KEVLIN CORP, DEFM14A, 1996-02-01

KEVLIN CORP
DEFM14A, 1996-02-01
ELECTRONIC COMPONENTS, NEC

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<PAGE> 1

SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )

Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:

/ / Preliminary Proxy Statement / / Confidential, for Use of
the Commission Only (as
permitted by
/X/ Definitive Proxy Statement Rule 14a-6(e)(2))
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to [SECTION] 240.14a-11(c) or
[SECTION] 204.14a-12

KEVLIN CORPORATION
---------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)

KEVLIN CORPORATION
---------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement)

Payment of Filing Fee (Check the appropriate box):
/ / $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(j)(2).
/ / $500 per each party to the controversy pursuant to Exchange Act
Rule 14a-6(i)(3).
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.

1) Title of each class of Securities to which transaction applies:
Common Stock, $.10 par value
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2) Aggregate number of securities to which transaction applies:
3,123,729 shares
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3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11:
$4.54
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4) Proposed maximum aggregate value of transaction:
$14,181,730
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5) Total fee paid:
$2,836.35
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/X/ Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.

1) Amount Previously Paid:

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2) Form, Schedule or Registration Statement No.:

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3) Filing Party:

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4) Date Filed:

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<PAGE> 2
KEVLIN CORPORATION
5 CORNELL PLACE
WILMINGTON, MASSACHUSETTS 01887

February 5, 1996

Dear Stockholder:

You are cordially invited to attend a special meeting of stockholders
to be held at 10:00 a.m., Eastern Time on March 7, 1996 at the offices of
Kevlin at the address set forth above.

At this meeting, you will be asked to approve the proposed merger of Kevlin
into a subsidiary of Chelton Communications Systems, Inc. ("Chelton"). Chelton
is a Delaware corporation engaged in the manufacture and sale of microwave
waveguides and assorted electronics for application in radar and communication
systems. If the merger is consummated, Kevlin will become a wholly-owned
subsidiary of Chelton and Kevlin stockholders will receive $4.54 in cash for
each share of Kevlin Common Stock.

Details about the proposed merger are included in the attached Proxy
Statement. I urge you to read these materials carefully. Approval of this
important matter will require the affirmative vote of the holders of two-thirds
of the common stock of Kevlin outstanding on January 16, 1996, the record date
for the special meeting.

Your Board of Directors believes that the merger is in the best interests of
the stockholders of Kevlin and has unanimously approved the merger. In
arriving at its decision, your Board of Directors carefully evaluated the
consideration to be received by Kevlin's stockholders in the merger as a means
of maximizing stockholder value.

We appreciate the loyalty and support our stockholders have demonstrated over
the years. We hope that you will continue this support by voting FOR the
proposal now. I intend to vote FOR the proposal, and recommend that all
stockholders do the same. Regardless of the number of shares you may own, it
is important that your shares be represented at the meeting. Accordingly,
please promptly sign and return your proxy card in the envelope provided
whether or not you plan to attend the meeting. If you attend the meeting, you
may vote in person whether or not you have previously returned your proxy.

Sincerely,

Jonathan D. Donaldson
Chairman of the Board

NOTE: PLEASE DO NOT SEND IN YOUR STOCK CERTIFICATES AT THE PRESENT TIME.

<PAGE> 3
KEVLIN CORPORATION
5 CORNELL PLACE
WILMINGTON, MASSACHUSETTS 01887
(508) 657-3900

NOTICE OF SPECIAL MEETING OF STOCKHOLDERS
TO BE HELD ON MARCH 7, 1996

A Special Meeting of Stockholders of Kevlin Corporation ("Kevlin" or the
"Company"), will be held on March 7, 1996, at 10:00 a.m. Eastern Time, at
the offices of Kevlin, 5 Cornell Place, Wilmington, Massachusetts, for the
following purposes:

(1) To consider and vote upon a proposal to approve and adopt the Agreement
and Plan of Merger dated as of December 6, 1995, as amended (the "Merger
Agreement") among Chelton Communications Systems, Inc. ("Chelton"), Kevlin
Acquisition Corp., a wholly-owned subsidiary of Chelton, and the Company;
and

(2) To transact such other business as may properly come before the meeting or
any adjournment thereof.

The Board of Directors has fixed the close of business on January 16, 1996,
as the record date for determining the stockholders entitled to notice of and
to vote at the meeting and any adjournment thereof; only stockholders of record
at the close of business on that date will be entitled to vote.

If the Merger Agreement is approved by the stockholders at the meeting and
effected by the Company, any stockholder (1) who files with the Company before
the taking of the vote on the approval of the Merger Agreement, written
objection to the proposed action stating that such stockholder intends to
demand payment for his shares if the action is taken and (2) whose shares are
not voted in favor of the Merger has or may have a right to demand in writing
from the Company, within twenty days after the date of mailing to him of notice
in writing that the Merger has become effective, payment for his shares and an
appraisal of the value thereof. The Company and any such stockholder shall in
such cases have the rights and duties and shall follow the procedure set forth
in Sections 88 to 98 inclusive, of chapter 156B of the General Laws of
Massachusetts.

A proxy, which is solicited on behalf of the Board of Directors, is enclosed,
together with a return envelope which requires no postage if mailed in the
United States. The affirmative vote of at least two-thirds of the outstanding
shares entitled to vote is required to approve the Merger Agreement. It is
important that your shares be represented at the meeting. WHETHER OR NOT YOU
PLAN TO ATTEND THE MEETING, YOU ARE REQUESTED TO INDICATE YOUR VOTING
DIRECTIONS, SIGN, DATE, AND PROMPTLY RETURN YOUR PROXY IN THE ENCLOSED POSTPAID
ENVELOPE. IF YOU LATER DESIRE TO REVOKE YOUR PROXY, YOU MAY DO SO AT ANY TIME
BEFORE THE VOTING BY GIVING WRITTEN NOTICE OF REVOCATION TO THE CLERK OF THE
CORPORATION, OR BY GIVING ORAL NOTICE TO THE PRESIDING OFFICER DURING THE
MEETING.

BY ORDER OF THE BOARD OF DIRECTORS

Jonathan D. Donaldson
Chairman of the Board

Wilmington, Massachusetts
February 5, 1996
<PAGE> 4
KEVLIN CORPORATION
5 CORNELL PLACE
WILMINGTON, MASSACHUSETTS 01887

PROXY STATEMENT

FOR A SPECIAL MEETING OF STOCKHOLDERS
TO BE HELD ON MARCH 7, 1996

This Proxy Statement (the "Proxy Statement") relates to the proposed
acquisition of Kevlin Corporation ("Kevlin"), a Massachusetts corporation, by
Chelton Communications Systems, Inc. ("Chelton"), a Delaware corporation,
pursuant to the terms of an Agreement and Plan of Merger, dated as of December
6, 1995 (the "Merger Agreement"). It is being furnished to stockholders of
Kevlin in connection with the solicitation of proxies by the Board of Directors
of Kevlin for the special meeting of stockholders to be held on March 7, 1996 at
10:00 a.m., at the offices of Kevlin and any adjournments or postponements
thereof (the "Special Meeting"). Only stockholders of record at the close of
business on January 16, 1996 (the "Record Date") will be entitled to vote at the
Special Meeting. This Proxy Statement and the enclosed form of proxy are first
being mailed or delivered to stockholders on or about February 5, 1996.

At the Special Meeting, Kevlin will present a proposal to adopt the Merger
Agreement. If the Merger Agreement is adopted and the other conditions set
forth in the Merger Agreement are satisfied, Kevlin Acquisition Corp.
("Newco"), a wholly-owned subsidiary of Chelton, will be merged with and into
Kevlin (the "Merger"), with the result that Kevlin will become a wholly-owned
subsidiary of Chelton. Each outstanding share of the common stock, $0.10 par
value, of Kevlin (the "Common Stock"), other than shares as to which appraisal
rights have been perfected under Section 85 of the Massachusetts General
Corporation Law, will be converted into the right to receive $4.54 in cash (the
"Merger Consideration").

Under Massachusetts law, Kevlin stockholders have certain dissenters' rights
of appraisal in connection with the Merger. See "The Acquisition - Kevlin
Stockholder Appraisal Rights."

On the Record Date, Kevlin had outstanding 2,733,794 shares of Common Stock,
which is its only outstanding class of capital stock. Each share of Common
Stock is entitled to one vote for each matter submitted to a vote at the
Special Meeting. A majority in interest of the outstanding Common Stock,
represented at the Special Meeting in person or by proxy, constitutes a quorum
for the transaction of business. The affirmative vote in favor of adopting the
Merger Agreement by two-thirds of the outstanding Common Stock is a condition
to both Kevlin's and Chelton's obligation to consummate the Merger.

The authority granted by an executed proxy may be revoked at any time before
its exercise by filing with the Clerk of Kevlin a written revocation or a duly
executed proxy bearing a later date or by voting in person at the Special
Meeting. Shares represented by valid proxies will be voted in accordance with
the specifications in the proxies. If no specifications are made, the proxies
will be voted to approve the proposals set forth in the proxy.

The date of this Proxy Statement is February 5, 1996, and it is first being
mailed or delivered to Kevlin stockholders on or about that date.

<PAGE> 5

INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE

The following documents heretofore filed by Kevlin with the Commission (File
No. 0-10265) under the Exchange Act are incorporated by reference herein,
except as superseded or modified herein:

(1) Kevlin's annual report on Form 10-K for the year ended May 31, 1995,
filed with the Commission on August 21, 1995.

(2) Kevlin's quarterly reports on Form 10-Q for the quarters ended August
31, 1995 and November 30, 1995, filed with the Commission on October 4,
1995 and January 15, 1996, respectively.

(3) Kevlin's current reports on Form 8-K dated October 13, 1995 and December
6, 1995, filed electronically with the Commission on January 22, 1996 and
December 18, 1995, respectively.
Any statement contained in a document incorporated or deemed to be
incorporated herein by reference shall be deemed to be modified or superseded
for purposes hereof to the extent that a statement contained herein (or in any
other subsequently filed document which also is or is deemed to be incorporated
herein by reference) modifies or supersedes such statement. Any statement so
modified or superseded shall not be deemed, except as so modified or
superseded, to constitute a part of this Proxy Statement.

THIS PROXY STATEMENT INCORPORATES BY REFERENCE DOCUMENTS OF KEVLIN WHICH ARE
NOT PRESENTED HEREIN OR DELIVERED HEREWITH. COPIES OF SUCH DOCUMENTS WHICH
RELATE TO KEVLIN (NOT INCLUDING EXHIBITS THERETO, UNLESS SUCH EXHIBITS ARE
SPECIFICALLY INCORPORATED BY REFERENCE IN THE INFORMATION INCORPORATED HEREIN
BY REFERENCE) ARE AVAILABLE WITHOUT CHARGE TO EACH PERSON TO WHOM A COPY OF
THIS PROXY STATEMENT IS DELIVERED, UPON WRITTEN OR ORAL REQUEST, FROM TIMOTHY
R. OAKES AT THE EXECUTIVE OFFICES OF KEVLIN, 5 CORNELL PLACE, WILMINGTON,
MASSACHUSETTS 01887 (TELEPHONE (508) 657-3900). IN ORDER TO ENSURE TIMELY
DELIVERY OF THESE DOCUMENTS, ANY REQUEST SHOULD BE MADE BY FEBRUARY 23, 1996.
<PAGE> 6
TABLE OF CONTENTS
<TABLE>
<S> <C>
SUMMARY........................................................ 5
The Parties.................................................. 5
Chelton................................................... 5
Kevlin Acquisition Corp................................... 5
Kevlin.................................................... 5
Corporate Actions............................................ 5
Newco Stockholder Consent................................. 5
Special Meeting........................................... 5
The Acquisition.............................................. 6
Merger.................................................... 6
Payment for Kevlin Securities............................. 6
Treatment of Options...................................... 6
Market for Kevlin Shares.................................. 7
Reasons for the Acquisition............................... 7
Recommendation of the Board of Directors of Kevlin........ 7
Interest of Certain Persons in the Matter to be Acted Upon 8
Covenants................................................. 8
Conditions of Merger; Termination......................... 8
Breakup and Termination Fees.............................. 8
Accounting Treatment...................................... 8
Certain Federal Income Tax Consequences................... 9
Appraisal Rights.......................................... 9
Selected Financial Data of Kevlin............................ 10

INTRODUCTION................................................... 11

CORPORATE ACTIONS.............................................. 11
Newco Stockholder Consent.................................... 11
Kevlin Stockholder Meeting................................... 11

THE ACQUISITION................................................ 12
Principal Terms.............................................. 12
Background of the Acquisition................................ 13
Kevlin's Reasons for the Acquisition......................... 13
Merger and Effective Time.................................... 14
Conversion of Kevlin Common Stock............................ 14
Treatment of Options......................................... 14
Surrender of Certificates.................................... 15
Interest of Certain Persons in the Matter to be Acted Upon... 15
Representations, Warranties and Covenants.................... 16
Conditions of Merger......................................... 17
Termination.................................................. 17
Waiver and Amendment......................................... 17
Breakup and Termination Fees; No Solicitation................ 18
Expenses..................................................... 18
Regulatory Matters........................................... 18
Accounting Treatment......................................... 18
Certain Federal Income Tax Consequences...................... 18

</TABLE>
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<TABLE>
<S> <C>
Kevlin Stockholder Appraisal Rights.......................... 19

KEVLIN CORPORATION SUBSEQUENT EVENTS........................... 20

SECURITIES BENEFICIALLY OWNED BY PRINCIPAL STOCKHOLDERS AND
MANAGEMENT................................................... 21

Shares Held by the ESOP...................................... 22

SOLICITATION COMPENSATION...................................... 22

OTHER MATTERS.................................................. 22

ACCOMPANYING KEVLIN REPORTS.................................... 22

STOCKHOLDER PROPOSALS.......................................... 22

EXHIBIT A - Agreement and Plan of Merger.......................A-1
EXHIBIT B - Sections 85 to 98 of the Massachusetts Business
Corporation Law....................................B-1

</TABLE>

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<PAGE> 8

SUMMARY

The following summary is qualified in its entirety by reference to the more
detailed information contained elsewhere in this Proxy Statement, including the
exhibits hereto. You are urged to read this Proxy Statement, the Merger
Agreement, which is attached hereto as Exhibit A and incorporated herein by
reference, and the other exhibits attached hereto, in their entirety.
Cross-references in this summary are to captions in this Proxy Statement.

THE PARTIES

CHELTON

Chelton is a Delaware corporation which, through its subsidiaries, designs,
manufactures and markets (i) a wide range of microwave components and
subsystems primarily for use on sophisticated ground and airborne surveillance
radar applications and (ii) airborne and ground antennas and associated
products. Chelton is owned (through subsidiaries) by Cobham plc, an English
company listed on the London Stock Exchange that is engaged in the design,
manufacture and sale of various equipment, specialized systems and components
used in the aerospace, defense, energy and electronic industries.

Chelton's executive offices are located at 179 Avenue of the Commons, Suite
One, Shrewsbury, New Jersey 07702. Its telephone number is (908) 935-9518.

KEVLIN ACQUISITION CORP.

Kevlin Acquisition Corp. ("Newco") is a wholly-owned subsidiary of Chelton
incorporated in Massachusetts in 1995 for the sole purpose of effecting the
Merger. Newco's executive offices are located at 179 Avenue of the Commons,
Suite One, Shrewsbury, New Jersey 07702. Its telephone number is (908)
935-9518.

KEVLIN

Kevlin designs, manufactures and sells microwave components and subsystems.
These products are used in radar systems by domestic and foreign customers,
representing commercial, air traffic control and defense industries. Kevlin's
principal executive offices are located at 5 Cornell Place, Wilmington,
Massachusetts 01887. Its telephone number is (508) 657-3900.

CORPORATE ACTIONS

NEWCO STOCKHOLDER CONSENT

Chelton, as the holder of all of the outstanding shares of common stock of
Newco, intends to approve the Merger by written consent. The written consent
will constitute the corporate action required under Massachusetts law.

SPECIAL MEETING

Time, Place and Purpose. The Special Meeting will be held on March 7,
1996, at 10:00 a.m. Eastern Time, at the offices of Kevlin, 5 Cornell Place,
Wilmington, Massachusetts 01887. At the Special Meeting, the stockholders of
Kevlin will be asked to approve and adopt the Merger Agreement.

Required Vote. The affirmative vote of the holders of two-thirds of the
shares of Kevlin Common Stock outstanding as of the Record Date (as defined
below) is required to approve and adopt the Merger Agreement. Such approval
and adoption is a condition to consummation of the Merger. Votes withheld,
abstentions and broker non-votes (where a broker or nominee does not exercise
discretionary authority to vote on a matter) are counted for purposes of
determining the presence or absence of a quorum for the transaction of
business, but, since the affirmative

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<PAGE> 9
vote of two-thirds of outstanding shares is required to approve the Merger
Agreement, such actions will have the effect of a negative vote. See
"Corporate Actions - Kevlin Stockholder Meeting." The officers and directors
of Kevlin and their affiliates hold shares of Kevlin Common Stock representing
approximately 18.7% of the outstanding shares of Kevlin Common Stock
(excluding shares which such persons have the right to acquire upon the
exercise of stock options).

Record Date and Stockholder Information. The Board of Directors of Kevlin
has fixed the close of business on January 16, 1996 as the record date for
determining stockholders entitled to notice of and to vote at the Special
Meeting (the "Record Date"). At the close of business on the Record Date,
2,733,794 shares of Kevlin Common Stock were outstanding. The directors and
executive officers of Chelton beneficially own no shares of Kevlin Common
Stock, and Chelton and its subsidiaries own no such shares. The directors and
executive officers of Kevlin and their affiliates own no shares of the common
stock of Cobham plc. There are no related-party affiliations among Cobham plc
and Chelton and the Company. See "Corporate Actions - Kevlin Stockholder
Meeting."
THE ACQUISITION

MERGER

This Proxy Statement relates to the proposed acquisition of Kevlin by Chelton
to be effected by the Merger of Newco with and into Kevlin. In the Merger,
each share of Kevlin Common Stock outstanding as of the Effective Time, as
defined below, will be converted into the right to receive $4.54 in cash. Upon
consummation of the Merger, Kevlin will be the surviving corporation in the
Merger (the "Surviving Corporation") and will conduct the business of Kevlin as
a wholly-owned subsidiary of Chelton.

The Merger will become effective as soon as practicable after satisfaction or
waiver of all conditions to the Merger and at the time and on the date Articles
of Merger are duly filed with the Secretary of the Commonwealth of
Massachusetts, or at such later time and date as is specified as the effective
time of the Merger therein (the "Effective Time"). See "The Acquisition -
Merger and Effective Time." Assuming all conditions to the Merger are met, or
waived where permissible, it is expected that the Effective Time will occur on
March 7, 1996, or as soon thereafter as practicable.

PAYMENT FOR KEVLIN SECURITIES

As a result of the Merger, at the Effective Time all outstanding shares of
Kevlin Common Stock (other than shares of holders who perfect dissenters'
rights under Massachusetts law ("Kevlin Dissenting Shares"), and shares held by
any subsidiary of Kevlin) will be converted into the right to receive $4.54 in
cash (the "Merger Consideration").

TREATMENT OF OPTIONS

Chelton's obligations under the Merger Agreement are conditioned upon, among
other things, all outstanding options to purchase shares of Kevlin Common Stock
being exercised or terminated at or prior to the closing of the Merger.
Holders of such options will be permitted, prior to the termination of the
option, to pay the exercise price of the option with shares of Common Stock
acquired on exercise. The effect of this will be to permit the optionholder,
upon consummation of the Merger, to receive an amount of cash equal to the
difference between the exercise price of the option and the Merger
Consideration without the need to make any significant cash investment to
exercise the options. See "The Acquisition - Treatment of Options" and
"-Interest of Certain Persons in the Matter to be Acted Upon."

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MARKET FOR KEVLIN SHARES

Kevlin Common Stock is listed on Nasdaq and designated a Nasdaq National
Market security, trading under the symbol "KVLM". On October 11, 1995, the
last trading day prior to the first public announcement of the agreement for
the Merger, the high and low sale prices of Kevlin Common Stock as reported by
Nasdaq were $4.125 and $4.00, and the closing sale price on such date was
$4.00. Upon the consummation of the Merger, Kevlin will cease to be a company
whose stock is registered under Section 12 of the Securities Exchange Act of
1934 (the "Exchange Act") and will, therefore, no longer be subject to the
reporting requirements of the Exchange Act.

REASONS FOR THE ACQUISITION

CHELTON

Chelton believes that Kevlin's development and sales of rotary couplers for
military and commercial radars and air traffic control ("ATC") systems is a
natural extension of Chelton's air and ground antenna and microwave product
lines. Kevlin's defense, ATC and international markets are well known to
Chelton, and Chelton believes that a synergy will be obtained through combined
sales and marketing efforts, especially in the international arena.

KEVLIN

The Board of Directors of Kevlin has unanimously approved the Merger
Agreement and the transactions contemplated thereby and recommends that the
stockholders of Kevlin vote in favor of the adoption of the Merger Agreement.

In evaluating the transaction, the Kevlin Board of Directors was furnished
with and considered the most recent financial statements of Kevlin, reports
from management on management's plans for expansion into additional related
testing markets and reports regarding Kevlin's future financing needs. After
considering the available alternatives and the immediate and foreseeable
prospects for Kevlin, the Board of Directors of Kevlin concluded that the
Merger is in the best interests of the stockholders of Kevlin, that the Merger
offers the greatest immediate and long-term value to the stockholders and that
the Merger provides the best prospect to serve the needs of each other
constituency of Kevlin, including its employees and customers. Specifically,
the Board of Directors concluded that (i) the Merger enhances stockholder value
and liquidity by providing a Merger Consideration that is 182% higher than the
price of the Kevlin Common Stock at the end of fiscal 1995, (ii) the Merger
would enable Kevlin to expand strategically its global presence and diversify
into other markets by combining Kevlin's sales organization with the world-wide
organization of Chelton, and (iii) the Merger has the potential to improve
Kevlin's operational capabilities through Kevlin's association with Chelton and
its affiliates and their management team, additional capital resources and
manufacturing facilities and capabilities. See "The Acquisition - Kevlin's
Reasons for the Acquisition."

