any director&#39;s qualifying shares and except
as otherwise set forth on Schedule B, all of the shares of capital stock of the
Subsidiaries listed on Schedule B will, as of the Closing Date, be owned by one
or more of the other Bison Subsidiaries as set forth on Schedule B, free and
clear of all Liens (without regard to subsections (i) through (iv) of the
proviso in the definition of &quot;Liens&quot;), and said shares, together with
the outstanding common stock of Textron Automotive Exteriors Inc., have been
duly authorized, validly issued and are fully paid and nonassessable and were
not issued in violation of any preemptive or similar rights, except for any
Liens or where any failure to be duly authorized, validly issued and fully paid
or nonassessable would not, individually or in the aggregate, be reasonably
likely to have a Material Adverse Effect.</p>
<p>(c) There are no options, warrants, convertible securities or other rights,
agreements, arrangements or commitments relating to the capital stock of, or
other equity interest in, any Bison Subsidiary obligating Parent or any Bison
Subsidiary to issue, sell, transfer, vote or otherwise dispose of or sell any
shares of capital stock of, or other equity interest in, any Bison Subsidiary or
obligating Parent or any Bison Subsidiary to grant, extend or enter into any
such option, warrant, convertible security or other right, agreement,
arrangement or commitment. There are no voting trusts, proxies or other voting
agreements or understandings to which Parent or any of its Subsidiaries is a
party or by which it or they are bound with respect to the shares of capital
stock of any of the Bison Subsidiaries.</p>
<font COLOR="#ff0000">
<p>3.3 <a NAME="_Toc503342968"></a><a NAME="_Toc503343069"></a><a NAME="_Toc503343314"></a></font><u><a NAME="_Toc532024471">Consents
and Approvals; No Violations</a></p>
</u>
<p>.</p>
<p>(a) Except for (i) the filing of notification and report forms with the
United States Federal Trade Commission and the United States Department of
Justice under the Hart&#45;Scott&#45;Rodino Antitrust Improvements Act
of 1976 (the &quot;HSR Act&quot;) and the expiration or termination of any
applicable waiting period thereunder, (ii) the filing of the applications and
notices, as applicable, listed in Section 3.3(a)(ii) of the Disclosure Schedule
with foreign Governmental Authorities under the Foreign Competition Laws, the
issuance of consents, authorizations or approvals of such applications by such
authorities, if required, and the expiration or termination of any applicable
waiting periods thereunder, (iii) compliance with any applicable environmental
transfer statutes and (iv) the notices to or consultations with any works
council, personnel committee or similar employee council or committee listed in
Schedule 3.3(a)(iv) of the Disclosure Schedule, no material applications,
notices to, consultations with, Consents of, or filings with, any Government
Authority, self&#45;regulatory authority or third party are necessary in
connection with the execution and delivery by Parent and its Subsidiaries of the
Transaction Agreements (to the extent each is a party thereto) and the
consummation by Parent and its Subsidiaries of the transactions contemplated
thereby. The notices, notifications, filings, consents, authorizations,
approvals, and expirations or terminations of waiting periods referred in
clauses 3.3(a)(i) and 3.3(a)(ii) are hereinafter referred to as the
&quot;Requisite Regulatory Approvals.&quot;</p>
<p>(b) Neither the execution, delivery or performance of the Transaction
Agreements by Parent and its Subsidiaries nor the consummation by Parent and its
Subsidiaries of the transactions contemplated thereby does or will (i) conflict
with or result in any breach of any provisions of the certificate of
incorporation or by&#45;laws of Parent or the certificate of incorporation
or by&#45;laws or other equivalent organizational documents of any of its
Subsidiaries; (ii) conflict with, result in or constitute a Default under, any
of the terms, conditions or provisions of (A) any Contract to which Parent is a
party or by which it or any of its properties or assets may be bound and (B) any
Contract relating to the Business to which any of Parent&#39;s Subsidiaries
is a party or by which any of them or any of their respective properties or
assets may be bound; (iii) conflict with, result in or constitute a Default
under, any of the terms, conditions or provisions of any Permit relating to the
Business of Parent or any of its Subsidiaries; or (iv) subject to giving the
notices, the occurrence of the required consultations, compliance with
applicable environmental transfer statutes and obtaining the Requisite
Regulatory Approvals referred to in clauses (i) through (iv) in paragraph (a)
above, conflict with or violate any Order or Law applicable to (A) Parent or any
of its properties or assets or (B) any of Parent&#39;s Subsidiaries engaged
in the conduct of the Business or any of their properties or assets to the
extent used in the conduct of the Business, except, in the case of clauses (ii),
(iii) or (iv) of this paragraph (b) for conflicts or Defaults which would not,
individually or in the aggregate, be reasonably likely to have a Material
Adverse Effect.</p>
<font COLOR="#ff0000">
<p>3.4 <a NAME="_Toc503342969"></a><a NAME="_Toc503343070"></a><a NAME="_Toc503343315"></a></font><u><a NAME="_Toc532024472">Financial
Statements</a></p>
</u>
<p>. Parent has delivered to Holdings the following financial statements for the
Bison Subsidiaries (as adjusted to give effect to the Restructuring)
(collectively, the &quot;Financial Statements&quot;): a statement of net assets
to be sold as at December 30, 2000 and January 1, 2000 and statements of
earnings for each of the 12 months then ended. The December 30, 2000 statement
of net assets to be sold (the &quot;December 30, 2000 Statement of Net Assets to
be Sold&quot;) has been audited and was delivered together with a report of
E&Y thereon. Except as set forth in the notes to the Financial Statements or
Section 3.4 of the Disclosure Schedule, the Financial Statements have been
prepared in conformity with GAAP and present fairly in all material respects the
financial position of the Bison Subsidiaries (as adjusted to give effect to the
Restructuring) and their results of operations for the periods covered therein.</p>
<font COLOR="#ff0000">
<p>3.5 <a NAME="_Toc503342970"></a><a NAME="_Toc503343071"></a><a NAME="_Toc503343316"></a></font><u><a NAME="_Toc532024473">Absence
of Certain Changes or Events</a></p>
</u>
<p>. Except as a consequence of, or as expressly contemplated by, this
Agreement, since December 30, 2000 through and including the date hereof:</p>
<p>(a) the Business has been conducted in the ordinary course of business
consistent with past practice;</p>
<p>(b) the Business has not experienced any events, developments or changes
which, individually or in the aggregate, would be reasonably likely to have, or
have had, a Material Adverse Effect;</p>
<p>(c) except for the Restructuring and except in the ordinary course of
business consistent with past practice, neither Parent nor any of its
Subsidiaries has sold, transferred, conveyed, assigned or otherwise disposed of
any material assets or properties related to the Business;</p>
<p>(d) neither Parent nor any of its Subsidiaries has waived, released or
canceled any material claims against third parties or debts owing to it, or any
material rights which have any value and which relate to the Business, other
than in the ordinary course of business consistent with past practice pursuant
to Contracts which are not Material Contracts with Persons that are not
Affiliates of Parent;</p>
<p>(e) neither Parent nor any of its Subsidiaries has made any changes in their
accounting systems, policies, principles or practices related to the Business;</p>
<p>(f) none of the Bison Subsidiaries has authorized for issuance, issued, sold,
delivered or agreed or committed to issue, sell or deliver (whether through the
issuance or granting of options, warrants, convertible or exchangeable
securities, commitments, subscriptions, rights to purchase or otherwise) any
Shares or any of its other securities, or amended any of the terms of any shares
of its capital stock or such other securities;</p>
<p>(g) the Bison Subsidiaries have not made any loans, advances or capital
contributions to, or investments in, any Person other than a Subsidiary of
Parent;</p>
<p>(h) as of Closing, there will be no loans or advances outstanding between
Parent and the Non&#45;Bison Subsidiaries on the one hand, and the Bison
Subsidiaries on the other hand, and the Bison Subsidiaries will not have any
accounts payable to, or investments in, Parent or the Non&#45;Bison
Subsidiaries, other than accounts payable in connection with commercial
transactions in the ordinary course of business consistent with past practice;</p>
<p>(i) except in the ordinary course of business consistent with past practice
and except as set forth in Section 3.9(e) of the Disclosure Schedule, neither
Parent nor any of its Subsidiaries has increased in any manner the compensation
or fringe benefits of any employee of the Business or entered into any contract,
agreement, commitment or arrangement to do any of the foregoing;</p>
<p>(j) except in the ordinary course of business consistent with past practice,
neither Parent nor any of its Subsidiaries has, except in connection with the
Restructuring, acquired or leased any assets relating to the Business, or made
any material amount of property of the Business, subject to any Lien whatsoever;</p>
<p>(k) as of Closing, no assets or property owned or leased by the Bison
Subsidiaries or used in the Business will be subject to any Lien securing
Balance Sheet Indebtedness;</p>
<p>(l) there have been no capital expenditures with respect to the Business
which, in the aggregate, are in excess of one hundred fifteen million dollars
($115,000,000), except for capital expenditures not exceeding fifty&#45;five
million dollars ($55,000,000) in support of sales to Fiat by Textron Automotive
Company Italia S.r.l.;</p>
<p>(m) neither Parent nor any of its Subsidiaries has made any material Tax
election or settled or compromised any material domestic or foreign federal,
national, state, provincial, county, municipal or local Tax liability, or waived
or extended the statute of limitations in respect of any such Taxes in each case
with respect to the Business; and</p>
<p>(n) neither Parent nor any of its Subsidiaries has paid any amount, performed
any obligation or agreed to pay any amount or perform any obligation, in
settlement or compromise of any suits or claims of liability with respect to the
Business or any of the officers, members, managers, employees or agents of the
Bison Subsidiaries in excess of $5,000,000.</p>
<font COLOR="#ff0000">
<p>3.6 <a NAME="_Toc503342971"></a><a NAME="_Toc503343072"></a><a NAME="_Toc503343317"></a></font><u><a NAME="_Toc532024474">No
Undisclosed Liabilities</a></p>
</u>
<p>. As of the date hereof, except to the extent of the amounts specifically
reflected or reserved in the December 30, 2000 Statement of Net Assets to be
Sold and except for liabilities and obligations incurred in the ordinary course
of business, since December 30, 2000, (a) none of the Bison Subsidiaries has any
liabilities or obligations of any nature (whether accrued, absolute, contingent
or otherwise) required by GAAP to be recognized or disclosed on a statement of
net assets to be sold of the Bison Subsidiaries, as adjusted to give effect to
the Restructuring, or in the notes thereto, except for liabilities or
obligations which would not, individually or in the aggregate, be reasonably
likely to have a Material Adverse Effect and (b) to the knowledge of the persons
identified in Section 3.6 of the Disclosure Schedule, none of the Bison
Subsidiaries has any liability or obligation of any nature (whether accrued,
absolute, contingent or otherwise) except for liabilities or obligations which
would not, individually or in the aggregate, be reasonably likely to have a
Material Adverse Effect.</p>
<font COLOR="#ff0000">
<p>3.7 <a NAME="_Toc503342972"></a><a NAME="_Toc503343073"></a><a NAME="_Toc503343318"></a></font><u><a NAME="_Toc532024475">Litigation</a></p>
</u>
<p>. As of the date hereof, there are no Litigations pending, or to
Parent&#39;s knowledge, threatened against Parent or any of its Subsidiaries
with respect to the Business, the outcomes of which, individually or in the
aggregate, are reasonably likely to have a Material Adverse Effect.</p>
<font COLOR="#ff0000">
<p>3.8 <a NAME="_Toc503342973"></a><a NAME="_Toc503343074"></a><a NAME="_Toc503343319"></a></font><u><a NAME="_Toc532024476">Taxes</a></p>
</u>
<p>.</p>
<p>(a) <u>Tax Returns Filed and Taxes Paid</u>. Each of the Bison Subsidiaries
has filed or had filed on its behalf all material Tax Returns that it was
required to file or have filed on its behalf on or before the date of this
Agreement, and all such Tax Returns were correct and complete in all material
respects. Each of the Bison Subsidiaries has paid all material Taxes due or
owing. Each of Plascar Participacoes Industriais S.A. (&quot;Plascar&quot;) and
Textron Automotive Trim Brasil Ltda. (&quot;TATB&quot;) has made adequate
provision for the payment of all material Taxes not yet due.</p>
<p>(b) <u>Tax Positions</u>. No position has been asserted in writing by any Tax
Authority with respect to Taxes of any of the Bison Subsidiaries which, if
asserted by such Tax Authority in a Tax period ending after the Closing Date,
would be reasonably likely to have a Material Adverse Effect.</p>
<p>(c) <u>No Affiliated Group Liability</u>. No liability has been asserted
against any of the Bison Subsidiaries with respect to Taxes of any affiliated
group within the meaning of Section 1504(a) of the Code of which any of the
Bison Subsidiaries has been a member and of which Parent was not the common
parent corporation.</p>
<p>(d) <u>No Tax Indemnities</u>. No liability has been asserted against any of
the Bison Subsidiaries with respect to Taxes of any other Person pursuant to any
Tax allocation or sharing agreement with any such Person, or any agreement to
indemnify any such Person with respect to Taxes.</p>
<font COLOR="#ff0000">
<p>3.9 </font><u><a NAME="_Toc532024477">Employee Benefit Plans and Agreements</a></p>
</u>
<p>.</p>
<p>(a) A &quot;Bison Plan&quot; shall mean any (i) &quot;welfare&quot; plan,
fund or program (within the meaning of Section 3(1) of the Employee Retirement
Income Security Act of 1974, as amended (&quot;ERISA&quot;)) and any comparable
foreign plan; (ii) &quot;pension&quot; plan, fund or program (within the meaning
of Section 3(2) of ERISA) and any comparable foreign plan; (iii) deferred
compensation plan or incentive compensation plan; (iv) employment, termination
or severance agreement with any officer of a Directly Purchased Subsidiary whose
principal office is located in the United States other than officers who are
employed by a Non&#45;Bison Subsidiary; (v) stock bonus, stock option,
restricted stock, stock appreciation right, stock purchase, bonus, severance or
vacation plans; and (vi) any other material employee benefit plans, funds or
programs, in each case, that are sponsored or maintained by or contributed to or
required to be contributed to by a Bison Subsidiary or by any trade or business,
whether or not incorporated (an &quot;ERISA Affiliate&quot;), that together with
a Bison Subsidiary would be deemed a &quot;single employer&quot; within the
meaning of Section 4001(b) of ERISA or to which a Bison Subsidiary or an ERISA
Affiliate is party, for the benefit of any employee or former employee of a
Bison Subsidiary (or of Textron Automotive Company Inc. if such person&#39;s
entire salary was directly charged to the Business), or with respect to which a
Bison Subsidiary could incur liability and any comparable foreign plan. Section
3.9 of the Disclosure Schedule lists each material Bison Plan applicable to any
Bison Subsidiary having its jurisdiction of organization within the United
States and all foreign pension plans. A copy of each material Bison Plan (and,
if applicable, related amendments, trust agreements, current summary plan
descriptions, most recent Form 5500, most recent Internal Revenue Service
determination letter and most recent actuarial report) applicable solely to any
Bison Subsidiary having its jurisdiction of organization within the United
States has been made available to Holdings, and a copy of each material Bison
Plan from which assets will be transferred from Parent to C&A Products
pursuant to Section 5.7 will be made available to Holdings prior to Closing.</p>
<p>(b) No liability under Title IV or Section 302 of ERISA has been incurred by
any Bison Subsidiary or any ERISA Affiliate that has not been satisfied in full,
and, to Parent&#39;s knowledge, no condition exists that presents a material
risk to a Bison Subsidiary of incurring any such liability, other than liability
for premiums due the Pension Benefit Guaranty Corporation (which premiums have
been paid when due).</p>
<p>(c) Each Bison Plan (other than a Foreign Plan) has been operated and
administered in accordance with its terms and with the requirements (including
funding requirements) of applicable Law, including ERISA and the Code, except
where any failure to be so operated and administered would not, individually or
in the aggregate, be reasonably likely to have a Material Adverse Effect. All
material contributions required to be made under the terms of any Bison Plan
(other than a Foreign Plan) as of the Closing Date have been made or will be
timely made on or prior to the Closing Date. With respect to any Bison Plan
subject to Section&#160;412 of the Code or Section&#160;302 of ERISA,
there has been no application for or waiver of the minimum funding standards
imposed by Section&#160;412 of the Code, and no such plan has incurred an
&quot;accumulated funding deficiency&quot; within the meaning of
Section&#160;412(a) of the Code as of the end of the most recently completed
plan year.</p>
<p>(d) Each Bison Plan intended to be &quot;qualified&quot; within the meaning
of Section 401(a) of the Code has received a determination letter from the
Internal Revenue Service stating that it is so qualified, and no event has
occurred since the date of such determination that would adversely affect such
determination or result in the imposition of any material liability, penalty or
tax under ERISA or the Code.</p>
<p>(e) The consummation of the Transactions will not (i) entitle any employee of
any Bison Subsidiary to severance pay payable by a Bison Subsidiary, (ii)
accelerate the time of payment or vesting or trigger any payment of compensation
or benefits under, increase the amount payable or trigger any other material
obligation pursuant to, any of the Bison Plans, (iii) result in any material
Default under, any of the Bison Plans or (iv) result in or satisfy a condition
to the payment of compensation that would, in combination with any other
payment, result in an &quot;excess parachute payment&quot; with respect to any
Employee within the meaning of Section 280G(b) of the Code.</p>
<p>(f) With respect to any Bison Plan subject to Title IV of ERISA, there is not
any amount of &quot;unfunded benefit liabilities&quot; (as defined in Section
4001(a)(18) of ERISA) under such plan, and the Parent is not aware of any facts
or circumstances that would materially change the funded status of any such
plan.</p>
<p>(g) No Bison Subsidiary or any ERISA Affiliate has liability (including any
contingent liability under Section 4204 of ERISA) with respect to any
multiemployer plan, within the meaning of Section 3(37) of ERISA.</p>
<p>(h) There are (i) to Parent&#39;s knowledge, no investigations pending by
any governmental entity (including the Pension Benefit Guaranty Corporation)
involving Bison Plans, and (ii) no pending or, to Parent&#39;s knowledge,
threatened claims (other than routine claims for benefits), suits or proceedings
against any Bison Plans, or against any fiduciary of any Bison Plan which would,
individually or in the aggregate, be reasonably likely to have a Material
Adverse Effect.</p>
<p>(i) None of the Bison Subsidiaries or any employee of the foregoing, nor any
trustee or administrator with respect to the Bison Plans, has engaged in a
&quot;prohibited transaction&quot; (as such term is defined in Section 4975 of
the Code or Section 406 of ERISA) that could result in a tax or penalty under
Section 4975 of the Code or Section 502(i) of ERISA which would, individually or
in the aggregate, be reasonably likely to have a Material Adverse Effect.</p>
<p>(j) Since January 1, 2000, the Bison Subsidiaries, and any ERISA Affiliates
which maintain a &quot;group health plan&quot; within the meaning of Section
5000(b)(1) of the Code have complied in all material respects with the
&quot;COBRA&quot; notice and continuation requirements.</p>
<p>(k) Except as would not, individually or in the aggregate, be reasonably
likely to have a Material Adverse Effect, each Bison Plan subject to ERISA that
is an employee pension benefit plan and is not qualified under Section 401(a) of
the Code is exempt from Part 2, 3 and 4 of Title I of ERISA as an unfunded plan
that is maintained primarily for the purpose of providing deferred compensation
for a select group of management or highly compensated employees, pursuant to
Sections 201(2), 301(a)(3) and 401(a)(1) of ERISA.</p>
<p>(l) Each Foreign Plan has been operated and administered in accordance with
its terms and with the requirements of applicable Law, except where any failure
to be so operated and administered would not, individually or in the aggregate,
be reasonably likely to have a Material Adverse Effect. All material
contributions required to be made under the terms of any Foreign Plan as of the
Closing Date have been made or will be timely made on or prior to the Closing
Date, and no Bison Subsidiary has incurred any unpaid obligation in connection
with the termination or withdrawal from any Foreign Plan. With respect to any
unfunded retirement plan which is a Foreign Plan for which GAAP or applicable
Law requires that reserves be recorded on a statement of financial position,
reserves have been recorded on the December 30, 2000 Statement of Net Assets to
be Sold in a manner which is consistent with GAAP and applicable Law. With
respect to funded retirement plans which are Foreign Plans, the plans have been
funded in accordance with applicable Law. Copies of the most recent actuarial
valuation reports or FAS 87 reports for Foreign Plans, to the extent that they
exist, have been made available to Holdings. There are no actions, suits or
claims (other than routine claims for benefits) pending or threatened with
respect to any Foreign Plan that would, individually, or in the aggregate, be
reasonably likely to result in a Material Adverse Effect. For purposes hereof,
the term &quot;Foreign Plan&quot; shall mean any Bison Plan maintained or
contributed to primarily for the benefit of any employee or former employee of a
Bison Subsidiary employed outside the United States.</p>
<p>(m) Notwithstanding any other provision of this Agreement, Section 3.4 and
this Section 3.9 set forth the sole representations and warranties in Article
III of this Agreement with respect to the compliance by Parent and any Bison
Subsidiary with ERISA, sections of the Code and any other Law applicable to the
operation or administration of any Bison Plan.</p>
<font COLOR="#ff0000">
<p>3.10 <a NAME="_Toc503342975"></a><a NAME="_Toc503343076"></a><a NAME="_Toc503343321"></a></font><u><a NAME="_Toc532024478">Labor
Matters</a></p>
</u>
<p>.</p>
<p>(a) Since January 1, 1999, except as will not, individually or in the
aggregate, be reasonably likely to have a Material Adverse Effect, (i) none of
the Bison Subsidiaries has or is now engaged in any unfair labor practice, nor
is any complaint against any Bison Subsidiary pending or, to Parent&#39;s
knowledge, threatened before the National Labor Relations Board; (ii) there is
no labor strike, dispute, slowdown or stoppage pending or, to Parent&#39;s
knowledge, threatened with respect to any employees of any Bison Subsidiary; and
(iii) no grievance is pending arising out of any collective bargaining agreement
or in accordance with any Bison Subsidiaries&#39; established procedures for
handling grievances.</p>
<p>(b) The Bison Subsidiaries are in compliance in all material respects with
their obligations pursuant to the Worker Adjustment and Retraining Notification
Act of 1988 (the &quot;WARN Act&quot;). Since January 1, 1999 through and
including the date hereof, none of the Bison Subsidiaries has effectuated (i) a
&quot;mass layoff&quot; (as defined in the WARN Act) in the United States
affecting any site of employment or facility or operating unit within any site
of employment or facility of any Bison Subsidiary or (ii) a &quot;plant
closing&quot; (as defined in the WARN Act) in the United States affecting any
Bison Subsidiary site of employment or facility. Since January 1, 1999 through
and including the date hereof, no Bison Subsidiary has been affected by any
transaction or engaged in lay&#45;offs or employment terminations sufficient
in number to trigger the application of any Law similar to the WARN Act.</p>
<p>(c) Section 3.10(c) of the Disclosure Schedule lists each collective
bargaining agreement involving a Bison Subsidiary facility located in the United
States or Canada.</p>
<p><a NAME="_Toc503342976"></a><a NAME="_Toc503343077"></a><a NAME="_Toc503343322"></p>
<font COLOR="#ff0000">
<p>3.11 </font></a><a NAME="_Toc532024479"><u>Environmental Laws and Regulations</u></a></p>
<p>. To the knowledge of the individuals identified in Section 3.11 of the
Disclosure Schedule and except as would not, individually or in the aggregate,
be reasonably likely to have, and have not had, a Material Adverse Effect:</p>
<p>(a) As of the date hereof, each of Parent and its Subsidiaries with respect
to the Business is in compliance with all applicable Environmental Laws,
including possessing all Permits required for the operation of the Business
under applicable Environmental Laws. Notwithstanding any other provision of this
Agreement, this Section 3.11(a) sets forth the sole representation and warranty
in Article III of this Agreement with respect to the compliance by Parent and
its Subsidiaries with any Environmental Law applicable to the Business.</p>
<p>(b) As of the date hereof, there is no pending or threatened Litigation
against Parent or any of its Subsidiaries with respect to the Business, and no
events have occurred or matters exist that might reasonably be expected to
result in Litigation, under or pursuant to any Environmental Law; <u>provided</u>,
<u>however</u>, that the representation made in this Section 3.11(b) with
respect to pending Litigation and Orders are made without reference to
knowledge. As of the date hereof, neither Parent nor any of its Subsidiaries is
subject to any Order with respect to the Business in connection with any
Environmental Law. This Section 3.11(b) sets forth the sole representation and
warranty in Article III of this Agreement with respect to Litigation under or
pursuant to any Environmental Law.</p>
<p><a NAME="_Toc503342977"></a><a NAME="_Toc503343078"></a><a NAME="_Toc503343323"></p>
<font COLOR="#ff0000">
<p>3.12 </font></a><a NAME="_Toc532024480"><u>Compliance with Laws</u></a></p>
<p>. Each of Parent and its Subsidiaries is in compliance with all applicable
Laws, Orders and Permits with respect to the Business, except for instances of
noncompliance which, individually or in the aggregate, would not be reasonably
likely to have, and have not had, a Material Adverse Effect.</p>
<font COLOR="#ff0000">
<p>3.13 </font><u><a NAME="_Toc532024481">Properties</a></p>
</u>
<p>. Except as would not be reasonably likely to have a Material Adverse Effect,
Parent or its Subsidiaries, collectively, have good and marketable title, free
and clear of all Liens, to all of the real property and personal property used
in the conduct of the Business other than (i) Intellectual Property (which is
covered in Section 3.15), (ii) assets not used within the Business and (iii)
assets which are leased or licensed, with respect to which the Parent or its
Subsidiaries, collectively, have valid and enforceable Contracts under which
there exists no Default by Parent or its Subsidiaries.</p>
<p><a NAME="_Toc503342978"></a><a NAME="_Toc503343079"></a><a NAME="_Toc503343324"></p>
<font COLOR="#ff0000">
<p>3.14 </font></a><a NAME="_Toc532024482"><u>Material Contracts</u></a></p>
<p>.</p>
<p>(a) Each Contract applicable to the Business is (i) in full force and effect
and is a valid and binding obligation of Parent or its Subsidiaries and (ii)
enforceable in accordance with its terms (except that the enforcement thereof
may be limited by (A) bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium or other similar Laws now or hereafter in effect
relating to creditors&#39; rights generally and (B) general principles of
equity, regardless of whether enforceability is considered in a proceeding in
equity or at law), except, in each case, as would not be reasonably likely to
have a Material Adverse Effect. The execution and delivery by Parent of the
Transaction Agreements and the consummation by Parent of the transactions
contemplated thereby will not, and no condition exists or event has occurred
which would, constitute a Default by Parent or its Subsidiaries of any Contract
applicable to the Business, except for such Defaults as would not, individually
or in the aggregate, be reasonably likely to have a Material Adverse Effect.</p>
<p>(b) Section 3.14(b) of the Disclosure Schedule lists all Material Contracts
involving the licensing of any Intellectual Property, including any Intellectual
Property which is the subject of any of the License Agreements attached hereto
as Exhibits 3A, 3B and 3C, from any third party and any Material Contract
involving the licensing of any such Intellectual Property by Parent or its
Subsidiaries to any third party, other than Contracts entered into in the
ordinary course of business consistent with past practice. A &quot;Material
Contract&quot; shall mean any contract which is material to the Business.</p>
<p>(c) Neither Parent nor any of its Subsidiaries is a party to or bound by any
non&#45;competition agreement or similar agreement or obligation which
purports to limit in any material respect the manner in which, or the localities
in which, all or any material portion of the Business is conducted.</p>
<p>(d) Section 3.14(d) of the Disclosure Schedule identifies each Contract to
which a Bison Subsidiary is a party relating to indebtedness for borrowed money
or capital leases, in each case, involving an obligation which exceeds $250,000.
Copies of any written Contract relating to said indebtedness will be provided to
Holdings prior to Closing.</p>
<font COLOR="#ff0000">
<p>3.15 <a NAME="_Toc503342979"></a><a NAME="_Toc503343080"></a><a NAME="_Toc503343325"></a></font><u><a NAME="_Toc532024483">Intellectual
Property</a></p>
</u>
<p>.</p>
<p>(a) Except as would not be reasonably likely to have a Material Adverse
Effect:</p>
<blockquote>
  <blockquote>
    <p>(i) Parent and its Subsidiaries, collectively, own, or are licensed or
    otherwise possess legally enforceable rights to use the Intellectual
    Property.</p>
    <p>(ii) Neither Parent nor any of its Subsidiaries is, nor will, as a result
    of the execution and delivery of the Transaction Agreements or the
    performance by Parent of any of its obligations thereunder, be in breach of
    any license, sublicense or other agreement relating to the Intellectual
    Property.</p>
    <p>(iii) (A) Each patent, trademark, service mark and copyright owned by
    either Parent or its Subsidiaries which is used in the Business as currently
    conducted is subsisting and, to Parent&#39;s knowledge, valid and
    enforceable; (B) neither Parent nor its Subsidiaries, as of the date hereof,
    is a party to any currently pending Litigation which involves a claim of
    infringement of any patent, trademark, service mark or copyright or
    violation of any trade secret or other proprietary right of any third party,
    or has received written notice of any such threatened claim; (C) to
    Parent&#39;s knowledge, the manufacturing, marketing, licensing or sale
    of any products of the Business, taken as a whole, in the manner currently
    manufactured, marketed, sold or licensed by the Business, does not infringe
    any patent, trademark, service mark, copyright, trade secret or other
    proprietary right of any third party.</p>
    <font FACE="Courier New">
    </blockquote>
  </blockquote>
</font>
<p>(b) After the Closing Date, the Bison Subsidiaries will have the right to use
all Intellectual Property material to the Business (i) which is used in the
Business as of the date hereof or (ii) which the Bison Subsidiaries have the
right to use in the Business as of the date hereof, in each case to the extent
that such Intellectual Property is held by the Bison Subsidiaries from Parent or
the Non&#45;Bison Subsidiaries and in each case solely to the extent of the
Bison Subsidiaries&#39; rights of use in such Intellectual Property as of
the date hereof; <u>provided</u>, <u>however</u>, that the foregoing
representation and warranty shall not apply with respect to the Retained IP (at
that term is defined in the Retained IP Agreement), the rights to which are
exclusively as set forth in the Retained IP Agreement.</p>
<font COLOR="#ff0000">
<p>3.16 </font><u><a NAME="_Toc532024484">Product Warranties; Recalls</a></p>
</u>
<p>.</p>
<p>(a) Since January 1, 1999 through and including the date hereof, there have
been no warranty claims with respect to products sold by the Business, except
for such warranty claims which would not, individually or in the aggregate, be
reasonably likely to have a Material Adverse Effect, nor, as of the date hereof,
are there any pending warranty claims with respect to products sold by the
Business, except for such warranty claims which would not, individually or in
the aggregate, be reasonably likely to have a Material Adverse Effect.</p>
<p>(b) Since January 1, 1999 through and including the date hereof, there have
been no product recalls, retrofits, field campaigns or service campaigns by a
Governmental Authority with respect to the products manufactured, distributed or
sold by the Business; and no such recalls, retrofits, field campaigns or service
campaigns are pending or, to Parent&#39;s knowledge, threatened by any
Governmental Authority.</p>
<font COLOR="#ff0000">
<p>3.17 <a NAME="_Toc503342980"></a><a NAME="_Toc503343081"></a><a NAME="_Toc503343326"></a></font><u><a NAME="_Toc532024485">Brokers
and Finders</a></p>
</u>
<p>. Parent has not employed any investment banker, broker, finder, consultant
or intermediary in connection with the transactions contemplated by this
Agreement which would be entitled to any investment banking, brokerage,
finder&#39;s, financial advisory or similar fee or commission from any Bison
Subsidiary in connection with this Agreement or the transactions contemplated
hereby.</p>
<font COLOR="#ff0000">
<p>3.18 </font><u><a NAME="_Toc532024486">Customers and Suppliers</a></p>
</u>
<p>. Since January 1, 2001 through and including the date hereof, none of the
top five customers of or top ten suppliers to the Business, measured by dollar
volume for the twelve months ended as of December 31, 2000, has (i) notified any
senior executive of Textron Automotive Company Inc. that it intends to
discontinue its relationship with the Bison Subsidiaries or the Business or (ii)
materially changed the terms on which it is prepared to purchase from, trade
with or supply the Bison Subsidiaries or the Business.</p>
<font COLOR="#ff0000">
<p>3.19 </font><u><a NAME="_Toc532024487">Additional Representations and
Warranties by Parent</a></p>
</u>
<p>.</p>
<p>(a) Parent hereby acknowledges that Holdings intends to offer and issue the
Holdings Common Stock and C&A Products intends to offer and issue the
Preferred Stock (collectively, the &quot;Equity Consideration&quot;)
representing a portion of the purchase price relating to parts of the
Transactions to Parent in a transaction which is exempt from registration under
the Securities Act and applicable state securities laws.</p>
<p>(b) Parent hereby represents and warrants that: (i) it is an &quot;accredited
investor&quot; within the meaning of Regulation D under the Securities Act; (ii)
it shall acquire the Equity Consideration for its own account and not with a
view to or for sale in connection with any &quot;sale&quot;, &quot;offer for
sale&quot;, &quot;offer to sell&quot;, &quot;offer&quot; or
&quot;distribution&quot; thereof within the meaning of the Securities Act; (iii)
it has sufficient knowledge and experience in financial, tax, and business
matters to enable it to evaluate the merits and risks of investment in the
Equity Consideration; and (iv) it has been provided with access to, and the
opportunity to ask questions of, management of Holdings and C&A Products,
and to obtain additional information concerning Holdings and C&A Products.</p>
<p>(c) Parent hereby acknowledges that: (i) the Equity Consideration is not,
and, subject to the Registration Rights Agreements attached as Exhibits 5 and 6
hereof, will not be, registered under the Securities Act or any state securities
laws and cannot be resold without registration thereunder or exemption
therefrom; and (ii) the certificates representing the unregistered Equity
Consideration to be delivered at the Closing shall bear substantially the
following legend:</p>
<blockquote>
  <blockquote>
    <blockquote>
      <blockquote>
        <p>&quot;The shares represented by this certificate have not been
        registered under the Securities Act of 1933, as amended, and may not be
        sold, transferred or otherwise disposed of in the absence of an
        effective registration statement under such Act or an opinion of counsel
        satisfactory to the company to the effect that such registration is not
        required.&quot;</p>
      </blockquote>
    </blockquote>
  </blockquote>
</blockquote>
<font COLOR="#ff0000">
<p>3.20 </font><u><a NAME="_Toc532024488">Indebtedness</a></p>
</u>
<p>. Section 3.20 of the Disclosure Schedule lists total Indebtedness of the
Bison Subsidiaries (after giving effect to the Restructuring and excluding
intercompany accounts that will be settled prior to Closing), separated into the
categories &quot;a&quot; through &quot;g&quot; contained in the definition of
Indebtedness, as of June 29, 2001.</p>
<font COLOR="#ff0000">
<p>3.21 </font><a NAME="_Toc532024489"><u>R&D People</u>.</a></p>
<p>To the best knowledge of the persons identified in Section 3.21 of the
Disclosure Schedule, without inquiry, no material amount of people whose
activities as of March 31, 2001 related primarily to research and development
and product development related to the Business have been, as of the date of
this Agreement, transferred to a Non&#45;Bison Subsidiary.</p>
<font COLOR="#ff0000">
<p ALIGN="CENTER">ARTICLE IV<a NAME="_Toc503343082"></a><a NAME="_Toc503343327"></a></font><br>
<br>
<a NAME="_Toc503342981"></a><a NAME="_Toc503343931"></a><a NAME="_Toc503667914"></a><a NAME="_Toc503684845"></a><a NAME="_Toc504459536"></a><a NAME="_Toc505070799"></a><a NAME="_Toc505137395"></a><a NAME="_Toc505767641"></a><a NAME="_Toc506346212"></a><a NAME="_Toc506628530"></a><a NAME="_Toc506775340"></a><a NAME="_Toc507592206"></a><a NAME="_Toc508437279"></a><a NAME="_Toc508709227"></a><a NAME="_Toc514732013"></a><a NAME="_Toc514732751"></a><a NAME="_Toc516456583"></a><a NAME="_Toc516460943"></a><a NAME="_Toc516463359"></a><a NAME="_Toc516560544"></a><a NAME="_Toc518363241"></a><a NAME="_Toc518466822"></a><a NAME="_Toc518733025"></a><a NAME="_Toc518733469"></a><a NAME="_Toc519520839"></a><a NAME="_Toc519701013"></a><a NAME="_Toc520104860"></a><a NAME="_Toc520108714"></a><a NAME="_Toc520261522"></a><a NAME="_Toc520609451"></a><a NAME="_Toc521132948"></a><a NAME="_Toc521304970"></a><a NAME="_Toc521330747"></a><a NAME="_Toc521426459"></a><a NAME="_Toc521468858"></a><a NAME="_Toc521492909"></a><a NAME="_Toc52
9701245"></a><a NAME="_Toc529706184"></a><a NAME="_Toc529947373"></a><a NAME="_Toc530205093"></a><a NAME="_Toc530215699"></a><a NAME="_Toc530801257"></a><a NAME="_Toc531699851"></a><a NAME="_Toc531774239"></a><a NAME="_Toc531805653"></a><a NAME="_Toc532024490">REPRESENTATIONS
AND WARRANTIES OF HOLDINGS</a> AND C&A PRODUCTS</p>
<p ALIGN="CENTER">&nbsp;</p>
<p>&nbsp;</p>
<p>Holdings and C&A Products jointly and severally represent and warrant to
Parent, subject to the exceptions set forth in the Holdings Disclosure Schedule
(which exceptions shall specifically identify a Section to which such exception
relates, it being understood and agreed that each such exception shall be deemed
to be disclosed both under such Section and any other Section to which such
disclosure on its face relates), that:</p>
<p>4.1 <a NAME="_Toc503342982"></a><a NAME="_Toc503343083"></a><a NAME="_Toc503343328"></a><a NAME="_Toc532024491"><u>Corporate
Organization, Qualification, Power and Authority</u>.</a></p>
<p>(a) Holdings is a corporation duly organized, validly existing and in good
standing under the Laws of the State of Delaware. Holdings is qualified and in
good standing as a foreign corporation in each jurisdiction where the properties
owned, leased or operated, or the business conducted, by it requires such
qualification, except where any failure to be so qualified or be in good
standing would not, individually or in the aggregate, be reasonably likely to
have a Holdings Material Adverse Effect. Holdings has all requisite corporate
power and corporate authority and all necessary Permits to own, lease and
operate its properties and to carry on its business as it is now being
conducted, except where any failure to have such power and authority or Permits
would not, individually or in the aggregate, be reasonably likely to have a
Holdings Material Adverse Effect. Holdings has or will have made available to
Parent prior to the Closing complete and correct copies of its certificate of
incorporation and by&#45;laws as in effect as of the date hereof.</p>
<p>(b) C&A Products is a corporation duly organized, validly existing and in
good standing under the Laws of the State of Delaware. C&A Products is
qualified and in good standing as a foreign corporation in each jurisdiction
where the properties owned, leased or operated, or the business conducted, by it
requires such qualification, except where any failure to be so qualified or be
in good standing would not, individually or in the aggregate, be reasonably
likely to have a Holdings Material Adverse Effect. C&A Products has all
requisite corporate power and corporate authority and all necessary Permits to
own, lease and operate its properties and to carry on its business as it is now
being conducted, except where any failure to have such power and authority or
Permits would not, individually or in the aggregate, be reasonably likely to
have a Holdings Material Adverse Effect. C&A Products has or will have made
available to Parent prior to the Closing complete and correct copies of its
certificate of incorporation and by&#45;laws as in effect as of the date
hereof.</p>
<p>(c) Holdings has the requisite corporate power and corporate authority to
execute and deliver the Transaction Agreements (to the extent it is party
thereto) and to consummate the transactions contemplated thereby. Such
Transaction Agreements and the consummation by Holdings of the transactions
contemplated thereby have been duly and validly authorized by the Board of
Directors of Holdings, and no other corporate proceedings on the part of
Holdings are necessary to authorize such Transaction Agreements or to consummate
the transactions contemplated thereby, except for such proceedings relating to
approval of the definitive Financing Agreements, which such proceedings will be
completed prior to Closing. On the Closing Date, Holdings and the Subsidiaries
of Holdings will have the requisite corporate power and corporate authority to
execute and deliver the Italian JV Documents and the Leasing Documents (to the
extent each is a party thereto.) This Agreement has been duly and validly
executed and delivered by Holdings and, assuming this Agreement constitutes the
valid and binding agreement of Parent, constitutes the valid and binding
agreement of Holdings, enforceable against Holdings in accordance with its
terms, except as such enforcement may be limited by (a) applicable bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium or other similar
Laws now or hereafter in effect relating to or affecting creditors&#39;
rights generally and (b) general principles of equity (regardless of whether
enforceability is considered in a proceeding in equity or at law). When executed
and delivered to Parent at the Closing, the Transaction Agreements (other than
this Agreement), the Italian JV Document and the Leasing Document will be duly
and validly executed and delivered by Holdings and its Subsidiaries (to the
extent each is a party thereto) and, assuming such agreements constitute the
valid and binding agreements of the other parties thereto, constitute the valid
and binding agreements of Holdings and its Subsidiaries (to the extent each is a
party thereto), enforceable against Holdings and said Subsidiaries in accordance
with their terms, except that the enforcement thereof may be limited by (a)
applicable bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium or other similar Laws now or hereafter in effect relating to or
affecting creditors&#39; rights generally and (b) general principles of
equity (regardless of whether enforceability is considered in a proceeding in
equity or at law).</p>
<p>(d) C&A Products and its Subsidiaries have the requisite corporate power
and corporate authority to execute and deliver the Transaction Agreements (to
the extent each is a party thereto) and to consummate the transactions
contemplated thereby. Such Transaction Agreements and the consummation by
C&A Products and said Subsidiaries of the transactions contemplated thereby
have been duly and validly authorized by the Board of Directors of C&A
Products, and no other corporate proceedings on the part of C&A Products and
said Subsidiaries are necessary to authorize such Transaction Agreements or to
consummate the transactions contemplated thereby, except for such proceedings
relating to approval of the definitive Financing Agreements, which such
proceedings will be completed prior to Closing. On the Closing Date, C&A
Products and the Subsidiaries of C & A Products will have the requisite
corporate powers and corporate authority to execute and deliver the Italian JV
Documents, the guarantee required by Exhibit 12 and the Leasing Documents (to
the extent each is a party thereto). This Agreement has been duly and validly
executed and delivered by C&A Products and, assuming this Agreement
constitutes the valid and binding agreement of Parent, constitutes the valid and
binding agreement of C&A Products, enforceable against C&A Products in
accordance with its terms, except such enforcement may be limited by (a)
applicable bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium or other similar Laws now or hereafter in effect relating to or
affecting creditors&#39; rights generally and (b) general principles of
equity (regardless of whether enforceability is considered in a proceeding in
equity or at law). When executed and delivered to Parent at the Closing, the
Transaction Agreements (other than this Agreement), the Italian JV Documents,
the guarantee required by Exhibit 12 and the Leasing Documents will be duly and
validly executed and delivered by C&A Products and its Subsidiaries (to the
extent each is a party thereto) and, assuming such agreements will constitute
the valid and binding agreements of the other parties thereto, constitute the
valid and binding agreements of C&A Products and its Subsidiaries (to the
extent each is a party thereto), enforceable against it in accordance with their
terms, except that the enforcement thereof may be limited by (a) applicable
bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium or other
similar Laws now or hereafter in effect relating to or affecting
creditors&#39; rights generally and (b) general principles of equity
(regardless of whether enforceability is considered in a proceeding in equity or
at law).</p>
<font COLOR="#ff0000">
<p>4.2 </font><u><a NAME="_Toc532024492">Capitalization of Holdings and C&A
Products</a></p>
</u>
<p>.</p>
<p>(a) The authorized capital stock of Holdings consists of (i) 300,000,000
shares of Holdings Common Stock of which, as of July 31, 2001, 105,122,130
shares were issued and outstanding, all of which are duly authorized, validly
issued, fully paid and nonassessable and were not issued in violation of any
preemptive or similar rights and (ii) 16,000,000 shares of preferred stock, par
value $.01 per share, none of which are issued and outstanding. Additional
shares of Holdings preferred stock may be authorized and issued in lieu of the
Preferred Stock if necessary to satisfy the requirements of the Debt Commitment
Letter and the provisions of Section 2.8(d). Except as reflected in the Holdings
SEC Reports (including for pending acquisitions) and for employee, officer and
director compensation arrangements in the ordinary course of business, there are
no options, warrants, convertible securities or other rights, agreements,
arrangements or commitments relating to the capital stock of, or other equity
interest in, Holdings obligating Holdings to issue, sell, transfer, vote or
otherwise dispose of or sell any shares of capital stock of, or other equity
interest in, Holdings or its Subsidiaries or obligating Holdings or any of its
Subsidiaries to grant, extend or enter into any such option, warrant,
convertible security or other right, agreement, arrangement or commitment that
would, in any such case, materially affect the ability of C&A Products to
perform its obligations and agreements relating to the Preferred Stock. As of
the date hereof, except as reflected in the Holdings SEC Reports (including for
pending acquisitions) and for employee, officer and director compensation
arrangements in the ordinary course of business, there are no options, warrants,
convertible securities or other rights, agreements, arrangements or commitments
relating to the capital stock of, or other equity interest in, Holdings
obligating Holdings to issue, sell, transfer, vote or otherwise dispose of or
sell any shares of capital stock of, or other equity interest in, Holdings or
its Subsidiaries or obligating Holdings or any of its Subsidiaries to grant,
extend or enter into any such option, warrant, convertible security or other
right, agreement, arrangement or commitment. There are no voting trusts, proxies
or other voting agreements or understandings to which Holdings is a party or by
which it is bound with respect to the shares of capital stock of Holdings.</p>
<p>(b) The authorized capital stock of C&A Products consists of (i) 2,000<b>
</b>shares of common stock, without par value, of which 1,000 shares are issued
and outstanding as of July 31, 2001, all of which are duly authorized, validly
issued, fully paid, nonassessable and were not issued in violation of any
preemptive or similar rights and are owned by Holdings, and (ii) 1,000 shares of
preferred stock, without par value, none of which are issued. Prior to the
Closing, Holdings and C&A Products will take such actions necessary to cause
there to be sufficient capital stock authorized to meet the requirements of the
Transaction Agreements and immediately prior to the Closing, 182,700 (plus such
number of shares as is necessary to meet C&A Products&#39; obligations
to issue additional shares of Series A1 Redeemable Preferred Stock) shares will
have been designated as Series A1 Redeemable Preferred Stock, none of which are
issued and outstanding, 182,700 (plus such number of shares as is necessary to
meet C&A Products&#39; obligations to issue additional shares of Series
A2 Redeemable Preferred Stock) shares will have been designated as Series A2
Redeemable Preferred Stock, none of which are issued and outstanding, 123,700
(plus such number of shares as is necessary to meet C&A Products&#39;
obligations to issue additional shares of Series B1 Redeemable Preferred Stock)
shares will have been designated as Series B1 Redeemable Preferred Stock, none
of which are issued and outstanding, 123,700 (plus such number of shares as is
necessary to meet C&A Products&#39; obligations to issue additional
shares of Series B2 Redeemable Preferred Stock) shares will have been designated
as Series B2 Redeemable Preferred Stock, none of which are issued and
outstanding, 20,000 (plus such number of shares as is necessary to meet C&A
Products&#39; obligations to issue additional shares of Series C1 Redeemable
Preferred Stock) shares will have been designated as Series C1 Redeemable
Preferred Stock, none of which are issued and outstanding and 20,000 (plus such
number of shares as is necessary to meet C&A Products&#39; obligations
to issue additional shares of Series C2 Redeemable Preferred Stock) shares of
Series C2 Redeemable Preferred Stock, none of which are issued and outstanding.
