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<ACCESSION-NUMBER>0001005477-02-001951
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<PERIOD>20020502
<ITEMS>5
<ITEMS>7
<FILING-DATE>20020503
<FILER>
<COMPANY-DATA>
<CONFORMED-NAME>ADVANCED TECHNICAL PRODUCTS INC
<CIK>0000060911
<ASSIGNED-SIC>3460
<IRS-NUMBER>111581582
<STATE-OF-INCORPORATION>DE
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<BUSINESS-ADDRESS>
<STREET1>200 MANSELL COURT EAST
<STREET2>STE 505
<CITY>ROSWELL
<STATE>GA
<ZIP>30076
<PHONE>7709930291
</BUSINESS-ADDRESS>
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<STREET1>200 MANSELL COURT EAST
<STREET2>STE 505
<CITY>ROSWELL
<STATE>GA
<ZIP>30076
</MAIL-ADDRESS>
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<FORMER-CONFORMED-NAME>LUNN LAMINATES INC
<DATE-CHANGED>19780425
</FORMER-COMPANY>
<FORMER-COMPANY>
<FORMER-CONFORMED-NAME>LUNN INDUSTRIES INC /DE/
<DATE-CHANGED>19920703
</FORMER-COMPANY>
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<DOCUMENT>
<TYPE>8-K
<SEQUENCE>1
<FILENAME>d50539_8-k.txt
<DESCRIPTION>FORM 8-K
<TEXT>

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   ----------

                                    FORM 8-K

                                 CURRENT REPORT

                       Pursuant to Section 13 or 15(d) of
                       the Securities Exchange Act of 1934

  Date of Report: (Date of earliest event reported): May 2, 2002 (May 2, 2002)

                        ADVANCED TECHNICAL PRODUCTS, INC.
             (Exact name of registrant as specified in its charter)

        Delaware                       0-1298                    11-1581582
(State of Incorporation)      (Commission File Number)         (IRS Employer
                                                            Identification No.)

                         200 Mansell Ct. East, Suite 505
                             Roswell, Georgia 30076
              (Address of Registrant's principal executive offices)

                                 (770) 993-0291
              (Registrant's telephone number, including area code)

                                (Not Applicable)
          (Former name or former address, if changed since last report)

<PAGE>

ITEM 5. OTHER EVENTS

     On May 2, 2002, Advanced Technical  Products,  Inc. (the "Company") entered
into an  Agreement  and Plan of  Merger  dated as of May 2,  2002  (the  "Merger
Agreement"), with General Dynamics Corporation, a Delaware corporation ("General
Dynamics") and Athena  Acquisition I  Corporation,  a Delaware  corporation  and
wholly owned subsidiary of General Dynamics ("Merger Subsidiary"). The Company's
board of directors  unanimously approved the Merger Agreement and its submission
to stockholders.

     Under the Merger Agreement,  each outstanding share of common stock will be
converted into the right to receive $33.50 in cash, without interest. The Merger
Agreement  provides  for the  merger  of  Merger  Subsidiary  with  and into the
Company, with the Company as the surviving corporation.

     The merger is  conditioned  upon,  among other things:  (i) approval by the
holders   of  the   Company's   common   stock,   (ii)   clearance   under   the
Hart-Scott-Rodino  Antitrust  Improvements  Act of 1976,  as amended,  and (iii)
other customary closing  conditions.  The merger is expected to close by the end
of June of this year.

     Since the board of directors unanimously approved the Merger Agreement, the
provisions  of the  Rights  Agreement  dated as of March 3,  2000,  between  the
Company and American  Stock  Transfer & Trust  Company will not be applicable to
the execution of the Merger Agreement or the closing of the related merger.

     The Merger Agreement and press release are filed as exhibits hereto and are
incorporated  herein by reference.  The description of the Merger  Agreement set
forth above does not purport to be complete  and is qualified in its entirety by
reference to the provisions of the Merger Agreement.

ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS

(c)  Exhibits

     Exhibit 2.1    Agreement  and Plan of  Merger  dated as of May 2, 2002
                    among General  Dynamics  Corporation,  Athena  Acquisition I
                    Corporation and Advanced Technical Products, Inc.

     Exhibit 99.1   Press Release dated May 2, 2002.


                                       2
<PAGE>

                                    SIGNATURE

     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 thereunto duly authorized.

Date: May 2, 2002

                                      ADVANCED TECHNICAL PRODUCTS, INC.


                                      /s/ James P. Hobt
                                      ------------------------------------------
                                      James P. Hobt
                                      Vice President and Chief Financial Officer


                                       3
<PAGE>

                                INDEX OF EXHIBITS

Exhibit Number      Description
--------------      -----------

Exhibit 2.1         Agreement  and Plan of  Merger  dated as of May 2, 2002
                    among General  Dynamics  Corporation,  Athena  Acquisition I
                    Corporation and Advanced Technical Products, Inc.

Exhibit 99.1        Press Release dated May 2, 2002.


                                       4


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-2.1
<SEQUENCE>3
<FILENAME>d50539_ex2-1.txt
<DESCRIPTION>AGREEMENT AND PLAN OF MERGER
<TEXT>

                                                                     Exhibit 2.1

                                                                  Execution Copy

                          AGREEMENT AND PLAN OF MERGER

                             dated as of May 2, 2002

                                      AMONG

                          GENERAL DYNAMICS CORPORATION,

                        ATHENA ACQUISITION I CORPORATION

                                       AND

                        ADVANCED TECHNICAL PRODUCTS, INC.

<PAGE>

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
Description                                                                                                     Page
-----------                                                                                                     ----
<S>                        <C>                                                                                   <C>
ARTICLE 1 THE MERGER..............................................................................................1
      Section 1.1          The Merger.............................................................................1
      Section 1.2          The Closing............................................................................1
      Section 1.3          Effective Time.........................................................................2
      Section 1.4          Effects of the Merger..................................................................2
      Section 1.5          Certificate of  Incorporation and Bylaws...............................................2
      Section 1.6          Directors and Officers.................................................................2
      Section 1.7          Conversion of Company Common Stock.....................................................2
      Section 1.8          Company Options........................................................................4
      Section 1.9          Conversion of Merger Subsidiary Common Stock...........................................4

ARTICLE 2 PAYMENT ................................................................................................4
      Section 2.1          Surrender of Certificates..............................................................4
      Section 2.2          Paying Agent; Certificate Surrender Procedures.........................................5
      Section 2.3          Transfer Books.........................................................................5
      Section 2.4          Termination of Payment Fund............................................................6
      Section 2.5          Lost Certificates......................................................................6
      Section 2.6          No Rights as Stockholder...............................................................6
      Section 2.7          Withholding............................................................................6
      Section 2.8          Further Action.........................................................................7

ARTICLE 3 REPRESENTATIONS AND WARRANTIES OF THE COMPANY...........................................................7
      Section 3.1          Organization...........................................................................7
      Section 3.2          Capitalization.........................................................................7
      Section 3.3          Authorization of Transaction; Enforceability...........................................9
      Section 3.4          Vote Required..........................................................................9
      Section 3.5          Noncontravention; Consents............................................................10
      Section 3.6          Company Filings; Proxy Statement......................................................10
      Section 3.7          No Undisclosed Liabilities............................................................11
      Section 3.8          Absence of Material Adverse Effect....................................................11
      Section 3.9          Litigation and Legal Compliance.......................................................12
      Section 3.10         Contract Matters......................................................................13
      Section 3.11         Tax Matters...........................................................................16
      Section 3.12         Employee Benefit Matters..............................................................20
      Section 3.13         Environmental Matters.................................................................23
      Section 3.14         Properties............................................................................25
      Section 3.15         Intellectual Property Matters.........................................................25
      Section 3.16         Labor Matters.........................................................................26
</TABLE>


                                       ii
<PAGE>

<TABLE>
<S>                        <C>                                                                                   <C>
      Section 3.17         Rights Agreement......................................................................27
      Section 3.18         Insurance Policies....................................................................27
      Section 3.19         Brokers' Fees.........................................................................27
      Section 3.20         Full Disclosure.......................................................................27

ARTICLE 4 REPRESENTATIONS AND WARRANTIES OF THE PARENT AND THE MERGER SUBSIDIARY.................................28
      Section 4.1          Organization..........................................................................28
      Section 4.2          Authorization of Transaction; Enforceability..........................................28
      Section 4.3          Noncontravention; Consents............................................................28
      Section 4.4          Brokers' Fees.........................................................................29
      Section 4.5          No Capital Ownership in the Company...................................................29
      Section 4.6          Adequate Cash Resources...............................................................29

ARTICLE 5 COVENANTS..............................................................................................29
      Section 5.1          General ..............................................................................29
      Section 5.2          Further Assurances....................................................................29
      Section 5.3          Interim Conduct of the Company........................................................30
      Section 5.4          Proxy Statement.......................................................................33
      Section 5.5          Additional Reports....................................................................33
      Section 5.6          Nonsolicitation of Acquisition Proposals..............................................34
      Section 5.7          Indemnification.......................................................................36
      Section 5.8          Public Announcements..................................................................38
      Section 5.9          Full Access...........................................................................39
      Section 5.10         Actions Regarding Antitakeover Statutes...............................................39
      Section 5.11         Employee Benefit Matters..............................................................39
      Section 5.12         Standstill Provisions.................................................................41
      Section 5.13         Notice of Developments................................................................41

ARTICLE 6 CONDITIONS TO THE CONSUMMATION OF THE MERGER...........................................................41
      Section 6.1          Conditions to the Obligations of Each Party...........................................41
      Section 6.2          Conditions to the Obligation of the Company...........................................41
      Section 6.3          Conditions to the Obligation of Parent and the Merger Subsidiary......................42
      Section 6.4          Frustration of Closing Conditions.....................................................43

ARTICLE 7 TERMINATION............................................................................................43
      Section 7.1          Termination...........................................................................43
      Section 7.2          Effect of Termination.................................................................44
      Section 7.3          Termination Fee.......................................................................44
      Section 7.4          Other Termination Fee Matters.........................................................45
</TABLE>


                                      iii
<PAGE>

<TABLE>
<S>                        <C>                                                                                   <C>
ARTICLE 8 MISCELLANEOUS..........................................................................................46
      Section 8.1          Nonsurvival of Representations........................................................46
      Section 8.2          Specific Performance..................................................................46
      Section 8.3          Successors and Assigns................................................................46
      Section 8.4          Amendment.............................................................................46
      Section 8.5          Extension of Time; Waiver.............................................................46
      Section 8.6          Severability..........................................................................46
      Section 8.7          Counterparts..........................................................................46
      Section 8.8          Descriptive Headings..................................................................47
      Section 8.9          Notices ..............................................................................47
      Section 8.10         No Third Party Beneficiaries..........................................................48
      Section 8.11         Entire Agreement......................................................................48
      Section 8.12         Construction..........................................................................48
      Section 8.13         Consent to Jurisdiction...............................................................48
      Section 8.14         Governing Law.........................................................................48
</TABLE>


                                       iv
<PAGE>

                             TABLE OF DEFINED TERMS

Acquisition Agreement                                             Section 5.6
Acquisition Proposal                                              Section 5.6
Affiliate                                                         Section 3.10
Affiliated Group                                                  Section 3.11
Agreement                                                         Preamble
Antitrust Laws                                                    Section 3.5
Certificate                                                       Section 2.1
Certificate of Merger                                             Section 1.3
Closing                                                           Section 1.2
Closing Date                                                      Section 1.2
Code                                                              Section 3.11
Company                                                           Preamble
Company Common Stock                                              Section 1.7
Company Disclosure Letter                                         Article 3
Company Material Adverse Effect                                   Section 3.1
Company Material Agreements                                       Section 3.10
Company Plans                                                     Section 3.12
Company Preferred Stock                                           Section 3.2
Company Representatives                                           Section 5.6
Company SEC Documents                                             Section 3.6
Company Stock                                                     Section 3.2
Company Stock Plans                                               Section 1.8
Company Stockholders Approval                                     Section 3.4
Company Stockholders                                              Section 3.3
Company Stockholders Meeting                                      Section 3.6
Confidentiality Agreement                                         Section 5.9
Constituent Corporations                                          Section 1.1
Deferred Compensation Plan                                        Section 5.11
Delaware Act                                                      Preamble
Dissenting Shares                                                 Section 1.7
Effective Time                                                    Section 1.3
Employee Pension Benefit Plan                                     Section 3.12
Employee Welfare Benefit Plan                                     Section 3.12
Employees                                                         Section 5.11
Environmental Law                                                 Section 3.13
ERISA                                                             Section 3.12
ESPP                                                              Section 5.11
Exchange Act                                                      Section 3.5
GAAP                                                              Section 3.6
Government Contract                                               Section 3.10


                                       v
<PAGE>

Governmental Entity                                               Section 3.5
Hazardous Materials                                               Section 3.13
HSR Act                                                           Section 3.5
Indemnified Parties                                               Section 5.7
Insurance Policies                                                Section 3.18
Intellectual Property                                             Section 3.15
Laws                                                              Section 3.9
Lien                                                              Section 3.2
Merger                                                            Preamble
Merger Consideration                                              Section 1.7
Merger Subsidiary                                                 Preamble
Multiemployer Plan                                                Section 3.12
Negotiation Period                                                Section 5.6
Parent                                                            Preamble
Parent Material Adverse Effect                                    Section 5.2
Paying Agent                                                      Section 2.2
Payment Fund                                                      Section 2.2
Permitted Liens                                                   Section 3.14
PGBC                                                              Section 3.12
Post-Closing Tax Period                                           Section 3.11
Pre-Closing Tax Period                                            Section 3.11
Proxy Statement                                                   Section 3.6
Rights                                                            Section 1.7
Rights Agreement                                                  Section 1.7
SEC                                                               Section 3.6
Securities Act                                                    Section 3.6
Stock Options                                                     Section 1.8
Subsidiary                                                        Section 1.7
Superior Proposal                                                 Section 5.6
Surviving Corporation                                             Section 1.1
Tax Authority                                                     Section 3.11
Tax Returns                                                       Section 3.11
Taxes                                                             Section 3.11
Termination Fee                                                   Section 7.3


                                       vi
<PAGE>

                                                                  Execution Copy

                          AGREEMENT AND PLAN OF MERGER

     AGREEMENT  AND PLAN OF MERGER  dated as of May 2,  2002  (the  "Agreement")
among General  Dynamics  Corporation,  a Delaware  corporation  (the  "Parent"),
Athena  Acquisition  I  Corporation,  a Delaware  corporation  and  wholly-owned
subsidiary  of the Parent (the  "Merger  Subsidiary"),  and  Advanced  Technical
Products, Inc., a Delaware corporation (the "Company").

     WHEREAS,  the  Board  of  Directors  of  each  of the  Parent,  the  Merger
Subsidiary  and the Company deem it advisable and in the best interests of their
respective  companies and  stockholders  to consummate  the merger of the Merger
Subsidiary  with  and into  the  Company,  upon the  terms  and  subject  to the
conditions  set forth herein (the  "Merger"),  and have adopted  resolutions  in
accordance  with  the  General  Corporation  Law of the  State of  Delaware  (as
amended, the "Delaware Act") approving this Agreement,  the Merger and the other
transactions contemplated herein.

     WHEREAS,  pursuant to the Merger, shares of the Company's common stock will
be  converted  into the right to receive  the Merger  Consideration  (as defined
below)  in  the  manner  set  forth  herein,  and  the  Company  will  become  a
wholly-owned subsidiary of the Parent.

     NOW, THEREFORE, in consideration of the mutual agreements contained in this
Agreement, and for other good and valuable consideration, the value, receipt and
sufficiency of which are acknowledged, the parties agree as follows:

                                    ARTICLE 1

                                   THE MERGER

     Section  1.1 The  Merger.  Subject  to the  terms  and  conditions  of this
Agreement,  at the  Effective  Time (as  defined  in  Section  1.3)  the  Merger
Subsidiary  will be merged  with and into the  Company  in  accordance  with the
provisions of the Delaware Act.  Following the Merger, the Company will continue
as the surviving  corporation  (the  "Surviving  Corporation")  and the separate
corporate  existence of the Merger  Subsidiary will cease. The Merger Subsidiary
and the  Company are  sometimes  referred to  collectively  as the  "Constituent
Corporations."

     Section 1.2 The Closing. Unless this Agreement has been terminated pursuant
to Section  7.1,  the closing of the Merger (the  "Closing")  will take place at
10:00 a.m.,  local time,  on a date to be  specified  by the parties  that is no
later  than the  third  business  day  following  satisfaction  or waiver of the
conditions set forth in Article 6 (the "Closing Date"), at the offices of Jenner
& Block, LLC, 601 13th Street N.W., Suite 1200S, Washington, D.C., 20006, unless
another date, time or place is agreed to in writing by the parties.

<PAGE>

     Section  1.3  Effective  Time.  Upon  the  terms  and  conditions  of  this
Agreement,  on the Closing Date (or on such other date as the parties may agree)
the  Company  will  file with the  Delaware  Secretary  of State an  appropriate
certificate  of merger (the  "Certificate  of Merger")  in  accordance  with the
Delaware Act. The Merger will be  consummated  on the later of the date on which
the  Certificate of Merger has been filed with the Delaware  Secretary of State,
or such time as is agreed upon by the parties and specified in such  Certificate
of Merger. The time the Merger becomes effective in accordance with the Delaware
Act is referred to in this Agreement as the "Effective Time."

     Section  1.4  Effects of the  Merger.  The Merger will have the effects set
forth in this  Agreement and Section 259 of the Delaware Act.  Without  limiting
the  generality  of the  foregoing,  as of the  Effective  Time,  the  Surviving
Corporation  will succeed to all the  properties,  rights,  privileges,  powers,
franchises  and  assets  of  the  Constituent   Corporations,   and  all  debts,
liabilities  and  duties of the  Constituent  Corporations  will  become  debts,
liabilities and duties of the Surviving Corporation.

     Section 1.5 Certificate of Incorporation and Bylaws. At the Effective Time,
the  certificate  of  incorporation  and bylaws of the Merger  Subsidiary (as in
effect  immediately prior to the Effective Time), will become the certificate of
incorporation and bylaws of the Surviving  Corporation until thereafter  amended
in accordance with their respective terms and the Delaware Act.

     Section 1.6 Directors  and Officers.  The directors and the officers of the
Merger  Subsidiary  at the  Effective  Time will be the  initial  directors  and
officers of the  Surviving  Corporation  and will hold office from the Effective
Time in  accordance  with the  certificate  of  incorporation  and bylaws of the
Surviving  Corporation  until their  respective  successors  are duly elected or
appointed and qualified.

     Section 1.7 Conversion of Company Common Stock.  As of the Effective  Time,
by virtue of the Merger and without any action on the part of the holders of any
shares of Company Stock (as defined in Section 3.2):

          (a) Each share of the  Company's  common  stock,  par value  $0.01 per
     share (the "Company  Common  Stock"),  issued and  outstanding  immediately
     prior to the Effective Time,  (other than shares of Company Common Stock to
     be canceled  pursuant to (b) below and Dissenting Shares (as defined in (c)
     below))  will,  by virtue of the  Merger,  be  converted  into the right to
     receive,  upon the surrender of the certificate formerly  representing such
     share in accordance with this Agreement,  $33.50 in cash,  without interest
     (the  "Merger  Consideration").  The  Company  Common  Stock  includes  the
     associated rights to purchase Series RP Preferred Stock of the Company (the
     "Rights")  issued  pursuant  to the Rights  Agreement  dated March 3, 2000,
     between  the  Company  and  American  Stock  Transfer & Trust  Company  (as
     amended, the "Rights


                                       2
<PAGE>

     Agreement");  all references herein to the Rights will include all benefits
     that may inure to holders of the Rights  pursuant  to the Rights  Agreement
     and,  unless the  context  otherwise  requires,  all  references  herein to
     Company Common Stock will include the Rights.  All shares of Company Common
     Stock when converted,  will no longer be outstanding and will automatically
     be canceled and retired, and each holder of a certificate  representing any
     such shares will cease to have any rights with respect thereto,  except the
     right to receive such Merger Consideration. In the event that subsequent to
     the date of this Agreement but prior to the Effective Time, the outstanding
     shares of Company  Common  Stock are  changed  into a  different  number of
     shares or a different  class as a result of a stock  split,  reverse  stock
     split,   stock  dividend,   subdivision,   reclassification,   combination,
     exchange, recapitalization or similar transaction, the Merger Consideration
     will be adjusted to reflect such change.