RECOMMENDATION OF THE BOARD OF DIRECTORS OF KEVLIN

THE BOARD OF DIRECTORS OF KEVLIN UNANIMOUSLY RECOMMENDS THAT THE KEVLIN
STOCKHOLDERS VOTE THEIR SHARES OF KEVLIN COMMON STOCK IN FAVOR OF APPROVAL AND
ADOPTION OF THE MERGER AGREEMENT.

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<PAGE> 11
INTEREST OF CERTAIN PERSONS IN THE MATTER TO BE ACTED UPON

In connection with the Merger, the Board of Directors of Kevlin has approved
a payment, upon the completion of the Merger, to each of the Company's
non-employee directors (Jonathan Donaldson, Howard Mileaf and Carmine Vittoria)
of a specified percentage of the aggregate amount calculated by the application
of the so-called "Lehman Formula" to the aggregate Merger Consideration.
Consequently, if the Merger is completed, Messrs. Donaldson, Mileaf and
Vittoria will receive $215,068, $30,724 and $10,241, respectively, or 84%, 12%
and 4%, respectively, of an aggregate amount of $256,033. In addition, Messrs.
Bandrowski, Moran, Peters, Ricci and Williams are parties to executive
severance agreements with the Company that contain "change in control"
provisions. See "The Acquisition - Interest of Certain Persons in the Matter to
be Acted Upon."

COVENANTS

Kevlin and Chelton have made certain covenants and agreements with each other
in the Merger Agreement relating to, among other things, (i) the conduct of
Kevlin's business, (ii) access to information, (iii) obtaining necessary
consents, and (iv) the preparation of this Proxy Statement and other matters.
Kevlin has also agreed that it will not enter into negotiations with or solicit
offers from third parties regarding a potential acquisition of Kevlin, and will
notify Chelton promptly of any such offer received by either of them. See "The
Acquisition - Representations, Warranties and Covenants."

CONDITIONS OF MERGER; TERMINATION

In addition to the approval of the Merger Agreement by the stockholders of
Kevlin, the respective obligations of Chelton and Kevlin to consummate the
Merger are subject to certain conditions, including that (i) all
representations and warranties contained in the Merger Agreement be correct as
of the Effective Time; (ii) certain covenants and agreements contained in the
Merger Agreement have been performed or waived prior to the Effective Time;
(iii) the parties have received the legal opinions and other documents
described in the Merger Agreement; (iv) the absence of litigation against
Kevlin or Chelton with respect to the Merger; and (v) the receipt of all
necessary consents to the Merger. See "The Acquisition - Conditions of
Merger."

The Merger Agreement may be terminated prior to the Effective Time under
certain circumstances, including at the election of the Board of Directors of
Kevlin or Chelton on or after March 31, 1996 if any of the conditions to its
obligation to consummate the Merger has not been fulfilled (provided that the
terminating party is not in material breach of its representation, warranties
or obligation under the Merger Agreement). Either Kevlin or Chelton may be
obligated, upon a termination of the Merger Agreement under certain
circumstances, to reimburse the other party up to $150,000 for expenses
incurred in connection with the Merger. See "The Acquisition - Termination."

BREAKUP AND TERMINATION FEES

If, prior to termination of the Merger Agreement, certain events occur which
could preclude the Merger, Chelton may be obligated to pay a fee of $1,000,000
(the "Breakup Fee") to Kevlin. Upon termination, Kevlin may under certain
circumstances, be obligated to pay a fee of $1,000,000 (the "Termination Fee")
to Chelton. See "The Acquisition - Breakup and Termination Fees; No
Solicitation."

ACCOUNTING TREATMENT

If the Merger is consummated, Chelton expects to account for the Merger using
the purchase method of accounting.

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CERTAIN FEDERAL INCOME TAX CONSEQUENCES

The Merger will be treated as a taxable sale of the Kevlin Common Stock.
Kevlin stockholders will be treated as if they sold their shares in a fully
taxable transaction for the cash they will receive. See "The Acquisition -
Certain Federal Income Tax Consequences."

APPRAISAL RIGHTS

The Massachusetts Business Corporation Law (the "MBCL") gives Kevlin's
stockholders the right to dissent from the Merger. Kevlin stockholders who
dissent from the Merger in accordance with the MBCL have the right to be paid
the "fair value" of their shares as of the date preceding the Special Meeting
(excluding any appreciation or depreciation in anticipation of the Merger). In
order to exercise these appraisal rights, a Kevlin stockholder must file a
written objection to the Merger with Kevlin prior to the taking of the vote
thereon, must not vote in favor of the Merger and must follow the other
procedures described by the MBCL. See "The Acquisition - Kevlin Stockholder
Appraisal Rights."

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<TABLE>
SELECTED FINANCIAL DATA OF KEVLIN

The selected financial data set forth below for Kevlin as of and for each of the fiscal years ended May 31 are derived from
the audited financial statements of the Company. The summary financial data set forth below for Kevlin as of and for the six
month periods ended November 30, 1995 and 1994 are derived from its unaudited financial statements, which in the opinion of
management of Kevlin contain all adjustments necessary for the fair presentation of this information.

<CAPTION>
Six Months Ended
Fiscal Year Ended May 31, November 30, November 30,
---------------------------------------------------------------- --------------------------
1995 1994 1993 1992 1991 1995 1994
---- ---- ---- ---- ---- ---- ----
(Amounts in thousands, except per share and share data)
<S> <C> <C> <C> <C> <C> <C> <C>
Total sales........................ $ 11,065 $ 10,679 $ 10,541 $ 10,354 $ 9,346 $ 5,185 $ 5,580
Income from continuing operations.. 552 340 425 858 505 (831) 304
Net income (loss).................. 552 (1,430) 122 620 554 (831) 304
Income from continuing operations
per share....................... 0.19 0.12 0.15 0.30 0.18 (0.28) 0.11
Net income (loss) per share....... $ 0.19 $ (0.52) $ 0.04 $ 0.22 $ 0.20 $ (0.28) $ 0.11
========== ========== ========== ========== ========== ========== ==========
Common and common equivalent
shares outstanding............. 2,857,336 2,765,099 2,798,632 2,835,202 2,789,345 3,006,507 2,864,780
========== ========== ========== ========== ========== ========== ==========

Financial Ratios at End of Period:
Return on (based on income from
continuing operations):
Sales......................... 5.0% 3.2% 4.0% 8.3% 5.4% (16.0%) 5.4%
Period end Assets............. 5.0% 3.4% 3.8% 8.5% 5.4% (8.0%) 3.1%
Period end equity............. 7.2% 4.9% 5.0% 10.3% 6.7% (12.1%) 4.1%

Financial Positions at End of Period:
Working capital................ $ 6,831 $ 6,473 $ 4,831 $ 5,523 $ 5,674 $ 6,090 $ 6,801
Total assets................... 11,084 9,868 11,085 10,126 9,379 10,394 9,804
Stockholders' equity........... 7,632 7,000 8,476 8,299 7,527 6,863 7,358
Stockholders' equity per
common share................ $ 2.83 $ 2.64 $ 3.16 $ 3.13 $ 2.95 $ 2.51 $ 2.74

Other Statistics:
New orders..................... $ 10,524 $ 11,704 $ 9,600 $ 8,746 $ 12,846 $ 4,002 $ 4,624
Backlog at end of period....... 7,264 7,789 6,765 7,706 9,314 6,071 6,854
Capital expenditures, net...... 144 220 372 98 127 81 93
Product development
expense..................... $ 289 $ 288 $ 398 $ 409 $ 189 $ 254 $ 150

</TABLE>
-10-
<PAGE> 14
INTRODUCTION

This Proxy Statement is being furnished to the stockholders of Kevlin in
connection with the solicitation of proxies by the Board of Directors of Kevlin
to be voted at the Special Meeting, and at any adjournment or postponement
thereof.

CORPORATE ACTIONS

NEWCO STOCKHOLDER CONSENT

In connection with the Merger, Chelton, as the holder of all the outstanding
shares of Newco common stock, has approved the Merger Agreement by written
consent. The written consent constitutes the required corporate action under
Massachusetts law.

KEVLIN STOCKHOLDER MEETING

THE SPECIAL MEETING. The Special Meeting will be held on March 7, 1996,
at 10:00 a.m. Eastern Time, at the offices of Kevlin, 5 Cornell Place,
Wilmington, Massachusetts 01887. The purpose of the Special Meeting is to
obtain stockholder approval with regard to the Merger Agreement. Each Kevlin
stockholder of record at the close of business on the Record Date will be
entitled to receive notice of and to vote at the Special Meeting. At that
date, there were 2,733,794 shares of Kevlin Common Stock outstanding
which were held of record by approximately 550 holders. Each share of Kevlin
Common Stock is entitled to one vote.

All proxies that are properly executed and returned, unless previously
revoked, will be voted at the Special Meeting in accordance with the
instructions thereon. With regard to any other business not specified above
that may properly come before the Special Meeting, shares represented by
properly executed proxies will be voted at the discretion of the persons named
in the relevant proxy. The execution of a proxy will not affect a
stockholder's right to attend the Special Meeting and vote in person.

REQUIRED VOTE. The affirmative vote of the holders of at least two-thirds
(2/3rds) of the outstanding Kevlin Common Stock is required to approve and
adopt the Merger Agreement. Votes withheld, abstentions and broker non-votes
(where a broker or nominee does not exercise discretionary authority to vote on
a matter) are counted for purposes of determining the presence or absence of a
quorum for the transaction of business, but, since the affirmative vote of
two-thirds of outstanding shares is required to approve the Merger Agreement,
such actions will have the effect of a negative vote. No vote of Chelton
stockholders is required, or will be sought, to consummate the transaction.

THE BOARD OF DIRECTORS OF KEVLIN HAS UNANIMOUSLY RECOMMENDED A VOTE IN FAVOR
OF THE MERGER AGREEMENT. See "Summary - Recommendation of the Board of
Directors of Kevlin," "The Acquisition - Background of the Acquisition" and
"The Acquisition - Kevlin's Reasons for the Acquisition."

PURPOSE OF THE MEETING. At the Special Meeting, the stockholders of Kevlin
will consider and vote upon the approval and adoption of the Merger Agreement
under which (i) the Merger and the other transactions contemplated by the
Merger Agreement are to be consummated, (ii) holders of Kevlin Common Stock are
to receive the Merger Consideration in exchange for the Kevlin Common Stock
held by each of them as of the Effective Time of the Merger, and (iii) Kevlin
is to become a wholly-owned subsidiary of Chelton. See "The Acquisition -
Merger and Effective Time," " - Conversion of Kevlin Common Stock" and " -
Treatment of Options."

The MBCL gives Kevlin's stockholders the right to dissent from the Merger.
Kevlin stockholders who dissent from the Merger in accordance with the MBCL
have the right to be paid the "fair value" of their shares as of the date
preceding the Kevlin Special Meeting (excluding any appreciation or
depreciation in anticipation of the Merger). In order to exercise these
appraisal rights under the MBCL, a Kevlin stockholder must file a written
objection to the

- 11 -
<PAGE> 15

Merger with Kevlin prior to the taking of the vote thereon, must not vote in
favor of the Merger and must follow the other procedures described by the MBCL.
See "The Acquisition - Kevlin Stockholder Appraisal Rights."

ANY KEVLIN STOCKHOLDER GIVING A PROXY HAS THE POWER TO REVOKE THE PROXY PRIOR
TO ITS EXERCISE. A PROXY MAY BE REVOKED BY (A) FILING WITH THE CLERK OF
KEVLIN, AT OR BEFORE THE TAKING OF THE VOTE AT THE KEVLIN SPECIAL MEETING, (1)
A WRITTEN NOTICE OF REVOCATION SPECIFYING THE NUMBER OF SHARES AND CLEARLY
IDENTIFYING THE PROXY TO BE REVOKED OR (2) DULY EXECUTING AND FILING A NEW
PROXY BEARING A LATER DATE, OR (B) ATTENDING THE SPECIAL MEETING AND VOTING IN
PERSON (ALTHOUGH ATTENDANCE AT THE MEETING WILL NOT IN AND OF ITSELF CONSTITUTE
A REVOCATION OF A PROXY). ANY WRITTEN NOTICE OF REVOCATION OR SUBSEQUENT PROXY
SHOULD BE SENT AND DELIVERED TO KEVLIN CORPORATION, 5 CORNELL PLACE,
WILMINGTON, MASSACHUSETTS 01887, ATTENTION: CLERK, OR HAND DELIVERED TO THE
CLERK OF KEVLIN AT OR BEFORE THE TAKING OF THE VOTE AT THE SPECIAL MEETING.

MISCELLANEOUS. The expenses of soliciting proxies for the Special Meeting
are to be paid by Kevlin. Solicitation of proxies may be made by means of
personal calls upon, or telephonic or telegraphic communications with,
stockholders or their personal representatives by Beacon Hill Partners, Inc.
who has been retained by Kevlin to assist in such solicitation. See
"Solicitation Compensation."

If you have any questions about giving your Kevlin proxy or require
assistance, please contact either of the following persons:

Timothy R. Oakes
Kevlin Corporation
5 Cornell Place
Wilmington, Massachusetts 01887
(508) 657-3900
or
Beacon Hill Partners, Inc.
90 Broad Street
New York, New York 10004
Attention: Mr. Edward McCarthy, Managing Director
(800) 755-5001
THE ACQUISITION

The detailed terms of and conditions to the consummation of the Merger are
contained in the Merger Agreement, a conformed copy of which is attached hereto
as Exhibit A and incorporated herein by reference. The following discussion
sets forth a description of the material terms and conditions of the Merger
Agreement. The description in this Proxy Statement of the terms and conditions
to the consummation of the Merger is qualified by, and made subject to, the
more complete information set forth in the Merger Agreement.

PRINCIPAL TERMS

The Merger Agreement provides for the merger of Newco, a wholly-owned
subsidiary of Chelton, with and into Kevlin. If the Merger Agreement is
approved and adopted by the stockholders of Kevlin, certain additional
conditions are satisfied or waived and the Merger is consummated, Kevlin will
be the Surviving Corporation in the merger with Newco and will conduct the
business of Kevlin as a wholly-owned subsidiary of Chelton.

- 12 -

<PAGE> 16

As a result of the Merger, at the Effective Time the Kevlin Common Stock then
outstanding will be converted as provided in the Merger Agreement into the
right to receive the Merger Consideration, which equals $4.54 per share of
Kevlin Common Stock. See "The Acquisition - Conversion of Kevlin Common
Stock."

For a description of the procedures for exchanging Kevlin Common Stock for
the Merger Consideration, see "The Acquisition - Surrender of Certificates."

BACKGROUND OF THE ACQUISITION

Beginning in July 1995, Kevlin began the process of entertaining bids from
potential acquirors. From August through October of 1995, Kevlin received a
series of competing bids from three companies, Schleifring und Apparatebau GmbH
("Schleifring"), Kaydon Corporation ("Kaydon") and Chelton, which bids ranged
from a bid made in September by Chelton of $3.80 per share of Kevlin Common
Stock to Chelton's bid in October of $4.68 per share of Kevlin Common Stock.
The terms of the offers received by the Company were substantially similar,
with the distinguishing feature of each of the offers being the per share
purchase price. In September 1995, Kevlin entered into a letter of intent with
Schleifring with a purchase price of $4.28 per share of Kevlin Common Stock.
Kevlin received a bid from Kaydon Corporation at a price of $4.50 per share of
Kevlin Common Stock a few days later, terminated the letter of intent with
Schleifring and entered into a letter of intent with Kaydon Corporation on
September 15, 1995. Subsequent to signing such letter of intent, Kevlin
received an offer from Chelton and, following discussions with Chelton, the
Company exercised its right under the letter of intent with Kaydon to terminate
upon payment of $300,000 and then entered into a letter of intent which was
signed on October 13, 1995 by Chelton and Kevlin (the "Letter of Intent"). In
determining to enter into the Letter of Intent, in addition to the higher bid
made by Chelton, the Board of Directors also considered the fact that Chelton
had recently acquired another company with a related product line that is
located near the Company, which, in the opinion of the Board of Directors,
created a synergistic opportunity.

In the Letter of Intent, Kevlin agreed to negotiate in good faith exclusively
with Chelton for a limited period with respect to the acquisition by Chelton of
Kevlin in exchange for $4.68 per share of Kevlin Common Stock. Chelton agreed
that it would pay Kevlin the Breakup Fee if the acquisition is not completed by
Chelton, except as a result of certain events, provided that Kevlin has adhered
to the terms of the Letter of Intent in all material respects. Further due
diligence activities and negotiations led to a reduction in the Merger
Consideration to $4.54 per share of Kevlin Common Stock, primarily due to
the fact that Kevlin's preliminary operating results for the fiscal quarter
ended November 30, 1995 and a preliminary evaluation of the gross margins for
such quarter indicated lower than historical margins. The parties signed the
Merger Agreement on December 6, 1995.

KEVLIN'S REASONS FOR THE ACQUISITION

First, the Merger enhances stockholder value and liquidity. The Merger
Consideration is 208% higher than the average price of the Kevlin Common Stock
over the last five fiscal years and 182% higher than the price of the Kevlin
Common Stock at the end of fiscal year 1995. In addition, the Merger
Consideration is higher than any other bid

- 13 -

<PAGE> 17
received by Kevlin, and, in the opinion of the Board of Directors, represents
the highest value for the Company that can currently be obtained. In view of
the competitive bid process described under "Background of the Acquisition"
above, the Board of Directors of the Company did not consider it necessary to
consider other transactions involving similar companies in evaluating the
adequacy of the Merger Consideration.

Second, the Board of Directors believes that the Merger would enable Kevlin
to expand strategically its global presence and diversify into other markets.
Kevlin's sales organization is strengthened by combining its existing network
with the world-wide organization of Chelton.

Finally, the Board of Directors believes that the Merger has the potential to
improve Kevlin's operational capabilities through Kevlin's association with
Chelton and its affiliates and their management team, additional capital
resources and manufacturing facilities and capabilities. In addition, the
benefit of a larger engineering team would enable the combined company to
develop more complex systems for continued growth in markets such as air
traffic control radars, satellite communications systems and commercial
positioning and mapping systems.

MERGER AND EFFECTIVE TIME

It is expected that the consummation of the transactions contemplated by the
Merger Agreement will take place on March 7, 1996 (the "Closing Date").

The date and time of the filing of the Articles of Merger with the Secretary
of the Commonwealth of Massachusetts, or such later time as specified therein,
shall be the Effective Time of the Merger. Kevlin and Chelton will cause the
Articles of Merger to be filed and recorded as soon as practicable on or after
the satisfaction or waiver of all conditions to the Merger. It is expected
that the Articles of Merger will be filed on the Closing Date.

CONVERSION OF KEVLIN COMMON STOCK

As a result of the Merger, at the Effective Time each outstanding share of
Kevlin Common Stock (other than shares of holders who perfect dissenters'
rights under Massachusetts law ("Kevlin Dissenting Shares"), and shares held by
any subsidiary of Kevlin) will be converted into the right to receive $4.54
(the "Merger Consideration").

TREATMENT OF OPTIONS

Chelton's obligations under the Merger Agreement are conditioned upon, among
other things, all outstanding options to purchase shares of Kevlin Common Stock
being exercised or terminated at or prior to the closing of the Merger.
Pursuant to the terms of the Company's 1990 Incentive Stock Option Plan, the
Company intends to notify each optionholder that all outstanding options will
be terminated at the Effective Time. Holders of all outstanding options
(including options granted under the Company's 1980 Stock Option Plan) will be
permitted, prior to the termination of the option, to exercise such options by
paying in cash only an amount necessary to acquire a number of shares of Common
Stock with a value equal to the exercise price for an additional exercise under
the option. Thereafter, additional exercises shall be made successively by the
exchange of shares with a value equal to the exercise price of the option, with
each additional exercise resulting in the issuance of additional shares, until
the option has been exercised in full. Such "pyramiding" transactions shall
occur simultaneously and shall result in the holder of an option receiving a
number of shares with a value equal to the difference between the aggregate
exercise price of all options held by such holder and the aggregate market
value of all shares receivable upon exercise. An optionholder will be
permitted to indicate that such option exercise is to be conditioned upon, and
occur immediately following, the satisfaction of all closing conditions for the
Merger, so that an option will not be exercised if the Merger does not occur.
The Closing of the Merger will occur immediately after the exercise of such
options. No stock certificates will be issued upon the exercise of the option,
but each optionholder who exercises his options will be a holder of record in
Kevlin's stock records and entitled to receive the appropriate Merger
Consideration in connection with the Merger. Upon the consummation of the
Merger and the payment of the Merger Consideration to all Kevlin stockholders
(including holders of shares of Kevlin Common Stock issued pursuant to the
exercise of options), each

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<PAGE> 18
person who had previously held options and exercised such options as
described above will have received an amount of cash equal to the difference
between the exercise price of the option and the Merger Consideration.

SURRENDER OF CERTIFICATES

The Paying Agent will exchange Kevlin Common Stock certificates for an amount
of cash into which each certificate represents the right to receive. As soon
as practicable after the Effective Time, the Paying Agent will mail to all
holders of record of Kevlin Common Stock at the Effective Time instructions for
surrendering their Kevlin Common Stock certificates in exchange for cash equal
to the Merger Consideration. KEVLIN STOCKHOLDERS ARE REQUESTED NOT TO
SURRENDER THEIR CERTIFICATES FOR EXCHANGE UNTIL THEY RECEIVE A LETTER OF
INSTRUCTIONS FROM THE PAYING AGENT. Upon surrender of a Kevlin Common Stock
certificate for cancellation to the Paying Agent, the holder of such
certificate shall be entitled to receive in exchange cash in an amount equal to
$4.54 for each share previously represented by such certificate. Surrendered
certificates shall forthwith be cancelled. Until surrendered, each Kevlin
Common Stock certificate shall represent for all purposes the right to receive
cash equal to the Merger Consideration. Any Kevlin Common Stock certificates
surrendered for exchange more than six months after the Effective Time must be
surrendered directly to the Surviving Corporation instead of the Paying Agent.