Additional shares of Preferred Stock may be authorized and issued to permit
satisfaction of the provisions of Section 2.8(d). On the Closing Date, the
relative rights, preferences, and limitations of the Preferred Stock will be
substantially as set forth in the Certificate of Designation of C&A Products
attached hereto as Exhibit 1. There are no options, warrants, convertible
securities or other rights, agreements, arrangements or commitments relating to
the capital stock of, or other equity interest in, C&A Products obligating
C&A Products to issue, sell, transfer, vote or otherwise dispose of or sell
any shares of capital stock of, or other equity interest in, C&A Products or
its Subsidiaries or obligating C&A Products or any of its Subsidiaries to
grant, extend or enter into any such option, warrant, convertible security or
other right, agreement, arrangement or commitment that would in any such case
materially affect the ability of C&A Products to perform its obligations and
agreements relating to the Preferred Stock. As of the date hereof, there are no
options, warrants, convertible securities or other rights, agreements,
arrangements or commitments relating to the capital stock of, or other equity
interest in, C&A Products obligating C&A Products to issue, sell,
transfer, vote or otherwise dispose of or sell any shares of capital stock of,
or other equity interest in, C&A Products or its Subsidiaries or obligating
C&A Products or any of its Subsidiaries to grant, extend or enter into any
such option, warrant, convertible security or other right, agreement,
arrangement or commitment. There are no voting trusts, proxies or other voting
agreements or understandings to which C&A Products is a party or by which it
is bound with respect to the shares of capital stock of any of its Subsidiaries.</p>
<font COLOR="#ff0000">
<p>4.3 </font><u><a NAME="_Toc532024493">Stock of Subsidiaries</a></p>
</u>
<p>. Schedule E to this Agreement identifies each entity that is a Subsidiary of
Holdings as of the date hereof. All of the shares of capital stock of the
Subsidiaries listed on Schedule E are owned as of the date hereof by Holdings or
one of its Subsidiaries, free and clear of all Liens (without regard to
subsections (i) through (iv) of the provision in the definition of
&quot;Liens&quot; and other than Liens to secure Indebtedness of Holdings or one
of its Subsidiaries), and have been duly authorized, validly issued and are
fully paid and nonassessable and were not issued in violation of any preemptive
or similar rights, except for any such Liens or where any failure to be duly
authorized, validly issued and fully paid or nonassessable would not,
individually or in the aggregate, be reasonably likely to have a Holdings
Material Adverse Effect.</p>
<font COLOR="#ff0000">
<p>4.4 </font><u><a NAME="_Toc532024494">Valid Issuance of Stock</a></p>
</u>
<p>.</p>
<p>(a) The shares of Holdings Common Stock, when issued, sold and delivered
pursuant to this Agreement, will be duly authorized, validly issued, fully paid
and nonassessable, will not be subject to any preemptive rights or Liens and,
assuming the accuracy of Parent&#39;s representations in Section 3.19, will
be issued in compliance with applicable federal and state securities laws.</p>
<p>(b) The shares of Preferred Stock, when issued, sold and delivered pursuant
to this Agreement, will be duly authorized, validly issued, fully paid and
nonassessable, will not be subject to any preemptive rights or Liens and,
assuming the accuracy of Parent&#39;s representations in Section 3.19, will
be issued in compliance with applicable federal and state securities laws.</p>
<font COLOR="#ff0000">
<p>4.5 <a NAME="_Toc503342984"></a><a NAME="_Toc503343085"></a><a NAME="_Toc503343330"></a></font><u><a NAME="_Toc532024495">Consents
and Approvals; No Violations</a></p>
</u>
<p>. The issuance of the debt and equity securities contemplated by the
Commitment Letter, the execution, delivery or performance of the Transaction
Agreements by Holdings and C&A Products (to the extent each is a party
thereto), and the consummation by Holdings and C&A Products of the
transactions contemplated thereby do not or will not (i) conflict with or result
in any breach of any provision of the certificate of incorporation or
by&#45;laws of Holdings and C&A Products; (ii) conflict with, result in
or constitute a Default under, any of the terms, conditions or provisions of any
Contract to which any of C&A Products or Holdings is a party or by which any
of them or any of their respective properties or assets may be bound; (iii)
conflict with, result in or constitute a Default under, any of the terms,
conditions or provisions of any Permit applicable to Holdings or C&A
Products; or (iv) except as set forth in Section 4.5 of the Holdings Disclosure
Schedule and subject to giving the notices, the occurrence of the required
consultations, compliance with applicable environmental transfer statutes and
obtaining the Requisite Regulatory Approvals referred to in clauses (i) through
(iv) in Section 3.3(a), conflict with or violate any Order or Law applicable to
C&A Products or Holdings or any of their respective properties or assets,
except, in the case of clauses (ii), (iii) or (iv) of this Section 4.5 for
conflicts or Defaults which would not, individually or in the aggregate, be
reasonably likely to have a Holdings Material Adverse Effect or a material
adverse effect on Holdings&#39; and C&A Products&#39; ability to
consummate the Transactions. The terms of the Preferred Stock as set forth in
the Certificate of Designation attached hereto as Exhibit 1 do not breach,
conflict with, violate or otherwise constitute a Default under any Contract to
which Holdings or C&A Products or any of their Subsidiaries is a party,
including any Contract relating to Indebtedness or any Contract relating to any
equity security of Holdings and C&A Products.</p>
<font COLOR="#ff0000">
<p>4.6 </font><u><a NAME="_Toc532024496">SEC Filings; Financial Statements</a></p>
</u>
<p>.</p>
<p>(a) Holdings has timely filed all forms, reports, schedules, statements and
other documents required to be filed by Holdings with the Securities and
Exchange Commission (the &quot;SEC&quot;) since December 31, 1998 (collectively,
the &quot;Holdings SEC Reports&quot;) and such Holdings SEC Reports are publicly
available. The Holdings SEC Reports, at the time filed, did not contain as of
their respective dates (or if amended or superseded by a filing prior to the
date of this Agreement, then on the date of such additional filing), or if filed
after the date hereof, will not contain, any untrue statement of a material fact
or omit to state a material fact required to be stated in such Holdings SEC
Reports or necessary in order to make the statements in such Holdings SEC
Reports, in light of the circumstances under which they were made, not
misleading.</p>
<p>(b) Each of the consolidated financial statements, including any related
notes thereto, contained in the Holdings SEC Reports, complied, as of its
respective date, in all material respects with all applicable accounting
requirements and the published rules and regulations of the SEC with respect
thereto, was prepared in accordance with GAAP applied on a consistent basis with
prior periods (except as otherwise noted therein) and fairly present the
consolidated financial position of Holdings and its Subsidiaries as at the dates
indicated therein and the consolidated results of its operations and cash flows
for the periods indicated therein, subject to, in the case of unaudited interim
financial statements, normal and recurring year&#45;end adjustments which
were not likely to be material in amount.</p>
<font COLOR="#ff0000">
<p>4.7 <a NAME="_Toc516373699"></a></font><u><a NAME="_Toc532024497">Absence of
Certain Changes or Events</a></p>
</u>
<p>. Except as a consequence of, or as expressly contemplated by, this Agreement
and except as disclosed in the Holdings SEC Reports filed and publicly available
prior to the date of this Agreement, since December 31, 2000, Holdings and its
Subsidiaries have not experienced any event, development or change which would,
individually or in the aggregate, be reasonably likely to have a Holdings
Material Adverse Effect.</p>
<font COLOR="#ff0000">
<p>4.8 <a NAME="_Toc516373700"></a></font><u><a NAME="_Toc532024498">No
Undisclosed Liabilities</a></p>
</u>
<p>. Except as disclosed in the Holdings SEC Reports filed and publicly
available prior to the date of this Agreement and except for liabilities and
obligations incurred in the ordinary course of business, since December 31,
2000, (a) neither Holdings nor any of its Subsidiaries has any liabilities or
obligations of any nature (whether accrued, absolute, contingent or otherwise)
required by GAAP to be recognized or disclosed in their financial statements, or
in the notes thereto, except for liabilities or obligations which would not,
individually or in the aggregate, be reasonably likely to have a Holdings
Material Adverse Effect and (b) to the knowledge of the persons identified in
Section 4.8 of the Holdings Disclosure Schedule, Holdings does not have any
liability or obligation of any nature (whether accrued, absolute, contingent or
otherwise) except for liabilities or obligations which would not, individually
or in the aggregate, be reasonably likely to have a Holdings Material Adverse
Effect.</p>
<font COLOR="#ff0000">
<p>4.9 <a NAME="_Toc516373701"></a></font><u><a NAME="_Toc532024499">Litigation</a></p>
</u>
<p>. Except as disclosed in the Holdings SEC Reports filed and publicly
available prior to the date hereof, there are no Litigations pending, or to
Holdings&#39; knowledge, threatened against Holdings or any of its
Subsidiaries, the outcomes of which, individually or in the aggregate, are
reasonably likely to have a Holdings Material Adverse Effect.</p>
<font COLOR="#ff0000">
<p>4.10 <a NAME="_Toc503342985"></a><a NAME="_Toc503343086"></a><a NAME="_Toc503343331"></a></font><u><a NAME="_Toc532024500">Financing</a></p>
</u>
<p>.</p>
<p>(a) Holdings and C&A Products have received and furnished copies to
Parent of (i) a commitment letter to provide debt and receivables financing to
C&A Products and its Subsidiaries (including the Summaries of Terms and
Conditions annexed thereto, the &quot;Debt Commitment Letter&quot;) from
JPMorgan Chase Bank, J.P. Morgan Securities Inc., Credit Suisse First Boston,
Deutsche Banc Alex. Brown Inc., Bankers Trust Company, Merrill Lynch Capital
Corporation and Credit Suisse First Boston, Cayman Islands Branch (collectively
the &quot;Bank&quot;) dated as of November 30, 2001, and (ii) equity commitment
letters (the &quot;Equity Commitment Letters&quot; and, together with the Debt
Commitment Letter, the &quot;Commitment Letters&quot;) to provide equity
financing to Holdings from the persons named therein in the amount contemplated
by the Debt Commitment Letter (the &quot;Equity Sources&quot;). The funds which
the Bank and the Equity Sources have agreed to provide, subject to the terms and
conditions of the Commitment Letters, will be sufficient, when taken together
with other funds available to Holdings and C&A Products (after giving effect
to the transactions referred to in Section 5.21 and assuming the sale of
$250,000,000 of Senior Unsecured Notes, as defined in the Debt Commitment
Letter), to consummate the Transactions and the other transactions contemplated
by the Commitment Letters and to pay all related fees and expenses of Holdings
and C&A Products relating to the Transactions and the other transactions
contemplated by the Commitment Letters (collectively, the &quot;Required
Amount&quot;).</p>
<p>(b) As of the date hereof (i) the Commitment Letters have not been withdrawn
and are in full force and effect and (ii) neither Holdings nor C&A Products
has any reason to believe that any of the conditions set forth in the Commitment
Letters will not be satisfied at or prior to the Closing Date.</p>
<font COLOR="#ff0000">
<p>4.11 </font><u><a NAME="_Toc532024501">Certain Agreements</a></p>
</u>
<p>. Section 4.11 of the Holdings Disclosure Schedule lists each Contract as of
the date hereof to which Holdings or C&A Products is a party relating
directly or indirectly to indebtedness for borrowed money in excess of ten
million dollars ($10,000,000) or the registration, voting or transfer of, or
preemptive rights with respect to, any equity security of Holdings or C&A
Products.</p>
<font COLOR="#ff0000">
<p>4.12 <a NAME="_Toc503342986"></a><a NAME="_Toc503343087"></a><a NAME="_Toc503343332"></a></font><u><a NAME="_Toc532024502">Brokers
and Finders</a></p>
</u>
<p>. No investment banker, broker, finder, or intermediary or other Person is or
will be entitled to any investment banking, brokerage, finder&#39;s,
financial advisory or similar fee or commission from Parent or any
Non&#45;Bison Subsidiary in connection with this Agreement or the
transactions contemplated hereby as a result of any arrangement made by
Holdings.</p>
<font COLOR="#ff0000">
<p ALIGN="CENTER">ARTICLE V<a NAME="_Toc503343089"></a><a NAME="_Toc503343334"></a></font><br>
<br>
<a NAME="_Toc503342988"></a><a NAME="_Toc503343938"></a><a NAME="_Toc503667920"></a><a NAME="_Toc503684851"></a><a NAME="_Toc504459542"></a><a NAME="_Toc505070805"></a><a NAME="_Toc505137401"></a><a NAME="_Toc505767647"></a><a NAME="_Toc506346218"></a><a NAME="_Toc506628536"></a><a NAME="_Toc506775346"></a><a NAME="_Toc507592212"></a><a NAME="_Toc508437285"></a><a NAME="_Toc508709233"></a><a NAME="_Toc514732019"></a><a NAME="_Toc514732757"></a><a NAME="_Toc516456602"></a><a NAME="_Toc516460962"></a><a NAME="_Toc516463378"></a><a NAME="_Toc516560563"></a><a NAME="_Toc518363256"></a><a NAME="_Toc518466837"></a><a NAME="_Toc518733040"></a><a NAME="_Toc518733390"></a><a NAME="_Toc518733484"></a><a NAME="_Toc519520853"></a><a NAME="_Toc519701027"></a><a NAME="_Toc520104873"></a><a NAME="_Toc520108727"></a><a NAME="_Toc520261535"></a><a NAME="_Toc520609464"></a><a NAME="_Toc521132961"></a><a NAME="_Toc521304983"></a><a NAME="_Toc521330760"></a><a NAME="_Toc521426472"></a><a NAME="_Toc521468871"></a><a NAME="_Toc52
1492922"></a><a NAME="_Toc529701258"></a><a NAME="_Toc529706197"></a><a NAME="_Toc529947386"></a><a NAME="_Toc530205106"></a><a NAME="_Toc530215712"></a><a NAME="_Toc530801270"></a><a NAME="_Toc531699864"></a><a NAME="_Toc531774252"></a><a NAME="_Toc531805666"></a><a NAME="_Toc532024503">COVENANTS
RELATING TO CONDUCT OF<br>
BUSINESS AND OTHER AGREEMENTS</a></p>
<p ALIGN="CENTER">&nbsp;</p>
<p><a NAME="_Toc503342989"></a><a NAME="_Toc503343090"></a><a NAME="_Toc503343335"></p>
<font COLOR="#ff0000">
<p>5.1 </font></a><a NAME="_Toc532024504"><u>Conduct of the Business</u></a></p>
<p>. Except as otherwise set forth in Section 5.1 of the Disclosure Schedule and
except for the redemption by Textron Canada Limited of shares of its capital
stock held by Parent prior to the Closing and except for the contemplated
factoring arrangements with respect to receivables of Italian Opco requested by
Holdings, during the period from the date of this Agreement to the Closing Date,
unless Holdings shall otherwise consent in writing (which shall include
electronic mail), which consent shall not be unreasonably withheld, conditioned
or delayed, and except as otherwise expressly contemplated by this Agreement,
the Transition Agreement or the Assignment and Assumption Agreement, or as is
reasonably necessary to effect the Restructuring, Parent will conduct, and will
cause its Subsidiaries to conduct, the Business in the ordinary course of
business and shall use their commercially reasonable efforts to keep available
the services of their current officers and employees, maintain their Permits and
Contracts and preserve their relationships with customers, suppliers, creditors,
agents and others having business dealings with the Business. Without limiting
the generality of the foregoing, and except as consented to in writing by
Holdings, which consent shall not be unreasonably withheld, conditioned or
delayed, or as otherwise contemplated by this Agreement, the Transition
Agreement or the Assignment or Assumption Agreement or as is reasonably
necessary to effect the Restructuring, Parent agrees as to itself and its
Subsidiaries (unless otherwise stated) that:</p>
<p>(a) <u>Capital Stock and Other Securities</u>. Except for shares to be issued
(i) by THI to Textron International Holdings, S.L. in connection with
contributions to capital made in September and December 2000 and (ii) by Textron
Canada Limited to Parent in connection with a contribution to capital to be made
in connection with settlement of an audit by Canada Customs and Revenue Agency,
the Bison Subsidiaries shall not issue, sell, grant, dispose of, pledge or
otherwise encumber or transfer, or cause, authorize or propose the issuance,
sale, grant, disposition or pledge or other encumbrance or transfer of (i) any
additional shares of capital stock of any class of any Bison Subsidiary, or any
securities or rights convertible into, exchangeable for, or evidencing the right
to subscribe for any such shares of capital stock, or any rights, warrants,
options, calls, commitments or any other agreements of any character to purchase
or acquire any such shares of capital stock or any securities or rights
convertible into, exchangeable for, or evidencing the right to subscribe for,
any such shares of capital stock or (ii) any other securities in respect of, in
lieu of, or in substitution for, shares of any Bison Subsidiary outstanding on
the date hereof. No Bison Subsidiary shall split, combine, subdivide or
reclassify any shares of its capital stock.</p>
<p>(b) <u>Reorganization</u>. Neither Parent nor any of the Bison Subsidiaries
shall adopt a plan of complete or partial liquidation, dissolution, merger,
consolidation, restructuring, recapitalization or other reorganization of any
Bison Subsidiary.</p>
<p>(c) <u>Capital Expenditures</u>. Except for capital expenditures in 2001 not
exceeding fifty&#45;five million dollars ($55,000,000) in support of sales
to Fiat by Textron Automotive Company Italia S.r.l., the Bison Subsidiaries will
not make or commit to make any capital expenditures relating to a single project
in excess of fifteen million dollars ($15,000,000) or in the aggregate, in 2001,
in excess of one hundred fifteen million dollars ($115,000,000). Except for
capital expenditures in 2001 not exceeding fifty&#45;five million dollars
($55,000,000) in support of sale to Fiat by Textron Automotive Company Italia
S.r.l., Parent or a Subsidiary of Parent shall consult with C&A Products
with respect to any proposed commitment to make a capital expenditure relating
to a single project in excess of five million dollars ($5,000,000).</p>
<p>(d) <u>No Dispositions</u>. Except for sales of inventory in the ordinary
course of business consistent with past practice, neither Parent nor any of its
Subsidiaries shall sell, lease, license to third parties or otherwise encumber,
subject to a Lien or dispose of any material assets of the Business.</p>
<p>(e) <u>No Acquisitions</u>. No Bison Subsidiary shall acquire or agree to
acquire (i) by merging or consolidating with, or by purchasing a substantial
portion of the assets of, or by any other manner, any business or any
corporation, limited liability company, partnership, joint venture, association
or other entity or division thereof or, (ii) except in the ordinary course of
business consistent with past practice, any assets that, individually or in the
aggregate, except as otherwise permitted by Section 5.1(c), have a purchase
price exceeding one million dollars ($1,000,000), nor shall Parent or any of its
Subsidiaries take any such action relating to the Business set forth in clause
(ii).</p>
<p>(f) <u>Governing Documents</u>. Except as contemplated by Section 5.20, no
Bison Subsidiary shall adopt any amendment to its articles of organization or
articles or certificate of incorporation, as the case may be, or its
by&#45;laws or other equivalent organizational documents, or alter through
merger, liquidation, reorganization, restructuring or in any other fashion the
corporate structure or ownership of any Bison Subsidiary.</p>
<p>(g) <u>Contracts</u>. Except in the ordinary course of business consistent
with past practice, neither Parent nor any of its Subsidiaries shall enter into
any Material Contract with a term extending beyond the Closing Date, and neither
Parent nor any of its Subsidiaries shall modify or amend in any material respect
or transfer or terminate any Material Contract to which Parent or any of its
Subsidiaries is a party or waive, release or assign any material rights or
claims thereunder.</p>
<p>(h) <u>Employee Matters</u>. Except as required by Law or an existing
Contract, neither Parent nor any of its Subsidiaries shall (i) except in the
ordinary course of business consistent with past practice, increase the
compensation or fringe benefits of any employee of the Business, (ii) enter into
any Contract with an officer or director of a U.S. Bison Subsidiary regarding
his or her employment, compensation or benefits or (iii) except pursuant to
collective bargaining, adopt or amend any material Bison Plan to the extent such
adoption or amendment would create or increase in any material respect any
liability or obligation on the part of any Bison Subsidiary.</p>
<p>(i) <u>Accounting Policies and Procedures</u>. Neither Parent nor any of its
Subsidiaries shall make any material change to its accounting methods,
principles or practices with respect to the Business, except as may be required
by GAAP or accounting standards applicable to foreign Bison Subsidiaries.</p>
<p>(j) <u>Liens</u>. Parent shall not, and shall not permit any of its
Subsidiaries to, create, incur, suffer to exist or assume (i) any Lien to secure
Balance Sheet Indebtedness of a Bison Subsidiary or (ii) any other Lien on any
of the material assets of the Business.</p>
<p>(k) <u>Claims</u>. Neither Parent nor any of its Subsidiaries shall settle
any material Litigation relating to the Business or waive, assign or release any
material rights or claims with respect to the Business, except in either case
(i) in the ordinary course of business or (ii) if the settlement of any such
Litigation would not impose material restrictions on the conduct of the
Business.</p>
<p>(l) <u>Taxes</u>. Neither Parent nor any of its Subsidiaries shall make any
Tax election or settle or compromise any Tax liability relating to the Business,
except in the ordinary course of business; <u>provided</u>, <u>however</u>, that
the foregoing restrictions shall not apply to any Tax election or Tax matter
involving a Tax Return which includes (i) a Bison Subsidiary as part of any
combined, unitary, consolidated or similar group which includes Parent or any
Non&#45;Bison Subsidiary and such Tax election or Tax matter would not
individually result in additional post&#45;Closing Taxes in excess of
seventy five thousand dollars ($75,000) being owed by any Bison Subsidiary or
(ii) Textron Canada Limited and such Tax election is solely with respect to, or
such Tax matter solely involves adjustments with respect to, one or more of the
Subsidiaries or businesses listed in Item 1. of Schedule C hereto.</p>
<p>(m) <u>Investments</u>. Except as permitted by Section 5.1(e), no Bison
Subsidiary shall lend any money or make a capital contribution to, or other
investment in any Person other than a Bison Subsidiary.</p>
<p>(n) <u>Affiliate Contracts</u>. Except for Contracts and relationships
contemplated by the Transition Agreement, no Bison Subsidiary shall enter into
any Contract with Parent or any of its Subsidiaries other than (i) Contracts
containing commercially reasonable terms for Contracts between unrelated parties
or (ii) Contracts which do not contain obligations to receive or deliver
products or services after February 1, 2002. Neither Parent nor any of its
Subsidiaries shall modify any Contract existing on the date hereof between a
Bison Subsidiary and Parent or one of the Non&#45;Bison Subsidiaries in a
manner which would involve the addition of terms or conditions which would not
be commercially reasonable for Contracts between unrelated parties.</p>
<p>(o) <u>No Agreements</u>. Neither Parent nor any of its Subsidiaries shall
authorize or announce an intention to do any of the foregoing, or agree or enter
into any Contract to do any of the foregoing.</p>
<font COLOR="#ff0000">
<p>5.2 <a NAME="_Toc503342990"></a><a NAME="_Toc503343091"></a><a NAME="_Toc503343336"></a></font><u><a NAME="_Toc532024505">Access
to Information</a></p>
</u>
<p>.</p>
<p>(a) In order to evaluate the transactions contemplated by this Agreement,
upon reasonable advance notice, Parent shall (and shall cause each of the Bison
Subsidiaries to) provide Holdings and its Subsidiaries and Heartland Industrial
Partners, L.P., and their respective agents and representatives
(&quot;Representatives&quot;), with reasonable access, during normal business
hours and without disruption to their day&#45;to&#45;day business, from
the date of this Agreement to the earlier of the Closing Date or termination of
this Agreement, to the books and records pertaining to the Bison Subsidiaries
and, during such period, it shall (and shall cause each of the Bison
Subsidiaries to) furnish promptly to such Representatives all financial,
operating and other data and other information concerning its business,
properties and personnel as may reasonably be requested. Upon reasonable request
and for reasonable periods of time, Parent will make senior executives of Bison
Subsidiaries available to provide information to Persons who have executed
Commitment Letters and their Representatives for the purpose of providing
information responsive to reasonable due diligence inquiries relating to the
financing contemplated by the Commitment Letters.</p>
<p>(b) Holdings agrees that it will, and will cause its Representatives to, use
any information obtained pursuant to this Section 5.2 only in connection with
the evaluation of the transactions contemplated by this Agreement.</p>
<p>(c) The Confidentiality Agreement shall apply with respect to Information, as
defined therein, furnished pursuant to this Section 5.2.</p>
<p><a NAME="_Toc503342992"></a><a NAME="_Toc503343093"></a><a NAME="_Toc503343338"></p>
<font COLOR="#ff0000">
<p>5.3 </font></a><a NAME="_Toc532024506"><u>Competition Filing</u></a><u>s</p>
</u>
<p>.</p>
<p>(a) Parent and Holdings shall, as promptly as practicable but in any event
not more than 10 business days after the date hereof, file, or cause to be filed
all required notification and report forms under the HSR Act with the Federal
Trade Commission (the &quot;FTC&quot;) and the Antitrust Division of the United
States Department of Justice (the &quot;Antitrust Division&quot;) and will use
their respective commercially reasonable efforts to respond as promptly as
practicable to all inquiries received from the FTC and the Antitrust Division
for additional information or documentation and to cause the waiting periods
under the HSR Act to terminate or expire at the earliest possible date.</p>
<p>(b) Parent and Holdings shall, as promptly as practicable but in any event
not more than 15 business days after the date hereof, file, or cause to be filed
(i) all required forms and letters under the EC Commission Regulation 4064/89
with the European Commission, (ii) all required forms and letters under the
Canadian Competition Act with the Canadian Competition Bureau and (iii) all
required notices to and applications with Governmental Authorities in connection
with the transactions contemplated hereby, and, in each case, will use their
respective commercially reasonable efforts to respond as promptly as practicable
to all inquiries received from the European Commission, the Canadian Competition
Bureau or any other Governmental Authority for additional information or
documentation, and to cause the waiting period under the Canadian Competition
Act or any Foreign Competition Laws to terminate or expire at the earliest
possible date, or consents, approvals or authorizations to be adopted at the
earliest possible date under the EC Commission Regulation 4064/89 or any Foreign
Competition Laws, as may apply.</p>
<p>(c) Parent and Holdings will each furnish to the other such information and
assistance as the other may reasonably request in connection with its
preparation of any filings necessary under the provisions of the HSR Act, EC
Commission Regulation 4064/89, the Canadian Competition Act and any applicable
Foreign Competition Laws.</p>
<p>(d) The parties shall promptly furnish to each other copies of all filings
and correspondence relating to the Transactions with any Governmental Authority
specified in this Section 5.3.</p>
<p><a NAME="_Toc503342993"></a><a NAME="_Toc503343094"></a><a NAME="_Toc503343339"></p>
<font COLOR="#ff0000">
<p>5.4 </font></a><a NAME="_Toc532024507"><u>Consents and Reasonable Efforts</u></a></p>
<p>.</p>
<p>(a) Parent, Holdings and C&A Products shall, as promptly as practical,
use all commercially reasonable efforts (unless otherwise stated herein) to
satisfy the conditions to Closing set forth in Article VI and consummate the
transactions contemplated by this Agreement, including obtaining any required
Consents. Parent, Holdings and C&A Products shall furnish to each other such
information and assistance as the other may reasonably request in connection
with required filings, applications and Consents, and they shall keep each other
advised of the progress of making all such filings, applications and Consents.</p>
<p>(b) Parent, Holdings and C&A Products shall use all commercially
reasonable efforts to terminate the guarantees by Parent or any
Non&#45;Bison Subsidiary of obligations of Bison Subsidiaries identified in
Section 5.4(b) of the Disclosure Schedule (the &quot;Guarantees&quot;) and
arrange for C&A Products to assume the obligations of Parent under the
Guarantees as soon as possible after the Closing Date. If the obligations under
any Guarantee relating to Balance Sheet Indebtedness of a Bison Subsidiary has
not been assumed by C&A Products or a Subsidiary of C&A Products as of
the date thirty days after the Closing Date, Holdings and C&A Products,
jointly and severally, shall, within sixty days after the Closing Date, pay or
cause to be paid all such indebtedness covered by the Guarantee in a manner
which will permit Parent to promptly thereafter terminate the Guarantee. If any
Guarantee shall be in effect after Closing, Holdings and C&A Products,
jointly and severally, shall pay or cause to be paid all debt covered by the
Guarantee as the same shall become due and payable, and shall indemnify and hold
Parent and any Non&#45;Bison Subsidiary harmless with respect to any
payments made by Parent or any Non&#45;Bison Subsidiary pursuant to any
Guarantee, <u>provided</u>, that such payments have been made in good faith.</p>
<p>(c) Parent, Holdings and C&A Products shall use all commercially
reasonable efforts to cause the Contracts identified in Section 5.4(c) of the
Disclosure Schedule (other than Contracts with customers of Bison Subsidiaries
in the name of a Textron Affiliate other than a Bison Subsidiary) to be assigned
to, and assumed by, C&A Products or one or more of its Subsidiaries
(including the Bison Subsidiaries), and to cause Parent and the
Non&#45;Bison Subsidiaries to be released from any further obligations
thereunder, on or before the Closing Date. In the event that Parent or a
Non&#45;Bison Subsidiary is required to guarantee, or otherwise remain
liable for, the performance by C&A Products or any of its Subsidiaries
(including the Bison Subsidiaries) of any such Contract following the assignment
to, and assumption by, C&A Products or its Subsidiaries of such Contract,
(i) on or before the Closing Date, Parent shall deliver to C&A Products a
list of such Contracts and any corresponding guarantee and (ii) C&A Products
or a Subsidiary of C&A Products shall indemnify Parent and the
Non&#45;Bison Subsidiaries from and against and in respect of any and all
Losses incurred by Parent or a Non&#45;Bison Subsidiary to the extent
relating to or arising out of any such guarantee.</p>
<p>(d) Prior to the Closing, Parent shall, and shall cause its Subsidiaries and
their respective Representatives to, provide reasonably requested support to
Holdings and C&A Products in connection with the marketing efforts related
to obtaining the financing contemplated by the Debt Commitment Letters. In
addition, Parent shall request that E&Y provide a comfort letter of the type
customarily required by underwriters in connection with the financing
contemplated by the Debt Commitment Letters.</p>
<p><a NAME="_Toc503342994"></a><a NAME="_Toc503343095"></a><a NAME="_Toc503343340"></p>
<font COLOR="#ff0000">
<p>5.5 </font></a><a NAME="_Toc532024508"><u>Further Assurances</u></a></p>
<p>.</p>
<p>(a) On and after the Closing Date, Parent, Holdings and C&A Products
shall use all commercially reasonable efforts to take or cause to be taken all
necessary or appropriate actions and do, or cause to be done, all things
necessary or appropriate to consummate and make effective the transactions
contemplated hereby and by the other Transaction Agreements, including the
execution of any additional documents or instruments of any kind (not containing
additional representations and warranties) which may be reasonably necessary or
appropriate to carry out any of the provisions hereof. Parent, Holdings and
C&A Products shall cause the License Agreements attached hereto as Exhibits
3A, 3B and 3C, the Assignment and Assumption Agreement attached hereto as
Exhibit 2 and the Registration Rights Agreements attached hereto as Exhibits 5
and 6 to be executed on or prior to Closing.</p>
<p>(b) Holdings and C&A Products shall use their respective reasonable best
efforts to obtain financing in an amount at least equal to the Required Amount,
including by executing definitive agreements for the financing contemplated by
the Commitment Letters on or prior to the Closing Date. Holdings and C&A
Products shall not engage in any transaction outside of the ordinary course of
business that is reasonably likely to jeopardize obtaining funding in an amount
at least equal to the Required Amount. The definitive agreements for such
financing (along with any other document pursuant to which Holdings, C&A
Products or any of their Subsidiaries intend to obtain financing of all or a
portion of the Required Amount) are referred to herein collectively as the
&quot;Financing Agreements.&quot;</p>
<p>(c) Without limiting the generality of the foregoing, in the event that at
any time it may be reasonably likely that funds will not be made available under
the Commitment Letters or Financing Agreements so as to enable Holdings and
C&A Products to proceed with the Transactions in a timely manner, Holdings
and C&A Products shall (i) immediately notify Parent, (ii) use their
respective reasonable best efforts to obtain alternative funding in an amount at
least equal to the amount committed pursuant to the Debt Commitment Letters on
terms and conditions comparable to those provided in the applicable Financing
Agreements or on terms that are not materially more onerous in the aggregate to
Holdings and C&A Products than those in the applicable Debt Commitment
Letter and on other reasonable and customary terms and (iii) shall continue to
use their respective reasonable best efforts to take, or cause to be taken, all
actions and to do, or cause to be done, all things necessary, proper or
advisable under applicable Laws and regulations to consummate the Transactions; <u>provided</u>
that the foregoing shall not require that Holdings or C&A Products secure
equity financing in excess of the amounts contemplated by the Debt Commitment
Letter. Holdings and C&A Products shall promptly notify Parent of all
communications between Holdings and C&A Products and the parties to the
Commitment Letters which are reasonably likely to (A) affect Parent&#39;s
rights or obligations thereunder or hereunder, (B) impact the terms of the
Preferred Stock or (C) delay the Closing. Holdings and C&A Products shall
promptly deliver a copy of any such communication to Parent.</p>
<p>(d) Beginning as soon as practical after the date of this Agreement, Parent
and C&A Products will work together in good faith to identify and resolve
issues relating to the transition from Parent ownership and operation of the
Business to C&A Products ownership and operation of the Business.</p>
<font COLOR="#ff0000">
<p>5.6 <a NAME="_Toc503342995"></a><a NAME="_Toc503343096"></a><a NAME="_Toc503343341"></a></font><a NAME="_Toc532024509"><u>Publicity</u>.</a></p>
<p>Parent and Holdings will consult with each other and will mutually agree upon
any press release or public announcement pertaining to the Transactions and
shall not issue any such press release or public announcement prior to such
consultation and agreement, except as may be required by applicable Law or by
obligations pursuant to any listing agreement with any national securities
exchange, in which case the party proposing to issue such press release or
public announcement shall use its reasonable efforts to consult in good faith
with the other party before issuing any such press release or public
announcement.<a NAME="_Toc503342996"></a><a NAME="_Toc503343097"></a><a NAME="_Toc503343342"></p>
<font COLOR="#ff0000">
<p>5.7 </font></a><a NAME="_Toc532024510"><u>Employee Matters</u>.</a></p>
<p>&nbsp;</p>
<p>(a) <u>Employment Status</u>. C&A Products or one of its Subsidiaries
shall continue to employ all of the Employees who are actively employed by a
Bison Subsidiary on the Closing Date (each such employee being hereafter
referred to as a &quot;Transferred Employee&quot;), it being agreed that persons
who are on lay&#45;off or leave and who have a right to return to work at a
Bison Subsidiary or who are on short&#45;term (not more than six months)
medical disability (including pregnancy leave) who do not thereafter become
eligible for long&#45;term medical disability, or other authorized leave
(such as military, family or other leaves where return to work is subject to
statutory requirements) are to be considered Employees who are actively employed
but that persons on long&#45;term medical disability or whose
short&#45;term medical disability thereafter becomes a long&#45;term
medical disability and persons whose employment has terminated or will terminate
prior to the Closing Date without any right to return to work are not to be
considered Employees who are actively employed; <u>provided</u>, <u>however</u>,
that the provisions of this Section 5.7(a) shall not be construed to limit the
ability of C&A Products to terminate any such Employee at any time for any
reason. For the purposes of this Agreement the terms &quot;layoff&quot;,
&quot;right to return to work&quot;, &quot;short&#45;term disability&quot;,
&quot;long&#45;term disability&quot; and &quot;pregnancy leave&quot; shall
be construed in accordance with the personnel policies of the Bison Subsidiaries
and the collective bargaining agreements covering Employees as of the Closing
Date, if applicable.</p>
<p>(b) <u>Benefits and Compensation</u>.</p>
<p>&#160;&#160;&#160;&#160;&#160;</p>
<blockquote>
  <blockquote>
    <p>(i) C&A Products shall establish, effective as of the Closing Date,
    employee compensation and benefit plans, programs, policies and arrangements
    (including fringe benefits and severance pay) that will provide benefits and
    compensation to the Transferred Employees that are for a period of at least
    one year after the Closing Date (or such longer period as may be required by
    applicable Law) substantially comparable in the aggregate to those provided
    by Bison Subsidiaries to the Transferred Employees immediately prior to the
    Closing Date. Notwithstanding anything to the contrary contained in this
    Agreement, C&A Products shall not terminate any Stand&#45;Alone
    Pension Plan assumed pursuant to Section 5.7(c)(i) or any pension plan into
    which Parent has caused assets to be transferred pursuant to Section 5.7(c)
    for a period of at least 12 months after the Closing Date.</p>
    <p>(ii) C&A Products shall assume responsibility for providing all
    Former Employees (including all Former Employees or Employees who are on
    long&#45;term disability as of the Closing Date) with all medical
    (including Medicare Part B), dental and life insurance benefits being
    provided by Parent or any Affiliate of Parent for Former Employees as of the
    date hereof for a period of at least 12 months.</p>
    <p>(iii) Following the Closing Date, with respect to each employee benefit
    plan in which any Transferred Employee participates, for purposes of
    determining eligibility to participate, vesting and entitlement to benefits,
    including severance benefits and vacation entitlement (but not accrual of
    pension benefits), service with the Bison Subsidiaries (or predecessor
    employers to the extent the Bison Subsidiaries provided past service credit)
    shall be treated as service with C&A Products; <u>provided</u>, <u>however</u>,
    that such service shall not be recognized to the extent that such
    recognition would result in a duplication of benefits. Such service shall
    also apply for purposes of satisfying any waiting periods, evidence of
    insurability requirements or the application of any pre&#45;existing
    condition limitations. Each such plan shall waive pre&#45;existing
    condition limitations to the same extent waived under the applicable plan of
    the Bison Subsidiary. Transferred Employees shall be given credit under the
    applicable plan of Holdings or any Affiliate thereof for amounts paid under
    a corresponding benefit plan during the same period for purposes of applying
    deductibles, co&#45;payments and out&#45;of&#45;pocket maximums
    as though such amounts had been paid in accordance with the terms and
    conditions of the successor or replacement plan.</p>
  </blockquote>
</blockquote>
<p>(c) <u>Pension Plans</u>.</p>
<blockquote>
  <blockquote>
    <p>(i) As of the Closing Date, C&A Products shall assume the
    stand&#45;alone pension plans listed in Section 5.7(c)(i) of the
    Disclosure Schedule (the &quot;Stand&#45;Alone Pension Plans&quot;) and
    all liabilities, and shall receive all assets held, thereunder as of the
    Closing Date.</p>
    <p>(ii) C&A Products shall establish, or shall amend one of its existing
    pension plans, as of the Closing Date, or as soon as practicable after the
    Closing Date, to include, a tax&#45;qualified defined benefit plan
    (&quot;C&A Products&#39; Salaried Pension Plan&quot;) for salaried
    Employees and Former Employees participating in the Textron Master
    Retirement Plan Addendum A (&quot;Parent&#39;s Salaried Pension
    Benefit&quot;). Parent will cause each Transferred Employee participating in
    the Parent&#39;s Salaried Pension Benefit to be fully vested in his/her
    benefits under the Parent&#39;s Salaried Pension Benefit as of the day
    immediately preceding the Closing Date. Subject to the transfer of assets
    described in Section 5.7(c)(iv), C&A Products&#39; Salaried Pension
    Plan shall assume the liabilities as of the Closing Date for the benefits of
    all Employees and Former Employees participating in the Parent&#39;s
    Salaried Pension Benefit. Notwithstanding the provisions of Section
    5.7(b)(i), the C&A Products&#39; Salaried Pension Plan may at any
    time be a cash balance pension plan.</p>
    <p>(iii) C&A Products shall establish, or shall amend one of its
    existing pension plans as of the Closing Date, or as soon as practicable
    after the Closing Date, to include a tax&#45;qualified defined benefit
    plan (&quot;C&A Products&#39; Hourly Pension Plan&quot;) for hourly
    Employees and Former Employees participating in the Textron Master
    Retirement Plan Addenda B, H, L and O (&quot;Parent&#39;s Hourly Master
    Pension Benefit&quot;). Parent will cause each Transferred Employee
    participating in the Parent&#39;s Hourly Master Pension Benefit to be
    fully vested in his/her benefits under the Parent&#39;s Hourly Master
    Pension Benefit as of the day immediately preceding the Closing Date.
    Subject to the transfer of assets described in Section 5.7(c)(iv), C&A
    Products&#39; Hourly Pension Plan shall assume the liabilities as of the
    Closing Date for the benefits of all Employees and Former Employees
    participating in the Parent&#39;s Hourly Master Pension Benefit. Subject
    to applicable collective bargaining agreements and notwithstanding the
    provisions of Section 5.7(b)(i), the C&A Products&#39; Hourly
    Pension Plan may at any time be a cash balance pension plan.</p>
    <p>(iv) On a day which is within 60 days after the later of (i) the date
    upon which C&A Products delivers to the Parent notice that C&A
    Products&#39; actuaries, pursuant to Section 5.7(c)(vii) of this
    Agreement, have reviewed the calculations of Parent&#39;s actuaries and
    are satisfied that such calculations are in accordance with this Agreement,
    or (ii) the day upon which C&A Products delivers to Parent a favorable
    Internal Revenue Service determination letter or an opinion, reasonably
    satisfactory to Parent&#39;s counsel, of C&A Products&#39;
    counsel to the effect that the terms of C&A Products&#39; Salaried
    Pension Plan and C&A Products&#39; Hourly Pension Plan and their
    related trusts qualify, as to form, under Section 401(a) and Section 501(a)
    of the Code, Parent shall cause the trustee under the Parent&#39;s
    Salaried Pension Benefit and Parent&#39;s Hourly Master Pension Benefit
    (&quot;Parent&#39;s Trustee&quot;) to transfer to the trustee of C&A
    Products&#39; Salaried Pension Plan and C&A Products&#39; Hourly
    Pension Plan (&quot;C&A Products&#39; Trustee&quot;) cash assets in
    an amount equal to the amount computed pursuant to the following paragraph,
    but not less than the amount necessary to satisfy the applicable
    requirements of Section 414(1) and 401(a)(12) of the Code.</p>
    <p>(v) The assets to be transferred from Parent&#39;s Trustee to C&A
    Products&#39; Trustee shall be cash only and shall equal 110% of the
    projected benefit obligation as of the Closing Date of the Employees and
    Former Employees under Parent&#39;s Salaried Pension Benefit and
    Parent&#39;s Hourly Master Pension Benefit. The calculation of 110% of
    the projected benefit obligation will be calculated using the actual census
    information as of the Closing Date and by applying (i) a discount rate
    calculated pursuant to the methodologies utilized in Parent&#39;s
    December 31, 2000 audit disclosure prepared for purpose of Statement of
    Financial Accounting Standards Number 87 published by the FASB (&quot;FAS
    87&quot;) and (ii) other actuarial assumptions, methods and methodologies
    utilized in Parent&#39;s FAS 87 audit disclosure, each set forth in
    Section 5.7(c)(vii) of the Disclosure Schedule.</p>
    <p>(vi) The amount transferred pursuant to Section 5.7(c)(iv) shall be
    adjusted for investment earnings or losses of the trust in which Textron
    Master Retirement Plan assets are held for the period between the Closing
    Date and the actual date of transfer and reduced by the amount of any
    benefit payments from such plan to Employees and Former Employees during
    such period and a proportionate share of administrative expenses for such
    period if such administrative expenses are properly chargeable (and are
    actually charged) to the Parent&#39;s Salaried Pension Benefit or
    Parent&#39;s Hourly Master Pension Benefit. Parent shall estimate such
    earnings as of the actual date of transfer and then within 90 days of the
    actual date of transfer, Parent shall cause Parent&#39;s trust to remit
    to C&A Products&#39; trust or C&A Products shall cause C&A
    Products&#39; trust to remit to Parent&#39;s trust, as appropriate,
    an amount equal to the difference between the actual rate of earnings for
    such period and the estimated amount transferred as of the actual date of
    transfer (such difference to be adjusted for investment earnings at the
    State Street Bank short&#45;term rate for the period between the actual
    date of transfer and the date such difference is paid to Parent or C&A
    Products). Notwithstanding anything in this Section 5.7(c) to the contrary,
    following the Closing Date and until the date of the respective transfers of
    assets to trusts under C&A Products&#39; pension plans, Parent shall
    cause the trusts under the pension plans of Parent or an Affiliate covered
    by this Section 5.7(c) to continue to provide benefits to plan participants
    in accordance with the terms of the applicable pension plan to the extent
    that such benefits have accrued on or before the Closing Date. To the extent
    that benefits have accrued after the Closing Date, following the transfer of
    assets pursuant to Section 5.7(c)(iv), C&A Products shall pay such
    benefits to plan participants (retroactively, if applicable) in accordance
    with the terms of the applicable pension plan.</p>
    <p>(vii) The assets caused to be transferred pursuant to Section 5.7(c)
    shall be calculated by Parent&#39;s actuary, and shall be subject to
    review by C&A Products&#39; actuary for the purpose of confirming
    that the calculation was made in accordance with (i) the actuarial
    assumptions and methods set forth in this Section 5.7(c) and in Section
    5.7(c)(vii) of the Disclosure Schedule and (ii) generally accepted actuarial
    practice. As soon as practicable after the Closing Date, Parent shall
    provide C&A Products with a detailed summary of the calculations
    described in this Section 5.7(c) and any back&#45;up data reasonably
    requested by C&A Products. If C&A Products or C&A
    Products&#39; actuary does not notify Parent to the contrary within 60
    days after the delivery to C&A Products of such detailed summary and
    data, the calculations of Parent&#39;s actuary pursuant to this Section
    5.7(c) shall be deemed to be final, conclusive and binding on the parties.
    If, however, C&A Products notifies Parent in writing within such period
    that it and its actuaries believe that the calculations were not prepared in
    accordance with the requirements of this Section 5.7(c) and such notice
    specifies (i) the precise items of the calculations challenged, (ii) the
    basis of the challenge and (iii) the amount of the adjustment they propose
    with respect to each such item, the parties will then attempt to resolve
    their differences with respect thereto. C&A Products shall only be
    entitled to dispute any individual item that involves a proposed adjustment
    of more than $25,000 or items collectively aggregating $100,000 or more. If
    the parties are unable to resolve their dispute within 30 days after the
    date C&A Products notifies Parent of the disputed items, the disputed
    items shall be referred to an international benefits consulting firm (the
    &quot;Actuary Firm&quot;) mutually acceptable to C&A Products and
    Parent. The Actuary Firm shall be asked to resolve such disputes and report
    to Parent and C&A Products upon such remaining disputed items within 45
    days after such referral. The decision of the Actuary Firm shall be final,
    conclusive and binding on the parties hereto. The fees and expenses of the
    Actuary Firm in conducting this assignment shall be borne equally by Parent
    and C&A Products.</p>
  </blockquote>
</blockquote>
<p>(d) <u>Defined Contribution Plan</u>. Parent will cause each Transferred
Employee participating in the Textron Savings Plan to be fully vested in his/her
benefits under the Textron Savings Plan as of the day immediately preceding the
Closing Date. As soon as practicable after the Closing Date and following
delivery by C&A Products to Parent of a favorable Internal Revenue Service
determination letter regarding a defined contribution plan of C&A Products
(the &quot;C&A Products&#39; Savings Plan&quot;) or an opinion,
reasonably satisfactory to Parent, of C&A Products&#39; counsel to the
effect that the terms of the C&A Products&#39; Savings Plan and its
related trust qualify, as to form, under section 401(a) and Section 501(a) of
the Code, Parent shall cause the trustee of the Textron Savings Plan to transfer
all of the assets and liabilities thereof attributable to Transferred Employees
to the C&A Products&#39; Savings Plan. The assets to be transferred
shall be cash, promissory notes for loans made to Transferred Employees under
the terms of the Textron Savings Plan and Parent common stock held in the
accounts of the Transferred Employees. The C&A Products&#39; Savings
Plan shall continue to provide Parent common stock as an investment alternative
for Transferred Employees for at least three years after the Closing Date. Such
Parent common stock investment alternative shall only be available to
Transferred Employees who have Parent common stock transferred from their
account in the Textron Savings Plan to their account in the C&A
Products&#39; Savings Plan and only to the extent of the Parent common stock
so transferred. No new contributions or intraplan transfers will be allowed into
the Parent common stock investment alternative, and amounts transferred out of
the Parent common stock investment alternative may not be transferred to such
investment alternative.</p>
<p>(e) <u>Collective Bargaining Agreements</u>. Effective as of the Closing
Date, C&A Products or a Subsidiary of C&A Products shall assume the
collective bargaining agreements listed in Section 5.7(e) of the Disclosure
Schedule. C&A Products acknowledges that at Closing, C&A Products or
such Subsidiary of C&A Products will become a successor employer under such
collective bargaining agreements and agree to assume all obligations of any
Bison Subsidiary under such agreements.</p>
<p>(f) <u>Severance and Other Liability</u>.</p>
<blockquote>
  <blockquote>
    <p>(i) Except as otherwise set forth in this Section 5.7(f), C&A
    Products or a Subsidiary of C&A Products shall assume, discharge, pay
    and be solely liable for and shall indemnify and hold Parent harmless from
    and against all Losses relating to any Claim or liability arising out of the
    employment of the Employees and Former Employees which is payable after the
    Closing, including Claims or liability under any Bison Plan; <u>provided</u>,
    <u>however</u>, that C&A Products and its Subsidiaries shall not be
    liable for any Claim arising from an event occurring prior to Closing to the
    extent that it is covered by insurance carried by Parent or a Subsidiary of
    Parent.</p>
    <p>(ii) Parent shall retain any and all liability for Losses relating to
    severance costs incurred by Parent or its Subsidiaries (including the Bison
    Subsidiaries) on or prior to the Closing that relate to employees of any
    Subsidiary of Parent, whether or not any such employee is transferred to a
    Bison Subsidiary on or prior to the Closing Date, except for Losses relating
    to the termination of employees at the written request of Holdings or
    C&A Products.</p>
    <p>(iii) C&A Products shall pay 50%, and Parent shall pay the other 50%,
    of any Severance Payment payable to persons identified in Section 5.7(f)(A)
    of the Disclosure Schedule if such amount is payable as a result of such
    person&#39;s termination of his or her employment after the Closing Date
    and during the term of said agreement for &quot;good reason&quot;, as
    defined in the agreement relating to such person listed in Section 5.7(f)(A)
    of the Disclosure Schedule; <u>provided</u>, <u>however</u>, that C&A
    Products and its Subsidiaries shall not be responsible for Severance
    Payments to such persons in excess of 50% of the amount set forth for each
    such person in Section 5.7(f)(B) of the Disclosure Schedule, and any
    remaining amount shall be paid by Parent. Except as set forth in the
    preceding sentence, C&A Products shall pay 100% of any Severance Payment
    if such amount is payable as a result of a Qualifying Termination, as
    defined in the agreement relating to such person listed in Section 5.7(f)(A)
    of the Disclosure Schedule (each an &quot;Employee Agreement&quot;), which
    occurs after the Closing Date; <u>provided</u>, that Parent shall reimburse
    C&A for the cost of any such payment above the amount set forth in
    Section 5.7(f)(B) of the Disclosure Schedule. &quot;Severance Payment&quot;
    shall mean the severance benefits payable pursuant to the Employment
    Agreements.</p>
    <p>(iv) C&A Products shall pay the portion of any Retention Payment
    payable to persons identified in Sections 5.7(f)(A) of the Disclosure
    Schedule equal to a fraction (the &quot;Fraction&quot;) whose numerator is
    365 minus the number of days elapsed from and including January 1, 2001,
    through the Closing Date, and whose denominator is 365, up to a maximum
    amount for each person equal to the amount set forth in Section 5.7(f)(B) of
    the Disclosure Schedule multiplied by the Fraction. Parent shall pay the
    balance of the Retention Payments. The term &quot;Retention Payment&quot;
    shall mean the retention awards and any special operating incentive and
    divestiture incentive awards payable pursuant to the Employment Agreements.</p>
    <p>(v) Except for payments by C&A Products described in Sections
    5.7(f)(iii) and 5.7(f)(iv), C&A Products shall not be liable for any
    severance or retention payments payable under any written agreement signed
    by an Employee and existing prior to Closing, excluding agreements entered
    into in the ordinary course of business with Employees of a Bison Subsidiary
    organized under the laws of a jurisdiction other than the United States and
    excluding collective bargaining agreements (it being understood and agreed
    that company policies generally applicable to all or a class of employees
    shall not be deemed to be an agreement for the purposes of this subsection).</p>
    <p>(vi) Except as set forth in Section 5.1(h) of the Disclosure Schedule,
    neither Parent nor its Subsidiaries shall amend, or cause to be amended, any
    term or provision in any agreement listed in Section 5.7(f)(A) of the
    Disclosure Schedule without the prior written consent of Holdings.</p>
    <p>(vii) Payments which are the responsibility of Parent under Sections
    5.7(f)(ii), (iii), (iv) and (v) shall be paid to the person by C&A
    Products within five days after receipt from Parent of funds equal to the
    amount of said payments.</p>
  </blockquote>
</blockquote>
<p>(g) <u>Worker&#39;s Compensation Claims</u>. C&A Products shall
assume liability for all suits, claims, proceedings and actions pending as of or
commenced after the Closing Date resulting from actual or alleged harm or injury
to Employees or Former Employees regardless of when the incident or accident
giving rise to such liability occurred or occurs. Holdings will make all
necessary arrangements to assume all worker&#39;s compensation claim files,
whether open or closed, as of the Closing Date, and will make the necessary
arrangements for assuming the continued management of such liabilities.</p>
<p>(h) <u>Foreign Plans</u>. To the extent that Employees and Former Employees
(or employees or former employees of THI or its Subsidiaries) are located in a
jurisdiction outside of the United States and are covered by defined benefit
plans or similar plans which also cover persons employed by Parent, any
Non&#45;Bison Subsidiary or their Affiliates, Holdings will cause similar
plans to be established for such persons in accordance with applicable Law,
labor agreements and customary practice, and Parent will cause assets to be
transferred to the applicable trusts of such successor plans established by
C&A Products, it being agreed that the amount of assets to be transferred to
such trusts will be the minimum amount required by applicable Law.</p>
<font COLOR="#ff0000">
<p>5.8 <a NAME="_Toc503342997"></a><a NAME="_Toc503343098"></a><a NAME="_Toc503343343"></a></font><u><a NAME="_Toc532024511">Tax
Matters</a></p>
</u>
<p>&nbsp;</p>
<p>(a) <u>Tax Returns</u>. Except as provided in Section 9.13,</p>
<blockquote>
  <blockquote>
    <p>(i) Parent shall file or cause to be filed when due all Tax Returns that
    are required to be filed by or with respect to each of the Bison
    Subsidiaries (other than Permali do Brasil Industria e Comercio Ltda.
    (&quot;Permali&quot;), Rosario Project S.A. (&quot;Rosario&quot;), Plascar,
    and TATB, collectively, the &quot;Brazilian Entities&quot;) for taxable
    years or periods ending on or before the Closing Date, and Parent shall
    remit (or cause to be remitted) any Taxes due in respect of such Tax
    Returns.</p>
    <p>(ii) Parent shall file or cause to be filed when due all Tax Returns that
    are required to be filed by or with respect to each of the Brazilian
    Entities that are due on or before the Closing Date, and Parent shall remit
    (or cause to be remitted) any Taxes due in respect of such Tax Returns.</p>
    <p>(iii) Holdings shall file or cause to be filed when due all Tax Returns
    that are required to be filed by or with respect to each of the Brazilian
    Entities that are due after the Closing Date with respect to taxable years
    or periods ending on or before the Closing Date or Straddle Periods, and
    Holdings shall remit (or cause to be remitted) any Taxes due in respect of
    such Tax Returns.</p>
    <p>(iv) Holdings shall file or cause to be filed when due all Tax Returns
    that are required to be filed by or with respect to each of the Bison
    Subsidiaries (other than the Brazilian Entities and THI and its
    Subsidiaries) for taxable years or periods ending after the Closing Date,
    and Holdings shall remit (or cause to be remitted) any Taxes due in respect
    of such Tax Returns.</p>
    <p>(v) Any Tax Return required to be filed by Holdings relating to any
    Straddle Period shall be submitted (with copies of any relevant schedules,
    work papers and other documentation then available) to Parent for
    Parent&#39;s approval not less than 45 days prior to the due date
    (including extensions) for the filing of such Tax Return, which approval
    shall not be unreasonably withheld, conditioned or delayed. Parent shall
    have the option of providing to Holdings, at any time at least 30 days prior
    to the due date, written instructions as to how Parent wants any, or all, of
    the items for which it may be liable reflected on such Tax Return. Holdings
    shall, in preparing such return, cause the items for which Parent is liable
    hereunder to be reflected in accordance with Parent&#39;s instructions
    (unless, in the opinion of nationally recognized tax advisor to Holdings,
    complying with Parent&#39;s instructions would likely subject Holdings
    to any criminal penalty or to one or more civil penalties under Sections
    6662 through 6664 of the Code or similar provisions of applicable state,
    local or foreign laws) and, in the absence of having received such
    instructions, in accordance with past practice, if any, to the extent
    permissible under applicable Law.</p>
    <p>(vi) Upon the written request of Holdings setting forth in detail the
    computation of the amount owed, Parent shall pay to Holdings, no later than
    2 days prior to the due date for the applicable Tax Return, the Taxes for
    which Parent is liable pursuant to Section 5.8(b) but which are payable with
    any Tax Return to be filed by Holdings with respect to any Straddle Period.</p>
    <p>(vii) Within 120 days after the Closing Date, Holdings shall cause each
    of the Bison Subsidiaries (other than THI and its Subsidiaries) to prepare
    and provide to Parent a package of Tax information materials, including
    schedules and work papers required by Parent to enable Parent to prepare and
    file all Tax Returns required to be prepared and filed by it pursuant to
    Section 5.8(a)(i). Holdings shall prepare such package in good faith in a
    manner substantially consistent with Parent&#39;s past practice.</p>
    <p>(viii) Parent may amend any Tax Return filed or required to be filed by
    or with respect to each of the Bison Subsidiaries (other than the Brazilian
    Entities) for any taxable years or periods ending on or before the Closing
    Date; <u>provided</u>, that no such amendment shall be permitted if it would
    result in any Tax Detriment to any Bison Subsidiary after the Closing.</p>
  </blockquote>
</blockquote>
<p>(b) <u>Computation of Tax Liabilities</u>.</p>
<blockquote>
  <blockquote>
    <p>(i) To the extent permitted or required by law or administrative
    practice, (A)&#160;the taxable year of each Bison Subsidiary which
    includes the Closing Date shall be treated as closing on (and including) the
    Closing Date and, notwithstanding the foregoing, (B)&#160;all
    transactions not in the ordinary course of business occurring after the
    Closing Date shall be reported on Holdings&#39; consolidated United
    States federal income Tax Return to the extent permitted by Treasury
    Regulation Section 1.1502&#45;76(b)(1)(ii)(B) and shall be similarly
    reported on other Tax Returns of Holdings or its Affiliates to the extent
    permitted by applicable Law. For purposes of Sections 5.8, where it is
    necessary to apportion between Parent and Holdings the Tax liability of an
    entity for a Straddle Period (which is not treated under the immediately
    preceding sentence as closing on the Closing Date), such liability shall be
    apportioned between the period deemed to end at the close of the Closing
    Date, and the period deemed to begin at the beginning of the day following
    the Closing Date on the basis of an interim closing of the books, except
    that Taxes (such as real property Taxes) imposed on a periodic basis shall
    be allocated on a daily basis.</p>
    <p>(ii) In determining Parent&#39;s liability for Taxes pursuant to this
    Agreement, Parent shall be credited with the amount of estimated Taxes paid
    by or on behalf of any of the Bison Subsidiaries prior to the Closing. To
    the extent that Parent&#39;s liability for Taxes for a taxable year or
    period is less than the amount of estimated income Taxes previously paid by
    or on behalf of any of the Bison Subsidiaries (other than THI and its
    Subsidiaries) with respect to all or a portion of such taxable year or
    period, Holdings shall pay Parent the difference within two days of filing
    the Tax Return relating to such income Taxes.</p>
  </blockquote>
</blockquote>
<p>(c) <u>Refunds</u>.</p>
<blockquote>
  <blockquote>
    <p>(i) Any Tax refund (including any interest in respect thereof) received
    by Holdings, C&A Products or any of the Bison Subsidiaries (other than
    the Brazilian Entities and THI and its Subsidiaries), and any amounts
    credited against Tax to which Holdings, C&A Products or any of the Bison
    Subsidiaries (other than the Brazilian Entities and THI and its
    Subsidiaries) becomes entitled (including by way of any amended Tax Returns
    or any carryback filing), that relate to any taxable period, or portion
    thereof, ending on or before the Closing Date shall be for the account of
    Parent, and Holdings shall pay over to Parent any such refund or the amount
    of any such credit within 15 days after receipt of such credit or
    entitlement thereto.</p>
    <p>(ii) Any Tax refund (including any interest in respect thereof) received
    by Permali or Rosario, and any amounts credited against Tax to which Permali
    or Rosario becomes entitled (including by way of any amended Tax Returns or
    any carryback filing), that relate to any taxable period, or portion
    thereof, ending on or before the Closing Date shall be for the account of
    Parent, and Holdings shall pay over to Parent any such refund or the amount
    of any such credit within 15 days after receipt of such credit or
    entitlement thereto.</p>
    <p>(iii) The percentage (the &quot;Ownership Percentage&quot;), equal to the
    lesser of (A) 56.6% or (B) the percentage of issued and outstanding stock of
    Plascar held by Permali, of any Tax refund (including any interest in
    respect thereof) received by Plascar or TATB or any amounts credited against
    Tax to which Plascar or TATB becomes entitled (including by way of any
    amended Tax Returns or any carryback filing), that relate to any taxable
    period, or portion thereof, ending on or before the Closing Date shall be
    for the account of Parent, and Holdings shall pay over to Parent the
    Ownership Percentage of any such refund or credit within 15 days after
    receipt of such credit or entitlement thereto.</p>
    <p>(iv) Holdings shall pay Parent interest at the rate prescribed under
    Section 6621(a)(1) of the Code, compounded daily, on any amount not paid
    when due under this Section 5.8(c). For purposes of this Section 5.8(c),
    where it is necessary to apportion a refund or credit between Holdings and
    Parent for a Straddle Period, such refund or credit shall be apportioned
    between the period deemed to end at the close of the Closing Date and the
    period deemed to begin at the beginning of the day following the Closing
    Date on the basis of an interim closing of the books of each of the Bison
    Subsidiaries (other than THI and its Subsidiaries), except that refunds or
    credits of Taxes imposed on a periodic basis (e.g., real property Taxes)
    shall be allocated on a daily basis.</p>
    <p>(v) Holdings shall cooperate, and cause C&A Products and each of the
    Bison Subsidiaries (other than THI and its Subsidiaries) to cooperate, in
    obtaining, at Parent&#39;s expense, any Tax refund (other than a refund
    based on a carryback from a taxable year or period beginning after the
    Closing Date) that Parent reasonably believes is available based on
    substantial authority, including through filing appropriate forms with the
    applicable Tax Authority; <u>provided</u>, that if the refund would result
    in any Tax Detriment to any Bison Subsidiary after the Closing, Parent shall
    reimburse Holdings the amount of such Tax Detriment.</p>
  </blockquote>
</blockquote>
<p>(d) <u>Certain Post&#45;Closing Settlement Payments</u>.</p>
<blockquote>
  <blockquote>
    <p>(i) If the examination of any federal, state, local or other Tax Return
    of Parent for any taxable period ending on or before the Closing Date shall
    result (by settlement or otherwise) in any adjustment which permits
    Holdings, C&A Products or any of the Bison Subsidiaries (other than THI
    and its Subsidiaries) to increase deductions, losses or tax credits or
    decrease the income, gains or recapture of tax credits which would otherwise
    (but for such adjustments) have been reported or taken into account
    (including by way of any increase in basis) by Holdings, C&A Products or
    any of the Bison Subsidiaries (other than THI and its Subsidiaries) for one
    or more periods ending within ten years after the Closing Date, Parent shall
    notify Holdings and provide it with adequate information so that Holdings
    can reflect on its, C&A Products&#39; or the applicable Bison
    Subsidiary&#39;s Tax Returns such increases in deductions, losses or tax
    credits or decreases in income, gains or recapture of tax credits. Holdings
    shall pay to Parent, within 30 days of the realization of any resulting Tax
    Benefits, the amount of any resulting Tax Benefits.</p>
    <p>(ii) If the examination of any federal, state, local or other Tax Return
    of Holdings, C&A Products or any of the Bison Subsidiaries for any
    taxable period ending after the Closing Date shall result (by settlement or
    otherwise) in any adjustment which permits Parent to increase deductions,
    losses or tax credits or decrease the income, gains or recapture of tax
    credits which would otherwise (but for such adjustments) have been reported
    or taken into account (including by way of any increase in basis) by Parent
    for one or more periods ending on or before the Closing Date, Holdings shall
    notify Parent and provide it with adequate information so that Parent can
    reflect on its Tax Returns such increases in deductions, losses or tax
    credits or decreases in income, gains or recapture of tax credits. Parent
    shall pay to Holdings, within 30 days of the receipt of such information,
    the amount of any resulting Tax Benefits.</p>
  </blockquote>
</blockquote>
<p>(e) <u>Post&#45;Closing Actions which Affect Parent&#39;s Liability
for Taxes</u>.</p>
<blockquote>
  <blockquote>
    <p>(i) Holdings shall not take, or cause or permit C&A Products or any
    of the Bison Subsidiaries (other than THI and its Subsidiaries) (or any of
    their Affiliates) to take, any action, with respect to the taxable year or
    period of Holdings, C&A Products, such Bison Subsidiary, or Affiliate,
    as applicable, which includes the Closing Date, which would be reasonably
    likely to increase Parent&#39;s or any Non&#45;Bison Subsidiaries
    (or any of their Affiliates) liability for Taxes (including any liability of
    Parent to indemnify Holdings for Taxes pursuant to this Agreement)
    including, for example, any action which would be reasonably likely to,
    result in, or change the character of, any income or gain (including any
    Subpart F income) that Parent or any Non&#45;Bison Subsidiary (or any of
    their Affiliates) must report on any Tax Return.</p>
    <p>(ii) None of Holdings or any Affiliate of Holdings (including C&A
    Products) shall (or shall cause or permit any of the Bison Subsidiaries
    (other than THI and its Subsidiaries) to) amend, refile or otherwise modify
    any Tax Return relating in whole or in part to any of the Bison Subsidiaries
    with respect to any taxable year or period ending on or before the Closing
    Date (or with respect to any Straddle Period) without the prior written
    consent of Parent, which consent may be withheld in the sole discretion of
    Parent.</p>
    <p>(iii) Except to the extent otherwise required by Law, none of Holdings or
    any Affiliate of Holdings (including C&A Products) shall (or shall cause
    or permit any of the Bison Subsidiaries (other than THI and its
    Subsidiaries) to) carryback for federal, state, local or foreign tax
    purposes to any taxable period, or portion thereof, of any of the Bison
    Subsidiaries (other than THI and its Subsidiaries) or Parent or any
    Affiliate of Parent ending before, or which includes, the Closing Date any
    operating losses, net operating losses, capital losses, tax credits or
    similar items arising in, resulting from, or generated in connection with a
    taxable year of Holdings or any Affiliate of Holdings (including C&A
    Products), or portion thereof, ending on or after the Closing Date.</p>
  </blockquote>
</blockquote>
<p>(f) <u>Assistance and Cooperation</u>. After the Closing Date, each of Parent
and Holdings shall, (and shall cause their respective Affiliates to), provide
information to the other party regarding any of the Bison Subsidiaries or the
Business in connection with (i) the other party preparing any Tax Returns which
such other party is responsible for preparing and filing, and (ii) the other
party preparing for any audits of, or disputes with any Tax Authority regarding,
any Tax Returns of any of the Bison Subsidiaries. In connection therewith,
Holdings, C&A Products and Parent shall not dispose of any Tax work papers,
books or records relating to any of the Bison Subsidiaries during the
six&#45;year period following the Closing Date, and thereafter shall give
the other parties reasonable written notice before disposing of such items.</p>
<p>(g) <u>Section 338(g) Elections</u>. Holdings shall ensure that C&A
Products does not make any election under Section 338(g) of the Code (or any
analogous provision of state, local, or foreign law) with respect to the
purchase of the stock of any foreign Bison Subsidiary without the prior written
consent of Parent, which consent may be withheld in the sole discretion of
Parent. If Parent does so consent, Holdings and C&A Products shall jointly
and severally be liable for, and shall pay, any Tax attributable to, or
resulting from, the making of such election and will indemnify Parent from and
against any Tax liability or other adverse consequences attributable to, or
resulting directly or indirectly from, the making of such election. Any
indemnification obligation of Holdings and C&A Products pursuant to this
Section 5.8(g) shall be increased by the relevant After Tax Amount. For purposes
of this Agreement, &quot;After Tax Amount&quot; means any additional amount
necessary to reflect the tax consequences of the receipt or accrual of such
reimbursement payment (including the payment of an additional amount or amounts
hereunder) determined by using the actual marginal federal, state, foreign or
local rates for the relevant taxable period.</p>
<p>(h) <u>Stock Options</u>. Holdings and its Affiliates (including C&A
Products and the Bison Subsidiaries (other than THI and its Subsidiaries)) shall
not claim any Tax deduction arising by reason of any exercise of an employee
stock option to acquire Parent stock held by employees of any Bison Subsidiary.