          (b) Each share of Company Common Stock owned  immediately prior to the
     Effective Time by the Company,  the Merger  Subsidiary,  the Parent, or any
     Subsidiary  (as  defined  in (d)  below)  of  the  Parent  or the  Company,
     including without limitation, any such shares held as treasury stock of the
     Company or any Subsidiary of the Company, will, by virtue of the Merger and
     without  any  action on the part of the holder  thereof,  be  canceled  and
     extinguished  without  any  action on the part of the holder  thereof.  For
     purposes of this section, shares of Company Common Stock owned beneficially
     or  held of  record  by any  plan,  program  or  arrangement  sponsored  or
     maintained  for the  benefit  of any  current  or  former  employee  of the
     Company,  the Parent or any of their respective  Subsidiaries,  will not be
     deemed  to be held by the  Company,  the  Parent  or any  such  Subsidiary,
     regardless of whether the Company,  the Parent or any such  Subsidiary  has
     the power,  directly or indirectly,  to vote or control the  disposition of
     such shares.

          (c) Notwithstanding anything in this Agreement to the contrary, shares
     of Company Common Stock outstanding immediately prior to the Effective Time
     and held by a holder who has not voted in favor of the Merger or  consented
     thereto in writing and who has complied with all of the relevant provisions
     of Section 262 of the  Delaware  Act  regarding  appraisal  for such shares
     ("Dissenting  Shares"),  will not be converted  into a right to receive the
     Merger  Consideration,  unless such holder fails to perfect or withdraws or
     otherwise loses their right to appraisal.  The Company will give the Parent
     prompt  written  notice  of any  and  all  demands  for  appraisal  rights,
     withdrawal  of such demands and any other  communications  delivered to the
     Company  pursuant to Section 262 of the Delaware  Act, and the Company will
     give the  Parent  the  opportunity,  to the  extent  permitted  by law,  to
     participate  in all  negotiations  and  proceedings  with  respect  to such
     demands.  Except with the prior written consent of the Parent,  the Company
     will not  voluntarily  make any  payment  with  respect  to any  demand for
     appraisal  rights and will not  settle or offer to settle any such  demand.
     Each holder of Dissenting  Shares who becomes  entitled to payment for such
     Dissenting  Shares under the provisions of Section 262 of the Delaware Act,
     will receive payment thereof from the Surviving Corporation


                                       3
<PAGE>

     and such shares of Company Common Stock will no longer be  outstanding  and
     will automatically be canceled and retired and will cease to exist.

          (d)  The  term  "Subsidiary"  as  used in  this  Agreement  means  any
     corporation,  partnership,  limited  liability  company  or other  business
     entity 50% or more of the outstanding voting equity securities of which are
     owned, directly or indirectly, by the Company or the Parent, as applicable.

     Section 1.8 Stock Options.  The Company will cause each option,  warrant or
other right to purchase shares of Company Common Stock (collectively, the "Stock
Options") under any option plan, program,  agreement or other arrangement of the
Company  or any of its  Subsidiaries,  including  the  2000  Advanced  Technical
Products,  Inc. Stock Option Plan, the 2000 Advanced  Technical  Products,  Inc.
Non-Employee Directors Stock Option Plan, the Advanced Technical Products,  Inc.
Subsidiary Key Management Stock Option Plan (1996),  the 1997 Advanced Technical
Products,  Inc.  Stock Option Plan and the  Advanced  Technical  Products,  Inc.
Non-Employee  Directors  Stock Option Plan  (collectively,  the  "Company  Stock
Plans")  that is  outstanding  and  unexercised,  whether  vested  or  unvested,
immediately prior to the Effective Time, to be canceled as of the Effective Time
and to be converted  at the  Effective  Time into the right to receive,  in full
satisfaction of such Stock Options,  cash from the Company in an amount equal to
the product of (X) the excess, if any, of the Merger  Consideration over the per
share exercise price of such Company Option  immediately  prior to the Effective
Time (subject to adjustment pursuant to the last sentence of Section 1.7(a)) and
(Y) the number of shares of  Company  Common  Stock  issuable  pursuant  to such
Company  Option as of the  Effective  Time (in each case  assuming  such Company
Option had been  fully  vested and fully  exercisable  immediately  prior to the
Effective  Time),  which  cash  payment  will be  made  promptly  following  the
Effective  Time,  and  will be  paid  net of any  applicable  federal  or  state
withholding taxes.

     Section 1.9 Conversion of Merger Subsidiary Common Stock. Each share of the
common stock,  par value $0.01 per share,  of the Merger  Subsidiary  issued and
outstanding  immediately  prior to the  Effective  Time  will,  by virtue of the
Merger and without any action on the part of the holder  thereof,  be  converted
into one validly issued, fully paid and nonassessable share of the common stock,
par value  $0.01 per share,  of the  Surviving  Corporation,  and the  Surviving
Corporation will be a wholly-owned subsidiary of the Parent.

                                    ARTICLE 2

                                     PAYMENT

     Section 2.1 Surrender of  Certificates.  From and after the Effective Time,
each  holder of a  certificate  that  immediately  prior to the  Effective  Time
represented outstanding shares of Company Common Stock (a "Certificate") will be
entitled to receive in exchange  therefor,  upon surrender thereof to the Paying
Agent (as  defined  below),  the Merger  Consideration  into which


                                       4
<PAGE>

the shares of Company Common Stock evidenced by such  Certificate were converted
pursuant to the Merger. No interest will be payable on the Merger  Consideration
to be paid to any holder of a Certificate irrespective of the time at which such
Certificate is surrendered for exchange.

     Section 2.2 Paying Agent; Certificate Surrender Procedures.

               (a) Prior to the Effective  Time, the Parent will designate (with
          the  approval of the Company,  not to be  unreasonably  withheld)  and
          enter into an agreement with an institution or trust company to act as
          paying agent for the Merger  Consideration  (the "Paying  Agent").  As
          soon as reasonably practical after the Effective Time, the Parent will
          deposit with the Paying Agent an amount in cash  sufficient to provide
          all funds necessary for the Paying Agent to make payment of the Merger
          Consideration pursuant to this Agreement (the "Payment Fund"). Pending
          payment of such funds to the holders of Certificates,  such funds will
          be held and may be invested by the Paying Agent as the Parent  directs
          (so long as such  directions  do not  impair  the rights of holders of
          Company  Stock)  in  the  direct  obligations  of the  United  States,
          obligations  for which the full faith and credit of the United  States
          is pledged to provide for the payment of principal  and  interest,  or
          commercial  paper  rated of the highest  quality by Moody's  Investors
          Services,  Inc.  or  Standard  & Poor's  Corporation.  Any net  profit
          resulting  from, or interest or income  produced by, such  investments
          will be payable to the Parent or its  designee,  in the Parent's  sole
          discretion.  The Parent will  promptly  replace any funds lost through
          any investment made pursuant to this section.

               (b) As soon as reasonably  practicable  after the Effective Time,
          the  Parent  will  instruct  the Paying  Agent to mail to each  record
          holder  of a  Certificate  (i) a letter  of  transmittal  (which  will
          specify that delivery will be effected,  and risk of loss and title to
          such  Certificates will pass, only upon delivery of the Certificate to
          the  Paying  Agent  and  will be in such  form  and  have  such  other
          provisions   as  the  Parent  will   reasonably   specify)   and  (ii)
          instructions  for use in effecting the surrender of  Certificates  for
          the Merger  Consideration.  Upon the  surrender to the Paying Agent of
          such  Certificate  or  Certificates  together with a duly executed and
          completed  letter of  transmittal  and all other  documents  and other
          materials  required by the Paying Agent to be delivered in  connection
          therewith,   the  holder  will  be  entitled  to  receive  the  Merger
          Consideration   into  which  the   Certificate  or   Certificates   so
          surrendered  have been converted in accordance  with the provisions of
          this Agreement.  Until so surrendered,  each  outstanding  Certificate
          will be deemed from and after the  Effective  Time,  for all corporate
          purposes,  to evidence  the right to receive the Merger  Consideration
          into which the  shares of Company  Common  Stock  represented  by such
          Certificate  have been converted in accordance  with the provisions of
          this Agreement.

     Section 2.3 Transfer Books. The stock transfer books of the Company will be
closed at the Effective  Time,  and no transfer of any shares of Company  Common
Stock will  thereafter be recorded on any of the stock  transfer  books.  In the
event of a transfer  of  ownership  of any


                                       5
<PAGE>

Company  Common Stock prior to the Effective  Time that is not registered in the
stock  transfer  records  of the  Company  at the  Effective  Time,  the  Merger
Consideration  into which such Company  Common  Stock has been  converted in the
Merger will be paid to the  transferee  in  accordance  with the  provisions  of
Section 2.2(b) only if the Certificate is surrendered as provided in Section 2.2
and  accompanied by all documents  required to evidence and effect such transfer
(including evidence of payment of any applicable stock transfer taxes).

     Section 2.4  Termination  of Payment Fund.  Any portion of the Payment Fund
which remains  undistributed  one hundred  eighty (180) days after the Effective
Time will be  delivered  to the Parent upon  demand,  and each holder of Company
Common Stock who has not previously surrendered  Certificates in accordance with
the  provisions  of this Article 2 will  thereafter  look only to the Parent for
satisfaction  of any claims for the Merger  Consideration  such holder may have.
Notwithstanding the foregoing, neither the Parent, the Merger Subsidiary nor the
Surviving  Corporation  will be liable to any former  holder of  Company  Common
Stock for any  portion  of the  Merger  Consideration  delivered  to any  public
official pursuant to any applicable abandoned property, escheat or similar law.

     Section 2.5 Lost Certificates.  If any Certificate has been lost, stolen or
destroyed,  upon the making of an affidavit (in form and substance acceptable to
the Parent) of that fact by the person making such a claim,  and, if required by
the Parent,  the posting by such person of a bond in such  reasonable  amount as
the Parent may direct as  indemnity  against any claim that may be made  against
with respect to such Certificate,  the Paying Agent will deliver in exchange for
such lost, stolen or destroyed Certificate the Merger Consideration  pursuant to
Section 2.2(b).

     Section 2.6 No Rights as  Stockholder.  From and after the Effective  Time,
the holders of  Certificates  will cease to have any rights as a stockholder  of
the  Surviving  Corporation  except  as  otherwise  expressly  provided  in this
Agreement or by applicable  Laws,  and the Parent will be entitled to treat each
Certificate that has not yet been surrendered for exchange solely as evidence of
the right to receive the Merger  Consideration  into which the shares of Company
Common Stock evidenced by such Certificate  have been converted  pursuant to the
Merger,  provided,  however,  that each holder of a Certificate  that has become
entitled  to any  dividend  declared  but unpaid as of the  Effective  Time will
continue to be entitled to such dividend  following the Effective  Time, and the
Surviving Corporation will pay such dividend to such holder in the amount and on
the date specified therefor by the Board of Directors of the Company at the time
of declaration thereof.

     Section 2.7 Withholding. The Parent will be entitled to deduct and withhold
from the Merger Consideration  otherwise payable to any former holder of Company
Common Stock all amounts  required by law to be deducted or withheld  therefrom.
To  the  extent  that  amounts  are so  withheld  by the  Parent  or the  Merger
Subsidiary,  such  withheld  amounts  will be treated  for all  purposes of this
Agreement  as having  been paid to the holder of the  shares of  Company  Common
Stock in respect of which such deduction and  withholding was made by the Parent
or the Merger Subsidiary.


                                       6
<PAGE>

     Section 2.8 Further  Action.  If, at any time after the Effective Time, any
further action is determined by the Parent to be necessary or desirable to carry
out the purposes of this  Agreement or to vest the  Surviving  Corporation  with
full  right,  title and  possession  of and to all  rights and  property  of the
Constituent   Corporations,   the  officers  and   directors  of  the  Surviving
Corporation and the Parent shall be fully  authorized (in the name of the Merger
Subsidiary, in the name of the Company and otherwise) to take such action.

                                    ARTICLE 3

                  REPRESENTATIONS AND WARRANTIES OF THE COMPANY

     The Company represents and warrants to the Parent and the Merger Subsidiary
that,  except as  disclosed  in (i) the  Company  SEC  Documents  (as defined in
Section  3.6) filed with the SEC (as defined in Section 3.6)  subsequent  to May
13, 2001 but prior to the date  hereof,  or (ii) the letter dated as of the date
of this  Agreement  from the  Company to the  Parent  (the  "Company  Disclosure
Letter"):

     Section 3.1  Organization.  The Company and each of its  Subsidiaries  is a
corporation duly organized, validly existing and in good standing under the laws
of the jurisdiction of its incorporation,  and has all requisite corporate power
and authority to own,  lease and operate its  properties and assets and to carry
on its  business  as  presently  being  conducted.  The  Company and each of its
Subsidiaries  is duly  qualified  or licensed  to conduct  business as a foreign
corporation  in each  jurisdiction  where such  qualification  or  licensing  is
necessary,  except where the failure to be so qualified would not,  individually
or in the aggregate,  reasonably be expected to have a Company  Material Adverse
Effect.   The  term  "Company   Material   Adverse   Effect"  means  any  event,
circumstance, condition, change, development or effect that, either individually
or in the aggregate with all other events, circumstances,  conditions,  changes,
developments or effects,  would have a material  adverse effect on the business,
condition (financial or otherwise),  assets, liabilities,  operations or results
of  operations  of the  Company and its  Subsidiaries  taken as a whole (but not
taking  into  account  any  change or  effect  primarily  caused  by  conditions
affecting the United States economy or securities markets in general as a whole,
or the Company's  industry and not specifically  relating to the Company and its
Subsidiaries),  or the  ability of the Company to  consummate  the Merger and to
perform its obligations  under this Agreement.  The Company has delivered to the
Parent  correct and complete  copies of the  certificate  of  incorporation  and
bylaws currently in effect for the Company and each of its Subsidiaries.

     Section 3.2 Capitalization.

          (a) The authorized capital stock of the Company consists of 30,000,000
     shares of Company Common Stock and 2,000,000 shares of preferred stock, par
     value $1.00 per


                                       7
<PAGE>

     share,  of which 600,000 shares have been designated as Series RP Preferred
     Stock,  (the "Company  Preferred  Stock,"  together with the Company Common
     Stock, the "Company Stock"). As of the close of business on April 30, 2002,
     (i) 5,890,064  shares of Company Common Stock were issued and  outstanding,
     no shares were held by the Company as treasury shares and 1,000,000  shares
     were reserved for issuance  pursuant to the Company  Stock Plans;  and (ii)
     600,000  shares of Company  Preferred  Stock  were  reserved  for  issuance
     pursuant to the Rights  Agreement.  Since  April 30,  2002,  no  additional
     shares of capital  stock have been  issued  except  shares  issued upon the
     exercise of Stock Options issued  pursuant to the Company Stock Plans.  All
     of the issued and  outstanding  shares of capital stock of the Company have
     been duly authorized and are validly issued, fully paid,  nonassessable and
     free of preemptive  rights.  No shares of Company Preferred Stock have been
     issued or are outstanding.

          (b) Other than the Stock  Options to acquire an  aggregate of not more
     than 604,914  shares of Company  Common Stock and the Rights,  there are no
     outstanding or authorized options,  calls,  warrants,  subscription rights,
     convertible  securities,   conversion  rights,  exchange  rights  or  other
     contracts,  agreements or commitments that could require the Company or any
     of its Subsidiaries to issue,  transfer,  sell or otherwise cause to become
     outstanding  any of its  capital  stock.  There  are no  outstanding  stock
     appreciation,  phantom stock,  profit  participation or similar rights with
     respect to the Company or any of its  Subsidiaries or other equity interest
     in the Company or any of its Subsidiaries,  or securities  convertible into
     or exchangeable for such shares or equity interests. As of the date hereof,
     the Company  Disclosure  Letter sets forth a list of all outstanding  Stock
     Options and stock appreciation  rights, as well as the respective  exercise
     prices,  dates of grant and vesting schedules  thereof.  The Company is not
     party to or bound by any  obligation to accelerate the vesting of any Stock
     Options.

          (c) Neither the Company nor any of its  Subsidiaries is a party to any
     voting trust, proxy or other agreement or understanding with respect to the
     voting of any capital stock of the Company or any of its Subsidiaries.

          (d) The  Board  of  Directors  of the  Company  has not  declared  any
     dividend  or  distribution  with  respect to the Company  Common  Stock the
     record or payment date for which is on or after the date of this Agreement.

          (e) All of the  outstanding  shares  of  capital  stock of each of the
     Company's  Subsidiaries  have been duly  authorized and are validly issued,
     fully paid,  nonassessable and free of preemptive  rights, and are owned by
     the  Company  or one of its  Subsidiaries,  free  and  clear of any and all
     liens, encumbrances,  security interests,  charges, pledges or other claims
     ("Liens").  Neither the Company nor any of its  Subsidiaries own or control
     directly or indirectly, or have any direct or indirect equity participation
     in, any corporation,  partnership, limited liability company, joint venture
     or other entity.


                                       8
<PAGE>

          (f) As of the date hereof,  (i) no bonds,  debentures,  notes or other
     indebtedness  of the  Company  having  the  right  to vote  are  issued  or
     outstanding,  and (ii) there are no outstanding  contractual obligations of
     the Company or any of its  Subsidiaries to repurchase,  redeem or otherwise
     acquire  any  shares  of  capital  stock  of  the  Company  or  any  of its
     Subsidiaries.

          (g) The Company Common Stock is traded on the Nasdaq National  Market.
     No other securities of the Company or any of its Subsidiaries are listed or
     quoted for  trading on any United  States  domestic  or foreign  securities
     exchange.

     Section  3.3  Authorization  of  Transaction;  Enforceability.  Subject  to
obtaining the Company  Stockholders  Approval (as defined in Section  3.4),  the
Company  has full  corporate  power and  authority  and has taken all  requisite
corporate  action  to  enable it to  execute  and  deliver  this  Agreement,  to
consummate  the Merger  and the other  transactions  contemplated  hereby and to
perform its  obligations  hereunder.  The Board of  Directors of the Company has
unanimously  adopted  resolutions  approving this Agreement,  the Merger and the
other transactions contemplated hereby,  determining that the foregoing are fair
to, and in the best interests of, the Company and its stockholders (the "Company
Stockholders"),  and recommending that the Company's  Stockholders  approve this
Agreement and the Merger. The foregoing resolutions of the Board of Directors of
the Company have not been modified, supplemented or rescinded and remain in full
force and effect. In connection with its adoption of the foregoing  resolutions,
the Board of Directors of the Company  received the written  opinion of Houlihan
Lokey  Howard & Zukin,  financial  advisor  to the  Board  of  Directors  of the
Company,  to the  effect  that  as of the  date of this  Agreement,  the  Merger
Consideration  is fair to the Company  Stockholders  from a  financial  point of
view. The foregoing opinion has not been modified,  supplemented or rescinded on
or prior to the date of this Agreement.  The Company has delivered to the Parent
correct and complete  copies of the  foregoing  resolutions  and  opinion.  This
Agreement  constitutes the valid and legally binding  obligation of the Company,
enforceable   in   accordance   with  its  terms  and   conditions   (except  as
enforceability   may  be   limited   by   applicable   bankruptcy,   insolvency,
reorganization,  moratorium,  fraudulent  transfer  and similar  laws of general
applicability  relating to or affecting  creditors'  rights or by general equity
principles).  The  action  taken  by the  Board  of  Directors  of  the  Company
constitutes  approval  of the Merger by the Board of  Directors  of the  Company
under the  provisions  of Section  203 of the  Delaware  Act,  and no other fair
price,  moratorium,  control share  acquisition  or other form of state takeover
statute,  rule or regulation is applicable to the Merger or  consummation of the
transactions contemplated hereby.