If any Merger Consideration is to be paid to a person other than the person
in whose name the Kevlin Common Stock certificate surrendered is registered, it
shall be a condition of such exchange that the person requesting such exchange
shall deliver to the Paying Agent all documents necessary to evidence and
effect such transfer and pay to the Paying Agent any transfer or other taxes
required by reason of the payment of the Merger Consideration to a person other
than that of the registered holder of the certificate surrendered or establish
to the satisfaction of the Paying Agent that such tax has been paid or is not
applicable.

At the Effective Time, the stock transfer books of Kevlin shall be closed and
no transfer of Kevlin Common Stock shall thereafter be made on those stock
transfer books.

INTEREST OF CERTAIN PERSONS IN THE MATTER TO BE ACTED UPON
In July 1995, the Board of Directors of Kevlin elected Jonathan Donaldson
Chairman of the Board of Directors and asked him to concentrate his efforts
toward exploring the opportunity of having the Company acquired in a manner as
to optimize stockholder value. At that time, the Board of Directors agreed
that Mr. Donaldson would be paid a salary for his efforts and a success fee in
an amount to be determined by the Board of Directors. In response, Mr.
Donaldson later formed a committee consisting of himself and the Company's two
other non-employee directors (Howard Mileaf and Carmine Vittoria) to serve as
advisors to the Company on this matter and to negotiate with potential
acquirors. In connection with the Merger, the Board of Directors of Kevlin has
approved a payment, upon the completion of the Merger, to each of the members of
this committee of a specified percentage of the aggregate amount calculated by
the application of the so-called "Lehman Formula" to the aggregate Merger
Consideration. The aggregate Merger Consideration is expected to be
$14,181,730, and the application of the Lehman Formula to this amount yields an
aggregate payment amount of $256,033. Mr. Donaldson requested that the payment
be shared among the members of the committee in proportion to the amount of
effort each person contributed to the goal. Consequently, if the Merger is
completed, Messrs. Donaldson, Mileaf and Vittoria will receive $215,068,
$30,724 and $10,241 respectively, or 84%, 12% and 4%, respectively, of the
aggregate amount to be paid. This payment was approved by the Board of
Directors to compensate these directors for the successful efforts undertaken
by them in connection with the Merger. Approval of such payments by Kevlin's
Board of Directors occurred prior to the Merger negotiations and, therefore,
may have created a conflict of interest for the non-employee directors in the
negotiation of the Merger Consideration and the approval of the Merger.

All persons who hold outstanding options to purchase shares of Kevlin Common
Stock, including officers, directors and affiliates of the Company, will be
permitted to exercise such options through "pyramiding" transactions, as
described under "The Acquisition - Treatment of Options." By exercising
options through pyramiding, each

- 15 -
<PAGE> 19

optionholder will receive, upon consummation of the Merger, an amount in cash
equal to the spread between the exercise price of such options and the Merger
Consideration. The following table sets forth the amount to be received by
each person who has served as an executive officer or director of the Company
since June 1, 1994, the beginning of the Company's last fiscal year, as a
result of pyramiding:

<TABLE>
<CAPTION>
Amount of Cash
Optionholder to be Received
------------ --------------
<S> <C>
Jeffrey A. Bandrowski $ 0
Jonathan D. Donaldson $ 12,850
James J. Connolly $ 32,375
David V. Harkins $ 115,125
Ernest W. Lattanzi $ 173,400
Howard A. Mileaf $ 12,850
John J. Moran $ 130,225
D. Wayne Peters $ 26,000
Robert M. Ricci $ 53,475
Carmine Vittoria $ 26,650
Arthur C. Williams $ 635,238
</TABLE>

See also "Securities Beneficially Owned By Principal Stockholders and
Management."

Messrs. Jeffrey Bandrowski, John Moran, Wayne Peters, Robert Ricci and
Arthur Williams are parties to executive severance agreements with the Company
that contain "change in control" provisions. The proposed Merger falls within
the definition of the term "change in control" under the agreements. Pursuant
to the terms of the agreements, the executive is entitled to receive payments
and benefits in the event that his employment is terminated (i) within one year
prior to a change in control unless the Company meets the burden of proving
that the termination was not in contemplation of the change in control or (ii)
within twenty-four months after the occurrence of a change in control. The
benefits to be received under the agreements depend upon the circumstances
under which employment is terminated. If employment is terminated for cause,
then the executive is entitled to receive his salary through the period ending
with the date of such termination and any accrued benefits. If employment is
terminated by the executive for Good Reason (as defined below) or by the
Company without cause, then the executive is entitled to receive (i) payment in
an amount equal to the greater of two times his annual salary in effect
immediately prior to the change in control or his annual salary in effect
immediately prior to the termination, including bonuses, which shall be
computed by averaging the last two annual bonuses, if any, (with the exception
of Mr. Peters, who is entitled to one year's salary, including any bonuses paid
within the twelve month period immediately preceding the change in control),
(ii) continued benefits until he receives benefits from a new employer or his
normal retirement date (with the exception of Mr. Peters, who is not entitled
to this benefit) and (iii) if the executive is 55 years of age or older on the
date of termination, service credit under the Company's pension plans and any
supplemental arrangements maintained for his benefit in effect immediately
prior to termination of employment until his normal retirement date (with the
exception of Mr. Peters, who is not entitled to this benefit).

"Good Reason" is defined to mean that the executive has determined in good
faith that (i) the Company has failed to assign to him on a consistent basis
executive duties performable at the location at which he worked before the
change in control which are commensurate with the level of executive duties
performed by him immediately prior to such change in control, (ii) he is
prevented by the Company from continuing to fulfill his responsibilities at a
level commensurate with that prior to the change in control, (iii) his salary
in effect immediately prior to the change in control is reduced by the Company,
(iv) the Company has failed to continue in effect any health, welfare,
retirement, vacation and other fringe benefit plans of the Company in which the
executive participated at the time of the change in control (or plans providing
substantially equivalent benefits) other than as a result of the normal
expiration of any such plan in accordance with its terms as in effect at the
time of the change in control, or the Company shall have taken or failed to
take any action which would adversely affect the executive's continued
participation in or the benefits receivable by the executive under any such
plan as in effect at the time of the change in control, or (v) the Company
shall have failed to obtain, at the executive's request, an assent to the
Company's performance of its obligations under the severance agreement from any
person that succeeds to or has the practical ability to control (either
immediately or with the passage of time), directly or indirectly, the Company's
business.

Mr. Bandrowski's employment with the Company was terminated in November 1994
and, therefore, he is not entitled to severance under his agreement. Messrs.
Peters and Williams' employment as executive officers of the Company terminated
in January 1996 and November 1995, respectively, in contemplation of the
Merger. Accordingly, they received payments of approximately $105,350 and
$341,000, respectively, and are entitled to receive benefits to the extent
provided for under their respective agreements.

REPRESENTATIONS, WARRANTIES AND COVENANTS

Kevlin, Chelton and Newco have made certain representations and warranties to
each other relating to, among other things, compliance with laws, preparation
of financial statements, legal actions and proceedings, and, in the case of
Kevlin, capitalization and share ownership, intellectual property, tax matters,
employee benefit plans, properties, and environmental matters.

Kevlin has agreed that, except with the prior written consent of Chelton,
prior to the consummation of the Merger it shall observe certain covenants,
including a covenant to conduct its operations in its ordinary and usual course
of business and consistent with past practice. Kevlin has also agreed that,
except with the prior written consent of Chelton and with certain other
exceptions set forth in the Merger Agreement, it will not take certain other
actions, including (i) issue, sell or pledge, or authorize or propose the
issuance, sale or pledge of any additional securities of Kevlin, (ii) purchase
or otherwise acquire any of its outstanding securities, (iii) declare or pay
any dividend on any shares of its capital stock, (iv) propose or adopt any
amendment to its charter or by-laws, (v) enter into, assign or terminate, or
amend in any material respect, any agreement, other than in the ordinary
course, (vi) make any material capital expenditures, other than pursuant to
previously disclosed capital expenditure programs, or (vii) waive, settle or
compromise any material litigation or material claim in an manner adverse to
Kevlin, or incur any indebtedness for borrowed money.

Kevlin, Chelton and Newco have agreed to use their respective best efforts to
obtain all authorizations and consents of third parties necessary to the
consummation of the transactions contemplated by the Merger Agreement, to
perform and fulfill all conditions and obligations under the Merger Agreement,
to maintain, with certain exceptions, the confidentiality of information
provided by the other party in connection with the Merger, and to promptly
advise the other party prior to a party's required issuance of any press
release or other information to the press or any third party with respect to
the Merger Agreement or the transactions contemplated thereby. Chelton has
agreed, subject to certain conditions, to maintain for a period of one year
following the Effective Time directors' and officers' liability insurance with
respect to causes of actions that arise out of facts or omissions occurring on
or before the Effective Time.

- 16 -
<PAGE> 20

In addition, Kevlin is permitted under the Merger Agreement to pay (i) up to
$100,000, in the aggregate, to certain employees of Kevlin (other than officers
and directors) in such proportions as Kevlin's Board shall determine, and (ii)
up to $256,033, in the aggregate, to Kevlin's non-employee directors in full
and final payment for their services to Kevlin. See "The Acquisition -
Interest of Certain Person in the Matter to be Acted Upon."

CONDITIONS OF MERGER

In addition to the approval of the Merger Agreement by the stockholders of
Kevlin, the respective obligations of Chelton and Kevlin to consummate the
Merger are subject to the following conditions, among others: (i) the
representations and warranties contained in the Merger Agreement shall be
accurate at the Effective Time; (ii) certain covenants and agreements required
of Kevlin by the Merger Agreement to be performed or complied with shall have
been performed or complied with on or prior to the Effective Time; (iii) the
parties shall have received customary legal opinions and other documents as
described in the Merger Agreement; (iv) the parties shall have obtained all
approvals, consents and waivers required to be obtained in connection with the
performance of the Merger Agreement; (v) there shall not have been instituted
or threatened any action to restrict or prohibit the merger or which would
result in material damages to Kevlin or the value of Kevlin's assets; (vi) all
outstanding options to purchase Kevlin Common Stock shall have been exercised
or terminated; and (vii) Newco shall have presented evidence to Kevlin that,
immediately prior to the Closing, it has cash on hand equal or greater to the
aggregate Merger Consideration.

TERMINATION

The Merger Agreement may be terminated prior to the Effective Time (i) by
mutual written consent of Kevlin, Chelton and Newco; (ii) by Chelton or Kevlin
if the Effective Time has not occurred on or before March 31, 1996, if the
terminating party is not in material breach under the Merger Agreement; (iii)
by Chelton or Newco if any of their conditions to closing has not been met or
waived and is no longer capable of satisfaction; (iv) by Kevlin if any of its
conditions to closing has not been met or waived and is no longer capable of
satisfaction; (v) by Chelton or Kevlin if any order, decree or ruling has been
issued or any action taken by an appropriate authority, or any litigation or
proceeding is pending which is reasonably likely to result in such issuance or
action, to prohibit the Merger;or (vi) by Kevlin, if (a) it shall have
received a Superior Proposal (as defined in the Merger Agreement); (b) a
written opinion of Palmer & Dodge that in furtherance of its fiduciary duties,
the Board of Directors of Kevlin is required to terminate the Merger Agreement
in favor of the Superior Proposal; (c) Kevlin's directors shall have resolved
to enter into an agreement with respect to the Superior Proposal within 48
hours after termination of this Agreement and (d) Kevlin shall have paid
$1,000,000 to Chelton.

If terminated for any reason described above, other than pursuant to clauses
(iii) or (iv) above, the Merger Agreement will become void and have no effect,
without any liability on the part of any party, its directors, officers or
stockholders with the exception of the provisions relating to confidentiality
and publicity, payment of the Termination Fee and payment of expenses, which
shall remain in effect. If either party terminates the Merger Agreement for
the reasons described in clause (iii) or (iv) above, the terminating party is
entitled to reimbursement by the other party of up to $150,000 for expenses
incurred in connection with the Merger. Termination of the Merger Agreement
as described above will not relieve any party from liability for any breach
thereof occurring before such termination.

WAIVER AND AMENDMENT

At any time prior to the Effective Time, (i) the parties to the Merger
Agreement may, by written agreement, modify, amend or supplement any term or
provision of the Merger Agreement or extend the time for performance of any
obligation thereunder and (ii) any term or provision of the Merger Agreement
may be waived in writing by the party which is entitled to the benefits
thereof; provided, however, that after the Merger Agreement is adopted by the
stockholders of Kevlin, no such amendment or modification may be made which
would decrease the Merger Consideration to be received in exchange for the
Kevlin Common Stock or adversely affect the rights of such stockholders,
without the further approval of the stockholders so affected.

- 17 -

<PAGE> 21

BREAKUP AND TERMINATION FEES; NO SOLICITATION

Pursuant to the terms of an Escrow Agreement dated as of October 20, 1995
among Kevlin, Chelton and M&T Securities, Inc., as Escrow Agent, Chelton
deposited $1,000,000 (the "Breakup Fee") with the Escrow Agent. This amount,
plus interest earned thereon, will be paid to Kevlin if Chelton does not
complete the Merger, unless such failure to complete the Merger is due to (i) a
failure to receive approval, to the extent necessary, from the Committee on
Foreign Investment in the United States or under the Hart Scott Rodino Fair
Trade Act, (ii) the existence of unrecorded or under recorded liabilities,
asset shortfalls or future adverse events of Kevlin having, individually or in
the aggregate, a potential value of $300,000 or more, or (iii) the failure of
Kevlin to adhere to the terms of the Letter of Intent in all material respects.
If the events described in clauses (i), (ii) or (iii) of the preceding sentence
occur, the Breakup Fee will be paid to Chelton.

Pursuant to the terms of the Merger Agreement, Kevlin is obligated to pay to
Chelton, upon demand, an amount of $1,000,000 (the "Termination Fee") if (i)
Kevlin, upon the advice of counsel, terminates the Merger Agreement and enters
into an agreement with a third party relating to a Superior Proposal (as
defined in the Merger Agreement) or (ii) Chelton or Newco terminate the Merger
Agreement as a result of any of the representations or warranties of Kevlin not
being true at the Effective Time or certain covenants of Kevlin not having been
complied with as of the Effective Time as a result of the intentional,
deliberate or fraudulent misrepresentation or breach of covenant by Kevlin, and
such representations, warranties and covenants are not capable of being true or
complied with on or before March 31, 1996.

In the Merger Agreement, Kevlin has agreed that the Board of Directors of
Kevlin will not negotiate with another party except as required in the exercise
of its fiduciary responsibilities. Kevlin is obligated to immediately inform
Chelton of any approaches made to Kevlin by third parties.

EXPENSES

The Merger Agreement provides that each party will bear its respective
expenses incurred in connection with the preparation, execution, and
performance of the Merger Agreement and the transactions contemplated thereby,
including without limitation, all fees and expenses of agents, representatives,
counsel and accountants.

REGULATORY MATTERS

Pursuant to Title IV, # 721(a) of the Defense Production Act, as amended, 50
U.S.C.A. Appendix # 2170(a), the Committee on Foreign Investment in the United
States ("CFIUS") may make an investigation to determine the effects on national
security of mergers by or with foreign persons which could result in foreign
control of persons engaged in interstate commerce in the United States. Notice
has been provided to CFIUS, and approval has been received from the Committee
to proceed with the Merger.

ACCOUNTING TREATMENT

If the Merger is consummated, Chelton expects to account for the Merger using
the purchase method of accounting.

CERTAIN FEDERAL INCOME TAX CONSEQUENCES

The following discussion summarizes the material federal income tax
consequences of the Merger to Kevlin stockholders. The discussion is based on
current provisions of the Internal Revenue Code of 1986, as amended (the
"Code"), existing and proposed Treasury Regulations, current administrative
rulings of the Internal Revenue Service ("IRS") and judicial decisions, all of
which are subject to change. The discussion does not purport to be a complete
analysis or listing of all potential tax effects relevant to a particular
Kevlin stockholder nor does it address the tax consequences that may be
relevant to particular categories of stockholders subject to special treatment
under certain

- 18 -
<PAGE> 22
federal income tax laws. In addition, it does not describe any tax consequences
arising under the laws of any state, local or foreign jurisdiction.
Accordingly, each Kevlin stockholder is urged to consult his own tax advisor
regarding the tax consequences of the Merger in his own particular tax
situation and regarding state, local and foreign tax implications of the Merger
and any tax reporting requirements of the Merger.

Tax Treatment of Kevlin, Chelton and Newco. The Merger will be treated as a
sale of the Kevlin Common Stock. Accordingly, the Company, Chelton and Newco
will recognize no gain or loss by reason of the Merger, and the basis and
holding periods of the Company's and Newco's assets immediately after the
Merger will include the basis and holding period in their hands immediately
prior to the Merger.

Tax Consequences to Kevlin's Stockholders. A stockholder who exchanges his
Kevlin Common Stock for cash in the Merger will be treated as if the shares had
been sold in a taxable transaction. Gain or loss realized will be recognized
by the stockholder with respect to the receipt of the cash in exchange for the
Company Common Stock in the Merger. The amount of gain or loss realized will
be measured by the difference between the amount of cash received and the
adjusted basis of the shares. Such gain or loss will be capital gain or loss,
assuming the shares were a capital asset in the stockholders' hands at the time
of the Merger, and will be long-term capital gain or loss if the stockholder
has held the Common Stock for more than one year at the time of the Merger.

A Kevlin stockholder who exercises dissenters' rights with respect to his
shares will be subject to tax on the receipt of the payments pursuant to
Section 302 of the Code (taking into account the application of the stock
attribution rules of Section 318 of the Code). In general, if the shares of
Kevlin Common Stock are held by the stockholder as a capital asset at the
Effective Time such stockholder will recognize capital gain or loss measured by
the difference between the amount of cash received by such stockholder and the
basis for his shares.

THE TAX DISCUSSION SET FORTH ABOVE IS INCLUDED FOR GENERAL INFORMATION ONLY
AND IS BASED UPON PRESENT LAW. EACH KEVLIN STOCKHOLDER SHOULD CONSULT HIS OWN
TAX ADVISOR AS TO THE SPECIFIC TAX CONSEQUENCES OF THE MERGER TO HIM, INCLUDING
THE APPLICATION AND EFFECT OF FEDERAL, STATE, LOCAL AND OTHER TAX LAWS AND THE
POSSIBLE EFFECTS OF CHANGES IN FEDERAL OR OTHER LAWS.

KEVLIN STOCKHOLDER APPRAISAL RIGHTS

Pursuant to Section 85 of the MBCL any holder of record of Kevlin Common
Stock who follows the procedures specified in Sections 86 to 98 of the MBCL is
entitled to have his shares appraised by superior court in Middlesex County,
Massachusetts, and to receive the appraised value of such shares in lieu of the
Merger Consideration that such holder otherwise would be entitled to receive
pursuant to the Merger Agreement. Reference is made to Sections 85 through 98
of the MBCL, copies of which are attached to this Proxy Statement as Exhibit B,
for a complete statement of the appraisal rights of dissenting stockholders.

The MBCL gives stockholders of Kevlin the right to dissent from the Merger.
The MBCL sets forth the procedure whereby a stockholder who desires to dissent
from the merger action must file with Kevlin, prior to the taking of the vote
of the stockholders on the Merger, a written objection to the Merger. Voting
in person or by proxy against the Merger will not constitute the written
objection required. A dissenting stockholder who filed the required written
objection need not vote such stockholder's shares against the Merger but, to
remain eligible to assert dissenter's appraisal rights, the shares may not be
voted in favor of the Merger. Accordingly, a vote in favor of the Merger will
constitute a waiver of such stockholder's statutory appraisal rights. In this
connection, the return of a properly signed proxy card that does not indicate a
vote or abstention on the Merger will constitute a vote in favor of the Merger.
If the Merger is approved by the required vote, Kevlin, as the Surviving
Corporation, shall be obligated, within ten (10) days after such approval, to
notify each stockholder who has filed a written objection to the action in
compliance with Section 86 of the MBCL ("Notice of Merger"). Kevlin
stockholders who have given written notice of objection to the Merger and have
not voted in favor thereof, may, within twenty (20) days after the Notice of
Merger was mailed, make written demand on the Surviving Corporation for payment
of the fair value of such

- 19 -
<PAGE> 23
stockholders' shares. Within thirty (30) days after the expiration of the 20
day period described above, the Surviving Corporation shall pay to each Kevlin
stockholder demanding payment the fair value of his stock determined as of the
day preceding the date of the Special Meeting (excluding any appreciation or
depreciation in anticipation of the Merger). If, within such thirty (30) day
period, the Surviving Corporation and any dissenting Kevlin stockholder cannot
agree upon the fair value of such shares, the Surviving Corporation or the
dissenting stockholder may, at any time within four months after the expiration
of such 30 day period, demand a determination of the value of the stock of such
dissenting stockholder by a bill in equity filed in superior court in Middlesex
County. All dissenting stockholders of Kevlin with whom the Surviving
Corporation has not reached agreement as to the value of the Kevlin Common
Stock, wherever they reside, shall be made parties to the proceeding. The fair
value of Kevlin Dissenting Shares, as determined by the court, shall be payable
only upon the surrender to the Surviving Corporation of the certificate or
certificates representing such shares, and upon payment of the fair value, the
dissenting stockholder shall cease to have any interest in such shares. Court
costs shall be borne by the party and to the extent deemed equitable by the
court. Interest shall be paid upon any award from the date of the vote
approving the Merger. The Company has made no decision whether or not it would
initiate a court proceeding if no agreement on value is reached. If it does
not, any dissenting stockholder with whom agreement has not been reached will
likely be required to incur the expense of initiating any such proceeding.

Failure to timely make appropriate demand shall result in the stockholder
being bound by the terms of the Merger. Any stockholder making such demand
shall not thereafter be entitled to notice of any meeting of stockholders or to
vote such stock for any purpose and shall not be entitled to the payment of
dividends or other distribution of the stock, except in limited circumstances
set forth in Section 96 of the MBCL.