If, however, all or any part of a Tax deduction claimed by Parent with respect
to the exercise of an option to acquire Parent stock held by employees of any
Bison Subsidiary is disallowed to Parent, then, to the extent permitted by law,
Holdings, C&A Products or a Bison Subsidiary (or their appropriate
Affiliate) shall claim such Tax deduction. If Holdings, C&A Products or a
Bison Subsidiary (or any of their Affiliates) receives any Tax Benefit in any
taxable period as a result of any Tax deduction claimed by Holdings, C&A
Products or a Bison Subsidiary (other than THI and its Subsidiaries) (or any of
their Affiliates) pursuant to this Section 5.8(h), Holdings shall promptly pay
to Parent the amount of such Tax Benefit.</p>
<p>(i) <u>Indemnification by Parent</u>. Notwithstanding any other provision of
this Agreement, Parent shall indemnify Holdings from and against and in respect
of any and all Losses incurred by Holdings (or with respect to subsection (ii)
below, by Holdings or THI and its Subsidiaries, without duplication), which may
be imposed on, sustained, incurred or suffered by or assessed against Holdings
(or with respect to subsection (ii) below, by Holdings or THI and its
Subsidiaries, without duplication), directly or indirectly, to the extent
relating to or arising out of:</p>
<blockquote>
  <blockquote>
    <p>(i) any liability for income Taxes imposed on any of the Bison
    Subsidiaries (other than the Brazilian Entities) as members of the
    &quot;affiliated group&quot; (within the meaning of Section 1504(a) of the
    Code) of which Parent (or any predecessor or successor) is the common parent
    that arises under Treasury Regulation Section 1.1502&#45;6(a) or
    comparable provisions of foreign, state or local Law;</p>
    <p>(ii) any liability for Taxes (including Taxes resulting from the
    Restructuring), imposed on any of the Bison Subsidiaries (other than the
    Brazilian Entities) for any taxable year or period that ends on or before
    the Closing Date and, with respect to any Straddle Period, the portion of
    such Straddle Period deemed to end on and include the Closing Date;</p>
    <p>(iii) any liability for Taxes (including Taxes resulting from the
    Restructuring), imposed on Permali or Rosario for any taxable year or period
    that ends on or before the Closing Date and, with respect to any Straddle
    Period, the portion of such Straddle Period deemed to end on and include the
    Closing Date, but only to the extent such Taxes exceed the accrual or
    reserve for Taxes (excluding any reserve for deferred Taxes established to
    reflect timing differences between book and Tax income) recorded in the
    December 30, 2000 Statement of Net Assets to be Sold, as adjusted to take
    into account the extent to which (A) Parent&#39;s indemnification for a
    liability for Taxes pursuant to any clause of this Section 5.8(i) has
    previously been reduced or eliminated as a result of the application of such
    accrual or reserve for Taxes and (B) Holdings&#39; indemnification for a
    liability for Taxes pursuant to any clause of Section 5.8(j) has previously
    been paid as a result of the application of such accrual or reserve for
    Taxes;</p>
    <p>(iv) the Ownership Percentage of any liability for Taxes (including Taxes
    resulting from the Restructuring), imposed on Plascar or TATB for any
    taxable year or period that ends on or before the Closing Date and, with
    respect to any Straddle Period, the portion of such Straddle Period deemed
    to end on and include the Closing Date, but only to the extent such
    liability exceeds the Ownership Percentage of the accrual or reserve for
    Taxes (excluding any reserve for deferred Taxes established to reflect
    timing differences between book and Tax income) recorded in the December 30,
    2000 Statement of Net Assets to be Sold, as adjusted to take into account
    the extent to which (A) Parent&#39;s indemnification for a liability for
    Taxes pursuant to any clause of this Section 5.8(i) has previously been
    reduced or eliminated as a result of the application of such accrual or
    reserve for Taxes and (B) Holdings&#39; indemnification for a liability
    for Taxes pursuant to any clause of Section 5.8(j) has previously been paid
    as a result of the application of such accrual or reserve for Taxes;</p>
    <p>(v) any liability, or increase in a liability, for Taxes imposed as a
    result of any failure by Parent or any of its Affiliates to perform or
    comply with its obligations under Section 5.8(m); and</p>
    <p>&nbsp;</p>
    <p>(vi) indemnification pursuant to this Section 5.8(i) shall be the sole
    and exclusive remedy of Holdings and C&A Products against Parent with
    respect to any and all Losses arising under or related to any liability for
    Taxes.</p>
  </blockquote>
</blockquote>
<p>(j) <u>Indemnification by Holdings</u>. Notwithstanding any other provision
of this Agreement, Holdings and C&A Products shall jointly and severally
indemnify Parent from and against and in respect of any and all Losses incurred
by Parent, which may be imposed on, sustained, incurred or suffered by or
assessed against Parent, directly or indirectly, to the extent relating to or
arising out of:</p>
<blockquote>
  <blockquote>
    <p>(i) any liability for Taxes imposed on any of the Bison Subsidiaries
    (other than THI and its Subsidiaries) for any taxable year or period that
    begins after the Closing Date and, with respect to any Straddle Period, the
    portion of such Straddle Period beginning the day after the Closing Date;</p>
    <p>(ii) any liability for Taxes imposed on Permali or Rosario for any
    taxable year or period that ends on or before the Closing Date and, with
    respect to any Straddle Period, the portion of such Straddle Period deemed
    to end on and include the Closing Date, but only to the extent of the
    accrual or reserve for Taxes (excluding any reserve for deferred Taxes
    established to reflect timing differences between book and Tax income)
    recorded in December 30, 2000 Statement of Net Assets to be Sold, as
    adjusted to take into account the extent to which (A) Parent&#39;s
    indemnification for a liability for Taxes pursuant to any clause of Section
    5.8(i) has previously been reduced or eliminated as a result of the
    application of such accrual or reserve for Taxes and (B) Holdings&#39;
    indemnification for a liability for Taxes pursuant to any clause of this
    Section 5.8(j) has previously been paid as a result of the application of
    such accrual or reserve for Taxes;</p>
    <p>(iii) the Ownership Percentage of any liability for Taxes imposed on
    Plascar or TATB for any taxable year or period that ends on or before the
    Closing Date and, with respect to any Straddle Period, the portion of such
    Straddle Period deemed to end on and include the Closing Date, but only to
    the extent of the Ownership Percentage of the accrual or reserve for Taxes
    (excluding any reserve for deferred Taxes established to reflect timing
    differences between book and Tax income) recorded in December 30, 2000
    Statement of Net Assets to be Sold, as adjusted to take into account the
    extent to which (A) Parent&#39;s indemnification for a liability for
    Taxes pursuant to any clause of Section 5.8(i) has previously been reduced
    or eliminated as a result of the application of such accrual or reserve for
    Taxes and (B) Holdings&#39; indemnification for a liability for Taxes
    pursuant to any clause of this Section 5.8(j) has previously been paid as a
    result of the application of such accrual or reserve for Taxes;</p>
    <p>(iv) any liability, or increase in a liability, for Taxes imposed on
    Parent or any of its Affiliates as a result of any failure by Holdings to
    perform or comply with its obligations under Section 5.8(e)(i) of this
    Agreement;</p>
    <p>(v) any increase in net liability for Taxes imposed on Parent or any of
    its Affiliates in connection with or related to the transactions
    contemplated by Section 5.21(a) (including any increase in net Tax liability
    resulting from the sale of assets pursuant to the transactions contemplated
    by Section 5.21(a)) other than (i) any Tax liability imposed on Parent or
    any of its Affiliates resulting from the transfer of all of the stock of
    Textron Automotive Exteriors Inc., Textron Automotive Interiors Inc., or
    Textron Properties Inc. to C&A Products pursuant to Section 2.1 of this
    Agreement, determined, for such purposes only, by assuming that the
    transactions contemplated by Section 5.21(a) had not occurred, and (ii) any
    increase in net income Tax liability imposed on Parent or any of its
    Affiliates resulting from the transactions contemplated by Section 5.21(a)
    for any taxable year or period or portions thereof beginning the day after
    the closing of all of the transactions contemplated by Section 5.21(a); <u>provided</u>,
    that any indemnification obligation of Holdings pursuant to this subsection
    shall be increased by the relevant After Tax Amount;</p>
    <p>(vi) except as otherwise provided in Sections 5.8(g), indemnification
    pursuant to this Section 5.8(j) shall be the sole and exclusive remedy of
    Parent against Holdings and C&A Products with respect to any and all
    Losses arising under or related to any liability for Taxes.</p>
  </blockquote>
</blockquote>
<p>(k) <u>Contests</u>.</p>
<blockquote>
  <blockquote>
    <p>(i) <u>Notice</u>. After the Closing Date, Holdings and Parent each shall
    notify the other party in writing within 15 days of the commencement of any
    Tax audit or administrative or judicial proceeding affecting the Taxes of
    any of the Bison Subsidiaries, which, if determined adversely to the
    taxpayer (&quot;Tax Indemnitee&quot;) or after the lapse of time would be
    grounds for indemnification under this Section 5.8 by the other party
    (&quot;Tax Indemnitor&quot;). Such notice shall contain factual information
    describing any asserted Tax liability in reasonable detail and shall include
    copies of any notice or other document received from any Tax Authority in
    respect of any such asserted Tax liability. If either Holdings or Parent
    fails to give the other party prompt notice of an asserted Tax liability as
    required under this Agreement, then (A) if the Tax Indemnitor is precluded
    by the failure to give prompt notice from contesting the asserted Tax
    liability in any judicial forum, then such party shall not have any
    obligation to indemnify the other party for any Losses arising out of such
    asserted Tax liability and (B) if the Tax Indemnitor is not so precluded
    from contesting, if such failure to give prompt notice results in a
    detriment to the Tax Indemnitor, then any amount which the Tax Indemnitor is
    otherwise required to pay pursuant to this Section 5.8 with respect to such
    liability shall be reduced by the amount of such detriment.</p>
    <p>(ii) <u>Control of Contests Involving Pre&#45;Closing Periods or
    Straddle Periods</u>. In the case of an audit or administrative or judicial
    proceeding involving any asserted liability for Taxes relating to any
    taxable years or periods ending on or before the Closing Date or any
    Straddle Period of any Bison Subsidiaries, Parent shall have the right, at
    its expense, to control the conduct of such audit or proceeding; <u>provided</u>,
    <u>however</u>, that (i) Parent shall keep Holdings reasonably informed with
    respect to the status of such audit or proceeding and provide Holdings with
    copies of all written correspondence with respect to such audit or
    proceeding in a timely manner and (ii) if such audit or proceeding would be
    reasonably expected to result in a material increase in Tax liability of any
    Bison Subsidiaries for which Holdings would be liable under this Section
    5.8, (A) Holdings may participate in the conduct of such audit or proceeding
    at its own expense and (B) Parent shall not settle any such audit or
    proceeding without the consent of Holdings, which consent shall not be
    unreasonably withheld.</p>
    <p>(iii) <u>Control of Contests Involving Post&#45;Closing Periods</u>.
    In the case of an audit or administrative or judicial proceeding involving
    any asserted liability for Taxes relating to any taxable years or periods
    beginning after the Closing Date, Holdings shall have the right, at its
    expense, to control the conduct of such audit or proceeding; <u>provided</u>,
    <u>however</u>, that if such audit or proceeding would be reasonably
    expected to result in a material increase in Tax liability of any Bison
    Subsidiaries for which Parent would be liable under this Section 5.8, (A)
    Parent may participate in the conduct of such audit or proceeding at its own
    expense and (B) Holdings shall not settle any such audit or proceeding
    without the consent of Parent, which consent shall not be unreasonably
    withheld.</p>
    <font FACE="Courier New">
    </blockquote>
  </blockquote>
</font>
<p>(l) As of the Closing Date, Parent shall cause all Tax sharing, Tax
allocation, or Tax indemnity agreements between Parent or any Non&#45;Bison
Subsidiary on the one hand, and any Bison Subsidiary on the other hand, to be
terminated.</p>
<p>(m) During the period through and including the Closing Date, Parent shall,
and shall cause its Affiliates to, have no arrangement, contract or
understanding with respect to the transfer or other disposition by Parent or any
of its Affiliates of the Equity Consideration or any portion thereof.</p>
<font COLOR="#ff0000">
<p>5.9 </font><u><a NAME="_Toc532024512">Bison Financial Statements</a></p>
</u>
<p>.</p>
<p>(a) Parent shall deliver to C&A Products and Holdings, at
Parent&#39;s expense:</p>
<blockquote>
  <blockquote>
    <p>(i) statements of financial position with respect to the Business as at
    December 30, 2000 and January 1, 2000, and statements of income, cash flows
    and changes in net worth for each of the fiscal years ended December 30,
    2000, January 1, 2000 and January 2, 1999, together with an audit report of
    E&Y thereon prepared in accordance with the accounting requirements and
    the published rules and regulations of the SEC applicable to a registration
    statement relating to an offering of debt securities, which report for the
    fiscal year 2000 will be substantially to the effect of E&Y&#39;s
    report relating to the Statement of Net Assets to be Sold at December 30,
    2000 dated February 28, 2001, adapted as appropriate for inclusion of a
    statement of income and cash flows and as otherwise appropriate for its
    purpose; and</p>
    <p>(ii) an unaudited statement of financial position for the interim period
    ended June 30, 2001 and unaudited statements of income and cash flows for
    the interim period ended June 30, 2001 and the corresponding period in 2000,
    in each case prepared in accordance with GAAP consistently applied for the
    periods presented and with the accounting requirements and the published
    rules and regulations of the SEC applicable to a registration statement
    relating to an offering of debt securities, <u>provided</u>, <u>however</u>,
    that if the Closing occurs on or after November 15, 2001, Parent shall
    deliver to C&A Products and Holdings not later than November 28, 2001
    comparable financial statements for the interim period ended September 30,
    2001 and the corresponding period in 2000.</p>
    <font FACE="Courier New">
    </blockquote>
  </blockquote>
</font>
<p>(b) Parent shall deliver to C&A Products and Holdings a summary of
financial information in the form set forth in Section 5.9(b) of the Disclosure
Schedule for each fiscal month beginning immediately after the last quarterly
statement provided pursuant to Section 5.9(a) and ending with the fiscal month
which ends at least thirty days prior to the Closing Date, and the summary shall
be delivered within 28 days after the end of said month.</p>
<p>The financial statements required by this Section 5.9 are referred to herein
as the &quot;Required Financial Statements&quot;.</p>
<p>(c) E&Y and Parent shall provide to Holdings and C&A and its auditors
reasonable cooperation in the preparation of such pro forma financial
information as may be required for the financing of the Transactions on the
basis contemplated hereby.</p>
<font COLOR="#ff0000">
<p>5.10 </font><u><a NAME="_Toc532024513">Observer Rights</a></p>
</u>
<p>. For so long as Parent or its Affiliates hold any shares of the Preferred
Stock issued pursuant to this Agreement, Parent shall have the right to
designate two representatives to serve as observers on the Board of Directors of
C&A Products. Such observers shall have the right to receive all notices and
meeting materials provided to members of the Board of Directors of C&A
Products and committees of the Board of Directors of C&A Products and to
attend and participate in all meetings of the Board of Directors of C&A
Products and meetings of committees of the Board of Directors of C&A
Products.</p>
<font COLOR="#ff0000">
<p>5.11 </font><u><a NAME="_Toc532024514">Non&#45;Competition</a></p>
</u>
<p>.</p>
<p>(a) Prior to the third anniversary of the Closing Date, the Parent Entities
shall not engage in the business of (i) manufacturing or selling overhead
systems, headliners, interior instrument panels, interior quarter panel/sidewall
trim, interior trim consoles, lift&#45;gate trim panels, painted or
unpainted fascia and bumpers, claddings/exterior trim moldings, exterior
grilles, structural composite bumpers, or signal, taillight and other lighting
or (ii) assembling or selling cockpit systems or front&#45;end modules, in
each case as currently manufactured, assembled or sold by the Bison Subsidiaries
and in each case for use in automotive passenger cars and light and heavy trucks
(the &quot;Restricted Field&quot;). For the avoidance of doubt, the continued
operation of the existing businesses of Parent and the Non&#45;Bison
Subsidiaries and the continued ownership by Parent or one or more of its
Affiliates of a direct or indirect equity interest in THI and its Subsidiaries
shall not be a violation of this Section 5.11(a). Notwithstanding anything to
the contrary contained herein, if C&A Products or any of its Subsidiaries
default under any of the Leasing Documents and Parent or any of its Affiliates
continue to own any interest in the Equipment (as defined in the Equipment Lease
Term Sheet attached hereto as Exhibit 12) subject thereto, then the Parent
Entities (and all Affiliates of Parent) shall be permitted to use such Equipment
(whether or not in the Restricted Field) and lease, license, sell or otherwise
transfer (whether or not for use in the Restricted Field) all or any part of
their respective right, title and interest in and to such Equipment to any third
party.</p>
<p>(b) Notwithstanding the foregoing, the Parent Entities may acquire, directly
or indirectly, all or substantially all of the capital stock or assets of any
Person (an &quot;After&#45;Acquired Business&quot;) which derives 33% or
less of its gross sales revenues from the Restricted Field, if Parent or such
Parent Entity promptly grants to Holdings an option to acquire the portion of
the After&#45;Acquired Business which engages in the Restricted Field (the
&quot;Restricted Portion&quot;) upon the terms and conditions set forth in this
Section 5.11(b) and promptly gives notice to Holdings of such option (but in no
event later than the date the After&#45;Acquired Business was acquired). The
purchase price for the Restricted Portion shall be an amount equal to the
aggregate purchase price, including any liabilities assumed by a Parent Entity,
paid by a Parent Entity for the After&#45;Acquired Business, multiplied by a
fraction, the numerator of which shall be the net operating profit or other
mutually acceptable measure of value of the Restricted Portion during the most
recently completed fiscal year prior to the date such Parent Entity acquired the
After&#45;Acquired Business and the denominator of which shall be the net
operating profit or other mutually acceptable measure of value of the
After&#45;Acquired Business during the same period.</p>
<blockquote>
  <blockquote>
    <p>(i) The purchase of the Restricted Portion by Holdings will be subject to
    the execution by the Parent Entity and Holdings of a mutually satisfactory
    definitive agreement for such purchase and the obtaining of all necessary
    regulatory approvals from any Governmental Authority and material third
    party Consents (in each case at no out&#45;of&#45;pocket cost or
    expense to the Parent Entity) and the expiration or termination of any
    applicable waiting period under the HSR Act and any applicable Foreign
    Competition Laws. The Parent Entity&#39;s representations and warranties
    in the definitive purchase agreement for the Restricted Portion shall be
    limited to reasonable assurances that the applicable Parent Entity had
    caused the Restricted Portion to be operated in the ordinary course of
    business during the period of such Parent Entity&#39;s ownership, and
    the Parent Entity shall use all commercially reasonable efforts to cause its
    rights under the purchase agreement by which it acquired the
    After&#45;Acquired Business to the extent relating to the Restricted
    Portion to be assigned or otherwise made available to Holdings. The
    definitive purchase agreement shall provide that such agreement may be
    terminated at the option of either a Parent Entity (or the applicable
    Non&#45;Bison Subsidiary) or Holdings if such transaction is not
    consummated by the six month anniversary of the date the
    After&#45;Acquired Business was acquired by a Parent Entity.</p>
    <p>(ii) If Holdings fails to give Parent notice of its intent to exercise
    this option on or before the one month anniversary of the date the
    After&#45;Acquired Business was acquired or the sale of the Restricted
    Portion to Holdings is not consummated, other than because of a default by a
    Parent Entity, the Parent Entity may retain ownership of the
    After&#45;Acquired Business, including the Restricted Portion.</p>
  </blockquote>
</blockquote>
<font COLOR="#ff0000">
<p>5.12 <a NAME="_Toc503342998"></a><a NAME="_Toc503343099"></a><a NAME="_Toc503343344"></a></font><u><a NAME="_Toc532024515">Intercompany
Transactions</a></p>
</u>
<p>. Intercompany transactions shall be treated in accordance with the
Transition Agreement.</p>
<font COLOR="#ff0000">
<p>5.13 </font><a NAME="_Toc532024516"><u>Additional Covenant of C&A and
Holdings</u>.</a><a NAME="_Toc518733054"></a></p>
<p>Neither Holdings nor C&A Products shall amend or cause to be amended any
of the Commitment Letters (except to add new lenders) without the prior written
consent of Parent, which consent shall not be unreasonably withheld, conditioned
or delayed.</p>
<font COLOR="#ff0000">
<p>5.14 </font><u><a NAME="_Toc532024517">Certain Pre&#45;Closing
Restrictions</a></p>
</u>
<p>. Prior to the Closing, Products will comply with the following provisions of
the Certificate of Designation as though in effect on the date hereof:</p>
<p>(a) Section 7(c), provided that the term &quot;Issuance Date of the Series A1
Redeemable Preferred Stock, the Series B1 Redeemable Preferred Stock and the
Series C1 Redeemable Preferred Stock&quot; shall be deemed to refer to the date
of this Purchase Agreement;</p>
<p>(b) Section 7(f), provided that the consent of Textron and its Subsidiaries
shall be required to the extent stated therein notwithstanding the Preferred
Stock has not been issued and in no event shall such provisions prevent any of
the Transactions and related matters, including but not limited to any payments
pursuant to the Advisory Agreement (as defined in the Certificate of
Designation) as amended through the date of the Closing;</p>
<p>(c) Section 7(h); and</p>
<p>(d) Section 7(b), provided that (i) the term &quot;Restricted Payments&quot;
shall only include Restricted Payments of a type described in clauses (i) and
(ii), (ii) clause (b) of the first paragraph thereof shall be that ratio
referred to in the footnote to Section 7(a), (iii) the exceptions in the second
paragraph of Section 7(b) shall be construed to include those exceptions in
C&A Products&#39; existing 11&#45;1/2% Senior Subordinated Notes due
2006 in any case in which there is a blank or bracketed amount and (iv) insofar
as Restricted Payments of the type referred to in clause (iii) of the term
&quot;Restricted Payments&quot; is concerned, C&A Products will abide by the
provisions applicable to such types of Restricted Payments in its existing
11&#45;1/2% Senior Subordinated Notes due 2006.</p>
<font COLOR="#ff0000">
<p>5.15 </font><u><a NAME="_Toc532024518">Closing Date Indebtedness</a></p>
</u>
<p>. On or prior to the Closing Date, Parent shall provide to Holdings and
C&A Products a schedule listing total Indebtedness of the Bison Subsidiaries
(after giving effect to the Restructuring and excluding intercompany accounts
that have been settled prior to Closing), separated into the categories
&quot;a&quot; through &quot;g&quot; contained in the definition of Indebtedness,
as of the Closing Date.</p>
<font COLOR="#ff0000">
<p>5.16 </font><u><a NAME="_Toc532024519">Tax Reporting</a></p>
</u>
<p>.</p>
<p>(a) Holdings, C&A Products and Parent shall classify the Preferred Stock
as equity for tax purposes and shall not take any position inconsistent with
such classification.</p>
<p>(b) Parent, Holdings and C&A Products shall take the position that there
will not be any constructive distributions (or series of constructive
distributions) with respect to the Preferred Stock under Section 305 of the Code
or the Treasury Department regulations promulgated thereunder (&quot;Tax
Law&quot;). None of Parent, Holdings or C&A Products shall take any position
inconsistent with such position; <u>provided</u>, <u>however</u>, that if
Parent, Holdings or C&A Products determines that under then applicable Tax
Law the parties may be required to take a position inconsistent with that set
forth in this Section 5.16(b), the party making such determination (the
&quot;Requesting Party&quot;) shall notify the other parties of such
determination and, if the other parties do not agree that the parties will be
required under then applicable Tax Law to take a position inconsistent with the
position set forth in this Section 5.16(b), Parent, Holdings and C&A
Products shall retain a mutually agreed upon nationally recognized tax counsel
to advise the parties as to whether they will be required under then applicable
Tax Law to take a position inconsistent with the position set forth in this
Section 5.16(b). In the event that the parties agree, or the mutually agreed
upon nationally recognized tax counsel determines, that the parties will be
required under then applicable Tax Law to take a position inconsistent with the
position set forth in this Section 5.16(b), then the parties shall take the
position so agreed upon or determined. All costs and expenses of the mutually
agreed upon nationally recognized tax counsel relating to such advice shall be
borne equally by Parent and Holdings; <u>provided</u>, <u>however</u>, that if
the mutually agreed upon nationally recognized tax counsel determines that the
parties will not be required under then applicable Tax Law to take a position
inconsistent with the position set forth in this Section 5.16(b), then all such
costs and expenses shall be borne by the Requesting Party.</p>
<font COLOR="#ff0000">
<p>5.17 </font><a NAME="_Toc532024520"><u>R&D Employees</u>.</a></p>
<p>Persons whose activities prior to the date hereof related primarily to
research and development and product development related to the Business shall
not be continuously employed by Parent or a Subsidiary of Parent after the
Closing. For a period of two years from the date of this Agreement, Parent and
its Affiliates shall not, without the written consent of C&A Products,
solicit for employment any Transferred Employee whose activities prior to the
date hereof related primarily to research and development or product
development. This non&#45;solicitation covenant shall not apply to general
advertisements for available employment positions.</p>
<font COLOR="#ff0000">
<p>5.18 </font><u><a NAME="_Toc532024521">IRB</a></p>
</u>
<p>. On or prior to the Closing, Holdings shall either (i) cause the
Indebtedness under the Loan Agreement dated as of August 1, 1991 between C&A
Products (formerly Collins & Aikman Corporation) and the Michigan Strategic
Fund (the &quot;Loan Agreement&quot;) to be completely paid and retired and
terminate all obligations under the Loan Agreement and the Reimbursement
Agreement dated as of August 1, 1991 between C&A Products (formerly Collins
& Aikman Corporation and NBD Bank, N.A.) (the &quot;Reimbursement
Agreement&quot;) or (ii) obtain amendments to or waivers of any terms of the
Reimbursement Agreement, the Loan Agreement and any other Contract relating
thereto such that the Reimbursement Agreement, the Loan Agreement and the
related Contracts will not in any manner adversely affect the ability of C&A
Products to pay dividends on or redeem (other than redemptions solely at the
option of C&A Products) the Preferred Stock or adversely affect the ability
of Holdings or C&A Products to complete the transactions contemplated by the
Transaction Agreements or the Commitment Letters.</p>
<font COLOR="#ff0000">
<p>5.19 </font><a NAME="_Toc532024522">[<u>Reserved</u>.]</a></p>
<font FACE="Courier New">
<p>&nbsp;</p>
</font><font COLOR="#ff0000">
<p>5.20 </font><u><a NAME="_Toc532024523">Textron Automotive Holdings Italy</a></p>
</u>
<p>.</p>
<p>(a) It is the intention of the parties that from and after the Closing,
Textron Automotive Company Italia S.r.l. (the &quot;Italian Opco&quot;) will be
a wholly owned subsidiary of THI and that THI will be operated as a joint
venture between one or more Subsidiaries of Parent and a Subsidiary of Holdings.
Prior to the Closing, Parent will use commercially reasonable best efforts to
cause THI to purchase all of the shares of capital stock of the Italian Opco
owned by Magneti Marelli Holding S.p.A.</p>
<p>(b) Subject to Section 2.6(b), on the Closing Date, with effect from and
after the Closing Date, the following documents shall be executed and delivered
by the applicable parties: (i) the Joint Venture and Shareholders Agreement
among the shareholders of THI (after giving effect to the Closing) substantially
in the form of Exhibit 8 to this Agreement; (ii) an Administrative Services
Agreement between THI and C&A Products substantially in the form of Exhibit
9 to this Agreement; (iii) a License and Technical Assistance Agreement between
THI and C&A Products substantially in the form of Exhibit 10 to this
Agreement; and (iv) an Engineering Services Agreement between THI and C&A
Products substantially in the form of Exhibit 11 to this Agreement
(collectively, the &quot;Italian JV Documents&quot;).</p>
<p>(c) Thirty days after delivery of a written request by Parent that Holdings
purchase the THI Shares owned by Parent and its Subsidiaries that represent 50%
of the total number of THI Shares outstanding as of the Closing Date (the
&quot;Put Notice&quot;), which request may be delivered any time after the third
anniversary of the Closing Date, C&A Products shall purchase said THI Shares
for a purchase price of twenty&#45;three million one hundred forty thousand
dollars ($23,140,000), less any amount received in respect of such THI Shares
after the Closing Date from any liquidation or other distribution, dividend or
payment to Parent or one of its Subsidiaries (other than distributions,
dividends or payments made for the purpose of payment of Taxes); <u>provided</u>,
that if Fiat Auto S.p.A. has not implemented a slow&#45;pay payables policy
within 180 days after the Closing Date, then C&A Products shall purchase
said THI Shares for a purchase price of twenty&#45;eight million one hundred
forty thousand dollars ($28,140,000), less any amount received in respect of
such THI Shares after the Closing Date from any liquidation or other
distribution, dividend or payment to Parent or one of its Subsidiaries (other
than distributions, dividends or payments made for the purpose of payment of
Taxes). C&A Products shall not directly or indirectly request, encourage or
facilitate the implementation of a slow&#45;pay payables policy by Fiat Auto
S.p.A., and shall promptly notify Parent in the event any such policy is
implemented. The rights of Parent under this Section 5.20(c) shall not be
assignable to any other Person, except an Affiliate of Parent.</p>
<p>(d) If Parent does not deliver a Put Notice pursuant to Section 5.20(c)
within ninety days after the third anniversary of the Closing Date, all excess
cash not required for the normal operations and debt service of THI and its
Subsidiaries shall be swept out of THI and its Subsidiaries from time to time
and paid over to C&A Products in exchange for a promise to repay as
described in the Joint Venture and Shareholders Agreement attached hereto as
Exhibit 8. Parent shall, and shall cause its Subsidiaries to, from time to time
take any and all action, including to cause its or their THI director designees
to take any and all action, necessary to permit such payment to C&A Products
consistent with Italian law.</p>
<p>(e) At any time after the third anniversary of the Closing Date, Holdings, by
written notice delivered to Parent (the &quot;Call Notice&quot;), may require
that Parent and its Subsidiaries sell all (but not less than all) of the THI
Shares owned by Parent and its Subsidiaries to Holdings, or a Subsidiary of
Holdings, for a total price equal to the fair market value of 100% of the total
THI Shares outstanding (the &quot;Fair Market Value&quot;) multiplied by a
fraction whose numerator is the number of THI Shares owned by Parent and its
Subsidiaries and whose denominator is the total number of THI Shares
outstanding; <u>provided</u>, <u>however</u>, that neither Parent and its
Subsidiaries shall be obligated to sell its THI Shares pursuant to the Call
Notice if it delivers a Put Notice to Holdings pursuant to Section 5.20(c)
within twenty days after receiving a Call Notice; <u>provided</u> <u>further</u>,
<u>however</u>, that the rights of Holdings under this Section 5.20(e) shall not
be assignable to any other Person by Holdings other than as collateral security
for the borrowings described in the Debt Commitment Letter and except to an
Affiliate of Holdings. Fair Market Value shall be that which a willing buyer and
a willing seller, under no economic compulsion to buy or sell and without regard
to any existing position in THI, would be willing to pay in cash to acquire the
subject THI Shares and shall be determined in good faith by Holdings and
specified in the Call Notice delivered to Parent.</p>
<p>(f) The shareholders in THI will cooperate to ensure that all information
regarding THI necessary to enable THI and its Subsidiaries to timely prepare
their Tax Returns is available, if within their respective abilities to do so.</p>
<p>(g) The shareholders in THI will cooperate to ensure that THI provides its
shareholders all information regarding THI necessary to enable its shareholders
to timely prepare and file any Tax Returns.</p>
<p>(h) Any of the rights to purchase THI Shares, whether upon exercise of the
put or the call provisions, may be assigned to an Affiliate of C&A Products,
without relieving C&A Products of its obligations under these provisions.</p>
<font COLOR="#ff0000">
<p>5.21 </font><a NAME="_Toc532024524"><u>Property Lease</u>.</a></p>
<font FACE="Courier New">
<p>&nbsp;</p>
</font>
<p>(a) On or prior to the Closing Date, Parent agrees to cause the sale of
equipment to Textron Financial Corporation or one of its Affiliates for the
purposes of the transactions described in the terms sheets attached hereto as
Exhibit 12, and immediately thereafter cause the Subsidiary which sold the
assets to enter into a lease with Textron Financial Corporation or one of its
Affiliates on terms consistent with Exhibit&#160;12. To the extent that the
leverage ratio (as determined under the definitive financing documentation for
the debt financing of the Transactions, assuming EBITDA of $377.1 million)
exceeds 3.82:1.00 on or shortly prior to the Closing Date, the parties will use
their commercially reasonable best efforts to cause additional property and/or
equipment of Parent or its Subsidiaries to be made subject to the described
leasing transactions for the purpose of reducing the requisite debt financing so
as to comply with such ratio as a condition precedent set forth in the Debt
Commitment Letters. It is agreed that in no event shall the fair market value of
the property or the equipment subject to the leasing transactions be less than
eighty six million nine hundred thousand dollars ($86,900,000). The documents
required to be executed to consummate the transactions referred to in the
attached term sheets on the terms described therein are referred to as the
&quot;Leasing Documents.&quot;</p>
<p>(b) C&A Products will use commercially reasonable efforts to locate a
third party to purchase the property subject to the Leasing Documents from
Textron Financial Corporation, or, if unsuccessful, obtain funding to enable
C&A Products to purchase said property on or prior to the second anniversary
of the Closing Date. Such sale may (but need not be) effected subject to the
Leasing Documents or new leasing documentation may be entered into by C&A
Products and its Subsidiaries with the new owner. Nothing herein shall be
construed as requiring that C&A Products is obligated to purchase any such
property.</p>
<font COLOR="#ff0000">
<p>5.22 </font><a NAME="_Toc532024525"><u>Reduction in Workforce Charges</u>.</a></p>
<font FACE="Courier New">
<p>&nbsp;</p>
</font>
<p>(a) To the extent that C&A Products, or its applicable Subsidiaries, make
cash severance and termination payments (including payments relating to salary,
Taxes and healthcare) on behalf of Parent, in amounts established by Parent, to
the individuals listed in Schedule H hereto solely as a result of actions taken
by Parent in the fiscal quarter ended March 31, 2001 in connection with a
reduction in workforce, Parent shall reimburse C&A Products, or its
applicable Subsidiaries, for the cost of such payments. Parent represents and
warrants that the individuals listed in Schedule H are the only individuals to
whom Parent is obligated to make such cash severance and termination payments
after the date of the amendment and restatement of this Agreement. The foregoing
representation and warranty shall survive until the third anniversary of the
Closing Date and shall not be subject to the limitations of liability set forth
in Article VIII. Neither C&A Products nor its Subsidiaries shall claim any
Tax deduction with respect to any payments made pursuant to this Section 5.22(a)
unless it is required by the relevant Tax Authority to treat the reimbursement
as income.</p>
<p>(b) Prior to the Closing Date, Parent will terminate the employment of
approximately 225 employees of the Business with the goal of achieving savings
of approximately $18.8 million during the period January 1, 2002 through
December 31, 2002 based on current production levels. To the extent that C&A
Products, or its applicable Subsidiaries, make payments on behalf of Parent for
cash severance and termination payments, in amounts established by Parent, to,
or for the benefit of, the terminated employees solely as a result of
Parent&#39;s actions prior to the Closing Date, Parent shall reimburse
C&A Products, or its applicable Subsidiaries, for the cost of such payments.
Neither C&A Products nor its applicable Subsidiaries shall claim any Tax
deduction with respect to any payments made pursuant to this Section 5.22(b)
unless it is required by the relevant Tax Authority to treat the reimbursement
as income. C&A Products, or its applicable Subsidiaries, shall reasonably
promptly provide Parent all information necessary for Parent to satisfy any
applicable information reporting obligations with respect to such payments.
Except for the cash severance and termination payments referred to in this
Section 5.22(b). C&A Products shall be solely liable for all Losses relating
to any Claim or liability arising out of the employment of the 225 employees
terminated by Parent pursuant to this section which are payable after the
Closing.</p>
<font COLOR="#ff0000">
<p>5.23 </font><u><a NAME="_Toc532024526">Board of Directors</a></p>
</u>
<p>.</p>
<p>(a) Parent shall be entitled to designate at any time and from time to time
(i) one member (the &quot;Textron Designee&quot;) to serve as a director on the
Board of Directors of Holdings (the &quot;Holdings Board&quot;) and (ii) two
representatives to serve as observers on the Holdings Board, in each case until
the Director Termination Date. Parent shall, from time to time, deliver to the
Secretary of Holdings a notice stating the names of the Textron Designee and the
representatives that will serve as observers on the Holdings Board.</p>
<p>(b) The Holdings Board shall elect the Textron Designee to the Holdings Board
within 30 days after receiving the name of such Textron Designee from Parent. In
connection with any meeting of the stockholders of Holdings at which members of
the Holdings Board are to be elected and at which the term of the Textron
Designee expires, the Holdings Board, or the applicable committee, shall
nominate and recommend to its stockholders the Textron Designee. In the event
that the Textron Designee dies, retires, resigns or is otherwise removed from
the Holdings Board, the Holdings Board shall elect as a replacement a new
Textron Designee designated by Parent in the manner set forth in Section
5.23(a).</p>
<p>(c) The observers and any replacements, shall have the right to attend all
meetings of the Holdings Board, including meetings held between members of the
Holdings Board who are not officers of Holdings or a Subsidiary of Holdings, to
receive all notices and meeting materials provided to members of the Holdings
Board and committees of the Holdings Board and to attend and participate in all
meetings of the Holdings Board and meetings of the committees of the Holdings
Board.</p>
<font COLOR="#ff0000">
<p>5.24 </font><u><a NAME="_Toc532024527">Financing Discussions</a></p>
</u>
<p>. Prior to the Closing Date, Parent or its designee shall participate in all
significant discussions and negotiations with any of the Initial Lenders, as
defined in the Debt Commitment Letter, which relate to the Preferred Stock or
which directly relate to the earn&#45;out specified in Section&#160;2.8.</p>
<font COLOR="#ff0000">
<p ALIGN="CENTER">ARTICLE VI<a NAME="_Toc503343100"></a><a NAME="_Toc503343345"></a></font><br>
<br>
<a NAME="_Toc503342999"></a><a NAME="_Toc503343949"></a><a NAME="_Toc503667930"></a><a NAME="_Toc503684861"></a><a NAME="_Toc504459553"></a><a NAME="_Toc505070816"></a><a NAME="_Toc505137412"></a><a NAME="_Toc505767659"></a><a NAME="_Toc506346230"></a><a NAME="_Toc506628548"></a><a NAME="_Toc506775358"></a><a NAME="_Toc507592226"></a><a NAME="_Toc508437303"></a><a NAME="_Toc508709248"></a><a NAME="_Toc514732034"></a><a NAME="_Toc514732772"></a><a NAME="_Toc516456615"></a><a NAME="_Toc516460975"></a><a NAME="_Toc516463391"></a><a NAME="_Toc516560576"></a><a NAME="_Toc518363269"></a><a NAME="_Toc518466850"></a><a NAME="_Toc518733404"></a><a NAME="_Toc518733498"></a><a NAME="_Toc519520867"></a><a NAME="_Toc519701043"></a><a NAME="_Toc520104890"></a><a NAME="_Toc520108744"></a><a NAME="_Toc520261552"></a><a NAME="_Toc520609481"></a><a NAME="_Toc521132978"></a><a NAME="_Toc521305001"></a><a NAME="_Toc521330778"></a><a NAME="_Toc521426491"></a><a NAME="_Toc521468890"></a><a NAME="_Toc521492941"></a><a NAME="_Toc52
9701283"></a><a NAME="_Toc529706222"></a><a NAME="_Toc529947411"></a><a NAME="_Toc530205131"></a><a NAME="_Toc530215737"></a><a NAME="_Toc530801295"></a><a NAME="_Toc531699889"></a><a NAME="_Toc531774277"></a><a NAME="_Toc531805691"></a><a NAME="_Toc532024528">CONDITIONS
TO CONSUMMATION OF THE TRANSACTION</a></p>
<p ALIGN="CENTER">&nbsp;</p>
<p>&nbsp;</p>
<font COLOR="#ff0000">
<p>6.1 <a NAME="_Toc503343000"></a><a NAME="_Toc503343101"></a><a NAME="_Toc503343346"></a><a NAME="_Toc508437304"></a></font><a NAME="_Toc532024529"><u>Conditions
to Each Party&#39;s Obligations to Complete the Transactions</u>.</a></p>
<p>The respective obligations of each party to complete the Transactions are
subject to the satisfaction at or prior to the Closing Date of the following
conditions:</p>
<p>(a) <u>Injunction</u>. There shall not be in effect any Law or Order of any
Governmental Authority of competent jurisdiction directing that the Transactions
not be consummated as provided herein.</p>
<p>(b) <u>Governmental Filings and Consents</u>. The regulatory approvals listed
in Section 6.1(b) of the Disclosure Schedule shall have been obtained and be in
effect as of the Closing Date, and the waiting period under HSR Act shall have
expired or early termination thereof shall have been granted.</p>
<p>(c) <u>Works Councils</u>. All required notices to any works council,
personnel committee or similar employee council or committee shall have been
made, and any required consultation with any works council, personnel committee
or similar employee council or committee shall have occurred.</p>
<p>(d) <u>Restructuring</u>. Parent shall have completed the Restructuring in
all material respects.</p>
<font COLOR="#ff0000">
<p>6.2 <a NAME="_Toc503343001"></a><a NAME="_Toc503343102"></a><a NAME="_Toc503343347"></a><a NAME="_Toc508437305"></a></font><u><a NAME="_Toc532024530">Additional
Conditions to the Obligation of Holdings and C&A Products</a></p>
</u>
<p>. The obligation of Holdings and C&A Products to complete the
Transactions is subject to the satisfaction at or prior to the Closing Date of
the following conditions, any and all of which may be waived in whole or in part
by Holdings to the extent permitted by applicable Law:</p>
<p>(a) <u>Representations and Warranties</u>. The representations and warranties
of Parent contained in this Agreement shall be true and correct on the date of
this Agreement and on the Closing Date as though made on and as of the Closing
Date (except to the extent that a representation or warranty expressly speaks as
of a specified date or period of time); <u>provided</u>, <u>however</u>, that
for purposes of this Section 6.2(a), such representations and warranties shall
be deemed to be true and correct unless the failure or failures of such
representations and warranties to be so true and correct, without regard to any
materiality or Material Adverse Effect qualifiers contained therein,
individually or in the aggregate, results or would reasonably be likely to
result in a Material Adverse Effect.</p>
<p>(b) <u>Performance</u>. Parent shall have performed in all material respects
all of its covenants and agreements under this Agreement to be performed or
complied with on or prior to the Closing Date; <u>provided</u> that Parent shall
be provided the opportunity to cure any failure to so perform or comply, if a
cure is possible, within a reasonable time after receiving written notice of
such failure from Holdings.</p>
<p>(c) <u>Officer&#39;s Certificate</u>. Holdings shall have received on the
Closing Date a certificate dated the Closing Date and executed by the Chief
Operating Officer or the Chief Financial Officer of Parent certifying to the
fulfillment of the conditions specified in Sections 6.1(d), 6.2(a) and 6.2(b).</p>
<p>(d) <u>Bison Financial Statements</u>. Parent shall have delivered the
Required Financial Statements pursuant to Section 5.9.</p>
<p>(e) <u>Agreements</u>. Parent and its Subsidiaries (to the extent each is a
party thereto) shall have executed the License Agreements attached hereto as
Exhibits 3A, 3B and 3C, the Assignment and Assumption Agreement attached hereto
as Exhibit 2, the Registration Rights Agreements attached hereto as Exhibits 5
and 6 and the Transition Agreement attached hereto as Exhibit 4.</p>
<p>(f) <u>Financing</u>. The financing contemplated by the Debt Commitment
Letter shall have been completed on substantially the terms and conditions
identified in such Debt Commitment Letter or on such other terms and conditions
or involving such other financing sources, as are not materially more onerous in
the aggregate to Holdings and C&A Products than those in the applicable Debt
Commitment Letter and on other reasonable and customary terms (but not requiring
more equity financing than is contemplated by the Debt Commitment Letter); <u>provided</u>,
that this condition shall be deemed satisfied if the failure of this condition
is due to a breach by Holdings, C&A Products, Heartland or any of their
respective Affiliates of any covenant contained in any Financing Agreement,
except if any such breach would not occur but for a breach by Parent or any of
its Affiliates of any of its covenants, representations or warranties contained
herein or a failure of Parent or any of its Affiliates to comply with a
reasonable request of Holdings in respect of the financing contemplated by the
Debt Commitment Letter or an adverse change in the business, operations, assets,
financial condition, contingent liabilities or material agreements of the
Business or the Bison Subsidiaries.</p>
<p>(g) <u>Italian JV Documents</u>. The Italian JV Documents shall have been
duly executed and delivered by each applicable Subsidiary of Parent.</p>
<p>(h) <u>Leasing Documents</u>. Each of the Leasing Documents shall have been
duly executed and delivered by each applicable Subsidiary of Parent.</p>
<p>(i) <u>Magneti Marelli Holding S.p.A.</u> At or prior to Closing, Parent
shall have either (y) caused THI to purchase all of the shares of capital stock
of the Italian Opco owned by Magneti Marelli Holding S.p.A. or (z) obtained the
irrevocable consent of Magneti Marelli Holding S.p.A. to the transactions
contemplated by Section 5.20 of this Agreement.</p>
<font COLOR="#ff0000">
<p>6.3 <a NAME="_Toc503343002"></a><a NAME="_Toc503343103"></a><a NAME="_Toc503343348"></a><a NAME="_Toc508437306"></a></font><a NAME="_Toc532024531"><u>Additional
Conditions to the Obligation of Parent</u>.</a></p>
<p>The obligation of Parent to complete the Transactions is subject to the
satisfaction at or prior to the Closing Date of the following conditions, any
and all of which may be waived in whole or in part by Parent to the extent
permitted by applicable Law:</p>
<p>(a) <u>Representations and Warranties</u>. The representations and warranties
of Holdings and C&A Products contained in this Agreement shall be true and
correct on the date of this Agreement and on the Closing Date as though made on
and as of the Closing Date (except to the extent that a representation or
warranty expressly speaks as of a specified date or period of time); <u>provided</u>,
<u>however</u>, that for purposes of this Section 6.3(a), such representations
and warranties shall be deemed to be true and correct unless the failure or
failures of such representations and warranties to be so true and correct,
without regard to any materiality or Holdings Material Adverse Effect qualifiers
contained therein, individually or in the aggregate, results or would reasonably
be likely to result in a Material Adverse Effect.</p>
<p>(b) <u>Performance</u>. Holdings shall have performed in all material
respects its covenants and agreements under this Agreement to be performed or
complied with on or prior to the Closing Date; <u>provided</u> that Holdings
shall be provided the opportunity to cure any failure to so perform or comply,
if a cure is possible, within a reasonable time after receiving written notice
of such failure from Parent.</p>
<p>(c) <u>Officer&#39;s Certificate</u>. Parent shall have received on the
Closing Date a certificate dated the Closing Date and executed by the Chief
Operating Officer or the Chief Financial Officer of Holdings certifying to the
fulfillment of the conditions specified in Sections 6.3(a) and (b) hereof.</p>
<p>(d) <u>Agreements</u>. Holdings and C&A Products shall have executed the
License Agreements attached hereto as Exhibits 3A, 3B and 3C, the Assignment and
Assumption Agreement attached hereto as Exhibit 2, the Registration Rights
Agreements attached hereto as Exhibits 5 and 6 and the Transition Agreement
attached hereto as Exhibit 4.</p>
<p>(e) <u>Certificate of Designation</u>. The Certificate of Designation shall
have been duly filed with the Secretary of State of the State of Delaware, shall
be in full force and effect and shall not have been amended or modified.</p>
<p>(f) <u>Italian JV Documents</u>. The Italian JV Documents shall have been
duly executed and delivered by each applicable Subsidiary of C&A Products.</p>
<p>(g) <u>Leasing Documents Guarantee</u>. The guarantee required by Exhibit 12
shall have been duly executed and delivered by C&A Products.</p>
<font COLOR="#ff0000">
<p ALIGN="CENTER">ARTICLE VII<a NAME="_Toc503343104"></a><a NAME="_Toc503343349"></a></font><br>
<br>
<a NAME="_Toc503343003"></a><a NAME="_Toc503343953"></a><a NAME="_Toc503667934"></a><a NAME="_Toc503684865"></a><a NAME="_Toc504459557"></a><a NAME="_Toc505070820"></a><a NAME="_Toc505137416"></a><a NAME="_Toc505767663"></a><a NAME="_Toc506346234"></a><a NAME="_Toc506628552"></a><a NAME="_Toc506775362"></a><a NAME="_Toc507592230"></a><a NAME="_Toc508437307"></a><a NAME="_Toc508709253"></a><a NAME="_Toc514732039"></a><a NAME="_Toc514732777"></a><a NAME="_Toc516456620"></a><a NAME="_Toc516460980"></a><a NAME="_Toc516463396"></a><a NAME="_Toc516560581"></a><a NAME="_Toc518363274"></a><a NAME="_Toc518466855"></a><a NAME="_Toc518733409"></a><a NAME="_Toc518733503"></a><a NAME="_Toc519520871"></a><a NAME="_Toc519701047"></a><a NAME="_Toc520104894"></a><a NAME="_Toc520108748"></a><a NAME="_Toc520261556"></a><a NAME="_Toc520609485"></a><a NAME="_Toc521132982"></a><a NAME="_Toc521305005"></a><a NAME="_Toc521330782"></a><a NAME="_Toc521426495"></a><a NAME="_Toc521468894"></a><a NAME="_Toc521492945"></a><a NAME="_Toc52
9701287"></a><a NAME="_Toc529706226"></a><a NAME="_Toc529947415"></a><a NAME="_Toc530205135"></a><a NAME="_Toc530215741"></a><a NAME="_Toc530801299"></a><a NAME="_Toc531699893"></a><a NAME="_Toc531774281"></a><a NAME="_Toc531805695"></a><a NAME="_Toc532024532">TERMINATION</a></p>
<p ALIGN="CENTER">&nbsp;</p>
<p>&nbsp;</p>
<font COLOR="#ff0000">
<p>7.1 <a NAME="_Toc503343004"></a><a NAME="_Toc503343105"></a><a NAME="_Toc503343350"></a></font><a NAME="_Toc532024533"><u>Termination
by Mutual Consent</u>.</a></p>
<p>This Agreement may be terminated and the Transactions may be abandoned at any
time prior to the Closing Date, by the mutual written consent of Parent and
Holdings.</p>
<font COLOR="#ff0000">
<p>7.2 <a NAME="_Toc503343005"></a><a NAME="_Toc503343106"></a><a NAME="_Toc503343351"></a></font><a NAME="_Toc532024534"><u>Termination
by Any Party</u>.</a></p>
<p>This Agreement may be terminated and the Transactions may be abandoned by any
party hereto by prompt written notice to the others if (a) any court of
competent jurisdiction or other Governmental Authority shall have issued an
Order permanently restraining, enjoining or otherwise prohibiting the
Transactions, and such Order shall have become final and nonappealable; <u>provided</u>,
<u>however</u>, that the party seeking to terminate this Agreement pursuant to
this clause (a) shall have used all commercially reasonable efforts to have such
Order vacated or (b) the Closing shall not have occurred by December 31, 2001; <u>provided</u>,
<u>further</u>, <u>however</u>, that the right to terminate this Agreement
pursuant to this Section 7.2(b) shall not be available to any party whose
failure to fulfill any of its material obligations under this Agreement results
in the failure of the Closing to occur on or prior to such date.</p>
<font COLOR="#ff0000">
<p>7.3 <a NAME="_Toc503343006"></a><a NAME="_Toc503343107"></a><a NAME="_Toc503343352"></a></font><u><a NAME="_Toc532024535">Termination
by Parent</a></p>
</u>
<p>.</p>
<p>(a) This Agreement may be terminated by Parent at any time if (a) any
condition contained in any Commitment Letter shall fail to be satisfied and such
failure is not cured within 30 days of Holdings&#39; or C&A
Products&#39; notice of such failure or (b) one or more of the Commitment
Letters is withdrawn, terminated or revoked; <u>provided</u>, <u>however</u>,
that in the event an Equity Commitment Letter is withdrawn, terminated or
revoked, Holdings and C&A Products shall have 30 days to cause such Equity
Commitment Letter to be reinstated or the commitment covered by said Equity
Commitment Letter replaced by another investor pursuant to a commitment letter
containing the same terms, except for the identity of the parties; <u>provided</u>,
<u>further</u>, however that Parent&#39;s right to terminate this Agreement
pursuant to this Section 7.3 will not be available if Parent fails to fulfill
any of its obligations under this Agreement and such failure results in the
failure of the applicable condition to Closing.</p>
<font COLOR="#ff0000">
<p>7.4 </font><a NAME="_Toc532024536"><u>Effect of Termination</u>.</a></p>
<p>In the event this Agreement is terminated pursuant to this Article VII, the
transactions contemplated hereby shall be abandoned, without further action by
any of the parties hereto, and this Agreement shall become void and have no
further force and effect, except that (i) the obligations of Heartland
Industrial Partners, C&A, Holdings and C&A Products set forth in the
Confidentiality Agreement shall remain in effect, (ii) neither party shall be
relieved from any liabilities or damages arising out of a willful breach of any
provision of this Agreement and (iii) the respective obligations of the parties
set forth in Section 9.3 shall remain in effect.</p>
<font COLOR="#ff0000">
<p ALIGN="CENTER">ARTICLE VIII<a NAME="_Toc503343108"></a><a NAME="_Toc503343353"></a></font><br>
<br>
<a NAME="_Toc503343007"></a><a NAME="_Toc503343957"></a><a NAME="_Toc503667938"></a><a NAME="_Toc503684869"></a><a NAME="_Toc504459561"></a><a NAME="_Toc505070824"></a><a NAME="_Toc505137420"></a><a NAME="_Toc505767667"></a><a NAME="_Toc506346238"></a><a NAME="_Toc506628556"></a><a NAME="_Toc506775366"></a><a NAME="_Toc507592234"></a><a NAME="_Toc508437311"></a><a NAME="_Toc508709257"></a><a NAME="_Toc514732043"></a><a NAME="_Toc514732781"></a><a NAME="_Toc516456624"></a><a NAME="_Toc516460984"></a><a NAME="_Toc516463400"></a><a NAME="_Toc516560585"></a><a NAME="_Toc518363278"></a><a NAME="_Toc518466859"></a><a NAME="_Toc518733508"></a><a NAME="_Toc519520876"></a><a NAME="_Toc519701052"></a><a NAME="_Toc520104899"></a><a NAME="_Toc520108753"></a><a NAME="_Toc520261561"></a><a NAME="_Toc520609490"></a><a NAME="_Toc521132987"></a><a NAME="_Toc521305010"></a><a NAME="_Toc521330787"></a><a NAME="_Toc521426500"></a><a NAME="_Toc521468899"></a><a NAME="_Toc521492950"></a><a NAME="_Toc529701292"></a><a NAME="_Toc52
9706231"></a><a NAME="_Toc529947420"></a><a NAME="_Toc530205140"></a><a NAME="_Toc530215746"></a><a NAME="_Toc530801304"></a><a NAME="_Toc531699898"></a><a NAME="_Toc531774286"></a><a NAME="_Toc531805700"></a><a NAME="_Toc532024537">OBLIGATIONS
AFTER CLOSING</a></p>
<p ALIGN="CENTER">&nbsp;</p>
<p ALIGN="CENTER">&nbsp;</p>
<p>8.1 <a NAME="_Toc503343008"></a><a NAME="_Toc503343109"></a><a NAME="_Toc503343354"></a><a NAME="_Toc508437312"></a><a NAME="_Toc532024538"><u>Survival
of Representations, Warranties and Covenants; Indemnification</u></a>.</p>
<p>(a) <u>Survival</u>. All representations and warranties contained in this
Agreement shall survive until the first anniversary of the Closing Date, except
(i) the representations and warranties contained in Sections 3.2(b) and (c) and
Section 4.4(a) and (b) of this Agreement, which shall survive the Closing and
(ii) the representations and warranties contained in Section 3.8 and Section
3.11, which shall not survive the Closing. This Section 8.1(a) shall not limit
any covenant or agreement of the parties hereto which by its express terms
contemplates performance after the Closing, including Parent&#39;s
indemnification obligations for certain environmental matters and Taxes set
forth in Sections 8.2 and 5.8(i).</p>
<p>(b) <u>Indemnification by Parent</u>. Subject to the other provisions of this
Section 8.1, Parent shall indemnify Holdings, its Subsidiaries and their present
and former directors, officers, employees and agents (collectively, the
&quot;Holdings Indemnified Parties&quot;) from and against and in respect of any
and all Losses incurred by a Holdings Indemnified Party, which may be imposed
on, sustained, incurred or suffered by or assessed against a Holdings
Indemnified Party, directly or indirectly, to the extent relating to or arising
out of:</p>
<blockquote>
  <blockquote>
    <p>(i) the failure of any of the representations or warranties of Parent
    contained in Article III (excluding the representations and warranties
    contained in Section 3.8 and Section 3.11) to be true and correct on the
    date of this Agreement and on the Closing Date as though made on and as of
    the Closing Date (except to the extent that a representation or warranty
    expressly speaks as of a specified date or period of time and except as
    modified hereafter in this Section 8.1(b)(i)); <u>provided</u>, that solely
    for the purpose of this Section 8.1(b)(i), the representations and
    warranties in Sections 3.6(a) and 3.7 shall be read without regard to the
    words &quot;as of the date hereof&quot; and the representations and
    warranties in Sections 3.16(a) and (b) shall be read without regard to the
    words &quot;through and including the date hereof&quot;; <u>provided</u>, <u>further</u>,
    that solely for the purpose of Section 8.1(b)(i), the representations and
    warranties in Sections 3.3(b), 3.6(a) and (b), 3.7, 3.12 and 3.16 shall be
    read without regard to any materiality or Material Adverse Effect qualifiers
    contained therein;</p>
    <p>(ii) any failure by Parent to perform or comply with its covenants and
    agreements contained in this Agreement (excluding any covenant contained in
    Section 5.8 for which the exclusive remedy of Holdings shall be
    indemnification pursuant to Section 5.8), the Transition Agreement and the
    Assignment and Assumption Agreement; and</p>
    <p>(iii) except as set forth in Section 5.8, Section 8.1(g), Section 8.2 and
    Section 8.3, the businesses, operations and assets of Parent or any
    Non&#45;Bison Subsidiary (giving effect to the Restructuring and
    Closing), other than Losses relating to or arising out of the operation and
    conduct of the Business, commercial transactions with the Bison Subsidiaries
    in the ordinary course of business pre&#45;Closing and commercial
    transactions with the Bison Subsidiaries post&#45;Closing.</p>
  </blockquote>
</blockquote>
<p>(c) <u>Indemnification by Holdings and C&A Products</u>. Subject to the
other provisions of this Section 8.1, Holdings and C&A Products shall
jointly and severally indemnify Parent, its Subsidiaries and their present and
former directors, officers, employees and agents (collectively, the &quot;Parent
Indemnified Parties&quot;) from and against and in respect of any and all Losses
incurred by a Parent Indemnified Party, which may be imposed on, sustained,
incurred or suffered by or assessed against a Parent Indemnified Party, directly
or indirectly, to the extent relating to or arising out of:</p>
<blockquote>
  <blockquote>
    <p>(i) the failure of any of the representations or warranties of Holdings
    or C&A Products contained in Article IV to be true and correct on the
    date of this Agreement and on the Closing Date as though made on and as of
    the Closing Date (except to the extent that a representation or warranty
    expressly speaks as of a specified date or period of time); <u>provided</u>,
    <u>however</u>, that for purposes of this Section 8.1(c)(i), such
    representations and warranties that are qualified by reference to
    materiality or Holdings Material Adverse Effect shall be true and correct
    and such representations and warranties that are not so qualified shall be
    true and correct in all material respects;</p>
    <p>(ii) any failure by Holdings or C&A Products to perform or comply
    with their respective covenants and agreements contained in this Agreement
    (excluding any covenant contained in Section 5.8 for which the exclusive
    remedy of Parent shall be indemnification pursuant to Section 5.8), the
    Transition Agreement and the Assignment and Assumption Agreement;</p>
    <p>(iii) the use of any Parent Name from and after the Closing Date; and</p>
    <p>(iv) except as set forth in Section 5.8, Section 8.1(g), Section 8.2 and
    Section 8.3, the businesses, operations and assets of any Bison Subsidiary
    (giving effect to the Restructuring and Closing), other than Losses relating
    to or arising out of the operation and conduct of the businesses conducted
    by Parent and the Non&#45;Bison Subsidiaries (other than the Business),
    and commercial transactions with the Non&#45;Bison Subsidiaries in the
    ordinary course of business pre&#45;Closing and commercial transactions
    with the Bison Subsidiaries post&#45;Closing; <u>provided</u>, <u>however</u>,
    that with respect to Losses relating to or arising out of the businesses,
    operations and assets of THI and its Subsidiaries, Holdings and C&A
    Products shall indemnify the Parent Indemnified Parties only to the extent
    that such Losses are incurred by a Parent Indemnified Party on or after the
    earlier of (A) the first date that Holdings or C&A Products is required
    to account for THI and its Subsidiaries on a consolidated basis and (B) the
    date the Put Notice is delivered pursuant to Section 5.20(c).</p>
  </blockquote>
</blockquote>
<p>(d) <u>Limitation of Liability</u>. The obligations and liabilities of
Parent, Holdings and C&A Products under Sections 8.1(b)(i) and (c)(i),
respectively, shall be subject to the following additional limitations:</p>
<blockquote>
  <blockquote>
    <p>(i) Parent shall not have any liability with respect to the payment of
    any indemnification amounts which Holdings Indemnified Parties would be
    entitled pursuant to Section 8.1(b)(i), whether or not asserted pursuant to
    Section 8.1(b)(i), until such time as the aggregate amount of Losses
    incurred by Holdings Indemnified Parties for which Holdings Indemnified
    Parties would otherwise be entitled to indemnification pursuant to Section
    8.1(b)(i) exceeds ten million dollars ($10,000,000) and thereafter, only to
    the extent of such Losses in excess of ten million dollars ($10,000,000); <u>provided</u>,
    <u>however</u>, that (A) with respect to Losses relating to or arising out
    of the breach of any representation or warranty in Sections 3.3(b), 3.6,
    3.7, 3.12 and 3.16, a Holdings Indemnified Party shall not make any claim
    against Parent which individually does not exceed five hundred thousand
    dollars ($500,000), and such claims not meeting this threshold shall not be
    applied in calculating the ten million dollar ($10,000,000) minimum
    specified above, (B) with respect to any Losses for which Holdings
    Indemnified Parties would be entitled pursuant to Section 8.1(b)(i) other
    than those referred to in Section 8.1(d)(i)(A), a Holdings Indemnified Party
    shall not make any Claim against Parent which individually does not exceed
    fifty thousand dollars ($50,000) and such Claims not meeting this threshold
    shall not be applied in calculating the ten million dollar ($10,000,000)
    minimum specified above, and (C) Parent&#39;s maximum aggregate
    indemnification liability for which Holdings Indemnified Parties would be
    entitled pursuant to Section 8.1(b)(i) and Section 8.2(a) (excluding
    liability for any and all Environmental Losses related to, or arising out
    of, (A) the Dover Municipal Landfill located in Dover, New Hampshire and (B)
    the Cardinal Landfill located in Farmington, New Hampshire, which such
    Environmental Losses shall not be subject to any maximum aggregate
    indemnification liability cap) shall be one hundred million dollars
    ($100,000,000); and <u>provided</u>, <u>further</u>, that Parent&#39;s
    indemnification obligation for breach of any representation or warranty
    contained in Section 3.2(b) or (c) and pursuant to Sections 8.1(b)(ii) and
    (iii) shall not be subject to the provisions of this Section 8.1(d)(i).</p>
    <p>(ii) Notwithstanding anything to the contrary contained in this
    Agreement, in the event that a Holdings Indemnified Party is entitled to any
    indemnification amounts pursuant to Section 5.8 (i), Section 8.1(b)(i) or
    Section 8.2(a) in connection with Losses or Environmental Losses, as
    applicable, relating to or arising out of the business conducted by THI or
    its Subsidiaries, then, subject to the limitations set forth in Section
    8.1(d)(i) and Section 8.2(a), Parent shall pay (A) a minimum of 50% of such
    Losses or Environmental Loses, as applicable, at the time otherwise
    specified in Section 8.1 (and the remaining Losses shall not be taken into
    account for the purposes of calculating the deductibles, baskets and cap set
    forth in Section 8.1(d)(i) and Section 8.2(a)) and (B) the remaining 50% of
    such Losses or Environmental Losses, as applicable, when, and only to the
    extent that, Parent or its Subsidiaries receive cash in connection with the
    consummation of the sale of Parent&#39;s and its Subsidiaries&#39;
    THI Shares contemplated by Section 5.20; <u>provided</u>, <u>however</u>,
    that if Parent or its Subsidiaries have received solely cash in connection
    with the sale of their THI Shares pursuant to Section 5.20, than all such
    remaining Losses and Environmental Losses shall become due and payable at
    the time otherwise specified in Section 8.1.</p>
    <p>(iii) No party shall be liable for any Losses pursuant to Sections 8.1(b)
    or (c) unless the party seeking such indemnification (the &quot;Indemnified
    Party&quot;) has (x) delivered the notice of Claim in respect of such Loss
    required by Section 8.1(e) below and (y) such notice of Claim is received by
    the party from which indemnification is sought (the &quot;Indemnifying
    Party&quot;) within 30 days after the first anniversary of the Closing Date,
    except that (A) for any Losses relating to or arising out of breaches of any
    representations or warranties contained in Sections 3.2(b) and (c) and
    Section 4.4(a) and (b), such notice of Claim may be delivered at any time,
    (B) for breach of any covenant or agreement, such notice of Claim may be
    delivered at any time prior to the expiration of the applicable statute of
    limitation and (C) for Environmental Losses such notice of Claim may be
    delivered on or prior to the period specified in Section 8.2.