     Section  3.4  Vote  Required.  The  affirmative  vote of the  holders  of a
majority  of the  outstanding  shares of  Company  Common  Stock  (the  "Company
Stockholders  Approval")  is the only vote of the holders of any class or series
of the  Company's  capital  stock  necessary  to  approve  the  Merger  and  the
consummation of the transactions contemplated hereby.


                                       9
<PAGE>

     Section  3.5  Noncontravention;   Consents.  Except  for  (a)  filings  and
approvals necessary to comply with the applicable requirements of the Securities
Exchange  Act of 1934,  as  amended  (together  with the rules  and  regulations
thereunder,  the  "Exchange  Act") and the "blue  sky" laws and  regulations  of
various  states,  (b)  filings  pursuant  to  the  Hart-Scott-Rodino   Antitrust
Improvements  Act of 1976, as amended (the "HSR Act"),  and any other applicable
competition,  merger control, antitrust or similar laws or regulations set forth
in the Company Disclosure Letter  (collectively with the HSR Act, the "Antitrust
Laws"), (c) approval of the Merger by the Company's  Stockholders and the filing
of the  Certificate  of Merger  pursuant to the  Delaware  Act,  and any similar
certificates  or filings to be made  pursuant to the  corporation  laws of other
jurisdictions in which the Company or any of its Subsidiaries is qualified to do
business,  and (d) any filings  required under the rules and  regulations of The
Nasdaq Stock Market, neither the execution and delivery of this Agreement by the
Company,  nor the consummation by the Company of the  transactions  contemplated
hereby,  will (i) violate or conflict with any provision of the  certificate  of
incorporation or bylaws of the Company or any of its  Subsidiaries,  (ii) result
in a violation or breach of, be in conflict  with, or constitute or create (with
or without  due notice or lapse of time or both) a default  (or give rise to any
right of  termination,  cancellation  or  acceleration)  under any of the terms,
conditions  or  provisions  of any  Company  Material  Agreement  (as defined in
Section 3.10), (iii) violate any order, writ, judgment, injunction, decree, law,
statute,  rule,  order  or  regulation  applicable  to the  Company,  any of its
Subsidiaries  or any of their  properties or assets,  (iv) require any filing or
registration  with,  notification to, or authorization,  consent or approval of,
any government or any agency,  bureau,  board,  commission,  court,  department,
official,  political  subdivision,  tribunal  or  other  instrumentality  of any
government,  whether  federal,  state or  local,  domestic  or  foreign  (each a
"Governmental  Entity") or (v) result in the creation or  imposition of any Lien
on any of the  property  or assets of the  Company  or any of its  Subsidiaries;
except in the case of  clauses  (ii),  (iii)  (iv) and (v) for such  violations,
breaches  or  defaults   that,   or   filings,   registrations,   notifications,
authorizations,  consents or approvals the failure of which to obtain would not,
individually  or in the  aggregate,  reasonably  be  expected  to have a Company
Material Adverse Effect.

     Section 3.6 Company Filings; Proxy Statement.

          (a)  The  Company  has  filed  on  a  timely  basis  all  registration
     statements,  proxy  statements and other  statements,  reports,  schedules,
     forms and other  documents  required  to be filed by the  Company  with the
     Securities and Exchange Commission (the "SEC") since December 31, 1997, and
     all  exhibits  and  amendments  thereto  (collectively,  the  "Company  SEC
     Documents").  Each of the Company SEC Documents,  as of its filing date (or
     if  amended,  as of the  date of its  last  amendment),  complied  with the
     applicable requirements of the Securities Act of 1933, as amended (together
     with the rules and regulations  thereunder,  the "Securities  Act") and the
     Exchange Act (as the case may be), and did not contain any untrue statement
     of a material  fact or omit to state a material  fact required to be stated
     therein or necessary in order to make the statements  therein,  in light of
     the circumstances under which they were made, not misleading. No Subsidiary
     of the


                                       10
<PAGE>

     Company is required to file any statements,  reports,  schedules,  forms or
     other documents pursuant to the Securities Act or the Exchange Act.

          (b) Each of the  consolidated  balance sheets  included in the Company
     SEC Documents  fairly  presents in all material  respects the  consolidated
     financial position of the Company and its Subsidiaries as of the respective
     dates  thereof,  and the other related  consolidated  financial  statements
     (including  related notes) included  therein fairly present in all material
     respects  the results of  operations  and cash flows of the Company and its
     Subsidiaries  for the respective  periods or as of the respective dates set
     forth therein.  Each of the consolidated  financial  statements  (including
     related  notes)  included  in the  Company  SEC  Documents  comply with the
     applicable accounting  requirements and the published rules and regulations
     of the SEC with respect  thereto,  and has been prepared in accordance with
     accounting  principles  generally  accepted in the United  States  ("GAAP")
     applied on a consistent  basis  during the periods or as of the  respective
     dates involved,  except as otherwise noted therein and subject, in the case
     of unaudited interim financial statements,  to normal year-end adjustments.
     There  are no  material  off-balance  sheet  assets or  liabilities  of the
     Company or any of its  Subsidiaries  except as disclosed in the Company SEC
     Documents.

          (c)  The  definitive   proxy   statement   materials  (as  amended  or
     supplemented,   the  "Proxy   Statement")  to  be  sent  to  the  Company's
     Stockholders in connection with the meeting of the stockholders to consider
     the Merger (the "Company  Stockholders  Meeting") will not, on the date the
     Proxy  Statement  is first mailed to the  Stockholders,  at the time of the
     Company  Stockholders  Meeting or at the Effective Time, contain any untrue
     statement of a material fact or omit to state any material fact required to
     be stated therein or necessary in order to make the statements  therein, in
     light  of the  circumstances  under  which  they  are  made,  not  false or
     misleading.  The Proxy Statement will comply in all material  respects with
     the applicable provisions of the Exchange Act.

     Section 3.7 No Undisclosed Liabilities.  Neither the Company nor any of its
Subsidiaries  has any liabilities or obligations  (whether accrued or unaccrued,
absolute or  contingent,  liquidated or  unliquidated,  or due or to become due)
except for (a)  liabilities  and  obligations  referenced  (whether  by value or
otherwise)  or  reflected  in the Company SEC  Documents,  (b)  liabilities  and
obligations  incurred in the ordinary  course of business,  consistent with past
practice,  since December 31, 2001, and (c) other  liabilities  and  obligations
which would not,  individually  or in the  aggregate,  reasonably be expected to
have a Company Material Adverse Effect.

     Section 3.8 Absence of Material  Adverse  Effect.  Since December 31, 2001,
there has not been: (i) a Company Material Adverse Effect,  nor does there exist
or has there occurred any event, change, circumstance, condition, development or
effect which would, individually or in the aggregate,  reasonably be expected to
have a Company Material Adverse Effect;  (ii) any declaration,  setting aside or
payment of any  dividend  or other  distribution  (whether  in cash,


                                       11
<PAGE>

stock,  or property)  with respect to any capital stock of the Company or any of
its Subsidiaries or any purchase,  redemption or other  acquisition for value by
the Company or any of its  Subsidiaries  of any capital  stock of the Company or
any of its  Subsidiaries  except in the ordinary course of business,  consistent
with past  practice;  (iii) any split,  combination or  reclassification  of any
capital stock of the Company or any of its  Subsidiaries  or any issuance or the
authorization  of any issuance of any other securities in respect of, in lieu of
or in  substitution  for  shares of capital  stock of the  Company or any of its
Subsidiaries; (iv) (A) any granting by the Company or any of its Subsidiaries to
any director or executive  officer of the Company or any of its  Subsidiaries of
any  increase  in  compensation,  except  in the  ordinary  course  of  business
consistent with prior practice or as was required under employment  agreement in
effect as of December  31,  2001,  (B) any granting by the Company or any of its
Subsidiaries  to any such  director  or  executive  officer of any  increase  in
severance  or  termination  pay,  except as was required  under any  employment,
severance or termination agreement in effect as of December 31, 2001, or (C) any
entry by the Company or any of its Subsidiaries  into any employment,  severance
or termination  agreement with any such director or executive  officer;  (v) any
change in accounting  methods,  principles or practices by the Company or any of
its  Subsidiaries  materially  affecting the assets,  liabilities  or results of
operations  of the Company or any of its  Subsidiaries,  other than such changes
required  by GAAP;  or (vi) any  material  elections  with  respect to Taxes (as
defined  below) by the  Company  or any of its  Subsidiaries  (other  than those
elections  reflected  on Tax  Returns (as  defined  below)  filed as of the date
hereof) or settlement or compromise by the Company or any of its Subsidiaries of
any material Tax liability or refund.

     Section 3.9 Litigation and Legal Compliance.

          (a) As of the  date  hereof,  there  are no  claims,  actions,  suits,
     proceedings  or  investigations  pending  or to  the  Company's  knowledge,
     threatened  by or  against  the  Company or any of its  Subsidiaries  which
     would,  individually or in the aggregate,  reasonably be expected to have a
     Company  Material  Adverse  Effect.  Neither  the  Company  nor  any of its
     Subsidiaries is subject to any outstanding judgment,  injunction,  order or
     decree of any  Governmental  Entity  which  would,  individually  or in the
     aggregate,  reasonably  be  expected  to have a  Company  Material  Adverse
     Effect.  There are no judicial or  administrative  actions,  proceedings or
     investigations  pending,  or to the Company's  knowledge,  threatened  that
     question the validity of this  Agreement or any action taken or to be taken
     by the Company in connection with this Agreement.

          (b) Except for instances of noncompliance that would not, individually
     or in the  aggregate,  reasonably  be expected  to have a Company  Material
     Adverse  Effect,  the Company and its  Subsidiaries  are in compliance with
     each federal,  state,  local and foreign law,  statute,  rule,  regulation,
     ordinance,   permit,   order,   writ,   injunction,   judgment   or  decree
     (collectively "Laws") to which the Company, any of its Subsidiaries, or any
     of their  respective  assets or properties may be subject.  The Company and
     its  Subsidiaries   have  all  material   permits,   licenses,   approvals,
     authorizations of and  registrations  with and


                                       12
<PAGE>

     under all Laws, and from all Governmental Entities, required by the Company
     and its Subsidiaries to carry on their  respective  businesses as currently
     conducted. Neither the Company nor any of its Subsidiaries nor any of their
     respective directors,  officers, agents or employees (i) used any corporate
     or other funds for unlawful  contributions,  gifts,  entertainment or other
     unlawful expenses relating to political activity, (ii) made or accepted any
     unlawful payment to foreign or domestic  government  officials or employees
     or to foreign or domestic  political  parties or  campaigns or violated any
     provision of the Foreign  Corrupt  Practices  Act of 1977,  as amended,  or
     (iii)  made  or  accepted  any  other   unlawful   payment,   contribution,
     expenditure or gift.

     Section 3.10 Contract Matters.

          (a) The Company has provided the Parent with true and accurate  copies
     of each of the  following  that are in effect or  otherwise  binding on the
     Company or any of its Subsidiaries or their respective properties or assets
     (collectively,   the  "Company  Material   Agreements"):   (i)  any  credit
     agreement,  note, bond,  guarantee,  mortgage,  indenture,  lease, or other
     instrument or obligation  pursuant to which any  "indebtedness" (as defined
     below) of the Company or any of its  Subsidiaries  is outstanding or may be
     incurred;  (ii) any  agreement,  contract or binding  commitment  which has
     been,  or was  required  to be,  filed as an  exhibit  to the  Company  SEC
     Documents;   and  (iii)  any  (A)  collective  bargaining  agreement;   (B)
     employment  or  consulting   agreement,   contract  or  binding  commitment
     providing for compensation or payments in excess of $100,000 in the current
     or  any  future   year;   (C)   agreement,   contract  or   commitment   of
     indemnification  or guaranty  not entered  into in the  ordinary  course of
     business providing for  indemnification  which would reasonably be expected
     to exceed  $50,000,  as well as any  agreement,  contract or  commitment of
     indemnification  or guaranty between the Company or any of its Subsidiaries
     and any of their  respective  officers or  directors,  irrespective  of the
     amount;  (D)  agreement,  contract  or binding  commitment  containing  any
     covenant directly or indirectly  limiting the freedom of the Company or any
     of its  Subsidiaries  to engage in any line of  business,  compete with any
     person,  or sell any product,  or which,  following the consummation of the
     Merger,  would  so limit  the  Parent  or the  Surviving  Corporation;  (E)
     agreement,  contract or binding  commitment that will result in the payment
     by,  or  the  creation  of  any  commitment  or  obligation   (absolute  or
     contingent) to pay on behalf of the Company or any of its  Subsidiaries any
     severance,  termination,  "golden  parachute," or other similar payments to
     any employee  following  termination of employment or otherwise as a result
     of the consummation of the transactions contemplated by this Agreement; (F)
     agreement,  contract  or binding  commitment  by the  Company or any of its
     Subsidiaries  relating to the disposition or acquisition of material assets
     not in the  ordinary  course of business or any  ownership  interest in any
     corporation,  partnership,  joint venture or other business enterprise; (G)
     other agreement,  contract or binding  commitment which involves payment by
     the  Company or any of its  Subsidiaries  of $500,000 or more in any twelve
     (12)  month  period,  or  $1,000,000  in the  aggregate  and  which  is not
     terminable  on thirty  (30) days  notice  without  liability;  or (H) other


                                       13
<PAGE>

     agreement,  contract  or  binding  commitment  which  is  material  to  the
     operation,  or which is outside the ordinary  course,  of the Company's and
     its Subsidiaries'  businesses.  The numerical  thresholds set forth in this
     section shall not be deemed in any respect to define  materiality for other
     purposes  of this  Agreement.  The Company  Disclosure  Letter sets forth a
     complete and accurate list of the Company Material Agreements. For purposes
     of this  section,  "indebtedness"  shall mean,  with respect to any person,
     without duplication, (1) all obligations of such person for borrowed money,
     (2) all  obligations  of others  secured by any Lien on  property or assets
     owned or acquired by such person,  whether or not the  obligations  secured
     thereby have been assumed, (3) all letters of credit issued for the account
     of such  person  (excluding  letters of credit  issued  for the  benefit of
     suppliers to support accounts payable to suppliers incurred in the ordinary
     course of business) and (4) all  obligations,  the  principal  component of
     which are obligations under leases that are, or should be pursuant to GAAP,
     classified as capital leases.

          (b) Neither the Company nor any of its Subsidiaries  has breached,  is
     in  default  under,  or has  received  written  notice of any  breach of or
     default under (or, would be in default,  breach or violation with notice or
     lapse of time, or both),  any Company  Material  Agreement,  except for any
     such breach or default,  that would not,  individually or in the aggregate,
     reasonably be expected to have a Company  Material  Adverse Effect.  To the
     knowledge  of the  Company,  no other party to any of the Company  Material
     Agreements  has  breached  or is in  default  of  any  of  its  obligations
     thereunder.  Each of the Company  Material  Agreements is in full force and
     effect,  and  will  continue  to be in  full  force  and  effect  following
     consummation of the transactions  contemplated  hereby,  except in any such
     case for breaches,  defaults or failures that would not, individually or in
     the aggregate,  reasonably be expected to have a Company  Material  Adverse
     Effect. Each of the Company Material  Agreements  constitutes the valid and
     legally  binding  obligation of the Company or the  appropriate  Subsidiary
     that is a  party  thereto  (except  as  enforceability  may be  limited  by
     applicable bankruptcy, insolvency,  reorganization,  moratorium, fraudulent
     transfer and similar laws of general applicability relating to or affecting
     creditors' rights or by general equity principles). Neither the Company nor
     any  of  its   Subsidiaries   has  received  any  notice  of   termination,
     cancellation or non-renewal with respect to any Company Material Agreement,
     and to the  Company's  knowledge,  no  other  party to a  Company  Material
     Agreement plans to terminate, cancel or not renew any such agreement.

          (c) With respect to each contract,  agreement, bid or proposal between
     the Company or any of its  Subsidiaries  and any (i)  Governmental  Entity,
     including  any  facilities   contract  for  the  use  of   government-owned
     facilities  or (ii) third party  relating to a contract  between such third
     party and any domestic or foreign government or governmental agency (each a
     "Government  Contract"),  (A) the Company and each of its Subsidiaries have
     complied in all material  respects  with all terms and  conditions  of such
     Government  Contract,  including all clauses,  provisions and  requirements
     incorporated  expressly by reference,  or by operation of law therein,  (B)
     the  Company and each of its


                                       14
<PAGE>

     Subsidiaries  have complied in all material  respects with all requirements
     of  all  Laws,  or  agreements  pertaining  to  such  Government  Contract,
     including  where  applicable  the "Cost  Accounting  Standards"  disclosure
     statement of the Company or such Subsidiary,  (C) all  representations  and
     certifications executed, acknowledged or set forth in or pertaining to such
     Government  Contract were complete and correct as of their  effective dates
     and  the  Company  and  its  Subsidiaries   have  complied  with  all  such
     representations   and   certifications,   (D)  neither  the  United  States
     government  nor any  prime  contractor,  subcontractor  or other  person or
     entity has notified the Company or any of its  Subsidiaries,  in writing or
     orally,  that  the  Company  or any of its  Subsidiaries  has  breached  or
     violated  any Law,  certification,  representation,  clause,  provision  or
     requirement pertaining to such Government Contract, (E) neither the Company
     nor any of its  Subsidiaries  has  received any notice of  termination  for
     convenience,  notice of termination for default,  cure notice or show cause
     notice  pertaining  to such  Government  Contract,  (F)  other  than in the
     ordinary course of business,  no cost incurred by the Company or any of its
     Subsidiaries  pertaining to such Government Contract has been questioned or
     challenged,  is the  subject  of any  audit  or  investigation  or has been
     disallowed  by any  Governmental  Entity,  and (G) no  payments  due to the
     Company or any of its Subsidiaries  pertaining to such Government  Contract
     have been  withheld or set off,  nor has any claim been made to withhold or
     set off money,  and the Company and its  Subsidiaries  are  entitled to all
     progress or other payments  received with respect  thereto,  except for any
     such failure,  noncompliance,  inaccuracy, breach, violation,  termination,
     cost,  investigation,  disallowance or payment that would not, individually
     or in the  aggregate,  reasonably  be expected  to have a Company  Material
     Adverse Effect.

          (d) To the  Company's  knowledge,  neither  the Company nor any of its
     Subsidiaries or any of their  respective  directors,  officers,  employees,
     consultants  or agents is or since  December  31,  1997 has been  under any
     administrative, civil or criminal investigation, indictment or audit by any
     Governmental  Entity or under  investigation  by the  Company or any of its
     Subsidiaries  with respect to any alleged  improper act or omission arising
     under or relating to any Government Contract.