In the event that stockholders elect to exercise these appraisal rights, the
receipt of cash for shares of Kevlin Common Stock will be a taxable transaction
to the Kevlin stockholders receiving such cash, as described above under "The
Acquisition - Certain Federal Income Tax Consequences." IT IS SUGGESTED THAT
STOCKHOLDERS CONSIDERING EXERCISING STATUTORY APPRAISAL RIGHTS CONSULT WITH
THEIR OWN TAX ADVISORS WITH REGARD TO THE TAX CONSEQUENCES OF SUCH ACTIONS.

To the extent there are any inconsistencies between the foregoing summary and
Sections 85 to 98 of the MBCL, the terms of the MBCL shall control.

KEVLIN CORPORATION SUBSEQUENT EVENTS
On November 10, 1995, Arthur Williams, the President and Chief Executive
Officer and a director of the Company, resigned as an officer and a director of
the Company. On November 16, 1995, the Board of Directors elected John Moran
as the President of the Company. Mr. Moran had previously held the position
of Vice President and Clerk of the Company, as well as serving as a director
of the Company. In addition to serving as President of the Company, Mr. Moran
will continue to serve as the Clerk and as a director of the Company. In
connection with his resignation from the Company, Mr. Williams will be paid
approximately $380,000 by the Company.

- 20 -

<PAGE> 24
<TABLE>
SECURITIES BENEFICIALLY OWNED BY
PRINCIPAL STOCKHOLDERS AND MANAGEMENT

The following table sets forth, as of December 31, 1995, the beneficial ownership of Common Stock for (i) each director of
the Company, (ii) the President (1) and the two most highly compensated executive officers of the Company, (iii) all executive
officers and directors as a group (7 persons) and (iv) each person known to the Board of Directors to beneficially own more than
five percent of the Common Stock. The address of each director and the Employee Stock Ownership Plan listed below is care of the
Company, 5 Cornell Place, Wilmington, MA 01887.
<CAPTION>
NUMBER SHARES
BENEFICIAL OWNER BENEFICIALLY OWNED (2) PERCENT
---------------- ---------------------- -------
<S> <C> <C>
Employee Stock Ownership Plan (3)(6) 334,677 12.2%

Ernest W. Lattanzi (3)(4)(5) 334,076 12.2

Arthur C. Williams (3)(5) 291,809 10.7

John J. Moran (3)(5) 151,400 5.5

Carmine Vittoria (5) 10,000 *

Howard A. Mileaf (5) 6,000 *

Jonathan D. Donaldson (5) 5,000 *

All Directors and Executive
Officers as a Group (7 persons)(3)(4)(5) 826,064 30.2%

<FN>
- - -------------------
* Less than one percent

(1) The Company does not currently have a Chief Executive Officer. Mr. Williams, the Company's former President and Chief
Executive Officer, resigned on November 10, 1995. The Board of Directors subsequently elected Mr. Moran as the President
of the Company.

(2) Beneficial ownership of Common Stock is determined in accordance with the rules of the Securities and Exchange Commission,
and includes the holding of sole or shared voting or investment power with respect to shares of Common Stock. Shares of
Common Stock subject to options currently exercisable or which become exercisable on or before February 29, 1996 are
deemed to be beneficially owned and outstanding for purposes of computing the percentage of the person holding such options,
but are not deemed outstanding for purposes of computing the percentage ownership of any other person.

(3) Includes the following number of shares allocated to the account of these executive officers and directors under the Company's
Employee Stock Ownership Plan ("ESOP") as of August 11, 1995, as to which such person has sole voting power and the ESOP
Committee has sole dispositive power: Ernest Lattanzi -- 29,886; Arthur C. Williams -- 1,809; John J. Moran -- 23,805; all
executive officers and directors as a group (7 persons) -- 58,279.

(4) Includes 200 shares held jointly by Mr. Lattanzi with his wife.

(5) Includes the following number of shares subject to options exercisable on or before February 29, 1996 by these executive
officers and directors: Jonathan D. Donaldson -- 5,000; Arthur C. Williams -- 232,500; John J. Moran -- 55,000; Ernest W.
Lattanzi -- 60,000; Howard A. Mileaf -- 5,000; Carmine Vittoria -- 10,000; all executive officers as a group (7 persons)
-- 392,500.

(6) The members of the ESOP Committee are Jacqueline C. Carlino, John A. DeLuca, Dennis D.C. Jewell, Michael Montemagno and
Timothy R. Oakes, none of whom are directors or executive officers of the Company.

</TABLE>
- 21 -
<PAGE> 25
SHARES HELD BY THE ESOP

As of January 17, 1996, 15,300 shares of Kevlin Common Stock held by the
ESOP were not allocated to individual participant accounts. It is expected
that these shares will be allocated in the beginning of February. However, in
the event that any shares remain unallocated at the time of the Special
Meeting or no voting instructions are timely received for allocated shares
held by the ESOP, in accordance with the terms of the ESOP, such shares will
be voted by John Moran, as the trustee of the ESOP, in the same proportion as
the shares held under the ESOP for which voting instructions have been
received are voted. Thus, based on the terms of the ESOP, the members of the
ESOP Committee do not have any voting power with respect to any unallocated
shares held under the ESOP.

SOLICITATION COMPENSATION

The cost of soliciting proxies from holders of shares of Kevlin Common
Stock will be borne by Kevlin. In addition to soliciting proxies by mail,
officers and employees of Kevlin, without receiving additional compensation
therefor, may solicit proxies by telephone, by telegram, or in person. Kevlin
has retained Beacon Hill Partners, Inc. to assist in the solicitation of
proxies. The fee to be paid to such firm is expected to be approximately
$4,500 plus reimbursement for reasonable out-of-pocket costs and expenses.
Kevlin will also make arrangements with brokerage firms and other custodians,
nominees, and fiduciaries to send proxy materials to their principals.

OTHER MATTERS

Kevlin knows of no other business that will be presented for action by the
stockholders at the Special Meeting. The Board of Directors of Kevlin has
approved the contents and mailing of this Proxy Statement.

ACCOMPANYING KEVLIN REPORTS
A copy of Kevlin's Annual Report on Form 10-K for the year ended May 31,
1995, and a copy of the Kevlin Quarterly Report on Form 10-Q for the quarter
ended November 30, 1995 are being delivered to Kevlin stockholders with this
Proxy Statement.
STOCKHOLDER PROPOSALS

In the event that the Merger Agreement is not approved by the Company's
stockholders at the Special Meeting or the Merger does not become effective for
any other reason, proposals which stockholders wish to be presented at the 1996
Annual Meeting of Stockholders and to be included in the Company's proxy
materials relating thereto must be received by the Company no later than April
19, 1996.

- 22 -
<PAGE> 26
EXHIBIT A

AGREEMENT AND PLAN OF MERGER

AMONG

CHELTON COMMUNICATION SYSTEMS, INC.,
KEVLIN ACQUISITION CORP.
AND
KEVLIN CORPORATION

Dated: December 6, 1995, as amended

COMPOSITE CONFORMED COPY

<PAGE> 27

TABLE OF CONTENTS

Page

ARTICLE I THE MERGER . . . . . . . . . . . . . . . . . . . . . 1
Section 1.1 The Merger. . . . . . . . . . . . . . . . . . 1
Section 1.2 Effective Time. . . . . . . . . . . . . . . . 1
Section 1.3 Effects of the Merger . . . . . . . . . . . . 1
Section 1.4 Articles of Organization and By-Laws. . . . . 1
Section 1.5 Board of Directors; Officers. . . . . . . . . 1
Section 1.6 Conversion of Shares and Options. . . . . . . 2
Section 1.7 Closing . . . . . . . . . . . . . . . . . . . 2
Section 1.8 Escrow Fund . . . . . . . . . . . . . . . . . 3

ARTICLE II DISSENTING SHARES; SURRENDER OF SHARES AND PAYMENT
THEREFOR . . . . . . . . . . . . . . . . . . . . . 3
Section 2.1 Dissenting Shares . . . . . . . . . . . . . . 3
Section 2.2 Surrender and Payment . . . . . . . . . . . . 3
Section 2.3 Shareholders Meeting; Preparation of Proxy
Statement . . . . . . . . . . . . . . . . . . 5

ARTICLE III REPRESENTATIONS AND WARRANTIES . . . . . . . . . . 6
Section 3.1 Representations and Warranties of Kevlin. . . 6
(a) Corporate Standing and Authority; Binding Agreement. 6
(b) Capitalization . . . . . . . . . . . . . . . . . . . 6
(c) Directors, Officers, Key Employees and Other
Employees . . . . . . . . . . . . . . . . . . . . . . 7
(d) Absence of Conflicting Agreements or Required
Consents . . . . . . . . . . . . . . . . . . . . . . 7
(e) Financial Statements . . . . . . . . . . . . . . . . 7
(f) Undisclosed Liabilities. . . . . . . . . . . . . . . 8
(g) Taxes. . . . . . . . . . . . . . . . . . . . . . . . 8
(h) Inventories. . . . . . . . . . . . . . . . . . . . . 10
(i) Non-Infringement of Patents, Trademarks and Other
Intellectual Property. . . . . . . . . . . . . . . . 10
(j) Operations and Use of Properties . . . . . . . . . . 11
(k) Licenses . . . . . . . . . . . . . . . . . . . . . . 11
(l) Insurance. . . . . . . . . . . . . . . . . . . . . . 11
(m) Environmental Matters. . . . . . . . . . . . . . . . 11
(n) Employees and Labor Laws . . . . . . . . . . . . . . 12
(o) Product Labeling, Product Liability and Product
Warranty . . . . . . . . . . . . . . . . . . . . . . 13
(p) Validity and Existence of Agreements . . . . . . . . 13
(q) Employee Benefit Plans . . . . . . . . . . . . . . . 14
(r) Controlled Group Status. . . . . . . . . . . . . . . 18
(s) No Multiemployer Plans . . . . . . . . . . . . . . . 18
(t) Debts and Capitalized Leases . . . . . . . . . . . . 18
(u) Litigation . . . . . . . . . . . . . . . . . . . . . 18
(v) Continuation of Business . . . . . . . . . . . . . . 18
(w) Management Personnel . . . . . . . . . . . . . . . . 19
(x) Absence of Changes . . . . . . . . . . . . . . . . . 19

i
<PAGE> 28

Page

(y) Delivery of Exhibits . . . . . . . . . . . . . . . . 19
(z) No Side Agreements . . . . . . . . . . . . . . . . . 19
(aa) Suppliers and Tooling. . . . . . . . . . . . . . . . 19
(ab) Title to and Location of Assets. . . . . . . . . . . 20
(ac) Machinery and Equipment. . . . . . . . . . . . . . . 20
(ad) Product Design and Drawings; Absence of Defects. . . 20
(ae) Government Assistance. . . . . . . . . . . . . . . . 20
(af) Arrangements with Professionals. . . . . . . . . . . 20
(ag) No Loss Contracts. . . . . . . . . . . . . . . . . . 21
(ah) Customer Relations . . . . . . . . . . . . . . . . . 21
(ai) Delivery Schedules . . . . . . . . . . . . . . . . . 21
(aj) Financial Records. . . . . . . . . . . . . . . . . . 21
(ak) Guaranties . . . . . . . . . . . . . . . . . . . . . 21
(al) Dividends. . . . . . . . . . . . . . . . . . . . . . 21
(am) No Power of Attorney . . . . . . . . . . . . . . . . 22
(an) SEC Reports. . . . . . . . . . . . . . . . . . . . . 22
(ao) Proxy Statement. . . . . . . . . . . . . . . . . . . 22
(ap) Management Shares. . . . . . . . . . . . . . . . . . 22
(aq) Status of Flow Vision. . . . . . . . . . . . . . . . 22
(ar) Truth of Representations . . . . . . . . . . . . . . 22
Section 3.2 Representations and Warranties of Chelton
and NEWCO . . . . . . . . . . . . . . . . . . 23
(a) Corporate Standing and Authority . . . . . . . . . . 23
(b) Litigation . . . . . . . . . . . . . . . . . . . . . 23
(c) Proxy Statement. . . . . . . . . . . . . . . . . . . 23
(d) Truth of Representations . . . . . . . . . . . . . . 24

ARTICLE IV COVENANTS. . . . . . . . . . . . . . . . . . . . . 24
Section 4.1 Conduct of Business of Kevlin . . . . . . . . 24
Section 4.2 Access to Information . . . . . . . . . . . . 25
Section 4.3 Best Efforts. . . . . . . . . . . . . . . . . 26
Section 4.4 Consents. . . . . . . . . . . . . . . . . . . 26
Section 4.5 Public Announcements. . . . . . . . . . . . . 27
Section 4.6 Certain Payments. . . . . . . . . . . . . . . 27
Section 4.7 Funding of NEWCO. . . . . . . . . . . . . . . 27
Section 4.8 Insurance . . . . . . . . . . . . . . . . . . 27

ARTICLE V CONDITIONS TO CONSUMMATION OF THE MERGER . . . . . . 27
Section 5.1 Conditions to Kevlin's Obligation to Close. . 27
(a) Representations and Warranties . . . . . . . . . . . 27
(b) No Litigation. . . . . . . . . . . . . . . . . . . . 28
(c) Merger Consideration . . . . . . . . . . . . . . . . 28
(d) Approval of Kevlin's Stockholders. . . . . . . . . . 28
(e) Receipt of Consents. . . . . . . . . . . . . . . . . 28
(f) Opinion of Chelton and NEWCO's Counsel . . . . . . . 28
Section 5.2 Conditions to Chelton's and NEWCO's Obligation
to Close. . . . . . . . . . . . . . . . . . . 28
(a) Representations, Warranties and Covenants. . . . . . 28
(b) No Litigation. . . . . . . . . . . . . . . . . . . . 28
(c) Approval of Kevlin's Stockholders. . . . . . . . . . 29

ii
<PAGE> 29

Page

(d) Receipt of Consents. . . . . . . . . . . . . . . . . 29
(e) Opinion of Kevlin's Counsel. . . . . . . . . . . . . 29
(f) Resignation Letters. . . . . . . . . . . . . . . . . 29
(g) Continuation of Insurance. . . . . . . . . . . . . . 29
(h) Environmental Study. . . . . . . . . . . . . . . . . 29
(i) Stock Options. . . . . . . . . . . . . . . . . . . . 29
Section 5.3 Other Conditions. . . . . . . . . . . . . . . 29
Section 5.4 No Solicitation . . . . . . . . . . . . . . . 29

ARTICLE VI TERMINATION; AMENDMENTS; WAIVER. . . . . . . . . . 31
Section 6.1 Termination . . . . . . . . . . . . . . . . . 31
Section 6.2 Effect of Termination . . . . . . . . . . . . 32
Section 6.3 Amendment . . . . . . . . . . . . . . . . . . 33
Section 6.4 Extension; Waiver . . . . . . . . . . . . . . 33

ARTICLE VII MISCELLANEOUS. . . . . . . . . . . . . . . . . . . 33
Section 7.1 Survival of Representations and Warranties. . 33
Section 7.2 Brokerage Fees; Commissions and Expenses. . . 33
Section 7.3 Entire Agreement; Assignment. . . . . . . . . 33
Section 7.4 Validity. . . . . . . . . . . . . . . . . . . 34
Section 7.5 Notices . . . . . . . . . . . . . . . . . . . 34
Section 7.6 Governing Law . . . . . . . . . . . . . . . . 35
Section 7.7 Descriptive Headings. . . . . . . . . . . . . 35
Section 7.8 Counterparts. . . . . . . . . . . . . . . . . 35
Section 7.9 Expenses. . . . . . . . . . . . . . . . . . . 35
Section 7.10 Specific Performance. . . . . . . . . . . . . 35
Section 7.11 Certain Definitions . . . . . . . . . . . . . 35
Section 7.12 Performance by NEWCO. . . . . . . . . . . . . 36
Section 7.13 Parties in Interest . . . . . . . . . . . . . 36

iii
<PAGE> 30
AGREEMENT AND PLAN OF MERGER
----------------------------

THIS AGREEMENT AND PLAN OF MERGER (the "Agreement"), dated
as of December 6, 1995, is among KEVLIN CORPORATION, a Massachusetts
corporation ("Kevlin"), Kevlin Acquisition Corp., a Massachusetts
corporation and a wholly-owned subsidiary of Chelton Communication
Systems, Inc., ("NEWCO"), and CHELTON COMMUNICATION SYSTEMS, INC., a
Delaware corporation ("Chelton").

The respective Boards of Directors of Chelton, NEWCO and
Kevlin have duly approved the acquisition of Kevlin by Chelton by
means of a merger of NEWCO with and into Kevlin pursuant to the terms
of this Agreement. It is therefore agreed as follows:

ARTICLE I
THE MERGER

Section 1.1 THE MERGER. Upon the terms and subject to
the conditions hereof, and in accordance with the relevant provisions
of the Massachusetts Business Corporation Law (the "Massachusetts
Act") including, without limitation, any required vote of
shareholders of Kevlin as described in SECTION 2.3 of this Agreement,
NEWCO shall be merged with and into Kevlin (the "Merger") as soon as
practicable following the satisfaction or waiver, if permissible, of
the conditions set forth in Article V hereof. Following the Merger,
Kevlin shall continue as the surviving corporation (the "Surviving
Corporation") under the laws of the Commonwealth of Massachusetts and
the separate corporate existence of NEWCO shall cease.

Section 1.2 EFFECTIVE TIME. The Merger shall be
consummated by filing the Articles of Merger with the Massachusetts
Secretary of State in a form mutually agreeable to the parties hereto
(the "Articles of Merger") (the time that such filing is accomplished
is referred to herein as the "Effective Time").

Section 1.3 EFFECTS OF THE MERGER. The Merger shall
have the effects set forth in Section 80 of the Massachusetts Act.

Section 1.4 ARTICLES OF ORGANIZATION AND BY-LAWS.
The Articles of Organization and By-Laws of Kevlin, both as in effect at
the Effective Time, shall be the Articles of Organization and By-Laws
of the Surviving Corporation.

Section 1.5 BOARD OF DIRECTORS; OFFICERS. As of the
Effective Time, the directors of NEWCO in office immediately prior to
the Effective Time shall be the directors of the Surviving
Corporation until their respective successors are duly elected and
qualified. The officers of NEWCO immediately prior to the Effective
Time shall be the officers of the Surviving

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Corporation until their successors are duly elected and qualified.

Section 1.6 CONVERSION OF SHARES AND OPTIONS.

(a) Each share of common stock, $.10 par value per
share ("Shares" or "Kevlin Common Stock"), of Kevlin issued and
outstanding immediately prior to the Effective Time (other than
Shares held by Kevlin as treasury stock, which shall be cancelled)
shall, by virtue of the Merger and without any action on the part of
any holder thereof, be converted into the right to receive a cash
payment in the amount of four dollars and fifty-four cents ($4.54)
(the "Merger Consideration"). The Merger Consideration shall be
payable upon surrender of the certificates formerly representing
Shares in accordance with SECTION 2.2.

(b) Each Share held in the treasury of Kevlin
immediately prior to the Effective Time shall, at the Effective Time,
by virtue of the Merger and without any action on the part of Kevlin,
be cancelled and retired and cease to exist and no payment shall be
made with respect thereto.

(c) Each share of common stock of NEWCO issued and
outstanding immediately prior to the Effective Time shall, by virtue
of the Merger and without any action on the part of Chelton, be
converted into and become one fully paid and nonassessable share of
common stock of the Surviving Corporation.

(d) Kevlin shall make arrangements with each holder
of an option to purchase shares of Kevlin Common Stock outstanding
immediately prior to the Effective Time ("Stock Options") to exercise
such options and purchase shares of Common Stock. Such option
exercises may be accomplished by payment of the exercise price in
Common Stock, including stock acquired upon exercise of such option,
valued at the Merger Consideration, with such exercise being
contingent upon the conditions to the consummation of the Merger set
forth in Article V hereof being satisfied or waived. To the extent
that a shareholder vote is not required, all stock option plans of
Kevlin shall terminate as of the Effective Time, and Kevlin shall
ensure that no holder of an option to purchase Kevlin Common Stock
shall have any rights under outstanding options or under the relevant
stock option plans except to receive the cash payment as a
stockholder entitled to payment under subsection (a) above.

Section 1.7 CLOSING. Upon the terms and subject to
the conditions hereof, as soon as practicable after the satisfaction
of all conditions described in Article V, Kevlin and NEWCO shall hold
a closing (the "Closing") at the offices of Palmer & Dodge in Boston,
Massachusetts (or such other place as the parties may agree), for the
purpose of implementing all transactions described in this Agreement.
At the Closing, the parties shall arrange for the filing of the
Articles of Merger with the Massachusetts Secretary of State and
shall take such

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other and further actions as may be required by law
to make the Merger effective. The parties presently contemplate that
the Closing will be held immediately following the Special Meeting
described in SECTION 2.3.

Section 1.8 ESCROW FUND. The parties acknowledge that
Chelton has deposited $1,000,000 (the "Escrow Fund") in cash with M&T
Securities, Inc. (the "Escrow Agent") pursuant to an Escrow Agreement
among Kevlin, Chelton and the Escrow Agent. The Escrow Fund will be
disbursed by the Escrow Agent as provided for in the Escrow
Agreement.

ARTICLE II
DISSENTING SHARES; SURRENDER OF SHARES
AND PAYMENT THEREFOR

Section 2.1 DISSENTING SHARES. Section 85 of the
Massachusetts Act provides dissenter's rights in connection with the
Merger to the shareholders of Kevlin.

Section 2.2 SURRENDER AND PAYMENT.

(a) Prior to the Closing, Kevlin shall appoint an
agent (the "Paying Agent") for the purpose of paying the Merger
Consideration in exchange for certificates representing shares or
options to purchase shares of Kevlin Common Stock ("Certificates").
As soon as practicable after the Effective Time, the Paying Agent
shall send a notice and transmittal form (which shall specify that
delivery shall be effected, and risk of loss and title to
Certificate(s) shall pass, only upon delivery of such Certificate(s)
to the Paying Agent and shall be in a form and have such other
provisions as Kevlin may reasonably specify) to each Holder of a
Certificate(s) theretofore evidencing shares of Kevlin Common Stock,
outstanding immediately prior to the Effective Time, advising each
such holder of the effectiveness of the Merger and the procedure for
surrendering to the Paying Agent such Certificates for payment of the
Merger Consideration.