    Indemnification under Section 8.1(b)(i) and (ii) and Section 8.1(c)(i) and
    (ii) shall be the exclusive remedy of Holdings, C&A Products and Parent,
    as applicable, for breach of any representation, warranty, covenant or
    agreement (excluding breach of any covenant contained in Section 5.8 for
    which the exclusive remedy of Holdings, C&A Products and Parent, as
    applicable, shall be indemnification pursuant to Section 5.8) contained in
    this Agreement, the Transition Agreement and the Assignment and Assumption
    Agreement.</p>
  </blockquote>
</blockquote>
<p>(e) <u>Notice of Claim</u>. If the Indemnified Party shall become aware of
any claim, proceeding or other matter (a &quot;Claim&quot;) which may give rise
to a Loss or Environmental Loss that will be taken into account for purposes of
calculating whether the Indemnifying Party&#39;s indemnification obligation
arises pursuant to Section 8.1(b) or Section 8.1(c) above or Section 8.2(a) or
Section 8.3 below, the Indemnified Party shall promptly give notice thereof to
the Indemnifying Party. Such notice shall specify whether the Claim arises as a
result of a Claim by a Person against the Indemnified Party (a &quot;Third Party
Claim&quot;) or whether the Claim does not so arise (a &quot;Direct
Claim&quot;), and shall also specify with reasonable particularity (to the
extent that the information is available) the factual basis for the Claim and
the amount of the Claim, if known. If the Indemnified Party does not promptly
give notice of any Claim as specified above, such failure shall not be deemed a
waiver of the Indemnified Party&#39;s right to indemnification or
application to the applicable deductible set forth in Section 8.1(d), Section
8.2(a)(iii) or Section 8.2 (a)(iv) hereunder for Losses or Environmental Losses
in connection with such Claim, but the amount of reimbursement to which the
Indemnified Party is entitled or application to the applicable deductible shall
be reduced by the amount, if any, by which the Indemnified Party&#39;s
Losses or Environmental Losses would have been reduced had such notice been
promptly delivered.</p>
<p>(f) <u>Direct Claims</u>. With respect to any Direct Claim, following receipt
of notice from the Indemnified Party of the Claim, the Indemnifying Party shall
have 90 days to make such investigation of the Claim as is considered necessary
or desirable. For the purpose of such investigation, the Indemnified Party shall
make available to the Indemnifying Party the information relied upon by the
Indemnified Party to substantiate the Claim, together with all such other
information as the Indemnifying Party may reasonably request. If both parties
agree at or prior to the expiration of such 90&#45;day period (or any
mutually agreed upon extension thereof) to the validity and amount of such
Claim, they shall agree to apply it to the applicable deductible, or if the
applicable deductible has been satisfied, the Indemnifying Party shall
immediately pay to the Indemnified Party the full agreed upon amount of the
Claim, failing which the matter shall be referred to binding arbitration in such
manner as the parties may agree or shall be determined by a court of competent
jurisdiction in the State of Delaware.</p>
<p>(g) <u>Third Party Claims</u>.</p>
<blockquote>
  <blockquote>
    <p>(i) With respect to any Third Party Claims, the Indemnifying Party shall
    have the right, at its expense and at its election, to assume control of the
    negotiation, settlement and defense of the Claim through counsel of its
    choice reasonably acceptable to the other party; <u>provided</u>, that it
    irrevocably agrees that the Claim is covered by Section 8.1(b) or (c), as
    the case may be. In such event, the Indemnifying Party shall reimburse the
    Indemnified Party for all the Indemnified Party&#39;s reasonable
    out&#45;of&#45;pocket expenses as a result of such assumption. The
    election of the Indemnifying Party to assume such control shall be made
    within the latter of 90 days of receipt of notice of the Third Party Claim
    or thirty days after the indemnification obligation arises, failing which
    the Indemnifying Party shall be deemed to have elected not to assume such
    control. If the Indemnifying Party elects to assume such control, the
    Indemnified Party shall have the right to be informed and consulted with
    respect to the negotiation, settlement or defenses of such Third Party Claim
    and to retain counsel to act on its behalf, but the fees and disbursements
    of such counsel shall be paid by the Indemnified Party unless the
    Indemnifying Party consents to the retention of such counsel or unless the
    named parties to any action or proceeding include both the Indemnifying
    Party and the Indemnified Party and a representation of both the
    Indemnifying Party and the Indemnified Party by the same counsel would be
    inappropriate due to the actual or potential differing interests between
    them (such as the availability of different defenses). If the Indemnifying
    Party, having elected to assume such control, thereafter fails to defend the
    Third Party Claim within a reasonable period of time, the Indemnified Party
    shall be entitled to assume such control, and the Indemnifying Party shall
    be bound by the results obtained by the Indemnified Party with respect to
    the Third Party Claim. If any Third Party Claim is of a nature such that the
    Indemnified Party is required by applicable Law to make a payment to any
    Person (a &quot;Third Party&quot;) with respect to the Third Party Claim
    before the completion of settlement negotiations or related legal
    proceedings, the Indemnified Party may make such payment and the
    Indemnifying Party shall, subject to the provisions of Section 8.1, Section
    8.2 and Section 8.3, after demand by the Indemnified Party, reimburse the
    Indemnified Party for such payment. If the amount of any liability of the
    Indemnified Party under the Third Party Claim in respect of which such
    payment was made, as finally determined, is less than the amount which was
    paid by the Indemnifying Party to the Indemnified Party, the Indemnified
    Party shall, promptly after receipt of the difference from the Third Party,
    pay the amount of such difference to the Indemnifying Party.</p>
    <p>(ii) If the Indemnifying Party fails to assume control of the defense of,
    or having assumed such control fails to defend, any Third Party Claim, the
    Indemnified Party shall have the exclusive right to consent, settle or pay
    the amount claimed, in which case the Indemnifying Party shall be
    responsible for paying any such Claim or, if paid by the Indemnified Party,
    reimbursing the Indemnified Party. Whether or not the Indemnifying Party
    assumes control of the negotiation, settlement or defense of any Third Party
    Claim, the Indemnifying Party shall not settle any Third Party Claim without
    the written consent of the Indemnified Party, which consent shall not be
    unreasonably withheld, conditioned or delayed, unless such settlement
    provides solely for monetary damages or other monetary payments.</p>
    <p>(iii) The Indemnified Party and the Indemnifying Party shall cooperate
    fully with each other with respect to Third Party Claims and, regardless of
    which party has control thereof as provided for herein, shall keep each
    other reasonably advised with respect thereto.</p>
  </blockquote>
</blockquote>
<p>(h) Notwithstanding anything in Section 8.1, Section 8.2 or Section 8.3 to
the contrary, the Indemnifying Party shall not be liable for any Losses or
Environmental Losses arising out of any matter to the extent that the Losses or
Environmental Losses with respect to such matter have been mitigated as a result
of having been reflected as a liability or the subject matter of a specific
result in the Closing Financial Statement.</p>
<font COLOR="#ff0000">
<p>8.2 <a NAME="_Toc508437313"></a></font><u><a NAME="_Toc532024539">Environmental
Indemnification</a></p>
</u>
<p>.</p>
<p>(a) (i) Except for the environmental matters set forth in Section 8.2(a)(i)
of the Disclosure Schedule, Parent shall indemnify the Holdings Indemnified
Parties from and against and in respect of any and all Environmental Losses
incurred by a Holdings Indemnified Party, which may be imposed on, sustained,
incurred or suffered by or assessed against a Holdings Indemnified Party,
directly or indirectly, to the extent relating to or arising out of: (A) the
Remediation of Hazardous Substances that were disposed of or released on or into
the air, soils, groundwater, surface water, sediments or similar environmental
media, at, on, under or migrating from or to any Bison Property on or before the
Closing Date; (B) Litigation by Third Parties in respect of bodily injury or
property damage as a result of Hazardous Substances that were disposed of or
released into the soils, groundwater, surface water, sediments or similar
environmental media, on or before the Closing Date, at, on, under or migrating
from any Bison Property; (C) the disposal, storage, transportation, discharge,
release, treatment or recycling of Hazardous Substances, or the arrangement for
the same activities, by Parent or any of its Subsidiaries with respect to the
Business, prior to the Closing Date, at any Off&#45;Site Location, including
Environmental Losses related to bodily injury, property damage or the
Remediation of such Hazardous Substances; and (D) any violation by Parent or any
of its Subsidiaries of any Environmental Law applicable to the Business
(including Permits or other authorizations issued pursuant to any applicable
Environmental Law) on or prior to the Closing Date.</p>
<blockquote>
  <blockquote>
    <p>(ii) Parent&#39;s obligation to indemnify the Holdings Indemnified
    Parties for the matters addressed in Section 8.2(a)(i)(A) through (C) shall
    be limited to those matters as to which Holdings provides Parent with
    written notice of said Claim in the manner set forth in Section 8.1(e)
    within 10 years after the Closing Date. Parent&#39;s obligation to
    indemnify the Holdings Indemnified Parties for matters addressed in Section
    8.2(a)(i)(D) shall be limited to those matters as to which Holdings provides
    Parent with written notice of said Claim in the manner set forth in Section
    8.1(e) within two years after the Closing Date.</p>
    <p>(iii) Notwithstanding the foregoing, Parent shall not have any liability
    with respect to the payment of any indemnification amounts pursuant to
    Section 8.2(a)(i)(A) through (D) until such time as the aggregate amount of
    such Environmental Losses incurred by the Holdings Indemnified Parties,
    excluding any and all Environmental Losses related to, or arising out of,
    (A) the Dover Municipal Landfill located in Dover, New Hampshire and (B) the
    Cardinal Landfill located in Farmington, New Hampshire, for which such
    parties would otherwise be entitled to indemnification pursuant to Section
    8.2(a)(i)(A) through (D) exceeds five million dollars ($5,000,000) and
    thereafter, Parent shall only be liable to the extent of such Environmental
    Losses in excess of five million dollars ($5,000,000); <u>provided</u>, <u>however</u>,
    that (A) Holdings shall not make any claim against Parent which individually
    does not exceed fifty thousand dollars ($50,000), and such claims not
    meeting this threshold shall not be applied in calculating the five million
    dollar ($5,000,000) limitation specified above, and (B) Parent&#39;s
    maximum aggregate indemnification liability pursuant to Section 8.2(a)(i)
    shall be subject to and included within the dollar limitation contained in
    Section 8.1(d)(i)(B).</p>
    <p>(iv) Notwithstanding any other provision of this Agreement, Parent shall
    not have any liability with respect to the payment of any indemnification
    amounts pursuant to Section 8.2(a)(i)(A) through (D) with respect to
    Environmental Losses related to, or arising out of, (A) the Dover Municipal
    Landfill located in Dover, New Hampshire and (B) the Cardinal Landfill
    located in Farmington, New Hampshire until such time as the aggregate amount
    of such Environmental Losses incurred by the Holdings Indemnified Parties
    for which such parties would otherwise be entitled to indemnification
    pursuant to Section 8.2(a)(i)(A) through (D) exceeds twenty million dollars
    ($20,000,000) and thereafter, Parent shall be liable for fifty percent (50%)
    of such Environmental Losses in excess of twenty million dollars
    ($20,000,000).</p>
    <p>(v) Holdings and C&A Products shall jointly and severally indemnify
    and hold the Parent Indemnified Parties harmless against any Environmental
    Losses relating to the environmental matters set forth in Section 8.2(a)(i)
    of the Disclosure Schedule (other than any Environmental Losses relating to
    THI or any of its Subsidiaries incurred by the Parent Indemnified Parties
    prior to the earlier of (A) the first date that Holdings or C&A Products
    is required to account for THI and its Subsidiaries on a consolidated basis
    and (B) the date the Put Notice is delivered pursuant to Section 5.20(c)).
    Holdings and C&A Products shall jointly and severally indemnify and hold
    the Parent Indemnified Parties harmless against any Environmental Losses not
    related to the environmental matters set forth in Section 8.2(a)(i) of the
    Disclosure Schedule arising out of the matters described in Section
    8.2(a)(i)(A)&#45;(D) up to a maximum amount of (x) twenty million
    dollars ($20,000,000) for Environmental Losses related to the Dover
    Municipal Landfill located in Dover, New Hampshire and the Cardinal Landfill
    located in Farmington, New Hampshire; provided, however, if the Parent
    Indemnified Parties Environmental Losses exceed twenty million dollars, then
    Holdings and C&A Products shall jointly and severally indemnify the
    Parent Indemnified Parties for 50% of all Environmental Losses in excess of
    twenty million dollars, and (y) five million dollars ($5,000,000) for all
    other such Environmental Losses (other than any Environmental Losses
    relating to THI or any of its Subsidiaries incurred by the Parent
    Indemnified Parties prior to the earlier of (A) the first date that Holdings
    or C&A Products is required to account for THI and its Subsidiaries on a
    consolidated basis and (B) the date the Put Notice is delivered pursuant to
    Section 5.20(c)). For avoidance of doubt, any amounts paid by Holdings
    pursuant to this Section 8.2(j) shall be deemed to be Environmental Losses
    incurred by the Holdings Indemnified Parties for purposes of the limits set
    forth in sections 8.2(a)(iii) and 8.2(a)(iv).</p>
    <p>(vi) Notwithstanding any other provision of this Agreement, if a Holdings
    Indemnified Party has a claim pursuant to Section 8.2(a)(i)(D) of this
    Agreement, Parent shall indemnify the Holdings Indemnified Parties with
    respect to (A) any claims for fines or penalties arising out of said
    noncompliance and (B) Environmental Losses arising out of any expenditures
    made or actions taken by or on behalf of Holdings or C&A Products after
    the Closing Date to correct such noncompliance, but only to the extent that
    the Environmental Losses relate to the least expensive, commercially
    reasonable alternative necessary to correct such noncompliance; <u>provided</u>,
    that Holdings shall not make any claim against Parent pursuant to this
    Section 8.2(a)(vi)(B) which individually does not exceed fifty thousand
    dollars ($50,000) with respect to any single occurrence of noncompliance; <u>provided</u>,
    <u>further</u>, that with respect to any single occurrence of noncompliance,
    Parent shall only be liable for such Environmental Losses in excess of fifty
    thousand dollars ($50,000). If Holdings or C&A Products elects to
    correct such noncompliance by any means other than the least expensive,
    commercially reasonable alternative, subject to the provisions of this
    Section 8.2, Parent shall indemnify the Holdings Indemnified Parties for
    Environmental Losses up to an amount equal to the difference between the
    Environmental Losses that otherwise would have been incurred if the least
    expensive, commercially reasonable alternative had been implemented and five
    hundred thousand dollars ($500,000). Further, with respect to claims
    pursuant to Section 8.2(a)(i)(D) which involve a violation that commenced
    prior to the Closing Date and continues after the Closing Date,
    Parent&#39;s indemnification obligation with respect to such continuing
    violation shall apply only with respect to the time period prior to the
    Closing Date. Notwithstanding the above, the foregoing shall not be
    interpreted to preclude the Holdings Indemnified Parties from
    indemnification with respect to the Remediation of Hazardous Substances that
    are present on or before the Closing Date in any environmental media at, on,
    under or migrating from or to, any Bison Property, as otherwise provided in
    this Agreement, including with respect to Hazardous Substances that were
    discharged into the environment prior to the Closing Date and continue to
    exist in the environment after the Closing Date.</p>
    <p>&nbsp;</p>
  </blockquote>
</blockquote>
<p>(b) With respect to claims to indemnify Holdings Indemnified Parties that are
described by Section 8.2(a)(i)(A):</p>
<blockquote>
  <blockquote>
    <p>(i) Parent shall only be required to indemnify Holdings Indemnified
    Parties to the extent that, after the deductible set forth in Section
    8.2(a)(iii) is met: (A) the Remediation of the Hazardous Substances is
    required pursuant to an applicable Environmental Law that is in effect as of
    the Closing Date; (B) the Remediation Standards applicable to the
    Remediation are the most cost effective Remediation Standards required under
    Environmental Law assuming continued industrial use of the property, <u>provided</u>,
    that it is a Bison Property and where it is not, such other use then
    associated with such non&#45;Bison Property; and (C) the Remediation
    shall be conducted in a reasonable, cost effective manner consistent with
    applicable Environmental Law or as may be otherwise required by a
    Governmental Authority. Holdings shall accept appropriate engineering
    controls or institutional controls, including, if necessary, deed
    restrictions limiting property to an industrial use or limitations on the
    drilling and use of water wells on Bison Properties (individually or
    collectively, a &quot;Restriction&quot;), if such controls are needed in
    order to complete a Remediation consistent with the use of the least
    stringent Remediation Standards. Holdings shall not be required to consent
    to any Restriction in connection with completing a Remediation if the
    Restriction would materially impair or otherwise unreasonably interfere with
    the continued operations of the Bison Subsidiary or if the Governmental
    Authority having jurisdiction for such matter does not approve of reliance
    on such Restriction.</p>
    <p>(ii) For the sole purpose of seeking indemnification for Environmental
    Losses pursuant to Section 8.2(a)(i) of this Agreement, after the Closing
    Date, neither Holdings nor its Affiliates shall undertake any effort to
    discover whether there has been a release of Hazardous Substances at, on,
    underneath or migrating from any Bison Property, including the collection of
    soil, groundwater, or surface water samples or samples of other
    environmental media, except that Holdings or its authorized representatives
    may take such samples <u>and</u> the Holdings Indemnified Parties may seek
    indemnification therefore if: (A) required pursuant to an applicable
    Environmental Law or a lawful order of a Governmental Authority; (B)
    required by a potential acquirer of said Bison Property or the Business or a
    lessee of said Bison Property; (C) required in connection with defending
    against or pursuing a Third Party Claim; or (D) required by
    Holdings&#39; or C&A Products&#39; lender or financial
    underwriter prior to five years from the Closing Date. If Holdings fails to
    comply in any material respect with this provision, Parent shall have no
    obligation to provide any Holdings Indemnified Party with an indemnity for
    the Remediation of Hazardous Substances on such Bison Property or for any
    Claims for bodily injury or property damage related to Hazardous Substances
    on such property; <u>provided</u>, <u>however</u>, that this limitation on
    indemnification shall apply only the extent that any Environmental Losses
    incurred by a Holdings Indemnified Party for which indemnification is sought
    are identified solely as a result of such material noncompliance.</p>
  </blockquote>
</blockquote>
<p>(c) Claims brought pursuant to this Section 8.2 shall be subject to the
procedures for indemnification set forth in Section 8.1(g) if such Claims are
Third Party Claims. Claims that involve or also involve the Remediation of
Hazardous Substances at any Bison Property shall also be subject to the
procedures set forth in Section 8.2(f).</p>
<p>(d) If Holdings or any of its Affiliates intends to sell, lease or otherwise
convey any Bison Subsidiary or any Bison Property, Holdings or said Affiliate
shall include, as a condition of such sale, lease or other agreement, terms and
conditions that will ensure that all Restrictions that have been accepted with
respect to the Bison Property are not disturbed (or, if such Restrictions will
be disturbed, that they will be restored at the expense of the party causing the
disturbance or, if additional Remediation is required as a result of the
disturbance of such Restrictions, that such additional Remediation will be
performed at the sole cost and expense of the party causing the disturbance).</p>
<p>(e) For purposes of this Agreement: (1) the term &quot;Environmental
Losses&quot; shall only include the following costs and expenses (after giving
effect to any related reduction in Taxes and amounts recovered from third
parties, including amounts recovered under insurance policies, with respect to
such Environmental Losses): (A) costs and expenses to implement a Remediation;
(B) damages for third party bodily injury and third party property damage; (C)
fines and penalties; and (D) reasonable attorneys&#39; fees,
consultants&#39; fees and expenses associated with (A), (B) or (C),
including costs and expenses associated with Litigation; (2) the term
&quot;Remediation Standard&quot; means a numerical standard (whether resulting
from an enacted statute, promulgated regulation, guidance or policy document
issued by a Governmental Authority, or developed on a
case&#45;by&#45;case basis through a risk assessment or other
methodology authorized pursuant to an applicable Environmental Law and, if
appropriate, approved by a Governmental Authority) that defines the
concentrations of Hazardous Substances that may be permitted to remain in any
environmental media after an investigation, remediation or containment of a
release of Hazardous Substances; (3) the term &quot;Remediation&quot; means any
action of any kind to investigate and/or clean up and/or otherwise respond a
release of Hazardous Substances into an environmental medium, including the
following activities: (A) monitoring, investigation, assessment, treatment,
cleanup, containment, removal, mitigation, remediation, corrective action,
response or restoration work; (B) obtaining any permits, consents, approvals or
authorizations of any Governmental Authority necessary to conduct any such
activity; (C) preparing and implementing any plans or studies for any such
activity; and (D) obtaining a written notice from a Governmental Authority with
jurisdiction over the site being addressed under Environmental Laws that no
additional work is required by such Governmental Authority; and (4) the term
&quot;Off&#45;Site Location&quot; means any location other than (x) any
Bison Property or (y) property adjacent to any Bison Property which has been
impacted by a release of Hazardous Substances at, on, under or from any Bison
Property.</p>
<p>(f) <u>Procedures for Remedial Actions</u>.</p>
<blockquote>
  <blockquote>
    <p>(i) Parent shall be entitled to assume control of Remediations at or with
    respect to any Bison Property (other than the Dover Municipal Landfill and
    the Cardinal Landfill) if the deductible set forth in Section 8.2(a)(iii) is
    met. The election of Parent to assume control of any such Remediation shall
    be made within a reasonable time. In the event that Parent shall control any
    Remediation, it shall promptly provide copies to Holdings of all notices,
    correspondence, draft reports, submissions, draft and final work plans and
    final reports and shall give Holdings a reasonable opportunity (at
    Holding&#39;s own expense) to comment on any submissions Parent intends
    to deliver or submit to the appropriate regulatory body prior to said
    submission. The party not controlling any Remediation may, at its own
    expense, hire its own consultants, attorneys or other professionals to
    monitor the work performed by the party controlling such Remediation,
    including any field work undertaken by such party. Notwithstanding the
    foregoing, Parent and Holdings, as applicable, agree to cooperate with each
    other, directly and through their respective consultants and counsel, to
    effect the successful completion of the Remediation within such period as
    may be specified by a Governmental Authority or under applicable
    Environmental Laws, or otherwise within a reasonable period of time; <u>provided</u>,
    <u>however</u>, that neither party shall take any actions that could
    unreasonably delay or unreasonably interfere with the performance of the
    work of the party controlling any Remediation.</p>
    <p>(ii) If Holdings or C&A Products is required to or desires to
    undertake a Remediation at or with respect to the Dover Municipal Landfill
    or the Cardinal Landfill that either Holdings or Parent determines is
    reasonably likely to cause the deductible set forth in Section 8.2(a)(iv) to
    be met, then Holdings shall notify Parent prior to undertaking such
    Remediation, and Parent and Holdings shall consult with each other, in good
    faith, to implement a mutually agreeable course of action to effect such
    Remediation. In the event of such determination, Holdings or C&A
    Products shall promptly provide copies to Parent of all notices,
    correspondence, draft reports, submissions, draft and final work plans and
    final reports and shall give Parent a reasonable opportunity (at
    Parent&#39;s expense) to comment on any submissions Holdings intends to
    deliver or submit to the appropriate regulatory body prior to said
    submission. Parent may, at its own expense, hire its own consultants,
    attorneys or other professionals to monitor the work performed by Holdings
    or C&A Products, including any field work undertaken by Holdings. Parent
    and Holdings, as applicable, agree to cooperate with each other, directly
    and through their respective consultants and counsel, to effect the
    successful completion of the Remediation within such period as may be
    specified by a Governmental Authority or under applicable Environmental
    Laws, or otherwise within a reasonable period of time; <u>provided</u>, <u>however</u>,
    that neither party shall take any actions that could unreasonably delay or
    unreasonably interfere with the performance of the Remediation.</p>
  </blockquote>
</blockquote>
<p>(g) <u>Exclusive Remedy for Environmental Matters; Indemnification by
Holdings</u>. Notwithstanding anything to the contrary in this Agreement,
Holdings and C&A Products hereby agree that their sole and exclusive remedy
against any Parent Indemnified Party with respect to any and all Losses arising
under or related to any Environmental Law or any Hazardous Substances or the
environment, including statutory or common law claims for Environmental Losses,
damages, fines, penalties or response costs related to Hazardous Substances or
the environment, in connection with the Bison Subsidiaries, shall be the
indemnity set forth in this Section 8.2. Except with respect to the remedy
referred to in the preceding sentence, Holdings and C&A Products hereby
waive, to the fullest extent permitted under applicable Law, and forever
releases the Parent Indemnified Parties, in connection with the Bison
Subsidiaries from, and shall indemnify the Parent Indemnified Parties against,
any and all Environmental Losses arising under or related to Environmental Laws
or Hazardous Substances. Parent Indemnified Parties shall not make any claim
against Holdings for indemnification for any Loss, including any Environmental
Loss, pursuant to this Section 8.2(g) which individually does not exceed fifty
thousand dollars ($50,000). Holdings&#39; obligation to indemnify the Parent
Indemnified Parties pursuant to this Section 8.2(g) shall be limited to those
matters as to which Parent provides Holdings with written notice of said Claim
in the manner set forth in Section 8.1(e).</p>
<p>(h) <u>Disputes</u>. In the event of any dispute between Parent and Holdings
or C&A Products concerning a Claim for indemnification for Environmental
Losses under this Section 8.2 which cannot be resolved within thirty (30) days,
such dispute shall be promptly referred to an independent third party having
expertise in the matters at issue and mutually acceptable to the parties (or if
the parties cannot agree, the CPR Institute for Dispute Resolution, in New York,
New York shall select a recognized expert who shall be independent from each of
the parties), whose fees and expenses shall be shared equally by the parties,
and who shall evaluate the facts and circumstances at issue and recommend a
course of action that the expert believes in its good faith judgment satisfies
the requirements of this Agreement and applicable Environmental Laws. Such
recommendations shall be final and binding on the parties. The parties agree to
act as promptly as practicable in implementing the foregoing procedures; <u>provided</u>,
<u>however</u>, that in the event that actions are required to be taken by a
Governmental Authority or in an emergency to avoid imminent and substantial harm
to health or the environment before the foregoing procedures can be implemented,
Holdings or C&A Products may undertake such actions without prejudice to its
rights under this Section 8.2 to seek indemnification for Environmental Losses.
In all other situations, Holdings&#39; or C&A Products&#39; failure
to comply with the requirements of this Section 8.2(h) shall not limit or reduce
the obligations of Parent under this Agreement except to the extent Parent is
actually and materially prejudiced thereby.</p>
<p>(i) <u>Other</u>. Nothing contained in this Section 8.2 shall restrict
Holdings or C&A Products from taking any action (and, if appropriate
pursuant to Section 8.2(a)(i), seeking indemnification therefore) where required
to be taken by any Governmental Authority or in an emergency to avoid imminent
and substantial harm to health or the environment.</p>
<font COLOR="#ff0000">
<p>8.3 <a NAME="_Toc508437314"></a></font><u><a NAME="_Toc532024540">Quota
Purchase Agreement Indemnification</a></p>
</u>
<p>. Holdings and C&A Products shall indemnify Parent from and against and
in respect of any and all Losses incurred by Parent under any guarantee
agreement by and between Parent and S.W. Industries Inc., or any successor
thereto, relating to any assignment by Parent to C&A Products of
Parent&#39;s rights, and the assumption by C&A Products of
Parent&#39;s obligations, under the Quota Purchase Agreement dated as of May
31, 2000 by and between Textron International Holdings, S.L. and S.W. Industries
Inc., or if no such assignment has occurred prior to the Closing, the parties
hereto shall take the actions relating to the Brazilian Entities specified in
the Transition Agreement.</p>
<font COLOR="#ff0000">
<p>8.4 <a NAME="_Toc503343010"></a><a NAME="_Toc503343111"></a><a NAME="_Toc503343356"></a><a NAME="_Toc508437315"></a></font><u><a NAME="_Toc532024541">Name
Changes</a></p>
</u>
<p>. C&A Products and its Subsidiaries shall have the right to use, subject
to Parent&#39;s reasonable quality control requirements (as the same may
exist from time to time), the name &quot;Textron&quot; in the Business for a
period of eighteen months following the Closing Date, and in exchange therefor,
C&A Products shall pay to Parent, in cash, (i) thirteen million forty
thousand dollars ($13,040,000) on December 15, 2002 and (ii) six million five
hundred twenty thousand dollars ($6,520,000) on December 15, 2003. In the event
that C&A Products is unable to make such cash payments to Parent on the
dates specified above without causing a Material Breach, such amounts shall
accrue interest from and including December 15, 2002 and December 15, 2003,
respectively, compounding monthly, at the Interest Rate. C&A Products shall
pay such amounts, whether in whole or in part, as soon as possible without
causing a Material Breach. On or before the eighteen month anniversary of the
Closing Date, Holdings or C&A Products will change the names of the entities
listed in Section 8.4 of the Disclosure Schedule and cease using the name
&quot;Textron&quot; in any manner. Holdings and C&A Products agree that from
and after the Closing Date, (i) the name &quot;Textron&quot; and all similar
related names (all such names being the &quot;Parent Names&quot;) shall be owned
by Parent or a Non&#45;Bison Subsidiary, (ii) neither Holdings, C&A
Products nor any Bison Subsidiary shall have any rights in, and shall not, after
the eighteen month anniversary of the Closing Date, use, any Parent Name and
(iii) neither Holdings, C&A Products nor any Bison Subsidiary shall contest
the ownership or validity of any rights of Parent or any Non&#45;Bison
Subsidiary in or to the Parent Names.</p>
<font COLOR="#ff0000">
<p ALIGN="CENTER">ARTICLE IX<a NAME="_Toc503343113"></a><a NAME="_Toc503343358"></a></font><br>
<br>
<a NAME="_Toc503343012"></a><a NAME="_Toc503343962"></a><a NAME="_Toc503667944"></a><a NAME="_Toc503684875"></a><a NAME="_Toc504459567"></a><a NAME="_Toc505070830"></a><a NAME="_Toc505137426"></a><a NAME="_Toc505767673"></a><a NAME="_Toc506346244"></a><a NAME="_Toc506628561"></a><a NAME="_Toc506775372"></a><a NAME="_Toc507592240"></a><a NAME="_Toc508437317"></a><a NAME="_Toc508709263"></a><a NAME="_Toc514732049"></a><a NAME="_Toc514732787"></a><a NAME="_Toc516456630"></a><a NAME="_Toc516460990"></a><a NAME="_Toc516463406"></a><a NAME="_Toc516560591"></a><a NAME="_Toc518363284"></a><a NAME="_Toc518466865"></a><a NAME="_Toc518733514"></a><a NAME="_Toc519520882"></a><a NAME="_Toc519701057"></a><a NAME="_Toc520104904"></a><a NAME="_Toc520108758"></a><a NAME="_Toc520261566"></a><a NAME="_Toc520609495"></a><a NAME="_Toc521132992"></a><a NAME="_Toc521305015"></a><a NAME="_Toc521330792"></a><a NAME="_Toc521426505"></a><a NAME="_Toc521468904"></a><a NAME="_Toc521492955"></a><a NAME="_Toc529701297"></a><a NAME="_Toc52
9706236"></a><a NAME="_Toc529947425"></a><a NAME="_Toc530205145"></a><a NAME="_Toc530215751"></a><a NAME="_Toc530801309"></a><a NAME="_Toc531699903"></a><a NAME="_Toc531774291"></a><a NAME="_Toc531805705"></a><a NAME="_Toc532024542">MISCELLANEOUS
AND GENERAL</a></p>
<p ALIGN="CENTER">&nbsp;</p>
<p>&nbsp;</p>
<font COLOR="#ff0000">
<p>9.1 <a NAME="_Toc503343013"></a><a NAME="_Toc503343114"></a><a NAME="_Toc503343359"></a></font><a NAME="_Toc532024543"><u>Interpretation</u>.</a></p>
<font FACE="Courier New">
<p>&nbsp;</p>
</font>
<p>(a) Whenever the words &quot;include&quot;, &quot;includes&quot; or
&quot;including&quot; are used in this Agreement they shall be deemed to be
followed by the words &quot;without limitation.&quot;</p>
<p>(b) The words &quot;hereof&quot;, &quot;hereby&quot;, &quot;herein&quot; and
&quot;herewith&quot; and words of similar import shall, unless otherwise stated,
be construed to refer to this Agreement as a whole and not to any particular
provision of this Agreement, and article, section, paragraph, exhibit and
schedule references are to the articles, sections, paragraphs, exhibits and
schedules of this Agreement unless otherwise specified.</p>
<p>(c) The plural of any defined term shall have a meaning correlative to such
defined term, the singular of any defined term shall have a meaning correlative
to such term defined in the plural and words denoting any gender shall include
all genders. Where a word or phrase is defined herein, each of its other
grammatical forms shall have a corresponding meaning.</p>
<p>(d) A reference to any party to this Agreement or any other agreement or
document shall include such party&#39;s permitted successors and permitted
assigns.</p>
<p>(e) A reference to any legislation or to any provision of any legislation
shall include any amendment, modification or re&#45;enactment thereof, any
legislative provision substituted therefore and all regulations and statutory
instruments issued thereunder or pursuant thereto.</p>
<p>(f) The parties have participated jointly in the negotiation and drafting of
this Agreement. In the event an ambiguity or question of intent or
interpretation arises, this Agreement shall be construed as if drafted jointly
by the parties, and no presumption or burden of proof shall arise favoring or
disfavoring any party by virtue of the authorship of any provisions of this
Agreement.</p>
<font COLOR="#ff0000">
<p>9.2 </font><u><a NAME="_Toc532024544">Principle of Construction</a></p>
</u>
<p>. In construing this Agreement, for the avoidance of doubt, those Contracts
and assets not owned as of any date of determination by a Bison Subsidiary (and
the related liabilities) but which are intended to be made the subject of the
transfer and assignment contemplated by the Assignment and Assumption Agreement
shall be construed as pertaining to the business, operations, assets,
properties, liabilities and Contracts of the Bison Subsidiaries and the
Business. In furtherance thereof, any action not permitted to be taken by a
Bison Subsidiary with respect to the Business shall apply to Parent and its
Subsidiaries.</p>
<font COLOR="#ff0000">
<p>9.3 <a NAME="_Toc503343014"></a><a NAME="_Toc503343115"></a><a NAME="_Toc503343360"></a><a NAME="_Toc508437319"></a></font><u><a NAME="_Toc532024545">Payment
of Expenses and Other Payments</a></p>
</u>
<p>. Whether or not the Transactions shall be consummated and except as
otherwise provided in this Agreement, each party hereto shall pay its own
expenses incident to preparing, entering into and carrying out this Agreement
and the consummation of the transactions contemplated hereby.</p>
<font COLOR="#ff0000">
<p>9.4 <a NAME="_Toc503343015"></a><a NAME="_Toc503343116"></a><a NAME="_Toc503343361"></a><a NAME="_Toc508437320"></a></font><u><a NAME="_Toc532024546">Amendment</a></p>
</u>
<p>. This Agreement may be amended only by a written agreement signed by each of
the parties hereto.</p>
<font COLOR="#ff0000">
<p>9.5 <a NAME="_Toc503343016"></a><a NAME="_Toc503343117"></a><a NAME="_Toc503343362"></a></font><u><a NAME="_Toc532024547">Waiver
and Extension</a></p>
</u>
<p>. At any time prior to the Closing Date, the parties may (a) extend the time
for the performance of any of the obligations or other acts of the other parties
hereto, (b) waive any inaccuracies in the representations and warranties
contained herein or in any document delivered pursuant hereto or (c) except to
the extent prohibited by Law, waive compliance with any of the agreements
described or conditions contained herein. Any agreement on the part of a party
hereto to any such extension or waiver shall be valid only if set forth in an
instrument in writing signed by such party. The failure of any party at any time
or times to demand performance of any provision hereof shall in no manner affect
the right of such party at a later time to enforce the same or any other
provision of this Agreement. No waiver of any condition or the breach of any
term contained in this Agreement in one or more instances shall be deemed to be
a, or construed as a further or continuing, waiver of such condition or breach.</p>
<font COLOR="#ff0000">
<p>9.6 <a NAME="_Toc503343017"></a><a NAME="_Toc503343118"></a><a NAME="_Toc503343363"></a><a NAME="_Toc508437322"></a></font><u><a NAME="_Toc532024548">Counterparts</a></p>
</u>
<p>. For the convenience of the parties hereto, this Agreement may be executed
in any number of counterparts, each such counterpart being deemed to be an
original instrument, and all such counterparts shall together constitute one
agreement.</p>
<font COLOR="#ff0000">
<p>9.7 <a NAME="_Toc503343018"></a><a NAME="_Toc503343119"></a><a NAME="_Toc503343364"></a><a NAME="_Toc508437323"></a></font><u><a NAME="_Toc532024549">Governing
Law</a></p>
</u>
<p>. This Agreement shall be governed by, and construed in accordance with, the
Laws of the State of Delaware.</p>
<p><a NAME="_Toc503343019"></a><a NAME="_Toc503343120"></a><a NAME="_Toc503343365"></p>
<u>
<p></u></a><u><a NAME="_Toc508437324"></a><a NAME="_Toc532024550"></p>
</a></u><a NAME="_Toc532024550"><font COLOR="#ff0000">
<p>9.8 </font><u>Notices</u></a></p>
<p>. Any notice, request, instruction or other document to be given hereunder by
any party to another party shall be in writing and shall be deemed given when
delivered personally, upon receipt of a transmission confirmation (with a
confirming copy sent by overnight courier) if sent by facsimile or like
transmission and on the next business day when sent by Federal Express, United
Parcel Service, Express Mail, or other reputable overnight courier, as follows:</p>
<table CELLSPACING="0" CELLPADDING="1" WIDTH="600">
  <tr>
    <td WIDTH="28%" VALIGN="TOP">
      <p ALIGN="RIGHT">(a)</td>
    <td WIDTH="55%" VALIGN="TOP">
      <p>If to Parent, to:<br>
      Textron Inc.<br>
      40 Westminster Street<br>
      Providence, RI 02903<br>
      Attention: John R. Curran<br>
      Vice President &#45; Mergers and Acquisitions<br>
      (401) 457&#45;3603 (telephone)<br>
      (401) 457&#45;2385 (facsimile)</p>
    </td>
    <td WIDTH="17%" VALIGN="TOP">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="28%" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="55%" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="17%" VALIGN="TOP">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="28%" VALIGN="TOP">
      <p>with a copy to:</td>
    <td WIDTH="55%" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="17%" VALIGN="TOP">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="28%" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="55%" VALIGN="TOP">
      <p>Textron Inc.<br>
      40 Westminster Street<br>
      Providence, RI 02903<br>
      Attention: Terrance O&#39;Donnell<br>
      Executive Vice President and General Counsel<br>
      (401) 457&#45;2555 (telephone)<br>
      (401) 457&#45;2418 (facsimile)</p>
    </td>
    <td WIDTH="17%" VALIGN="TOP">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="28%" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="55%" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="17%" VALIGN="TOP">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="28%" VALIGN="TOP"><font FACE="Courier New">
      <p ALIGN="RIGHT">(b)</font></td>
    <td WIDTH="55%" VALIGN="TOP">
      <p>If to Holdings or C&A Products to:</td>
    <td WIDTH="17%" VALIGN="TOP">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="28%" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="55%" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="17%" VALIGN="TOP">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="28%" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="55%" VALIGN="TOP">
      <p>Collins & Aikman Corporation<br>
      5755 New King Court<br>
      Troy, Michigan 48098<br>
      Attention: Thomas E. Evans, CEO<br>
      (248) 824&#45;1510 (telephone)<br>
      (248) 824&#45;1512 (facsimile)</p>
    </td>
    <td WIDTH="17%" VALIGN="TOP">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="28%" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="55%" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="17%" VALIGN="TOP">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="28%" VALIGN="TOP"><font FACE="Courier New">
      <p ALIGN="RIGHT">and</font></td>
    <td WIDTH="55%" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="17%" VALIGN="TOP">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="28%" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="55%" VALIGN="TOP">
      <p>Attention: Ronald T. Lindsay, General Counsel<br>
      (248) 824&#45;1633 (telephone)<br>
      (248) 824&#45;1882 (facsimile)</p>
    </td>
    <td WIDTH="17%" VALIGN="TOP">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="28%" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="55%" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="17%" VALIGN="TOP">&nbsp;</td>
  </tr>
</table>
<p>&nbsp;</p>
<table CELLSPACING="0" CELLPADDING="1" WIDTH="600">
  <tr>
    <td WIDTH="28%" VALIGN="TOP">
      <p>with a copy to:</td>
    <td WIDTH="55%" VALIGN="TOP">
      <p>Cahill, Gordon & Reindel<br>
      80 Pine Street<br>
      New York, NY 10005<br>
      Attention: W. Leslie Duffy, Esq.<br>
      Jonathan Schaffzin, Esq.<br>
      (212) 701&#45;3000 (telephone)<br>
      (212) 269&#45;5420 (facsimile)</p>
    </td>
    <td WIDTH="17%" VALIGN="TOP">&nbsp;</td>
  </tr>
</table>
<p>or to such other persons or addresses as may be designated in writing by the
party to receive such notice. Nothing in this Section 9.7 shall be deemed to
constitute consent to the manner and address for service of process in
connection with any legal proceeding (including Litigation arising out of or in
connection with this Agreement), which service shall be effected as required by
applicable Law.</p>
<font COLOR="#ff0000">
<p>9.9 <a NAME="_Toc503343020"></a><a NAME="_Toc503343121"></a><a NAME="_Toc503343366"></a><a NAME="_Toc508437325"></a></font><a NAME="_Toc532024551"><u>Entire
Agreement; Assignment</u>.</a></p>
<p>The Transaction Agreements, Italian JV Documents, Leasing Documents and the
guarantee required by Exhibit 12 (including all exhibits and schedules to such
agreements) together (a) constitute the entire agreement among the parties with
respect to the subject matter hereof and supersede all other prior agreements
and understandings, both written and oral, among the parties or any of them with
respect to the subject matter hereof and (b) shall not be assigned or
transferred by operation of law or otherwise without the prior written consent
of each other party hereto.</p>
<font COLOR="#ff0000">
<p>9.10 <a NAME="_Toc503343021"></a><a NAME="_Toc503343122"></a><a NAME="_Toc503343367"></a><a NAME="_Toc508437326"></a></font><u><a NAME="_Toc532024552">Parties
in Interest</a></p>
</u>
<p>. This Agreement is not intended to confer any rights or remedies upon any
Person except the parties hereto and their respective successors and assigns and
any other Person which is indemnified under this Agreement pursuant to Sections
8.1 and 8.2.</p>
<font COLOR="#ff0000">
<p>9.11 <a NAME="_Toc503343022"></a><a NAME="_Toc503343123"></a><a NAME="_Toc503343368"></a><a NAME="_Toc508437327"></a></font><u><a NAME="_Toc532024553">Validity</a></p>
</u>
<p>. The invalidity or unenforceability of any provision of this Agreement shall
not affect the validity or enforceability of any other provisions of this
Agreement, each of which shall remain in full force and effect.</p>
<font COLOR="#ff0000">
<p>9.12 <a NAME="_Toc503343023"></a><a NAME="_Toc503343124"></a><a NAME="_Toc503343369"></a><a NAME="_Toc508437328"></a></font><u><a NAME="_Toc532024554">Captions</a></p>
</u>
<p>. The Article, Section and paragraph captions herein are for convenience of
reference only, do not constitute part of this Agreement and shall not be deemed
to limit or otherwise affect any of the provisions hereof.</p>
<font COLOR="#ff0000">
<p>9.13 <a NAME="_Toc503343024"></a><a NAME="_Toc503343125"></a><a NAME="_Toc503343370"></a><a NAME="_Toc508437329"></a></font><u><a NAME="_Toc532024555">Transfer,
Sales and Stamp Taxes</a></p>
</u>
<p>. All transfer, value added, sales and stamp taxes and similar charges, fees
and assessments incurred in connection with the Transactions or any of the
transactions contemplated by Section 5.20 (other than subsection (a) thereof),
shall be borne equally by Parent and C&A Products. Holdings and C&A
Products shall prepare and file (or cause to be filed), to the extent required
by, or permissible under, applicable Law, all necessary Tax Returns and other
documentation with respect to all such transfer, value added, sales and stamp
taxes and similar charges, fees and assessments, and, if required by applicable
Law, Parent shall join in the execution of any such Tax Returns and other
documentation as reasonably requested by Holdings.</p>
<p>&nbsp;</p>
<b>
<p ALIGN="CENTER">[</b>SIGNATURE PAGE FOLLOWS<b>]</p>
</b>
<p>IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed as of the date first above written.</p>
<table CELLSPACING="0" CELLPADDING="1" WIDTH="590">
  <tr>
    <td WIDTH="42%" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="58%" VALIGN="TOP">
      <p ALIGN="JUSTIFY">TEXTRON INC.</td>
  </tr>
  <tr>
    <td WIDTH="42%" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="58%" VALIGN="TOP">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="42%" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="58%" VALIGN="TOP">
      <p ALIGN="JUSTIFY">By:<u>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;<br>
      </u>
      &#160;&#160;&#160;&#160;Name:<br>
      &#160;&#160;&#160;&#160;Title:</p>
    </td>
  </tr>
</table>
<table CELLSPACING="0" CELLPADDING="1" WIDTH="590">
  <tr>
    <td WIDTH="42%" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="58%" VALIGN="TOP">
      <p ALIGN="JUSTIFY">COLLINS & AIKMAN CORPORATION</td>
  </tr>
  <tr>
    <td WIDTH="42%" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="58%" VALIGN="TOP">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="42%" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="58%" VALIGN="TOP">
      <p ALIGN="JUSTIFY">By:<u>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;<br>
      </u>
      &#160;&#160;&#160;&#160;Name:<br>
      &#160;&#160;&#160;&#160;Title:</p>
    </td>
  </tr>
</table>
<table CELLSPACING="0" CELLPADDING="1" WIDTH="590">
  <tr>
    <td WIDTH="42%" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="58%" VALIGN="TOP">
      <p ALIGN="JUSTIFY">COLLINS & AIKMAN PRODUCTS CO.</td>
  </tr>
  <tr>
    <td WIDTH="42%" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="58%" VALIGN="TOP">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="42%" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="58%" VALIGN="TOP">
      <p ALIGN="JUSTIFY">By:<u>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;<br>
      </u>
      &#160;&#160;&#160;&#160;Name:<br>
      &#160;&#160;&#160;&#160;Title:</p>
    </td>
  </tr>
</table>
<p>&nbsp;</p>
<i>
<p ALIGN="CENTER">Signature Page to Purchase Agreement</p>
</i><b>
<p>&nbsp;</p>
<p ALIGN="CENTER">SCHEDULE A</p>
<u>
<p ALIGN="CENTER">&nbsp;</p>
</u>
<p ALIGN="CENTER">DIRECTLY PURCHASED SUBSIDIARIES</p>
</b>
<p>&nbsp;</p>
<div align="center">
  <center>
<table CELLSPACING="0" CELLPADDING="1" WIDTH="590">
  <tr>
    <td WIDTH="66%" VALIGN="TOP"><u>
      <p ALIGN="CENTER">&nbsp;</p>
      <p ALIGN="CENTER"><br>
      Subsidiary</u></td>
    <td WIDTH="34%" VALIGN="MIDDLE">
      <p ALIGN="CENTER"><br>
      Jurisdiction</p>
      <u>
      <p ALIGN="CENTER">of Organization</u></td>
  </tr>
  <tr>
    <td WIDTH="66%" VALIGN="TOP">
      <p>&nbsp;</p>
      <p>Textron Automotive Interiors Inc.</td>
    <td WIDTH="34%" VALIGN="TOP">
      <p ALIGN="CENTER">&nbsp;</p>
      <p ALIGN="CENTER">Delaware</td>
  </tr>
  <tr>
    <td WIDTH="66%" VALIGN="TOP">
      <p>Textron S.A. de C.V.</td>
    <td WIDTH="34%" VALIGN="TOP">
      <p ALIGN="CENTER">Mexico</td>
  </tr>
  <tr>
    <td WIDTH="66%" VALIGN="TOP">
      <p>Textron Properties Inc.</td>
    <td WIDTH="34%" VALIGN="MIDDLE">
      <p ALIGN="CENTER">Delaware</td>
  </tr>
  <tr>
    <td WIDTH="66%" VALIGN="TOP">
      <p>Textron Automotive MIP Limited</td>
    <td WIDTH="34%" VALIGN="TOP">
      <p ALIGN="CENTER">United Kingdom</td>
  </tr>
  <tr>
    <td WIDTH="66%" VALIGN="TOP">
      <p>Permali do Brasil Industria e Comercio Ltda.</td>
    <td WIDTH="34%" VALIGN="TOP">
      <p ALIGN="CENTER">Brazil</td>
  </tr>
  <tr>
    <td WIDTH="66%" VALIGN="TOP">
      <p>Textron Automotive Belgium B.V.B.A.</td>
    <td WIDTH="34%" VALIGN="TOP">
      <p ALIGN="CENTER">Belgium</td>
  </tr>
  <tr>
    <td WIDTH="66%" VALIGN="TOP">
      <p>Textron Automotive B.V.</td>
    <td WIDTH="34%" VALIGN="MIDDLE">
      <p ALIGN="CENTER">Netherlands</td>
  </tr>
  <tr>
    <td WIDTH="66%" VALIGN="TOP">
      <p>Textron Automotive Holdings Italy S.r.l.</td>
    <td WIDTH="34%" VALIGN="TOP">
      <p ALIGN="CENTER">Italy</td>
  </tr>
</table>
  </center>
</div>
<p>&nbsp;</p>
<p>&nbsp;</p>
<b>
<p ALIGN="RIGHT">&nbsp;</p>
<p ALIGN="CENTER">SCHEDULE B</p>
<p ALIGN="CENTER">&nbsp;</p>
<p ALIGN="CENTER">SUBSIDIARIES OF THE DIRECTLY PURCHASED SUBSIDIARIES</p>
</b>
<p>&nbsp;</p>
<div align="center">
  <center>
<table CELLSPACING="0" CELLPADDING="1" WIDTH="590">
  <tr>
    <td WIDTH="35%" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="CENTER">&nbsp;</p>
      <u>
      <p ALIGN="CENTER">Directly Purchased Subsidiary</u></font></td>
    <td WIDTH="35%" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="CENTER"><br>
      <u>Subsidiary</u></font></td>
    <td WIDTH="30%" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="CENTER">Jurisdiction</p>
      <u>
      <p ALIGN="CENTER">of Organization</u></font></td>
  </tr>
  <tr>
    <td WIDTH="35%" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="35%" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="30%" VALIGN="TOP">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="35%" VALIGN="TOP"><font SIZE="3">
      <p>Textron Automotive Holdings Italy S.r.l.</font></td>
    <td WIDTH="35%" VALIGN="TOP"><font SIZE="3">
      <p>Textron Automotive Company Italia S.r.l.<sup>1</sup> (formerly, Textron
      Breed Automotive S.r.l.)</p>
      </font></td>
    <td WIDTH="30%" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="CENTER">Italy</font></td>
  </tr>
  <tr>
    <td WIDTH="35%" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="35%" VALIGN="TOP"><font SIZE="3">
      <p>A.P.C.O. &#45; Advanced Plastic Company S.r.l.</p>
      </font></td>
    <td WIDTH="30%" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="CENTER">Italy</font></td>
  </tr>
  <tr>
    <td WIDTH="35%" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="35%" VALIGN="TOP"><font SIZE="3">
      <p>FAS S.p.A.</p>
      </font></td>
    <td WIDTH="30%" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="CENTER">Italy</font></td>
  </tr>
  <tr>
    <td WIDTH="35%" VALIGN="TOP"><font SIZE="3">
      <p>Textron Automotive B.V.</font></td>
    <td WIDTH="35%" VALIGN="TOP"><font SIZE="3">
      <p>Textron Automotive Moravia s.r.o.</p>
      </font></td>
    <td WIDTH="30%" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="CENTER">Czech Republic</font></td>
  </tr>
  <tr>
    <td WIDTH="35%" VALIGN="TOP"><font SIZE="3">
      <p>Permali do Brasil Industria e Comercio Ltda.</font></td>
    <td WIDTH="35%" VALIGN="TOP"><font SIZE="3">
      <p>Rosario Project S.A.</p>
      <p></font></td>
    <td WIDTH="30%" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="CENTER">Argentina</font></td>
  </tr>
  <tr>
    <td WIDTH="35%" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="35%" VALIGN="TOP"><font SIZE="3">
      <p>Plascar Participacoes Industriais S.A.<sup> 2</p>
      </sup></font></td>
    <td WIDTH="30%" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="CENTER">Brazil</font></td>
  </tr>
  <tr>
    <td WIDTH="35%" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="35%" VALIGN="TOP"><font SIZE="3">
      <p>Textron Automotive Trim Brasil Ltda.<sup>3</p>
      </sup>
      <p></font></td>
    <td WIDTH="30%" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="CENTER">Brazil</font></td>
  </tr>
  <tr>
    <td WIDTH="35%" VALIGN="TOP"><font SIZE="3">
      <p>Textron Automotive MIP Limited</font></td>
    <td WIDTH="35%" VALIGN="TOP"><font SIZE="3">
      <p>AS Textron Ltd.</p>
      </font></td>
    <td WIDTH="30%" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="CENTER">United Kingdom</font></td>
  </tr>
  <tr>
    <td WIDTH="35%" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="35%" VALIGN="TOP"><font SIZE="3">
      <p>Textron Automotive Ltd.</p>
      </font></td>
    <td WIDTH="30%" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="CENTER">United Kingdom</font></td>
  </tr>
  <tr>
    <td WIDTH="35%" VALIGN="TOP"><font SIZE="3">
      <p>Textron Automotive Interiors Inc.</font></td>
    <td WIDTH="35%" VALIGN="TOP"><font SIZE="3">
      <p>Textron Automotive (Asia) Inc.</p>
      </font></td>
    <td WIDTH="30%" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="CENTER">Delaware</font></td>
  </tr>
  <tr>
    <td WIDTH="35%" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="35%" VALIGN="TOP"><font SIZE="3">
      <p>Textron Automotive (Argentina) Inc.</p>
      </font></td>
    <td WIDTH="30%" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="CENTER">Delaware</p>
      <p ALIGN="CENTER"></font></td>
  </tr>
</table>
  </center>
  </div>
<sup><font SIZE="3">
<p>1</font></sup><font SIZE="2"> 10% of the issued and outstanding shares of
capital stock of Textron Automotive Company Italia S.r.l. are owned by Magneti
Marelli Holding S.p.A. Parent may cause Textron International Holdings Italy
S.r.l. to purchase the shares of capital stock of Textron Automotive Company
Italia S.r.l. held by Magneti Marelli Holding S.p.A. prior to the Closing.</p>
</font><sup><font SIZE="3">
<p>2</font></sup><font SIZE="2"> Preferred shares representing 43.4% of the
issued and outstanding shares of capital stock of Plascar Participacoes
Industriais S.A. are publicly held.</p>
</font><sup><font SIZE="3">
<p>3</font></sup> Approximately 0.5% of the issued and outstanding shares of
capital stock of Textron Automotive Trim Brasil Ltda., which is a subsidiary of
Plascar Participacoes Industriais S.A., are owned by Textron International
Holding S.L.</p>
<p>&nbsp;</p>
  <div align="center">
    <center>
<table CELLSPACING="0" CELLPADDING="1" WIDTH="590">
  <tr>
    <td WIDTH="35%" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="35%" VALIGN="TOP"><font SIZE="3">
      <p>Riopelle Realty Ltd.</p>
      </font></td>
    <td WIDTH="30%" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="CENTER">Ontario</font></td>
  </tr>
  <tr>
    <td WIDTH="35%" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="35%" VALIGN="TOP"><font SIZE="3">
      <p>Textron Automotive Overseas Investment Inc.</p>
      </font></td>
    <td WIDTH="30%" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="CENTER">Delaware</font></td>
  </tr>
  <tr>
    <td WIDTH="35%" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="35%" VALIGN="TOP"><font SIZE="3">
      <p>Textron Automotive International Services Inc.</p>
      </font></td>
    <td WIDTH="30%" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="CENTER">Delaware</p>
      <p ALIGN="CENTER"></font></td>
  </tr>
  <tr>
    <td WIDTH="35%" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="35%" VALIGN="TOP"><font SIZE="3">
      <p>M&C Advanced Processes, Inc.</p>
      <p></font></td>
    <td WIDTH="30%" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="CENTER">Michigan</font></td>
  </tr>
  <tr>
    <td WIDTH="35%" VALIGN="TOP"><font SIZE="3">
      <p>Textron S.A. de C.V.</font></td>
    <td WIDTH="35%" VALIGN="TOP"><font SIZE="3">
      <p>Textron Executive Services Mexico, S.A. de C.V.</p>
      </font></td>
    <td WIDTH="30%" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="CENTER">Mexico</font></td>
  </tr>
  <tr>
    <td WIDTH="35%" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="35%" VALIGN="TOP"><font SIZE="3">
      <p>Textron Automotive Management Services Company de Cuautitlan, S.A. de
      C.V.</p>
      </font></td>
    <td WIDTH="30%" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="CENTER">Mexico</font></td>
  </tr>
  <tr>
    <td WIDTH="35%" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="35%" VALIGN="TOP"><font SIZE="3">
      <p>Textron Automotive Company de Mexico, S. A. de C.V. <sup>4</p>
      </sup></font></td>
    <td WIDTH="30%" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="CENTER">Mexico</font></td>
  </tr>
  <tr>
    <td WIDTH="35%" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="35%" VALIGN="TOP"><font SIZE="3">
      <p>Textron Automotive Management Services Company Mexico, S.A. de C.V.<sup>
      5</p>
      </sup></font></td>
    <td WIDTH="30%" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="CENTER">Mexico</font></td>
  </tr>
  <tr>
    <td WIDTH="35%" VALIGN="TOP"><font SIZE="3">
      <p>Textron Automotive Belgium B.V.B.A.</font></td>
    <td WIDTH="35%" VALIGN="TOP"><font SIZE="3">
      <p>Textron Automotive Germany GmbH</font></td>
    <td WIDTH="30%" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="CENTER">Germany</font></td>
  </tr>
  <tr>
    <td WIDTH="35%" VALIGN="TOP"><font SIZE="3">
      <p>Textron Properties Inc.</font></td>
    <td WIDTH="35%" VALIGN="TOP"><font SIZE="3">
      <p>Textron Canada Limited</font></td>
    <td WIDTH="30%" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="CENTER">&nbsp;</p>
      <p ALIGN="CENTER">Canada</font></td>
  </tr>
</table>
  </center>
    </div>
<sup>
<p>4</sup> <font SIZE="2">Approximately .01% of the issued and outstanding
shares of capital stock of Textron Automotive Company de Mexico, S.A. de C.V.