          (e) There exist (i) no material outstanding claims against the Company
     or any of its  Subsidiaries,  either by any  Governmental  Entity or by any
     prime contractor,  subcontractor, vendor or other person or entity, arising
     under or relating to any Government Contract, and (ii) no material disputes
     between  the  Company  or any of its  Subsidiaries  and the  United  States
     government  under the  Contract  Disputes  Act,  as  amended,  or any other
     federal statute,  or between the Company or any of its Subsidiaries and any
     prime contractor,  subcontractor or vendor arising under or relating to any
     Government  Contract.  Neither the Company nor any of its  Subsidiaries has
     (i) any  interest  in any  pending  claim  against  any  prime  contractor,
     subcontractor  or  vendor  arising  under  or  relating  to any  Government
     Contract,  which,  if  adversely  determined  against  the  Company  would,
     individually or in the aggregate,  reasonably be expected to


                                       15
<PAGE>

     have a Company Material Adverse Effect, or (ii) any interest in any pending
     or potential material claim against any Governmental Entity.

          (f) Since  December  31,  1997,  neither  the  Company  nor any of its
     Subsidiaries has been debarred or suspended from participation in the award
     of contracts  with the United States  government or any other  Governmental
     Entity  (excluding  for  this  purpose  ineligibility  to  bid  on  certain
     contracts  due  to  generally  applicable  bidding  requirements).  To  the
     Company's  knowledge,  there  exist no facts or  circumstances  that  would
     warrant the  institution  of  suspension  or debarment  proceedings  or the
     finding of  nonresponsibility  or ineligibility on the part of the Company,
     any of its Subsidiaries or any of their respective  directors,  officers or
     employees.  No payment  has been made by or on behalf of the Company or any
     of its Subsidiaries in connection with any Government Contract in violation
     of applicable  procurement  laws, rules and regulations or in violation of,
     or requiring  disclosure  pursuant to, the Foreign Corrupt Practices Act of
     1977, as amended.

          (g) Neither the  Company nor any of its  Subsidiaries  is (or has been
     since  December  31,  2001)  a  party  to a  material  transaction  with an
     Affiliate (as defined below), nor are there any commitments to do so in the
     future.  The assets of the Company and its  Subsidiaries do not include any
     receivable or other  obligation or  commitment  from an Affiliate,  and the
     liabilities of the Company and its  Subsidiaries do not include any payable
     or other obligation or commitment to any Affiliate. No Affiliate is a party
     to any contract  with any customer or supplier of the Company or any of its
     Subsidiaries,  except  that  with  respect  to  any  Affiliate  that  is an
     Affiliate  solely  based  on its  ownership  of 5% or  more  of the  voting
     securities of the Company,  such representation is made to the knowledge of
     the Company.  For purposes of this  Agreement,  "Affiliate"  shall mean any
     individual,  corporation,  partnership,  limited liability  company,  joint
     venture, association, unincorporated organization, or other entity that (i)
     owns 5% or more  of the  voting  securities  of the  Company  or any of its
     Subsidiaries,  (ii) is a  director,  executive  or officer  employed by the
     Company  or  any of its  Subsidiaries,  or  (iii)  directly  or  indirectly
     controls,  is controlled by or is under common  control with the Company or
     any of its Subsidiaries.

     Section 3.11 Tax Matters.

          (a) (i) The Company and each of its Subsidiaries have timely filed all
     required returns,  declarations,  reports,  claims for refund,  information
     returns or other documents (including any related or supporting  schedules,
     statements or information)  (collectively,  "Tax Returns")  relating to any
     federal,  state,  local  or  foreign  income,  gross  receipts,  franchise,
     estimated,  alternative  minimum,  add-on minimum,  sales,  use,  transfer,
     registration,  value added, excise,  natural resources,  severance,  stamp,
     occupation, premium, windfall profit, environmental,  customs, duties, real
     property, personal property, capital stock, social security,  unemployment,
     disability,  payroll, license, employee or other withholding, or other tax,
     of any kind whatsoever,  including any


                                       16
<PAGE>

     interest, penalties or additions to tax or additional amounts in respect to
     the foregoing,  including any  transferee or secondary  liability for a tax
     and any  liability  assumed by agreement or arising as a result of being or
     ceasing  to be a member  of any  affiliated  group,  or being  included  or
     required to be included in any Tax Return  relating  thereto  (collectively
     "Taxes"), and all such Tax Returns are correct and complete in all material
     respects.  As of the time of filing,  the foregoing  Tax Returns  correctly
     reflected the facts  regarding the income,  business,  assets,  operations,
     activities,  status,  or  other  matters  of  the  Company  and  any of its
     Subsidiaries,  or any other information required to be shown thereon;  (ii)
     the foregoing  Tax Returns are not subject to penalties  under Section 6662
     of the Internal  Revenue Code of 1986, as amended  (together with the rules
     and  regulation  thereunder,  the  "Code"),  relating  to  accuracy-related
     penalties (or any  corresponding  provision of the state,  local or foreign
     Tax law) or any  predecessor  provision of Law;  (iii) an extension of time
     within  which to file any Tax Return that has not been filed,  requested or
     granted;  (iv) no  material  claim has been made  within  the past five (5)
     years or, to the Company's  knowledge,  is expected to be made by any U.S.,
     foreign,  state  or  local  governmental  authority  having  the  power  to
     regulate, impose or collect Taxes ("Tax Authority") in a jurisdiction where
     the Company or any of its Subsidiaries does not file Tax Returns that it is
     or may be subject to taxation by that jurisdiction;  (v) there are no liens
     for Taxes  other  than for  current  Taxes not yet due and  payable  on the
     assets of the Company or any of its Subsidiaries; (vi) the Company and each
     of its Subsidiaries have withheld, deducted or collected all Taxes required
     to have been  withheld,  deducted or collected in  connection  with amounts
     paid  or  owing  to  any  employee,   independent   contractor,   creditor,
     stockholder or other party,  and, to the extent required,  all such amounts
     have been paid to the proper Tax Authority or other  person;  and (vii) the
     Company  or any  of  its  Subsidiaries  have  not  waived  any  statute  of
     limitations  in  respect of Taxes or agreed to any  extension  of time with
     respect to a Tax assessment or deficiency.

          (b) The Company and each of its  Subsidiaries  have  complied with all
     applicable  Tax  Laws  and  agreements   (including  under  Tax  allocation
     agreements),  and all amounts  required to be paid by the Company or any of
     its  Subsidiaries to Tax Authorities or others have been paid or adequately
     reserved for in  accordance  with GAAP in the  financial  statements of the
     Company.

          (c) The unpaid Taxes of the Company or any of its  Subsidiaries  as of
     the most recent financial  statement contained in the Company SEC Documents
     (i) did not exceed the accrued Tax  liability  (rather than any reserve for
     deferred  Taxes  established  to reflect  differences  between book and Tax
     income) set forth  either on the face of the Company  consolidated  balance
     sheet,  or in the notes thereto;  and (ii) will not exceed that accrued Tax
     liability as adjusted for operations and  transactions  through the Closing
     Date in accordance  with the past practice of the Company in filing its Tax
     Returns or in preparing its consolidated financial statements.


                                       17
<PAGE>

          (d) The  Company  does not  expect  any Tax  Authority  to assess  any
     additional  Tax  against  the  Company or any of its  Subsidiaries  for any
     period for which Tax Returns have been filed.  There is no dispute or claim
     concerning  any Tax  liability  of the  Company or any of its  Subsidiaries
     either  claimed  or  raised  by any Tax  Authority  in  writing,  or to the
     knowledge  of the  Company,  based upon  personal  contact of any  officer,
     employee or agent of the Company with any agent of such Tax Authority.  The
     Company  Disclosure  Letter sets forth (i) the taxable years of the Company
     or  any  of  its  Subsidiaries  as to  which  the  respective  statutes  of
     limitations  with  respect  to Taxes  has not yet  expired;  and (ii)  with
     respect to such taxable years,  those years for which (A) examinations have
     been  completed;  (B)  examinations  are  presently  being  conducted;  (C)
     examinations have not been initiated; and (D) required Tax Returns have not
     yet been filed. All  deficiencies  asserted or assessments made as a result
     of any examinations have been fully paid or otherwise discharged.

          (e) Neither the Company nor any of its  Subsidiaries has any liability
     for the Taxes of any other person  (other than the Company or a Subsidiary)
     under the provisions of Treasury  Regulation  Section  1.1502-6 (or similar
     provisions of state, local or foreign Tax law) as a transferee or successor
     by contract or otherwise.

          (f) The Company  Disclosure  Letter sets forth the net operating  loss
     carryovers and any Tax attribute  carryovers of the Company  (including net
     capital losses, excess foreign tax credits, excess general business credits
     and alternative minimum tax payments) as of the date hereof.  Except as may
     result from the Merger,  there are no limitations pursuant to Sections 382,
     383 or 384 of the  Code or the  SRLY  limitations  of  Treasury  Regulation
     Sections  1.1502-21  or 1.1502-22 on the ability of the Company to use such
     carryovers.

          (g) The Company (i) does not have any excess loss  account (as defined
     in Treasury  Regulation Section 1.1502-19) with respect to the stock of any
     Subsidiary;  and (ii) is not  required  to include in taxable  income for a
     taxable  period or portion of period  ending on or after the  Closing  Date
     ("Post-Closing  Tax  Period")  any  item of  income  or gain  reported  for
     financial  purposes  in any tax period or  portion  of period  ending on or
     before the Closing Date ("Pre-Closing Tax Period").

          (h) (i) Neither the Company nor any affiliated  group of  corporations
     within the meaning of Section 1504(a) of the Code  ("Affiliated  Group") in
     which the  Company is or was a member has filed a consent  pursuant  to the
     collapsible  corporation  provision  of Section  341(f) of the Code (or any
     corresponding  provision  of state,  local,  or foreign  income Tax law) or
     agreed  to  have  Section  341(f)(2)  of the  Code  (or  any  corresponding
     provision  of  state,  local,  or  foreign  income  Tax  law)  apply to any
     disposition  of any asset owned by the Company;  (ii) none of the assets of
     the  Company is  property  that the  Company is  required to treat as being
     owned by any other person pursuant to the "safe harbor lease" provisions of
     former  Section  168(f)(8)  of the Code;  (iii)  none of the  assets


                                       18
<PAGE>

     of the  Company  are  required  to be or are  being  depreciated  under the
     alternative  depreciation  system under Section 168(g)(2) of the Code; (iv)
     none of the assets of the Company are "tax-exempt use property"  within the
     meaning of Section  168(h) of the Code;  (v) the  Company  has not made and
     will not make a consent  dividend  election  under Section 565 of the Code;
     (vi) the  Company  has not  agreed to make nor is it  required  to make any
     adjustment  under  Section  481(a)  of the Code by  reason  of a change  in
     accounting method or otherwise;  (vii) the Company has not been a member of
     an  Affiliated  Group  that has filed an  election  to  discontinue  filing
     consolidated  returns  pursuant to Rev.  Proc.  91-11;  (viii)  neither the
     Company nor any of its  Subsidiaries  has made or is bound by any  election
     under  Section  197  of  the  Code;  and  (ix)  the  Company  or any of its
     Subsidiaries are not a party to any agreement,  contract,  arrangement,  or
     plan that has resulted or would result,  separately or in the aggregate, in
     the  payment of any  "excess  parachute  payments"  within  the  meaning of
     Section  280G of the Code,  or any  payment  that  would  otherwise  not be
     deductible  or that  provides for any  gross-up  payments in the event that
     Section 280G of the Code applies.

          (i) The Company does not have or has not had any disqualified interest
     expense within the meaning of Section 163(j) of the Code.

          (j) Neither the Company nor any Affiliated  Group of which the Company
     is or has been a member has participated in an international boycott within
     the meaning of Section 999 of the Code.

          (k) The Company has made  available to the Parent correct and complete
     copies of all Tax Returns  filed by the Company or any of its  Subsidiaries
     or by any other entity on behalf of the Company or any of its  Subsidiaries
     for all taxable periods beginning on or after January 1, 1997.

          (l) Neither the Company nor any of its  Subsidiaries is a party to any
     Tax  indemnity,  Tax  sharing,  Tax  allocation  or  similar  agreement  or
     arrangement.  Any  liability  or  obligation  of the  Company or any of its
     Subsidiaries  to any third party under such agreements will terminate as of
     the  Closing  Date and be of no  further  force  or  effect.  Any  payments
     pursuant  to such  agreements  that were not  reflected  in the most recent
     financial  statements  contained in the Company SEC Documents are set forth
     in the Company Disclosure Letter.

          (m) No amount payable by either the Company or any of its Subsidiaries
     will be subject to disallowance under Section 162(m) of the Code.

          (n) There are no outstanding rulings of, or requests for rulings with,
     any  Tax  Authority  expressly  addressed  to  the  Company  or  any of its
     Subsidiaries  that are, or if issued would be,  binding upon the Company or
     any of its Subsidiaries for any Post-Closing Tax Period.


                                       19
<PAGE>

          (o) Neither the Company nor any of its  Subsidiaries is a party to any
     joint venture,  partnership, or other arrangement or contract that could be
     treated as a partnership for federal income tax purposes.

          (p) The Company  does not have any Code  Section 367 gain  recognition
     agreements.

          (q) The Company is not a foreign-owned  corporation within the meaning
     of Section 6038A(c) of the Code.

          (r) Neither the Company nor any of its Subsidiaries has engaged in any
     "reportable   transaction,"  including  but  not  limited  to  any  "listed
     transaction,"  within the meaning of Section  6011 of the Code or any other
     applicable  federal law including  but not limited to any Internal  Revenue
     Service ruling, procedure, notice or other pronouncement.

     Section 3.12 Employee Benefit Matters.

          (a) The Company  Disclosure  Letter  lists each plan,  fund,  program,
     policy,  contract or  commitment,  whether  qualified or not  qualified for
     federal income tax purposes, whether for the benefit of a single individual
     or  more  than  one  individual  whether  or not  subject  to the  Employee
     Retirement Income Security Act of 1974, as amended (together with the rules
     and regulations thereunder,  "ERISA"), whether written or oral which is (i)
     an  employee  pension  benefit  plan as defined  in  Section  3(2) of ERISA
     ("Employee Pension Benefit Plan"), (ii) an employee welfare benefit plan as
     defined in Section 3(1) of ERISA ("Employee Welfare Benefit Plan") or (iii)
     an incentive,  voluntary employees'  beneficiary  association as defined in
     Section  501(c)(9) of the Code, bonus,  employment,  stock or other equity,
     retention,  non-competition,  deferred compensation,  executive, severance,
     change in control or ownership or other benefit or compensatory plan, fund,
     program, policy,  agreement,  contract or commitment for the Company or any
     Subsidiary employees, former employees, directors, independent contractors,
     former independent  contractors or their dependents or their  beneficiaries
     (collectively,  all of the foregoing, the "Company Plans"). With respect to
     each Company Plan:

               (i) such Company Plan (and each related trust, insurance contract
          or fund) has been  administered in a manner consistent in all material
          respects  with its written  terms and  complies in form and  operation
          with  the  applicable   requirements   of  ERISA  and  the  Code,  all
          regulations,  and other applicable Laws, including without limitation,
          all tax rules for which  favorable tax  treatment is intended,  except
          for  any  such  violation  that  would  not,  individually  or in  the
          aggregate,  reasonably be expected to have a Company  Material Adverse
          Effect.


                                       20
<PAGE>

               (ii) all required reports and  descriptions  (including Form 5500
          Annual  Reports,  Summary  Annual  Reports,  PBGC-1's and Summary Plan
          Descriptions) have been timely filed or distributed appropriately with
          respect to such Company Plan, except for any such violation that would
          not, individually or in the aggregate,  reasonably be expected to have
          a Company Material Adverse Effect.

               (iii)  the  requirements  of Part 6 of  Subtitle  B of Title I of
          ERISA and Section 4980B of the Code have been met with respect to each
          such Company Plan which is an Employee  Welfare  Benefit Plan,  except
          for  any  such  violation  that  would  not,  individually  or in  the
          aggregate,  reasonably be expected to have a Company  Material Adverse
          Effect.

               (iv) all  material  contributions,  premiums  and other  payments
          (including all employer  contributions  and employee salary  reduction
          contributions)  that are  required  to be made  under the terms of any
          Company Plan or applicable  collective  bargaining agreement have been
          timely made or have been  adequately and properly  provided for in the
          financial   statements  contained  in  the  most  recent  Company  SEC
          Documents;

               (v) each such Company Plan which is an Employee  Pension  Benefit
          Plan and intended to be a "qualified plan" under Section 401(a) of the
          Code has received a favorable  determination  letter from the Internal
          Revenue  Service,  and,  to the  Company's  knowledge,  no  event  has
          occurred  which  could  reasonably  be  expected  to cause  the  loss,
          revocation or denial of any such favorable  determination letter other
          than legally required  amendments the time for the making of which has
          not yet expired;

               (vi) the Company  has made  available  and will  continue to make
          available to the Parent, upon its request, correct and complete copies
          of the plan documents and summary plan  descriptions,  the most recent
          determination  letter received from the Internal Revenue Service,  the
          most recent Form 5500 Annual Report, the most recent actuarial report,
          the most recent audited  financial  statements,  and all related trust
          agreements,  insurance  contracts  and other funding  agreements  that
          implement a Company  Plan.  The  valuation  summaries  provided by the
          Company reasonably  represent the assets and liabilities  attributable
          to Company  Plans  calculated in  accordance  with the Company's  past
          practices;

               (vii) no Company  Plan that is an Employee  Pension  Benefit Plan
          has been  amended in any manner  which  would  require  the posting of
          security under Section 401(a)(29) of the Code or Section 307 of ERISA;

               (viii)  neither the Company nor any of its  Subsidiaries  has any
          legally  binding plan or commitment to create any additional  employee
          benefit  plan or to


                                       21
<PAGE>

          materially modify or change any Company Plan affecting any employee or
          terminated  employee of the Company or any of its  Subsidiaries  other
          than as may be required in accordance with this Agreement.

               (ix)  the  Company  Disclosure  Letter  includes  (A) a  workers'
          compensation paid loss summary for the last three years on an accident
          year  basis,  which  summary  and  listing are true and correct in all
          material  respects;  and (B) a recent  listing  of all  open  workers'
          compensation claims showing claimant name, claim number,  description,
          paid loss and case  reserve  which  summary  and  listing are true and
          correct in all material respects;

               (x) the Company has never been, nor is it a party to or otherwise
          bound  by any  advance  agreement  or  similar  arrangement  with  any
          Governmental  Entity,  relating  to the  allowability,  allocation  or
          reimbursement of benefit costs or other matters in connection with any
          Company Plan; and

               (xi) all  Company  Plans are by their terms able to be amended or
          terminated by the Company.