(b) The Surviving Corporation shall transmit by
wire or other acceptable means to the Paying Agent prior to the
Effective Time the funds necessary for all exchanges in accordance
with this Agreement. The Paying Agent shall agree to deliver such
funds (in the form of checks of the Paying Agent) in accordance with
this SECTION 2.2 and such additional terms as may be agreed upon by
the Paying Agent and Kevlin. Any portion of such funds which has not
been paid pursuant to this SECTION 2.2 by six months after the
Effective Time shall promptly be paid to the Surviving Corporation,
and thereafter any stockholders of Kevlin who have not theretofore
complied with this SECTION 2.2 shall look only to the Surviving
Corporation for payment of the amount to which they are entitled in
the Merger.

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into the right to receive the Merger Consideration, upon
surrender to the Paying Agent of such Certificate(s) for
cancellation, together with a duly completed transmittal form and
such other documents as may be reasonably requested by the Paying
Agent, will be entitled promptly to receive a check representing cash
in the amount of the Merger Consideration times the number of shares
of Kevlin Common Stock represented by such Certificate(s) less any
amount required to be withheld under applicable Federal income tax
regulations ("Back Withholding").

(d) If payment of the Merger Consideration (or any
portion thereof) is to be made to a person other than the person in
whose name the Certificate(s) surrendered in exchange therefor is
registered, it shall be a condition of such payment that the
Certificate(s) so surrendered shall be properly endorsed or shall be
otherwise in proper form for transfer and that the person requesting
such payment shall pay to the Paying Agent any transfer or other
taxes required by reason of such payment, or shall establish to the
satisfaction of the Paying Agent that such tax has been paid or is
not applicable. Notwithstanding the foregoing, neither the Paying
Agent nor any party hereto shall be liable to any person claiming the
right to receive the Merger Consideration for any cash delivered to a
public official pursuant to any applicable abandoned property,
escheat or similar law. If any Certificate(s) shall not have been
surrendered prior to five years after the Effective Time (or
immediately prior to such earlier date on which any payment pursuant
to this Article II would otherwise escheat to or become the property
of any Federal, state or local government agency or court,
administrative agency or commission or other governmental authority
or agency, domestic or foreign, the payment in respect of such
Certificate(s) shall, to the extent permitted by applicable law,
become the property of the Surviving Corporation, free and clear of
all claims or interest of any person previously entitled thereto.

(e) In the event any Certificate(s) theretofore
representing shares of Kevlin Common Stock to be exchanged for the
Merger Consideration has been lost, stolen or destroyed, the Paying
Agent shall pay to the person claiming that such Certificate(s) has
been lost, stolen or destroyed the cash into which the shares
theretofore represented by such Certificate(s) have been converted as
provided under the terms of this Agreement (less any required Backup
Withholding), upon receipt of evidence of ownership of such
Certificate(s) and appropriate indemnification in each case satisfactory
to the Paying Agent.

(f) Until surrendered as contemplated by this
SECTION 2.2, each Certificate shall be deemed at any time after the
Effective Time to represent only the right to receive upon such
surrender the amount of cash, without interest, into which the shares
of Kevlin Common Stock theretofore represented by such Certificate
shall have been converted pursuant to SECTION 1.6. No interest shall
accrue or be paid on any portion of the Merger Consideration.

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Section 2.3 SHAREHOLDERS MEETING; PREPARATION OF
PROXY STATEMENT.

(a) Kevlin will duly call, give notice of, convene
and hold a special meeting of the holders of Kevlin Common Stock (the
"Special Meeting") for the purpose of approving this Agreement as
soon as practicable after the date hereof. Subject to the
requirements of applicable fiduciary duties, Kevlin will, through its
Board of Directors, recommend to its stockholders approval of this
Agreement.

(b) Kevlin will prepare and file a preliminary
Proxy Statement with the SEC and will use its best efforts to respond
to any comments of the SEC or its staff and to cause the Proxy
Statement to be mailed to Kevlin's stockholders as promptly as
practicable after responding to all such comments to the satisfaction
of the staff. Kevlin will notify Chelton promptly of the receipt of
any comments from the SEC or its staff and of any requests by the SEC
or its staff for amendments or supplements to the Proxy Statement or
for additional information and will supply Chelton with copies of all
correspondence between Kevlin or any of its representatives, on the
one hand, and the SEC or its staff, on the other hand, with respect
to the Proxy Statement or the Merger. If at any time prior to the
Special Meeting there shall occur any event that should be set forth
in an amendment or supplement to the Proxy Statement, Kevlin will
promptly prepare and mail to its stockholders such an amendment or
supplement. Kevlin will not mail any Proxy Statement, or any
amendment or supplement thereto, to which Chelton reasonably objects.

(c) Kevlin and Chelton agree that Kevlin shall engage
Beacon Hill Partners as the proxy solicitor for the Special Meeting.

ARTICLE III
REPRESENTATIONS AND WARRANTIES

Section 3.1 REPRESENTATIONS AND WARANTIES OF
KEVLIN. Kevlin represents and warrants to Chelton and NEWCO that:

(a) CORPORATE STANDING AND AUTHORITY; BINDING
AGREEMENT. Kevlin is a corporation duly organized, validly existing
and in good standing under the laws of the Commonwealth of
Massachusetts. Kevlin has full power to own all of its properties
and assets that are owned by it and to conduct its business as it is
now being conducted, and neither its ownership or leasing of property
nor the conduct of its business requires it to be qualified as a
foreign entity in any jurisdiction in which it is not qualified where
the failure to qualify would have a Material Adverse Effect (as
defined in SECTION 7.11(a) hereof) on Kevlin's business. The
execution of this Agreement and consummation of the transactions
contemplated herein will not

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violate any provision of Kevlin's Articles of Organization or
By-laws, and Kevlin has obtained all necessary authorization and
approval from its Board of Directors for the execution of this
Agreement and the consummation of the transactions contemplated
hereby. This Agreement is a legal, valid and binding agreement of
Kevlin, enforceable against it in accordance with its terms, subject
to the laws of bankruptcy, insolvency and moratorium and other laws or
equitable principles generally affecting creditors' rights and to
general equitable principles. Complete and correct copies of the
Articles of Organization and By-Laws of Kevlin have been made
available to Chelton.

(b) CAPITALIZATION. The entire authorized capital
stock of Kevlin consists of 8,000,000 shares of Kevlin Common Stock
and 2,000,000 Shares of Preferred Stock. As of the date of this
Agreement, 2,733,794 shares of Kevlin Common Stock are issued and
outstanding and 393,087 shares of Kevlin Common Stock are held by
Kevlin in its treasury. As of the date of this Agreement there are
no shares of Kevlin Preferred Stock outstanding. Of the authorized
shares of Kevlin Common Stock, 695,500 are reserved for issuance upon
the exercise of certain Stock Options (as defined in SECTION 1.6(d)).
All of the issued and outstanding shares of Kevlin Common Stock and
the shares of Kevlin Common Stock which may be sold pursuant to the
exercise of the Stock Options have been duly authorized and are (or,
in the case of shares which may be sold pursuant to the exercise of
Stock Options, will be when so sold) validly issued, fully paid, and
nonassessable. Except for the Stock Options there are no outstanding
or authorized options, warrants, rights, contracts, calls, puts,
rights to subscribe, conversion rights or other agreements or
commitments to which Kevlin is a party or by which it is bound
providing for the issuance, disposition, redemption, repurchase or
acquisition of any of its capital stock. EXHIBIT 3.1(b) sets forth
with respect to each Stock Option, (i) the name of the owner of such
option, (ii) the date of the grant, (iii) the expiration date and
(iv) the exercise price. Kevlin has no equity interest in and has
not made advances to any corporation, association, partnership, joint
venture or other entity other than the subsidiaries described in
EXHIBIT 3.1(b).

EXHIBIT 3.1(b) sets forth the name, the number
of shares of authorized capital stock and the number of issued and
outstanding shares of capital stock or other indicia of ownership of
each direct or indirect Subsidiary of Kevlin, as well as the current
status of such Subsidiary. Except as set forth in such Exhibit, all
of the outstanding shares of capital stock of each of the
Subsidiaries are owned, directly or indirectly, by Kevlin,
beneficially and of record. All such shares of capital stock of the
Subsidiaries are owned free and clear of all liens, charges,
encumbrances, rights of others, mortgages, pledges or security
interests, and are not subject to any agreements or understandings
among any persons with respect to the voting or transfer of such
shares. There are no outstanding subscriptions, options, convertible
securities, warrants or claims of any kind issued or granted by or
binding on

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Kevlin to purchase or otherwise acquire any security of or
equity interest in any of such Subsidiaries. All of the outstanding
shares of capital stock of each such Subsidiary have been duly
authorized and validly issued and are fully paid and non-assessable,
and none has been issued in violation of the preemptive rights of any
stockholder.

(c) DIRECTORS, OFFICERS, KEY EMPLOYEES AND OTHER
EMPLOYEES. Attached hereto as EXHIBIT 3.1(c) is a list of all
employees of Kevlin showing their names, positions and current annual
salaries or rate of compensation (including commitments or
understandings with respect to bonus, overtime entitlement and
incentive compensation). The directors, officers and the employees
reporting directly to them of Kevlin are separately identified in
EXHIBIT 3.1(c).

(d) ABSENCE OF CONFLICTING AGREEMENTS OR REQUIRED
CONSENTS. The execution, delivery and performance of this Agreement
by Kevlin does not and will not: (i) conflict with or violate any
law, rule, regulation, order, judgment or decree applicable to Kevlin
or by which it is bound or affected, (ii) result in any breach of or
constitute a default under any note, bond, mortgage, indenture,
lease, license, franchise or other instrument or obligation to which
Kevlin is a party, or (iii) except as set forth in EXHIBIT 3.1(d),
require Kevlin to obtain any novation, consent, approval,
authorization or permit of, or filing with or notification to, any
governmental or regulatory authority, domestic or foreign, or any
person or entity not a party to this Agreement.

(e) FINANCIAL STATEMENTS. Kevlin has furnished or
will furnish Chelton with: (i) independently audited financial
statements as at May 31, 1993, 1994 and 1995 and for the fiscal years
then ended; (ii) financial statements as at August 31, 1995 and for
the period then ended and (iii) an interim balance sheet as of the
end of the month immediately preceding the Closing and statement of
profit and loss and supporting schedules of expenses for the period
then ended and notes, as appropriate (collectively, the "Financial
Statements"). Except as set forth in the notes to the Financial
Statements, the Financial Statements have been or will be, as the
case may be, prepared in accordance with generally accepted
accounting principles consistently applied ("GAAP"), and fairly
present or will fairly present, as the case may be, the results of
the operations of Kevlin and Kevlin's financial position for the
periods indicated other than, with respect to the interim financial
statements, for non-material changes resulting from normal year-end
adjustments. There shall be no changes made in the accounting
principles used in preparing any Financial Statements for periods
subsequent to May 31, 1995, nor shall there be any changes in the
method of application of same.

(f) UNDISCLOSED LIABILIITIES. Kevlin is not liable
for or subject to any Liabilities (as hereinafter defined), except
(a) Liabilities adequately disclosed or reserved

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for in the most recent Financial Statements and not heretofore paid or
discharged, (b) Liabilities under any contract, commitment or agreement
specifically disclosed in EXHIBIT 3.1(p) or not required to be
disclosed thereon, none of which Liabilities under any such contract,
commitment or agreement were required under GAAP to have been
adequately and specifically disclosed or reserved for in the most
recent Financial Statements, or (c) Liabilities incurred, consistent
with past practice, in or as a result of the ordinary course of
business of Kevlin, and in accordance with this Agreement, since the
date of the most recent Financial Statements which individually do
not exceed $25,000 and in the aggregate do not exceed $175,000. As
used in this Agreement, the term "Liabilities" shall include any
direct or indirect liability, indebtedness, obligation, guarantee or
endorsement (other than endorsements of notes, bills and checks
presented to banks for collection or deposit in the ordinary course
of business), whether known or unknown, accrued, absolute, contingent
or otherwise.

(g) TAXES. (i) Kevlin has delivered to Chelton
copies of the federal income tax returns of Kevlin for each of the
last three fiscal years and all schedules and exhibits thereto.
Kevlin has duly and timely filed in correct form all material
federal, state and local information returns and tax returns
("Returns") required to be filed by it on or prior to the date hereof
(all such Returns being accurate and complete in all material
respects), and has duly paid or made provision for the payment of all
material taxes and other governmental charges which have been
incurred or are due or claimed to be due from them by any
governmental authority (including, without limitation, those due in
respect of Kevlin's properties, income, business, capital stock,
franchises, licenses, sales and payrolls) other than taxes or other
charges (i) which are not yet delinquent or are being contested in
good faith and (ii) have not been finally determined. The
liabilities and reserves for taxes in the Financial Statements are
sufficient in the aggregate for the payment of all material unpaid
federal, state and local taxes (including any interest or penalties
thereon), whether or not disputed or accrued, for the period ended
May 31, 1995 or for any year or period prior thereto, and for which
Kevlin may be liable in its own right or as transferee of the assets
of, or successor to, any corporation, person, association,
partnership, joint venture or other entity. For purposes hereof,
"Tax" or "Taxes" shall mean all taxes, levies, assessments, charges
or fees of any kind or character, including without limitation U.S.
federal, state, local and foreign income, profits, capital gains,
franchise, sales, use, service, gross receipts, occupation, property,
property transfer, lease, capital stock, premium, excise, payroll,
withholding, estimated taxes and other governmental charges imposed
by the United States or any state, county, local or foreign
government or subdivision or agency thereof, including any interest,
additions to tax and penalties thereon.

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(ii) Except as disclosed in EXHIBIT 3.1(g),
(a) proper and accurate amounts have been withheld by the Company
from its employees and others for all prior periods in compliance in
all material respects with the tax withholding provisions of
applicable federal, state and local laws and regulations, and proper
due diligence steps have been taken in connection with back-up
withholding, (b) Returns which are accurate and complete in all
material respects have been filed by Kevlin for all periods for which
Returns were due with respect to income tax withholding, Social
Security and unemployment taxes and (c) the amounts shown on such
Returns to be due and payable have been paid in full, or adequate
provision therefor has been included by the Kevlin in the most recent
Financial Statements.

(iii) TAX AUDITS. Except as disclosed in
EXHIBIT 3.1(g), (a) no audit of any material Return of Kevlin is
currently in progress, nor has Kevlin been notified that such an
audit is contemplated by any taxing authority, (b) Kevlin has not
extended any statute of limitations with respect to the period for
assessment of any federal, state or local Tax, (c) Kevlin does not
contemplate the filing of an amendment to any Return, which amendment
would have a Material Adverse Effect on Kevlin and (d) Kevlin does
not have any actual or potential material liability for any Tax
obligation of any taxpayer (including, without limitation, any
affiliated group of corporations or other entities which included
Kevlin during a prior period) other than Kevlin. Except as disclosed
in the Financial Statements or EXHIBIT 3.1(g), there are no material
Tax claims pending against Kevlin, to the best of Kevlin's knowledge,
there are no material Tax claims threatened to be asserted against
Kevlin, and there are no material issues which have been raised in
prior periods or audits which by application of similar principles
are expected to result in a material Tax claim for any other period.

(h) INVENTORIES. Kevlin's inventory: (i) complies
in all material respects with all applicable federal laws and
regulations and with all applicable laws and regulations of each of
the states of the United States into which any product would be
shipped directly by Kevlin; (ii) does not contain any Hazardous
Materials (as hereinafter defined) and (iii) does not consist of any
damaged or obsolete items which are material in amount. The
inventories reflected in the Financial Statements have been or will
be acquired in the ordinary course of business of Kevlin in
accordance with its normal inventory practices and are or will be
stated in accordance with GAAP and on a basis that is consistent with
the valuation of same in Kevlin's May 31, 1995 balance sheet.

(i) NON-INFRINGMENT OF PATENTS, TRADEMARKS AND
OTHER INTELLECTUAL PROPERTY. EXHIBIT 3.1(i) contains a complete list
of all of the patents, copyrights, trademarks, trade names, and
service marks and names of Kevlin (the "Intellectual Property"). To
the knowledge of Kevlin, the Intellectual Property does not infringe
on or violate the rights of any person or entity. Kevlin is not
aware of any claim of infringement or

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violation of the rights of others with respect to the Intellectual Property;
nor is Kevlin aware of any use or exploitation by another person or entity
which would conflict with Kevlin's claim to ownership of and right to use any
of the Intellectual Property or which is similar to such Intellectual
Property so as to create a reasonable possibility of confusion as to
the source or ownership of any Intellectual Property by any member of
the public, other than those licenses or alleged infringements
disclosed on EXHIBIT 3.1(i). Except as disclosed in EXHIBIT 3.1(i),
Kevlin has not licensed or permitted any other person or entity to
use or exploit any Intellectual Property currently or at any time in
the future, nor has Kevlin known of the existence of any such
exploitation. Except as disclosed in EXHIBIT 3.1(i), Kevlin has not,
within the prior ten years, been involved in any controversy with
another person or entity involving the use or exploitation of any
Intellectual Property. EXHIBIT 3.1(i) contains a listing of all
registrations in any governmental office or registry with respect to
any Intellectual Property. Kevlin's right to use or exploit any
Intellectual Property is not dependent upon any license, permit,
grant or agreement except as set forth in any registration listed in
EXHIBIT 3.1(i). Kevlin is not obligated to make any royalty or other
payments with respect to any Intellectual Property. Kevlin owns all
Intellectual Property necessary for the conduct of its business as it
is conducted on the date hereof.

(j) OPERATIONS AND USE OF PROPERTIES. To Kevlin's
knowledge, Kevlin's operations, business and properties, including
leased properties, are in conformity in all material respects with
all applicable laws or orders or other governmental or administrative
laws, ordinances, regulations or orders, including without limitation
zoning, land use and building codes and motor vehicle registration,
permitting, inspection and operation. Kevlin's assets are sufficient
for the conduct of Kevlin's business as it currently is conducted and
as it is proposed to be conducted in accordance with Kevlin's current
commitments. Kevlin does not own or lease, directly or indirectly,
any real property other than the real property listed on
EXHIBIT 3.1(j). There are no foreseeable costs payable by Kevlin
upon the scheduled expiration of any real property lease.

(k) LICENSES. Kevlin has all licenses, permits,
approvals and other governmental authorizations necessary to own all
of its properties and assets and to carry on its business as it is
now being conducted except such as do not materially interfere with
the conduct of its business, all of which are listed in
EXHIBIT 3.1(k) (collectively, the "Licenses"). Each License is valid
and in full force and effect. Upon obtaining any required consents,
the continuation, validity and effectiveness of each License will in
no way be affected by the consummation of the transactions
contemplated by this Agreement. Kevlin has not breached any
provision of, is not in default under the terms of, and has not
engaged in any activity that would cause revocation or suspension of,
any License and no action or proceeding looking to or contemplating
the revocation or

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suspension of any License is pending or, to the knowledge of Kevlin,
threatened.

(l) INSURANCE. Kevlin is covered by valid and
currently effective insurance policies as set forth in EXHIBIT 3.1(l).
Any insurance for which the current policy period by its terms extends
beyond the Closing shall be kept in place by Kevlin and not terminated
for any reason.

(m) ENVIRONMENTAL MATTERS. Kevlin has been and
currently is in full compliance with all Environmental Laws as
hereinafter defined (i) at all the property leased by Kevlin during the
past eight years ("Kevlin's Facilities") and (ii) in connection with all
of Kevlin's operations conducted at Kevlin's Facilities. Except as set
forth in EXHIBIT 3.1(m), there is not now, and has not been since Kevlin
commenced operations, any presence, disposal, release or threatened
release of any Hazardous Materials at Kevlin's Facilities, and to
Kevlin's knowledge, no such event or condition occurred at Kevlin's
Facilities prior to Kevlin's occupancy of same. To the knowledge of
Kevlin, no asbestos, urea-formaldehyde foam or other forms of urea
formaldehyde have been installed on or are included in the furnishing or
construction of any building or other improvement at Kevlin's
Facilities. To the knowledge of Kevlin, Kevlin has made no disposal of
any Hazardous Materials at any site currently listed pursuant to 42
U.S.C SECTION 9605(a)(8)(B) (or pursuant to any similar state or local
law identifying hazardous sites) or any site currently being
investigated for such listing pursuant to any such federal, state or local
law. To the knowledge of Kevlin, there are no pending or threatened
claims with respect to Hazardous Materials relating to Kevlin's Facilities
or relating to any operations of Kevlin at Kevlin's Facilities, and Kevlin
does not know of any basis for a claim being made against Kevlin with
respect to any Hazardous Materials or under any Environmental Laws.
Kevlin has never used nor owned any underground storage tanks.

For purposes of this Agreement, the term "Hazardous
Material" shall mean any hazardous or toxic chemical, waste, byproduct,
pollutant, contaminant, compound, product or substance, including, without
limitation, asbestos, polychlorinated biphenyls, petroleum (including
crude oil or any fraction thereof), radioactive substances and any
material the manufacture, possession, presence, use, generation, storage,
transportation, treatment, release, disposal, abatement, cleanup, removal,
remediation or handling of which is prohibited, controlled or regulated by
any law, including without limitation the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, as amended, 42 U.S.C.
SECTION 9601, et seq.; the Hazardous Materials Transportation Act, 49
U.S.C. SECTION 1801, et seq.; the Resource Conservation and Recovery Act,
42 U.S.C. SECTION 6901, et seq.; the Federal Water Pollution Control Act,
33 U.S.C. SECTION 1251, et seq.; the Safe Drinking Water Act, 42 U.S.C.
SECTION 300f, et seq.; Toxic Substances Control Act, 15 U.S.C. SECTION
2601, et seq.; Occupational Safety and Health Act, 29 U.S.C. SECTION 651,
et

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seq.; Clean Air Act, 42 U.S.C. Section 7401, et seq.; and comparable
provisions of applicable local county and city ordinances, or any
substances so defined or stated in any of the regulations adopted and
publications promulgated pursuant to those laws as they may have been
amended from time to time on or before the date hereof (collectively,
"Environmental Laws").