are owned by Textron Inc.</p>
</font><sup>
<p>5</sup> Approximately 2% of the issued and outstanding shares of capital
stock of Textron Automotive Management Services Company Mexico, S.A. de C.V.,
which is a subsidiary of Textron Automotive Company de Mexico, S.A. de C.V., are
owned by Textron Inc.</p>
<b>
<p ALIGN="CENTER">SCHEDULE C</p>
<p ALIGN="CENTER">&nbsp;</p>
<p ALIGN="CENTER">RESTRUCTURING</p>
</b>
<p>&nbsp;</p>
<blockquote>
  <blockquote>
    <p>1.&#160;&#160;&#160;&#160;&#160;The following
    subsidiaries and businesses and their related assets and liabilities will be
    divested from the Bison Subsidiaries prior to Closing:</p>
    <p>Kautex Textron de Mexico S.A. de C.V. (which owns Kautex Textron
    Management Services Company de Puebla S.A. de C.V.)</p>
<p>Camcar Textron de Mexico S.A. de C.V.</p>
<p>49% interest in Helicopteros Bell de Mexico s.r.l.</p>
<p>Abuco Inc.</p>
<p>Bell Helicopter Canada International Ltd.</p>
<p>Kautex Corporation (Canada)</p>
<p>3724140 Canada Inc.</p>
<p>Bell Calgary division</p>
<p>Bell Mirabel division</p>
<p>Avdel Canada division</p>
<p>Flexalloy Canada division</p>
<p>Camcar Canada division</p>
<p>Greenlee Canada division</p>
    <p>&#160;BHTC Properties Company</p>
  </blockquote>
</blockquote>
<p>&#160;&#160;&#160;&#160;&#160;Assets and liabilities of
A.P.C.O. Advanced Plastic Company relating to the operations of the Kautex Unit
of Textron Automotive Company Inc. (for their book value).</p>
<p>&#160;&#160;&#160;&#160;&#160;In addition, Parent will
retain ownership to the intellectual property set forth on Section C&#45;1
of the Disclosure Schedule.</p>
<blockquote>
  <blockquote>
    <p>2.&#160;&#160;&#160;&#160;&#160;Prior to the Closing,
    except as otherwise agreed by Parent and Holdings, employees of Textron
    Automotive Company Inc. (&quot;TAC&quot;) whose entire salaries are directly
    charged to the Trim Division shall be transferred to a Bison Subsidiary.</p>
    <p>3.&#160;&#160;&#160;&#160;&#160;Immediately after
    Closing, Textron Automotive Company Inc. will assign its 49% interest in
    Synova Plastics LLC to Holdings or a Subsidiary of Holdings. (51% of the
    membership interest in Synova Plastics LLC is owned by Jackson Plastics
    Inc.)</p>
    <p>4.&#160;&#160;&#160;&#160;&#160;The following assets
    and liabilities will be transferred to a Bison Subsidiary on or before the
    Closing Date:</p>
    <blockquote>
      <blockquote>
        <p>(a)&#160;&#160;&#160;&#160;&#160;assets and
        liabilities (other than Contracts) which are used primarily in or relate
        primarily to the Business including the following:</p>
        <blockquote>
          <blockquote>
            <p>(i)&#160;&#160;&#160;&#160;&#160;to the
            extent permitted by law, assets and liabilities reflected on the
            December 30, 2000 Statement of Net Assets to be sold, which is part
            of the Financial Statements, which have not been disposed of or
            satisfied subsequent to December 30, 2000 and which are in the name
            of a Non&#45;Bison Subsidiary; excluding, however, the assets
            being transferred pursuant to Section 2.2(a) of the Purchase
            Agreement; and</p>
            <p>(ii)&#160;&#160;&#160;&#160;&#160;to the
            extent permitted by law, assets and liabilities acquired or incurred
            subsequent to December 30, 2000 which (i) have not been disposed or
            satisfied prior to the Closing Date, (ii) are in the name of a
            Non&#45;Bison Subsidiary and (iii) which are used primarily in
            or relate primarily to the business of a Bison Subsidiary;</p>
          </blockquote>
        </blockquote>
        <p>(b)&#160;&#160;&#160;&#160;&#160;Contracts
        relating solely to the business of a Bison Subsidiary which are in the
        name of a Non&#45;Bison Subsidiary and which can be assigned on or
        before the Closing Date;</p>
        <p>(c)&#160;&#160;&#160;&#160;&#160;Contracts
        currently in effect with a customer of the Business which can be
        assigned on or before the Closing Date; and</p>
        <p>(d)&#160;&#160;&#160;&#160;&#160;intellectual
        property listed on Section C&#45;2 of the Disclosure Schedule which
        is in the name of a Non&#45;Bison Subsidiary; excluding, however,
        the assets being transferred pursuant to Section 2.2(a) of the Purchase
        Agreement. (This list includes intellectual property currently held in
        the name of Bison Subsidiaries as well as intellectual property
        currently held in the name of Non&#45;Bison Subsidiaries.) (In
        connection with this transfer of intellectual property, M&C Michigan
        Inc., a wholly owned subsidiary of M&C Advanced Processes, Inc.,
        will withdraw its limited partnership interest in Textron Innovations
        L.P. and will subsequently be dissolved.)</p>
      </blockquote>
    </blockquote>
    <p>5.&#160;&#160;&#160;&#160;&#160;Title to the real
    property covered by the deeds identified in Section 5.4(c) part A of the
    Disclosure Schedule (other than such real property that is the subject of
    the transactions contemplated by Section 5.21) will be transferred on or
    before the Closing Date to a Bison Subsidiary.</p>
  </blockquote>
</blockquote>
<b>
<p ALIGN="CENTER">SCHEDULE D</p>
<p ALIGN="CENTER">&nbsp;</p>
<p ALIGN="CENTER">ALLOCATION OF PURCHASE PRICE</p>
</b>
<p>This schedule assumes Balance Sheet Indebtedness on the Closing Date is $76.9
million.</p>
    <div align="center">
      <center>
<table CELLSPACING="1" CELLPADDING="1" WIDTH="475">
  <tr>
    <td WIDTH="65%" VALIGN="TOP"><b>
      <p>Directly Purchased Subsidiary</b></td>
    <td WIDTH="35%" VALIGN="TOP"><b>
      <p>Fair Market Value of Interest Being Sold (in USD millions)</b></td>
  </tr>
  <tr>
    <td WIDTH="65%" VALIGN="TOP">
      <p>Textron Automotive Belgium B.V.B.A.</p>
    </td>
    <td WIDTH="35%" VALIGN="TOP">
      <blockquote>
        <blockquote>
          <p>20
        </blockquote>
      </blockquote>
    </td>
  </tr>
  <tr>
    <td WIDTH="65%" VALIGN="TOP">
      <p>Permali do Brasil Industria e Comercio Ltda.</p>
    </td>
    <td WIDTH="35%" VALIGN="TOP">
      <blockquote>
        <blockquote>
          <p>5
        </blockquote>
      </blockquote>
    </td>
  </tr>
  <tr>
    <td WIDTH="65%" VALIGN="TOP">
      <p>Textron Properties Inc.</p>
    </td>
    <td WIDTH="35%" VALIGN="TOP">
      <blockquote>
        <blockquote>
          <p>275<sup>1
          </blockquote>
        </blockquote>
      </sup></td>
  </tr>
  <tr>
    <td WIDTH="65%" VALIGN="TOP">
      <p>Textron Automotive Holdings Italy S.r.l.</p>
    </td>
    <td WIDTH="35%" VALIGN="TOP">
      <blockquote>
        <blockquote>
          <p>22
        </blockquote>
      </blockquote>
    </td>
  </tr>
  <tr>
    <td WIDTH="65%" VALIGN="TOP">
      <p>Textron S.A. de C.V.</p>
    </td>
    <td WIDTH="35%" VALIGN="TOP">
      <blockquote>
        <blockquote>
          <p>80
        </blockquote>
      </blockquote>
    </td>
  </tr>
  <tr>
    <td WIDTH="65%" VALIGN="TOP">
      <p>Textron Automotive B.V.</p>
    </td>
    <td WIDTH="35%" VALIGN="TOP">
      <blockquote>
        <blockquote>
          <p>40
        </blockquote>
      </blockquote>
    </td>
  </tr>
  <tr>
    <td WIDTH="65%" VALIGN="TOP">
      <p>Textron Automotive MIP Limited</p>
    </td>
    <td WIDTH="35%" VALIGN="TOP">
      <blockquote>
        <blockquote>
          <p>18
        </blockquote>
      </blockquote>
    </td>
  </tr>
  <tr>
    <td WIDTH="65%" VALIGN="TOP">
      <p>Textron Automotive Interiors Inc.</p>
    </td>
    <td WIDTH="35%" VALIGN="TOP">
      <blockquote>
        <blockquote>
          <p>247<sup>2
          </blockquote>
        </blockquote>
      </sup></td>
  </tr>
  <tr>
    <td WIDTH="65%" VALIGN="TOP"><b>
      <p><a NAME="_Toc521330806"></a><a NAME="_Toc521426519"></a><a NAME="_Toc521468918"></a><a NAME="_Toc521492969"></a><a NAME="_Toc529706250"></a><a NAME="_Toc529947439"></a><a NAME="_Toc530205160"></a><a NAME="_Toc530215765"></a><a NAME="_Toc530801323"></a><a NAME="_Toc531699917"></a><a NAME="_Toc531774305"></a><a NAME="_Toc531805719"></a><a NAME="_Toc532024556">Total</a></b></td>
    <td WIDTH="35%" VALIGN="TOP"><b>
      <blockquote>
        <blockquote>
          <p>707
        </blockquote>
      </blockquote>
      </b></td>
  </tr>
</table>
      </center>
    </div>
<sup>
<p>1</sup><font SIZE="2">Before distribution of $19,900,000 received pursuant to
the sales specified in Section 5.21.</p>
</font><sup>
<p>2</sup>Before distribution of $32,923,655 received pursuant to the sales
specified in Section 5.21.</p>
<b>
<p ALIGN="CENTER">SCHEDULE E</p>
<p ALIGN="CENTER">&nbsp;</p>
<p ALIGN="CENTER">SUBSIDIARIES OF COLLINS & AIKMAN CORPORATION</p>
</b>
  <div align="center">
<center>
<table CELLSPACING="0" CELLPADDING="1" WIDTH="698">
  <tr>
    <td WIDTH="595" VALIGN="TOP"><b><u>
      <p>Company</u></b></td>
    <td WIDTH="160" VALIGN="TOP"><b><u>
      <p ALIGN="CENTER">Jurisdiction</u></b></td>
    <td WIDTH="69" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="595" VALIGN="TOP"><font SIZE="3">
      <p>Collins & Aikman Products Co.</font></td>
    <td WIDTH="160" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Delaware</font></td>
    <td WIDTH="69" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="595" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;Carcorp, Inc.</font></td>
    <td WIDTH="160" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Delaware</font></td>
    <td WIDTH="69" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="595" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;Collins & Aikman
      Accessory Mats, Inc.</font></td>
    <td WIDTH="160" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Delaware</font></td>
    <td WIDTH="69" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="595" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Akro
      Mats, LLC</font></td>
    <td WIDTH="160" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Delaware</font></td>
    <td WIDTH="69" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="595" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Collins
      & Aikman Automotive Mats, LLC</font></td>
    <td WIDTH="160" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Delaware</font></td>
    <td WIDTH="69" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="595" VALIGN="TOP"><font SIZE="3">
      <p>Collins & Aikman Advanced Processes, Inc.</font></td>
    <td WIDTH="160" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Delaware</font></td>
    <td WIDTH="69" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="595" VALIGN="TOP"><font SIZE="3">
      <p>Collins & Aikman Asset Services, Inc.</font></td>
    <td WIDTH="160" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Delaware</font></td>
    <td WIDTH="69" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="595" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;CW
      Management Corporation<sup>1</sup></font></td>
    <td WIDTH="160" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Delaware</font></td>
    <td WIDTH="69" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="595" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Hopkins
      Services, Inc.<sup>2</sup></font></td>
    <td WIDTH="160" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Minnesota</font></td>
    <td WIDTH="69" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="595" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;SAF
      Services Corporation<sup>3</sup></font></td>
    <td WIDTH="160" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Delaware</font></td>
    <td WIDTH="69" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="595" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;Collins & Aikman
      Automotive International, Inc</font></td>
    <td WIDTH="160" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Delaware</font></td>
    <td WIDTH="69" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="595" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;Collins & Aikman
      Canada Domestic Holding Company</font></td>
    <td WIDTH="160" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Delaware</font></td>
    <td WIDTH="69" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="595" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;C&A
      Canada Holding Company</font></td>
    <td WIDTH="160" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Canada</font></td>
    <td WIDTH="69" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="595" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;Collins & Aikman
      Carpet & Acoustics (MI), Inc.</font></td>
    <td WIDTH="160" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Delaware</font></td>
    <td WIDTH="69" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="595" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;Collins & Aikman
      Carpet & Acoustics (TN), Inc.</font></td>
    <td WIDTH="160" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Tennessee</font></td>
    <td WIDTH="69" VALIGN="TOP"></td>
  </tr>
    <center>
  <tr>
    <td WIDTH="595" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;Collins & Aikman
      Development Company</font></td>
    <td WIDTH="160" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Delaware</font></td>
    <td WIDTH="69" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="595" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;Collins & Aikman
      Export Corporation</font></td>
    <td WIDTH="160" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">U.S. Virgin Isles</font></td>
    <td WIDTH="69" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="595" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;Collins & Aikman
      Fabrics, Inc.</font></td>
    <td WIDTH="160" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Delaware</font></td>
    <td WIDTH="69" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="595" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;Collins & Aikman
      Holdings Canada Inc.</font></td>
    <td WIDTH="160" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Canada</font></td>
    <td WIDTH="69" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="595" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Collins
      & Aikman Canada Inc.</font></td>
    <td WIDTH="160" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Canada</font></td>
    <td WIDTH="69" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="595" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;C
      & A Canada International Holdings Limited<sup>4</sup></font></td>
    <td WIDTH="160" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Canada</font></td>
    <td WIDTH="69" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="595" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Collins
      & Aikman Luxembourg, S.A.</font></td>
    <td WIDTH="160" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Luxembourg</font></td>
    <td WIDTH="69" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="595" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Imperial
      Wallcoverings (Canada) Inc.</font></td>
    <td WIDTH="160" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Canada</font></td>
    <td WIDTH="69" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="595" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;Collins & Aikman
      Interiors, Inc.</font></td>
    <td WIDTH="160" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Delaware</font></td>
    <td WIDTH="69" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="595" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;Collins & Aikman
      International Corporation</font></td>
    <td WIDTH="160" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Delaware</font></td>
    <td WIDTH="69" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="595" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Collins
      & Aikman Europe, Inc.</font></td>
    <td WIDTH="160" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Delaware</font></td>
    <td WIDTH="69" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="595" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Collins
      & Aikman (Gibraltar) Limited</font></td>
    <td WIDTH="160" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Gibraltar/Delaware</font></td>
    <td WIDTH="69" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="595" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;C
      & A Canada International Holding Company</font></td>
    <td WIDTH="160" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Canada</font></td>
    <td WIDTH="69" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="595" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Collins
      & Aikman Europe S.A.<sup>5</sup></font></td>
    <td WIDTH="160" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Luxembourg</font></td>
    <td WIDTH="69" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="595" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;C&A
      (Gibraltar)</font></td>
    <td WIDTH="160" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Gibraltar</font></td>
    <td WIDTH="69" VALIGN="TOP"></td>
  </tr>
</table>
</center>
    </center>
  </div>
<sup><font SIZE="3">
<p>1</font></sup><font SIZE="3"> 10% owned by Willis Corroon Corporation of
North Carolina</p>
<sup>
<p>2</sup> 10% owned by O&#39;Brien & Gere of North America, Inc.</p>
<sup>
<p>3</sup> 10% owned by Unicare, Inc.</p>
<sup>
<p>4</sup> 50% owned by Collins & Aikman Plastics, Ltd.</p>
<sup>
<p>5</sup> 30% owned by Collins & Aikman Luxembourg, S.A; 49% by Collins
& Aikman (Gibraltar) Ltd.</p>
<p>&nbsp;</p>
<p>&nbsp;</p>
</font>
<div align="center">
<center>
<table CELLSPACING="0" CELLPADDING="1" WIDTH="744">
  <tr>
    <td WIDTH="644" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;C&A
      (Gibraltar) No. 2</font></td>
    <td WIDTH="159" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Gibraltar</font></td>
    <td WIDTH="69" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="644" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Collins
      & Aikman Automotive Holding GmbH</font></td>
    <td WIDTH="159" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Germany</font></td>
    <td WIDTH="69" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="644" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Collins
      & Aikman Automotive Systems GmbH</font></td>
    <td WIDTH="159" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Germany</font></td>
    <td WIDTH="69" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="644" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Dura
      Convertible Systems GmbH</font></td>
    <td WIDTH="159" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Germany</font></td>
    <td WIDTH="69" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="644" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Collins
      & Aikman Automotive Systems Italy S.r.l. <sup>6</sup></font></td>
    <td WIDTH="159" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Italy</font></td>
    <td WIDTH="69" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="644" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Collins
      & Aikman Automotive Systems N.V. <sup>7</sup></font></td>
    <td WIDTH="159" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Belgium</font></td>
    <td WIDTH="69" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="644" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Collins
      & Aikman Automotive Systems S.L. <sup>8</sup></font></td>
    <td WIDTH="159" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Spain</font></td>
    <td WIDTH="69" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="644" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Collins
      & Aikman Europe B.V.</font></td>
    <td WIDTH="159" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Netherlands</font></td>
    <td WIDTH="69" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="644" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Collins
      & Aikman Automotive Floormats Europe, B.V.</font></td>
    <td WIDTH="159" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Netherlands</font></td>
    <td WIDTH="69" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="644" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Collins
      & Aikman Holding AB</font></td>
    <td WIDTH="159" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Sweden</font></td>
    <td WIDTH="69" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="644" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Collins
      & Aikman Automotive Systems AB</font></td>
    <td WIDTH="159" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Sweden</font></td>
    <td WIDTH="69" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="644" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Collins
      & Aikman Products GmbH</font></td>
    <td WIDTH="159" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Austria</font></td>
    <td WIDTH="69" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="644" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Collins
      & Aikman Holdings Limited</font></td>
    <td WIDTH="159" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">United Kingdom</font></td>
    <td WIDTH="69" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="644" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Collins
      & Aikman Automotive Fabrics Limited</font></td>
    <td WIDTH="159" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">United Kingdom</font></td>
    <td WIDTH="69" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="644" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Collins
      & Aikman Automotive Interior Systems Europe Limited</font></td>
    <td WIDTH="159" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">United Kingdom</font></td>
    <td WIDTH="69" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="644" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Collins
      & Aikman Automotive Systems Limited</font></td>
    <td WIDTH="159" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">United Kingdom</font></td>
    <td WIDTH="69" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="644" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Collins
      & Aikman Automotive Carpet Products (UK) Limited</font></td>
    <td WIDTH="159" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">United Kingdom</font></td>
    <td WIDTH="69" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="644" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Abex
      Plastic Products Limited</font></td>
    <td WIDTH="159" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">United Kingdom</font></td>
    <td WIDTH="69" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="644" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Manchester
      Kigass International Limited</font></td>
    <td WIDTH="159" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">United Kingdom</font></td>
    <td WIDTH="69" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="644" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Premier
      Springs & Pressings Limited</font></td>
    <td WIDTH="159" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">United Kingdom</font></td>
    <td WIDTH="69" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="644" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Collins
      & Aikman Holdings, S.A. de C.V. <sup>9</sup></font></td>
    <td WIDTH="159" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Mexico</font></td>
    <td WIDTH="69" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="644" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Amco
      de Mexico, S.A. de C.V.</font></td>
    <td WIDTH="159" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Mexico</font></td>
    <td WIDTH="69" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="644" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Collins
      & Aikman de Mexico, S.A. de C.V.<sup>10</sup></font></td>
    <td WIDTH="159" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Mexico</font></td>
    <td WIDTH="69" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="644" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Collins
      & Aikman Carpet & Acoustics, S.A. de C.V.<sup>11</sup></font></td>
    <td WIDTH="159" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Mexico</font></td>
    <td WIDTH="69" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="644" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Dura
      Convertible Systems de Mexico, S.A. de C.V.<sup>12</sup></font></td>
    <td WIDTH="159" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Mexico</font></td>
    <td WIDTH="69" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="644" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Industrias
      Enjema, S.A. de C.V.<sup>13</sup></font></td>
    <td WIDTH="159" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Mexico</font></td>
    <td WIDTH="69" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="644" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Servitop,
      S.A. de C.V.<sup>14</sup></font></td>
    <td WIDTH="159" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Mexico</font></td>
    <td WIDTH="69" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="644" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Servitrim,
      S.A. de C.V. <sup>15</sup></font></td>
    <td WIDTH="159" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Mexico</font></td>
    <td WIDTH="69" VALIGN="TOP"></td>
  </tr>
</table>
</center>
</div>
<sup><font SIZE="3">
<p>6</font></sup><font SIZE="3"> 25% owned by Collins & Aikman Europe B.V.</p>
</font><sup><font SIZE="3">
<p>7</font></sup><font SIZE="3"> Ten shares owned by Collins & Aikman
Automotive Systems AB</p>
<sup>
<p>8</sup> One share owned by Collins & Aikman Holdings Limited</p>
<sup>
<p>9</sup> One share owned by Habinus Trading Company</p>
<sup>
<p>10</sup> One share owned by Collins & Aikman Accessory Mats, Inc.</p>
<sup>
<p>11</sup> One share of Series &quot;A&quot; owned by Collins & Aikman
International Corporation</p>
<sup>
<p>12</sup> One share owned by Dura Convertible Systems, Inc.</p>
<sup>
<p>13</sup> One share owned by Collins & Aikman International Corporation</p>
<sup>
<p>14</sup> One share owned by Amco de Mexico, S.A. de C.V.</p>
<sup>
<p>15</sup> One share owned by Dura Convertible Systems de Mexico, S.A. de C.V.</p>
</font>
<div align="center">
<center>
<table CELLSPACING="0" CELLPADDING="1" WIDTH="743">
  <tr>
    <td WIDTH="507" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;Collins & Aikman
      Plastics, Inc.&#160;&#160;&#160;&#160;&#160;</font></td>
    <td WIDTH="154" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Delaware</font></td>
    <td WIDTH="70" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="507" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Aguirre,
      Collins & Aikman Plastics, L.L.C. <sup>16</sup></font></td>
    <td WIDTH="154" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Michigan</font></td>
    <td WIDTH="70" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="507" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Becker
      Group, LLC</font></td>
    <td WIDTH="154" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Michigan</font></td>
    <td WIDTH="70" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="507" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Brut
      Plastics, Inc.</font></td>
    <td WIDTH="154" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Michigan</font></td>
    <td WIDTH="70" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="507" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Engineered
      Plastic Products, Inc. <sup>17</sup></font></td>
    <td WIDTH="154" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Michigan</font></td>
    <td WIDTH="70" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="507" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Collins
      & Aikman Plastics, Ltd.</font></td>
    <td WIDTH="154" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Canada</font></td>
    <td WIDTH="70" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="507" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;Collins & Aikman
      Properties, Inc.</font></td>
    <td WIDTH="154" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Delaware</font></td>
    <td WIDTH="70" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="507" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;Comet Acoustics, Inc.</font></td>
    <td WIDTH="154" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Delaware</font></td>
    <td WIDTH="70" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="507" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;Dura Convertible
      Systems, Inc.&#160;&#160;&#160;&#160;&#160;</font></td>
    <td WIDTH="154" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Delaware</font></td>
    <td WIDTH="70" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="507" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Amco
      Convertible Fabrics, Inc.</font></td>
    <td WIDTH="154" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Delaware</font></td>
    <td WIDTH="70" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="507" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;Gamble Development
      Company</font></td>
    <td WIDTH="154" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Minnesota</font></td>
    <td WIDTH="70" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="507" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;Grefab, Inc.</font></td>
    <td WIDTH="154" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">New York</font></td>
    <td WIDTH="70" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="507" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;JPS Automotive, Inc.</font></td>
    <td WIDTH="154" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Delaware</font></td>
    <td WIDTH="70" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="507" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;JPS
      Automotive Products Corp.</font></td>
    <td WIDTH="154" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Delaware</font></td>
    <td WIDTH="70" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="507" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;Waterstone Insurance,
      Inc.</font></td>
    <td WIDTH="154" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Vermont</font></td>
    <td WIDTH="70" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="507" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;Wickes Asset
      Management, Inc.</font></td>
    <td WIDTH="154" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Delaware</font></td>
    <td WIDTH="70" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="507" VALIGN="TOP"><font SIZE="3">
      <p>&#160;&#160;&#160;&#160;&#160;Wickes Manufacturing
      Company</font></td>
    <td WIDTH="154" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">Delaware</font></td>
    <td WIDTH="70" VALIGN="TOP"></td>
  </tr>
</table>
</center>
</div>
<font SIZE="3">
<p>&nbsp;</p>
<b><u>
<p ALIGN="CENTER">Non&#45;Profit Corporations</p>
</u></b></font>
<div align="center">
<center>
<table CELLSPACING="0" CELLPADDING="1" WIDTH="743">
  <tr>
    <td WIDTH="505" VALIGN="TOP"><font SIZE="3">
      <p>Collins & Aikman Foundation</font></td>
    <td WIDTH="158" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">California</font></td>
    <td WIDTH="68" VALIGN="TOP"></td>
  </tr>
  <tr>
    <td WIDTH="505" VALIGN="TOP"><font SIZE="3">
      <p>Collins & Aikman Disaster Relief Fund, Inc.</font></td>
    <td WIDTH="158" VALIGN="TOP"><font SIZE="3">
      <p ALIGN="RIGHT" style="margin-right: 20">North Carolina</font></td>
    <td WIDTH="68" VALIGN="TOP"></td>
  </tr>
</table>
</center>
</div>
<p>&nbsp;</p>
<sup><font SIZE="3">
<p>16</font></sup><font SIZE="2"> 53% owned by Mexican Industries in Michigan,
Inc.</p>
</font><sup><font SIZE="3">
<p>17</font></sup><font SIZE="3"> 55% owned by Gerald Edwards</p>
</font><b>
<p ALIGN="CENTER">SCHEDULE F</p>
<p ALIGN="CENTER">&nbsp;</p>
<p ALIGN="CENTER">ACQUIRING ENTITIES</p>
</b>
<div align="center">
  <center>
<table CELLSPACING="0" CELLPADDING="1" WIDTH="613">
  <tr>
    <td WIDTH="51%" VALIGN="BOTTOM" HEIGHT="48"><b><u>
      <p ALIGN="JUSTIFY"><a NAME="SendMailTemp"></a>Target&#160;&#160;&#160;&#160;&#160;</p>
      </u></b></td>
    <td WIDTH="49%" VALIGN="BOTTOM" HEIGHT="48"><b><u>
      <p>Acquirer</p>
      </u></b></td>
  </tr>
  <tr>
    <td WIDTH="51%" VALIGN="TOP" HEIGHT="48">
      <p>TAC Inc. Intangibles</p>
    </td>
    <td WIDTH="49%" VALIGN="TOP" HEIGHT="48">
      <p>Collins & Aikman Development Company</p>
    </td>
  </tr>
  <tr>
    <td WIDTH="51%" VALIGN="TOP" HEIGHT="48">
      <p>Textron Automotive Belgium B.V.B.A.</p>
    </td>
    <td WIDTH="49%" VALIGN="TOP" HEIGHT="48">
      <p>Collins & Aikman Automotive Systems NV</p>
    </td>
  </tr>
  <tr>
    <td WIDTH="51%" VALIGN="TOP" HEIGHT="48">
      <p>Permali do Brasil Industria e Comercio Ltda</p>
    </td>
    <td WIDTH="49%" VALIGN="TOP" HEIGHT="48">
      <p>Collins & Aikman Europe S.A., and minority interest shares by
      Collins & Aikman Products Co.</p>
    </td>
  </tr>
  <tr>
    <td WIDTH="51%" VALIGN="TOP" HEIGHT="48">
      <p>Textron Properties Inc.</td>
    <td WIDTH="49%" VALIGN="TOP" HEIGHT="48">
      <p>C&A Canada Holding Company</td>
  </tr>
  <tr>
    <td WIDTH="51%" VALIGN="TOP" HEIGHT="48">
      <p>Textron Automotive Holdings Italy S.r.l.</p>
    </td>
    <td WIDTH="49%" VALIGN="TOP" HEIGHT="48">
      <p>Collins & Aikman Automotive Systems Italy S.r.l.</p>
    </td>
  </tr>
  <tr>
    <td WIDTH="51%" VALIGN="TOP" HEIGHT="48">
      <p>Textron S.A. de C.V.</p>
    </td>
    <td WIDTH="49%" VALIGN="TOP" HEIGHT="48">
      <p>Collins & Aikman Holdings S.A. de C.V. and/or one or more of its
      wholly owned subsidiaries, and minority interest shares by Collins &
      Aikman International Corporation and/or one or more of its wholly owned
      subsidiaries</p>
    </td>
  </tr>
  <tr>
    <td WIDTH="51%" VALIGN="TOP" HEIGHT="48">
      <p>Textron Automotive B.V.</p>
    </td>
    <td WIDTH="49%" VALIGN="TOP" HEIGHT="48">
      <p>Collins & Aikman Holdings B.V. (Besloten Vennootschap met beperkte
      Aans prakelijkheid)</p>
    </td>
  </tr>
  <tr>
    <td WIDTH="51%" VALIGN="TOP" HEIGHT="48">
      <p>Textron Automotive MIP Limited</p>
    </td>
    <td WIDTH="49%" VALIGN="TOP" HEIGHT="48">
      <p>Collins & Aikman Automotive Interior Systems Europe Ltd.</p>
    </td>
  </tr>
  <tr>
    <td WIDTH="51%" VALIGN="TOP" HEIGHT="48">
      <p>Textron Automotive Interiors Inc.</p>
    </td>
    <td WIDTH="49%" VALIGN="TOP" HEIGHT="48">
      <p>Collins & Aikman Interiors, Inc.</p>
    </td>
  </tr>
  <tr>
    <td WIDTH="51%" VALIGN="TOP" HEIGHT="48">
      <p>Textron Automotive Exteriors Inc.</td>
    <td WIDTH="49%" VALIGN="TOP" HEIGHT="48">
      <p>Collins & Aikman Products Co.</td>
  </tr>
  <tr>
    <td WIDTH="51%" VALIGN="TOP" HEIGHT="24">
      <p>Americus and Evart</td>
    <td WIDTH="49%" VALIGN="TOP" HEIGHT="24">
      <p>JPS Automotive, Inc.</td>
  </tr>
</table>
  </center>
</div>
<b>
<p ALIGN="CENTER">SCHEDULE G</p>
<p ALIGN="CENTER">EARN&#45;OUT TABLE</p>
<p ALIGN="CENTER">($ in millions)</p>
</b>
<p>&nbsp;</p>
<p ALIGN="CENTER"><center>
<table CELLSPACING="0" CELLPADDING="1" WIDTH="336">
  <tr>
    <td WIDTH="57%" VALIGN="TOP">
      <p ALIGN="CENTER">&nbsp;</p>
      <p ALIGN="CENTER">5&#45;Year Cumulative <u>EBITDA</u></td>
    <td WIDTH="43%" VALIGN="TOP">
      <p ALIGN="CENTER">&nbsp;</p>
      <p ALIGN="CENTER">Earn&#45;Out<br>
      <u>Amount</u></td>
  </tr>
  <tr>
    <td WIDTH="57%" VALIGN="TOP">
      <p ALIGN="CENTER">$2,908</td>
    <td WIDTH="43%" VALIGN="TOP">
      <p ALIGN="CENTER">$15.0</td>
  </tr>
  <tr>
    <td WIDTH="57%" VALIGN="TOP">
      <p ALIGN="CENTER">3,297</td>
    <td WIDTH="43%" VALIGN="TOP">
      <p ALIGN="CENTER">65.0</td>
  </tr>
  <tr>
    <td WIDTH="57%" VALIGN="TOP">
      <p ALIGN="CENTER">3,413</td>
    <td WIDTH="43%" VALIGN="TOP">
      <p ALIGN="CENTER">70.0</td>
  </tr>
  <tr>
    <td WIDTH="57%" VALIGN="TOP">
      <p ALIGN="CENTER">3,529</td>
    <td WIDTH="43%" VALIGN="TOP">
      <p ALIGN="CENTER">75.0</td>
  </tr>
  <tr>
    <td WIDTH="57%" VALIGN="TOP">
      <p ALIGN="CENTER">3,645</td>
    <td WIDTH="43%" VALIGN="TOP">
      <p ALIGN="CENTER">80.0</td>
  </tr>
  <tr>
    <td WIDTH="57%" VALIGN="TOP">
      <p ALIGN="CENTER">3,761</td>
    <td WIDTH="43%" VALIGN="TOP">
      <p ALIGN="CENTER">85.0</td>
  </tr>
  <tr>
    <td WIDTH="57%" VALIGN="TOP">
      <p ALIGN="CENTER">3,877</td>
    <td WIDTH="43%" VALIGN="TOP">
      <p ALIGN="CENTER">90.0</td>
  </tr>
  <tr>
    <td WIDTH="57%" VALIGN="TOP">
      <p ALIGN="CENTER">3,993</td>
    <td WIDTH="43%" VALIGN="TOP">
      <p ALIGN="CENTER">95.0</td>
  </tr>
  <tr>
    <td WIDTH="57%" VALIGN="TOP">
      <p ALIGN="CENTER">4,109</td>
    <td WIDTH="43%" VALIGN="TOP">
      <p ALIGN="CENTER">100.0</td>
  </tr>
  <tr>
    <td WIDTH="57%" VALIGN="TOP">
      <p ALIGN="CENTER">4,225</td>
    <td WIDTH="43%" VALIGN="TOP">
      <p ALIGN="CENTER">105.0</td>
  </tr>
  <tr>
    <td WIDTH="57%" VALIGN="TOP">
      <p ALIGN="CENTER">4,341</td>
    <td WIDTH="43%" VALIGN="TOP">
      <p ALIGN="CENTER">110.0</td>
  </tr>
  <tr>
    <td WIDTH="57%" VALIGN="TOP">
      <p ALIGN="CENTER">4,457</td>
    <td WIDTH="43%" VALIGN="TOP">
      <p ALIGN="CENTER">115.0</td>
  </tr>
  <tr>
    <td WIDTH="57%" VALIGN="TOP">
      <p ALIGN="CENTER">4,575</td>
    <td WIDTH="43%" VALIGN="TOP">
      <p ALIGN="CENTER">120.0</td>
  </tr>
  <tr>
    <td WIDTH="57%" VALIGN="TOP">
      <p ALIGN="CENTER">4,691 and greater</td>
    <td WIDTH="43%" VALIGN="TOP">
      <p ALIGN="CENTER">125.0</td>
  </tr>
  <tr>
    <td WIDTH="57%" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="43%" VALIGN="TOP">&nbsp;</td>
  </tr>
</table>
</center><b>
<p ALIGN="CENTER">SCHEDULE H</p>
<p ALIGN="CENTER">&nbsp;</p>
<p ALIGN="CENTER">FIRST QUARTER RESTRUCTURING CHARGES</p>
<p ALIGN="CENTER">&nbsp;</p>
<p ALIGN="CENTER">&nbsp;</p>
<p ALIGN="CENTER">&nbsp;</p>
</b>
<div align="center">
  <center>
<table CELLSPACING="0" CELLPADDING="1" WIDTH="396">
  <tr>
    <td VALIGN="TOP" HEIGHT="17" width="392">
      <p>Philip Monterusso</td>
  </tr>
  <tr>
    <td VALIGN="TOP" HEIGHT="17" width="392">
      <p>Brian Geissler</td>
  </tr>
  <tr>
    <td VALIGN="TOP" HEIGHT="17" width="392">
      <p>Brice Schwalm</td>
  </tr>
  <tr>
    <td VALIGN="TOP" HEIGHT="17" width="392">
      <p>Kennith Smith</td>
  </tr>
  <tr>
    <td VALIGN="TOP" HEIGHT="17" width="392">
      <p>Douglas Tull</td>
  </tr>
  <tr>
    <td VALIGN="TOP" HEIGHT="17" width="392">
      <p>Peter Palamarchuk</td>
  </tr>
  <tr>
    <td VALIGN="TOP" HEIGHT="17" width="392">
      <p>Steve Kling</td>
  </tr>
  <tr>
    <td VALIGN="TOP" HEIGHT="17" width="392">
      <p></p>
    </td>
  </tr>
  <tr>
    <td VALIGN="TOP" HEIGHT="17" width="392">
      <p></p>
    </td>
  </tr>
</table>
  </center>
</div>
<p ALIGN="RIGHT">&nbsp;</p>
<blockquote>
  <blockquote>
    <blockquote>
      <blockquote>
        <blockquote>
          <b>
          <p ALIGN="RIGHT"><a NAME="SendFinalTemp"></a><a NAME="CGRCurrPG"></a>
          EXHIBIT 1</p>
          </b>
          <p ALIGN="CENTER">&nbsp;</p>
          <p ALIGN="CENTER">CERTIFICATE OF DESIGNATION OF THE POWERS,
          PREFERENCES AND RELATIVE, PARTICIPATING, OPTIONAL AND OTHER SPECIAL
          RIGHTS OF THE 15% SERIES A REDEEMABLE PREFERRED STOCK, THE 16% SERIES
          B REDEEMABLE PREFERRED STOCK AND THE 16% SERIES&#160;C REDEEMABLE
          PREFERRED STOCK AND QUALIFICATIONS, LIMITATIONS OR RESTRICTIONS
          THEREOF<sup>a</p>
          </blockquote>
        </blockquote>
      </sup>
      <p ALIGN="CENTER">________________________________________</p>
      <p ALIGN="CENTER">Pursuant to Section&#160;151 of the<br>
      General Corporation Law of the State of Delaware</p>
      <p ALIGN="CENTER">________________________________________</p>
    </blockquote>
  </blockquote>
</blockquote>
<p>Collins & Aikman Products Co. (the &quot;<b>Company</b>&quot;), a
corporation organized and existing under the General Corporation Law of the
State of Delaware, does hereby certify that, pursuant to authority conferred
upon the Board of Directors of the Company by its Certificate of Incorporation
(hereinafter referred to as the &quot;<b>Certificate of Incorporation</b>&quot;)
and pursuant to the provisions of Section&#160;151 of the General
Corporation Law of the State of Delaware, said Board of Directors, by unanimous
written consent dated
[&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;],
2001, duly approved and adopted the following resolution (the &quot;<b>Resolution</b>&quot;):</p>
<p>RESOLVED, that pursuant to the authority vested in the Board of Directors by
the Certificate of Incorporation, the Board of Directors hereby creates,
authorizes and provides for the issuance of six series of Preferred Stock of the
Company, designated as (1)&#160;15% Series&#160;A1 Redeemable Preferred
Stock, without par value, of the Company, (2)&#160;16% Series&#160;B1</p>
<sup>
<p>_______________________</p>
<p>a</sup> If the Credit Facility Lenders shall require the Series A and Series
B Redeemable Preferred Stock to be issued by Parent, two series of Parent
Preferred Stock will be issued in lieu of Series A and Series B Redeemable
Preferred Stock, having substantially similar terms and conditions as are set
forth herein, subject to the modifications described on Schedule 1 hereto.
Series C Redeemable Preferred Stock will be issued by Products in all cases, but
will be exchangeable for the &quot;B&quot; series of Parent Preferred Stock if
Parent Preferred Stock is issued. Appropriate mutually acceptable revisions will
be made to this Certificate of Designation to eliminate the provisions hereof
relating to Series A and Series B Redeemable Preferred Stock, should Parent
Preferred Stock be issued.</p>
<p>Redeemable Preferred Stock, without par value, of the Company,
(3)&#160;16% Series&#160;C1 Redeemable Preferred Stock, without par
value, of the Company, (4)&#160;15% Series&#160;A2 Redeemable Preferred
Stock, without par value, of the Company, (5) 16%&#160;Series&#160;B2
Redeemable Preferred Stock, without par value, of the Company and
(6)&#160;16% Series&#160;C2 Redeemable Preferred Stock, without par
value, of the Company, having the designations, preferences, relative,
participating, optional and other special rights of the shares of each such
series, and the qualifications, limitations and restrictions thereof that are
set forth in the Certificate of Incorporation and in this Resolution, as
follows:</p>
<p>SECTION 1. <u>Designation, Amount and Issuance</u>. (a)&#160;&#160;Of
the six series of Preferred Stock authorized by this Resolution, the
Series&#160;A1 Redeemable Preferred Stock, the Series&#160;B1 Redeemable
Preferred Stock and the Series&#160;C1 Redeemable Preferred Stock are to be
initially issued in connection with the Acquisition and the Series&#160;A2
Redeemable Preferred Stock, the Series&#160;B2 Redeemable Preferred Stock
and the Series&#160;C2 Redeemable Preferred Stock are to be initially issued
as necessary to comply with the registration and exchange provisions of the
Registration Rights Agreement. Additional shares of Redeemable Preferred Stock
may also be issued in accordance with Section&#160;1(b), additional shares
of Series&#160;A1 Redeemable Preferred Stock or Series&#160;A2
Redeemable Preferred Stock may be issued in accordance with
Section&#160;7(d) and additional shares of Series&#160;B1 Redeemable
Preferred Stock or Series&#160;B2 Redeemable Preferred Stock may also be
issued in accordance with Section&#160;5(e). The designations for the six
series of Preferred Stock authorized by this Resolution shall be
(1)&#160;the 15% Series&#160;A1 Redeemable Preferred Stock, without par
value (the <b>&quot;Series&#160;A1 Redeemable Preferred Stock&quot;</b>),
(2)&#160;the 16% Series&#160;B1 Redeemable Preferred Stock, without par
value (the &quot;<b>Series&#160;B1 Redeemable Preferred Stock</b>&quot;),
(3)&#160;the 16% Series&#160;C1 Redeemable Preferred Stock, without par
value (the &quot;<b>Series&#160;C1 Redeemable Preferred Stock</b>&quot;),
(4)&#160;the 15% Series&#160;A2 Redeemable Preferred Stock, without par
value (the &quot;<b>Series&#160;A2 Redeemable Preferred Stock</b>&quot; and,
together with the Series&#160;A1 Redeemable Preferred Stock, the &quot;<b>Series&#160;A
Redeemable Preferred Stock</b>&quot;), (5)&#160;the 16% Series&#160;B2
Redeemable Preferred Stock, without par value (the &quot;<b>Series&#160;B2
Redeemable Preferred Stock</b>&quot; and, together with the Series&#160;B1
Redeemable Preferred Stock, the &quot;<b>Series&#160;B Redeemable Preferred
Stock</b>&quot;), and (6)&#160;the 16% Series&#160;C2 Redeemable
Preferred Stock, without par value (the &quot;<b>Series&#160;C2 Redeemable
Preferred Stock</b>&quot; and, together with the Series&#160;C1 Redeemable
Preferred Stock, the &quot;<b>Series&#160;C Redeemable Preferred Stock</b>&quot;
and such Series&#160;C Redeemable Preferred Stock, together with the
Series&#160;A Redeemable Preferred Stock and the Series&#160;B
Redeemable Preferred Stock, the &quot;<b>Redeemable Preferred Stock</b>&quot;).
The liquidation preference of the Series&#160;A1 Redeemable Preferred Stock,
the Series&#160;B1 Redeemable Preferred Stock and the Series&#160;C1
Redeemable Preferred Stock at their Issuance Date is $1,000 per share and the
original issue price for each such share is $1,000. The issue price per share or
Liquidation Preference of the Redeemable Preferred Stock shall not for any
purpose be considered to be a determination by the Board of Directors with
respect to the capital and surplus of the Company. The liquidation preference of
the Series&#160;A2 Redeemable Preferred Stock, the Series&#160;B2
Redeemable Preferred Stock and the Series&#160;C2 Redeemable Preferred Stock
at their Issuance Date will equal the Liquidation Preference of the
Series&#160;A1 Redeemable Preferred Stock, the Series&#160;B1 Redeemable
Preferred Stock and the Series&#160;C1 Redeemable Preferred Stock,
respectively, at such Issuance Date pursuant to the terms of the Registration
Rights Agreement (which is inclusive of an amount of Series&#160;A Accrued
Dividends, Series&#160;B Accrued Dividends and Series&#160;C Accrued
Dividends, respectively, equal to that of the Series&#160;A1 Redeemable
Preferred Stock, the Series&#160;B1 Redeemable Preferred Stock and the
Series&#160;C1 Redeemable Preferred Stock at such time). The number of
shares constituting the Series&#160;A1 Redeemable Preferred Stock shall be
182,700 shares. The number of shares<a NAME="WrapTest"></a> constituting the
Series&#160;B1 Redeemable Preferred Stock shall be 123,700 shares. The
number of shares constituting the Series&#160;C1 Redeemable Preferred Stock
shall be 20,000 shares. The number of shares constituting the Series&#160;A2
Redeemable Preferred Stock shall be 182,700 shares. The number of shares
constituting the Series&#160;B2 Redeemable Preferred Stock shall be 123,700
shares. The number of shares constituting the Series&#160;C2 Redeemable
Preferred Stock shall be 20,000 shares. In addition, each series of Redeemable
Preferred Stock shall be constituted by up to an additional
[&#160;&#160;&#160;&#160;&#160;&#160;&#160;] shares
of such series to be available for issuance from time to time as provided for in
Sections&#160;1(b) and 7(d) and each series of Series&#160;B Redeemable
Preferred Stock shall be further constituted (a) by up to an additional
[&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;]
shares of such series to be available for issuance as provided in
Section&#160;5(e) and (b) by up to an additional 125,000 shares of such
series to be available for issuance as provided in Section 1(c). None of the
shares of Redeemable Preferred Stock acquired by the Company by reason of
redemption, purchase or otherwise shall be reissued as such, but may be
redesignated for reissuance as shares of a different class or series of
Preferred Stock in compliance with the terms hereof. Except as provided in
Section&#160;1(b), Section&#160;7(d) and Section&#160;5(e), the
Company shall only issue the shares of the Series&#160;A2 Redeemable
Preferred Stock, the Series&#160;B2 Redeemable Preferred Stock and the
Series&#160;C2 Redeemable Preferred Stock to the Holders of the
Series&#160;A1 Redeemable Preferred Stock, the Series&#160;B1 Redeemable
Preferred Stock and the Series&#160;C1 Redeemable Preferred Stock, as
applicable, as is necessary to comply with the registration and exchange
provisions of the Registration Rights Agreement.</p>
<p>(b) In the event that the Company shall be required to pay Liquidated Damages
pursuant to the Registration Rights Agreement and shall elect to pay such
Liquidated Damages in kind, on each Dividend Payment Date the Company shall
issue to each Holder entitled to Liquidated Damages in respect of shares of a
series of Redeemable Preferred Stock held by such Holder such number of newly
issued shares of such series of Redeemable Preferred Stock as is equal to
(x)&#160;the Liquidated Damages then due to such Holder in respect of shares
of Redeemable Preferred Stock of such series held by such Holder, divided by
(y)&#160;the Liquidation Preference plus Total Cash Dividends in Arrears
(inclusive of Additional Dividends and accrued regular dividends from the
preceding Dividend Payment Date if not concurrently paid or accrued in
accordance with the terms hereof) in respect of each share of Redeemable
Preferred Stock of such series as of such Dividend Payment Date. Each newly
issued share of Redeemable Preferred Stock of a series issued to a Holder shall
be identical in all respects, including Liquidation Preference and Total Cash
Dividends in Arrears, to all other shares of Redeemable Preferred Stock of the
same series held by such Holder. In lieu of any issuing any fractional shares of
Redeemable Preferred Stock of any series, the Company may deliver to a Holder an
amount in cash equal to such fraction multiplied by the amount set forth in
clause&#160;(y) of the preceding sentence with respect to such series.</p>
<p>(c) In the event that the Company shall be permitted, in accordance with the
terms of the Purchase Agreement, to satisfy all or a portion of the
Earn&#45;Out Amount, if any, in additional shares of Series B Redeemable
Preferred Stock, the Company may issue such number of additional shares of
Series B Redeemable Preferred Stock having at the time of payment an aggregate
Liquidation Preference plus Total Cash Dividends in Arrears (inclusive of any
Additional Dividends accruing from the most recent Dividend Payment Date) plus
accrued regular dividends equal to the Earn&#45;Out Amount or portion
thereof that the Company is permitted to so satisfy under the terms of the
Purchase Agreement. If any Series&#160;B Redeemable Preferred Stock shall be
outstanding immediately prior to such issuance, all newly issued shares of
Series&#160;B Redeemable Preferred Stock shall be of the same series as all
other outstanding shares of Series&#160;B Redeemable Preferred Stock at such
time and identical to such outstanding shares in all respects, including as to
Liquidation Preference, Total Cash Dividends in Arrears (inclusive of any
Additional Dividends accruing from the most recent Dividend Payment Date),
accrued regular dividends and, if previously obtained with respect to
outstanding Series B Redeemable Preferred Stock, CUSIP number. If no shares of
Series&#160;B Redeemable Preferred Stock shall be outstanding immediately
prior to such issuance, all newly issued shares of Series&#160;B Redeemable
Preferred Stock shall be issued with a Liquidation Preference of $1,000.</p>
<p>Notwithstanding the provisions of the preceding paragraph, if the Company is
not able to issue Series B Redeemable Preferred Stock in satisfaction of the
Earn&#45;Out Amount as contemplated by the preceding paragraph because for
tax purposes such newly issued shares of Series B Redeemable Preferred Stock
would not be fungible with previously outstanding shares of Series B Redeemable
Preferred Stock, then in lieu of issuing shares Series B Redeemable Preferred
Stock in satisfaction of the Earn&#45;Out Amount, the Company may, without
the consent of any Holder, create a new series of Redeemable Preferred Stock, to
be designated &quot;Series D Redeemable Preferred Stock,&quot; identical to the
Series B Redeemable Preferred Stock in all respects, having an initial
Liquidation Preference of $1,000 per share, and, if required pursuant to the
Purchase Agreement, provisions to the effect that (x) the Series D Redeemable
Preferred Stock shall be optionally redeemable by the Company at any time, at a
Redemption Price equal to 100% of the Liquidation Preference thereof plus any
Total Cash Dividends in Arrears (inclusive of Additional Dividends accruing from
the most recent Dividend Payment Date) and accrued regular dividends, (y) the
Series D Redeemable Preferred Stock shall be mandatorily redeemable, at the
Redemption Price set forth in the preceding clause (x), within 30 days following
any date upon which the Company would be permitted to redeem all or a portion of
the Series D Redeemable Preferred Stock without causing a Material Breach by the
Company or Parent, whether in one instance or as permitted from time to time
(the foregoing clause (x) and (y) being the &quot;Redemption Terms&quot;) and
(z) the Series D Redeemable Preferred Stock shall be convertible, at the option
of the Holder, from time to time, in whole or in part, into shares of Series B
Redeemable Preferred Stock having the terms set forth in the second and third
sentences, as applicable, of the immediately preceding paragraph.</p>
<p>SECTION 2. <u>Dividends</u>. (a)&#160;&#160;Subject to
Section&#160;7(d) in the case of Textron Shares only, all shares of
Redeemable Preferred Stock will bear dividends, whether or not earned or
declared, out of funds legally available therefor, from the Issuance Date
thereof accruing on the Liquidation Preference thereof at the rate of
(x)&#160;(I) for all dividend periods ending on or before July 1, 2003, 11%
per annum, and (II) for all dividend periods ending after July 1, 2003, 15% per
annum (the &quot;<b>Series&#160;A Dividend Rate</b>&quot;) in the case of
the Series&#160;A Redeemable Preferred Stock, (y)&#160;(I) for all
dividend periods ending on or before July 1, 2003, 12% per annum, and (II) for
all dividend periods ending after July 1, 2003, 16% per annum (the &quot;<b>Series&#160;B
Dividend Rate</b>&quot;) in the case of the Series&#160;B Redeemable
Preferred Stock and (z)&#160;(I) for all dividend periods ending on or
before July 1, 2003, 12% per annum, and (II) for all dividend periods ending
after July 1, 2003, 16% per annum (the &quot;<b>Series&#160;C Dividend Rate</b>&quot;
and, together with the Series&#160;A Dividend Rate and the Series&#160;B
Dividend Rate, the &quot;<b>Dividend Rate</b>&quot;) in the case of the
Series&#160;C Redeemable Preferred Stock and, in each case, will be payable
quarterly in arrears on each Dividend Payment Date, commencing on
April&#160;1, 2002, to Holders of record on the March&#160;15,
June&#160;15, September&#160;15 and December&#160;15 immediately
preceding the relevant Dividend Payment Date. In calculating the amount of
dividends due on any Dividend Payment Date, the Liquidation Preference utilized
shall be the Liquidation Preference in effect on the first business day
following the immediately preceding Dividend Payment Date. The Company may, at
its option and without notice, elect to accrue (x) at any time, up to (but not
more than) an amount (rounded to the nearest $.01) equivalent to 7% per annum of
the dividends on the Series&#160;A Redeemable Preferred Stock payable on any
Dividend Payment Date and up to (but not more than) an amount (rounded to the
nearest $.01) equivalent to 8% per annum of the dividends on each of the
Series&#160;B Redeemable Preferred Stock and the Series&#160;C
Redeemable Preferred Stock payable on any Dividend Payment Date or (y) at all
times through and including the dividend period ending and Dividend Payment Date
on January 1, 2004 during which the payment of cash dividends on Redeemable
Preferred Stock would result in a Material Breach by the Company or Parent, up
to the full amount of all dividends on each series of Redeemable Preferred Stock
payable on any Dividend Payment Date, but only to the extent necessary to
prevent any such breach from occurring (with any amounts payable in cash being
paid on a pro rata basis (based on aggregate Liquidation Preference) as among
each series of Redeemable Preferred Stock); in each case in lieu of payment of
such dividends in cash and, in each such case, any such accrued dividends
(respectively, the &quot;<b>Series&#160;A Accrued Dividends,&quot;
&quot;Series&#160;B Accrued Dividends</b>&quot; and &quot;<b>Series&#160;C
Accrued Dividends</b>&quot;) will be added to the Liquidation Preference of the
applicable series of Redeemable Preferred Stock. Additional dividends are
payable in cash in respect of Series&#160;A Redeemable Preferred Stock
constituting Textron Shares as provided in Section&#160;7(d) (&quot;<b>Liquidity
Dividends</b>&quot;); provided that at all times through and including the
dividend period ending and Dividend Payment Date on January 1, 2004 during which
the payment of cash Liquidity Dividends on Series A Redeemable Preferred Stock
would result in a Material Breach by the Company or Parent, the Company may,
without notice, elect to accrue up to all Liquidity Dividends payable on Series
A Redeemable Preferred Stock payable on any Dividend Payment Date (but only to
the extent necessary to prevent any such breach from occurring), with any such
accrual being added to the Series A Accrued Dividends for the relevant period.