          (b) With  respect to each  Company Plan that the Company or any of its
     Subsidiaries  maintains or has maintained  within the past six years, or to
     which  any of them  contributes,  ever  has  contributed  or ever  has been
     required to contribute in the past six years:

               (i) no such Company Plan that is an Employee Pension Benefit Plan
          subject to Title IV of ERISA  (other  than any  multiemployer  plan as
          defined in Section  37(A) of ERISA  ("Multiemployer  Plan"))  has been
          completely or partially  terminated (other than any termination which,
          individually or in the aggregate,  could not reasonably be expected to
          have a material liability), no reportable event (as defined in Section
          4043 of ERISA) as to which  notices would be required to be filed with
          the Pension Benefit Guaranty Corporation (the "PBGC") has occurred but
          has not  yet  been  so  reported,  and no  proceeding  by the  PBGC to
          terminate  such  Employee   Pension   Benefit  Plan  (other  than  any
          Multiemployer Plan) has been instituted;

               (ii) there have been no non-exempt  prohibited  transactions  (as
          defined in  Section  406 of ERISA and  Section  4975 of the Code) with
          respect to such plan,  no  fiduciary  has any material  liability  for
          breach  of  fiduciary  duty or any other  failure  to act or comply in
          connection with the administration or investment of the assets of such
          plan, and no action, suit,  proceeding,  hearing or investigation with
          respect to the  administration or the investment of the assets of such
          plan (other than  routine  claims for  benefits) is pending or, to the
          Company's knowledge, threatened;


                                       22
<PAGE>

               (iii) other than routine claims for benefits, neither the Company
          nor any of its  Subsidiaries  has  incurred,  and the  Company  has no
          reason to expect  that the  Company  or any of its  Subsidiaries  will
          incur,  any  material  liability  under Title IV of ERISA or under the
          Code with  respect to any  Company  Plan that is an  Employee  Pension
          Benefit Plan; and

               (iv) neither the Company nor any of its Subsidiaries has incurred
          any outstanding  liability under Section 4062 of ERISA to the PBGC, to
          a trust  established  under  Section  4041 or 4042 of  ERISA,  or to a
          trustee appointed under Section 4042 of ERISA.

          (c) Neither the Company nor any of its  Subsidiaries  contributes  to,
     contributed   to,  or  has  ever  been   obligated  to  contribute   to,  a
     Multiemployer Plan. None of the transactions contemplated by this Agreement
     will  trigger  any   withdrawal   or   termination   liability   under  any
     Multiemployer Plan set forth in the Company Disclosure Letter.

          (d) Other than  pursuant to a Company  Plan that is  disclosed  on the
     Company Disclosure Letter,  neither the Company nor any of its Subsidiaries
     has any  obligation to provide  medical,  health,  life  insurance or other
     welfare  benefits for current or future  retired or  terminated  employees,
     their spouses or their  dependents  (other than in accordance  with Section
     4980B of the Code).

          (e) No Company Plan  contains any  provision  that would  prohibit the
     transactions  contemplated  by this  Agreement  or would  give  rise to any
     severance,  termination,  payment,  acceleration  or  increase  in benefits
     provided by any Company Plan as a result of the  transactions  contemplated
     by this  Agreement  (alone or  together  with the  occurrence  of any other
     event).  Every  executive  of the Company that is covered by a Company Plan
     that is an  employment,  severance  or  change  of  control  agreement  has
     consented to the transactions contemplated by this Agreement.

          (f)  No  individual  classified  as a  non-employee  for  purposes  of
     receiving  employee  benefits  (such  an  independent  contractor,   leased
     employee,  consultant or special  consultant),  regardless of treatment for
     other purposes, is eligible to participate in or receive benefits under any
     Company Plan that does not specifically provide for their participation.

     Section 3.13 Environmental Matters.

          (a) Since December 31, 2001, (i) the Company and its Subsidiaries have
     been in compliance in all material respects with all Environmental Laws (as
     defined below) with respect to all real property owned,  leased (whether as
     lessor  or  lessee),  or  otherwise  used in  connection  with any of their
     operations,  (ii) neither the Company nor any of its  Subsidiaries  has any
     material  liability,  whether  contingent or otherwise,  under,  or for any


                                       23
<PAGE>

     violations  of, any  Environmental  Law,  (iii) no notices of any  material
     violation or alleged violation of,  non-compliance or alleged noncompliance
     with or any liability  under, any  Environmental  Law have been received by
     the Company or any of its Subsidiaries  that are currently  outstanding and
     unresolved  as of the date of this  Agreement,  (iv) there are no  material
     administrative,  civil or criminal writs,  injunctions,  decrees, orders or
     judgments  outstanding or any  administrative,  civil or criminal  actions,
     suits, claims,  proceedings or investigations  pending or, to the Company's
     knowledge,  threatened,  relating to compliance with or liability under any
     Environmental Law affecting the Company or any of its Subsidiaries, (v) the
     Company and its  Subsidiaries  possess all material  environmental  permits
     required by applicable Environmental Laws with respect to all real property
     owned,  leased  (whether  as  lessor  or  lessee),  or  otherwise  used  in
     connection with any of their  operations,  and (vi) to the knowledge of the
     Company,  no material changes or alterations in the practices or operations
     of the  Company  or any of its  Subsidiaries  as  presently  conducted  are
     anticipated to be required in the future in order to permit the Company and
     its  Subsidiaries  to continue to comply in all material  respects with all
     applicable Environmental Laws. The Company Disclosure Letter sets forth the
     amount  reserved  as of the  date  of this  Agreement  by the  Company  for
     management of any  liability  arising from,  or for  compliance  with,  all
     Environmental Laws.

          (b) The term  "Environmental  Law" as used in this Agreement means any
     Law, with respect to the  preservation  of the environment or the promotion
     of worker  health and safety,  including  any Law,  relating  to  Hazardous
     Materials  (as defined in Section  3.13(c)  below).  Without  limiting  the
     generality of the  foregoing,  the term  encompasses  each of the following
     statutes  and the  regulations  promulgated  thereunder,  and  any  similar
     applicable  state,  local  or  foreign  Law,  each  as  amended:   (i)  the
     Comprehensive  Environmental  Response,  Compensation  and Liability Act of
     1980,  (ii) the Solid Waste  Disposal Act,  (iii) the  Hazardous  Materials
     Transportation  Act, (iv) the Toxic  Substances  Control Act, (v) the Clean
     Water  Act,  (vi) the Clean Air Act,  (vii) the Safe  Drinking  Water  Act,
     (viii) the National  Environmental  Policy Act of 1969,  (ix) the Superfund
     Amendments  and  Reauthorization  Act of 1986,  (x) Emergency  Planning and
     Community  Right to Know Act, (xi) the Federal  Insecticide,  Fungicide and
     Rodenticide Act and (xii) the Occupational Safety and Health Act of 1970.

          (c) The term  "Hazardous  Materials" as used in this  Agreement  means
     each and every element, compound, chemical mixture, contaminant, pollutant,
     material,  waste or other  substance  (i) that is  defined,  determined  or
     identified  as hazardous or toxic under any  Environmental  Law or (ii) the
     spilling,  leaking,  pumping,  pouring,  emitting,  emptying,  discharging,
     injecting,  storing,  escaping,  leaching,  dumping,  discarding,  burying,
     abandoning or disposing into the  environment of which is prohibited  under
     any  Environmental  Law.  Without limiting the generality of the foregoing,
     the  term   includes  (i)   "hazardous   substances"   as  defined  in  the
     Comprehensive  Environmental  Response,  Compensation  and Liability Act of
     1980,  and  regulations  promulgated  thereunder,  each  as  amended,  (ii)
     "extremely  hazardous  substance" as defined in the Emergency  Planning and
     Community Right to Know Act and regulations promulgated thereunder, each as


                                       24
<PAGE>

     amended, (iii) "hazardous waste" as defined in the Solid Waste Disposal Act
     and regulations  promulgated  thereunder,  each as amended, (iv) "hazardous
     materials" as defined in the Hazardous Materials Transportation Act and the
     regulations  promulgated   thereunder,   each  as  amended,  (v)  "chemical
     substance  or mixture" as defined in the Toxic  Substances  Control Act and
     regulations  promulgated  thereunder,  each as amended,  (vi) petroleum and
     petroleum products and byproducts and (vii) asbestos.

     Section 3.14 Properties. The Company and its Subsidiaries have good and, in
the case of real  property,  marketable  title to all the  properties and assets
purported to be owned by them,  free and clear of all Liens except (a) Liens for
current Taxes or assessments that are not yet delinquent, (b) builder, mechanic,
warehousemen,  materialmen,  contractor,  workmen,  repairmen,  carrier or other
similar  Liens  arising and  continuing  in the ordinary  course of business for
obligations  that are not yet  delinquent,  (c) the  rights,  if any, of vendors
having  possession  of tooling of the  Company and its  Subsidiaries,  (d) liens
arising  from the  receipt  by the  Company  and its  Subsidiaries  of  progress
payments by the United States  government,  (e) Liens securing  rental  payments
under  capital  lease   arrangements   and  (f)  other  Liens  that  would  not,
individually  or in the  aggregate,  reasonably  be  expected  to have a Company
Material Adverse Effect (all of which are herein  collectively called "Permitted
Liens").  Such assets,  together with all assets held or used by the Company and
its  Subsidiaries  under  leases,  include all tangible and  intangible  assets,
contracts and rights  necessary or required for the operation of the  businesses
of the Company and its  Subsidiaries  as  presently  conducted  and as presently
proposed to be conducted  by the Company and its  Subsidiaries.  All  machinery,
equipment and other tangible  assets  currently being used by the Company or its
Subsidiaries  which are owned or leased by the Company or its  Subsidiaries  are
reasonably  adequate and suitable for the uses to which they are currently being
employed and are in good operating  condition and repair (ordinary wear and tear
excepted).

     Section 3.15 Intellectual Property Matters.

          (a) The  Company  and its  Subsidiaries  own or have the  right to use
     pursuant to valid license, sublicense, agreement or permission all items of
     Intellectual  Property (as defined  below)  necessary or required for their
     business or operations as presently  conducted and as presently proposed to
     be conducted.  Neither the Company nor any of its Subsidiaries has received
     any charge,  complaint,  claim, demand or notice alleging any interference,
     infringement,  misappropriation  or violation of the Intellectual  Property
     rights of any third  party.  Since  December  31,  1997,  to the  Company's
     knowledge,   no  third  party  has   interfered   with,   infringed   upon,
     misappropriated  or  otherwise  come into  conflict  with any  Intellectual
     Property rights of the Company or any of its  Subsidiaries.  The conduct of
     the  business and  operations  of the Company and its  Subsidiaries  do not
     infringe upon, misappropriate,  or misuse any patent, trademark, copyright,
     trade secret,  or other  intellectual  property or proprietary right of any
     third party. All of the Intellectual  Property is free and clear of any and
     all Liens.  There has been no  abandonment of any trademark or service mark
     included in any  Intellectual  Property used in the conduct of the business
     and  operations  of  the  Company  and  its   Subsidiaries.   All  material
     third-party


                                       25
<PAGE>

     licenses in  Intellectual  Property  used or held for use in the conduct of
     the  business  and  operations  of the  Company  and its  Subsidiaries  are
     described in the Company  Disclosure  Letter and,  except for the foregoing
     third-party  licenses,  no third party has rights in or  otherwise  has the
     right to restrict the conduct of the business and operations of the Company
     and its  Subsidiaries.  To the  Company's  knowledge,  there is no material
     defect,  virus,  timer,  clock,  counter,  back door,  time bomb,  or other
     limiting feature  incorporated  into any computer software used or held for
     use in the conduct of the  business and  operations  of the Company and its
     Subsidiaries that would erase data or programming,  create a likelihood for
     a breach of security or  confidentiality,  or otherwise  inhibit the proper
     operation of the computer  software and the ability or right of the Company
     or any of its  Subsidiaries  to conduct  its  business  and  operations  as
     presently conducted and as presently proposed to be conducted.

          (b) The term "Intellectual  Property" as used in this Agreement means,
     collectively,  U.S.  and foreign  patents and patent  applications,  patent
     disclosures,  trademarks,  service marks,  logos, trade names,  copyrights,
     copyrightable   materials,   and  mask   works,   and  all   registrations,
     applications, reissuances, continuations, continuations-in-part, revisions,
     extensions, reexaminations and associated good will with respect to each of
     the  foregoing,  computer  software  (including  source and object  codes),
     computer  programs,  computer  data  bases and  related  documentation  and
     materials,  data,  documentation,   trade  secrets,  confidential  business
     information (including ideas, formulas, compositions, inventions, know-how,
     manufacturing  and  production  processes  and  techniques,   research  and
     development information,  drawings, designs, plans, proposals and technical
     data,  financial,   marketing  and  business  data  and  pricing  and  cost
     information) and all other  intellectual  property rights (in whatever form
     or medium). The Company Disclosure Letter includes a list of all registered
     patents,  patent  applications,  trademarks  and service marks owned by the
     Company or any of its Subsidiaries.

     Section 3.16 Labor Matters. The Company Disclosure Letter sets forth a list
of all collective bargaining agreements, memoranda of understanding, settlements
or other labor  agreements  with any union or labor  organization.  There are no
disputes or  controversies  pending or, to the Company's  knowledge,  threatened
between  the  Company  or any of its  Subsidiaries  and any of their  current or
former employees or any labor or other collective  bargaining unit  representing
any such employee that would,  individually  or in the aggregate,  reasonably be
expected to have a Company Material  Adverse Effect,  or to result in a material
labor strike,  dispute,  slow-down or work stoppage. To the Company's knowledge,
there is no  organizational  effort  presently being made or threatened by or on
behalf of any labor union with respect to employees of the Company or any of its
Subsidiaries. To the Company's knowledge, no executive, key employee or group of
employees  of the Company or any of its  Subsidiaries  has any plan to terminate
employment with the Company or its Subsidiaries. There are no current Department
of Labor,  Office of Federal  Contract  Compliance  Programs or Equal Employment
Opportunity  Commission audits pending with respect to the Company or any of its
Subsidiaries.  As of the date of this Agreement,  there are no Office of Federal
Contract Compliance Programs  conciliation  agreements in effect with respect to
the Company or any of its Subsidiaries. There


                                       26
<PAGE>

are no material  liabilities or obligations relating to any individual's current
or former  employment with the Company or its  Subsidiaries or related  entities
arising in connection with any violation of any applicable law.

     Section 3.17 Rights Agreement.  The Company and its Board of Directors have
taken all action necessary to ensure that (a) the execution and delivery of this
Agreement,  and  the  consummation  of the  Merger  and the  other  transactions
contemplated  hereby,  will not cause (i) the Parent or the Merger Subsidiary to
become an  "Acquiring  Person"  (as  defined  in the Rights  Agreement),  (ii) a
"Shares   Acquisition   Date"  (as  defined  in  the  Rights   Agreement)  or  a
"Distribution  Date" (as defined in the Rights Agreement) to occur, or (iii) the
Rights to become  exercisable;  and (b) neither of the Company,  the Parent, the
Merger Subsidiary,  nor the Surviving  Corporation,  nor any of their respective
affiliates,  shall have any obligations  pursuant to the Rights  Agreement or to
any holder (or former holder) of Rights as of and following the Effective Time.

     Section 3.18 Insurance Policies. The Company's Disclosure Letter sets forth
the  insurance  policies  maintained  by the Company and its  Subsidiaries  (the
"Insurance  Policies") and their  respective  coverage and renewal dates. All of
such Insurance Policies are in full force and effect and neither the Company nor
any of its  Subsidiaries is in material  default with respect to its obligations
under any of such insurance  policies.  No notice of cancellation or termination
or  rejection  of any  claim  has been  received  by the  Company  or any of its
Subsidiaries  with respect to any such Insurance Policy in the last year. During
the past five years,  (i) the Company and its  Subsidiaries  has been covered by
insurance in scope and amount  customary and  reasonable  for the  businesses in
which it has been engaged  during such period,  and (ii) neither the Company nor
any of its Subsidiaries  has been denied  insurance,  or been offered  insurance
only at a commercially prohibitive premium.

     Section 3.19 Brokers' Fees. Except for the fees and expenses payable by the
Company to Houlihan  Lokey Howard & Zukin pursuant to a letter  agreement  dated
April 9, 2002, neither the Company nor any of its Subsidiaries has any liability
or obligation to pay any fees or commissions to any financial  advisor,  broker,
finder or agent with respect to the transactions contemplated by this Agreement.

     Section  3.20  Full  Disclosure.  No  representation  or  warranty  in this
Agreement,   and  no  statement   contained  in  any  document  or   certificate
contemplated by this Agreement  contains or will contain any untrue statement of
a material fact, or omits or will omit to state any material fact, necessary, in
light  of the  circumstances  under  which  it was  made,  in  order to make the
statements herein or therein not misleading.


                                       27
<PAGE>

                                    ARTICLE 4

     REPRESENTATIONS AND WARRANTIES OF THE PARENT AND THE MERGER SUBSIDIARY

     Each  of the  Parent  and  the  Merger  Subsidiary,  as the  case  may  be,
represents and warrants to the Company that:

     Section 4.1 Organization. Each of the Parent and the Merger Subsidiary is a
corporation duly organized, validly existing and in good standing under the laws
of the State of Delaware and has all requisite  corporate power and authority to
own, lease and operate its properties and assets and to carry on its business as
presently being conducted. All of the issued outstanding shares of capital stock
of the Merger Subsidiary have been duly authorized and are validly issued, fully
paid,  nonassessable  and free of preemptive  rights and are owned by the Parent
free and clear of any Lien.

     Section  4.2  Authorization  of  Transaction;  Enforceability.  Each of the
Parent and the Merger  Subsidiary has full corporate power and authority and has
taken all  requisite  corporate  action to enable it to execute and deliver this
Agreement,  to  consummate  the Merger and the other  transactions  contemplated
hereby, and to perform its obligations hereunder. Each of the Board of Directors
of the  Parent  and  the  Board  of  Directors  of  the  Merger  Subsidiary  has
unanimously  adopted  resolutions  approving this Agreement,  the Merger and the
other transactions contemplated hereby,  determining that the foregoing are fair
to, and in the best interests of, the Parent and its stockholders and the Merger
Subsidiary  and  its  sole  stockholder,  as the  case  may  be.  The  foregoing
resolutions of each such Board of Directors have not been modified, supplemented
or rescinded and remain in full force and effect. This Agreement constitutes the
valid and  legally  binding  obligation  of each of the  Parent  and the  Merger
Subsidiary,  enforceable  against  the  Parent  and  the  Merger  Subsidiary  in
accordance  with its terms  and  conditions  (except  as  enforceability  may be
limited  by  applicable  bankruptcy,  insolvency,  reorganization,   moratorium,
fraudulent  transfer  and similar laws of general  applicability  relating to or
affecting creditors' rights or by general equity principles).

     Section  4.3  Noncontravention;   Consents.  Except  for  (a)  filings  and
approvals  necessary to comply with the applicable  requirements of the Exchange
Act and the "blue sky" laws and  regulations  of  various  states,  (b)  filings
pursuant to the  Antitrust  Laws,  (c) the filing of the  Certificate  of Merger
pursuant to the Delaware Act, and (d) any filings  required  under the rules and
regulations of the New York Stock  Exchange,  neither the execution and delivery
of this Agreement by the Parent or the Merger  Subsidiary,  nor the consummation
by the Parent or the Merger Subsidiary of the transactions  contemplated hereby,
will  (i)  violate  or  conflict  with  any  provision  of  the  certificate  of
incorporation or bylaws of the Parent or the Merger Subsidiary,  (ii) violate or
conflict with any order, writ, judgment, injunction, decree, law, statute, rule,
order or regulation  applicable to the Parent or the Merger Subsidiary or any of
their  properties or assets,  or (iii) require Parent or any of its Subsidiaries
to make any  filing  or  registration  with,  notification  to,  or  obtain  the
authorization,  consent or approval of, any Governmental  Entity,


                                       28
<PAGE>

except in the case of clauses  (ii) and (iii) for such  violations  or  filings,
registrations, notifications,  authorizations, consents or approvals the failure
of which to obtain  would  not,  individually  or in the  aggregate,  affect the
ability of the Parent or the Merger  Subsidiary to consummate  the Merger and to
perform its respective obligations under this Agreement.

     Section 4.4 Brokers' Fees. Neither the Parent nor the Merger Subsidiary has
any  liability or  obligation  to pay any fees or  commissions  to any financial
advisor,  broker, finder or agent with respect to the transactions  contemplated
by this Agreement.