(n) EMPLOYEES AND LABOR LAWS. Kevlin has not
experienced any strikes, lockouts, grievances or other material labor
disputes or demands for recognition of a union as collective
bargaining agent for all or any part of Kevlin's employees, and
Kevlin is not and has never been a party to any collective bargaining
or other labor agreement. Except as disclosed in EXHIBIT 3.1(n),
Kevlin has no written agreements of employment and no oral agreements
or understandings with any employee as to any specific period of
employment. Kevlin is in compliance in all material respects with
all federal, state and local governmental laws and regulations
relating to the employment of labor, including provisions relating to
wages, fringe benefits, hours, working conditions, occupational
safety and health, safety of the premises, collective bargaining,
payment of social security and unemployment taxes, civil rights and
discrimination in hiring, retention, promotion, pay and other
conditions of employment; and Kevlin is not liable for arrearages on
wages or any tax or penalties for failure to comply with those laws
or regulations. There are no oral agreements or understandings with
employees except as to current salary or wage rates and no other oral
agreements or understandings which will affect Kevlin's employment
practices or operations. Kevlin is in compliance with the
Immigration Reform and Control Act of 1986. Employees are generally
required to work 40 hours a week.

(o) PRODUCT LABELING, PRODUCT LIABILITY AND PRODUCT
WARRANTY. Kevlin is in compliance in all material respects with all
federal and state laws and regulations relating to product labeling,
product safety and public health and safety. Kevlin has not received
any notice of any claim that any product now or heretofore offered
for sale or sold by it or distributed by it in connection with
product sales is injurious to the health and safety of any person or
is not in conformity with its specifications or not suitable for any
purpose or application for which it is offered for sale, sold or
distributed. Attached as EXHIBIT 3.1(o) are complete and correct
copies of all product warranties with Kevlin's customers and
instances where Kevlin has obligated itself to provide repair and
product support services at no cost (or discounted cost) to its
customers and such obligation is currently outstanding and will be
outstanding as of the Effective Time. There are no outstanding
returns of product from customers of Kevlin which have not been
recorded in Kevlin's books or issues relating to products delivered
by Kevlin that could give rise to product returns. Where
contractually required, products sold by Kevlin have been released in
conformance with Kevlin's own certification of conformity.

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(p) VALIDITY AND EXISTENCE OF AGREEMENTS.
EXHIBIT 3.1(p) sets forth all the following with respect to Kevlin
(collectively referred to as the "Agreements"):

(1) All written agreements, contracts,
arrangements, commitments, understandings or obligations to which
Kevlin is a party or by which it or its properties is or may be bound
which involve more than $25,000 in the aggregate;

(2) All written agreements, contracts,
arrangements, commitments, understandings or obligations, limiting in
any respect the freedom of Kevlin or any of its key employees to
compete in any line of business or with any person or to do business
with any particular customers or class of customers or to carry on
business in any geographic area;

(3) All written agreements, contracts,
arrangements, commitments, understandings or obligations with respect
to the payment by Kevlin of commissions which involve more than
$25,000 in the aggregate;

(4) Kevlin's published standard conditions of
purchase and sale;

(5) All written agreements of Kevlin with
distributors and sales agents or representatives;

(6) All written agreements of Kevlin with
customers relating to the return of products previously sold; and

(7) To Kevlin's knowledge, all oral
agreements, contracts, arrangements, commitments, understandings or
obligations to which Kevlin is a party or by which it or its
properties is or may be bound which involve more than $25,000 in the
aggregate.

Kevlin has delivered or made available to
Chelton a true and complete copy of each of the written Agreements
that involve more than $25,000, which copies accurately reflect the
understanding of Kevlin with respect to the Agreements. Kevlin has
delivered or made available to Chelton a fair and accurate summary of
each of the oral Agreements listed on EXHIBIT 3.1(p) that involve
more than $25,000. Each of the Agreements listed on EXHIBIT 3.1(p)
is a valid and binding obligation of Kevlin in accordance with its
respective terms, Kevlin has performed and complied in all material
respects with the provisions thereof, and no party is in default or
would be in default with the lapse of time or notice under the terms
of, any of the Agreements.

(q) EMPLOYEE BENEFIT PLANS.

(1) EXHIBIT 3.1(q) lists all employee pension
benefit plans (as defined in section 3(2) of the Employee Retirement
Income Security Act of 1974, as amended ("ERISA"))

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("Pension Plan"), all employee welfare benefit plans (as defined in
Section 3(1) of ERISA) ("Welfare Plan"), all specified fringe
benefit plans (as defined in section 6039D(d) of the Internal
Revenue Code of 1986, as amended (the "Code")), and all executive
compensation, retirement, supplemental retirement, deferred
compensation, incentive, bonus, severance, compensation associated
with change in control, perquisite, health care, death benefit,
medical insurance, disability insurance, life insurance, vacation
pay, sick pay or other plans, programs, and arrangements to which
Kevlin is or has during the prior six years been a party, with
respect to which Kevlin has an obligation, or that have been or are
maintained, contributed to, or sponsored by Kevlin for the benefit
of any current or former employee, officer, or director (such plans,
programs, and arrangements to be referred to collectively as
"Employee Benefit Plans"), that relate to Kevlin and are in effect
or in connection with which any obligation remains on the date of
this Agreement or that by their present terms will become effective
after the date of this Agreement. The Financial Statements
accurately reflect all commitments of Kevlin with respect to the
Employee Benefit Plans to the extent required by GAAP, and EXHIBIT
3.1(q) sets forth a description of the actuarial and accounting
valuation of each plan as of October 31, 1995 and August 31, 1995,
respectively.

(2) Kevlin has furnished to Chelton a complete
and accurate copy of each Employee Benefit Plan document (including
all amendments) and a complete and accurate copy of all documents
relating to such Employee Benefit Plan, including, if applicable:
(A) each trust agreement, insurance or annuity contract, investment
management agreement, custodial agreement, and other agreement
relating to the funding of the Employee Benefit Plan, and all
amendments to them; (B) the most recent summary plan description and
any subsequent summary of material modifications; (C) the three most
recently filed annual return reports (Form 5500 series), including
all applicable schedules; (D) the most recent determination letter
issued by the Internal Revenue Service, if the Employee Benefit Plan
is intended to be qualified under section 401(a) of the Code, the
application submitted for it, any correspondence with the Internal
Revenue Service in connection with the determination letter or
application, and any pending application for a determination letter;
(E) the three most recent financial statements; and (F) the three
most recent actuarial valuation reports. Attached as
EXHIBIT 3.1(q)(2) are correct and complete copies of the following
plans: (a) Kevlin Corporation Employee Stock Ownership Plan;
(b) 401(k) Plan Adoption Agreementand Merrill Lynch Prototype Defined
Contribution Plan Base Plan Document; (c) Kevlin Corporation
Supplemental Executive Retirement Plan; (d) Executive Deferral Plan;
(e) Objective Setting and Management Incentive Compensation Program;
(f) Executive Severance Agreements with (i) Arthur C. Williams,
(ii) Jack Moran, (iii) Jeffrey Bandrowski, (iv) Robert M. Ricci,
(v) John F. Rice; (vi) Andrew Pellerin; (vii) D. Wayne Peters and
(viii) Daniel Whelan; (g) Retirement Benefit to James Galbraith;
(h) Employment Agreement with Ernest Lattanzi; (i) Split Dollar Whole
Life

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<PAGE> 44

Insurance Policy for Marguerite Fitzgerald; (k) Executive
Supplemental Disability Income Policy and (l) a Letter Agreement
dated November 10, 1995 among Kevlin and Arthur Williams regarding
severance payments.

(3) Each Employee Benefit Plan is now and
always has been operated in all material respects in accordance with
its terms and the requirements of all applicable laws, including,
without limitation, ERISA, all provisions of the Code applicable to
secure intended tax consequences, and federal securities law, and all
regulations and rulings under such laws. All persons who participate
in the operation of the Employee Benefit Plans and all Employee
Benefit Plan fiduciaries have always acted in all material respects
in accordance with the provisions of all applicable law, including,
without limitation, ERISA, the Code, and federal securities law, and
all regulations and rulings under such laws. Kevlin has performed
all obligations required to be performed by it under, is not in any
material respect in default under or in violation of, and has no
knowledge of any material default or violation by any party to, any
Employee Benefit Plan. No legal action, suit, claim, or governmental
proceeding or investigation is pending or, to the knowledge of
Kevlin, threatened or imminent with respect to any Employee Benefit
Plan (other than claims for benefits in the ordinary course) and, to
the knowledge of Kevlin, no fact or event exists that could give rise
to any such action, suit, claim, or governmental proceeding or
investigation.

(4) The administrator of each Employee Benefit
Plan that is an "employee benefit plan" as defined in section 3(3) of
ERISA ("ERISA Plan") has complied with all applicable reporting and
disclosure requirements under Part 1 of Title I of ERISA. Each
summary plan description and summary of material modifications with
respect to each such ERISA Plan describes the ERISA Plan accurately
and comprehensively in accordance with the requirements of ERISA and
each annual report/return filed with respect to each such ERISA Plan,
including all schedules and attachments, are correct and accurate as
of the date of filing.

(5) With respect to any Pension Plan intended
to qualify under section 401(a) of the Code, each such Pension Plan
is qualified under section 401(a) of the Code and any trust through
which such Pension Plan is funded is exempt from federal income tax
under section 501(a) of the Code; a favorable determination letter
has been received from the Internal Revenue Service as to the
qualified status of such Pension Plan and trust under the Internal
Revenue Code as amended by the Tax Reform Act of 1986 and subsequent
legislation. Nothing has occurred that could adversely affect the
qualified status of such Pension Plan or trust.

(6) There has been no prohibited transaction
(within the meaning of section 406 of ERISA or section 4975 of the
Code) with respect to any ERISA Plan, other than any

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<PAGE> 45
transaction subject to a statutory or administrative exemption.
No person has acted or failed to act in connection with any Employee
Benefit Plan in a manner that would subject Kevlin to direct or indirect
liability, by indemnity or otherwise, for a breach of any fiduciary
duty.

(7) Kevlin has not incurred liability for any
excise tax arising under section 4971, 4972, 4980, or 4980B of the
Code, and no fact or event exists that could give rise to any such
liability.

(8) Kevlin has not incurred liability under
Title IV of ERISA (other than liability for premiums to the Pension
Benefit Guaranty Corporation ("PBGC") arising in the ordinary
course), and, to its knowledge, no fact or event exists that could
give rise to such liability. No complete or partial termination has
occurred within the past five years with respect to any Pension Plan.
No reportable event (within the meaning of section 4043 of ERISA) or
event described in section 4063(a) of ERISA has occurred or is
expected to occur with respect to any Pension Plan subject to Title
IV of ERISA. No proceeding has been instituted by the PBGC to
terminate any Pension Plan, nor has any notice of intent to terminate
any Pension Plan been filed with the PBGC. All premiums due the PBGC
have been paid in full on a timely basis.

(9) No Pension Plan (subject to section 302 of
ERISA or section 412 of the Code) has had an accumulated funding
deficiency (within the meaning of section 302 of ERISA or section 412
of the Code), whether or not waived. No asset of Kevlin is the
subject of a lien arising under section 302(f) of ERISA or section
412(n) of the Code. Kevlin has not been required to post security
under section 307 of ERISA or section 401(a)(29) of the Code, and no
fact or event exists that could give rise to such a lien or
requirement to post any such security.

(10) All contributions, insurance premiums, or
payments required to be made with respect to the Employee Benefit
Plans have been made by their due dates.

(11) As to each Pension Plan that is a defined
benefit plan (as defined in section 3(35) of ERISA) and that is
subject to section 302 of ERISA or section 412 of the Code, the most
recent actuarial valuation report accurately reflects the value of
the plan assets and liabilities on an on-going basis as of the date
of such valuation based on the funding method and actuarial
assumptions specified in the report, all employee census data
furnished to the plan's actuary by Kevlin in connection with such
valuation and prior valuations has been accurate and complete in all
material respects, and nothing has occurred since the date of such
valuation that would have a materially adverse effect on the funding
condition of the Pension Plan.

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<PAGE> 46

(12) Except as disclosed on EXHIBIT 3.1(q), no
Employee Benefit Plan, and no other commitment or agreement, provides
for the payment of separation, severance, or similar benefits to any
person solely as a result of any transaction contemplated by this
Agreement or as a result of a "change in control", within the meaning
of such term under section 280G of the Code, and the consummation of
the transaction contemplated by this Agreement will not accelerate
the time of payment or vesting of, or increase the amount of, any
compensation due to any employee. Kevlin has no liability under the
Executive Severance Agreement among Kevlin and Jeffrey Bandrowski,
which is referenced in EXHIBIT 3.1(n).

(13) Except as disclosed on EXHIBIT 3.1(q),
Kevlin has no liability with respect to any employee or former
employee for post-employment benefits, other than those associated
with the Pension Plans, and other than as required by section 4980B
of the Code and Part 6 of Title I of ERISA.

(14) There has been no representation made to
or communication with any employee that is not in accordance with the
existing terms and limitations of the Employee Benefit Plans. Kevlin
has made no commitment to modify any, or create any other, Employee
Benefit Plan.

(r) CONTROLLED GROUP STATUS. Kevlin has never been
a member of either (i) a controlled group (within the meaning of
section 414(b) or (c) of the Code or (ii) an affiliated service group
(within the meaning of section 414(m) or (o) of the Code).

(s) NO MULTIEMPLOYER PLANS. Kevlin has never had
any obligation to contribute to any multiemployer plan within the
meaning of section 3(37) or 4001(a)(3) of ERISA with respect to any
of its employees. Kevlin is not and could not become subject to any
withdrawal liability within the meaning of section 4201 of ERISA with
respect to any multiemployer plan. Kevlin has never been a
substantial employer within the meaning of section 4001(a)(2) of
ERISA with respect to any single-employer plan within the meaning of
section 4001(a)(15) of ERISA for which an employer could incur
liability under section 4063 or 4064 of ERISA.

(t) DEBTS AND CAPITALIZED LEASES. EXHIBIT 3.1(t)
contains a list of all liabilities under any capitalized lease of
Kevlin. The consummation of the transactions contemplated by this
Agreement will not cause the acceleration of or otherwise adversely
affect the terms or conditions of any such liabilities or
obligations.

(u) LITIGATION. Except as disclosed on
EXHIBIT 3.1(u), there are no (i) claims, suits, actions, citations,
administrative or arbitration or other proceedings or governmental
investigations pending or, to the knowledge of Kevlin, threatened
against Kevlin or to which Kevlin is a party

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or relating to any of the properties, businesses or business
practices of Kevlin or the transactions contemplated by this
Agreement (including but not limited to proceedings and
investigations related to Environmental Laws, civil rights,
discrimination in employment and occupational safety and health) or
(ii) judgments, orders, writs, injunctions or decrees of any court
or administrative agency naming the Seller or directly affecting its
assets or business.

(v) CONTINUATION OF BUSINESS. Except as otherwise
disclosed in this Agreement, Kevlin does not know of any facts or
circumstances which it reasonably expects to have a Material Adverse
Effect (as defined in SECTION 7.11(a)) on the continuance of Kevlin's
business after the Closing in the same manner as such business was
conducted by Kevlin prior to the Closing.

(w) MANAGEMENT PERSONNEL. To the knowledge of
Kevlin, none of the management personnel of Kevlin have (i) been
convicted of a criminal act (other than a minor traffic violation)
during the ten-year period immediately preceding the date of this
Agreement, or (ii) any health problem which might prevent the
individual from fulfilling his or her work responsibilities in the
foreseeable future.

(x) ABSENCE OF CHANGES. Since May 31, 1995, and
except as otherwise disclosed in this Agreement, there has not been
(i) any material adverse change in the financial condition, assets
(excluding normal wear and tear and obsolescence) or business of
Kevlin, (ii) any material damage to, destruction of or loss of the
assets, whether or not covered by insurance, (iii) any material
changes in compensation or bonus payments or arrangements for any
employees of Kevlin except as provided in SECTION 4.6, (iv) any sale
or transfer of any assets of Kevlin other than in the ordinary course
of its business and consistent with past practice, (v) any
cancellation or compromise of any debts or claims owed to Kevlin
other than in the ordinary course of its business and consistent with
past practice, (vi) any transaction not in the ordinary course of
Kevlin's business and consistent with past practice, or (vii) any
amendment or termination of any contract or agreement which
materially and adversely affects the assets or business of Kevlin.

(y) DELIVERY OF EXHIBITS. All exhibits referred to
in this SECTION 3.1 or any other exhibits referred to in this
Agreement and all documents listed in those exhibits have been
delivered to Chelton and Chelton acknowledges receipt thereof.

(z) NO SIDE AGREEMENTS. Except as separately
listed in EXHIBIT 3.1(p), Kevlin is not a party to any agreement
calling for any action by Kevlin outside of the ordinary course of
business; no agreement or understanding exists calling for any
payment or consideration from a customer or supplier of Kevlin to an
officer, director or shareholder of Kevlin respecting any transaction
between Kevlin and such supplier or customer; and no

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<PAGE> 48
affiliate of Kevlin, directly or through any business concern
affiliated with such affiliate, transacts any business with Kevlin
except for employment covered by SECTION 3.1(n) hereof.

(aa) SUPPLIERS AND TOOLING. Except as set forth in
EXHIBIT 3.1(aa), there are no sole source suppliers for any of
Kevlin's purchased parts or sub-assemblies in respect of current
sales or projected sales by Kevlin. EXHIBIT 3.1(aa) also sets forth
a list of all tooling and castings used in the manufacture of the
parts or sub-assemblies Kevlin procures from its suppliers, as well
as where the tooling is located, who owns it and whether there is any
restriction on Kevlin taking possession of or relocating same.

(ab) TITLE TO AND LOCATION OF ASSETS. Except as
disclosed in EXHIBIT 3.1(ab), there are no liens, claims, security
interests, mortgages, easements, restrictions, charges or
encumbrances affecting any of Kevlin's assets or Kevlin's leasehold
interests and Kevlin has good and marketable title to or a valid
leasehold interest in all of its assets. Except as disclosed in
EXHIBIT 3.1(ab), all of Kevlin's assets are located at Kevlin's
facility at 5 Cornell Street, Wilmington, Massachusetts.

(ac) MACHINERY AND EQUIPMENT. Kevlin's machinery
and equipment is in good operating condition and repair sufficient to
permit the conduct of its business consistent with past practice.
The machinery and equipment owned by Kevlin at the Closing will be
sufficient for the conduct of Kevlin's business and the fulfillment
of Kevlin's existing orders and will constitute substantially all
machinery and equipment used by Kevlin in its business as of May 31,
1995, except for unnecessary items or items which have been replaced
with substantially equivalent items.

(ad) PRODUCT DESIGN AND DRAWINGS; ABSENCE OF
DEFECTS. Kevlin has sufficient documentation to support the
manufacture of the products manufactured by Kevlin during the past 60
months. Kevlin is not aware of any design defect which may adversely
affect the performance or safety of any of Kevlin's products or the
ability to manufacture those products profitably.

(ae) GOVERNMENT ASSISTANCE. EXHIBIT 3.1(ae)
attached hereto describes any agreements, loans, other funding
arrangements and assistance programs (collectively called "Government
Assistance Programs") which have been provided to Kevlin from any
federal, state, municipal or other government or governmental agency,
board, commission or authority, domestic or foreign (collectively
called "Government Agencies"). Kevlin has performed all of its
obligations under the Government Assistance Programs, and no basis
exists for any Government Agencies to seek payment or repayment of
any amount or benefit provided under any of the Government Assistance
Programs.

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(af) ARRANGEMENTS WITH PROFESSIONALS. Any
arrangements of Kevlin with attorneys, accountants or other
professional advisors can be terminated by Kevlin at or after the
Closing without penalty by Kevlin (except with respect to unbilled
services rendered prior to the date of such termination).

(ag) NO LOSS CONTRACTS. Except as disclosed in
EXHIBIT 3.1(ag), to Kevlin's knowledge, Kevlin does not have any
Contract with any customer that will result in a loss to Kevlin as
determined under GAAP. For purposes of this Agreement, "Contract" or
"Contracts" shall mean those contracts and purchase and sales
commitments and orders to which Kevlin is a party or by which Kevlin
or the properties of Kevlin is or may be bound, including, without
limitation, contracts and orders providing for the purchase, receipt,
sale or distribution of goods, products or services by Kevlin, all
prepaid items and deposits of Kevlin with respect to those contracts
and Kevlin's health insurance and disability plan (but excluding all
contracts of employment and contracts relating to employees).

(ah) CUSTOMER RELATIONS. Except as set forth on
EXHIBIT 3.1(ah), since May 31, 1995, no customer of Kevlin has
terminated or communicated to Kevlin the intention or threat to
terminate its relationship with Kevlin, or the intention to
substantially reduce the quantity of products or services it
purchases from Kevlin, or its dissatisfaction with the products or
services sold by Kevlin, nor has Kevlin terminated or communicated to
any customer the intention or threat to terminate its relationship
with the customer. No amounts of money are or will become repayable
to any of Kevlin's customers under any of the Contracts relating to
performance of those Agreements prior to the Closing.

(ai) DELIVERY SCHEDULES. Kevlin and its customers
are in agreement with respect to all delivery schedules under
Kevlin's Agreements with its customers, and there are no material
delivery delays, to its knowledge, or other non-compliance by Kevlin
with the terms of those Agreements that could give rise to penalties
or cancellation of the Agreement.

(aj) FINANCIAL RECORDS. Kevlin makes and keeps
accurate books and records reflecting its assets and maintains
internal accounting controls that provide reasonable assurance that
(i) transactions are executed with management's authorization, (ii)
transactions are recorded as necessary to permit preparation of
Kevlin's financial statements and to maintain accountability for its
assets, and (iii) the book records of its assets is compared with its
actual assets at reasonable intervals.

(ak) GUARANTIES. Kevlin is not a party to any
guaranty or other credit accommodation which accommodates the credit
of another person.

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<PAGE> 50

(al) DIVIDENDS. Since May 31, 1995, Kevlin has not
declared or paid any dividends in cash or in kind upon any of its
capital stock or returned any capital to its stockholders in the form
of cash or other property or paid or made any distribution of cash or
other property to the stockholders.

(am) NO POWER OF ATTORNEY. There are no outstanding
powers of attorney granted by Kevlin except with respect to checking
accounts and those listed on EXHIBIT 3.1(am).