Dividends shall cease to accumulate in respect of the shares of Redeemable
Preferred Stock upon their redemption unless the Company shall have failed to
pay the relevant redemption price on the Redemption Date.</p>
<p>(b) All dividends (including pursuant to Section&#160;2(f)) paid with
respect to shares of the Redeemable Preferred Stock pursuant to this Certificate
of Designation shall be paid <i>pro</i> <i>rata</i> to the Holders entitled
thereto.</p>
<p>(c) Dividends with respect to Redeemable Preferred Stock are payable when, as
and if declared by the Board of Directors, and nothing contained in this
Certificate of Designation shall in any way or under any circumstances be
construed or deemed to require the Board of Directors to declare, or the Company
to pay or set apart for payment, any dividends on shares of the Redeemable
Preferred Stock at any time. Dividends on the Redeemable Preferred Stock will
accrue whether or not the Company has earnings or profits, whether or not there
are funds legally available for the payment of such dividends and whether or not
dividends are declared. The accrual of dividends as Series&#160;A Accrued
Dividends, Series&#160;B Accrued Dividends or Series&#160;C Accrued
Dividends as permitted by Section&#160;2(a) shall be deemed to be a payment
of dividends and shall fulfill the Company&#39;s obligations with respect to
the payment of such portion of the dividends payable upon the Redeemable
Preferred Stock for all purposes hereof. Other dividends will accumulate to the
extent they are not paid on the Dividend Payment Date for the period to which
they relate as Cash Dividends in Arrears and accumulated and unpaid dividends
which are required to be paid in cash will bear Additional Dividends until paid
on the same basis as set forth in Section&#160;2(a) of this Certificate of
Designation, compounded quarterly on each Dividend Payment Date.</p>
<p>(d) Subject to the Company&#39;s option to accrue a portion of the
dividends provided for in Section&#160;2(a), Holders shall be entitled to
receive the cash dividends provided for in this Certificate of Designation
(including the Total Cash Dividends in Arrears) in preference to and in priority
over any cash dividends (including accumulated and unpaid dividends) payable
upon any Junior Securities.</p>
<p>(e) At the Issuance Date of the Series&#160;A2 Redeemable Preferred Stock
and the Series&#160;B2 Redeemable Preferred Stock and the Series&#160;C2
Redeemable Preferred Stock, such shares shall be issued with Total Cash
Dividends in Arrears and accumulated and unpaid dividends for the then current
dividend period equal to that of the Series&#160;A1 Redeemable Preferred
Stock, the Series&#160;B1 Redeemable Preferred Stock and the
Series&#160;C1 Redeemable Preferred Stock for which it is exchanged pursuant
to the Registration Rights Agreement.</p>
<p>(f) At any time and from time to time when there shall be Total Cash
Dividends in Arrears, the Company may declare and pay, to the Holders of record
of the Redeemable Preferred Stock on any record date chosen by the Company
(which record date shall be not less than 10 and not more than 60 days prior to
the payment date for such special dividend) for such dividends, a special
dividend per share of Redeemable Preferred Stock equal to all or a portion of
the Total Cash Dividends in Arrears as of the payment date. Upon payment of such
a dividend, if less than the Total Cash Dividends in Arrears with respect to a
share has been paid, the Cash Dividends in Arrears and Additional Dividends with
respect to such share shall be reduced on a <i>pro rata</i> basis by the amount
of such dividend.</p>
<p>(g) No full dividends may be declared or paid or funds set apart for the
payment of dividends on, and the Company shall not make any other distribution
with respect to, any Parity Securities for any period unless the entire Total
Cash Dividends in Arrears for all issued and outstanding shares of Redeemable
Preferred Stock shall have been declared and paid in full, except as provided
below. If at any time there shall exist Total Cash Dividends in Arrears, the
Redeemable Preferred Stock will share dividends <i>pro rata </i>with the Parity
Securities (on the basis of the relative unpaid amount of Cash Dividends in
Arrears and Additional Dividends, in the case of the Redeemable Preferred Stock
and of cumulative accrued and unpaid dividends, in the case of such Parity
Securities).</p>
<p>(h) Cash Dividends in Arrears, Additional Dividends and other dividends in
connection with any redemption may be declared and paid at any time, without
reference to any regular Dividend Payment Date, to Holders of record of the
Redeemable Preferred Stock on such date, not more than 60 days prior to the
payment thereof, as may be fixed by the Board of Directors.</p>
<p>(i) Dividends payable on the Redeemable Preferred Stock shall be computed on
the basis of a 360&#45;day year of twelve 30&#45;day months and the
actual number of days elapsed in the period for which dividends are payable and
shall be deemed to accrue on a daily basis.</p>
<p>SECTION 3. <u>Liquidation Preference</u>.&#160;&#160;Upon any
voluntary or involuntary liquidation, dissolution or winding&#45;up of the
Company, Holders will be entitled to be paid, out of the assets of the Company
available for distribution to stockholders, the Liquidation Preference per share
of Redeemable Preferred Stock, plus, without duplication, an amount in cash
equal to all accumulated and unpaid dividends (including any Total Cash
Dividends in Arrears), if any, thereon to the date fixed for liquidation,
dissolution or winding&#45;up (including an amount equal to a prorated
dividend for the period from the last Dividend Payment Date to the date fixed
for liquidation, dissolution or winding&#45;up), plus, in the case of the
Series&#160;C Redeemable Preferred Stock only, an amount in cash equal to
the Common Participation Amount, before any distribution is made on any Junior
Securities, including, without limitation, on any Common Stock of the Company.
If, upon any voluntary or involuntary liquidation, dissolution or
winding&#45;up of the Company, the amounts payable with respect to the
Redeemable Preferred Stock and all other Parity Securities are not paid in full,
the Holders of the Redeemable Preferred Stock and the holders of the Parity
Securities will share equally and ratably in any distribution of assets of the
Company in proportion to their relative liquidation preferences, together with
all accumulated and unpaid dividends to which each is entitled. After payment of
the full amount of the Liquidation Preference and, without duplication,
accumulated and unpaid dividends (including any Total Cash Dividends in Arrears)
to which they are entitled, and, in the case of the Series&#160;C Redeemable
Preferred Stock only, an amount in cash equal to the Common Participation
Amount, Holders will not be entitled to any further participation in any
distribution of assets of the Company. For the avoidance of doubt, the
Series&#160;A Redeemable Preferred Stock, the Series&#160;B Redeemable
Preferred Stock and the Series&#160;C Redeemable Preferred Stock shall
constitute Parity Securities with respect to one another. For the purposes of
this Section&#160;3, neither the sale, conveyance, exchange or transfer (for
cash, shares of stock, securities or other consideration) of all or
substantially all of the property or assets of the Company nor the consolidation
or merger of the Company with one or more entities shall be deemed to be a
liquidation, dissolution or winding&#45;up of the Company. Any payment of
accumulated and unpaid dividends shall be paid prior to any other payments
called for pursuant to this Section 3.</p>
<p>SECTION 4. <u>Voting Rights</u>. (a)&#160;&#160;Holders shall be
entitled to vote on any matter required or permitted to be voted upon generally
by the holders of Common Stock of the Company and such vote shall represent an
aggregate voting power equal to 2% of the voting power of the Company&#39;s
outstanding Common Stock.</p>
<p>(b) In addition, if (i)&#160;after January&#160;1, 2003, there shall
exist any Total Cash Dividends in Arrears remaining in arrears and unpaid for
any two consecutive quarterly dividend periods; (ii)&#160;the Company fails
to discharge its obligation to redeem Redeemable Preferred Stock on any
Redemption Date to the extent required by Section&#160;5; (iii)&#160;the
Company fails to make a Par Offer if such offer is required by the second
paragraph of Section&#160;7(d) hereof or fails to purchase shares of
Series&#160;A Redeemable Preferred Stock from Holders who elect to have such
shares purchased pursuant to such Par Offer; (iv)&#160;a breach or violation
of any other provisions contained in Section&#160;7 hereof occurs and the
breach or violation continues for a period of 45 days or more after the Company
receives notice thereof specifying the default from the Holders of at least 25%
of the shares of Redeemable Preferred Stock then outstanding; (v) Indebtedness
of the Company and/or any Restricted Subsidiary having an individual or
aggregate outstanding principal amount of $25,000,000 or more is declared due
and payable following an event of default prior to its scheduled stated maturity
or is not paid in full upon its scheduled stated maturity; (vi)&#160;a
decree or order is entered by a court having jurisdiction in the premises
granting relief in respect of any Significant Subsidiary in any involuntary case
under the Federal Bankruptcy Code, adjudging such Significant Subsidiary a
bankrupt, or approving as properly filed a petition seeking reorganization,
arrangement, adjustment or composition of or in respect of any Significant
Subsidiary under any Bankruptcy Law, or appointing a receiver, liquidator,
custodian, assignee, trustee, sequestrator (or other similar official) of any
Significant Subsidiary, or of substantially all of its properties, or ordering
the winding&#45;up or liquidation of its affairs under any such law, and any
such decree or order continues unstayed and in effect for a period of 60
consecutive days; or (vii)&#160; any Significant Subsidiary institutes
proceedings to be adjudicated a bankrupt, or any Significant Subsidiary consents
to the institution of bankruptcy proceedings against it, or any Significant
Subsidiary files a petition or answer or consent seeking reorganization or
relief under any Bankruptcy Law, or any Significant Subsidiary consents to the
filing of any such petition or to the appointment of a receiver, liquidator,
custodian, assignee, trustee, sequestrator (or other similar official) of any
Significant Subsidiary, or of substantially all of its properties under any such
law, then, in each such case, the Holders of the majority of the then
outstanding affected series of Redeemable Preferred Stock (voting or consenting,
as the case may be, as one class to the extent such Voting Rights Triggering
Event relates to both series of Redeemable Preferred Stock) will be entitled to
elect two members of the Board of Directors of the Company; <i>provided</i>, <i>however</i>,
that in no event shall such Holders be entitled to elect more than two such
members. Such voting rights will continue until such time as (x)&#160;in the
case of a dividend default described in clause&#160;(i) above, all Total
Cash Dividends in Arrears on the Redeemable Preferred Stock are paid in full,
(y)&#160;in the case of an event described in clause&#160;(v) above, any
such acceleration or event of default has been rescinded, cured or waived or the
Indebtedness relating to such acceleration has been paid, redeemed, repurchased
or defeased in full and (z)&#160;in all other cases, any failure, breach,
default or event giving rise to such voting rights is remedied, cured or waived
by the Holders of at least a majority of the then outstanding affected series of
Redeemable Preferred Stock (voting or consenting, as the case may be, as one
class to the extent such Voting Rights Triggering Event relates to both series
of Redeemable Preferred Stock), after which time the term of the directors
elected pursuant to the provisions of this paragraph shall terminate. Each such
event described in clauses&#160;(i) through (vii) above is referred to
herein as a &quot;<b>Voting Rights Triggering Event</b>.&quot;</p>
<p>(c) The Company shall not modify, change, affect or amend (including in
connection with a merger or consolidation, except to the limited extent
contemplated by Section&#160;7(e)) the Certificate of Incorporation or this
Certificate of Designation to affect materially and adversely the specified
rights, preferences, privileges or voting rights of the Holders of the
Redeemable Preferred Stock, or authorize the issuance of any additional shares
of Redeemable Preferred Stock, without the affirmative vote or consent of
Holders of at least a majority of the shares of Redeemable Preferred Stock then
outstanding, voting or consenting, as the case may be, as one class. In
addition, the Company shall not authorize, create (by way of reclassification,
merger, consolidation or otherwise) or issue (i)&#160;any Parity Securities,
or any obligation or security convertible into or evidencing the right to
purchase any Parity Securities, without the affirmative vote or consent of the
Holders of a majority of the then outstanding shares of Redeemable Preferred
Stock except as expressly contemplated hereby, (ii)&#160;any Senior
Securities, or any obligation or security convertible into or evidencing the
right to purchase Senior Securities, without the affirmative vote or consent of
the Holders of at least a majority of the outstanding shares of the Redeemable
Preferred Stock and (iii)&#160;any Junior Securities constituting
Disqualified Stock, or any obligation or security convertible into or evidencing
the right to purchase Junior Securities constituting Disqualified Stock, without
the affirmative vote or consent of the Holders of at least a majority of the
outstanding shares of the Redeemable Preferred Stock, in each case voting or
consenting, as the case may be, as one class. Except as expressly set forth
above, (i)&#160;the creation, authorization or issuance of any shares of
Junior Securities, Parity Securities or Senior Securities, including the
designation of series thereof within the existing class of Preferred Stock of
the Company, or (ii)&#160;the increase or decrease in the amount of
authorized Capital Stock of any class, including any Preferred Stock of the
Company (other than the Redeemable Preferred Stock), shall not require the
consent of the Holders and shall not be deemed to affect materially and
adversely the specified rights, preferences, privileges or voting rights of
Holders. The affirmative vote or consent of Holders of at least a majority of
the then issued and outstanding shares of Redeemable Preferred Stock shall be
required to increase the amount of authorized Redeemable Preferred Stock. No
vote of the Holders shall be required to decrease the number of authorized
shares of the Redeemable Preferred Stock; <i>provided</i>, <i>however</i>, that
such number shall not be decreased below the number of the then currently issued
and outstanding shares of Redeemable Preferred Stock.</p>
<p>(d) Immediately after voting power to elect directors shall have become
vested and be continuing in the Holders pursuant to Section&#160;4(b) or if
vacancies shall exist in the offices of directors elected by the Holders,
Holders of at least 10% of the then issued and outstanding shares of Redeemable
Preferred Stock or a proper officer of the Company shall call a special meeting
of the Holders for the purpose of electing the directors which such Holders are
entitled to elect. Any such meeting shall be held at the earliest practicable
date, and the Company shall provide Holders with access to the lists of Holders.
At any meeting held for the purpose of electing directors at which the Holders
shall have the right, voting separately as a class, to elect directors, the
presence in person or by proxy of the Holders of at least a majority of the
outstanding shares of Redeemable Preferred Stock shall be required to constitute
a quorum of such Holders.</p>
<p>(e) Any vacancy occurring in the office of a director elected by the Holders
shall be filled by the Holders.</p>
<p>(f) In any case in which the Holders shall be entitled to vote pursuant to
this Section&#160;4 or pursuant to the General Corporation Law of the State
of Delaware, each Holder shall be entitled to one vote for each share of
Redeemable Preferred Stock held.</p>
<p>(g) Holders of at least a majority of the then outstanding shares of
Redeemable Preferred Stock, voting or consenting, as the case may be, separately
as a single class, may waive compliance with any provision of this Certificate
of Designation.</p>
<blockquote>
  <blockquote>
    <p>SECTION 5. Redemption, Series&#160;C Exchange and Parent Exchange.</p>
  </blockquote>
</blockquote>
<p>(a) <u>Optional Redemption</u>. (i)&#160;&#160;The Series A
Redeemable Preferred Stock and the Series B Redeemable Preferred Stock will be
redeemable at the election of the Company, as a whole or from time to time in
part, at any time on or after January 1, 2007, at the applicable redemption
prices (expressed as a percentage of the Liquidation Preference thereof) set
forth below, plus, without duplication, an amount in cash equal to a prorated
dividend for the period from the Dividend Payment Date immediately prior to the
date of redemption (the &quot;Optional Redemption Date&quot;) to the Optional
Redemption Date, if redeemed during the 12&#45;month period beginning on
January&#160;1 of the years indicated below.</p>
<p ALIGN="RIGHT">&nbsp;
<div align="center">
  <center>
<table CELLSPACING="0" CELLPADDING="1" WIDTH="558">
  <tr>
    <td WIDTH="43%" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="57%" VALIGN="TOP" COLSPAN="2">
      <p ALIGN="CENTER">Redemption Price</td>
  </tr>
  <tr>
    <td WIDTH="43%" VALIGN="TOP"><u>
      <p><br>
      Year</u></td>
    <td WIDTH="28%" VALIGN="TOP">
      <p ALIGN="CENTER">Series&#160;A Redeemable Preferred Stock</td>
    <td WIDTH="28%" VALIGN="TOP">
      <p ALIGN="CENTER">Series&#160;B Redeemable Preferred Stock</td>
  </tr>
  <tr>
    <td WIDTH="43%" VALIGN="TOP">
      <p>2007</td>
    <td WIDTH="28%" VALIGN="TOP">
      <p ALIGN="CENTER">107.500%</td>
    <td WIDTH="28%" VALIGN="TOP">
      <p ALIGN="CENTER">108.000%</td>
  </tr>
  <tr>
    <td WIDTH="43%" VALIGN="TOP">
      <p>2008</td>
    <td WIDTH="28%" VALIGN="TOP">
      <p ALIGN="CENTER">105.000%</td>
    <td WIDTH="28%" VALIGN="TOP">
      <p ALIGN="CENTER">105.333%</td>
  </tr>
  <tr>
    <td WIDTH="43%" VALIGN="TOP">
      <p>2009</td>
    <td WIDTH="28%" VALIGN="TOP">
      <p ALIGN="CENTER">102.500%</td>
    <td WIDTH="28%" VALIGN="TOP">
      <p ALIGN="CENTER">102.667%</td>
  </tr>
  <tr>
    <td WIDTH="43%" VALIGN="TOP">
      <p>2010 and thereafter</td>
    <td WIDTH="28%" VALIGN="TOP">
      <p ALIGN="CENTER">100.000%</td>
    <td WIDTH="28%" VALIGN="TOP">
      <p ALIGN="CENTER">100.000%</td>
  </tr>
</table>
  </center>
</div>
<p>&#160;&#160;&#160;&#160;&#160;(ii)&#160;&#160;&#160;&#160;&#160;No
optional redemption may be made unless prior to such redemption any Total Cash
Dividends in Arrears shall have been fully paid on all shares of the Redeemable
Preferred Stock. If less than all the Redeemable Preferred Stock of any series
is to be redeemed, the particular shares of such series to be redeemed will be
determined <i>pro</i> <i>rata</i> among Holders of such series, except that the
Company may redeem such shares held by any Holder of fewer than 100 shares
without regard to such <i>pro</i> <i>rata</i> redemption requirement. If any
Redeemable Preferred Stock is to be redeemed in part, the Redemption Notice that
relates to such Redeemable Preferred Stock shall state the portion of the
Liquidation Preference to be redeemed. New shares of the same series of
Redeemable Preferred Stock having an aggregate Liquidation Preference equal to
the unredeemed portion will be issued in the name of the Holder thereof upon
cancellation of the original shares of Redeemable Preferred Stock.</p>
<p>(b) <u>Mandatory Redemption</u>. (i)&#160;&#160;The Company shall
redeem all outstanding Series&#160;A Redeemable Preferred Stock and
Series&#160;B Redeemable Preferred Stock (subject to the legal availability
of funds therefor) in whole on January&#160;1, 2013; <i>provided</i> that
such date shall be automatically changed upon the issuance of the Acquisition
Notes to be the date that is the first Business Day which is one year following
the final stated maturity date of the Acquisition Notes (without giving effect
to any amendment, modification or waiver thereof), at a redemption price equal
to 100% of the Liquidation Preference thereof, plus, without duplication, all
accumulated and unpaid dividends (including any Total Cash Dividends in
Arrears), if any, to the Maturity Redemption Date. The Company shall redeem all
outstanding Series&#160;C Redeemable Preferred Stock (subject to the legal
availability of funds therefor) in whole on February&#160;1, 2022, at a
redemption price equal to 100% of the Liquidation Preference thereof, plus,
without duplication, all accumulated and unpaid dividends (including any Total
Cash Dividends in Arrears), if any, to the Maturity Redemption Date, plus the
Common Participation Amount.</p>
<p>&#160;&#160;&#160;&#160;&#160;(ii)&#160;&#160;&#160;&#160;&#160;The
Company shall make an offer to redeem (a &quot;<b>Change of Control Offer</b>&quot;)
all outstanding Redeemable Preferred Stock (subject to legal availability of
funds therefor) not later than 60 days following a Change of Control (the &quot;<b>Change
of Control Redemption Date</b>&quot;) at a redemption price equal to 100% of the
Liquidation Preference thereof, plus, without duplication, all accumulated and
unpaid dividends (including any Total Cash Dividends in Arrears), if any, to the
Change of Control Redemption Date, plus, in the case of the Series&#160;C
Redeemable Preferred Stock only, an amount equal to the Common Participation
Amount; <i>provided</i> that (A)&#160;no redemption under this
Section&#160;5(b)(ii) shall be required unless (i)&#160;all Existing
Notes shall have ceased to be outstanding, (ii)&#160;the Company shall have
consummated a defeasance with respect to the Existing Notes in accordance with
the terms thereof or (iii)&#160;the holders of Existing Notes shall have
consented to the Company&#39;s performance of its obligations under this
Section&#160;5(b)(ii) and (B)&#160;no redemption shall be effected until
after the Company has performed all of its obligations arising upon a
&quot;change of control&quot; under any debt instruments of the Company. The
Company shall not consummate a transaction resulting in a Change of Control
unless at the time of or prior to the Change of Control, the Company shall have
entered into customary financial and/or other arrangements which permit the
timely redemption of the Redeemable Preferred Stock under this
Section&#160;5(b)(ii) (disregarding the proviso of the preceding sentence).
The Company may (but shall not be obligated to) discharge any obligation arising
under this Section&#160;5(b)(ii) if a Person other than the Company (whether
or not an Affiliate) makes and consummates a Change of Control Offer in the
manner contemplated, and as required by, this Certificate of Designation.</p>
<p>&#160;&#160;&#160;&#160;&#160;(iii)&#160;&#160;&#160;&#160;&#160;In
the event of any Asset Disposition resulting in Net Cash Proceeds to the Company
or any Restricted Subsidiary required by the terms of the Company&#39;s then
outstanding Indebtedness to be applied towards the repayment of, or any offer to
repay, any outstanding Indebtedness of the Company to the extent that such Net
Cash Proceeds are not applied by the Company within 365 days following such
Asset Disposition toward the repayment of any such Indebtedness or are not
reinvested in the business of the Company and the Restricted Subsidiaries within
365 days following such Asset Disposition, <i>first</i> the Company shall apply
such Net Cash Proceeds towards the making and consummation of any remaining
obligation to offer to purchase or other repayment of any outstanding
Indebtedness of the Company to the extent required by, and in accordance with,
the terms thereof, and towards any fees and expenses associated therewith, and, <i>second</i>,
to the extent that any Net Cash Proceeds remain after any such purchase or
repayment and payment of associated fees and expenses (such remaining proceeds
being &quot;<b>Net Available Proceeds</b>&quot;) and provided no default or
event of default would result under the terms of any Indebtedness of the
Company, the Company shall (a)&#160;declare a special dividend pursuant to
Section&#160;2(e) in an amount equal to the lesser of (x)&#160;the full
amount of the entire Total Cash Dividends in Arrears (together with all other
dividends payable in respect thereof) or (y)&#160;the amount of such Net
Available Proceeds, and (b) after fulfilling any obligations with respect to
special dividends referred to in the preceding clause (a), apply any remaining
Net Available Proceeds (&quot;<b>Remaining Net Available Proceeds</b>&quot;)
towards the making and consummation of an offer (an &quot;<b>Asset Disposition
Offer</b>&quot;) to redeem shares of Redeemable Preferred Stock, at a redemption
price equal to 100% of the Liquidation Preference thereof, plus, without
duplication, all accumulated and unpaid dividends (including any Total Cash
Dividends in Arrears), if any, to the redemption date (the &quot;<b>Asset
Disposition Redemption Date</b>&quot;), which shall be not more than 60 nor less
than 30 days following the Company&#39;s satisfaction of all obligations in
respect of such Asset Disposition and the application of the Net Cash Proceeds
therefrom required hereby to be performed prior to the making of an Asset
Disposition Offer, plus, in the case of the Series C Redeemable Preferred Stock
only, an amount equal to the Common Participation Amount. Notwithstanding
anything herein to the contrary, the amount of Net Available Proceeds may be
recalculated to take account of the <i>pro rata</i> rights of any holders of
Parity Securities, if any.</p>
<p>(c) <u>Dividend Payment</u>. Any payment of accumulated and unpaid dividends
(including any dividends that have been added to the Liquidation Preference)
shall be declared and paid prior to the payment of any redemption price made
pursuant to this Section&#160;5. In addition, the Company shall declare and
pay a special dividend as provided in Section&#160;2(f) in respect of the
full amount of any Total Cash Dividends in Arrears prior to the payment of any
redemption price made pursuant to this Section&#160;5. Notwithstanding
anything herein to the contrary, this Section&#160;5(c) shall not result in
any requirement to make a duplicative payment upon any redemption hereunder.</p>
<p>(d) <u>Procedure for Redemptions</u>. (i)&#160;&#160;Not more than 60
and not less then 30 days prior to any Redemption Date (or, in the case of a
redemption pursuant to Section&#160;5(b)(ii), not more than 60 and not less
than 5 Business Days prior to any Redemption Date), written notice (the &quot;<b>Redemption
Notice</b>&quot;) shall be given by first&#45;class mail, postage prepaid,
to each Holder of record of shares to be redeemed on the record date fixed for
such redemption of the Redeemable Preferred Stock or entitled to the benefits of
a Change of Control Offer or Asset Disposition Offer, as the case may be, at
such Holder&#39;s address as the same appears on the stock register of the
Company; <i>provided</i>, <i>however</i>, that (1)&#160;a Redemption Notice
may be given with respect to a redemption pursuant to Section&#160;5(b)(ii)
on a basis that is conditioned upon and subject to the occurrence of a Change of
Control upon a date that may be subsequently changed (a &quot;<b>Conditional
Redemption Notice</b>&quot;) and (2)&#160;no failure to give such notice nor
any deficiency therein shall affect the validity of the procedure for the
redemption of any shares of Redeemable Preferred Stock to be redeemed except as
to the Holder or Holders to whom the Company has failed to give such notice or
except as to the Holder or Holders whose notice was defective. The Redemption
Notice shall state:</p>
<p>in the case of a Change of Control Offer or Asset Disposition Offer only,
that a Change of Control has occurred or that Remaining Net Available Proceeds
resulting from an Asset Disposition exist, as the case may be, and that such
Holder has the right to require the Company to redeem such Holder&#39;s
Redeemable Preferred Stock at the within mentioned Redemption Price, in the case
of an Asset Disposition Offer, up to a maximum aggregate Redemption Price equal
to the Remaining Net Available Proceeds less the amount of fees and expenses
associated with the making and consummation of the Asset Disposition Offer;</p>
<p>the Redemption Price or, if unascertainable, how the Redemption Price will be
calculated;</p>
<p>in the case of an optional redemption only, whether all or less than all the
outstanding shares of a series of Redeemable Preferred Stock are to be redeemed
and the total number of shares of such Redeemable Preferred Stock being
redeemed;</p>
<p>in the case of an optional redemption only, the number and series of shares
of Redeemable Preferred Stock held by the Holder that the Company intends to
redeem;</p>
<p>in the case of an Asset Disposition Offer only, the aggregate Remaining Net
Available Proceeds available to redeem shares of Redeemable Preferred Stock
pursuant to the Asset Disposition Offer and to pay fees and expenses associated
therewith;</p>
<p>in the case of an Asset Disposition Offer only, that any shares of Redeemable
Preferred Stock tendered in excess of the maximum number able to be repurchased
with the Remaining Net Available Proceeds (net of fees and expenses associated
with the Asset Disposition Offer) will be returned to the Holder and will be
treated for all purposes as if such shares had not been tendered for redemption,
and that in the event of such an excess tender, the Company shall select the
shares of Redeemable Preferred Stock to be redeemed as nearly as practicable on
a <i>pro rata</i> basis;</p>
<p>the Redemption Date or, in the case of a Conditional Redemption Notice, the
first possible and intended Redemption Date;</p>
<p>in the case of an optional redemption or maturity date redemption only, that
the Holder is to surrender to the Company, at the place or places that shall be
designated in such Redemption Notice, its certificates representing the shares
of Redeemable Preferred Stock to be redeemed;</p>
<p>in the case of a Change of Control Offer or Asset Disposition Offer only,
that the Holder is to surrender to the Company, at the place or places that
shall be designated in such Redemption Notice, its certificates representing the
shares of Redeemable Preferred Stock that such Holder has elected to be
redeemed;</p>
<p>that dividends on the shares of any Redeemable Preferred Stock to be redeemed
shall cease to accumulate on the day prior to such Redemption Date unless the
Company defaults in the payment of the redemption price; and</p>
<p>the name of any bank or trust company performing the duties referred to in
subsection (d)(iv) below.</p>
<p>&#160;&#160;&#160;&#160;&#160;(ii)&#160;&#160;&#160;&#160;&#160;On
or before a Redemption Date, each Holder of Redeemable Preferred Stock to be
redeemed shall surrender the certificate or certificates representing such
shares of Redeemable Preferred Stock to the Company, in the manner and at the
place designated in the Redemption Notice, and on the Redemption Date the full
redemption price for such shares shall be payable in cash to the person whose
name appears on such certificate or certificates as the owner thereof, and each
surrendered certificate shall be returned to authorized but unissued shares. In
the event that less than all of the shares represented by any such certificate
are redeemed, a new certificate shall be issued representing the unredeemed
shares.</p>
<p>&#160;&#160;&#160;&#160;&#160;(iii)&#160;&#160;&#160;&#160;&#160;On
and after the Redemption Date, unless the Company defaults in the payment in
full of the applicable redemption price, dividends on the Redeemable Preferred
Stock called or tendered for redemption shall cease to accumulate on the day
prior to the Redemption Date, and the Holders of such shares shall cease to have
any further rights with respect thereto on the Redemption Date, other than the
right to receive the redemption price, without interest.</p>
<p>&#160;&#160;&#160;&#160;&#160;(iv)&#160;&#160;&#160;&#160;&#160;If
a Redemption Notice shall have been duly given or if the Company shall have
given to the bank or trust company hereinafter referred to irrevocable
authorization promptly to give such notice, and if on or before the Redemption
Date specified therein the funds necessary for such redemption shall have been
deposited by the Company with such bank or trust company in trust for the <i>pro</i>
<i>rata</i> benefit of the Holders of the Redeemable Preferred Stock called or
tendered for redemption, then, notwithstanding that any certificate for shares
so called for redemption shall not have been surrendered for cancellation, from
and after the time of such deposit, all shares so called or tendered, or to be
so called or tendered pursuant to such irrevocable authorization, for redemption
shall no longer be deemed to be outstanding and all rights with respect to such
shares shall forthwith cease and terminate, except only the right of the Holders
thereof to receive from such bank or trust company at any time after the time of
such deposit the funds so deposited, without interest. The aforesaid bank or
trust company shall be organized and in good standing under the laws of the
United States of America or of any state within the United States, shall have
capital, surplus and undivided profits aggregating at least $25,000,000 (a
&quot;<b>Qualified Bank</b>&quot;) and shall be identified in the Redemption
Notice. Any interest accrued on such funds from and after the Redemption Date
shall be paid to the Company from time to time. Any funds so set aside or
deposited, as the case may be, and unclaimed at the end of one year from such
Redemption Date shall, to the extent permitted by law, be released or repaid to
the Company, after which release or repayment the Holders of the shares so
called for redemption shall look only to the Company for payment thereof.</p>
<font SIZE="3">
<p>(e) <u>Exchange of Series&#160;C Redeemable Preferred Stock for
Series&#160;B Redeemable Preferred Stock</u>. At any time after the second
anniversary of the Issuance Date of the Series C1 Redeemable Preferred Stock but
prior to the third anniversary of the Issuance Date of the Series C1 Redeemable
Preferred Stock, at the option of the Company or upon the written request of
Holders of a majority of the outstanding shares of Series&#160;C Redeemable
Preferred Stock, the Company shall exchange, in whole and not in part, all
outstanding shares of Series&#160;C Redeemable Preferred Stock for newly
issued shares of Series&#160;B Redeemable Preferred Stock. If any
Series&#160;B Redeemable Preferred Stock shall be outstanding immediately
prior to such exchange, all newly issued shares of Series&#160;B Redeemable
Preferred Stock shall be of the same series as all other outstanding shares of
Series&#160;B Redeemable Preferred Stock at such time and identical to such
outstanding shares in all respects, including as to Liquidation Preference,
Total Cash Dividends in Arrears (inclusive of any Additional Dividends accruing
from the most recent Dividend Payment Date), accrued regular dividends and, if
previously obtained with respect to outstanding Series B Redeemable Preferred
Stock, CUSIP number. If no shares of Series&#160;B Redeemable Preferred
Stock shall be outstanding immediately prior to such exchange, all newly issued
shares of Series&#160;B Redeemable Preferred Stock shall be issued with the
same Liquidation Preference, Total Cash Dividends in Arrears (inclusive of any
Additional Dividends accruing from the most recent Dividend Payment Date) and
accrued regular dividends as the shares of Series&#160;C Redeemable
Preferred Stock immediately prior to such exchange (and the Common Exchange
Factor shall be calculated on such basis). The ratio of exchange shall be one
share of Series&#160;B Redeemable Preferred Stock multiplied by the Common
Exchange Factor for each share of Series&#160;C Redeemable Preferred Stock
exchanged. In lieu of issuing any fractional shares of Series B Redeemable
Preferred Stock, the Company may deliver to a Holder an amount in cash equal to
such fraction multiplied by the sum of the Liquidation Preference plus Total
Cash Dividends in Arrears (inclusive of any Additional Dividends accruing from
the most recent Dividend Payment Date) plus accrued regular dividends in respect
of each share of Series B Redeemable Preferred Stock being issued.</p>
</font>
<p>Not more than 60 and not less than 10 days prior to an exchange provided for
in the preceding paragraph , written notice (the &quot;<b>Exchange Notice</b>&quot;)
shall be given by first&#45;class mail, postage prepaid, to each Holder of
record of shares to be exchanged on the record date fixed for such exchange of
Series&#160;B Redeemable Preferred Stock for Series&#160;C Redeemable
Preferred Stock, at such Holder&#39;s address as the same appears on the
stock register of the Company; <i>provided</i>, <i>however</i>, that no failure
to give such notice nor any deficiency therein shall affect the validity of the
procedure for such exchange. The Exchange Notice shall state (i)&#160;the
date set for exchange, (ii)&#160;the method used to calculate the Common
Exchange Factor, (iii)&#160;that the Holder is to surrender to the Company,
at the place or places that shall be designated in such Exchange Notice, its
certificates representing the shares of Series&#160;C Redeemable Preferred
Stock to be exchanged, (iv)&#160;that following the date set for exchange,
such Holder&#39;s shares of Series&#160;C Redeemable Preferred Stock
shall cease to accrue dividends, whether or not submitted for exchange, and
(v)&#160;that following the date set for exchange, dividends on newly issued
shares of Series&#160;B Redeemable Preferred Stock shall accrue from the
most recent Dividend Payment Date.</p>
<p>SECTION 6. <u>Ranking</u>. The Redeemable Preferred Stock shall, with respect
to dividends and distributions upon liquidation, winding&#45;up and
dissolution of the Company, rank (a)&#160;senior to all classes of Common
Stock of the Company, and to each other class of Capital Stock or series of
Preferred Stock of the Company established after the Issuance Date of the
Series&#160;A1 Redeemable Preferred Stock, Series&#160;B1 Redeemable
Preferred Stock and Series&#160;C1 Redeemable Preferred Stock the terms of
which expressly provide that it ranks junior to the Redeemable Preferred Stock
as to dividends and distributions upon liquidation, winding&#45;up and
dissolution of the Company (collectively referred to, together with all classes
of Common Stock of the Company, as &quot;<b>Junior Securities</b>&quot;),
(b)&#160;subject to any required approval of the Holders in accordance with
Section&#160;4(c) hereof, on a parity with each other class of Capital Stock
or series of Preferred Stock established after the Issuance Date of the
Series&#160;A1 Redeemable Preferred Stock, Series&#160;B1 Redeemable
Preferred Stock and Series&#160;C1 Redeemable Preferred Stock the terms of
which expressly provide that such class or series will rank on a parity with the
Redeemable Preferred Stock as to dividends and distributions upon liquidation,
winding&#45;up and dissolution of the Company (collectively referred to as
&quot;<b>Parity Securities</b>&quot;), and (c)&#160;subject to any required
approval of the Holders in accordance with Section&#160;4(c) hereof, junior
to each class of Capital Stock or series of Preferred Stock established after
the Issuance Date of the Series&#160;A1 Redeemable Preferred Stock,
Series&#160;B1 Redeemable Preferred Stock and Series&#160;C1 Redeemable
Preferred Stock by the Board of Directors and the terms of which do not
expressly provide that such class or series will rank junior to, or on a parity
with, the Redeemable Preferred Stock as to dividends and distributions upon
liquidation, winding&#45;up and dissolution of the Company (collectively
referred to as &quot;<b>Senior Securities</b>&quot;). For the avoidance of
doubt, each series of Redeemable Preferred Stock shall constitute Parity
Securities with respect to one another.</p>
<p>SECTION 7. Certain Additional Provisions.</p>
<p>(a) <u>Limitation on Indebtedness</u>. The Company shall not Incur any
Indebtedness, and the Company shall not permit any of the Restricted
Subsidiaries to Incur any Indebtedness, other than, in any such case, Permitted
Indebtedness; <i>provided</i> that the Company or a Restricted Subsidiary may
Incur Indebtedness if immediately after giving <i>pro forma</i><u> </u>effect
thereto and the use of the proceeds thereof (in accordance with the definition
of &quot;Consolidated Coverage Ratio&quot;), the Consolidated Coverage Ratio is
at least equal to
[&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;]:1.00.
<sup>a</p>
</sup>
<p>For purposes of determining compliance with this Section&#160;7(a),
(i)&#160;in the event that an item of Indebtedness meets the criteria of
more than one of the types of Permitted Indebtedness or the provisions of the
first paragraph of this Section&#160;7(a), the Company in its sole
discretion may classify, and may from time to time reclassify, such item of
Indebtedness and only be required to include the amount of such Indebtedness as
one of such types and such item of Indebtedness may be divided and classified in
more than one of such types, (ii)&#160;the liquidation preference of any
Preferred Stock will be the amount of all obligations of such Person with
respect to the redemption of such Preferred Stock at its stated maturity or upon
liquidation or dissolution (whichever is greater) and (iii)&#160;in no event
shall the accrual of dividends or interest or issuance of
pay&#45;in&#45;kind dividends or interest subsequent to the issuance or
Incurrence of Indebtedness or Preferred Stock giving rise thereto constitute an
Incurrence required to be tested under this Section&#160;7(a).</p>
<font SIZE="3">
<p>(b) <u>Limitations on Restricted Payments</u>. Without limiting other
prohibitions in this Certificate of Designation (including
Sections&#160;4(c) and 5(a)(ii)), the Company shall not, and shall not
permit any Restricted Subsidiary to, directly or indirectly,
(i)&#160;declare or pay any dividend or make any distribution to the holders
of any Junior Securities or Parity Securities (other than dividends or
distributions payable solely in shares of Qualified Capital Stock or in options,
warrants or other rights to purchase shares of Qualified Capital Stock);
(ii)&#160;purchase, redeem or otherwise acquire or retire for value any
Junior Securities or Parity Securities or any options, warrants or other rights
to acquire Junior Securities or Parity Securities (other than</p>
<sup>
<p>________________________</p>
<p>a</sup> To be set with 0.25:1.00 greater capacity than provided for in the
Acquisition Notes or, if the Acquisition Notes are not issued on or before the
first Issuance Date, at a level reasonably acceptable to the Company and
Textron. In no event will the Consolidated Coverage Ratio be greater than
2.0:1.00.</p>
<p>such options, warrants or rights owned by the Company or a Restricted
Subsidiary); or (iii)&#160;make any Investment (other than a Permitted
Investment) in any Person (any of the foregoing actions described in
clause&#160;(i), (ii) or (iii), other than the exclusions therefrom, are
collectively referred to herein as &quot;Restricted Payments&quot;), unless at
the time the Company or such Restricted Subsidiary makes such Restricted
Payment:</p>
<blockquote>
  <blockquote>
  </font>
  <p>no Voting Rights Triggering Event shall have occurred and be continuing (or
  result therefrom);</p>
  <p>after giving effect to such Restricted Payment, the Consolidated Coverage
  Ratio shall be equal to or greater than
  [&#160;&#160;&#160;&#160;&#160;]:1.00; <sup>a</p>
  </sup>
  <p>the aggregate amount of such Restricted Payment and all other Restricted
  Payments declared or made subsequent to the Issuance Date of the
  Series&#160;A1 Redeemable Preferred Stock, Series&#160;B1 Redeemable
  Preferred Stock and Series&#160;C1 Redeemable Preferred Stock would not
  exceed the sum of (without duplication):</p>
  <blockquote>
    <blockquote>
      <p>50% of the Consolidated Net Income accrued during the period (treated
      as one accounting period) from the Issuance Date of the Series&#160;A1
      Redeemable Preferred Stock, Series&#160;B1 Redeemable Preferred Stock
      and Series&#160;C1 Redeemable Preferred Stock to the end of the most
      recent fiscal quarter ending prior to the date of such Restricted Payment
      as to which financial results are available (or, in case such Consolidated
      Net Income shall be a deficit, minus 100% of such deficit); plus</p>
      <p>the aggregate net cash proceeds or fair market value of property
      received by the Company from the issue or sale of Qualified Capital Stock
      of the Company or other capital contributions in respect of Qualified
      Capital Stock of the Company subsequent to the Issuance Date of the
      Series&#160;A1 Redeemable Preferred Stock, Series&#160;B1
      Redeemable Preferred Stock and Series&#160;C1 Redeemable Preferred
      Stock, <i>provided</i> that any such net proceeds received, directly or
      indirectly, by the Company from an employee stock ownership plan financed
      by loans from the Company or a Subsidiary of the Company shall be included
      only to the extent such loans have been repaid with cash on or prior to
      the date of determination; plus</p>
      <sup>
      <p>________________________</p>
      <p>a</sup> To be the same as set forth in the first paragraph of
      Section&#160;7(a).</p>
      <p>the amount by which Indebtedness of the Company or a Restricted
      Subsidiary (other than, in either case, Indebtedness owed to the Company
      or a Restricted Subsidiary) is reduced on the Company&#39;s
      consolidated balance sheet upon the conversion or exchange subsequent to
      the Issuance Date of the Series&#160;A1 Redeemable Preferred Stock,
      Series&#160;B1 Redeemable Preferred Stock and Series&#160;C1
      Redeemable Preferred Stock of any such Indebtedness into or for Qualified
      Capital Stock of the Company (less the amount of any cash, or other
      property, distributed by the Company or such Restricted Subsidiary, as
      applicable, upon such conversion or exchange on account of such
      Indebtedness other than on account of interest or dividends in respect
      thereof); plus</p>
      <p>to the extent not included in Consolidated Net Income, the net
      reduction (received by the Company or any Restricted Subsidiary in cash)
      in Investments (other than Permitted Investments) made by the Company and
      the Restricted Subsidiaries since the Issuance Date of the
      Series&#160;A1 Redeemable Preferred Stock, Series&#160;B1
      Redeemable Preferred Stock and Series&#160;C1 Redeemable Preferred
      Stock (including if such reduction occurs by reason of the return of
      equity capital, the repayment of the principal of loans or advances or the
      redesignation of an Unrestricted Subsidiary as a Restricted Subsidiary),
      not to exceed, in the case of any Investments in any Person, the amount of
      Investments (other than Permitted Investments) made by the Company and its
      Restricted Subsidiaries in such Person since the Issuance Date of the
      Series A1 Redeemable Preferred Stock, Series B1 Redeemable Preferred Stock
      and Series&#160;C1 Redeemable Preferred Stock.</p>
    </blockquote>
  </blockquote>
</blockquote>
</blockquote>
<p>Notwithstanding the foregoing paragraph, so long as no Voting Rights
Triggering Event shall have occurred and be continuing (except as to clauses
(i), (ii), (iii), (vi), (viii), (ix) and (x) below) the foregoing provisions
shall not prohibit the following actions:</p>
<blockquote>
  <blockquote>
    <p>(i)&#160;&#160;&#160;&#160;&#160;retirements,
    redemptions, dividends and other distributions made or paid within 60 days
    after the date of declaration or issuance of notice of redemption or
    retirement if at such date of declaration or issuance of notice of
    redemption or retirement such dividend would have complied with this
    Section&#160;7(b);</p>
    <p>(ii)&#160;&#160;&#160;&#160;&#160;any purchase,
    retirement or redemption of Capital Stock of the Company made
    (x)&#160;by exchange for, or out of the proceeds of any substantially
    concurrent capital contribution in respect of or substantially concurrent
    sale of, Qualified Capital Stock of the Company (other than Capital Stock
    issued or sold to a Subsidiary) or (y)&#160;by exchange for shares of
    Capital Stock of Parent;</p>
    <p>(iii)&#160;&#160;&#160;&#160;&#160;any purchase,
    retirement or redemption of Parity Securities effected together with a
    purchase or redemption of the Redeemable Preferred Stock on a basis that is
    in proportion to their relative liquidation preferences and otherwise in
    compliance with this Certificate of Designation;</p>
    <p>(iv)&#160;&#160;&#160;&#160;&#160;payments (including
    through dividends or distributions to Parent to enable it to make payments)
    (A)&#160;of amounts necessary and when necessary to purchase, redeem,
    acquire, cancel or otherwise retire for value Capital Stock of Parent of the
    Company, in each case held by full time officers, directors or employees of
    Parent, the Company or any of the Company&#39;s Subsidiaries, upon, in
    connection with or following death, disability, retirement, severance or
    termination of employment or service or pursuant to any agreement or plan
    under which such Capital Stock was issued or which was otherwise approved by
    the Board of Directors of the Parent or the Company and creates an
    obligation on the part of the Parent or the Company with respect to its
    Capital Stock of the type contemplated by this subclause&#160;(A),
    (B)&#160;to redeem or repurchase stock purchase or similar rights in
    respect of Capital Stock or (C)&#160;to make cash payments to holders of
    Capital Stock in lieu of the issuance of fractional shares of its Capital
    Stock; provided, however, that the amount of such payments pursuant to
    subclauses&#160;(A), (B) and (C) of this clause&#160;(iv) after the
    Issuance Date of the Series&#160;A1 Redeemable Preferred Stock,
    Series&#160;B1 Redeemable Preferred Stock and Series&#160;C1
    Redeemable Preferred Stock does not exceed
    $[&#160;&#160;&#160;&#160;&#160;&#160;&#160;]
    million in any fiscal year plus any unutilized portion of such amount in any
    prior fiscal year and
    $[&#160;&#160;&#160;&#160;&#160;&#160;&#160;]
    million in the aggregate after such Issuance Date; <sup>a</p>
    </sup>
    <p>(v)&#160;&#160;&#160;&#160;&#160;Restricted Payments
    (other than Investments and other Restricted Payments otherwise permitted
    hereunder) in an aggregate amount not to exceed
    $[&#160;&#160;&#160;&#160;&#160;] million;*</p>
    <p>(vi)&#160;&#160;&#160;&#160;&#160;the payment of
    dividends or distributions to Parent in amounts and at the times necessary
    to permit Parent to pay amounts, if any, owing by Parent in connection with
    the Acquisition, the Credit Facility, the Receivables Facility, the
    Acquisition Notes, the Bridge Financing, the Redeemable Preferred Stock and
    fees and expenses related to any of the foregoing;</p>
  </blockquote>
</blockquote>
<sup>
<p>________________________</p>
<blockquote>
  <blockquote>
    <p>a</sup> To provide 15% additional flexibility in amount as provided for
    in the Acquisition Notes or, if the Acquisition Notes are not issued on or
    prior to the first Issuance Date, in amounts to be reasonably acceptable to
    the Company and Textron.</p>
  <p>&#160;&#160;&#160;&#160;&#160;(vii)&#160;&#160;&#160;&#160;&#160;Investments
  (other than Permitted Investments or Investments otherwise permitted
  hereunder) in an aggregate amount not to exceed
  $[&#160;&#160;&#160;] million.*</p>
  <b>
  <p>&#160;&#160;&#160;&#160;&#160;</b>(viii)&#160;&#160;&#160;&#160;&#160;subject
  to compliance with the other applicable provisions hereof, the payment of
  dividends or distributions in respect of the Redeemable Preferred Stock or
  other Preferred Stock issued pursuant to and in compliance with this
  Certificate of Designation and purchases, retirements or redemptions of any
  shares of Redeemable Preferred Stock in accordance with the terms hereof;</p>
  <p>&#160;&#160;&#160;&#160;&#160;(ix)&#160;&#160;&#160;&#160;&#160;dividends
  or other Restricted Payments (including tax sharing payments) to Parent to the
  extent used by Parent to pay its operating and administrative expenses
  incurred in the ordinary course of its business, including directors&#39;
  fees, legal and audit expenses, listing fees, judgments, awards or settlements
  payable by Parent arising from the businesses of the Company or its
  Subsidiaries or Parent&#39;s status as a public company, public company
  compliance expenses and corporate, franchise and other taxes; or</p>
  <p>&#160;&#160;&#160;&#160;&#160;(x)&#160;&#160;&#160;&#160;&#160;any
  Investment made by the exchange for, or out of the proceeds of a capital
  contribution in respect of or the substantially concurrent sale of, Qualified
  Capital Stock of the Company or by exchange for shares of Capital Stock of
  Parent.</p>
</blockquote>
</blockquote>
<p>Notwithstanding any other provision of this Section 7(b), for so long as any
Textron Shares remain issued and outstanding, the Company shall not, and shall
not permit any Restricted Subsidiary to, directly or indirectly make any
Restricted Payment of the type described in clause (i) or (ii) of the definition
thereof other than (a) Restricted Payments permitted by clauses (ii), (iii),
(iv), (vi), (viii) and (ix) of the preceding paragraph, (b) any dividend or
distribution to Parent to the extent required by Parent to service Indebtedness
owing to any Person that is not an Affiliate of Parent or the Company if such
Restricted Payment would otherwise be permitted by this Section 7(b), and (c)
any dividend or distribution to Parent to the extent required by Parent in
connection with any financing of the Acquisition in lieu of any of the debt
financing contemplated by the Debt Commitment Letter (as defined in the Purchase
Agreement), including the Acquisition Notes and any Refinancing of the Bridge
Financing. The provisions of this paragraph shall operate solely for the benefit
of Textron and its Subsidiaries in their capacity as holders of Textron Shares.