     Section 4.5 No Capital Ownership in the Company. Neither the Parent nor any
of its Subsidiaries owns any shares of Company Common Stock.

     Section 4.6 Adequate Cash Resources.  The Parent has or has available to it
the funds necessary to establish the Payment Fund.

                                    ARTICLE 5

                                    COVENANTS

     Section 5.1 General. Subject to the terms and conditions of this Agreement,
each of the parties will take all actions and do all things necessary, proper or
advisable to perform its obligations  under this Agreement which are required to
be performed on or prior to the Closing,  and use its reasonable best efforts to
consummate and make effective the transactions contemplated by this Agreement as
promptly as reasonably practical.

     Section 5.2 Further  Assurances.  Prior to the  Closing  Date,  each of the
parties will (a) give all  required  notices to third  parties and  Governmental
Entities  and  will  use  its  best  efforts  to  obtain  all  third  party  and
governmental  consents and approvals that it is required to obtain in connection
with this Agreement,  the Merger and the other transactions  contemplated hereby
and (b) use its best efforts to prevent any preliminary or permanent  injunction
or other order by a Governmental Entity that seeks to modify,  delay or prohibit
the consummation of the transactions  contemplated by this Agreement,  including
under the Antitrust Laws, and, if issued, to appeal any such injunction or order
through the appellate  court or body for the relevant  jurisdiction.  Within ten
(10)  business  days  following  the  execution of this  Agreement,  each of the
parties will file a Notification  and Report Form and related  material with the
Federal  Trade  Commission  and the  Antitrust  Division  of the  United  States
Department of Justice under the HSR Act, will use its respective best efforts to
obtain early  termination of the  applicable  waiting period under all Antitrust
Laws and will take all further actions and make all further filings  pursuant to
the Antitrust Laws that may be necessary, proper or advisable. Nothing contained
in this  Agreement  will be  deemed to  require  the  Parent  to enter  into any
agreement, consent decree or other commitment requiring the Parent or any of its
Subsidiaries  to (x) divest or hold  separate  any assets of the  Company or its
Subsidiaries, or the Parent or its Subsidiaries,  (y) litigate, pursue or defend
any action or proceeding challenging any of the transactions contemplated hereby
as violative  of any  Antitrust  Laws,  or (z) take any other action that would,
individually  or


                                       29
<PAGE>

in the  aggregate,  reasonably  be  expected to have a Parent  Material  Adverse
Effect. The term "Parent Material Adverse Effect" means any event, circumstance,
condition,  change,  development or effect that,  either  individually or in the
aggregate   with  all  other   events,   circumstances,   conditions,   changes,
developments or effects,  would have a material  adverse effect on the business,
condition (financial or otherwise),  assets, liabilities,  operations or results
of  operations  of the  Parent  and its  Subsidiaries  taken as a whole,  or the
ability of the Parent to consummate its  obligations  under this  Agreement.  In
connection  with the  foregoing,  each party (i) will promptly  notify the other
party in writing of any  communication  received by that party or its Affiliates
from any Governmental  Entity,  and subject to applicable Law, provide the other
party with a copy of any such written  communication  (or written summary of any
oral  communication),  and (ii) not  participate in any  substantive  meeting or
discussion with any Governmental Entity in respect of any filing,  investigation
or inquiry concerning the transactions  contemplated by this Agreement unless it
consults  with the other party in advance,  and to the extent  permitted by such
Governmental  Entity,  give the  other  party  the  opportunity  to  attend  and
participate thereat.

     Section 5.3 Interim Conduct of the Company.

          (a) Except as  expressly  permitted  by this  Agreement,  the  Company
     Disclosure  Letter or pursuant to the Parent's prior written consent,  from
     and after the date of this Agreement through the Closing, the Company will,
     and will cause each of its  Subsidiaries,  (i) to conduct its operations in
     accordance  with its  ordinary  course of  business,  consistent  with past
     practice, and (ii) to the extent consistent therewith, use its best efforts
     to preserve intact its business organizations,  keep available the services
     of its current  officers  and  employees,  preserve  the  goodwill of those
     having  business  relationships  with  the  Company  and its  Subsidiaries,
     preserve  its  relationships  with  customers,   creditors  and  suppliers,
     maintain  its  books,  accounts  and  records  and  comply in all  material
     respects with applicable Laws.

          (b) Notwithstanding the foregoing,  the Company will not, and will not
     cause or  permit  any of its  Subsidiaries  to,  take any of the  following
     actions without the prior written consent of the Parent:

               (i) amend its  certificate  (or  articles)  of  incorporation  or
          bylaws or file any  certificate of  designation or similar  instrument
          with  respect to any shares of its  authorized  but  unissued  capital
          stock;

               (ii)  authorize  or effect  any  stock  split or  combination  or
          reclassification of shares of its capital stock;

               (iii) declare or pay any dividend or distribution with respect to
          its capital  stock  (other than  dividends  payable by a  wholly-owned
          Subsidiary  of the  Company to the  Company  or  another  wholly-owned
          Subsidiary),  authorize for issuance or issue, sell, pledge or deliver
          any shares of its capital  stock  (other than


                                       30
<PAGE>

          in connection with the exercise of currently outstanding Stock Options
          listed  in  the  Company  Disclosure   Letter),   options,   warrants,
          commitments,  subscriptions,  other  rights to purchase  any shares of
          capital stock, or any other securities exercisable or exchangeable for
          or convertible into shares of its capital stock, or repurchase, redeem
          or otherwise  acquire for value any shares of its capital stock or any
          other  securities  exercisable or exchangeable for or convertible into
          shares of its capital stock;

               (iv) merge or consolidate with any entity;

               (v) sell,  lease,  license,  encumber or otherwise dispose of any
          assets or any interests therein that are material,  individually or in
          the aggregate,  to the Company and its Subsidiaries  taken as a whole,
          including any shares of the capital stock of any of its  Subsidiaries,
          other than assets  used,  consumed,  replaced or sold in the  ordinary
          course of business, consistent with past practice;

               (vi)  liquidate,  dissolve  or  effect  any  recapitalization  or
          reorganization in any form;

               (vii)  acquire any interest in any business  (whether by purchase
          of assets,  purchase of stock,  merger or otherwise) or enter into any
          joint venture,  partnership  agreement,  joint development  agreement,
          strategic alliance agreement or other similar agreement;

               (viii) create,  incur, endorse,  assume,  otherwise become liable
          for or suffer to exist any  indebtedness for borrowed money (including
          capital lease obligations) or guarantee any such indebtedness or issue
          or sell any debt  securities or warrants or rights to acquire any debt
          securities of the Company or its  Subsidiaries,  or guarantee any debt
          securities of others, other than indebtedness  existing as of the date
          of this  Agreement,  borrowings  under  existing  credit  lines in the
          ordinary  course  of  business,  consistent  with past  practice,  and
          intercompany  indebtedness  among  the  Company  and its  Subsidiaries
          arising  in the  ordinary  course of  business,  consistent  with past
          practice;

               (ix) create,  incur, assume or suffer to exist any Lien affecting
          any of its material assets or properties (other than Permitted Liens);

               (x) except as required  as the result of changes in GAAP,  change
          any  of  the  accounting  principles  or  practices  used  by it as of
          December  31,  2001,  or revalue in any  material  respect  any of its
          assets or properties,  other than write-downs of inventory or accounts
          receivable in the ordinary  course of business,  consistent  with past
          practice,  or manage its working  capital  other than in the  ordinary
          course of business, consistent with past practice;


                                       31
<PAGE>

               (xi)  except  as  required  under  the  terms  of any  collective
          bargaining agreement or consulting,  executive or employment agreement
          in effect on the date of this Agreement and except as set forth in the
          Company  Disclosure  Letter,  increase the compensation  payable or to
          become  payable to officers and salaried  employees  whose annual base
          salary exceeds  $75,000 or increase any bonus,  insurance,  pension or
          other benefit plan,  payment or  arrangement  made to, for or with any
          such  officers  or  salaried  employees,  or grant  any  severance  or
          termination  pay (A) to any executive  officer or director,  or (B) to
          any  other  employee  except  payments  made in  connection  with  the
          termination  of employees  who are not  executive  officers in amounts
          consistent  with its policies and past practice or pursuant to written
          agreements in effect;

               (xii)  enter into any  contract  or  commitment  or engage in any
          transaction  with  any  Affiliate  (other  than  the  Company  or  its
          Subsidiaries)  or enter into any contract or  commitment  or engage in
          any  transaction  with any  unaffiliated  person or entity or make any
          capital expenditure,  capital commitment, additions to property, plant
          or  equipment  if the  aggregate  dollar  value  would be in excess of
          $500,000 or would have a term of greater than one year;

               (xiii)  make or  change  any  material  Tax  election,  settle or
          compromise any material Tax liability,  change in any material respect
          any  accounting  method in respect of Taxes,  file any  amendment to a
          material  Tax  Return,  enter into any closing  agreement,  settle any
          material claim or material  assessment in respect of Taxes, or consent
          to any extension or waiver of the limitation  period applicable to any
          claim or assessment in respect of Taxes, except in the ordinary course
          of business;

               (xiv)  engage  in any  "reportable  transaction,"  including  any
          "listed  transaction,"  within the meaning of Section 6011 of the Code
          or any other  applicable  federal law including  any Internal  Revenue
          Service ruling, procedure, notice or other pronouncement;

               (xv) except as set forth in the Company Disclosure  Letter,  pay,
          discharge or satisfy any material  claims,  liabilities or obligations
          other than the payment,  discharge  and  satisfaction  in the ordinary
          course of business of liabilities  reflected on or reserved for in the
          consolidated financial statements of the Company or otherwise incurred
          in the ordinary course of business, consistent with past practice;

               (xvi) settle or  compromise  any material  pending or  threatened
          suit, action or proceeding;


                                       32
<PAGE>

               (xvii)  hold any meeting of its  stockholders  except the Company
          Stockholders  Meeting or to the extent  required by the request of the
          stockholders  entitled to call a meeting under the Company's bylaws or
          the Delaware Act;

               (xviii) take, or omit to take,  any action that would  reasonably
          be  expected  to  result  in a  material  violation  of Law or cause a
          termination  of or  material  breach of or default  under any  Company
          Material Agreement;

               (xix)  undertake any office  closing or employee  layoffs,  other
          than the ordinary course of business consistent with past practice;

               (xx) amend,  suspend or terminate the Rights  Agreement or redeem
          the Rights; or

               (xxi) agree,  resolve or commit to do any of the foregoing or any
          other action that could cause or could be  reasonably  likely to cause
          any of the conditions to the Merger to not be satisfied.

     Section 5.4 Proxy Statement.  As promptly as practicable  after the date of
this  Agreement,  the Company  will (a) duly call,  set a record date for,  give
notice of, convene and hold the Company  Stockholders  Meeting solely to approve
the  Merger  and  the  consummation  of the  transactions  contemplated  by this
Agreement, (b) prepare and file with the SEC a preliminary proxy statement which
will include all information pertaining to the transactions  contemplated hereby
or as otherwise  required by the Exchange Act for inclusion or  incorporation by
reference  therein,  (c)  promptly  respond  to any  comments  from the SEC with
respect to the preliminary proxy statement, and (d) cause the Proxy Statement to
be mailed to the Company Stockholders. The Proxy Statement will not, at the date
mailed to the Company  Stockholders,  at the time of the  Company  Stockholder's
Meeting,  or at the Effective Time,  contain any untrue  statement of a material
fact or omit to state  any  material  fact  required  to be  stated  therein  or
necessary in order to make the statements therein, in light of the circumstances
under which they are made,  not  misleading.  If before the Effective  Time, any
matter is  discovered by the Company that should be set forth in an amendment or
a supplement to the Proxy Statement, the Company will promptly inform the Parent
in writing and prepare and distribute  appropriate  amendments or supplements to
the Proxy  Statement.  Except  as  permitted  by  Section  5.6(c),  the Board of
Directors  of the  Company  will at all times  prior to and during  the  Company
Stockholders Meeting, recommend to the Company Stockholders the adoption of this
Agreement, the Merger and the transactions  contemplated hereby and will use its
best  efforts to solicit  such  approval  by the Company  Stockholders.  Without
limiting the generality of the foregoing,  the Company's  obligation pursuant to
the first  sentence of this  section  will not be affected by the  commencement,
public  proposal,  public  disclosure  or  communication  to the  Company of any
Acquisition Proposal or Superior Proposal (each as defined in Section 5.6).

     Section 5.5  Additional  Reports.  The Company  will  furnish to the Parent
copies of any Company SEC  Documents  that it files with the SEC on or after the
date hereof,  and the


                                       33
<PAGE>

Company  represents and warrants that as of the respective  dates thereof,  such
reports  will not contain  any untrue  statement  of a material  fact or omit to
state any material fact  required to be stated  therein or necessary in order to
make the statements therein, in light of the circumstances under which they were
made, not misleading.  Any unaudited  consolidated  interim financial statements
included in such reports (including any related notes and schedules) will fairly
present, in all material respects, the financial position of the Company and its
Subsidiaries  as of the dates thereof and the results of its  operations and its
cash flows or other  information  included  therein for the periods or as of the
dates  then  ended,  subject  to normal  year-end  adjustments,  in each case in
accordance with past practice and with GAAP consistently applied.

     Section 5.6 Nonsolicitation of Acquisition Proposals.

          (a)  The  Company,  each  of  its  Subsidiaries,  and  each  of  their
     respective  directors,  officers,  employees,  agents  and  representatives
     (collectively,  the "Company Representatives"),  will immediately cease any
     discussions or  negotiations  presently being conducted with respect to any
     Acquisition  Proposal (as defined in (f) below), and will not (i) initiate,
     encourage,  induce,  facilitate  or solicit,  directly or  indirectly,  any
     inquiries with respect to, or the making of, any Acquisition  Proposal,  or
     (ii) engage in or continue any  negotiations or discussions  with,  furnish
     any  information or data to, or enter into any letter of intent,  agreement
     in principle,  acquisition  agreement or similar agreement,  arrangement or
     understanding with any party relating to any Acquisition  Proposal (each an
     "Acquisition  Agreement");  provided,  however, that prior to obtaining the
     Company Stockholders  Approval,  the Board of Directors of the Company may,
     in  response  to a bona  fide,  unsolicited  Acquisition  Proposal  that it
     determines in good faith (after  consulting  with an independent  financial
     advisor) is reasonably  likely to result in or lead to a Superior  Proposal
     (as defined in (g)  below),  (A) furnish  information  with  respect to the
     Company and its  Subsidiaries  to the person making such Superior  Proposal
     pursuant to a confidentiality  agreement containing  provisions at least as
     restrictive  with respect to such person as the  restrictions on the Parent
     contained in the Confidentiality Agreement (as defined in Section 5.9), and
     (B) participate in discussions or negotiations  with the person making such
     Superior Proposal, if and only to the extent that, in each case referred to
     in (A) and (B), the Board of Directors  of the Company  determines  in good
     faith (after  consultation  with outside  legal  counsel)  that such action
     would be legally required in order to comply with their fiduciary duties to
     the  Company  Stockholders  under  applicable  Laws.  The  Company  will be
     responsible  for any breach of the provisions of this section by any of its
     Subsidiaries or any of the Company Representatives.

          (b) Within 24 hours after its receipt of any Acquisition Proposal, the
     Company  will provide the Parent with a copy of such  Acquisition  Proposal
     or, in connection  with any  non-written  Acquisition  Proposal,  a written
     statement  setting forth in reasonable  detail the terms and  conditions of
     such Acquisition  Proposal,  including the identity of the acquiring party.
     The Company  will  promptly  inform the Parent of the status and content of
     any discussions or negotiations involving any Acquisition Proposal and will
     promptly  furnish to the Parent any  non-public  information  furnished  in


                                       34
<PAGE>

     connection therewith.  Within 24 hours after any determination by the Board
     of Directors of the Company that an Acquisition  Proposal may be a Superior
     Proposal, the Company will notify the Parent of such determination.

          (c) Except as expressly  permitted by this section,  neither the Board
     of Directors of the Company nor any committee  thereof will (i) withdraw or
     modify,  or propose publicly to withdraw or modify,  in a manner adverse to
     the Parent,  the approval or  recommendation  by such Board of Directors or
     such committee of the Merger or this Agreement,  (ii) approve or recommend,
     or propose  publicly to approve or  recommend,  any  Acquisition  Proposal,
     (iii) cause the  Company to enter into any  Acquisition  Agreement  or (iv)
     redeem or otherwise render inapplicable the Rights Agreement, or the Rights
     granted thereunder in response to any Acquisition Proposal, unless prior to
     obtaining the Company Stockholders  Approval, the Board of Directors of the
     Company  (x)  receives  a  Superior  Proposal  that is not  subject  to any
     financing  condition,  and (y) determines in good faith (after consultation
     with outside legal  counsel) that such action would be legally  required in
     order for its directors to comply with their respective fiduciary duties to
     the Company Stockholders under applicable Laws; provided,  that the Company
     shall  immediately  inform the Parent orally and in writing of the material
     terms and  conditions  of such  Superior  Proposal  and the identity of the
     Person making it, or such other circumstances, and if any Superior Proposal
     is in writing,  the Company shall immediately deliver a copy thereof to the
     Parent.  Any withdrawal or modification of the  recommendation of the Board
     of  Directors  of the  Company  or  other  action  taken  pursuant  to this
     subsection  (c) shall not change the  approval of the Board of Directors of
     the Company for  purposes  of causing any state  takeover  statute or other
     state  law to be  inapplicable  to the  transactions  contemplated  hereby,
     including the Merger.

          (d) Notwithstanding  any other provision of this Agreement,  if, prior
     to obtaining the Company Stockholders  Approval,  the Board of Directors of
     the Company  determines,  in its good faith  judgment,  that an Acquisition
     Proposal is a Superior Proposal,  the Board of Directors of the Company may
     terminate  this  Agreement  (subject  to the  Company's  obligations  under
     Article 7); provided,  that (i) the Company provides at least five business
     days prior written  notice to the Parent of its intention to terminate this
     Agreement,  (ii) during such five  business day period (or longer period if
     extended  by the Company and the Parent,  the  "Negotiation  Period"),  the
     Company  agrees to negotiate in good faith with the Parent  regarding  such
     changes as the Parent may propose to the terms of this Agreement,  with the
     intent of enabling the Parent to agree to a modification  of this Agreement
     so that the  transactions  contemplated  hereby may be  consummated,  (iii)
     after  expiration  of the  Negotiation  Period,  the  Acquisition  Proposal
     remains a Superior  Proposal (taking into account any  modifications to the
     terms  thereof  proposed by the Parent) and the Board of  Directors  of the
     Company confirms its determination  (after  consultation with outside legal
     counsel  and  an  independent  financial  advisor)  that  it is a  Superior
     Proposal;  and (iv) the Company pays to the Parent in immediately available
     funds the  Termination  Fee (as defined in and in  accordance  with Section
     7.3).


                                       35
<PAGE>

          (e) Nothing in this section will prevent the Board of Directors of the
     Company from taking, and disclosing to the Company Stockholders, a position
     contemplated by Rules 14d-9(e) and 14e-2(a)  promulgated under the Exchange
     Act.