(an) SEC REPORTS. Kevlin has filed all required
forms, reports and documents with the SEC ("Kevlin SEC Reports")
required to be filed by it pursuant to the federal securities laws
and the SEC rules and regulations thereunder, all of which have
complied in all material respects with all applicable requirements of
the Securities Act of 1933 (the "Securities Act") and the Securities
and Exchange Act of 1934 (the "Exchange Act"), and the rules and
interpretive releases promulgated thereunder. None of such Kevlin
SEC Reports, including without limitation any financial statements,
notes, or schedules included therein, at the time filed, contained
nor contains, or, if to be filed in the future will contain, any
untrue statement of a material fact, or omitted, omits or will 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.

(ao) PROXY STATEMENT. The Proxy Statement required
for the consummation of the Merger will comply in all material
respects with the Exchange Act, except that no representation will be
made by Kevlin with respect to information supplied in writing by
Chelton or any affiliate of Chelton specifically for inclusion in the
Proxy Statement. None of the information relating to Kevlin and its
Subsidiaries shall, at the time the Proxy Statement is mailed or at
the time of the Special Meeting, 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.

(ap) MANAGEMENT SHARES. The officers, directors and
Kevlin Corporation Employee Stock Ownership Plan, own, in the
aggregate, 13.7% of the outstanding Kevlin Stock.

(aq) STATUS OF FLOW VISION. Attached hereto as
EXHIBIT 3.1(aq) is a copy of all correspondence relating to pending
claims under the agreement by which Kevlin sold most of the assets of
Flow Vision Inc. (a Massachusetts corporation) (the "Flow Vision
Agreement"). To Kevlin's knowledge, there are no past or current
events or circumstances that could give rise to claims against Kevlin
under the provisions of the Flow Vision Agreement. Kevlin has
received written confirmation from the purchaser under the Flow
Vision Agreement that there can be no further claims against Kevlin
for product warranty claims under

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<PAGE> 51
the Flow Vision Agreement; a copy of this written confirmation is
included in EXHIBIT 3.1(aq).

(ar) TRUTH OF REPRESENTATIONS. On the date of this
Agreement and on the date of the Closing, no representation or
warranty of Kevlin in this Agreement, nor any written statement or
certificate executed by Kevlin and furnished or to be furnished to
Chelton pursuant to this Agreement or in connection with the
transactions contemplated hereby, contains or will contain any untrue
statement of a material fact or omits or will omit to state a
material fact necessary to make the statements contained therein, in
light of the circumstances under which they were made, not
misleading.

Section 3.2 REPRESENTATIONS AND WARRANTIES OF CHELTON
AND NEWCO. Chelton and NEWCO, each jointly and severally, represent
and warrant to Kevlin that:

(a) CORPORATE STANDING AND AUTHORITY. Chelton and
NEWCO are corporations duly organized, validly existing and in good
standing under the laws of the State of Delaware and Massachusetts,
respectively, and have full corporate power and authority to carry on
their current business operations and consummate the transactions
contemplated by this Agreement. The execution of this Agreement and
consummation of the transactions contemplated herein will not violate
any provision of Chelton's or NEWCO's By-Laws, or Certificate of
Incorporation or Articles of Incorporation or any law, regulation or
ordinance or any provision of any contract, instrument, order, award,
judgment or decree to which Chelton or NEWCO is a party or by which
Chelton and NEWCO are bound. This Agreement is a legal, valid and
binding agreement of Chelton and NEWCO enforceable against Chelton
and NEWCO in accordance with its terms, subject to the laws of
bankruptcy, insolvency and moratorium and other laws or equitable
principles generally affecting creditors' rights and to general
equitable principles. Chelton and NEWCO have obtained all necessary
authorization and approval by their Boards of Directors and, in the
case of NEWCO, by its sole stockholder, for the execution of this
Agreement and the consummation of the transactions contemplated
hereby, and no other corporate action is necessary by either Chelton
or NEWCO for the execution of this Agreement and the consummation of
the transactions contemplated hereby. No consent, authorization,
order or approval of any person, governmental authority or any court
is required in connection with the execution and delivery by Chelton
and NEWCO of this Agreement or the consummation by Chelton and NEWCO
of the transactions contemplated hereby other than as contemplated by
Section 5.2(g) hereof.

(b) LITIGATION. There is no litigation pending or,
to the knowledge of Chelton or NEWCO, threatened against Chelton or
NEWCO which seeks to prevent, or if successful would prevent, Chelton
or NEWCO from consummating the Merger.

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(c) PROXY STATEMENT. None of the information
furnished in writing by Chelton relating to Chelton, NEWCO and their
subsidiaries for use in the Proxy Statement shall, at the time the
Proxy Statement is mailed or at the time of the Special Meeting,
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.

(d) TRUTH OF REPRESENTATIONS. On the date of this
Agreement and on the date of the Closing, no representation or
warranty of Chelton or NEWCO in this Agreement, nor any written
statement or certificate executed by Chelton and furnished or to be
furnished to Kevlin pursuant to this Agreement or in connection with
the transactions contemplated hereby contains or will contain any
untrue statement of a material fact or omits or will omit to state a
material fact necessary to make the statements contained therein not
misleading.

ARTICLE IV
COVENANTS

Section 4.1 CONDUCT OF BUSINESS OF KEVLIN. Except as
otherwise contemplated by this Agreement or disclosed in the Exhibits
hereto, during the period from the date of this Agreement to the
Effective Time, Kevlin and its Subsidiaries will each conduct their
operations according to their ordinary and usual course of business
and consistent with past practice. Without limiting the generality
of the foregoing, and except as otherwise expressly provided in this
Agreement or disclosed in the Exhibits hereto, neither Kevlin nor any
of its Subsidiaries will, prior to the Effective Time, without the
prior written consent of Chelton (a) issue, sell or pledge, or
authorize or propose the issuance, sale or pledge of (i) additional
shares of capital stock of any class, or securities convertible into
any such shares, or any rights, warrants or options to acquire any
such shares or other convertible securities, other than pursuant to
commitments outstanding at the date hereof, or (ii) any other
securities in respect of, in lieu of or in substitution for, capital
stock outstanding on the date hereof, (b) purchase or otherwise
acquire, or propose to purchase or otherwise acquire, any of its
outstanding securities, (c) declare or pay any dividend or
distribution on any shares of its capital stock, (d) authorize,
recommend, propose or announce an intention to authorize, recommend
or propose, or enter into an agreement in principle or an agreement
with respect to, any merger, consolidation or business combination
(other than the Merger), any acquisition of a material amount of
assets or securities, any disposition of a material amount of assets
or securities or any material change in its capitalization, or any
entry into a material contract or any release or relinquishment of
any material contract rights, not in the ordinary course of business,
(e) propose or adopt any amendments to its charter or by-laws, (f)
enter into, assign or terminate, or amend in any material

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respect, any Agreement other than in the ordinary course of business,
(g) acquire, dispose of, encumber or relinquish any material asset
other than in the ordinary course of business, (h) waive, compromise
or settle any right or claim that would adversely affect the
ownership, operation or value of any material asset, (i) make any
material capital expenditures other than pursuant to existing capital
expenditure programs that are disclosed in EXHIBIT 4.1(i), (j) allow
or permit the expiration, termination or cancellation at any time
prior to the Effective Time of any of the insurance policies or
coverages or surety bonds currently maintained by or on behalf of
Kevlin unless replaced with a policy, coverage or bond having
substantially the same coverage and similar terms and conditions, (k)
waive, settle or compromise any material litigation or other material
claim on a basis materially adverse to Kevlin or its Subsidiaries,
(l) agree in writing or otherwise to take any of the foregoing
actions or any action which would make any representation or warranty
in this Agreement untrue or incorrect in any material respect or
(m) incur any indebtedness for borrowed money (other than any
indebtedness in place at the date of this Agreement).

Section 4.2 ACCESS TO INFORMATION.

(a) Between the date of this Agreement and the
Effective Time, Kevlin will afford to Chelton and its authorized
representatives full access during normal business hours to the real
estate, offices, warehouses or other facilities and to the books and
records of Kevlin and its Subsidiaries, will permit Chelton and its
representatives to make such inspections as they may require during
normal business hours and will cause Kevlin's officers to furnish
Chelton and its representatives with such financial and operating
data, environmental assessments and other information with respect to
the business and real property of Kevlin and its Subsidiaries as
Chelton and its representatives may from time to time reasonably
request. No inspection or examination by Chelton will constitute a
waiver of any claim against Kevlin for misrepresentation or breach of
this Agreement.

(b) The parties will hold and will cause their
representatives to hold in strict confidence, unless compelled to
disclose by judicial or administrative process (as to which it will
give the other party notice and an opportunity to contest
disclosure), or, in the opinion of counsel, by other requirements of
law, all documents and information concerning the parties furnished
to them and their representatives in connection with the transactions
contemplated by this Agreement (except to the extent that such
information can be shown to have been (i) in the public domain
through no fault of the parties or their representatives or
(ii) later lawfully acquired by the parties or their representatives
from other sources, which acquisition can be demonstrated in writing
by the disclosing party, unless they or their representatives know
that such other sources are not entitled to disclose such
information) and will not use such information or release or disclose
such information to any other person, except their auditors,
attorneys, financial advisors and

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other consultants and advisors in connection with this Agreement,
provided that such person shall have first been advised of the
confidentiality provision of this SECTION 4.2. If the transactions
contemplated by this Agreement are not consummated, such confidence
shall be maintained except to the extent such information can be shown
to have been (i) in the public domain through no fault of Chelton,
NEWCO or Kevlin, as the case may be, or their respective representatives
or (ii) later lawfully acquired by the parties or representatives from
other sources, which acquisition can be demonstrated in writing by the
disclosing party, and, if requested, either party will, and will cause
its agents, auditors, consultants, representatives and advisors to return
to the other, or destroy, all copies of written information furnished.

(c) Kevlin agrees to furnish Chelton at the time of
filing with copies of all reports and filings (including exhibits and
schedules) filed by Kevlin with the SEC between the date hereof and
the Closing.

Section 4.3 BEST EFFORTS. Subject to the terms and
conditions herein provided, and to the fiduciary duties of the Boards
of Directors of the parties under applicable law, each of the parties
hereto agrees to use its best efforts to take, or cause to be taken,
all action, and to do, or cause to be done, all things necessary,
proper or advisable under applicable laws and regulations to
consummate and make effective the transactions contemplated by this
Agreement. In case at any time after the Effective Time any further
action is necessary or desirable to carry out the purposes of this
Agreement, the proper officers and directors of each party to this
Agreement shall take all such necessary action.

Section 4.4 CONSENTS. Chelton and Kevlin each will
use its best efforts to obtain such consents of third parties to
agreements which would otherwise be violated by any provisions
hereof, to take all actions necessary to effect the transactions
contemplated hereby, and to make such filings with Governmental
Authorities necessary to consummate the transactions contemplated by
this Agreement including, without limitation, (a) the vigorous
defense of any lawsuits or other legal proceedings, whether judicial
or administrative, challenging this Agreement or the consummation of
the transaction contemplated hereby unless in the good faith judgment
of the party against whom the lawsuit or other legal proceeding is
brought the claims against such party have a reasonable likelihood of
success, including seeking to have any stay or temporary restraining
order entered by any court or governmental authority vacated or
reviewed, and (b) the execution and delivery of any additional
instruments reasonably necessary to consummate the transactions
contemplated by this Agreement.

Section 4.5 PUBLIC ANNOUNCEMENTS. Except as required
by law or other regulatory body, neither party shall make any news
releases or other public announcement pertaining to

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the existence of this Agreement or the Merger without the prior consent
of the other party hereto. To the extent such a release or announcement is
required by law, the party making the same shall give the other party
advance notice of, and an opportunity to comment on, the proposed
release or announcement.

Section 4.6 CERTAIN PAYMENTS. The parties agree that
Kevlin will be permitted to make certain payments in connection with
the Merger as follows:

(a) up to $100,000, in the aggregate, to the staff
of Kevlin, to be apportioned as determined by Kevlin's Board of
Directors, as set forth in EXHIBIT 4.6(a); and

(b) up to $256,033, in the aggregate, to Kevlin's
non-employee directors in full and final payment for their services
on behalf of Kevlin as set forth in EXHIBIT 4.6(b).

Section 4.7 FUNDING OF NEWCO. Prior to the Closing,
Chelton shall cause NEWCO to be funded with an amount of cash
sufficient to pay the aggregate Merger Consideration for the
outstanding Shares and Stock Options.

Section 4.8 INSURANCE. Chelton shall use its best
efforts to obtain and maintain for a period of one year after the
Effective Time an endorsement extending the period in which claims
may be made under Kevlin's directors' and officers' liability
insurance policy in effect on the date of this Agreement, or a policy
of such other responsible carrier as Chelton may elect, with respect
to causes of action that arise out of facts or omissions occurring on
or before the Effective Time; provided, however, that in no event
shall Chelton be required to expend pursuant to this section more
than an amount per year equal to 125% of current annual premiums paid
by Kevlin for such insurance.

ARTICLE V
CONDITIONS TO CONSUMMATION OF THE MERGER

Section 5.1 CONDITIONS TO KEVLIN'S OBLIGATION TO
CLOSE. The obligations of Kevlin at Closing shall be subject to
satisfaction of the following conditions at Closing:

(a) REPRESENTATIONS AND WARRANTIES. The
representations and warranties of Chelton and NEWCO set forth in
SECTION 3.2 hereof shall be true and correct as of the date of this
Agreement and as of Closing as though those representations and
warranties had been made at and as of that time, and Kevlin shall
have received at Closing a certificate signed by Chelton's President
to that effect.

(b) NO LITIGATION. There shall not have been
instituted or threatened on or before Closing any action or

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proceeding to restrict or prohibit the transactions contemplated by
this Agreement.

(c) MERGER CONSIDERATION. NEWCO shall present
evidence reasonably satisfactory to Kevlin that, immediately prior to
the Closing, it has cash on hand equal to or greater than the
aggregate Merger Consideration for the outstanding Shares and Stock
Options.

(d) APPROVAL OF KEVLIN'S STOCKHOLDERS. The
approval of Kevlin's stockholders of this Agreement and the Merger as
required by the Massachusetts Act shall have been obtained.

(e) RECEIPT OF CONSENTS. Any consents from third
parties required to be obtained by Kevlin to effect the Merger shall
have been obtained by Kevlin.

(f) OPINION OF CHELTON AND NEWCO'S COUNSEL.
Chelton and NEWCO shall have delivered to Kevlin an opinion of
Jaeckle, Fleischmann & Mugel, dated as of the Closing, in form and
substance satisfactory to Kevlin, with respect to the matters set
forth in SECTIONS 3.2(a), (b) and (d) of this Agreement.

Section 5.2 CONDITIONS TO CHELTON'S AND NEWCO'S
OBLIGATION TO CLOSE. The obligations of Chelton and NEWCO at Closing
shall be subject to satisfaction of the following conditions at
Closing:

(a) REPRESENTATIONS, WARRANTIES AND COVENANTS. The
representations and warranties of Kevlin set forth in SECTION 3.1
hereof shall be true and correct as of the date of this Agreement and
as of Closing as though those representations and warranties had been
made at and as of that time, the covenants contained in SECTIONS 2.3,
4.1 and 4.2(a), hereof shall have been performed, and Chelton and
NEWCO shall have received at Closing a certificate signed by each of
Kevlin's officers (currently, Jonathan Donaldson, Wayne Peters, John
Moran, Robert Ricci) to that effect.

(b) NO LITIGATION. There shall not have been
instituted or threatened any action, proceeding or investigation to
restrict or prohibit the transactions contemplated by this Agreement
or which would give rise to material damages to Kevlin or have a
Material Adverse Effect on the value of the assets of Kevlin.

(c) APPROVAL OF KEVLIN'S STOCKHOLDERS. The
approval of Kevlin's stockholders of this Agreement and the Merger as
required by the Massachusetts Act shall have been obtained.

(d) RECEIPT OF CONSENTS. All consents from third
parties required to be obtained by Kevlin to effect the Merger

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shall have been obtained by Kevlin in form and substance reasonably
satisfactory to Chelton and NEWCO.

(e) OPINION OF KEVLIN'S COUNSEL. Kevlin shall have
delivered to Chelton and NEWCO an opinion of Palmer & Dodge, dated as
of the Closing, in form and substance reasonably satisfactory to
Chelton and NEWCO, with respect to the matters set forth in SECTIONS
3.1(a) (other than as to qualification as a foreign corporation or
the last sentence of that section) and (d) of this Agreement, as well
as whether there exists, to Palmer & Dodge's knowledge, any pending
litigation which seeks to prevent, or if successful would prevent,
Kevlin from consummating the Merger.

(f) RESIGNATION LETTERS. Kevlin shall have
obtained letters of resignation from each officer and director in
office immediately prior to the Effective Time.

(g) CONTINUATION OF INSURANCE. Chelton
shall have received confirmation from Kevlin's insurers that the
insurance policies listed in EXHIBIT 3.1(l) will continue in effect
after the Closing notwithstanding the Merger.

(h) ENVIRONMENTAL STUDY. Chelton shall have
received an environmental study from an environmental consulting firm
approved by Chelton relating to Kevlin's Facilities that, in
Chelton's reasonable judgment, indicates that there are no
significant risks associated with Hazardous Materials or violations
of any Environmental Laws at Kevlin's Facilities.

(i) STOCK OPTIONS. At or prior to the Closing, all
Stock Options shall have been exercised (or terminated) as described
in SECTION 1.6(d).

Section 5.3 OTHER CONDITIONS. The respective
obligations of each party to effect the Merger are subject to the
condition that no statute, rule, regulation, executive order, decree,
or injunction shall have been enacted, entered, promulgated or
enforced by any court of competent jurisdiction in the United States
or domestic governmental authority which prohibits or restricts the
consummation of the Merger.

Section 5.4 NO SOLICITATION.

(a) Other than as required by their fiduciary
responsibilities, the Board of Directors of Kevlin shall not
negotiate an Acquisition Proposal (as defined below) with a Third
Party unless and until this Agreement has been terminated in
accordance with the provisions hereof.

(b) Neither Kevlin nor any of its subsidiaries
shall, directly or indirectly, take (nor shall Kevlin authorize or
permit its subsidiaries, officers, directors, employees,
representatives, investment advisors, bankers, attorneys, accountants
or other agents or affiliates, to take) any action to

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(i) encourage, solicit or initiate the submission of any Acquisition
Proposal (as defined below), (ii) enter into any agreement with respect
to any Acquisition Proposal or (iii) participate in discussions or
negotiations with, or furnish any information to, any person in
connection with any Acquisition Proposal; provided, that, to the
extent required by the fiduciary obligations of the Board of
Directors of Kevlin (as determined in good faith by the Board of
Directors of Kevlin based upon written advice of Palmer & Dodge),
upon receipt of (x) an unsolicited and written Superior Proposal (as
defined in SECTION 5.4(c) below) or (y) an unsolicited and written
Potential Superior Proposal (as defined below), Kevlin may: (1) take
the action referred to in clause (ii) of this sentence with respect
to such Superior Proposal or Potential Superior Proposal but only in
connection with a simultaneous termination of this Agreement in
accordance with SECTION 6.1, and (2) take any of the actions referred
to in clause (iii) of this sentence with respect to such Superior
Proposal or Potential Superior Proposal. A "Potential Superior
Proposal" shall mean a proposal that a majority of the disinterested
members of the Board of Directors of Kevlin determines in its good
faith judgment to be reasonably likely to lead to a Superior Proposal
(as defined in SECTION 5.4(c) below). "Acquisition Proposal" shall
mean, except for the transactions contemplated by this Agreement, any
proposed (i) merger, consolidation or similar transaction involving
Kevlin, (ii) sale, lease or other disposition directly or indirectly
by merger, consolidation, share exchange or otherwise of assets of
Kevlin or it subsidiaries representing 10% or more of the
consolidated assets of Kevlin and its subsidiaries, (iii) issue, sale
or other disposition of (including by way of merger, consolidation,
share exchange or any similar transaction) securities (or options,
rights or warrants to purchase, or securities convertible into, such
securities) representing 10% or more of the voting power of Kevlin or
(iv) transaction in which any person shall acquire beneficial
ownership (as such term is defined in Rule 13d-3 under the Exchange
Act), or the right to acquire beneficial ownership or any "group" (as
such term is defined under the Exchange Act) shall have been formed
which beneficially owns or has the right to acquire beneficial
ownership of 10% or more of the outstanding Kevlin Common Stock.
Kevlin shall notify Chelton promptly of any Acquisition Proposal and
shall provide Chelton with all available information with respect
thereto.

(c) The provisions of SECTION 5.4(a) shall not be
deemed to prohibit the Board of Directors of Kevlin, prior to the
consummation of the Merger, from withdrawing or modifying its
approval or recommendation of the Merger or this Agreement, if a
Superior Proposal is made, provided that (i) such action is required
by the fiduciary obligations of the Board of Directors of Kevlin as
determined in good faith by a majority of the disinterested members
thereof, taking into account (x) the financial and other terms and
conditions of the Superior Proposal and (y) the time period within
which the transactions contemplated by such Superior Proposal can be
consummated and (ii) the Board of Directors of Kevlin shall have
received the

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written opinion of Palmer & Dodge to the effect that such action
is required by the fiduciary obligations of the Board of Directors
of Kevlin. For purposes of this Agreement, "Superior Proposal"
means a bona fide proposal made by a Third Party to acquire all the
outstanding Kevlin Common Stock or all or substantially all the assets
of Kevlin pursuant to a tender or exchange offer, a merger or
otherwise on terms which a majority of the disinterested members of
the Board of Directors of Kevlin determine in its good faith judgment
to be financially superior to Kevlin's stockholders than the Merger
(based on a good faith determination that the value of such proposal,
as a whole, exceeds the value of the consideration provided for in the
Merger plus the amount of the Termination Fee, as hereinafter defined).
For purposes of this Agreement, "Third Party" shall mean any
corporation, partnership, person or other entity or "group" (as
defined in Section 13(d)(3) of the Exchange Act) other than Chelton,
any affiliate of Chelton or any of their respective directors,
trustees, officers, employees, representatives and agents or any
entity controlled by one or more such persons.