Notwithstanding anything in this Certificate of Designation to the contrary, in
the event of a breach of these provisions and no other provision of this
Certificate of Designation, the sole affected Holders entitled to voting rights
under Section 4 shall be the Holders of the Textron Shares.</p>
<p>The amount of any non&#45;cash Restricted Payment shall be the fair
market value, on the date such Restricted Payment is made, of the assets or
securities proposed to be transferred or issued by the Company pursuant to such
Restricted Payment. For the purposes of calculating the aggregate amount of
Restricted Payments made for the purposes of clause&#160;(2) of the first
paragraph of this Section&#160;7(b), any payment made pursuant to clauses
(i), (ii), (iv), (v) and, (x) of the second preceding paragraph shall be
included and any payment made pursuant to clauses (iii), (vi), (vii), (viii) and
(ix) of the second preceding paragraph shall be excluded.</p>
<p>(c) <u>Limitation on Dividend and Other Payment Restrictions Affecting
Subsidiaries</u>. The Company shall not, and shall not permit any Restricted
Subsidiary to, directly or indirectly, create or otherwise cause or suffer to
become effective any consensual encumbrance or restriction on the ability of any
Restricted Subsidiary (i)&#160;to pay dividends (in cash or otherwise) or
make any other distributions in respect of its Capital Stock owned by the
Company or any other Restricted Subsidiary or pay any Indebtedness or other
obligation owed to the Company or any other Restricted Subsidiary;
(ii)&#160;to make loans or advances to the Company or any other Restricted
Subsidiary; or (iii)&#160;to transfer any of its property or assets to the
Company or any other Restricted Subsidiary. Notwithstanding the foregoing, the
Company may, and may permit any Restricted Subsidiary to, create or otherwise
cause or suffer to become effective any such encumbrance or restriction
(A)&#160;pursuant to any agreement in effect on the Issuance Date of the
Series&#160;A1 Redeemable Preferred Stock, the Series&#160;B1 Redeemable
Preferred Stock and the Series&#160;C1 Redeemable Preferred Stock;
(B)&#160;pursuant to the terms of any Credit Facility, Currency Agreement,
Interest Rate Agreement, Commodity Agreement, Receivables Facility or
Indebtedness Incurred pursuant to
clause&#160;(iii)&#160;or&#160;(iv)&#160;of the definition of
&quot;Permitted Indebtedness&quot;; <i>provided</i> that the Company determines
in good faith that the provisions relating to such encumbrance or restriction at
the time any such agreement is entered into (i)&#160;are customary in
similar agreements entered into by Persons of a comparable size and credit
worthiness to the Company and (ii) could not reasonably be expected to
materially adversely affect the Company&#39;s ability to make required cash
dividend payments with respect to the Redeemable Preferred Stock or to redeem
the Redeemable Preferred Stock on the Maturity Redemption Date;
(C)&#160;pursuant to an agreement existing prior to the date on which such
Person became a Subsidiary of the Company and outstanding on such date and not
created in anticipation of becoming a Subsidiary, which encumbrance or
restriction is not applicable to any other Person or the properties or assets of
any other Person; (D)&#160;pursuant to an agreement effecting a renewal,
refunding or extension of Indebtedness Incurred or Preferred Stock issued
pursuant to an agreement referred to in clause&#160;(A), (B) or (C) above or
this clause (D), <i>provided</i> that the provisions contained in such renewal,
refunding or extension agreement relating to such encumbrance or restriction are
not, in the aggregate, more restrictive in any material respect than the
provisions contained in the agreement the subject thereof, as determined in good
faith by the Company; (E)&#160;in the case of clause&#160;(iii) above,
restrictions contained in any mortgage, security or lease agreement (including a
capital or operating lease) securing Indebtedness of a Subsidiary or relating to
property or assets of a Subsidiary otherwise permitted hereunder, but only to
the extent such restrictions restrict the transfer of the property or asset
subject to such mortgage, security or lease agreement; (F)&#160;in the case
of clause&#160;(iii) above, customary nonassignment provisions entered into
in the ordinary course of business consistent with past practice in leases and
other contracts to the extent such provisions restrict the transfer or
subletting of any such lease or the assignment of rights under such contract;
(G)&#160;any restriction with respect to a Subsidiary of the Company imposed
pursuant to an agreement which has been entered into for the sale or disposition
of Capital Stock or assets of such Subsidiary; (H)&#160;any encumbrance or
restriction with respect to a Foreign Subsidiary pursuant to an agreement
relating to Indebtedness or Liens Incurred by such Foreign Subsidiary which is
permitted hereunder; <i>provided</i>, that the Company determines in good faith
that the provisions relating to such encumbrance or restriction at the time any
such agreement is entered into (i)&#160; are customary in similar agreement
entered into by persons of a comparable size and credit worthiness to the
Company and (ii)&#160;could not reasonably be expected to materially
adversely affect the Company&#39;s ability to make required cash dividend
payments with respect to the Redeemable Preferred Stock or to redeem the
Redeemable Preferred Stock on the Maturity Redemption Date; or (I)&#160;any
encumbrance or restriction which by its terms permits payments to the Company to
the extent needed to pay dividends on any Dividend Payment Date or as otherwise
required hereunder.</p>
<p>(d) <u>Textron Share Liquidity Provisions</u>. The provisions of this Section
7(d) are solely for the benefit of Holders of Series&#160;A Redeemable
Preferred Stock that constitute Textron Shares. In the event that either
(I)&#160;both (A)&#160;the Liquidity Condition is satisfied at any time
and (B)&#160;no Par Offer has been properly made on or before the First
Dividend Payment Date and all Textron Shares purchased pursuant thereto or
(II)&#160;both (A)&#160;the Existing Notes are repaid at or within 180
days of their final Stated Maturity and (B)&#160;no Par Offer has been
properly made on or before such repayment, the Series&#160;A Dividend Rate
applicable solely to Textron Shares will increase by 1.00% per annum for the
first dividend period commencing on the first day after the First Dividend
Payment Date and by an additional 0.50% per annum for each dividend period
thereafter; <i>provided</i> that (1)&#160;the Series&#160;A Dividend
Rate applicable to Textron Shares in effect at any time shall not exceed 20% per
annum and (2)&#160;the Series&#160;A Dividend Rate will return to the
Dividend Rate otherwise applicable under Section&#160;2(a) once a Par Offer
has been properly made and all Textron Shares purchased pursuant thereto. The
period during which the increased Series&#160;A Dividend Rate in respect of
Textron Shares shall be in effect under the immediately preceding sentence is
referred to herein as the &quot;Restricted Period.&quot; During the Restricted
Period, if any, the Company and the Restricted Subsidiaries shall not Incur any
Indebtedness (other than Permitted Restricted Period Debt or Indebtedness
Incurred for the purpose financing a Par Offer) unless the Consolidated Coverage
Ratio (or, if there has been an Asset Acquisition after the Issuance Date of the
Series&#160;A1 Preferred Stock, the Adjusted Consolidated Pro Forma Coverage
Ratio) after giving effect to the Incurrence of such Indebtedness is equal to or
greater than the ratios specified below for the four fiscal quarter periods
ending when specified below:</p>
<p ALIGN="CENTER"><center>
<table CELLSPACING="0" CELLPADDING="1" WIDTH="474">
  <tr>
    <td WIDTH="79%" VALIGN="TOP">
      <p>Periods ending on or prior to December 31, 2002</td>
    <td WIDTH="21%" VALIGN="TOP">
      <p>3.00:1.0</td>
  </tr>
  <tr>
    <td WIDTH="79%" VALIGN="TOP">
      <p>Periods ending on or between January 1, 2003 and December 31, 2003</td>
    <td WIDTH="21%" VALIGN="TOP">
      <p><br>
      3.25:1.0</td>
  </tr>
  <tr>
    <td WIDTH="79%" VALIGN="TOP">
      <p>Periods ending on and after January 1, 2004</td>
    <td WIDTH="21%" VALIGN="TOP">
      <p>3.50:1.0.</td>
  </tr>
</table>
</center>
<p>For so long as there are any issued and outstanding Textron Shares, the
Company will not, and will not permit any Restricted Subsidiary to, refinance,
repay, retire or defease Existing Notes (other than at or within 180 days prior
to their final Stated Maturity) in an aggregate principal amount greater than
$25&#160;million, unless prior to or concurrently therewith a Par Offer
shall have been made. Notwithstanding the Company&#39;s obligations to pay
Liquidity Dividends as provided in this Section 7(d) to the Holders of Textron
Shares, the Company shall not be required to make a Par Offer unless
(i)&#160;all Existing Notes shall have ceased to be outstanding,
(ii)&#160;the Company shall have consummated a defeasance with respect to
the Existing Notes in accordance with the terms thereof or (iii)&#160;the
holders of Existing Notes shall have consented to the making of such Par Offer.</p>
<p>For so long as there are any issued and outstanding Textron Shares, within 60
days after an Asset Acquisition occurring following the Issuance Date of the
Series&#160;A1 Preferred Stock and prior to a Par Offer, the Company shall
deliver a certificate of its Chief Financial Officer to the Holders of Textron
Shares certifying that attached five full fiscal year &quot;stand alone&quot;
projections (the &quot;<b>Certified Projections</b>&quot;) of Consolidated Cash
Flow and Consolidated Interest Expense for the Persons or assets acquired
pursuant to such Asset Acquisition (assuming for the purposes of such
projections that such Persons or assets are the &quot;Company and the Restricted
Subsidiaries&quot; and disregarding clause (viii) of the definition of
Consolidated Interest Expense) are (1)&#160;projections that are utilizing
consistent operating assumptions with any projections delivered to lenders to
the Company in connection with the particular Asset Acquisition (it being agreed
that the Certified Projections are &quot;stand alone&quot; projections and will
accordingly give no effect to any impact of combining or integrating the
acquired Person or assets with the Company and the Restricted Subsidiaries) or
(2)&#160;in the absence of the projections referred to in the preceding
clause (1), the projections utilized by the Board of Directors of the Company
(or any duly authorized Committee thereof) in approving the particular Asset
Acquisition. Such Certified Projections may include a prospective reasonable
methodology for allocating the indicated Consolidated Cash Flow and Consolidated
Interest Expense across quarters for the entire period covered by the Certified
Projections.</p>
<p>The benefit of the provisions of this Section 7(d) are solely intended for
Textron and its Subsidiaries and shall terminate as to any shares of
Series&#160;A Redeemable Preferred Stock that are transferred or otherwise
disposed of to any other Person, regardless of their subsequent reacquisition by
Textron or any of its Subsidiaries.</p>
<p>In the event of any transfer of Textron Shares to a Person other than Textron
or its Subsidiaries (a &quot;<b>Non&#45;Textron Transferee</b>&quot;), if
immediately prior to such transfer there shall exist Total Liquidity Dividends
in Arrears with respect to such Textron Shares, then immediately following such
transfer such Total Liquidity Dividends in Arrears shall cease to exist with
respect to such transferred Textron Shares (the &quot;<b>Transferred Shares</b>&quot;)
and the Transferred Shares shall be for all purposes shares of Series A
Redeemable Preferred Stock not entitled to any of the benefits afforded to
Textron Shares. For the avoidance of doubt, but without limitation, the
Transferred Shares shall have a Liquidation Preference and be entitled to Total
Cash Dividends in Arrears, if any, as if such shares (or any predecessor shares)
had never been Textron Shares. As promptly as practicable following a written
notice of a transfer of Textron Shares to a Non&#45;Textron Transferee, the
Company shall issue to such Non&#45;Textron Transferee additional shares of
Series A Redeemable Preferred Stock identical to the Transferred Shares in all
respects (including, without limitation, as to Liquidation Preference, Total
Cash Dividends in Arrears, if any, and accrued regular dividends), with the
number of such newly issued shares being equal to (x) the Total Liquidity
Dividends in Arrears formerly applicable to the Transferred Shares, divided by
(y) the Liquidation Preference plus Total Cash Dividends in Arrears (inclusive
of Additional Dividends accruing from the most recent Dividend Payment Date)
plus accrued regular dividends from the most recent Dividend Payment Date in
respect of each share of newly issued Series A Redeemable Preferred Stock as of
its date of issuance. In lieu of any issuing any fractional shares of Series A
Redeemable Preferred Stock, the Company may deliver to a Non&#45;Textron
Transferee an amount in cash equal to such fraction multiplied by the amount set
forth in clause (y) of the preceding sentence. The Company may require
reasonable certifications and indemnities from Textron and/or any
Non&#45;Textron Transferee concerning the transfer of Textron Shares as a
condition to issuing additional shares of Series A Redeemable Preferred Stock
(or cash payments in respect of fractional shares) as contemplated by this
paragraph.</p>
<p>(e) <u>Consolidation, Merger and Sale of Assets</u>. The Company shall not,
in a single transaction or through a series of transactions, consolidate with or
merge with or into any other Person or sell, assign, convey, transfer, lease or
otherwise dispose of all or substantially all of its properties and assets to
any other Person or Persons or permit any of the Restricted Subsidiaries to
enter into any such transaction or series of transactions if such transaction or
series of transactions, in the aggregate, would result in the sale, assignment,
conveyance, transfer, lease or other disposition of all or substantially all of
the properties and assets of the Company and the Restricted Subsidiaries on a
consolidated basis to any other Person or Persons, unless at the time and
immediately after giving effect thereto:</p>
<p>&#160;&#160;&#160;&#160;&#160;(i)<b>&#160;&#160;&#160;&#160;&#160;</b>either
(a)&#160;the Company shall be the continuing corporation or (b)&#160;the
Person (if other than the Company) formed by such consolidation or into which
the Company or such Subsidiary is merged or the Person that acquires by sale,
assignment, conveyance, transfer, lease or disposition all or substantially all
the properties and assets of the Company and the Restricted Subsidiaries on a
consolidated basis (the &quot;<b>Surviving Entity</b>&quot;) shall be a
corporation duly organized and validly existing under the laws of the United
States of America, any state thereof or the District of Columbia;</p>
<b>
<p>&#160;&#160;&#160;&#160;&#160;</b>(ii)<b>&#160;&#160;&#160;&#160;&#160;</b>the
Redeemable Preferred Stock shall be converted into or exchanged for and shall
become shares of the Surviving Entity having in respect of the Surviving Entity
the same rights and privileges that the Redeemable Preferred Stock had
immediately prior to such transaction or series of transactions with respect to
the Company;</p>
<b>
<p>&#160;&#160;&#160;&#160;&#160;</b>(iii)<b>&#160;&#160;&#160;&#160;&#160;</b>no
Voting Rights Triggering Event shall have occurred and be continuing; and</p>
<b>
<p>&#160;&#160;&#160;&#160;&#160;</b>(iv)<b>&#160;&#160;&#160;&#160;&#160;</b>after
giving effect to such transaction or series of transactions, the Consolidated
Coverage Ratio shall be equal to or greater than
[&#160;&#160;&#160;&#160;&#160;]:1.00.<sup> a</p>
</sup>
<p>Any Surviving Entity shall file<b> </b>an appropriate certificate of
designation with respect to the preferred stock referred to in
clause&#160;(ii) above with the Secretary of State (or similar public
official) of the jurisdiction under whose laws it is organized. In such event,
the Company shall be released from its obligations under this Certificate of
Designation.</p>
<p><a NAME="_Toc386622247"></a><a NAME="_Toc451526646">(f) <u>Limitation on
Transactions with Affiliates</u>.</a><a NAME="_Toc386622248"></a> The Company
shall not, and shall not permit any of the Restricted Subsidiaries to, directly
or indirectly, enter into or conduct any transaction or series of related
transactions (including the purchase, sale, lease or exchange of any property or
the rendering of any service) involving payments or value to such Affiliate with
or for the benefit of any Affiliate of the Company or any of the Restricted
Subsidiaries (an &quot;Affiliate Transaction&quot;) unless the terms of such
Affiliate Transaction are either (x)&#160;fair to the Company or such
Restricted Subsidiary from a financial point of view or (y)&#160;no less
favorable to the Company or such Restricted Subsidiary, as the case may be, than
those that could be obtained at the time of such transaction in
arm&#39;s&#45;length dealings with a Person who is not such an
Affiliate. For any transaction that involves in excess of $1,000,000, a majority
of the disinterested members of the Board of Directors shall determine that the
transaction satisfies the criteria of the preceding sentence. For any Affiliate
Transaction that involves in excess of $25,000,000, the Company shall obtain an
opinion from a nationally recognized independent investment banking firm or
other firm with experience in evaluating or appraising the terms and conditions
of the type of transaction (or series of related transactions) for which the
opinion is required (an &quot;Independent Evaluation Firm&quot;) stating in
substance that the terms of such Affiliate Transaction are in compliance with
either clause&#160;(x) or (y) above.</p>
<p>________________________</p>
<sup>
<p>a</sup> To be the same as the first paragraph of Section&#160;7(a).</p>
<p>For any Affiliate Transaction (other than as set forth in clauses (i) through
(x) (other than clause&#160;(viii)) below) that involves in excess of
$1,000,000, for so long as Textron and its Subsidiaries are the Holders of at
least a majority of the aggregate Liquidation Preference of any of the
Series&#160;A Redeemable Preferred Stock, the Series&#160;B Redeemable
Preferred Stock or the Series&#160;C Redeemable Preferred Stock, the Company
shall obtain the prior consent of Textron unless the Company shall have obtained
an opinion from an Independent Evaluation Firm stating in substance that the
terms of such Affiliate Transaction are in compliance with either
clause&#160;(x) or (y) above.</p>
<p>The requirements of the immediately preceding paragraph shall not apply to:</p>
<blockquote>
  <blockquote>
    <b>
    <p>&#160;&#160;&#160;&#160;&#160;</b>(i)<b>&#160;&#160;&#160;&#160;&#160;</b>any
    Restricted Payment permitted to be made pursuant to Section&#160;7(b);</p>
    <b>
    <p>&#160;&#160;&#160;&#160;&#160;</b>(ii)<b>&#160;&#160;&#160;&#160;&#160;</b>any
    issuance of securities, or other payments, awards or grants in cash,
    securities or otherwise pursuant to employment arrangements, or any stock
    options and stock ownership plans for the benefit of employees, officers and
    directors, consultants and advisors approved by the Board of Directors of
    the Company, or any loans or advances to employees in the ordinary course of
    business of the Company or any of its Subsidiaries;</p>
    <b>
    <p>&#160;&#160;&#160;&#160;&#160;</b>(iii)<b>&#160;&#160;&#160;&#160;&#160;</b>any
    transaction between or among the Company and any Restricted Subsidiary or
    between or among Restricted Subsidiaries so long as, in the case of any
    Restricted Subsidiary that is not a Wholly Owned Subsidiary, no Affiliate of
    the Company (other than a Restricted Subsidiary) owns any Capital Stock
    (other than directors&#39; qualifying shares) in such Restricted
    Subsidiary;</p>
    <b>
    <p>&#160;&#160;&#160;&#160;&#160;</b>(iv)<b>&#160;&#160;&#160;&#160;&#160;</b>indemnification
    agreements with, and the payment of fees and indemnities to, directors,
    officers and employees of the Company and its Subsidiaries or any
    employment, noncompetition or confidentiality agreements entered into by the
    Company or any of its Subsidiaries with its directors, officers or employees
    in the ordinary course of business;</p>
    <b>
    <p>&#160;&#160;&#160;&#160;&#160;</b>(v)<b>&#160;&#160;&#160;&#160;&#160;</b>the
    issuance of Capital Stock of the Company or the receipt of capital
    contributions by the Company otherwise in compliance with this Certificate
    of Designation;</p>
    <b>
    <p>&#160;&#160;&#160;&#160;&#160;</b>(vi)<b>&#160;&#160;&#160;&#160;&#160;</b>transactions
    pursuant to agreements as in existence on the Issuance Date of the
    Series&#160;A1 Redeemable Preferred Stock, Series&#160;B1 Redeemable
    Preferred Stock and Series&#160;C1 Redeemable Preferred Stock;</p>
    <b>
    <p>&#160;&#160;&#160;&#160;&#160;</b>(vii)<b>&#160;&#160;&#160;&#160;&#160;</b>payments
    contemplated by the Advisory Agreement and payments in connection with the
    Acquisition, including the reimbursement of out&#45;of&#45;pocket
    expenses incurred in connection with the Acquisition;</p>
    <b>
    <p>&#160;&#160;&#160;&#160;&#160;</b>(viii)<b>&#160;&#160;&#160;&#160;&#160;</b>for
    so long as Textron and its Subsidiaries are the Holders of at least a
    majority of the aggregate Liquidation Preference of any of the
    Series&#160;A Redeemable Preferred Stock, the Series&#160;B
    Redeemable Preferred Stock or the Series&#160;C Redeemable Preferred
    Stock, any Affiliate Transaction with respect to which the Company shall
    have obtained the prior consent of Textron;</p>
    <b>
    <p>&#160;&#160;&#160;&#160;&#160;</b>(ix)<b>&#160;&#160;&#160;&#160;&#160;</b>any
    management, service, purchase, supply or similar agreement relating to
    operations of a business entered into in the ordinary course of the
    Company&#39;s business between the Company or any Restricted Subsidiary
    and any Affiliate (including an Unrestricted Subsidiary), so long as any
    such agreement is on terms no less favorable to the Company than those that
    could be obtained in a comparable arm&#39;s&#45;length transaction
    with an entity that is not an Affiliate or a Related Person; and</p>
    <b>
    <p>&#160;&#160;&#160;&#160;&#160;</b>(x)<b>&#160;&#160;&#160;&#160;&#160;</b>any
    reasonable corporate service agreements, tax sharing agreements and other
    agreements customary in connection with spin&#45;off transactions
    entered into between the Company or any Restricted Subsidiary and any
    spun&#45;off entity.</p>
  </blockquote>
</blockquote>
<p>(g) <u>Reports</u>. At all times during which the Parent continues to file
reports on Form 10&#45;K and Form 10&#45;Q with the Securities and
Exchange Commission (the &quot;Commission&quot;) containing the information
required by the Securities Exchange Act of 1934 and the rules and regulations
promulgated thereunder, the Company will provide (i)&#160;to each Holder,
within 10 Business Days following the filing of any such report with the
Commission, a copy (if necessary) of any reconciliation of any material
differences between the consolidated financial statements of the Parent
contained in such report and the consolidated financial results and condition of
the Company and its Subsidiaries during the relevant period or as of the
relevant date, as the case may be, to the extent required to evaluate financial
differences between the legal entities and (ii)&#160;at all times that (A)
the Company is not subject to Section 13 or 15(d) of the Exchange Act and (B)
the requesting Holder is unable to transfer its Redeemable Preferred Stock
pursuant to Rule 144(k) under the Securities Act, within 10 Business Days of any
written request by a Holder, to the requesting Holder or a proposed transferee
of such Holder the information required to be provided by Rule 144A(d)(4) under
the Securities Act. If at any time the Parent shall cease to file such reports
on Form 10&#45;K and Form 10&#45;Q with the Commission, the Company
shall provide to each Holder (i) within 135 days of the end of each fiscal year
of the Company, audited year end financial statements of the Company (including
a balance sheet, income statement and statement of changes in cash flows)
prepared in accordance with GAAP, and (ii) within 60 days after the end of each
of the first three fiscal quarters of each fiscal year of the Company, unaudited
quarterly consolidated financial statements (including a balance sheet, income
statement and statement of changes in cash flows) prepared in accordance with
GAAP.</p>
<p>(h) <u>Limitation on Issuance of Preferred Stock of Restricted Subsidiaries</u>.
The Company will not sell, and will not permit any Restricted Subsidiary to
issue or sell, any Preferred Stock of a Restricted Subsidiary except (i) to the
Company or a Restricted Subsidiary, (ii) the issuance and sale of Preferred
Stock of a Foreign Subsidiary, (iii) upon the request of the lenders party to
the Debt Commitment Letter in accordance with the agreements relating to the
various financings referred to therein, the issuance and sale of Preferred Stock
issued in lieu of any of the debt financing contemplated by the Debt Commitment
Letter, including the Acquisition Notes and any Refinancing of the Bridge
Financing, (iv) the issuance of Preferred Stock by a Restricted Subsidiary which
is a joint venture with a third party which is not an Affiliate of the Company
or a Restricted Subsidiary, and (v) pursuant to obligations with respect to the
issuance or sale of Preferred Stock of a Restricted Subsidiary which exist at
the time it becomes a Restricted Subsidiary of the Company.</p>
<p>SECTION 8. <u>Exchange</u>.</p>
<p>(a) &#160;&#160;&#160;&#160;<u>&#160;Requirements</u>.
The outstanding Series&#160;A1 Redeemable Preferred Stock,
Series&#160;A2 Redeemable Preferred Stock, Series&#160;B1 Redeemable
Preferred Stock, Series&#160;B2 Redeemable Preferred Stock,
Series&#160;C1 Redeemable Preferred Stock and Series&#160;C2 Redeemable
Preferred Stock are exchangeable, as a whole but not in part, solely at the
option of the Company on any Dividend Payment Date for, respectively, the
Company&#39;s Series&#160;A1, 15% Subordinated Notes (the &quot;<b>Series&#160;A1
Exchange Notes</b>&quot;), Series&#160;A2, 15% Subordinated Notes (the
&quot;<b>Series&#160;A2 Exchange Notes</b>&quot;), Series&#160;B1, 16%
Subordinated Notes (the &quot;<b>Series&#160;B1 Exchange Notes</b>&quot;),
Series&#160;B2, 16% Subordinated Notes (the &quot;<b>Series&#160;B2
Exchange Notes</b>&quot;), Series&#160;C1, 16% Subordinated Notes (the
&quot;<b>Series&#160;C1 Exchange Notes</b>&quot;) or Series&#160;C2, 16%
Subordinated Notes (the &quot;Series&#160;C2 Exchange Notes&quot; and,
together with the Series&#160;A1 Exchange Notes, Series&#160;A2 Exchange
Notes, Series&#160;B1 Exchange Notes, Series&#160;B2 Exchange Notes and
Series&#160;C1 Exchange Notes, the &quot;<b>Exchange Notes</b>&quot;), each
to be substantially in the form set forth in the Exchange Indenture, <i>provided</i>
that any such exchange may only be made if on or prior to the date of such
exchange no Total Cash Dividends in Arrears shall exist and the Company
otherwise has paid all accumulated dividends on the Redeemable Preferred Stock
(including the dividends payable on the date of exchange); <i>provided, further</i>,
that for so long as Textron and its Subsidiaries are the Holders of at least a
majority of the aggregate Liquidation Preference of any of the Series&#160;A
Redeemable Preferred Stock, the Series&#160;B Redeemable Preferred Stock or
the Series&#160;C Redeemable Preferred Stock, as the case may be, the
Company shall obtain the written consent of Textron (which consent may be
withheld by Textron in its sole discretion) prior to initiating the procedures
for exchange with respect to such series of Redeemable Preferred Stock. The
exchange rate shall be $1.00 principal amount of Exchange Notes for each $1.00
of the aggregate Liquidation Preference of Redeemable Preferred Stock,
including, to the extent necessary, Exchange Notes in principal amounts less
than $1,000.</p>
<p>(b) At least thirty (30) days and not more than sixty (60) days prior to the
date fixed for exchange, written notice (the &quot;<b>Exchange Notice</b>&quot;)
shall be given by first class mail, postage prepaid, to each Holder of record on
the record date fixed for such exchange of the Redeemable Preferred Stock at
such Holder&#39;s address as the same appears on the share books of the
Company, <i>provided</i> that no failure to give such notice nor any deficiency
therein shall affect the validity of the procedure for the exchange of any
Redeemable Preferred Stock to be exchanged except as to the Holder or Holders to
whom the Company has failed to give said notice or except as to the Holder or
Holders whose notice was defective. The Exchange Notice shall state:</p>
<p>the Exchange Date;</p>
<p>that the Holder is to surrender to the Company, in the manner and at the
place or places designated, his certificate or certificates representing the
Redeemable Preferred Stock to be exchanged;</p>
<p>that dividends on the Redeemable Preferred Stock to be exchanged shall cease
to accrue on such Exchange Date whether or not certificates for Redeemable
Preferred Stock are surrendered for exchange on such Exchange Date unless the
Company shall default in the delivery of Exchange Notes; and</p>
<p>that interest on the Exchange Notes shall accrue from the Exchange Date
whether or not certificates for Redeemable Preferred Stock are surrendered for
exchange on such Exchange Date.</p>
<p>&#160;&#160;&#160;&#160;&#160;(ii)&#160;&#160;&#160;&#160;&#160;On
or before the Exchange Date, each Holder of Redeemable Preferred Stock shall
surrender the certificate or certificates representing such Redeemable Preferred
Stock, in the manner and at the place designated in the Exchange Notice. The
Company shall cause the Exchange Notes to be executed on the Exchange Date and,
upon surrender in accordance with the Exchange Notice of the certificates for
any Redeemable Preferred Stock so exchanged, duly endorsed (or otherwise in
proper form for transfer, as determined by the Company), such shares shall be
exchanged by the Company into Exchange Notes. The Company shall pay interest on
the Exchange Notes at the rate and on the dates specified therein from the
Exchange Date.</p>
<p>&#160;&#160;&#160;&#160;&#160;(iii)&#160;&#160;&#160;&#160;&#160;If
notice has been mailed as aforesaid, and if before the Exchange Date specified
in such notice (1) the Exchange Indenture shall have been duly executed and
delivered by the Company and the trustee thereunder and (2) all Exchange Notes
necessary for such exchange shall have been duly executed by the Company and
delivered to the trustee under the Exchange Indenture with irrevocable
instructions to authenticate the Exchange Notes necessary for such exchange,
then the rights of the Holders of Redeemable Preferred Stock so exchanged as
shareholders of the Company shall cease (except the right to receive Exchange
Notes, an amount equal to the amount of accrued and unpaid dividends to the
Exchange Date), and the Person or Persons entitled to receive the Exchange Notes
issuable upon exchange shall be treated for all purposes as the registered
Holder or Holders of such Exchange Notes as of the Exchange Date.</p>
<p>(c) <u>No Exchange in Certain Cases</u>. Notwithstanding the foregoing
provisions of this Section 8, the Company shall not be entitled to exchange the
Redeemable Preferred Stock for Exchange Notes if such exchange, or any term or
provision of the Exchange Indenture or the Exchange Notes, or the performance of
the Company&#39;s obligations under the Exchange Indenture or the Exchange
Notes, shall materially violate or conflict with any applicable law or if, at
the time of such exchange, the Company is insolvent or if it would be rendered
insolvent by such exchange.</p>
<p>(d) <u>Exchange Indenture</u>. The Exchange Notes shall be issued pursuant to
an indenture (the &quot;<b>Exchange Indenture</b>&quot;) to be entered into
between the Company and a trustee acceptable to it substantially in the form of
Annex A hereto. <sup>a</sup></p>
<font SIZE="2">
<p>________________________</p>
<blockquote>
</font><sup>
<p>a</sup><font SIZE="2"> </font>The Exchange Indenture will be prepared prior
to closing. The Exchange Notes and the Exchange Indenture shall (i) be
subordinated to all obligations (including trade payables) and Indebtedness of
the Company on terms imposed by senior lenders to the Company and its
Subsidiaries (including with respect to payment blockages), (ii) not be
guaranteed by any of the Company&#39;s Subsidiaries or otherwise, (iii)
contain the covenants and provisions set forth in Section&#160;7 (with
respect to the Exchange Notes), and the related definitions of
Section&#160;13 hereof, except that the limitations in Sections 7(a), (b)
and (c) will not restrict the ability of the Company or any of its Subsidiaries
to issue Preferred Stock, (iv) contain events of default that are equivalent to
the Voting Rights Triggering Events listed in clauses (i) through (v) of Section
4(b) of this Resolution and customary remedies provisions for subordinated high
yield debt instruments (and no shareholder or governance voting rights in any
event), (v) provide for quarterly payments of interest in cash and/or
in&#45;kind or by accrual at the rates and on the same basis and dates as
set forth in Section 2, (vi)&#160;mature as provided in
Section&#160;5(b)(i) and be subject to redemption as provided in
Sections&#160;5(a) and 5(b)(ii) (with appropriate provisions to ensure the
prior payment of senior debt) and (vii) contain such other immaterial terms as
are appropriate to a high yield debt indenture. Subject to the foregoing, the
Exchange Notes and the Exchange Indenture shall be mutually acceptable to the
parties.</p>
<p>&nbsp;</p>
</blockquote>
<p>(e) <u>Exchange Taxes</u>. The Company shall be responsible for any transfer
or stamp tax imposed as a result of any exchange made pursuant to this Section
8, regardless of upon whom such tax is imposed (collectively, &quot;<b>Exchange
Taxes</b>&quot;). The Company shall indemnify and hold the Holders harmless
against any Exchange Taxes and shall gross&#45;up Holders and their
Affiliates any additional amount necessary to reflect the tax consequences to
the Holders or their Affiliates (without taking into account any loss credit or
other offset against Tax) of the receipt or accrual of any payments required to
be made under this Section 8(e).</p>
<p>SECTION 9. <u>Conversion or Exchange</u>. The Holders of Redeemable Preferred
Stock shall not have any rights hereunder to convert such shares into or
exchange such shares for shares of any other class or classes or of any other
series of any class or classes of Capital Stock of the Company.</p>
<p>SECTION 10. <u>Reissuance of Senior Preferred Stock</u>. Shares of Redeemable
Preferred Stock reacquired pursuant to the exchange offer contemplated by the
Registration Rights Agreement may be designated and reissued as Preferred Stock
of another series or class; provided that any issuance of such shares of
Preferred Stock must be in compliance with the terms hereof.</p>
<p>SECTION 11. <u>Business Day</u>. If any payment or redemption shall be
required by the terms hereof to be made on a day that is not a Business Day,
such payment or redemption shall be made on the immediately succeeding Business
Day.</p>
<p>SECTION 12. <u>Transfer Restrictions</u>. (a)&#160;&#160;The
Redeemable Preferred Stock will bear a legend to the following effect (as
applicable) unless otherwise agreed by the Company and the Holder thereof:</p>
<blockquote>
  <blockquote>
    <p>THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
    THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD, TRANSFERRED, OR
    OTHERWISE DISPOSED OF IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT
    UNDER SUCH ACT OR PURSUANT TO AN EXEMPTION FROM THE REGISTRATION
    REQUIREMENTS THEREOF.</p>
  </blockquote>
</blockquote>
<p>In addition, each share of Redeemable Preferred Stock shall also bear the
following legend:</p>
<blockquote>
  <blockquote>
    <p>THE COMPANY WILL FURNISH WITHOUT CHARGE TO EACH STOCKHOLDER WHO SO
    REQUESTS THE POWERS, DESIGNATIONS, PREFERENCES AND RELATIVE PARTICIPATING,
    OPTIONAL OR OTHER SPECIAL RIGHTS OF EACH CLASS OF STOCK OF THE COMPANY OR
    SERIES THEREOF AND THE QUALIFICATIONS, LIMITATIONS OR RESTRICTIONS OF SUCH
    PREFERENCES AND/OR RIGHTS.</p>
  </blockquote>
</blockquote>
<p>(b) The transfer agent for the Preferred Stock may refuse to register any
transfer of Redeemable Preferred Stock in violation of the restrictions
contained in the legend provided for in Section&#160;12(a).</p>
<p>(c) The legend provided for in the first paragraph of Section&#160;12(a)
may be removed if the Redeemable Preferred Stock has been registered pursuant to
an effective registration statement under the Securities Act and will be removed
as to Redeemable Preferred Stock held by any Holder after the expiration of the
holding period applicable to sales of the Redeemable Preferred Stock under Rule
144(k) under the Securities Act upon the written representation of such Holder
that such Holder is not an affiliate (as defined in Rule 144 under the
Securities Act) of the Company and has not been an affiliate of the Company at
any time during the three months preceding such request.</p>
<p>SECTION 13. <u>Definitions</u>. As used in this Certificate of Designation,
the following terms shall have the following meanings (with terms defined in the
singular having comparable meanings when used in the plural and vice versa),
unless the context otherwise requires:</p>
<p>&quot;<b>Acquisition</b>&quot; means the acquisition by the Company of the
Bison Subsidiaries (as defined in the Purchase Agreement) pursuant to the
Purchase Agreement and the related transactions.</p>
<p>&quot;<b>Acquisition Notes</b>&quot; means the debt securities issued by the
Company at or prior to the date of the Acquisition to finance, in part, the
Acquisition or any debt securities first issued by the Company after the date of
the Acquisition to refinance in whole or in part any bridge or interim loans
(including any rollover or exchange notes issued in exchange therefor or upon
the maturity thereof) issued or incurred on or prior to the date of the
Acquisition to finance, in part, the Acquisition, as the same may be amended,
modified, waived or refinanced with new debt securities.</p>
<p>&quot;<b>Additional Dividends</b>&quot; means, with respect to a series of
Redeemable Preferred Stock, the Series&#160;A Additional Dividends, the
Series&#160;B Additional Dividends or the Series&#160;C Additional
Dividends, as applicable.</p>
<p>&quot;<b>Adjusted Consolidated Pro Forma Coverage Ratio</b>&quot; means, as
of any date of determination, the ratio of (i) the aggregate amount of
Consolidated Cash Flow for the period of the four most recent fiscal quarters of
the Company, <u>minus</u> Projected Time Adjusted Acquisition Cash Flow to (ii)
Consolidated Interest Expense for such four fiscal quarter period, <u>minus</u>
Projected Time Adjusted Acquisition Interest Expense.</p>
<p>&quot;<b>Advisory Agreement</b>&quot; means the Services Agreement dated as
of February&#160;23, 2001, as amended on the date of the Purchase Agreement,
among the Parent, the Company and Heartland Industrial Partners, L.P. (or any
other Affiliate thereof), as the same may be amended or modified from time to
time; but without giving effect to any amendment or modification after the
Issuance Date of the Series A1 Redeemable Preferred Stock, the Series B1
Redeemable Preferred Stock and the Series&#160;C1 Redeemable Preferred Stock
that would increase the net fees payable thereunder to Heartland Industrial
Partners, L.P. and its Affiliates that have not been made subject to compliance
with the provisions of Section 7(f).</p>
<p>&quot;<b>Affiliate</b>&quot; of any specified Person means any other Person,
directly or indirectly, controlling or controlled by or under direct or indirect
common control with such specified Person. For the purposes of this definition,
&quot;control&quot; when used with respect to any Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise and
the terms &quot;controlling&quot; and &quot;controlled&quot; have meanings
correlative to the foregoing.</p>
<p>&quot;<b>Asset Acquisition</b>&quot; means (i)&#160;an Investment by the
Company or any Restricted Subsidiary in any other Person pursuant to which such
Person will become a Restricted Subsidiary or will be merged or consolidated
with or into the Company or any Restricted Subsidiary or (ii)&#160;the
acquisition by the Company or any Restricted Subsidiary of the assets of any
Person which constitute substantially all of the assets of such Person or any
division or line of business of such Person.</p>
<p>&quot;<b>Asset Disposition</b>&quot; means any sale, lease, transfer,
issuance or other disposition (or series of related sales, leases, transfers,
issuances or dispositions that are part of a common plan) of shares of Capital
Stock of (or other equity interests in) a Restricted Subsidiary (other than
directors&#39; qualifying shares), or of any other property or other assets
(each referred to for the purposes of this definition as a
&quot;disposition&quot;) by the Company or any of its Restricted Subsidiaries
(including any disposition by means of a merger, consolidation or similar
transaction) other than (i)&#160;a disposition by a Restricted Subsidiary to
the Company or by the Company or a Restricted Subsidiary to a Restricted
Subsidiary, (ii)&#160;any disposition in the ordinary course of business,
and (iii)&#160;any disposition of obsolete or worn out equipment or
equipment that is no longer used or useful in the conduct of the business of the
Company and its Restricted Subsidiaries and that is disposed of in each case in
the ordinary course of business. Notwithstanding anything to the contrary
contained above, a Restricted Payment or other payment made in compliance with
Section&#160;7(b) shall not constitute an Asset Disposition.</p>
<p>&quot;<b>Asset Disposition Offer</b>&quot; has the meaning specified in
Section 5(b)(iii) hereof.</p>
<p>&quot;<b>Asset Disposition Offer Redemption Date</b>&quot; has the meaning
specified in Section 5(b)(iii) hereof.</p>
<p>&quot;<b>Bridge Financing</b>&quot; means collectively the &quot;Senior
Unsecured Facility&quot; as defined in the Debt Commitment Letter.</p>
<p>&quot;<b>Business Day</b>&quot; means each Monday, Tuesday, Wednesday,
Thursday and Friday which is not a day on which banking institutions in New York
City or place of payment are authorized or obligated by law, regulation or
executive order to close.</p>
<p>&quot;<b>Capital Stock</b>&quot; of any Person means any and all shares,
interests, rights to purchase, warrants, options, participations or other
equivalents of or interests in (however designated) equity of such Person,
including any Preferred Stock, but excluding any debt securities convertible
into such equity.</p>
<p>&quot;<b>Capitalized Lease Obligations</b>&quot; means an obligation to pay
rent or other payment amounts under a lease that is required to be classified
and accounted for as a capitalized lease or a liability for financial reporting
purposes in accordance with GAAP, and the amount of Indebtedness represented by
such obligation shall be the capitalized amount of such obligation determined in
accordance with GAAP.</p>
<p>&quot;<b>Cash Dividends in Arrears</b>&quot; means, with respect to a share
of Redeemable Preferred Stock at any date of determination, the
Series&#160;A Cash Dividends in Arrears, the Series&#160;B Cash
Dividends in Arrears or the Series&#160;C Cash Dividends in Arrears, as
applicable, at such date of determination.</p>
<p>&quot;<b>Certified Projections</b>&quot; has the meaning specified in Section
7(d) hereof.</p>
<p>&quot;<b>Change of Control</b>&quot; means the occurrence of any of the
following events: (A)&#160;any &quot;person&quot; or &quot;group&quot; (as
such terms are used in Sections&#160;13(d) and 14(d) of the Exchange Act),
excluding Sponsor and, in the case of the Company, Parent, shall become the
&quot;beneficial owner&quot; (as defined in Rules 13d&#45;3 and
13d&#45;5 under the Exchange Act), directly or indirectly, of more than 50%
of the total voting power of the then outstanding Voting Stock of the Company or
of Parent; <i>provided, however</i>, that (1)&#160;any such Person or group
shall be deemed to beneficially own any Voting Stock beneficially owned by any
other Person (the &quot;<b>parent entity</b>&quot;) so long as such Person or
group beneficially owns, directly or indirectly, a majority of the then
outstanding Voting Stock of the parent entity and no other Person or group has
the right to designate or appoint a majority of the directors (or similar
governing body) of such parent entity, and (2)&#160;the effect of any
stockholders agreements with respect to voting for directors that exist on the
date of, and after giving effect to, the Acquisition will be disregarded, or
(B)&#160;any other event constituting a &quot;change of control&quot; under
any Acquisition Notes that constitutes either an event of default or a
circumstance that permits holders of Acquisition Notes to require that the
Company repurchase their Acquisition Notes.</p>
<p>&quot;<b>Change of Control Redemption Date</b>&quot; has the meaning
specified in Section&#160;5(b)(ii) hereof.</p>
<p>&quot;<b>Code</b>&quot; means the Internal Revenue Code of 1986, as amended.</p>
<p>&quot;<b>Commission</b>&quot; means the Securities and Exchange Commission,
as from time to time constituted, created under the Exchange Act.</p>
<p>&quot;<b>Commodity Agreement</b>&quot; means any commodity future contract,
commodity option or other similar agreement or arrangement entered into by the
Company or any Restricted Subsidiary that is designed to protect the Company or
any Restricted Subsidiary against fluctuations in the price of commodities used
by the Company or a Restricted Subsidiary as raw materials in the ordinary
course of business.</p>
<p>&quot;<b>Common Fair Market Value</b>&quot; means the fair market value per
share of Common Stock of the Company, as determined from time to time by the
board of directors of the Company acting in good faith, which determination
shall be conclusive.</p>
<p>&quot;<b>Common Equivalent Shares</b>&quot; means, with respect to each share
of Series C Redeemable Preferred Stock, (x) as of the initial Issuance Date of
the Series C1 Redeemable Preferred Stock,
[&#160;&#160;&#160;&#160;] <sup>a</sup>shares of Common Stock of
the Company and (y) as of any other date,</p>
<p>________________________</p>
<blockquote>
  <sup>
  <p>a</sup> As of the Issuance Date of the Series C1 Redeemable Preferred
  Stock, and only as of such date, this number will equal a fraction, (i) the
  numerator of which is (x) $1,000 (the initial Liquidation Preference of the
  Series C1 Redeemable Preferred Stock), multiplied by (y) the number of
  outstanding shares of Common Stock of Collins & Aikman Products Co. on
  such date, and (ii) the denominator of which is (x) the number of outstanding
  shares of Common Stock of Collins & Aikman Corporation on such date (after
  giving effect to the transactions contemplated by the Purchase Agreement),
  multiplied by (y) $5 per share. After the Issuance Date of the Series C1
  Redeemable Preferred Stock, this number will be adjusted from time to time as
  set forth in the definition.</p>
</blockquote>
<p>&#03;such number of shares of Common Stock of the Company, as increased or
decreased from time to time by the board of directors of the Company acting in
good faith, which determination shall be conclusive, to reflect (A) dividends
and distributions in respect of Common Stock of the Company paid in Common Stock
of the Company, (B) subdivisions, combinations and reclassifications of Common
Stock of the Company, (C) the issuance to all holders of Common Stock of the
Company of rights, options or warrants entitling such holders to purchase from
the Company its Common Stock at a price below the Common Fair Market Value at
the record date with respect to the issuance of such rights, options or
warrants, and (D) capital contributions to the Company either (i) not
accompanied by any issuance of Common Stock of the Company to the Person making
any such capital contribution, or (ii) accompanied by the issuance of Common
Stock of the Company (or securites convertible into or exchangeable therefor) to
the person making any such capital contribution at an implied price per share of
Common Stock of the Company that is less than the Common Fair Market Value as of
the date of such capital contribution.</p>
<p>&quot;<b>Common Exchange Factor</b>&quot; means as of any date of
determination (x) the Liquidation Preference per share of the Series C
Redeemable Preferred Stock as of such date, plus the Total Cash Dividends in
Arrears (inclusive of any Additional Dividends accruing from the most recent
Dividend Payment Date) with respect to a share of Series C Redeemable Preferred
Stock as of such date, plus accrued regular dividends per share of Series C
Redeemable Preferred Stock as of such date, plus the Common Participation
Amount, divided by (y) the Liquidation Preference per share of the Series B
Redeemable Preferred Stock as of such date, plus the Total Cash Dividends in
Arrears (inclusive of any Additional Dividends accruing from the most recent
Dividend Payment Date) with respect to a share of Series B Redeemable Preferred
Stock as of such date, plus accrued regular dividends per share of Series B
Redeemable Preferred Stock as of such date.</p>
<p>&quot;<b>Common Participation Amount</b>&quot; means fifteen percent of the
difference between (x) the product of the number of Common Equivalent Shares
multiplied by the Common Fair Market Value, in each case as of the time of any
event requiring the calculation of the Common Participation Amount, minus (y)
the product of the number of Common Equivalent Shares multiplied by the Common
Fair Market Value, in each case as of the Issuance Date of the Series C1
Redeemable Preferred Stock; <i>provided</i> that (i) the Common Participation
Amount shall not exceed an amount per share of Series C Redeemable Preferred
Stock equal to (p) $2,000,000 divided by (q) the total number of outstanding
shares of Series C Redeemable Preferred Stock as of the time of any event
requiring the calculation of the Common Participation Amount and (ii) the Common
Participation Amount cannot be less than zero.</p>
<p>&quot;<b>Common Stock</b>&quot; of any Person means any and all shares,
interests or other participations in, and other equivalents (however designated,
whether voting or non&#45;voting) of such Person&#39;s common stock,
whether outstanding on the Issuance Date or issued after the Issuance Date, and
includes, without limitation, all series and classes of such common stock.</p>
<p>&quot;<b>Company</b>&quot; means the Person named as the &quot;Company&quot;
in the first paragraph of this Certificate of Designation until a successor or
other Person shall have become such pursuant to the applicable provisions of
this Certificate of Designation, and thereafter &quot;Company&quot; shall mean
such successor Person.</p>
<p>&quot;<b>Consolidated Cash Flow</b>&quot; for any period means the
Consolidated Net Income for such period, plus the following to the extent
deducted in calculating such Consolidated Net Income: (i)&#160;consolidated
income tax expense; (ii)&#160;Consolidated Interest Expense;
(iii)&#160;depreciation expense; (iv)&#160;amortization expense;
(v)&#160;all other noncash items reducing Consolidated Net Income;
(vi)&#160;all management and other fees directly or indirectly paid during
such period to Sponsor to the extent permitted hereunder; (vii)
non&#45;recurring and customary fees and expenses related to any issue of
Capital Stock, Incurrence of Indebtedness or other financing transaction; and
(viii) lease payments, or the functional equivalent thereof (including payments
of principal and interest in connection with any synthetic lease arrangement or
similar financing arrangement), relating to the real property and equipment
initially subject to the transaction described in Section 5.21 of the Purchase
Agreement. Notwithstanding the foregoing, the consolidated income tax expense,
depreciation expense and amortization expense of a Subsidiary of the Company
shall be included in Consolidated Cash Flow only to the extent (and in the same
proportion) that the net income of such Subsidiary was included in calculating
Consolidated Net Income.</p>
<p>&quot;<b>Consolidated Coverage Ratio</b>&quot; as of any date of
determination means the ratio of (i)&#160;the aggregate amount of
Consolidated Cash Flow for the period of the most recent four consecutive fiscal
quarters ending prior to the date of such determination and as to which
financial statements are available to (ii)&#160;the sum of (x) Consolidated
Interest Expense, plus (y) the implied interest component of any payments of the
type described in clause (viii) of the definition of Consolidated Cash Flow, in
each case for such four fiscal quarters; <i>provided</i> that (1)&#160;if
the Company or any of the Restricted Subsidiaries has Incurred any Indebtedness
since the beginning of such period through the date of determination of the
Consolidated Coverage Ratio that remains outstanding or if the transaction
giving rise to the need to calculate Consolidated Coverage Ratio is an
incurrence of Indebtedness, Consolidated Cash Flow and Consolidated Interest
Expense for such period shall be calculated after giving effect on a <i>pro
forma</i><u> </u>basis to (A)&#160;such Indebtedness (<i>provided</i> that,
if such Indebtedness is Incurred under a revolving credit facility (or similar
arrangement or under any predecessor revolving credit or similar arrangement),
only that portion of such Indebtedness that constitutes the one year projected
average balance of such Indebtedness (as determined in good faith by senior
management of the Company) shall be deemed outstanding for purposes of this
calculation) and (B)&#160;the discharge of any other Indebtedness repaid,
repurchased, defeased or otherwise discharged with the proceeds of such new
Indebtedness as if such discharge had occurred on the first day of such period,
(2)&#160;if since the beginning of such period any Indebtedness of the
Company or any of the Restricted Subsidiaries has been repaid, repurchased,
defeased or otherwise discharged (other than Indebtedness under a revolving
credit or similar arrangement unless such revolving credit Indebtedness has been
permanently repaid and has not been replaced), Consolidated Interest Expense for
such period shall be calculated after giving <i>pro forma</i><u> </u>effect
thereto as if such Indebtedness had been repaid, repurchased, defeased or
otherwise discharged on the first day of such period, (3)&#160;if since the
beginning of such period the Company or any of the Restricted Subsidiaries shall
have made any Asset Disposition or if the transaction giving rise to the need to
calculate the Consolidated Coverage Ratio involves an Asset Disposition,
Consolidated Cash Flow for such period shall be reduced by an amount equal to
the Consolidated Cash Flow (if positive) attributable to the assets which are
the subject of such Asset Disposition for such period or increased by an amount
equal to the Consolidated Cash Flow (if negative) attributable thereto for such
period, and Consolidated Interest Expense for such period shall be reduced by an
amount equal to the Consolidated Interest Expense attributable to any
Indebtedness of the Company or any of the Restricted Subsidiaries repaid,
repurchased, defeased or otherwise discharged with respect to the Company and
its continuing Restricted Subsidiaries in connection with such Asset Disposition
for such period (or, if the Capital Stock of any Restricted Subsidiary of the
Company is sold, transferred or otherwise disposed of, the Consolidated Interest
Expense for such period directly attributable to the Indebtedness of such
Restricted Subsidiary to the extent the Company and the continuing Restricted
Subsidiaries are no longer liable for such Indebtedness after such sale,
transfer or other disposition), (4)&#160;if since the beginning of such
period the Company or any of the Restricted Subsidiaries (by merger or
otherwise) shall have made an Asset Acquisition, Consolidated Cash Flow and
Consolidated Interest Expense for such period shall be calculated after giving <i>pro
forma</i><u> </u>effect thereto (including the incurrence of any Indebtedness)
as if such Asset Acquisition occurred on the first day of such period and
(5)&#160;if since the beginning of such period any Person that subsequently
became a Restricted Subsidiary or was merged with or into the Company or any
Restricted Subsidiary since the beginning of such period shall have made any
Asset Disposition or Asset Acquisition that would have required an adjustment
pursuant to clause&#160;(3) or (4) above if made by the Company or a
Restricted Subsidiary during such period, Consolidated Cash Flow and
Consolidated Interest Expense for such period shall be calculated after giving <i>pro
forma</i><u> </u>effect thereto as if such Asset Disposition or Asset
Acquisition occurred on the first day of such period. For purposes of this
definition, whenever <i>pro forma</i><u> </u>effect is to be given to an Asset
Acquisition, the amount of income or earnings relating thereto and the amount of
Consolidated Interest Expense associated with any Indebtedness Incurred in
connection therewith, the <i>pro forma</i><u> </u>calculations shall be
determined in good faith by the Company. If any Indebtedness or Preferred Stock
bears a floating rate of interest or dividends and is being given <i>pro forma</i><u>
</u>effect, the interest expense on such Indebtedness shall be calculated as if
the rate in effect on the date of determination had been the applicable rate for
the entire period (taking into account any Interest Rate Agreement applicable to
any such Indebtedness if such Interest Rate Agreement has a remaining term that
extends at least until the end of such period). <sup>a</p>
</sup>
<p>&quot;<b>Consolidated Interest Expense</b>&quot; means, for any period, the
total interest expense of the Company and the Restricted Subsidiaries for such
period as determined on a consolidated basis in accordance with GAAP, plus, to
the extent not included in such interest expense, (i)&#160;interest expense
attributable to capital leases, (ii)&#160;amortization of debt discount,
(iii)&#160;capitalized interest, (iv)&#160;noncash interest expense,
(v)&#160;commissions, discounts and other fees and charges owed with respect
to letters of credit and bankers acceptance financing, (vi)&#160;interest
actually paid by the Company or any such Restricted Subsidiary under any
guarantee of Indebtedness or other obligation of any other Person, and
(vii)&#160;net payments (whether positive or negative) pursuant to Interest
Rate Agreements and, to the extent related to Indebtedness, Currency Agreements.
Notwithstanding the foregoing, consolidated interest expense and the other items
referred to in the preceding clauses of a Subsidiary of the Company shall be
included only to the extent (and in the same proportion) that the net income of
such Subsidiary was included in calculating Consolidated Interest Expense.</p>
<p>&quot;<b>Consolidated Net Income</b>&quot; means, for any period, the net
income (loss) of the Company and the consolidated Restricted Subsidiaries for
such period determined in accordance with GAAP; <i>provided</i>, <i>however</i>,
that there shall not be included in such Consolidated Net Income:
(i)&#160;any gain or loss realized upon the sale or other disposition of any
assets of the Company or the Restricted Subsidiaries (including pursuant to any
sale/leaseback transaction) which are not sold or otherwise disposed of in the
ordinary course of business and any gain or loss realized upon the sale or other
disposition of any Capital Stock of any Person; (ii)&#160;any extraordinary
or nonrecurring gain or loss; (iii)&#160;the cumulative effect of a change
in accounting principles; (iv)&#160;any noncash expenses attributable to
grants or exercises of em&#45;</p>
<p>________________________</p>
<sup>
<p>a</sup> Solely for purposes of Sections 7(a), (b) and (e), this definition
and the definitions of Consolidated Net Income, Consolidated Cash Flow and
Consolidated Interest Expense will be conformed to the similar interest coverage
calculations and definitions in the Acquisition Notes if the Acquisition Notes
are issued on or prior to the first Issuance Date.</p>
<p>ployee stock options or other employee benefit arrangements; (v) the net
income or loss of any Person acquired in a pooling of interests transaction for
any period prior to the date of such acquisition; and (vi) any net income or
loss of any Restricted Subsidiary to the extent such Restricted Subsidiary is
subject to restrictions on the payment of dividends or the making of
distributions by such Restricted Subsidiary, directly or indirectly, to the
Company.</p>
<p>&quot;<b>Credit Facilities</b>&quot; <sup>a</sup> means (i)&#160;the
credit agreement dated as of
[&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;],
2001, among
[&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;],
[&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;],
as administrative agent and each of the lenders that is a signatory thereto,
together with the related documents thereto (including, without limitation, any
guarantee agreements and security documents), in each case as such agreements
may be amended (including any amendment and restatement thereof), supplemented
or otherwise modified from time to time, including any agreement extending the
maturity of, refinancing, replacing, increasing the total commitment of, or
otherwise restructuring (including by way of adding Subsidiaries of the Company
as additional borrowers or guarantors thereunder) all or any portion of the
Indebtedness under such agreement or any successor or replacement agreement and
whether by the same or any other agent, lender or group of lenders,
(ii)&#160;any other senior term or revolving credit facilities with one or
more financial institutions and (iii)&#160;any refinancing, refunding,
renewal, replacement or extension in whole or in part of any of the foregoing.</p>
<p>&quot;<b>Currency Agreement</b>&quot; means in respect of a Person any
foreign exchange contract, currency swap agreement or other similar agreement as
to which such Person is a party or a beneficiary.</p>
<p>&quot;<b>Debt Commitment Letter</b>&quot; has the meaning specified in the
Purchase Agreement, as amended, supplemented or modified from time to time.</p>
<p>&quot;<b>Disqualified Stock</b>&quot; means (a)&#160;any Capital Stock of
the Company which, by its terms (or by the terms of any security into which it
is convertible or for which it is exchangeable) or upon the happening of any
event (i)&#160;matures (excluding any maturity as the result of an optional
redemption by the issuer thereof) or is mandatorily redeemable pursuant to a
sinking fund obligation or otherwise or is redeemable at the option of the
holder thereof, in whole or in part, on or prior to the Mandatory Redemption
Date, or (ii)&#160;is convertible into or exchangeable (unless at the sole
option of the issuer thereof) for (a)&#160;Indebtedness of the Company or
any Restricted Subsidiary or (b)&#160;any Capital Stock referred to in (i)
above, in each case at any time prior to the Mandatory Redemption Date.
Notwithstanding the preced&#45;</p>
<p>________________________</p>
<sup>
<p>a</sup> Information to be completed at closing.</p>
<p>ing sentence, (1)&#160;any Capital Stock that would constitute
Disqualified Stock solely because the holders of the Capital Stock have the
right to require the Company to repurchase such Capital Stock upon the
occurrence of a change of control or an asset sale shall not constitute
Disqualified Stock if the terms of such Capital Stock provide that the Company
may not repurchase or redeem any such Capital Stock if prohibited by the terms
hereof and (2)&#160;Capital Stock in respect of which the Company may have
an obligation of the type referred to in clause&#160;(iv) of the second
paragraph of Section&#160;7(b)(iv) shall not constitute Disqualified Stock.
For avoidance of doubt, the Redeemable Preferred Stock is not Disqualified
Stock.</p>
<p>&quot;<b>Dividend Payment Date</b>&quot; means each January&#160;1,
April&#160;1, June&#160;1 and October&#160;1 of each year on which
dividends shall be paid or are payable, any Redemption Date and any other date
on which dividends in arrears may be paid.</p>
<p>&quot;<b>Dividend Rate</b>&quot; has the meaning specified in
Section&#160;2(a) hereof.</p>
<p>&quot;<b>Earn&#45;Out Amount</b>&quot; shall have the meaning ascribed to
it in the Purchase Agreement.</p>
<p>&quot;<b>Exchange Act</b>&quot; means the Securities Exchange Act of 1934, as
amended, and the rules and regulations promulgated by the Commission thereunder.</p>
<p>&quot;<b>Exchange Date</b>&quot; means the date on which Redeemable Preferred
Stock is exchanged by the Company for Exchange Notes.</p>
<p>&quot;<b>Exchange Notes</b>&quot; shall have the meaning ascribed to it in
Section 6 hereof.</p>
<p>&quot;<b>Exchange Notice</b>&quot; shall have the meaning ascribed to it in
Section 6 hereof.</p>
<p>&quot;<b>Exchange Offer</b>&quot; means the exchange offer contemplated by
the Registration Rights Agreement.</p>
<p>&quot;<b>Existing Notes</b>&quot; means the Company&#39;s
11&#160;1/2% Senior Subordinated Notes Due 2006 and the related indenture
and supplemental indentures, as each may be amended or modified from time to
time (including in connection with the Acquisition); <i>provided</i> that no
such amendment or modification shall extend the final Stated Maturity of such
notes beyond 2006.</p>
<p>&quot;<b>fair market value</b>&quot; means, with respect to any asset or
property, the price which could be negotiated in an arm&#39;s&#45;length
transaction, for cash, between an informed and willing seller under no
compulsion to sell and an informed and willing buyer under no compulsion to buy.