          (f) The term  "Acquisition  Proposal" as used in this Agreement  means
     any  inquiry,  proposal  or  offer  relating  to  a  possible  (i)  merger,
     consolidation  or similar  transaction  involving the Company or any of its
     Subsidiaries;   (ii)  sale,  lease  or  other   disposition,   directly  or
     indirectly,  (including by way of merger, consolidation,  share exchange or
     otherwise)  of any  assets  of  the  Company  or  any  of its  Subsidiaries
     representing,  in  the  aggregate,  20%  or  more  of  those  assets  on  a
     consolidated basis; (iii) issuance, sale or other disposition of (including
     by way of merger,  consolidation,  share exchange or otherwise)  securities
     (or options, rights or warrants to purchase or securities convertible into,
     such  securities)  representing  20% or more of the votes  attached  to the
     outstanding securities of the Company, (iv) transaction with the Company in
     which any person would acquire  "beneficial  ownership" (as defined in Rule
     13d-3  under  the  Exchange  Act),  or  the  right  to  acquire  beneficial
     ownership,  or any "group" (as defined  under the  Exchange  Act) will have
     been formed which  beneficially owns or has the right to acquire beneficial
     ownership of, 20% or more of the outstanding securities of the Company, (v)
     liquidation,  dissolution,   recapitalization  or  other  similar  type  of
     transaction  with respect to the Company or any of its  Subsidiaries,  (vi)
     transaction  which is similar in form,  substance  or purpose to any of the
     foregoing  transactions  or  (vii)  public  announcement  of an  agreement,
     proposal,  plan or intent to do any of the  foregoing;  provided,  however,
     that the term  "Acquisition  Proposal"  will not include the Merger and the
     transactions contemplated hereby.

          (g) The term "Superior  Proposal" as used in this Agreement  means any
     Acquisition Proposal not solicited in violation of this Section 5.6 that is
     on terms that the Board of  Directors  of the  Company  determines  in good
     faith (after  consulting  with  outside  legal  counsel and an  independent
     financial advisor) would (i) result in a transaction that is more favorable
     from a  financial  point  of  view to the  Company  Stockholders  than  the
     transactions  contemplated  hereby if such Acquisition  Proposal were to be
     consummated and (ii) has a reasonable likelihood of being consummated.

     Section 5.7 Indemnification.

          (a) From and  after  the  Closing  Date,  the  Parent  will  cause the
     Surviving  Corporation  to indemnify,  defend and hold harmless each person
     who is now, or has been at any time prior to the Effective Time, an officer
     or director of the Company or any of its  Subsidiaries  (collectively,  the
     "Indemnified  Parties")  from and against all losses,  claims,  damages and
     expenses (including reasonable attorney's fees and expenses) arising out of
     or  relating  to actions or  omissions,  or alleged  actions or  omissions,
     occurring at or prior to the Effective Time to the fullest extent permitted
     from time to time by the Delaware  Act, but  excluding any of the foregoing
     which relate to any violation or alleged violation of the Exchange Act with
     respect to insider trading.


                                       36
<PAGE>

          (b) Any  initial  determination  required  to be made with  respect to
     whether any Indemnified Party may be entitled to  indemnification  will, if
     requested by such Indemnified  Party, be made by independent  legal counsel
     selected  by the  Indemnified  Party  and  reasonably  satisfactory  to the
     Surviving Corporation.

          (c) For a period of six (6) years after the Closing  Date,  the Parent
     will use its best efforts to cause to be maintained  in effect  policies of
     directors  and  officers  liability   insurance  and  fiduciary   liability
     insurance  substantially  equivalent in scope and amount of coverage to the
     policies  maintained  by the Company as of the date hereof with  respect to
     claims arising from or relating to actions or omissions, or alleged actions
     or omissions,  occurring on or prior to the Effective Time. Notwithstanding
     the provisions of this Section 5.7(c),  the Parent will not be obligated to
     make total  premium  payments with respect to such policies of insurance to
     the extent such premiums exceed 200 percent of the last annual premium paid
     by the Company prior to the date of this  Agreement.  If the annual premium
     costs  necessary to maintain such insurance  coverage  exceed the foregoing
     amount,  the  Parent  will  use its  best  efforts  to  maintain  the  most
     advantageous  policies of directors  and officers  liability  insurance and
     fiduciary liability insurance  reasonably  obtainable for an annual premium
     not exceeding the foregoing amount,  provided that Indemnified  Parties may
     be required to make application and provide customary  representations  and
     warranties  to the  insurance  carrier  for the purpose of  obtaining  such
     insurance.

          (d) Subject to the  remainder of this section,  to the fullest  extent
     permitted  from time to time under the Delaware  Act, the Parent will cause
     the Surviving  Corporation  to pay on an  as-incurred  basis the reasonable
     fees and expenses of each Indemnified Party (including  reasonable fees and
     expenses  of counsel)  in advance of the final  disposition  of any action,
     suit,  proceeding  or  investigation  that is the  subject  of the right to
     indemnification,  subject to  reimbursement  in the event such  Indemnified
     Party is not entitled to indemnification.

          (e) The provisions providing for director and officer indemnification,
     abrogation  of  liability  and  advancement  of  expenses  set forth in the
     certificate  of  incorporation  and/or  bylaws of the  Company as in effect
     immediately prior to the date hereof,  will apply to each Indemnified Party
     with respect to all matters  occurring on or prior to the  Effective  Time.
     The  foregoing  will not be deemed to restrict  the right of the  Surviving
     Corporation  to modify the provisions of its  certificate of  incorporation
     relating to director and officer  indemnification,  abrogation of liability
     or advancement of expenses with respect to events or occurrences  after the
     Closing Date but such  modifications  shall not adversely affect the rights
     of the Indemnified Parties hereunder.  The Parent shall cause the Surviving
     Corporation to honor the provisions of this Section 5.7(e).

          (f)  Subject to any  requirements  pursuant  to  applicable  insurance
     policies that might conflict with the provisions of this subsection, in the
     event any action, suit,


                                       37
<PAGE>

     investigation or proceeding is brought against any Indemnified  Parties and
     under applicable  standards of professional  conduct there is a conflict of
     interest on any  significant  issue  between the position of the Parent (or
     the  Surviving  Corporation)  and an  Indemnified  Party,  the  Indemnified
     Parties may retain counsel, which counsel shall be reasonably  satisfactory
     to the Parent, and the Parent shall cause the Surviving  Corporation to pay
     all  reasonable  fees and  expenses  of such  counsel  for the  Indemnified
     Parties  promptly as statements  therefor are received,  provided,  however
     that (1) the Parent or the  Surviving  Corporation  shall have the right to
     assume the defense  thereof  (which right shall not affect the right of the
     Indemnified  Parties to be reimbursed for separate  counsel as specified in
     the preceding  sentence),  (2) the Parent and the Indemnified  Parties will
     cooperate in the defense of any such matter and (3) neither  Parent nor the
     Surviving  Corporation shall be liable for any settlement  effected without
     its prior  written  consent.  The  Indemnified  Parties  as a group may not
     retain more than one counsel to  represent  them with  respect to each such
     matter unless under applicable standards of professional conduct there is a
     conflict of interest on any significant  issue between the positions of two
     or more Indemnified Parties.

          (g) Upon learning of any loss, claim, damage or expense which may give
     rise to a claim  for  indemnity  hereunder,  any  Indemnified  Party  shall
     promptly  notify  Parent  thereof in writing,  but any failure to give such
     notice shall not affect the indemnification  obligations of any party under
     this Section 5.7 unless such failure  jeopardizes  or prejudices the Parent
     or the Surviving Corporation in any material respect.

          (h) The rights of each Indemnified Party hereunder will be in addition
     to any other rights such  Indemnified  Party may have under the certificate
     of  incorporation  or bylaws of the Surviving  Corporation  or any of their
     respective   Subsidiaries,   under   the   Delaware   Act   or   otherwise.
     Notwithstanding  anything to the contrary  contained  in this  Agreement or
     otherwise, the provisions of this Section 5.7 will survive the consummation
     of the Merger,  and each  Indemnified  Party will,  for all purposes,  be a
     third party  beneficiary of the covenants and agreements  contained in this
     Section 5.7 and, accordingly,  will be treated as a party to this Agreement
     for purposes of the rights and  remedies  relating to  enforcement  of such
     covenants  and  agreements  and will be entitled to enforce any such rights
     and  exercise  any  such  remedies  directly  against  the  Parent  and the
     Surviving Corporation.

          (i)  Nothing  in  this  Section  5.7  will   diminish  any  rights  or
     entitlements  available to any director or officer of the Company under the
     Company's  certificate of incorporation as in effect  immediately  prior to
     the date hereof.

     Section 5.8 Public Announcements. The initial press releases issued by each
party announcing the Merger and the transactions  contemplated by this Agreement
will be in a form that is  mutually  acceptable  to the Parent and the  Company.
Thereafter,  the Parent and the Company  will  consult  with one another  before
issuing any press  releases or otherwise  making any public  announcements  with
respect to the transactions contemplated by this Agreement, and


                                       38
<PAGE>

except as may be required by applicable  law or by the rules and  regulations of
the New York Stock  Exchange or of The Nasdaq Stock  Market,  will not issue any
such press release or make any such announcement prior to such consultation.

     Section 5.9 Full Access.  The Company will, and will cause its Subsidiaries
and the  Company  Representatives  to,  afford  the  Parent  and  its  officers,
employees,  agents and representatives full access to all premises,  properties,
employees, information, books, records, contracts and documents of or pertaining
to the Company and its Subsidiaries.  Any information  disclosed will be subject
to the provisions of the  Confidentiality  Agreement  between the Parent and the
Company effective March 11, 2002 (the "Confidentiality Agreement").

     Section 5.10 Actions Regarding Antitakeover Statutes. If Section 203 of the
Delaware Act or any other fair price,  moratorium,  control share acquisition or
other form of antitakeover  statute, rule or regulation is or becomes applicable
to the  transactions  contemplated by this Agreement,  the Board of Directors of
the  Company  will grant such  approvals  and take such other  actions as may be
required so that the  transactions  contemplated  hereby may be  consummated  as
promptly as practicable on the terms and conditions set forth in this Agreement.

     Section 5.11 Employee Benefit Matters.

          (a) Subject to applicable collective bargaining agreements,  until (or
     in respect of the period  ending on)  December  31,  2002,  the Parent will
     cause to be  maintained  for the  employees  and  former  employees  of the
     Company and its Subsidiaries (the "Employees"), benefits and benefit levels
     which are, in the  aggregate,  substantially  comparable  to  benefits  and
     benefit levels as provided by the Company and its Subsidiaries  through any
     Company Plan that is an Employee  Pension Benefit Plan, or Employee Welfare
     Benefit Plan,  or a fringe  benefit  program  providing for such matters as
     sick  pay and  vacation  pay,  immediately  prior  to the  Effective  Time.
     Notwithstanding  the  foregoing,  this section will not apply to any bonus,
     incentive,  or  equity-based  plan or  arrangement,  including the Advanced
     Technical Products,  Inc. 1998 Employee Stock Purchase Plan (the "ESPP") or
     the Advanced  Technical  Products,  Inc.  Deferred  Compensation  Plan (the
     "Deferred Compensation Plan").

          (b) Solely for purposes of eligibility  and vesting under the employee
     benefit plans of the Parent and its  Subsidiaries  (including the Surviving
     Corporation)  providing benefits to any Employees after the Effective Time,
     each  Employee  will be credited  with his or her years of service with the
     Company and its Subsidiaries  before the Effective Time, to the same extent
     as such  employee was entitled,  before the  Effective  Time, to credit for
     such service under any similar Company Plan.  Following the Effective Time,
     the  Parent  will,  or will  cause  its  Subsidiaries  to,  (i)  waive  any
     pre-existing  condition  limitation under any Employee Welfare Benefit Plan
     maintained by the Parent or any of its  Subsidiaries in which Employees and
     their  eligible  dependents  participate  (except to the  extent  that such
     pre-existing  condition  limitation  would have been  applicable  under the
     comparable  Company Employee Welfare Benefit Plans immediately prior to the


                                       39
<PAGE>

     Effective  Time),  and (ii)  provide  each  Employee  with  credit  for any
     co-payments and  deductibles  incurred prior to the Effective Time (or such
     earlier or later  transition date to new Employee  Welfare  Benefits Plans)
     for the calendar year in which the Effective Time (or such earlier or later
     transaction  date)  occurs,  in  satisfying  any  applicable  deductible or
     out-of-pocket  requirements  under any  welfare  plans  that the  Employees
     participate in after the Effective Time.

          (c) The Company agrees that an independent trustee, either a bank or a
     trust  company,  will act with  respect  to the  Merger  on  behalf of each
     Company  Plan (and its  participants)  that holds  Company  Common Stock in
     accordance with the terms and conditions of such Company Plan.

          (d) As soon as practicable  following the date of this Agreement,  the
     Board of  Directors  of the Company  (or,  if  appropriate,  any  committee
     administering  the ESPP)  will adopt  such  resolutions  or take such other
     actions (if any) as may be required to provide that (i) with respect to the
     offering period under the ESPP under way immediately prior to the Effective
     Time, the scheduled exercise date will be accelerated,  and all unexercised
     rights  granted in respect of such  offering  period will be exercised  not
     later  than  immediately  prior to the  Effective  Time,  (ii) all  holding
     periods with respect to shares of Company  Common Stock under the ESPP will
     be waived immediately prior to the consummation of the Company Stockholders
     Approval so as to permit the holders thereof to approve this Agreement, and
     (iii) the ESPP will terminate at the Effective Time.

          (e) No additional Stock Options,  stock  appreciation  rights or other
     equity-based  awards  or other  rights to  acquire  Company  Stock  will be
     granted  pursuant to the Company Stock Plans or otherwise after the date of
     this  Agreement.  The Company,  its Board of  Directors,  or any  committee
     thereof,  shall take all actions  prior to the  Effective  Time  necessary,
     proper or advisable to effect the consummation of the actions  contemplated
     by the  provisions  of Section  1.8  herein,  including  but not limited to
     making  appropriate  amendments  to the Company  Stock Plans  and/or  their
     underlying agreements.

          (f) Nothing  contained  in this  section will create any rights in any
     third party, including without limitation, any right to employment or right
     to  any  particular  benefit.  Except  as  specifically  provided,  nothing
     contained herein will be construed as prohibiting or restricting in any way
     the right of the  Parent or the  Surviving  Corporation  (or any  successor
     thereto) to modify,  amend or terminate any employee benefit plan,  program
     or arrangement in whole or in part at any time after the Effective Time.

          (g) As soon as practicable  following the date of this Agreement,  the
     Compensation  Committee  of the Board of  Directors  of the  Company or the
     Chief  Executive  Officer of the  Company  (or, if  appropriate,  any other
     individual  administering the Deferred  Compensation  Plan) will adopt such
     resolutions or take such other actions (if any) as may be necessary, proper
     or advisable to terminate the Deferred  Compensation


                                       40
<PAGE>

     Plan immediately prior to the Effective Time such that all account balances
     thereunder   will  be  distributed  in  accordance   with  the  termination
     provisions of said plan.

     Section 5.12 Standstill Provisions.  The restrictions on the Parent and the
Merger Subsidiary  contained in Section 9 of the  Confidentiality  Agreement are
hereby  waived by the Company to the extent  reasonably  necessary to permit the
Parent and the Merger  Subsidiary  to comply with their  obligations  or enforce
their rights under this Agreement.

     Section 5.13 Notice of  Developments.  The Company will give prompt written
notice to the Parent of the  occurrence  of any event which would  reasonably be
expected to result in a Company Material Adverse Effect. Each of the Company and
the Parent will give prompt  written  notice to the other of the  occurrence  or
failure  to occur of an event  that  would,  or,  with the  lapse of time  would
reasonably be expected to cause any condition to the  consummation of the Merger
not to be satisfied.  No such written  notice will be deemed to have amended any
of the disclosures set forth in the Company Disclosure Letter, to have qualified
the  representations  and  warranties  contained  herein  or to have  cured  any
misrepresentation or breach of a representation or warranty that otherwise might
have existed hereunder by reason of such material development.

                                    ARTICLE 6

                  CONDITIONS TO THE CONSUMMATION OF THE MERGER

     Section 6.1  Conditions to the  Obligations  of Each Party.  The respective
obligation  of each party to  consummate  the Merger and the other  transactions
contemplated  hereby is subject to the  satisfaction  at or prior to the Closing
Date of each of the  following  conditions,  any of which  may be  waived by the
written agreement of the parties:

          (a) the Company will have obtained the Company Stockholders Approval;

          (b) no order,  decree,  ruling,  judgment or injunction will have been
     enacted,  entered,  promulgated or enforced by any  Governmental  Entity of
     competent  jurisdiction  that prohibits the Merger and the  consummation of
     the transactions  contemplated by this Agreement substantially on the terms
     contemplated hereby, and continue to be in effect; and

          (c) all applicable  waiting periods under any Antitrust Laws will have
     expired or been  terminated  and all other  approvals  of any  Governmental
     Entity  will have been  obtained,  except  where the failure to obtain such
     other approvals of any  Governmental  Entity would not,  individually or in
     the aggregate,  reasonably be expected to have a Company  Material  Adverse
     Effect or a Parent Material Adverse Effect.

     Section 6.2 Conditions to the Obligation of the Company. The obligations of
the Company to  consummate  the Merger and the other  transactions  contemplated
hereby,  are subject


                                       41
<PAGE>

to the  satisfaction  at or prior to the Closing  Date of each of the  following
conditions, any of which may be waived by the Company:

          (a) the  representations  and  warranties of the Parent and the Merger
     Subsidiary  contained herein (which for purposes of this subparagraph shall
     be read as though none of them contained any Parent Material Adverse Effect
     or  materiality  qualification)  shall be true and correct in all  material
     respects as of the  Closing  Date with the same effect as though made as of
     the Closing Date (provided that any  representations and warranties made as
     of a specified  date shall be required only to continue on the Closing Date
     to be true and correct as of such specified date);

          (b) each of the Parent and the Merger  Subsidiary  will have performed
     or complied with in all material  respects all  covenants  and  obligations
     required to be performed or complied with by it under this  Agreement at or
     prior to the Effective Time; and

          (c) The Parent  shall have  delivered  to the  Company a  certificate,
     dated the Closing Date and signed by an executive  officer,  certifying the
     satisfaction of the conditions set forth above.

     Section  6.3  Conditions  to the  Obligation  of the  Parent and the Merger
Subsidiary.  The  obligations  of  the  Parent  and  the  Merger  Subsidiary  to
consummate  the  Merger  and the other  transactions  contemplated  hereby,  are
subject  to the  satisfaction  at or  prior to the  Closing  Date of each of the
following  conditions,  any of which may be waived by the  Parent or the  Merger
Subsidiary:

          (a) the representations and warranties of the Company contained herein
     (which for  purposes of this  subparagraph  shall be read as though none of
     them  contained  any  Company   Material   Adverse  Effect  or  materiality
     qualification) shall be true and correct in all material respects as of the
     Closing  Date with the same effect as though  made as of the  Closing  Date
     (provided that any  representations  and warranties  made as of a specified
     date shall be required  only to continue at the Closing Date to be true and
     correct as of such specified date);

          (b) the Company will have  performed or complied  with in all material
     respects all  obligations  required to be performed or complied  with by it
     under this Agreement at or prior to the Effective Time;

          (c) from the date of this Agreement to the Effective Time,  there will
     not have been any event or  development  that has, or would  reasonably  be
     expected to have, a Company Material Adverse Effect;

          (d) no more than 15% of the Company  Common  Stock will be  Dissenting
     Shares; and


                                       42
<PAGE>

          (e) the  Company  shall have  delivered  to the Parent a  certificate,
     dated as of the Closing Date and signed by an executive officer, certifying
     the satisfaction of the conditions set forth above.

     Section 6.4  Frustration of Closing  Conditions.  None of the Company,  the
Parent or the Merger  Subsidiary  may rely on the failure of any  condition  set
forth in Section  6.1,  6.2 or 6.3, as the case may be, to be  satisfied if such
party's breach of this Agreement has been a principal reason that such condition
has not been satisfied.