(d) Kevlin shall pay to Chelton upon demand an
amount in cash equal to $1,000,000 (the "Termination Fee") if:
(i) Kevlin terminates this Agreement pursuant to SECTION 6.1(f) or
(ii) Chelton and NEWCO terminate this Agreement pursuant to
SECTION 6.1(c) for the reason that any of the conditions specified in
SECTIONS 5.2(a), have not been met as a result of the intentional,
deliberate or fraudulent misrepresentation or breach of covenant by
Kevlin and are not capable of being met on or before March 31, 1996.

ARTICLE VI
TERMINATION; AMENDMENTS; WAIVER

Section 6.1 TERMINATION. This Agreement may be
terminated and the Merger contemplated hereby may be abandoned at any
time, notwithstanding approval thereof by the shareholders of Kevlin,
prior to the Effective Time:

(a) by mutual written consent duly authorized by
the Boards of Directors of Kevlin, Chelton and NEWCO;

(b) by Chelton or Kevlin if the Effective Time
shall not have occurred on or before March 31, 1996 (providing the
terminating party is not otherwise in material breach of its
representations, warranties or obligations under this Agreement);

(c) by Chelton and NEWCO if any of the conditions
specified in SECTION 5.2 shall not have been met or waived by them at
such time as such condition is no longer capable of satisfaction;

(d) by Kevlin if any of the conditions specified in
SECTION 5.1 shall not have been met or waived by it at such time as
such condition is no longer capable of satisfaction;

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(e) by Chelton or Kevlin: (i) if any court of
competent jurisdiction or other governmental authority shall have
issued an order, decree or ruling or taken any other action
restraining, enjoining or otherwise prohibiting the Merger, (ii) if
litigation or proceedings shall be pending that are reasonably likely
to result in any of the foregoing or (iii) the condition specified in
SECTION 5.3 cannot be met;

(f) by Kevlin if all of the following conditions
are satisfied: (i) prior to the consummation of the Merger, Kevlin
or its Board of Directors shall have received a Superior Proposal
from a Third Party, (ii) the Board of Directors of Kevlin shall have
received the written opinion of Palmer & Dodge to the effect that the
fiduciary obligations of the Board of Directors require that Kevlin
terminate this Agreement and enter into an agreement with respect to
the Superior Proposal, (iii) the Board of Directors of Kevlin shall
have resolved to enter into definitive documentation with respect to
the Superior Proposal within 48 hours of the termination of this
Agreement and (iv) Kevlin shall have paid to Chelton an amount in
cash equal to the Termination Fee.

Section 6.2 EFFECT OF TERMINATION. In the event of
the termination and abandonment of this Agreement pursuant to
SECTION 6.1, this Agreement shall forthwith become void and have no
effect, without any liability on the part of any party or its
directors, officers, or shareholders, except (i) to the extent
applicable, the provisions of SECTIONS 4.2(b), 5.4(d) and 7.9 and
(ii) if the termination is pursuant to SECTIONS 6.1(c) or (d), the
non-terminating party shall reimburse the terminating party for its
costs and expenses incurred in connection with the Merger (including
without limitation legal and accounting fees, travel expenses and
other out of pocket expenses incurred in due diligence investigations
and contract negotiations) up to a maximum of $150,000, which
reimbursement shall be made immediately upon submission to the
non-terminating party of the terminating party's written records with
respect to such costs and expenses.

Section 6.3 AMENDMENT. This Agreement may be amended
by action taken by or on behalf of the Boards of Directors of Kevlin,
Chelton and NEWCO at any time before or after adoption of this
Agreement by the stockholders of Kevlin but, after any such approval,
no amendment shall be made which decreases the Merger Consideration
per Share or which adversely affects the rights of Kevlin's
stockholders hereunder without the approval of such shareholders.
This Agreement may not be amended except by an instrument in writing
signed on behalf of Kevlin, Chelton and NEWCO.

Section 6.4 EXTENSION; WAIVER. At any time prior to
the Effective Time, the parties hereto, by action taken by or on
behalf of the respective Boards of Directors of Kevlin, Chelton and
NEWCO may (a) extend the time for the performance of any of the
obligations or other acts of any other applicable party

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hereto, (b) waive any inaccuracies in the representations and warranties
contained herein by any other applicable party or in any document,
certificate or writing delivered pursuant hereto by any other
applicable party, or (c) subject to the proviso contained in
SECTION 6.3, waive compliance with any of the agreements of any other
applicable party or with any conditions to its own obligations. Any
agreement on the part of any other applicable party to any such
extension or waiver shall be valid only if set forth in an instrument
in writing signed on behalf of such party.

ARTICLE VII
MISCELLANEOUS

Section 7.1 SURVIVAL OF REPRESENTATIONS AND
WARRANTIES. The representations and warranties made in this
Agreement shall not survive beyond the Effective Time. This
SECTION 7.1, however, shall not limit any covenant or agreement of
the parties hereto, which by its terms contemplates performance after
the Effective Time.

Section 7.2 BROKERAGE FEES; COMMISSIONS AND EXPENSES.
Kevlin hereby represents and warrants to Chelton with respect to
Kevlin, and Chelton and NEWCO hereby represent and warrant to Kevlin
with respect to Chelton and NEWCO, that, except as set forth in
EXHIBIT 7.2, no person or entity is entitled to receive from Kevlin
on the one hand, or Chelton and NEWCO, on the other hand, any
investment banking, brokerage or finder's fee or fees for financial
consulting or advisory services in connection with this Agreement or
the transactions contemplated hereby. Other costs, expenses and
liabilities which may be incurred in connection with the consummation
of this Agreement or the Merger, such as, for example and without
limitation, the cost of professional fees shall be paid by the party
incurring the cost.

Section 7.3 ENTIRE AGREEMENT; ASSIGNMENT. This
Agreement (a) constitutes the entire agreement among the parties with
respect to the subject matter hereof and supersedes all other prior
agreements and understandings, both written and oral, among the
parties or any of them with respect to the subject matter hereof and
(b) shall not be assigned by operation of law or otherwise.

Section 7.4 VALIDITY. The invalidity or
unenforceability of any provision of this Agreement shall not affect
the validity or enforceability of any other provisions of this
Agreement, each of which shall remain in full force and effect.

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Section 7.5 NOTICES. All notices and other
communications hereunder shall be in writing and shall be deemed
given when delivered by overnight courier, when sent by confirmed
facsimile or three days after being mailed by registered or certified
mail (return receipt requested) to the parties at the following
addresses (or at such address for a party as shall be specified by
like notice):

If to Kevlin:

Kevlin Corporation
5 Cornell Place
Wilmington, Massachusetts 01887
Attention: Mr. Jonathan D. Donaldson

Copies of notices to Kevlin shall be sent to:

Palmer & Dodge
One Beacon Street
Boston, Massachusetts 02108
Attention: Leon J. Glazerman, Esq.
Marc A. Rubenstein, Esq.

If to Chelton and NEWCO:

Chelton Communication Systems, Inc.
c/o Chelton Ltd.
Fieldhouse Lane, Marlow
Buckinghamshire, England SL7 1LR
Attention: Mr. Paul D. Long

Chelton Communication Systems, Inc.
179 Avenue of the Commons, Suite One
Shrewsbury, New Jersey 07702
Attention: Mr. David V. Gaggin

Copies of notices to Chelton and NEWCO shall be
sent to:

Jaeckle, Fleischmann & Mugel
800 Fleet Bank Building
12 Fountain Plaza
Buffalo, New York 14202-2292
Attention: Charles F. Horne, IV, Esq.
Colleen A. Van Gelder, Esq.

Section 7.6 GOVERNING LAW. This Agreement shall be
governed by and construed in accordance with the laws of the
Commonwealth of Massachusetts, regardless of the laws that might
otherwise govern under applicable principles of conflicts of laws
thereof.

Section 7.7 DESCRIPTIVE HEADINGS. The descriptive
headings herein are inserted for convenience of reference only

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andare not intended to be part of or to affect the meaning or
interpretation of this Agreement.

Section 7.8 COUNTERPARTS. This Agreement may be
executed in two or more counterparts, each of which shall be deemed
to be an original, but all of which shall constitute one and the same
agreement.

Section 7.9 EXPENSES. Except as otherwise provided
herein, each of the parties shall bear and pay all costs and expenses
incurred by it or on its behalf in connection with the transactions
contemplated hereunder, including fees and expenses of its own
financial or other consultants, investment bankers, accountants and
counsel.

Section 7.10 SPECIFIC PERFORMANCE. The parties hereto
agree that irreparable damage would occur in the event that any of
the provisions of this Agreement were not performed in accordance
with their specific terms or were otherwise breached. It is
accordingly agreed that the parties shall be entitled to an
injunction or injunctions to prevent breaches of this Agreement and
to enforce specifically the terms and provisions hereof in any court
of the United States or any state having jurisdiction, this being in
addition to any other remedy to which they are entitled at law or in
equity.

Section 7.11 CERTAIN DEFINITIONS.

(a) "Material Adverse Effect" shall mean any
adverse change in the financial condition, assets, business or
operations of any party which is material to such party and its
subsidiaries taken as a whole.

(b) "Special Meeting" shall mean the special
meeting of the shareholders of the Company called pursuant to the
Proxy Statement to consider approval of the Merger.

(c) "Subsidiary" shall mean, when used with
reference to an entity, any corporation, a majority of the
outstanding voting securities of which are owned directly or
indirectly by such entity. Such term shall also refer to any other
partnership, limited partnership, joint venture, trust, or other
business entity in which a party hereto owns a majority interest.

Section 7.12 PERFORMANCE BY NEWCO. Chelton agrees to
cause NEWCO to comply with its obligations hereunder and to cause
NEWCO to consummate the Merger as contemplated herein.

Section 7.13 PARTIES IN INTEREST. This Agreement shall
be binding upon and inure solely to the benefit of each party hereto,
and nothing in this Agreement, express or implied, is intended to or
shall confer upon any other person or persons any rights, benefits or
remedies of any nature whatsoever under or by reason of this
Agreement.

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Each of the parties has caused this Agreement to be
executed on its behalf by its duly authorized officers as of the day
and year set forth above.

KEVLIN CORPORATION

By: /s/ Jonathan D. Donaldson
-------------------------------
Jonathan D. Donaldson, Chairman

KEVLIN ACQUISITION CORP.

By: /s/ David V. Gaggin
-------------------------------
David V. Gaggin, President

CHELTON COMMUNICATION SYSTEMS, INC.

By: /s/ David V. Gaggin
--------------------------------
David V. Gaggin, President

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EXHIBIT B

M.G.L.A. Chapter 156B

Sec. 85. Dissenting stockholder; right to demand payment for stock; exception

A stockholder in any corporation organized under the laws of Massachusetts
which shall have duly voted to consolidate or merge with another corporation
or corporations under the provisions of sections seventy-eight or
seventy-nine who objects to such consolidation or merger may demand payment
for his stock from the resulting or surviving corporation and an appraisal in
accordance with the provisions of sections eighty-six to ninety-eight,
inclusive, and such stockholder and the resulting or surviving corporation
shall have the rights and duties and follow the procedure set forth in those
sections. This section shall not apply to the holders of any shares of stock
of a constituent corporation surviving a merger if, as permitted by subsection
(c) of section seventy-eight, the merger did not require for its approval a
vote of the stockholders of the surviving corporation.

Sec. 86. Sections applicable to appraisal; prerequisites

If a corporation proposes to take a corporate action as to which any
section of this chapter provides that a stockholder who objects to such action
shall have the right to demand payment for his shares and an appraisal
thereof, sections eighty-seven to ninety-eight, inclusive, shall apply except
as otherwise specifically provided in any section of this chapter. Except as
provided in sections eighty-two and eighty-three, no stockholder shall have
such right unless (1) he files with the corporation before the taking of the
vote of the shareholders on such corporate action, written objection to the
proposed action stating that he intends to demand payment for his shares if the
action is taken and (2) his shares are not voted in favor of the proposed
action.

Sec. 87. Statement of rights of objecting stockholders in notice of meeting;
form

The notice of the meeting of stockholders at which the approval of such
proposed action is to be considered shall contain a statement of the rights of
objecting stockholders. The giving of such notice shall not be deemed to
create any rights in any stockholder receiving the same to demand payment for
his stock, and the directors may authorize the inclusion in any such notice of
a statement of opinion by the management as to the existence or non-existence
of the right of the stockholders to demand payment for their stock on account
of the proposed corporate action. The notice may be in such form as the
directors or officers calling the meeting deem advisable, but the following
form of notice shall be sufficient to comply with this section:

"If the action proposed is approved by the stockholders at the meeting
and effected by the corporation, any stockholder (1) who files with the
corporation before the taking of the vote on the approval of such action,
written objection to the proposed action stating that he intends to demand
payment for his shares if the action is taken and (2) whose shares are not
voted in favor of such action

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has or may have the right to demand in writing from the corporation (or, in the
case of a consolidation or merger, the name of the resulting or surviving
corporation shall be inserted), within twenty days after the date of mailing
to him of notice in writing that the corporate action has become effective,
payment for his shares and an appraisal of the value thereof. Such
corporation and any such stockholder shall in such cases have the rights and
duties and shall follow the procedure set forth in sections 88 to 98,
inclusive, of chapter 156B of the General Laws of Massachusetts."

Sec. 88. Notice of effectiveness of action objected to

The corporation taking such action, or in the case of a merger or
consolidation the surviving or resulting corporation, shall, within ten days
after the date on which such corporate action became effective, notify each
stockholder who filed a written objection meeting the requirements of section
eighty-six and whose shares were not voted in favor of the approval of such
action, that the action approved at the meeting of the corporation of which he
is a stockholder has become effective. The giving of such notice shall not be
deemed to create any rights in any stockholder receiving the same to demand
payment for his stock. The notice shall be sent by registered or certified
mail, addressed to the stockholder at his last known address as it appears in
the records of the corporation.

Sec. 89. Demand for payment; time for payment

If within twenty days after the date of mailing of a notice under
subsection (e) of section eighty-two, subsection (f) of section eighty-three,
or section eighty-eight, any stockholder to whom the corporation was required
to give such notice shall demand in writing from the corporation taking such
action, or in the case of a consolidation or merger from the resulting or
surviving corporation, payment for his stock, the corporation upon which such
demand is made shall pay to him the fair value of his stock within thirty days
after the expiration of the period during which such demand may be made.

Sec. 90. Demand for determination of value; bill in equity; venue

If during the period of thirty days provided for in section eighty-nine
the corporation upon which such demand is made and any such objecting
stockholder fail to agree as to the value of such stock, such corporation or
any such stockholder may within four months after the expiration of such
thirty-day period demand a determination of the value of the stock of all such
objecting stockholders by a bill in equity filed in the superior court in the
county where the corporation in which such objecting stockholder held stock
had or has its principal office in the commonwealth.

Sec. 91. Parties to suit to determine value; service

If the bill is filed by the corporation, it shall name as parties respondent
all stockholders who have demanded payment for their shares and with whom the
corporation has not reached agreement as to the value thereof. If the bill is
filed by a stockholder, he shall bring the bill in his own behalf and in

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behalf of all other stockholders who have demanded payment for their shares
and with whom the corporation has not reached agreement as to the value
thereof, and service of the bill shall be made upon the corporation by
subpoena with a copy of the bill annexed. The corporation shall file
with its answer a duly verified list of all such other stockholders, and such
stockholders shall thereupon be deemed to have been added as parties to the
bill. The corporation shall give notice in such form and returnable on such
date as the court shall order to each stockholder party to the bill by
registered or certified mail, addressed to the last known address of such
stockholder as shown in the records of the corporation, and the court may
order such additional notice by publication or otherwise as it deems advisable.
Each stockholder who makes demand as provided in section eighty-nine shall be
deemed to have consented to the provisions of this section relating to notice,
and the giving of notice by the corporation to any such stockholder in
compliance with the order of the court shall be a sufficient service of
process on him. Failure to give notice to any stockholder making demand shall
not invalidate the proceedings as to other stockholders to whom notice was
properly given, and the court may at any time before the entry of a final
decree make supplementary orders of notice.

Sec. 92. Decree determining value and ordering payment; valuation date

After hearing the court shall enter a decree determining the fair value
of the stock of those stockholders who have become entitled to the valuation
of and payment for their shares, and shall order the corporation to make
payment of such value, together with interest, if any, as hereinafter
provided, to the stockholders entitled thereto upon the transfer by them to the
corporation of the certificates representing such stock if certificated or, if
uncertificated, upon receipt of an instruction transferring such stock to the
corporation. For this purpose, the value of the shares shall be determined as
of the day preceding the date of the vote approving the proposed corporate
action and shall be exclusive of any element of value arising from the
expectation or accomplishment of the proposed corporate action.

Sec. 93. Reference to special master

The court in its discretion may refer the bill or any question arising
thereunder to a special master to hear the parties, make findings and report
the same to the court, all in accordance with the usual practice in suits in
equity in the superior court.

Sec. 94. Notation on stock certificates of pendency of bill

On motion the court may order stockholder parties to the bill to submit
their certificates of stock to the corporation for the notation thereon of the
pendency of the bill and may order the corporation to note such pendency in
its records with respect to any uncertificated shares held by such stockholder
parties, and may on motion dismiss the bill as to any stockholder who fails to
comply with such order.

Sec. 95. Costs; interest

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The costs of the bill, including the reasonable compensation and
expenses of any master appointed by the court, but exclusive of fees of
counsel or of experts retained by any party, shall be determined by the court
and taxed upon the parties to the bill, or any of them, in such manner as
appears to be equitable, except that all costs of giving notice to stockholders
as provided in this chapter shall be paid by the corporation. Interest shall
be paid upon any award from the date of the vote approving the proposed
corporate action, and the court may on application of any interested party
determine the amount of interest to be paid in the case of any stockholder.

Sec. 96. Dividends and voting rights after demand for payment

Any stockholder who has demanded payment for his stock as provided in
this chapter shall not thereafter be entitled to notice of any meeting of
stockholders or to vote such stock for any purpose and shall not be entitled
to the payment of dividends or other distribution on the stock (except
dividends or other distributions payable to stockholders of record at a date
which is prior to the date of the vote approving the proposed corporate
action) unless:

(1) A bill shall not be filed within the time provided in section ninety;

(2) A bill, if filed, shall be dismissed as to such stockholder; or

(3) Such stockholder shall with the written approval of the
corporation, or in the case of a consolidation or merger, the resulting or
surviving corporation, deliver to it a written withdrawal of his objections to
and an acceptance of such corporate action.

Notwithstanding the provisions of clauses (1) to (3), inclusive, said
stockholder shall have only the rights of a stockholder who did not so demand
payment for his stock as provided in this chapter.

Sec. 97. Status of shares paid for

The shares of the corporation paid for by the corporation pursuant to
the provisions of this chapter shall have the status of treasury stock, or in
the case of a consolidation or merger the shares or the securities of the
resulting or surviving corporation into which the shares of such objecting
stockholder would have been converted had he not objected to such consolidation
or merger shall have the status of treasury stock or securities.

Sec. 98. Exclusive remedy; exception

The enforcement by a stockholder of his right to receive payment for his
shares in the manner provided in this chapter shall be an exclusive remedy
except that this chapter shall not exclude the right of such stockholder to
bring or maintain an appropriate proceeding to obtain relief on the ground
that such corporate action will be or is illegal or fraudulent as to him.

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REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

To Kevlin Corporation:

We have audited the accompanying consolidated balance sheets of Kevlin
Corporation (a Massachusetts corporation) and subsidiaries as of May 31, 1995
and 1994, and the related consolidated statements of operations, changes in
stockholders' equity and cash flows for each of the three years in the period
ended May 31, 1995. These consolidated financial statements are the
responsibility of the Company's management. Our responsibility is to express
an opinion on these consolidated financial statements based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.

In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the financial position of Kevlin
Corporation and subsidiaries as of May 31, 1995 and 1994, and the results of
their operations and their cash flows for each of the three years in the
period ended May 31, 1995, in conformity with generally accepted accounting
principles.

/s/ ARTHUR ANDERSEN LLP

Boston, Massachusetts,
July 7, 1995
<PAGE> 70

[Front of Proxy Card]

KEVLIN CORPORATION
PROXY FOR SPECIAL MEETING TO BE HELD
MARCH 7, 1996
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS

The undersigned, having received the Notice of Special Meeting and the
Board of Directors' Proxy Statement, hereby appoint(s) Jonathan D. Donaldson and
John J. Moran, and each of them, Proxies of the undersigned (with full power of
substitution) to attend the above Special Meeting and all adjournments thereof
(the "Meeting") and there to vote all shares of Common Stock of Kevlin
Corporation (the "Company") that the undersigned would be entitled to vote, if
personally present, hereby revoking any Proxy heretofore given with respect to
such shares in regard to all matters which may come before the Meeting, and
specifically with respect to that matter set forth on the reverse hereof.

THIS PROXY, WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED BY THE
UNDERSIGNED STOCKHOLDER(S). IF NO SPECIFICATION IS MADE, THIS PROXY WILL BE
VOTED FOR PROPOSAL 1.

SEE REVERSE SIDE. IF YOU WISH TO VOTE IN ACCORDANCE WITH THE BOARD OF
DIRECTORS' RECOMMENDATIONS, JUST SIGN ON THE REVERSE SIDE. YOU NEED NOT MARK
ANY BOXES.
-----------
SEE REVERSE
SIDE
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<PAGE> 71

<TABLE>

[Back of Proxy Card]
<S> <C> <C> <C>
/X/ Please mark votes as
in this example.

1. To approve and adopt the Agreement and Plan FOR AGAINST ABSTAIN
of Merger among the Company, Chelton
Communications Systems, Inc. and Kevlin / / / / / /
Acquisition Corp.

2. To consider and act upon such other business matters or proposals as may
properly come before the Meeting.

MARK HERE
FOR ADDRESS / /
CHANGE AND
NOTE AT LEFT

Please sign exactly as name appears hereon. Joint owners
should each sign. When signing as attorney, executor,
administrator, trustee or guardian, please give full title
as such.

Signature:______________________________________ Date________

</TABLE>