Fair market value shall be conclusively determined by the Board of Directors of
the Company acting in good faith.</p>
<p>&quot;<b>First Dividend Payment Date</b>&quot; means the first Dividend
Payment Date following the occurrence of a Liquidity Condition or the
satisfaction of the conditions specified in Section 7(d)(II).</p>
<p>&quot;<b>Foreign Subsidiary</b>&quot; means a Subsidiary that is organized
under the laws of any country other than the United States and substantially all
of the assets of which are located outside the United States.</p>
<p>&quot;<b>GAAP</b>&quot; means generally accepted accounting principles in the
United States of America as in effect from time to time, including those set
forth in the opinions and pronouncements of the Accounting Principles Board of
the American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or in such other
statements by such other entity as approved by a significant segment of the
accounting profession.</p>
<p>&quot;<b>guarantee</b>&quot; means any obligation, contingent or otherwise,
of any Person directly or indirectly guaranteeing any Indebtedness of any other
Person and any obligation, direct or indirect, contingent or otherwise, of such
Person (i)&#160;to purchase or pay (or advance or supply funds for the
purchase or payment of) such Indebtedness of such other Person (whether arising
by virtue of partnership arrangements, or by agreement to keep&#45;well, to
purchase assets, goods, securities or services, to take&#45;or&#45;pay,
or to maintain financial statement conditions or otherwise) or
(ii)&#160;entered into for purposes of assuring in any other manner the
obligee to such Indebtedness of the payment thereof or to protect such obligee
against loss in respect thereof (in whole or in part); <i>provided</i>, <i>however</i>,
that the term &quot;guarantee&quot; shall not include endorsements for
collection or deposit in the ordinary course of business. The term
&quot;guarantee&quot; used as a verb has a corresponding meaning.</p>
<p>&quot;<b>Holder</b>&quot; means the record holder of shares of Redeemable
Preferred Stock.</p>
<p>&quot;<b>Incur</b>&quot; means issue, assume, guarantee, incur or otherwise
become liable for; <i>provided</i>, <i>however</i>, that any Indebtedness of a
Person existing at the time such person becomes a Restricted Subsidiary (whether
by merger, consolidation, acquisition or otherwise) shall be deemed to be
Incurred by such Restricted Subsidiary at the time it becomes a Restricted
Subsidiary.</p>
<p>&quot;<b>Indebtedness</b>&quot; means, (a) with respect to any Person on any
date of determination (without duplication), (i)&#160;the principal of and
premium (if any) in respect of indebtedness of such Person for borrowed money,
(ii)&#160;the principal of and premium (if any) in respect of obligations of
such Person evidenced by bonds, debentures, notes or other similar instruments,
(iii)&#160;all obligations of such Person in respect of letters of credit or
other similar instruments (including reimbursement obligations with respect
thereto) (other than obligations with respect to letters of credit securing
obligations (other than obligations described in clauses&#160;(i), (ii) and
(v)) entered into in the ordinary course of business of such Person to the
extent that such letters of credit are not drawn upon or, if and to the extent
drawn upon, such drawing is reimbursed no later than the tenth Business Day
following receipt by such Person of a demand for reimbursement following payment
on the letter of credit), (iv)&#160;all obligations of such Person to pay
the deferred and unpaid purchase price of property or services (except trade
payables and accrued expenses incurred in the ordinary course of business),
(v)&#160;all Capitalized Lease Obligations of such Person, (vi)&#160;all
Indebtedness of other Persons secured by a Lien on any asset of such Person,
whether or not such Indebtedness is assumed by such Person; <i>provided</i>, <i>however</i>,
that the amount of such Indebtedness shall be the lesser of the fair market
value of such asset at such date of determination and the amount of such
Indebtedness of such other Person, and (vii)&#160;all Indebtedness of other
Persons to the extent guaranteed by such Person and (b) any Preferred Stock of
any Restricted Subsidiary permitted under Section 7(h).</p>
<p>&quot;<b>Independent Evaluation Firm</b>&quot; has the meaning specified on
Section 7(f) hereof.</p>
<p>&quot;<b>Interest Rate Agreement</b>&quot; means with respect to any Person
any interest rate protection agreement, interest rate future agreement, interest
rate option agreement, interest rate swap agreement, interest rate cap
agreement, interest rate collar agreement, interest rate hedge agreement or
other similar agreement or arrangement as to which such Person is party or a
beneficiary.</p>
<p>&quot;<b>Investment</b>&quot; by any Person means any loan, advance or other
extension of credit or capital contribution (by means of transfers of cash or
other property to others or payments for property or services for the account or
use of others, or otherwise) to, or purchase or acquisition of Capital Stock,
bonds, notes, debentures or other securities or evidence of Indebtedness issued
by, any other Person, including any payment on a guarantee of any obligation of
such other Person, but shall not include trade accounts receivable in the
ordinary course of business. Upon any issuance or sale of Capital Stock of any
Restricted Subsidiary such that it ceases to be a Restricted Subsidiary, the
Company shall be deemed to have made an Investment in the retained Capital Stock
and other Investments in such Subsidiary at such time. For purposes of Section
7(b) and the definitions of &quot;Permitted Investments&quot; and
&quot;Unrestricted Subsidiary,&quot; with respect to a Restricted Subsidiary
that is designated as an Unrestricted Subsidiary, &quot;Investment&quot; shall
include the portion (proportionate to the Company&#39;s equity interest in
such Subsidiary) of the fair market value of the net assets of such Subsidiary
at the time that such Subsidiary is designated an Unrestricted Subsidiary and,
with respect to a Person that is designated as an Unrestricted Subsidiary
simultaneously with its becoming a Subsidiary of the Company,
&quot;Investment&quot; shall mean the Investment made by the Company and the
Restricted Subsidiaries to acquire such Subsidiary.</p>
<p>&quot;<b>Issuance Date</b>&quot; means (1) in the case of the
Series&#160;A1 Redeemable Preferred Stock, the Series&#160;B1 Redeemable
Preferred Stock and the Series&#160;C1 Redeemable Preferred Stock, the date
on which such Redeemable Preferred Stock is originally issued under this
Certificate of Designation and (2) in the case of the Series&#160;A2
Redeemable Preferred Stock, the Series&#160;B2 Redeemable Preferred Stock
and the Series&#160;C2 Redeemable Preferred Stock, the Exchange Date.</p>
<p>&quot;<b>Junior Securities</b>&quot; has the meaning specified in
Section&#160;6 hereof.</p>
<p>&quot;<b>Lien</b>&quot; means any mortgage, pledge, security interest,
encumbrance, lien or charge of any kind (including any conditional sale or other
title retention agreement or lease in the nature thereof).</p>
<p>&quot;<b>Liquidated Damages</b>&quot; has the meaning specified in the
Registration Rights Agreement.</p>
<p>&quot;<b>Liquidation Preference</b>&quot; means, with respect to a series of
Redeemable Preferred Stock, the Series&#160;A Liquidation Preference, the
Series&#160;B Liquidation Preference or the Series&#160;C Liquidation
Preference, as applicable.</p>
<p>&quot;<b>Liquidity Condition</b>&quot; means the date upon which audited
annual or unaudited quarterly consolidated financial information for the Company
and the Restricted Subsidiaries is available reflecting that the
Company&#39;s Adjusted Consolidated Pro Forma Coverage Ratio is greater than
or equal to the ratios specified below for the periods specified below:</p>
<p ALIGN="RIGHT">&nbsp;
<table CELLSPACING="0" CELLPADDING="1" WIDTH="653">
  <tr>
    <td WIDTH="590" VALIGN="TOP">
      <blockquote>
        <p>Periods ending on or prior to March 31, 2003
      </blockquote>
    </td>
    <td WIDTH="55" VALIGN="TOP">
      <p>3.50:1.0</td>
  </tr>
  <tr>
    <td WIDTH="590" VALIGN="TOP">
      <blockquote>
        <p>Period ending on or between April 1, 2003 and June 30, 2003
      </blockquote>
    </td>
    <td WIDTH="55" VALIGN="TOP">
      <p>
      3.25:1.0</td>
  </tr>
  <tr>
    <td WIDTH="590" VALIGN="TOP">
      <blockquote>
        <p>Periods ending on or between July 1, 2003 and December 31, 2003
      </blockquote>
    </td>
    <td WIDTH="55" VALIGN="TOP">
      <p>
      3.00:1.0</td>
  </tr>
  <tr>
    <td WIDTH="590" VALIGN="TOP">
      <blockquote>
        <p>Periods ending on or between January 1, 2004 and December 31, 2004
      </blockquote>
    </td>
    <td WIDTH="55" VALIGN="TOP">
      <p>
      2.75:1.0</td>
  </tr>
  <tr>
    <td WIDTH="590" VALIGN="TOP">
      <blockquote>
        <p>Periods ending on and after January 1, 2005
      </blockquote>
    </td>
    <td WIDTH="55" VALIGN="TOP">
      <p>2.50:1.0.</td>
  </tr>
</table>
<p>&quot;<b>Material Breach</b>&quot; means a breach of any agreement or
instrument governing Indebtedness involving a principal amount, individually or
in the aggregate, of $5.0 million or more.</p>
<p>&quot;<b>Maturity Redemption Date</b>&quot; with respect to a series of
Redeemable Preferred Stock means the mandatory redemption date for such series
specified in Section&#160;5(b)(i) hereof.</p>
<p>&quot;<b>Net Available Proceeds</b>&quot; has the meaning specified in
Section 5(b)(iii) hereof.</p>
<p>&quot;<b>Net Cash Proceeds</b>&quot; means the aggregate cash proceeds
received by the Company or any of its Restricted Subsidiaries in respect of any
Asset Disposition (including, without limitation, any cash received upon the
sale or other disposition of any non&#45;cash consideration received in any
Asset Disposition), net of the direct costs relating to such Asset Disposition
(including, without limitation, legal, accounting and investment banking fees,
and sales commissions) and any related expenses Incurred as a result thereof,
taxes paid or payable as a result thereof, amounts required to be applied to the
repayment of Indebtedness secured by a lien on the asset or assets that were the
subject of such Asset Disposition and any reserve for adjustment in respect of
the sale price of such asset or assets established in accordance with GAAP.</p>
<p>&quot;<b>Optional Redemption Date</b>&quot; has the meaning specified in
Section&#160;5(a)(i) hereof.</p>
<p>&quot;<b>Parent</b>&quot; means Collins & Aikman Corporation, a Delaware
corporation, and any successor thereto that continues to control the Company.</p>
<p>&quot;<b>Par Offer</b>&quot; means any offer to purchase for cash any and all
Textron Shares at a purchase price per share equal to the aggregate Liquidation
Preference of the Textron Shares, plus accumulated and unpaid dividends
(including Total Cash Dividends in Arrears), if any; <i>provided </i>that
(1)&#160;any such offer shall be made pursuant to a written notice addressed
to Textron, with instructions as to the manner in which the offer may be
accepted and Textron Shares tendered for purchase, and shall remain available
for acceptance for not less than 10 Business Days and (2)&#160;any and all
Textron Shares as to which an acceptance has been made, and in respect of which
certificates therefor have been timely delivered to the offeror, shall have been
purchased. The written notice shall state that (i)&#160;it is a Par Offer;
(ii)&#160;any Textron Shares not delivered and duly endorsed for transfer to
the offeror on a timely basis will remain outstanding and continue to accumulate
dividends, but will have no further benefit of Section 7(d);
(iii)&#160;unless the offeror defaults in the payment of the Par Offer, all
Textron Shares delivered for payment pursuant to the Par Offer will cease to
accumulate dividends upon payment; and (iv)&#160;the Par Offer must be
accepted by the offeror in whole and may not be accepted in part. A &quot;<b>Par
Offer</b>&quot; may be made and consummated by any Person, whether or not the
Company or one of its Affiliates, pursuant to these provisions and shall
nonetheless be an effective Par Offer.</p>
<p>&quot;<b>Parity Securities</b>&quot; has the meaning specified in
Section&#160;6 hereof.</p>
<p>&quot;<b>Permitted Indebtedness and Preferred Stock</b>&quot; means:</p>
<blockquote>
  <blockquote>
    <p>Indebtedness Incurred by the Company or any Restricted Subsidiary
    pursuant to one or more Credit Facilities; <i>provided</i>, <i>however</i>,
    that the aggregate principal amount of all Indebtedness Incurred pursuant to
    this clause&#160;(i)&#160;does not exceed
    $[&#160;&#160;&#160;&#160;&#160;] million at any time
    outstanding less the amount of any Net Cash Proceeds from an Asset
    Disposition used to permanently reduce the availability under the term loan
    portion of any such Credit Facilities; <sup>a</p>
    </sup>
    <p>Indebtedness of the Company or any Restricted Subsidiary under [the
    Bridge Financing and] any Acquisition Notes and any replacement, refunding,
    refinancing, renewal or extension thereof in an aggregate principal amount
    or liquidation preference not to exceed
    $[&#160;&#160;&#160;&#160;&#160;] million at any time
    outstanding; <sup>b</p>
    </sup>
    <p>Indebtedness of any Foreign Subsidiary (other than a Foreign Subsidiary
    organized under the laws of Canada) incurred for working capital purposes
    not to exceed at any time outstanding the sum of (x)&#160;the
    consolidated book value of the accounts receivable of such Foreign
    Subsidiary plus (y)&#160;the consolidated book value of the inventories
    of such Foreign Subsidiary; <sup>c</p>
    </sup>
    <p>Indebtedness of the Company or any Restricted Subsidiary constituting and
    any replacement, refunding or refinancing of a Receivables Facility and any
    replacement, refunding, refinancing, renewal or extension thereof; <i>provided</i>
    that the aggregate principal amount of Indebtedness Incurred pursuant to
    this clause&#160;(iv) shall not exceed
    $[&#160;&#160;&#160;&#160;] million at any time outstanding;
    <sup>d</p>
    </sup>
    <p>Indebtedness of the Company or any Restricted Subsidiary represented by
    Capitalized Lease Obligations, mortgage financing or purchase money
    obligations, in each case Incurred for the purpose of financing all or any
    part of the purchase price</p>
  </blockquote>
</blockquote>
<font SIZE="2">
<p>________________________</p>
<sup>
<p>a </sup>To provide 15% flexibility in amount as compared with the similar
basket in the Acquisition<sup> </sup>Notes or, if the Acquisition Notes are not
issued on or prior to the first Issuance Date, the amount will equal the total
commitments under Credit Facility to be entered into in connection with the
Acquisition plus an additional 15% to allow for future growth.</p>
<sup>
<p>b</sup> To equal amount of Bridge Financing or Acquisition Notes.</p>
<sup>
<p>c</sup> To be limited in the same manner as the Acquisition Notes, if any,
plus a 15% margin in the case of a dollar limitation or receivables plus
inventory limitation.</p>
<sup>
<p>d</sup> To provide 25% in excess of an amount equal to the US/Canadian
Receivables Facility entered into at Acquisition closing.</p>
</font>
<blockquote>
  <blockquote>
    <p>or cost of construction or improvement of property or Incurred to
    refinance any such purchase price or cost of construction or improvement, in
    each case Incurred no later than 365 days after the date of such acquisition
    or the date of completion of such construction or improvement; <sup>a</p>
    </sup>
    <p>Indebtedness of the Company or any Restricted Subsidiary in a principal
    amount or liquidation preference not to exceed
    $[&#160;&#160;&#160;&#160;] million outstanding at any time
    (it being understood that any Indebtedness Incurred under this
    clause&#160;(vi) shall cease to be outstanding for purposes of this
    clause&#160;(vi) but shall be deemed to be Incurred or issued for
    purposes of the first paragraph of Section&#160;7(a) from and after the
    first date on which the Company or such Restricted Subsidiary could have
    Incurred such Indebtedness under the first paragraph of
    Section&#160;7(a) without reliance upon this clause&#160;(vi)); <sup>b</p>
    </sup>
    <p>(A)&#160;Indebtedness of the Company owing to and held by any
    Restricted Subsidiary or (B)&#160;Indebtedness of a Restricted
    Subsidiary owing to and held by the Company or any Restricted Subsidiary; <i>provided</i>,
    <i>however</i>, that any subsequent issuance (other than directors&#39;
    qualifying shares) or transfer of any Capital Stock or any other event which
    results in any such Restricted Subsidiary ceasing to be a Restricted
    Subsidiary or any subsequent transfer of any such Indebtedness (except, in
    the case of subclause&#160;(A), to a Restricted Subsidiary or, in the
    case of subclause&#160;(B), to the Company or a Restricted Subsidiary)
    shall be deemed in each case to constitute the Incurrence of such
    Indebtedness;</p>
    <p>(A) other Indebtedness outstanding on the Issuance Date of the
    Series&#160;A1 Redeemable Preferred Stock, the Series&#160;B1
    Redeemable Preferred Stock and the Series&#160;C1 Redeemable Preferred
    Stock, including without limitation the Existing Notes and Indebtedness
    assumed by reason of the Acquisition, and any refinancing, replacement,
    refunding, renewal or extension thereof and (B) any refinancing, re&#45;</p>
    <p>_________________________</p>
  </blockquote>
  <sup><font SIZE="2">
  <p>a</font></sup><font SIZE="2"> To be limited to a dollar amount if so
  provided in the Acquisition Notes, plus a 15% margin.</p>
  <sup>
  <p>b</sup> To equal amount of &quot;rainy day&quot; basket in Acquisition
  Notes plus 20% or, if Acquisition Notes are not issued, an amount to be
  reasonably acceptable to the Company and Textron, but not less than $60
  million (<i>i.e</i>., 120% of the rainy day basket under Existing Notes) in
  any event.</p>
  </font>
  <blockquote>
    <p>placement, refunding, renewal or extension of any Indebtedness Incurred
    under the first paragraph of Section 7(a);</p>
    <p>Indebtedness of the Company or any Restricted Subsidiary (A)&#160;in
    respect of performance bonds, bankers&#39; acceptances and surety or
    appeal bonds provided by the Company or any of the Restricted Subsidiaries
    to their customers in the ordinary course of their business and not for
    money borrowed, (B)&#160;in respect of performance bonds or similar
    obligations of the Company or any of the Restricted Subsidiaries for or in
    connection with pledges, deposits or payments made or given in the ordinary
    course of business and not for money borrowed in connection with or to
    secure statutory, regulatory or similar obligations, including obligations
    under health, safety or environmental obligations, (C)&#160;arising from
    guarantees to suppliers, lessors, licensees, contractors, franchises or
    customers of obligations (other than Indebtedness) incurred in the ordinary
    course of business and not for money borrowed and (D)&#160;under
    Currency Agreements, Interest Rate Agreements and Commodity Agreements; <i>provided</i>,
    <i>however</i>, that in the case of subclause&#160;(D), such agreements
    are entered into for <i>bona fide</i> hedging purposes of the Company or any
    of the Restricted Subsidiaries (as determined in good faith by the Company);</p>
    <p>Indebtedness of the Company or any Restricted Subsidiary arising from
    agreements providing for indemnification, adjustment of purchase price or
    similar obligations, or from guarantees or letters of credit, surety bonds
    or performance bonds securing any obligations of the Company or any of the
    Restricted Subsidiaries pursuant to such agreements, in each case Incurred
    or issued in connection with the disposition of any business, assets or
    Subsidiary of the Company in a principal amount or liquidation preference
    not to exceed the gross proceeds actually received by the Company or any of
    the Restricted Subsidiaries in connection with such disposition;</p>
    <p>Indebtedness consisting of (A)&#160;guarantees by the Company or any
    Restricted Subsidiary of Indebtedness Incurred or Preferred Stock issued by
    a Restricted Subsidiary otherwise permitted hereunder,
    (B)&#160;guarantees by a Restricted Subsidiary of Indebtedness or
    Preferred Stock Incurred or issued by the Company otherwise permitted
    hereunder, or (C) guarantees by the Company or any Restricted Subsidiary of
    Indebtedness Incurred by a Foreign Subsidiary in the ordinary course of
    business; and</p>
    <p>Indebtedness consisting of Preferred Stock of Restricted Subsidiaries to
    the extent that such Preferred Stock is issued or sold in accordance with
    Section&#160;7(h) hereof.</p>
  </blockquote>
</blockquote>
<p>For the purposes of determining Indebtedness permitted above in connection
with a replacement, refunding, refinancing, renewal or extension of such
Indebtedness (a &quot;<b>Refinancing</b>&quot; and the term &quot;<b>Refinanced</b>&quot;
having a correlative meaning), the aggregate principal amount of Indebtedness
Incurred in connection with such Refinancing shall not exceed the principal
amount of the Indebtedness being Refinanced, plus the amount of any premium
required to be paid in connection with such Refinancing pursuant to the terms of
the Indebtedness being Refinanced or the amount of any premium reasonably
determined by the Company as necessary to accomplish such Refinancing by means
of a tender offer or privately negotiated purchase or repayment, plus the fees
and expenses of the Company or Restricted Subsidiary, as the case may be,
Incurred in connection with such Refinancing.</p>
<p>&quot;<b>Permitted Investments</b>&quot; <sup>a</sup> means
(i)&#160;Investments in cash equivalents, (ii)&#160;any Investments
included in the definition of Permitted Indebtedness, including in respect of
Currency Agreements, Interest Rate Agreements and Commodity Agreements,
(iii)&#160;Investments in existence on the Issuance Date of the
Series&#160;A1 Redeemable Preferred Stock, Series&#160;B1 Redeemable
Preferred Stock and Series&#160;C1 Redeemable Preferred Stock,
(iv)&#160;Investments in any Restricted Subsidiary by the Company or any
Restricted Subsidiary, including any Investment made to acquire such Restricted
Subsidiary, (v)&#160;Investments in any Receivables Facility,
(vi)&#160;Investments in the Company by any Restricted Subsidiary,
(vii)&#160;sales of goods or services on trade credit terms consistent with
the Company&#39;s and its Subsidiaries&#39; past practices or otherwise
consistent with trade credit terms in common use in the industry and recorded as
accounts receivable on the balance sheet of the Person making such sale,
(viii)&#160;loans or advances to employees for purposes of purchasing common
stock of Parent or the Company in an aggregate amount outstanding at any one
time not to exceed $[&#160;&#160;&#160;] million and other loans and
advances to employees of the Company and its Subsidiaries in the ordinary course
of business, including travel, moving and other like advances,
(ix)&#160;loans or advances to vendors or contractors of the Company and its
Subsidiaries (other than Affiliates of the Company) in the ordinary course of
business, (x)&#160;lease, utility and other similar deposits in the ordinary
course of business, (xi)&#160;stock, obligations or securities received in
the ordinary course of business in settlement of debts owing to the Company or a
Subsidiary thereof as a result of foreclosure, perfection, enforcement of any
Lien or in a bankruptcy proceeding, (xii)&#160;Investments in Unrestricted
Subsidiaries, partnerships or joint ventures involving the Company or its
Restricted Subsidiaries if the amount of such Investment (after taking into
account the amount of all other Investments made pursuant to this clause (xii),
less any return of capital realized or</p>
<p>________________________</p>
<blockquote>
  <sup>
  <p>a</sup> Baskets and concepts are to be modified to provide equivalent
  flexibility to the Acquisition Notes plus additional flexibility reasonably
  acceptable to the Company and Textron; if Acquisition Notes are not issued on
  or prior to the first Issuance Date, the Company and Textron will negotiate to
  complete the blank information and to supplement this definition for
  additional identified ordinary course needs on a basis reasonably acceptable
  to each of them.</p>
</blockquote>
<p>any repayment of principal received on such Permitted Investments, or any
release or other cancellation of any guarantee constituting such Permitted
Investment, which has not at such time been reinvested in Permitted Investments
made pursuant to this clause (xii)) does not exceed the greater of
$[&#160;&#160;&#160;] million or [&#160;&#160;&#160;]%
of the consolidated assets of the Company and the Restricted Subsidiaries,
(xiii)&#160;Investments in Persons to the extent any such Investment
represents the non&#45;cash consideration received by the Company or the
Restricted Subsidiaries in connection with an Asset Disposition and (xiv)
Investments consisting of guarantees of Indebtedness of Foreign Subsidiaries
Incurred in the ordinary course of business.</p>
<p>&quot;<b>Permitted Restricted Period Debt</b>&quot; means Indebtedness (i)
under any revolving credit or letter of credit facility required for funding the
Company and the Restricted Subsidiaries in the ordinary course of business
(including under the Credit Facility), (ii) of the type set forth in
clauses&#160;(i), (iii), (iv), (v), (vi), (vii), (viii), (ix), (x) and
(xi)&#160;of the definition of &quot;Permitted Indebtedness&quot; and any
Refinancing thereof and (iii) Incurred for the purpose of Refinancing
Indebtedness of the Company or a Restricted Subsidiary having a Stated Maturity
within one year of the date of such Incurrence; provided in each case that the
proceeds to the Company and the Restricted Subsidiaries from the Incurrence of
any such Indebtedness are not applied as consideration in respect of any Asset
Acquisition.</p>
<p>&quot;<b>Person</b>&quot; means any individual, corporation, limited
liability company, partnership, joint venture, association, joint&#45;stock
company, trust, unincorporated organization or government or any agency or
political subdivision thereof.</p>
<p>&quot;<b>Preferred Stock</b>&quot;, means Capital Stock of any class or
classes (however designated) which is preferred as to the payment of dividends
or distribution of funds, or as to the distribution of assets upon any voluntary
or involuntary liquidation or dissolution of such corporation, over shares of
Capital Stock of any other class of such corporation.</p>
<p>&quot;<b>Projected Consolidated Interest Expense</b>&quot; means, with
respect to a particular Asset Acquisition, the projected Consolidated Interest
Expense (without giving effect to clause (viii) thereof and assuming for this
purpose that the acquired Persons or assets are the &quot;Company and the
Restricted Subsidiaries&quot;) attributable to Indebtedness Incurred or assumed
to effect the particular Asset Acquisition, as set forth in the Certified
Projections with respect to such Asset Acquisition, for the time period for
which the Adjusted Consolidated Pro Forma Coverage Ratio is being calculated
(but not to cover any time period in which the particular Asset Acquisition had
not been made).</p>
<p>&quot;<b>Projected Period Cash Flow</b>&quot; means, with respect to a
particular Asset Acquisition, the projected Consolidated Cash Flow (assuming for
this purpose that the acquired Persons or assets are the &quot;Company and the
Restricted Subsidiaries&quot;) of the Persons or assets which are the subject of
such Asset Acquisition, as set forth in the Certified Projections with respect
to such Asset Acquisition, for the time period for which the Adjusted
Consolidated Pro Forma Coverage Ratio is being calculated (but not to cover any
time period in which the particular Asset Acquisition had not been made).</p>
<p>&quot;<b>Projected Time Adjusted Acquisition Cash Flow</b>&quot; means the
sum of the following calculations determined for each Asset Acquisition effected
after the Issuance Date of the Series&#160;A1 Redeemable Preferred Stock,
Series&#160;B1 Redeemable Preferred Stock and Series&#160;C1 Redeemable
Preferred Stock. The following calculation shall be made for each Asset
Acquisition utilizing the time periods of the Certified Projections for the
Subject Acquisition for which the Adjusted Consolidated Pro Forma Coverage Ratio
is being calculated: the Time Period Factor for the subject Acquisition shall be
multiplied by the Projected Period Cash Flow of such Asset Acquisition.</p>
<p>&quot;<b>Projected Time Adjusted Acquisition Interest Expense</b>&quot; means
the sum of the following calculations determined for each Asset Acquisition
effected after the Issuance Date of the Series&#160;A1 Redeemable Preferred
Stock, Series&#160;B1 Redeemable Preferred Stock and Series&#160;C1
Redeemable Preferred Stock. For each Asset Acquisition the following calculation
shall be made utilizing the time periods of the Certified Projections for which
the Adjusted Consolidated Pro Forma Coverage Ratio is being calculated: the Time
Period Factor with respect to the subject Acquisition shall be multiplied by the
Projected Consolidated Interest Expense of such Asset Acquisition.</p>
<p>&quot;<b>Purchase Agreement</b>&quot; means the Purchase Agreement dated
August&#160;7, 2001 among Textron, Parent and the Company as amended and
restated as of November [&#160;&#160;&#160;], 2001.</p>
<p>&quot;<b>Qualified Bank</b>&quot; has the meaning specified in
Section&#160;5(c)(iv) hereof.</p>
<p>&quot;<b>Qualified Capital Stock</b>&quot; of the Company shall mean any
Capital Stock of the Company which is not Disqualified Stock.</p>
<p>&quot;<b>Receivables Facility</b>&quot; means any receivables financing
facilities pursuant to which the Company or any of its Subsidiaries sells,
transfers, assigns or pledges its accounts receivable and/or any rights
ancillary thereto to a special purpose entity or trust and in connection
therewith such entity or trust Incurs Indebtedness secured by such accounts
receivable and/or ancillary rights with customary repurchase obligations for
breaches of representations warranties or covenants or recourse based upon the
collectability of the accounts receivable or ancillary rights sold, including,
without limitation the Receivables Facility contemplated by the Debt Commitment
Letter.</p>
<p>&quot;<b>Receivables Financing Subsidiary</b>&quot; means a Subsidiary formed
for the purpose of monetizing accounts receivable of the Company and/or one or
more of its Subsidiaries whose assets consent of cash, such accounts receivable
and related intangibles and assets.</p>
<p>&quot;<b>Redeemable Preferred Stock</b>&quot; has the meaning set forth in
Section&#160;1 hereof.</p>
<p>&quot;<b>Redemption Date</b>&quot; means the Optional Redemption Date, the
Maturity Redemption Date, the Change of Control Redemption Date or the Asset
Disposition Redemption Date, as the case may be.</p>
<p>&quot;<b>Redemption Notice</b>&quot; has the meaning specified in
Section&#160;5(c)(i) hereof.</p>
<p>&quot;<b>Redemption Price</b>&quot; means the price at which the Redeemable
Preferred Stock may be redeemed.</p>
<p>&quot;<b>Registration Rights Agreement</b>&quot; means that certain Preferred
Stock Registration Rights and other Rights Agreement, dated as of the Issuance
Date of the Series A1 Redeemable Preferred Stock, Series B1 Redeemable Preferred
stock and the Series C1 Redeemable Preferred Stock, by and between the Company
and Textron, as amended or modified in accordance with its terms.</p>
<p>&quot;<b>Remaining Net Available Proceeds</b>&quot; has the meaning specified
in Section 5(b)(iii) hereof.</p>
<p>&quot;<b>Restricted Payment</b>&quot; has the meaning specified in
Section&#160;7(b) hereof.</p>
<p>&quot;<b>Restricted Period</b>&quot; has the meaning specified in Section
7(d) hereof.</p>
<p>&quot;<b>Restricted Subsidiary</b>&quot; means any Subsidiary of the Company
other than an Unrestricted Subsidiary.</p>
<p>&quot;<b>Securities Act</b>&quot; means the Securities Act of 1933, as
amended, and the rules and regulations promulgated by the Commission thereunder.</p>
<p>&quot;<b>Senior Securities</b>&quot; has the meaning specified in
Section&#160;6 hereof.</p>
<p>&quot;<b>Series&#160;A Accrued Dividends</b>&quot; has the meaning
specified in Section 2(a) hereof.</p>
<p>&quot;<b>Series&#160;A Additional Dividends</b>&quot; means, as of any
date of determination with respect to a share of Series&#160;A Redeemable
Preferred Stock, the aggregate amount of dividends accrued upon the
Series&#160;A Cash Dividends in Arrears in respect of such share pursuant to
Section 2(c), to the extent that payment in cash of such dividends has not been
made on or prior to such date of determination.</p>
<p>&quot;<b>Series&#160;A Cash Dividends in Arrears</b>&quot; means, as of
any date of determination with respect to a share of Series&#160;A
Redeemable Preferred Stock, the aggregate of all accumulated and unpaid
dividends upon such share of Series&#160;A Redeemable Preferred Stock that
were required to be paid in cash on any Dividend Payment Date occurring prior to
such date of determination, to the extent that payment in cash of such dividends
has not been made on or prior to such date of determination.</p>
<p>&quot;<b>Series&#160;A Dividend Rate</b>&quot; has the meaning set forth
in Section&#160;2(a) hereof.</p>
<p>&quot;<b>Series&#160;A Liquidation Preference</b>&quot; means with
respect to a share of Series&#160;A Redeemable Preferred Stock, $1,000 plus
the aggregate amount of all Series&#160;A Accrued Dividends in respect of
such share through and including the date of determination.</p>
<p>&quot;<b>Series&#160;A Redeemable Preferred Stock</b>&quot; shall have
the meaning ascribed to it in Section&#160;1(a) hereof.</p>
<p>&quot;<b>Series&#160;A1 Exchange Notes</b>&quot; shall have the meaning
ascribed to it in Section 6 hereof.</p>
<p>&quot;<b>Series&#160;A1 Redeemable Preferred Stock</b>&quot; shall have
the meaning ascribed to it in Section&#160;1(a) hereof.</p>
<p>&quot;<b>Series&#160;A2 Exchange Notes</b>&quot; shall have the meaning
ascribed to it in Section 6 hereof.</p>
<p>&quot;<b>Series&#160;A2 Redeemable Preferred Stock</b>&quot; shall have
the meaning ascribed to it in Section&#160;1(a) hereof.</p>
<p>&quot;<b>Series&#160;B Accrued Dividends</b>&quot; has the meaning
specified in Section 2(a) hereof.</p>
<p>&quot;<b>Series&#160;B Additional Dividends</b>&quot; means, as of any
date of determination with respect to a share of Series&#160;B Redeemable
Preferred Stock, the aggregate amount of dividends accrued upon the
Series&#160;B Cash Dividends in Arrears in respect of such share pursuant to
Section 2(c), to the extent that payment in cash of such dividends has not been
made on or prior to such date of determination.</p>
<p>&quot;<b>Series&#160;B Cash Dividends in Arrears</b>&quot; means, as of
any date of determination with respect to a share of Series&#160;B
Redeemable Preferred Stock, the aggregate of all accumulated and unpaid
dividends upon such share of any Series&#160;B Redeemable Preferred Stock
that were required to be paid in cash on any Dividend Payment Date occurring
prior to such date of determination, to the extent that payment in cash of such
dividends has not been made on or prior to such date of determination.</p>
<p>&quot;<b>Series&#160;B Dividend Rate</b>&quot; has the meaning set forth
in Section&#160;2(a) hereof.</p>
<p>&quot;<b>Series&#160;B Liquidation Preference</b>&quot; means $1,000 plus
the aggregate amount of all Series&#160;B Accrued Dividends through and
including the date of determination.</p>
<p>&quot;<b>Series&#160;B Redeemable Preferred Stock</b>&quot; shall have
the meaning ascribed to it in Section&#160;1(a) hereof.</p>
<p>&quot;<b>Series&#160;B1 Exchange Notes</b>&quot; shall have the meaning
ascribed to it in Section 6 hereof.</p>
<p>&quot;<b>Series&#160;B1 Redeemable Preferred Stock</b>&quot; shall have
the meaning ascribed to it in Section&#160;1(a) hereof.</p>
<p>&quot;<b>Series&#160;B2 Exchange Notes</b>&quot; shall have the meaning
ascribed to it in Section 6 hereof.</p>
<p>&quot;<b>Series&#160;B2 Redeemable Preferred Stock</b>&quot; shall have
the meaning ascribed to it in Section&#160;1(a) hereof.</p>
<p>&quot;<b>Series&#160;C Accrued Dividends</b>&quot; has the meaning
specified in Section 2(a) hereof.</p>
<p>&quot;<b>Series&#160;C Additional Dividends</b>&quot; means, as of any
date of determination with respect to a share of Series&#160;C Redeemable
Preferred Stock, the aggregate amount of dividends accrued upon the
Series&#160;C Cash Dividends in Arrears in respect of such share pursuant to
Section 2(c), to the extent that payment in cash of such dividends has not been
made on or prior to such date of determination.</p>
<p>&quot;<b>Series&#160;C Cash Dividends in Arrears</b>&quot; means, as of
any date of determination with respect to a share of Series&#160;C
Redeemable Preferred Stock, the aggregate of all accumulated and unpaid
dividends upon such share of any Series&#160;C Redeemable Preferred Stock
that were required to be paid in cash on any Dividend Payment Date occurring
prior to such date of determination, to the extent that payment in cash of such
dividends has not been made on or prior to such date of determination.</p>
<p>&quot;<b>Series&#160;C Dividend Rate</b>&quot; has the meaning set forth
in Section&#160;2(a) hereof.</p>
<p>&quot;<b>Series&#160;C Liquidation Preference</b>&quot; means $1,000 plus
the aggregate amount of all Series&#160;C Accrued Dividends through and
including the date of determination.</p>
<p>&quot;<b>Series&#160;C Redeemable Preferred Stock</b>&quot; shall have
the meaning ascribed to it in Section 1(a) hereof.</p>
<p>&quot;<b>Series&#160;C1 Exchange Notes</b>&quot; shall have the meaning
ascribed to it in Section 6 hereof.</p>
<p>&quot;<b>Series&#160;C1 Redeemable Preferred Stock</b>&quot; shall have
the meaning ascribed to it in Section 1(a) hereof.</p>
<p>&quot;<b>Series&#160;C2 Exchange Notes</b>&quot; shall have the meaning
ascribed to it in Section 6 hereof.</p>
<p>&quot;<b>Series&#160;C2 Redeemable Preferred Stock</b>&quot; shall have
the meaning ascribed to it in Section 1(a) hereof.</p>
<p>&quot;<b>Significant Subsidiary</b>&quot; means any Restricted Subsidiary
that would be a &quot;significant subsidiary&quot; of the Company within the
meaning of Rule 1&#45;02 under Regulation S&#45;X promulgated by the
Securities and Exchange Commission.</p>
<p>&quot;<b>Sponsor</b>&quot; means Heartland Industrial Partners, L.P. and its
Affiliates.</p>
<p>&quot;<b>Stated Maturity</b>&quot; means, with respect to any other
Indebtedness, means the date specified in the instrument governing such
Indebtedness as the fixed date on which the principal of such Indebtedness, or
any installment of interest thereon, is due and payable.</p>
<p>&quot;<b>Subsidiary</b>&quot; of any Person means any corporation,
association, partnership or other business entity of which more than 50% of the
total voting power of shares of Capital Stock or other interests (including
partnership interests) entitled (without regard to the occurrence of any
contingency) to vote in the election of directors, managers or trustees thereof
is at the time owned or controlled, directly or indirectly, by (i) such Person,
(ii) such Person and one or more Subsidiaries of such Person or (iii) one or
more Subsidiaries of such Person. Unless otherwise specified herein, each
reference to a Subsidiary shall refer to a Subsidiary shall refer to a
Subsidiary of the Company.</p>
<p>&quot;<b>Surviving Entity</b>&quot; has the meaning specified in
Section&#160;7(e)(i).</p>
<p>&quot;<b>Textron</b>&quot; means Textron, Inc. and its legal successors.</p>
<p>&quot;<b>Textron Shares</b>&quot; means all shares of Series&#160;A
Redeemable Preferred Stock held beneficially and of record solely by Textron
and/or any of Textron&#39;s Subsidiaries to the extent solely and
continuously beneficially owned since the Issuance Date of the
Series&#160;A1 Preferred Stock; <i>provided</i> that the Company may require
reasonable certifications and indemnities from Textron as to such beneficial
ownership and continuous beneficial ownership since the Issuance Date of the
Series&#160;A1 Preferred Stock as a condition to complying with the
provisions of, or determining eligibility for, a Par Offer or for ascertaining
the need to comply with the penultimate paragraph of Section&#160;7(b).</p>
<p>&quot;<b>Time Period Factor</b>&quot; is to be utilized in order to determine
the portion of the annual Certified Projections to be utilized when the four
fiscal quarter period for which the Adjusted Consolidated Pro Forma Coverage
Ratio is being calculated doesn&#39;t match. To that end, the portion of any
fiscal year set forth in the Certified Projections to be utilized will be based
upon, with respect to a particular Asset Acquisition, the fraction obtained by
dividing (1) the actual number of days of a particular fiscal year of the
Company to be reflected in Adjusted Consolidated Pro Forma Coverage Ratio
by&#160;(2)&#160; 365 days. In addition, to the extent an Asset
Acquisition was consummated during the four fiscal quarter period for which the
Adjusted Consolidated Pro Forma Coverage Ratio is being calculated (<i>i.e.</i>,
less than a full year), the Time Period Factor will equal the fraction obtained
by dividing&#160;(1) the actual number of days for which the Asset
Acquisition has been included in Consolidated Cash Flow of the Company by (2)
365 days.</p>
<p>&quot;<b>Total Cash Dividends in Arrears</b>&quot; means, with respect to any
share of Redeemable Preferred Stock at any date of determination, the total of
(1) the Cash Dividends in Arrears with respect to such share, if any, at the
date of determination and (2) the associated Additional Dividends with respect
to such share at such date of determination.</p>
<p>&quot;<b>Total Liquidity Dividends in Arrears</b>&quot; means, with respect
to any Textron Share at any date of determination, the total of (1) the
aggregate of all accumulated and unpaid Liquidity Dividends upon such Textron
Share, if any, at the date of determination and (2) the associated Additional
Dividends with respect to such share at such date of determination.</p>
<p>&quot;<b>Unrestricted Subsidiary</b>&quot; means (i)&#160;any Subsidiary
of the Company that at the time of determination shall be designated an
Unrestricted Subsidiary by the Board of Directors in the manner provided below,
(ii)&#160;any Receivables Financing Subsidiary and (iii)&#160;any
Subsidiary of an Unrestricted Subsidiary. The Board of Directors may designate
any Subsidiary of the Company (including any newly acquired or newly formed
Subsidiary of the Company) to be an Unrestricted Subsidiary unless such
Subsidiary or any of its Subsidiaries owns any Capital Stock or Indebtedness of,
or owns or holds any Lien on any property of, the Company or any Restricted
Subsidiary of the Company that is not a Subsidiary of the Subsidiary to be so
designated to the extent not otherwise permitted hereby; <i>provided</i>, <i>however</i>,
that after giving effect to any such designation, the Company could
(1)&#160;Incur $1.00 of Indebtedness under the first paragraph of Section
7(a) and (2)&#160;make an Investment in such Subsidiary under Section 7(b).
Any such designation shall be deemed to have resulted in an Investment by the
Company for purposes of Section&#160;7(b). The Board of Directors may
designate any Unrestricted Subsidiary (other than a Receivables Financing
Subsidiary) to be a Restricted Subsidiary; <i>provided</i>, <i>however</i>, that
all Indebtedness of such Unrestricted Subsidiary outstanding immediately
following such designation, if Incurred at such time, would have been permitted
to be Incurred for all purposes of this Certificate of Designation. Any such
designation by the Board of Directors shall be evidenced to the holders of the
Redeemable Preferred Stock by promptly delivering to the transfer agent for the
Preferred Stock a copy of the Board Resolution giving effect to such designation
and an Officers&#39; Certificate certifying that such designation complied
with the foregoing provisions. Notwithstanding the foregoing, any Subsidiary
which shall be designated an &quot;Unrestricted Subsidiary&quot; in accordance
with the terms of the Acquisition Notes shall be deemed to be an Unrestricted
Subsidiary for purposes hereunder.</p>
<p>&quot;<b>Voting Rights Triggering Event</b>&quot; has the meaning set forth
above in Section&#160;4(b) hereof.</p>
<p>&quot;<b>Voting Stock</b>&quot; means any class or classes of Capital Stock
pursuant to which the holders thereof have the general voting power under
ordinary circumstances to elect at least a majority of the board of directors,
managers or trustees of any Person (irrespective of whether or not, at the time,
stock of any other class or classes shall have, or might have, voting power by
reason of the happening of any contingency).</p>
<p>&quot;<b>Wholly Owned Subsidiary</b>&quot; of any Person means a Subsidiary
of such Person all of the outstanding Capital Stock or other ownership interests
of which (other than directors&#39; qualifying shares) shall at the time be
owned by such Person or by one or more Wholly Owned Subsidiaries of such Person
or by such Person and one or more Wholly Owned Subsidiaries of such Person.</p>
<p>IN WITNESS WHEREOF, the Company has caused this Certificate of Designation to
be duly executed in its corporate name on this &#160;&#160;&#160;
day of
&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;,
2001.</p>
<table CELLSPACING="0" CELLPADDING="1" WIDTH="590">
  <tr>
    <td WIDTH="42%" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="58%" VALIGN="TOP">
      <p ALIGN="JUSTIFY">COLLINS & AIKMAN PRODUCTS CO.</td>
  </tr>
  <tr>
    <td WIDTH="42%" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="58%" VALIGN="TOP">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="42%" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="58%" VALIGN="TOP">
      <p ALIGN="JUSTIFY">By:<u>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;<br>
      </u>
      &#160;&#160;&#160;&#160;Name:<br>
      &#160;&#160;&#160;&#160;Title:</p>
    </td>
  </tr>
  <tr>
    <td WIDTH="42%" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="58%" VALIGN="TOP">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="42%" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="58%" VALIGN="TOP">
      <p ALIGN="JUSTIFY">By:<u>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;<br>
      </u>
      &#160;&#160;&#160;&#160;Name:<br>
      &#160;&#160;&#160;&#160;Title:</p>
    </td>
  </tr>
  <tr>
    <td WIDTH="42%" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="58%" VALIGN="TOP">&nbsp;</td>
  </tr>
</table>
<b>
<p ALIGN="CENTER">Schedule I</p>
<p ALIGN="CENTER">SCHEDULE OF MODIFICATIONS OF TERMS UPON EXCHANGE FOR<br>
PREFERRED STOCK OF PARENT</p>
<blockquote>
  <blockquote>
    <blockquote>
    </b>
    <p>All payment obligations with respect to the Preferred Stock of Parent
    shall be obligations of Parent and not the Company.</p>
    <p>All obligations to issue additional shares of Redeemable Preferred Stock
    will translate into obligations of Parent to issue corresponding shares of
    Preferred Stock of Parent.</p>
    <p>All rights of holders upon a liquidation, dissolution or
    winding&#45;up of Parent shall relate to Parent and not to the Company.</p>
    <p>Section 4(a) shall no longer be applicable and the Preferred Stock of
    Parent will have no general voting rights with the Common Stock of Parent.</p>
    <p>The voting rights provided for in Section 4(b) will translate into rights
    to elect directors of Parent and not of the Company and all other provisions
    of Section 4 will translate to apply to Parent and not to the Company.</p>
    <p>The provisions of Sections 5, 6, 7(a) through (f), 7(h), 8, 9, 10, 11 and
    12 will translate to apply to Parent and not to the Company, except that
    Section 5(e), clause (vi) of the second paragraph of Section 7(b) and
    clauses (b) and (c) of the third paragraph of Section 7(b) shall no longer
    be applicable.</p>
    <p>All provisions of clause (ii) of Section 7(g) shall translate to apply to
    Parent and not to the Company.</p>
    <p>All financial calculations will be made at the Parent level on a
    consolidated basis, and not at the level of the Company.</p>
    <p>All definitions in Section 13 will be modified consistent with the
    foregoing.</p>
    <p>Other modifications consistent with the intent to issue Preferred Stock
    of Parent similar to the Redeemable Preferred Stock as if Parent had been
    the issuer thereof, in each case reasonably acceptable to Parent and
    Textron.</p>
    <u>
    <p ALIGN="RIGHT">&nbsp;</p>
    </blockquote>
  </blockquote>
</blockquote>
<p ALIGN="RIGHT">EXHIBIT 7</p>
<p ALIGN="CENTER">ASSET PURCHASE AGREEMENT</p>
</u>
<p>ASSET PURCHASE AGREEMENT (the &quot;Agreement&quot;) dated as of August 7,
2001, as amended and restated as of November 30, 2001, between Textron
Automotive Exteriors Inc., a Delaware corporation (&quot;Exteriors&quot;), and
JPS Automotive, Inc., a Delaware corporation (&quot;JPS &quot;). Except as
expressly defined herein, capitalized terms used in this Agreement shall have
the meaning ascribed to them in the Purchase Agreement dated as of August 7,
2001, as amended and restated as of November 30, 2001 (the &quot;Purchase
Agreement&quot;), by and among Textron Inc. (&quot;Parent&quot;), Collins &
Aikman Products Co., a Delaware corporation (&quot;C&A Products&quot;), and
Collins & Aikman Corporation, a Delaware corporation.</p>
<p>WHEREAS, the Purchase Agreement provided for the sale of certain of
Parent&#39;s automotive trim operations currently managed as a unit of
Textron Automotive Company Inc. a Delaware corporation, to C&A Products and
those entities specified in the Purchase Agreement;</p>
<p>WHEREAS, Exteriors desires to sell and assign to JPS, and JPS desires to
purchase and assume from Exteriors, certain assets, Contracts, other obligations
and liabilities relating to the business conducted by Exteriors; and</p>
<p>NOW, THEREFORE, in consideration of the foregoing and the mutual covenants
contained herein and in the Purchase Agreement, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto, intending to be legally bound, agree as follows:</p>
<p>1.&#160;&#160;&#160;&#160;&#160;<u>Sale and Purchase of
Assets</u>. (a)&#160;On the terms and subject to the conditions of this
Agreement, at the Closing, Exteriors shall sell, transfer, assign and deliver to
JPS, or cause to be sold, transferred, assigned and delivered to JPS, free and
clear of any Liens (other than Permitted Liens), and JPS shall purchase and
assume from Exteriors, all of Exteriors&#39; right, title and interest in
and to the Transferred Assets. To the extent that the Transferred Assets consist
of written documents (including microfilms and computer files) which are
necessary to the maintenance of Exteriors&#39; records in accordance with
reasonable practice, Exteriors may either deliver to JPS a duplicate copy of
such documents and retain the original or deliver to JPS the original of such
documents and retain a duplicate copy; <i>provided, however</i>, that Exteriors
shall deliver the original of any such document when delivery of the original is
necessary to effectuate the transfer of any Transferred Asset.</p>
<p>(b)&#160;&#160;&#160;&#160;&#160;For purposes of this
Agreement, &quot;<u>Transferred Assets</u>&quot; shall mean</p>
<p>(A) the Evart, Michigan and Americus, Georgia plants (the &quot;Plants&quot;)
including, the following used primarily at or related primarily to the Plants:</p>
<p>&#160;&#160;&#160;&#160;&#160;(i)&#160;&#160;&#160;&#160;&#160;the
real estate, buildings thereon, fixtures, equipment and other personal property
in the buildings,</p>
<p>&#160;&#160;&#160;&#160;&#160;(ii)&#160;&#160;&#160;&#160;&#160;Contracts,
to the extent their transfer is permitted by their terms, for products produced
at the Plants,</p>
<p>&#160;&#160;&#160;&#160;&#160;(iii)&#160;&#160;&#160;&#160;&#160;to
the extent their transfer is permitted by Law, all Permits relating to the
Plants issued to Exteriors by any Governmental Authority;</p>
<p>&#160;&#160;&#160;&#160;&#160;(iv)&#160;&#160;&#160;&#160;&#160;all
rights in and to products sold (including, without limitation, products
hereafter repossessed or returned and unpaid, Exteriors, rights of replevin,
rescission, reclamation and rights to stoppage in transit) which were
manufactured at the Plants;</p>
<p>&#160;&#160;&#160;&#160;&#160;(v)&#160;&#160;&#160;&#160;&#160;all
rights of way, easements, appurtenances and similar realty interests of
Exteriors pertaining to the real property on which the Plants are located;</p>
<p>&#160;&#160;&#160;&#160;&#160;(vi)&#160;&#160;&#160;&#160;&#160;all
machinery, equipment, furniture, furnishings, vehicles and other fixed assets
used primarily on or relating primarily to the Plants;</p>
<p>&#160;&#160;&#160;&#160;&#160;(vii)&#160;&#160;&#160;&#160;&#160;all
leases of vehicles and of tangible assets which are used primarily at or related
primarily to the Plants;</p>
<p>&#160;&#160;&#160;&#160;&#160;(viii)&#160;&#160;&#160;&#160;&#160;all
inventories of raw materials, work&#45;in&#45;progress, spare parts,
replacement and component parts, office and other supplies and finished goods
for the Plants (the &quot;Inventory&quot;);</p>
<p>&#160;&#160;&#160;&#160;&#160;(ix)&#160;&#160;&#160;&#160;&#160;all
Contracts relating primarily to the Plants to the extent their transfer is
permitted by their terms (the &quot;<u>Purchased Contracts</u>&quot;),
including, without limitation, any right to receive payment for products sold or
services rendered, and to receive goods and services, pursuant to such
agreements;</p>
<p>&#160;&#160;&#160;&#160;&#160;(x)&#160;&#160;&#160;&#160;&#160;all
customer lists relating primarily to the Plants (the &quot;<u>Customer Lists</u>&quot;);</p>
<p>&#160;&#160;&#160;&#160;&#160;(xi)&#160;&#160;&#160;&#160;&#160;all
pre&#45;paid expenses, credits, deferred charges, advance payments, security
deposits and other prepaid items related primarily to the Transferred Assets;</p>
<p>&#160;&#160;&#160;&#160;&#160;(xii)&#160;&#160;&#160;&#160;&#160;all
rights, claims, credits, causes of action or rights of set&#45;off against
third parties related primarily to the Transferred Assets or the Assumed
Liabilities, including, without limitation, unliquidated rights under
manufacturers&#39; and vendors&#39; warranties and rights under
insurance policies covering the Transferred Assets, other than in relation to
liabilities that are the obligations of Exteriors and rights to sue for and
remedies against past, present and future infringements of any Intellectual
Property rights;</p>
<p>&#160;&#160;&#160;&#160;&#160;(xiii)&#160;&#160;&#160;&#160;&#160;all
trade accounts and notes receivable and payments for services as of the Closing
Date which arose from the operation of the Plants in the ordinary course prior
to the Closing Date;</p>
<p>&#160;&#160;&#160;&#160;&#160;(xiv)&#160;&#160;&#160;&#160;&#160;all
books, records, manuals and other materials (in any form or medium), including,
without limitation, all advertising materials, catalogues, price lists,
correspondence, mailing lists, distribution lists, photographs, production data,
sales and promotional materials and records, purchasing materials and records,
personnel records, manufacturing and quality control records and procedures,
blueprints, research and development files, records, data and laboratory books,
media materials and plates, accounting records, customer records, sales order
files and litigation files used primarily in or relating primarily to the
Plants;</p>
<p>&#160;&#160;&#160;&#160;&#160;(xv)&#160;&#160;&#160;&#160;&#160;all
guarantees, warranties, indemnities and similar rights in favor of Exteriors
with respect to any Transferred Asset;</p>
<p>&#160;&#160;&#160;&#160;&#160;(xvi)&#160;&#160;&#160;&#160;&#160;any
and all of the databases, software, source codes, object codes, documentation,
technical data, manuals, comments and instructions, and computer processes used
primarily at or relating primarily to the Plants;</p>
<p>&#160;&#160;&#160;&#160;&#160;(xvii)&#160;&#160;&#160;&#160;&#160;all
goodwill and any other intangible assets related primarily to the Plants,
including without limitation all relationships with brokers and representatives
relating to the sales, marketing, distribution or promotion of products
manufactured in the Plants; and</p>
<p>&#160;&#160;&#160;&#160;&#160;(xviii)&#160;&#160;&#160;&#160;&#160;all
other assets (other than Contracts) which are used primarily at or relate
primarily to the business of such plants; and</p>
<p>(B)&#160;&#160;&#160;&#160;&#160;all assets associated
with the business conducted at Exteriors&#39; leased facility located in St.
Louis Missouri;</p>
<i>
<p>provided</i>, <i>however</i>, that the term Transferred Assets shall not
include any equipment which will be sold by Exteriors pursuant to the
transaction described in Section 5.21 of the Purchase Agreement.</p>
<p>2.&#160;&#160;&#160;&#160;&#160;<u>Purchase Price</u>.
(a) The purchase price for the Transferred Assets shall be eighty four million
seven hundred thirty nine thousand nine hundred seventy one dollars
($84,739,971) minus the estimated amount of Assumed Liabilities which are
treated as liabilities for income tax purposes as of the Closing Date (the
&quot;Purchase Price&quot;). The estimate of said Assumed Liabilities shall be
made by the parties in good faith shortly prior to the closing. JPS shall
deliver to Exteriors at the Closing a promissory note in the principal amount of
the Purchase Price bearing 11% interest compounded annually and payable
quarterly in arrears maturing on the fifth anniversary of the Closing. Such note
shall have terms and provisions as are acceptable to both Exteriors and JPS.</p>
<p>(b)&#160;&#160;&#160;&#160;&#160;Real property, personal
property and other ad valorem Taxes of Exteriors related to the Transferred
Assets shall be allocated between JPS and Exteriors on the basis of a daily
proration and the net amount owing from JPS to Exteriors or from Exteriors to
JPS on account of such proration shall be paid promptly upon written request by
the party entitled to receive such payment. If an assessment for the tax period
that includes the Closing Date (the &quot;<u>Current Period</u>&quot;) has not
been made by the time that payment is due under the preceding sentence, a
tentative payment shall be made at that time based on the assessment for the
immediately preceding tax period, and JPS or Exteriors, as the case may be,
shall make an appropriate adjusting payment within 10 days following receipt of
the assessment for the Current Period.</p>
<p>(c)&#160;&#160;&#160;&#160;&#160;Upon the terms and
subject to the conditions of this Agreement and the Purchase Agreement, at the
Closing JPS shall, by appropriate instruments to be executed and delivered at
Closing, assume and agree to buy, perform and discharge in accordance with the
terms thereof, when due all of the liabilities and obligations related primarily
to the Plants on the Closing Date of whatever kind or nature, absolute or
contingent, known or unknown, whenever arising (the &quot;Assumed
Liabilities&quot;).</p>
<p>(d)&#160;&#160;&#160;&#160;&#160;On terms and subject to
the conditions of this Agreement, the closing of the transactions contemplated
hereby (the &quot;<u>Closing</u>&quot;) shall take place at the offices of
Skadden, Arps, Slate, Meagher & Flom LLP, Four Times Square, New York, New
York at 8:00 a.m. (New York time) as promptly as practicable, but no later than
the second business day following the satisfaction or waiver of the conditions
set forth in Section 3 (other than conditions which by their nature are to be
satisfied at Closing, but subject to those conditions) or at such other time,
date or place as JPS and Exteriors may agree. The date on which the Closing
occurs is hereinafter referred to as the &quot;<u>Closing Date</u>&quot;</p>
<p>3.&#160;&#160;&#160;&#160;&#160;<u>Conditions</u>. The
obligation of each party to complete the purchase of the Plants by JPS are
subject to the satisfaction on or prior to the Closing Date of the conditions
set forth in Section 6.1 of the Purchase Agreement. The obligations of JPS to
complete the purchase of the Plants is subject to the satisfaction on or prior
to the Closing Date of the conditions set forth in Section 6.2 or the Purchase
Agreement. The obligations of Exteriors to complete the sale of the Plants is
subject to the satisfaction on or prior to the Closing Date of the conditions
set forth in Section 6.3 or the Purchase Agreement.</p>
<p>4.&#160;&#160;&#160;&#160;&#160;<u>Rescission</u>. In the
event that the Closing pursuant to the Purchase Agreement does not occur within
two business days after the Closing pursuant to this Agreement, Exteriors and
JPS shall rescind the purchase of the Transferred Assets and the assumption of
the Assumed Liabilities by JPS.</p>
<p>5.&#160;&#160;&#160;&#160;&#160;<u>Termination</u>. This
Agreement may be terminated at any time prior to the Closing by either Exterior
or JPS if the Purchase Agreement has been terminated.</p>
<p>6.&#160;&#160;&#160;&#160;&#160;<u>Miscellaneous</u>.
(a)&#160;This Agreement shall be construed and the rights and duties of the
parties determined in accordance with the laws of the State of Delaware.</p>
<p>(b)&#160;&#160;&#160;&#160;&#160;This Agreement shall
inure to the benefit of and shall be binding upon the parties hereto and their
respective assigns and successors.</p>
<p>(c)&#160;&#160;&#160;&#160;&#160;This Agreement may be
executed in two or more counterparts, each of which shall be deemed an original,
but all of which together shall constitute one and the same<b> </b>instrument.</p>
<p>(d)&#160;&#160;&#160;&#160;&#160;This Agreement may be
amended only by a written agreement signed by JPS and Exteriors.</p>
<p>(e)&#160;&#160;&#160;&#160;&#160;Any notice, request,
instruction or other document to be given hereunder by any party to another
party shall be given in the manner and to the parties specified in the Purchase
Agreement.</p>
<p>(f)&#160;&#160;&#160;&#160;&#160;In case any term,
provision, covenant or restriction of this Agreement is held to be invalid,
illegal or unenforceable in any jurisdiction. the validity, legality and
enforceability of the remaining terms, provisions, covenants or restrictions, or
of such term provision, covenant or restriction in any other jurisdiction, shall
n&#03;&#03;ot in any way be affected or impaired thereby.</p>
<p>(g)&#160;&#160;&#160;&#160;&#160;In the event of any
conflict between this Agreement and the agreements attached as Exhibits 2, 3A,
3B, 3C and 4 to the Purchase Agreement, the latter agreements shall apply.</p>
<p>(h)&#160;&#160;&#160;&#160;&#160;Upon the reasonable
request of JPS, Exteriors shall on and after the Closing Date execute and
deliver to JPS such other documents, releases, assignments and other instruments
as may be required to effectuate completely the transactions contemplated
hereby, and to otherwise carry out the purposes of this Agreement. Upon the
reasonable request of Exteriors, JPS shall on the Closing Date execute and
deliver to Exteriors such other documents, releases, assignments and other
instruments as may be required to effectuate completely the transactions.</p>
<b><u>
<p ALIGN="CENTER">[SIGNATURE PAGE FOLLOWS]</p>
</u></b>
<p>IN WITNESS WHEREOF, the parties hereto have caused this Asset Purchase
Agreement to be executed and delivered as of the date and year first written
above.</p>
<table CELLSPACING="0" CELLPADDING="1" WIDTH="801">
  <tr>
    <td WIDTH="417" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="376" VALIGN="TOP">
      <p ALIGN="JUSTIFY">TEXTRON AUTOMOTIVE EXTERIORS INC.</td>
  </tr>
  <tr>
    <td WIDTH="417" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="376" VALIGN="TOP">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="417" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="376" VALIGN="TOP">
      <p ALIGN="JUSTIFY">By:<u>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;<br>
      </u>
      &#160;&#160;&#160;&#160;Name:<br>
      &#160;&#160;&#160;&#160;Title:</p>
    </td>
  </tr>
</table>
<table CELLSPACING="0" CELLPADDING="1" WIDTH="801">
  <tr>
    <td WIDTH="417" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="376" VALIGN="TOP">
      <p ALIGN="JUSTIFY">JPS AUTOMOTIVE, INC.</td>
  </tr>
  <tr>
    <td WIDTH="417" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="376" VALIGN="TOP">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="417" VALIGN="TOP">&nbsp;</td>
    <td WIDTH="376" VALIGN="TOP">
      <p ALIGN="JUSTIFY">By:<u>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;<br>
      </u>
      &#160;&#160;&#160;&#160;Name:<br>
      &#160;&#160;&#160;&#160;Title:</p>
    </td>
  </tr>
</table>
<p>&nbsp;</p>

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