                                    ARTICLE 7

                                   TERMINATION

     Section 7.1  Termination.  This  Agreement may be terminated and the Merger
may be abandoned at any time prior to the Effective Time:

          (a) by mutual written consent of the Parent and the Company;

          (b) by either  the  Company  or the  Parent,  if the  Closing  has not
     occurred on or before June 30,  2002,  provided  that the party  seeking to
     terminate  this  Agreement  pursuant to this clause has not breached in any
     material  respect its  obligations  under this Agreement in any manner that
     has  contributed  to the failure to consummate the Merger on or before such
     date;

          (c) by either the  Company  or the  Parent,  if (i) an order,  decree,
     ruling, judgment or injunction has been entered by a Governmental Entity of
     competent  jurisdiction  permanently  restraining,  enjoining  or otherwise
     prohibiting the consummation of the Merger and such order, decree,  ruling,
     judgment or injunction  has become final and  non-appealable,  and (ii) the
     party seeking to terminate this Agreement  pursuant to this clause has used
     all reasonable best efforts to remove such order, decree, ruling,  judgment
     or injunction;

          (d) by either the Company or the Parent,  if the Company  Stockholders
     Approval  was not obtained at the Company  Stockholders  Meeting (or at any
     adjournment,  postponement or continuation thereof), unless such failure to
     obtain the Company Stockholders Approval is the result of a material breach
     of this Agreement by the party seeking to terminate this Agreement;

          (e) by the Parent:

               (i) if (A) the Board of Directors of the Company has withdrawn or
          modified  or changed  in a manner  adverse to the Parent or the Merger
          Subsidiary,  its approval or  recommendation  of this Agreement or the
          Merger,  or has  recommended an Acquisition  Proposal (or has publicly
          proposed to take any such actions),  (B) the Company accepts a written
          offer for, or  otherwise  enters into an


                                       43
<PAGE>

          agreement to  consummate or  consummates  an  Acquisition  Proposal or
          similar  business  combination  with a person or entity other than the
          Parent, the Merger Subsidiary or their affiliates,  or (C) the Company
          has failed to perform any of its obligations pursuant to, or otherwise
          violated the terms of,  Section 5.6, (or the Board of Directors of the
          Company resolves to do any of the foregoing);

               (ii) if the  Company  (A)  breaches or fails to perform or comply
          with any of its material covenants and agreements  contained herein or
          (B)  breaches  its  representations  and  warranties  in any  material
          respect such that the  conditions  set forth in Section 6.1 or Section
          6.3 would not be satisfied and such breach is not cured within 20 days
          after the date written notice of such breach is given by the Parent to
          the Company; or

          (f) by the Company:

               (i) pursuant to the terms and conditions of Section 5.6(d);

               (ii) if the Parent or the Merger Subsidiary (A) breaches or fails
          to perform or comply with any of its material covenants and agreements
          contained herein, or (B) breaches its  representations  and warranties
          in any material  respect such that the conditions set forth in Section
          6.1 or  Section  6.2 would not be  satisfied,  and such  breach is not
          cured within 20 days after the date  written  notice of such breach is
          given by the Company to the Parent.

     Section 7.2 Effect of Termination.  In the event of the termination of this
Agreement  pursuant to Section 7.1, this  Agreement will become void and will be
deemed to have terminated  without  liability or obligation to any party (except
for any liability of any party in willful breach of any covenant or agreement of
this Agreement prior to the termination hereof); provided that the provisions of
the Confidentiality Agreement and the last sentence of Section 5.9, this Section
7.2, Section 7.3, Section 7.4, and Article 8 (other than the exception clause in
Section  8.10)  of this  Agreement  will  continue  in  full  force  and  effect
notwithstanding such termination and abandonment.

     Section 7.3 Termination  Fee.  Notwithstanding  any other provision of this
Agreement:

          (a) if this Agreement is terminated  pursuant to Section  7.1(e)(i) or
     Section 7.1(f)(i),  then the Company shall concurrently pay to the Parent a
     fee of $5,500,000 (the "Termination Fee");

          (b) if (i) this Agreement is terminated  pursuant to Section 7.1(b) or
     Section  7.1(e)(ii),  (ii)  prior  to  such  termination  there  exists  an
     Acquisition  Proposal  (whether  or not  such  offer or  proposal  has been
     rejected or has been withdrawn prior to the time of such termination),  and
     (iii)  within 12  months of such  termination,  the  Company  or any of its
     Subsidiaries  accepts a written  offer for,  or  otherwise  enters  into an
     agreement to


                                       44
<PAGE>

     consummate or  consummates,  an  Acquisition  Proposal  (which,  solely for
     purposes  of this  clause  (iii) shall mean an  "Acquisition  Proposal"  as
     defined in Section  5.6(f),  except  that all  references  therein to "20%"
     shall be deemed instead to be "50%"), then upon the signing of a definitive
     agreement relating to such Acquisition  Proposal,  or, if no such agreement
     is signed,  then upon  consummation of any such Acquisition  Proposal,  the
     Company shall promptly pay to the Parent the Termination Fee;

          (c) if (i) this  Agreement is terminated  pursuant to Section  7.1(d),
     and (ii) within 12 months of such a  termination  the Company or any of its
     Subsidiaries  accepts a written  offer for,  or  otherwise  enters  into an
     agreement to consummate or consummates,  an Acquisition Proposal, then upon
     the  signing  of  a  definitive  agreement  relating  to  such  Acquisition
     Proposal, or, if no such agreement is signed, then upon consummation of any
     such Acquisition Proposal, the Company shall promptly pay to the Parent the
     Termination Fee;

     Section 7.4 Other Termination Fee Matters.  Except as specifically provided
in Section  7.3,  each party will bear its own expenses  incurred in  connection
with  the  transactions  contemplated  by this  Agreement,  whether  or not such
transactions are consummated. The obligation to pay the Termination Fee pursuant
to Section 7.3 shall be in addition to any other rights or remedies  that may be
available to the Parent.  The Company shall make all such  payments  required by
Section 7.3 promptly  (and in any event  within two business  days of receipt by
the Company of written  notice from the Parent) by wire transfer of  immediately
available funds to an account designated by the Parent. The Company acknowledges
that the agreements  regarding the  Termination  Fee contained in this Agreement
are an integral part of the transactions  contemplated  hereby,  and that in the
absence of such agreements,  the Parent and the Merger Subsidiary would not have
entered into this Agreement.  The Company  accordingly  agrees that in the event
the Company  fails to pay the  Termination  Fee  promptly,  the Company  will in
addition  to the  payment  of such  amount,  also pay to the  Parent  all of the
reasonable  costs  and  expenses  (including   reasonable  attorneys'  fees  and
expenses)  incurred by the Parent in the enforcement of its rights under Section
7.3,  together  with interest on such amount at a rate of 10% per annum from the
date upon which such payment was due, to and including  the date of payment.  If
the Company has not breached Section 5.6, payment of the Termination Fee will be
in full  and  complete  satisfaction  of,  and  will be the  Parent's  sole  and
exclusive  remedy for, any loss,  liability,  damage or claim  arising out of or
related to any such termination of this Agreement.


                                       45
<PAGE>

                                    ARTICLE 8

                                  MISCELLANEOUS

     Section 8.1 Nonsurvival of Representations. None of the representations and
warranties  contained in this  Agreement or in any  certificate,  instrument  or
other writing  delivered  pursuant to this  Agreement will survive the Merger or
the termination of this Agreement.

     Section 8.2 Specific Performance. The parties agree that irreparable damage
would  occur in the  event  any of the  provisions  of this  Agreement  were not
performed in accordance with their specific terms. It is accordingly agreed that
the  parties  will be  entitled  to  specific  performance  of the terms of this
Agreement,  without posting a bond or other security,  this being in addition to
any other remedy to which they are entitled at law or in equity.

     Section 8.3 Successors  and Assigns.  Neither this Agreement nor any of the
rights,  interests or obligations provided by this Agreement will be assigned by
any of the parties (whether by operation of law or otherwise)  without the prior
written consent of the other parties.  Subject to the preceding  sentence,  this
Agreement  will be binding  upon and inure to the benefit of the parties  hereto
and their respective successors and permitted assigns.

     Section 8.4  Amendment.  This Agreement may be amended by the execution and
delivery  of a written  instrument  by or on behalf of the  Parent,  the  Merger
Subsidiary and the Company at any time before or after the Company  Stockholders
Approval,  provided that after the date of the Company Stockholders Approval, no
amendment  to  this   Agreement  will  be  made  without  the  approval  of  the
stockholders of the Company if and to the extent such approval is required under
the Delaware Act.

     Section 8.5 Extension of Time;  Waiver.  At any time prior to the Effective
Time,  the parties may extend the time for  performance  of or waive  compliance
with any of the covenants, agreements or conditions of the other parties to this
Agreement, and may waive any breach of the representations or warranties of such
other parties. No agreement extending or waiving any provision of this Agreement
will be valid or binding  unless it is in writing and is executed and  delivered
by or on behalf of the party against which it is sought to be enforced.

     Section  8.6  Severability.  Whenever  possible,  each  provision  of  this
Agreement  will be interpreted in such manner as to be effective and valid under
applicable  Law, but if any provision of this Agreement is held to be prohibited
by or invalid under  applicable Law, such provision will be ineffective  only to
the extent of such prohibition or invalidity, without invalidating the remainder
of this Agreement.

     Section 8.7  Counterparts.  This  Agreement  may be executed in two or more
counterparts,   each  of  which  will  be  deemed  an  original,  but  all  such
counterparts taken together will constitute one and the same Agreement.


                                       46
<PAGE>

     Section  8.8  Descriptive  Headings.   The  descriptive  headings  of  this
Agreement are inserted for  convenience  only and will not  constitute a part of
this Agreement.

     Section 8.9 Notices. All notices and other communications hereunder will be
in writing (including  telecopy or similar writing) and will be effective (a) if
given by facsimile,  when such facsimile is transmitted to the facsimile  number
specified below and the appropriate facsimile confirmation is received or (b) if
given by any other means, when delivered at the address specified below:

     If to the Parent
     or the Merger Subsidiary:         General Dynamics Corporation
                                       3190 Fairview Park Drive
                                       Falls Church, VA 22042
                                       Attention: David Savner, Esq.
                                                  Senior Vice President and
                                                  General Counsel, Secretary
                                       Facsimile No.: (703) 876-3554

     With a copy (which will
     not constitute notice) to:        Jenner & Block, LLC
                                       One IBM Plaza, 39th Floor
                                       Chicago, IL 60611
                                       Attention: Thaddeus J. Malik, Esq.
                                       Facsimile No.: (312) 840-7313

     If to the Company:                Advanced Technical Products, Inc.
                                       200 Mansell Court East, Suite 505
                                       Roswell, GA 30076
                                       Attention: Garrett Dominy
                                                  President and Chief Executive
                                                  Officer
                                       Facsimile No.: (770) 993-1986

     With a copy (which will
     not constitute notice ) to:       Porter & Hedges, L.L.P.
                                       700 Louisiana, 35th Floor
                                       Houston, Texas  77002
                                       Attention: James M. Harbison, Jr., Esq.
                                       Facsimile No.: (713) 226-1331

or to such  other  address  or to the  attention  of such  other  party that the
recipient  party has specified by prior  written  notice to the sending party in
accordance with the preceding.


                                       47
<PAGE>

     Section 8.10 No Third Party  Beneficiaries.  Except as provided pursuant to
Section  5.7,  the  terms  and  provisions  of this  Agreement  will not  confer
third-party  beneficiary rights or remedies upon any person or entity other than
the parties hereto and their respective successors and permitted assigns.

     Section  8.11  Entire  Agreement.   This  Agreement,   the  Confidentiality
Agreement,  the Company  Disclosure  Letter and the other documents  referred to
herein  collectively  constitute  the entire  agreement  among the  parties  and
supersede   any  prior  and   contemporaneous   understandings,   agreements  or
representations by or among the parties,  written or oral, that may have related
in any way to the subject matter hereof.

     Section 8.12  Construction.  The language  used in this  Agreement  will be
deemed to be the language  chosen by the parties to express  their mutual intent
and no rule of strict construction will be applied against any party. The use of
the word "including" in this Agreement means "including without  limitation" and
is intended by the parties to be by way of example  rather than  limitation.  As
used in this  Agreement,  the  qualification  "to the Company's  knowledge"  and
clauses of similar  effect  mean the actual  knowledge  after due inquiry of any
executive  officer of the Company or of its  Subsidiaries  (or other  officer or
manager of the  Company or of its  Subsidiaries  if such  officer or manager has
primary  responsibility over the subject matter in question) of the existence or
absence of facts which would contradict a particular representation and warranty
of the Company.

     Section 8.13 Consent to Jurisdiction. Each of the parties to this Agreement
consents to submit to the personal  jurisdiction  of any state or federal  court
sitting in the State of Delaware,  in any action or proceeding arising out of or
relating to this  Agreement,  agrees that all claims in respect of the action or
proceeding  may be heard and  determined  in any such  court,  and agrees not to
bring any action or proceeding  arising out of or relating to this  Agreement in
any other court.  Each of the parties to this Agreement  agrees not to assert in
any action or  proceeding  arising out of relating  to this  Agreement  that the
venue  is  improper,  and  waives  any  defense  of  inconvenient  forum  to the
maintenance  of any action or proceeding so brought and waives any bond,  surety
or other  security  that  might be  required  of any other  party  with  respect
thereto.

     Section 8.14  Governing  Law.  THIS  AGREEMENT  AND THE COMPANY  DISCLOSURE
LETTER WILL BE  GOVERNED BY AND  CONSTRUED  IN  ACCORDANCE  WITH THE LAWS OF THE
STATE OF DELAWARE, without giving Effect to Any LAW OR RULE THAT WOULD CAUSE THE
LAWS OF ANY JURISDICTION OTHER THAN THE STATE OF DELAWARE TO BE APPLIED.

     Section 8.15 Disclosure.  Notwithstanding  anything to the contrary in this
Agreement or the Company Disclosure Letter, (i) the disclosure of information in
the  Company  SEC  Documents  will  constitute  disclosure  for  purposes of the
provisions  of Article  III only to the  extent  that the  significance  of such
information is apparent based solely on the disclosure contained in such Company
SEC  Document,  and (ii)  information  disclosed in a particular  section of the
Company  Disclosure  Letter  will not be deemed to have been  disclosed  for any
other


                                       48
<PAGE>

sections or purposes of this  Agreement.  The mere  disclosure  or listing of an
agreement, item, matter,  circumstance,  condition,  property or individual will
not be sufficient to disclose a breach, violation, dispute, claim or any similar
condition or circumstance relating thereto.

                                     * * * *


                                       49
<PAGE>

     IN WITNESS  WHEREOF,  the parties  hereto have executed and delivered  this
Agreement on the date first written above.

                                        GENERAL DYNAMICS CORPORATION

                                        By /s/ Arthur D. Veitch
                                           -------------------------------------
                                           Arthur D. Veitch
                                           Executive Vice President


                                        ATHENA ACQUISITION I CORPORATION

                                        By /s/ Arthur D. Veitch
                                           -------------------------------------
                                               Arthur D. Veitch
                                               President


                                        ADVANCED TECHNICAL PRODUCTS, INC.

                                        By /s/ Garrett L. Dominy
                                           -------------------------------------
                                           Garett L. Dominy
                                           President and Chief Executive Officer


                                       50

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.1
<SEQUENCE>4
<FILENAME>d50539_ex99-1.txt
<DESCRIPTION>PRESS RELEASE
<TEXT>
                                                                    Exhibit 99.1

          ADVANCED TECHNICAL PRODUCTS, INC. TO BE PURCHASED BY GENERAL
                           DYNAMICS FOR $250 MILLION

ROSWELL,  GA, May 2, 2002 - General Dynamics (NYSE:  GD) and Advanced  Technical
Products,  Inc.  (NASDAQ:  ATPX) today  entered into a definitive  agreement for
General  Dynamics to acquire  all 5.89  million  outstanding  shares of Advanced
Technical  Products  (ATP) for a cash  purchase  price of $33.50 per  share.  In
addition, General Dynamics would assume approximately $36.2 million of ATP's net
debt and retire  approximately $16.2 million in ATP stock options,  bringing the
transaction's  value to  approximately  $250 million.  The acquisition  would be
immediately  accretive to General  Dynamics'  earnings.  ATP closed at $28.53 in
yesterday's trading.

The  proposed  transaction,  unanimously  approved by the boards of directors of
both  companies,  is subject to ATP  shareholder  and  regulatory  approval  and
customary closing conditions.  It is expected to be completed within the next 60
days.  Upon  completion  of the  acquisition,  ATP will  become  part of General
Dynamics  Armament  Systems,  and the  combined  entity will be known as General
Dynamics Armament and Technical Products.

The purchase of ATP gives General Dynamics a strong  technology  position on key
programs aligned with homeland defense and DoD transformation  initiatives.  ATP
is an industry leader in composites technology and production;  Armament Systems
is an industry  leader in  integrated  armament  products for air,  land and sea
platforms.

"Although  we make  different  products,  our  companies  serve many of the same
customers and have highly complementary technologies.  The combined organization
will be able to expand into new growth markets," said Linda Hudson, president of
General Dynamics Armament Systems.  When the transaction closes,  Hudson will be
the president of General Dynamics Armament and Technical Products.

General Dynamics  Armament Systems provides a broad range of armament  solutions
for the full range of military applications.  The company designs,  develops and
produces  complete  armament  systems  for  warfighters,  fixed and rotary  wing
aircraft, land vehicles and sea-based platforms.  In addition,  Armament Systems
provides system management for several key DoD programs,  including the Hydra-70
2.75 inch rocket system. More information about Armament Systems can be found on
the World Wide Web at www.gdarm.com.

General  Dynamics,  headquartered in Falls Church,  Va.,  employs  approximately
52,000 people  worldwide  and had 2001 revenues of $12 billion.  The company has
leading market positions in land and amphibious combat systems, mission-critical
information  systems and  technologies,  shipbuilding  and marine  systems,  and
business aviation.  More information about the company can be found on the World
Wide Web at www.generaldynamics.com.

Advanced  Technical  Products,  headquartered  in  Roswell,  Georgia,  has  four
operating  divisions  (Marion,  VA; Lincoln,  NE; DeLand, FL; and Glen Cove, NY)
employing  more than 1,400 people.  ATP  manufactures  advanced  composite-based
products using several manufacturing capabilities

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including:  autoclave lamination,  filament winding,  resin transfer molding and
metal  bonding.  These  products  are on board many U.S.  fighter  aircraft  and
helicopters.  ATP is also a leader in the development and production of portable
biological and chemical  detection  systems,  tactical  deception  equipment and
mobile shelter systems.  More information about Advanced  Technical Products can
be found on the World Wide Web at www.atpx.com.

IMPORTANT LEGAL  INFORMATION:  Investors and security  holders are urged to read
the proxy statement regarding the proposed transaction when it becomes available
because it will contain important information. The proxy statement will be filed
with the U.S.  Securities and Exchange  Commission by ATP, and security  holders
may obtain a free copy of the proxy  statement  when it becomes  available,  and
other  documents filed with the SEC by ATP, at the SEC's website at www.sec.gov.
The proxy statement, and other documents filed by ATP, may also be obtained free
by directing a request to Advanced Technical  Products,  Inc. at 200 Mansell Ct.
East, Suite 505, Roswell, Georgia 30076. Investors may obtain a detailed list of
names, affiliations and interests of participants in the solicitation of proxies
of ATP at the address set forth in the immediately preceding sentence.


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